Canada: Advertising During The Federal Election

In June 2019, the federal government amendment the Canada Elections Act (Act) to enhance the transparency of third-party participation in the electoral process. With another federal election around the corner, it is important for companies to observe the restrictions imposed on activities, such as partisan and election advertising, partisan activities and election surveys conducted during the pre-election or election period.

What you need to know

• Regulated activities include partisan activities, election advertising and election surveys conducted during the election period.
• Third parties that incur $500 or more in expenses associated with regulated activities must register with the Chief Electoral Office.
• Expenses incurred conducting regulated activities must be capped at $350,000 during the election period.
• Failure to comply with the Act may result in significant fines and jail.

Who is affected and what activities are regulated?

A third party is defined broadly to include any person or group that is not a candidate, a potential candidate, a registered party, or an electoral district association of a registered party¹. A third party will be required to register with Elections Canada if it incurs expenses of $500 or more for conducting regulated activities.

Regulated activities during an election period include election advertising, election surveys (which are conducted to assist in the transmission of election or partisan advertising) and partisan activities which identify a party or a candidate².

Election advertising

Election advertising, which takes place during the election period, is the public transmission of an advertised message that promotes or opposes a party, a candidate, including by taking a position on an issue with which a registered party or candidate is associated. Certain activities, such as the transmission of editorials, speeches, interviews, the distribution of books that were planned regardless of the election or an individual transmitting personal political views on the internet or encouraging electors to vote are exempted from the definition of "election advertising"³.   

Any issue mentioned by the party or candidate in a platform, debate, or social media campaign could be viewed as being as associated with a party or candidate.  The concept of "issue advertising" has been much contested over the years, as many have complained that its definition is overly broad. The Supreme Court of Canada in Harper v Canada (Attorney General) held that the scope of what constitutes issue advertising, while broad, is not unconstitutionally vague⁴. As such, advertising messages transmitted during the election period may engage the advertising rules even if the issue being addressed seems apolitical.

With this in mind, third parties that wish to advertise during an election period will need to consider whether their advertising could be perceived as taking a position on an issue that is associated with a party or a candidate.

Obligations in conducting regulated activities

The first obligation on a third party who engages in a regulated activity (whether in the pre-election or election period) and reaches the expense threshold of $500 is to register with Elections Canada. Once registered, the third party becomes subject to several requirements—the most important being a cap on expenses incurred for regulated activities. Expenses caught under this cap include the market value of goods, labour or services.

Although the maximum for pre-election period expenses is capped at $700,000⁵, the maximum for election period expenses is capped at $350,000⁶. The Act provides for this amount to be adjusted for inflation.

In the case of a general election that is not held on the day established by Parliament, such as is the case this year, the third party will be deemed to not have incurred a partisan activity expense, an election advertising expense or an election survey expense if, on the issue of the write, the third party is unable to cancel the activity, the transmission or the advertising⁷. 

Registered third parties are also subject to other obligations, such as mandatory name placement⁸; the appointment of an auditor should expenses exceed $10,000;⁹ and the filing of third-party expenses returns¹⁰.

Consequences of breaching the Act

There are many offences under the Act relating to election advertising and, depending on the offence, may result in fines and or imprisonment. Of particular concern for compliance purposes are the offenses related to "collusion". The Act provides that a third party who collaborates (or, as referred to in the Act, "colludes") with another third party to circumvent the regulated activities expense limit may be liable for fines of up to $100,000 and/or to imprisonment for up to five years.

For this reason, any third party who collaborates or discusses election advertising with another party while conducting its own advertising campaign should be particularly sensitive to the legislative requirements.

Footnotes

1. See section 349 of the Canada Elections Act

2. Chapter 6 of the Political Financing Handbook for Third parties, Financial Agents and Auditors, June 2021, identifies calling electors, canvassing, rallies as partisan activities

3. Section 2(1) of the Canada Elections Act

4. [2004] 1 S.C.R. 827 at para 90.

5. Section 349.1 of the Canada Elections Act

6. Section 350 of the Canada Elections Act

7. Section 350(4.1) of the Canada Elections Act

8.  This is specific to any election advertising message during the election period (section 352 of the Canada Elections Act).

9. Section 355(1) of the Canada Elections Act

10. Section 357.01 of the Canada Elections Act

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.