Project Overview and Status

The Law Commission of Ontario’s Digital Marketplace Initiative is collaborating with leading academics in Canada in an innovative, data-driven project to identify law reform options related to so-called “click to consent” or “terms of service” (ToS) contracts.

These contracts define the relationship between consumers and the “digital marketplace” platforms and services they use, governing the use of everything from smart home devices to booking and shopping platforms to AI-assisted cars and everyday activities on social media platforms.

The evolution of the “click consent” approach has been legally piecemeal over the last 20 years. Consumers, businesses and government alike are expressing increasing concern that this framework no longer meets contemporary needs.

For consumers these contracts are nearly impossible to read, frequently change without notice, and undermine the informed consent and “buy in” they are intended to reflect. For businesses this same problem represents a risk to regulatory compliance and to their customer relationship, and can make it difficult to determine business point of practice or governance over data and content transmitted across borders.

Federal and provincial governments share responsibility for consumer protection in Canada. But existing legislation struggles to provide clear guidance on newly emerging issues distinct to digital platforms and services. These can be concerns over jurisdiction (what law applies?); choice of law (how is a jurisdiction chosen if it is unclear, and, does this favour one party over the other?); and dispute resolution (if consumer concerns or complaints arise, how are these resolved, and where?).

It is also unclear how emerging issues in digital consumer protection are related to other existing federal and provincial legislation like data protection and privacy law, competition law, or product safety, and to voluntary codes of conduct or industry standards over issues like advertising and marketing standards, youth and parental consent, consumer profiling, and so forth.

Federal and provincial governments have begun talking about the need to address these gaps with modernized consumer protection law. Ontario’s 2019 Digital Strategy recommends that the time has come to “find new and agile ways to ensure consumer protections… [and] Help Ontario businesses protect and respect consumers’ rights when collecting their data; …Prevent discriminatory market practices enabled by data-driven practices; … [and] Ensure that strong measures are in place to protect Ontarians, promote public trust and confidence and mitigate risks.” Canada’s 2019 Federal Digital Charter and privacy law consultations similarly suggest that “reducing reliance on consent for common practices or trust environments could provide a balanced approach for individuals and businesses.”

Today, it is fair to say, click consent and terms of service contracts represent an approach that is hugely variable between products and platforms, poorly understood, largely unexplored, generally unintelligible, legally questionable, and totally ubiquitous.

What Issues Are Being Looked At?

Modernizing consumer protection legislation includes a look at a wide array of potential issues that have come to the attention of the LCO through our research and preliminary consultations with key stakeholders. Among the issues that have been raised are:

  • Modernized consumer protection legislation
  • Standard terms for consumer digital services contracts
  • Consumer dispute resolution
  • Jurisdiction and forum shopping
  • Business point of presence law
  • User profiling and variable pricing, search results, microtargeting, and other forms of content shaping
  • Bogus product and service reviews
  • Youth consent to online platforms and service
  • Smart devices and intimate partner violence, stalkerware
  • Dark patterns and behavioural nudges in platform design

The LCO’s final list of law reform issues and consultation topics will be developed after further consultations with a broad group of stakeholders, our Advisory Committee, and the LCO Board of Governors.

The LCO’s Approach

The LCO’s Consumer Protection in the Digital Marketplace project will address the problems head on. Our innovative approach will use legal textual data analysis and machine learning technology to create Canada’s first comprehensive, empirical, and evidence-based assessment of hundreds of the most common such contracts. This will better identify how these contracts are shaping consumer rights, related rights (such as privacy), and the behaviour of users across the digital platform, app, and digital services marketplaces.

Patterns identified in this dataset, and analyzed through the respective privacy law and consumer protection lenses by collaborating with leading academics in Canada, will result in a set of joint law reform recommendations that will make an immediate and important contribution to ongoing debates between the privacy and consumer protection fields, and which will help redefine a path towards the most appropriate regulatory tools and architecture for responding to the “digital marketplace” on a national and provincial level.

The project will also result in the public and open publication of an online dataset and tools which represents an unprecedented and comprehensive profile of the digital legal reality experienced by Canadian consumers and corporations. This, in turn, will foster additional studies conducted by others on an ongoing basis in the future. The LCO and leading academics in Canada believe the project may also have international implications.

The LCO is currently conducting background research and key informant interviews, as well as establishing membership in the Advisory Group. If any aspect of this project is of interest to you, we’d be delighted to receive feedback. Should you have any questions contact Ryan Fritsch, Project Lead, at rfritsch@lco-cdo.org.

Project Documents

  • Forthcoming