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BUS 393 > module 7 - governmental regulation > Flashcards

module 7 - governmental regulation Flashcards

1
Q

where do risks come from in governmental rules?

A

governmental regulatory risk arises from laws that require businesses to operate in a certain way, and if they fail to do so, then the government will take action against that business

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2
Q

what kinds of actions do governments pursue legal action against businesses?

A

issues regarding consumer protection, false/deceptive advertising, competition regulations, environmental protection

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3
Q

what are some obligations you need to consider when opening a business?

A

how will you run your business?
how will you compete with other businesses?
how will you sell things using contracts with consumers (including online contracts)?

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4
Q

what is the sale of goods act?

A

implies warranties and conditions into a sale contract, including product safety

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5
Q

what does the consumer protection legislation do?

A
  • prevents false advertising/deceptive marketing
  • addresses exclusion clauses being used to override warranties
  • prevents unconscionable transactions
  • mandates disclosure of important information for the consumer
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6
Q

what are some issues regarding online and electronic commerce?

A

there are new rules regarding consumer protection against spam and phishing as well as telemarketing

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7
Q

what does the competition act do?

A

protects consumers from price fixing and collusion and misleading advertising/false claims

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8
Q

environmental regulations and protections?

A

national and provincial rules exist to protect the public from pollution and other harms to the environment and our health

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9
Q
A
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9
Q

why would businesses want laws

A
  • they can provide clarity and predictability
  • they ensure that everyone has to operate according to the same rules
  • the cost of regulation or no rules is often greater than having rules
  • rules can create opportunities for innovation
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10
Q

why is “the impact on the consumer” the focus of the competition cases?

A

monopolies and lack of competition often create prices that are higher than they would normally be, in a competitive and more fair market place

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11
Q

what business practices interfere with competition?

A
  1. restraint of trade clauses in contracts
  2. mergers and market domination through monopolies
  3. market manipulation through collusion (e.g. prixing)
  4. conspiracy to manipulate markets through cooperation among competitors such as bid rigging
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12
Q

what does the competition act do about businesses interfering with competition

A

uses criminal and civil penalties (monetary fines or time in jail) to prevent monopoly and promote competition

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13
Q

what is misleading or deceptive?

A

a statement about a “material fact”
- is determined objectively rather than subjectively, with defence of due diligence
- statement can be made on packaging
- any false marketing

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14
Q

what is required disclosure on online ads and marketing?

A

you are obligated to disclose known risks of your product, product promoters are obligated to indicate whether they are gaining any financial benefit from their promotion of a product

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15
Q

what claims can you make about what is natural? natural health product regulations must …

A
  • require product licensing
  • evidence requirements for safety and efficacy
  • labelling and disclosure
  • adverse reaction reporting
  • disclose warnings and recalls
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16
Q

spam and consent for online marketing?

A

businesses cannot send electronic messages to encourage participation in a commercial activity, unless you have the expressed consent from the recipient
- businesses MUST provide a way to unsubscribe, at all costs

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17
Q

penalties?

A

if businesses do not obtain express consent, they can be sued for damages up to $200 for each non compliant commercial activity
- up to $1M per day
- CEOs, officers and directors of a company can be held personally liable for the violation

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18
Q

defence against rules for online marketing and spam?

A

due diligence
- drafting and implement CASL policies, procedures, and training

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19
Q

what is the right to rescind a contract?

A

right to change mind, also called cooling off period

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20
Q

what is specific to the right to refuse any unsolicited goods?

A
  • you don’t have to pay for unsolicited goods
    and don’t have to keep any unsolicited goods
21
Q

there can be criminal penalties for some offences such as..

A

price-fixing, and agreement to restrict competition

22
Q

why create rules about environmental protection and harm?

A

as environmental rules expand, so do their risks, which is why strategy is important
- the level of environmental harm due to business practices is increasing
- whether that environmental harm is intentional or negligent, the harms from business are typically the most severe

23
Q

who should bare the costs of environmental pollution and degradation?

A

in the past, answer was typically communities and taxpayers, nt businesses
- but laws have been created, overtime many businesses have acknowledge that this is a part of their responsibility as they have the most harm

24
Q

what are some benefits of environmental regulations?

A

some businesses see regulations as opportunities for innovation
- some environmental rules promote economic and environmental development

25
Q

how do federal and provincial statutes create liability for environmental harm?

A

different acts establish different regulations and policies, businesses face the risk of fines or remedies against them if not complying
- common law rules cam be used to create liability for environmental harm

26
Q

permits?

A

must be obtained to conduct certain business activities such as mining. fishing, forestry and certain types of land use

27
Q

what are environmental and social impact assessments?

A

processes that business must complete to evaluate risk and obtain approval from government

28
Q

duty to consult?

A

rules that obligate businesses to consult with communities impacted by a proposed activity
e.g. pipeline develop or mining operation

29
Q

why is reputational risk important?

A

it is increasinging for business to adhere to CSR and manage the reputational risk of environmental harm and mismanagement
- since businesses want to appear as “socially responsible” and want to follow a process where they have properly consulted with stakeholders, to have a social license

30
Q

what is the shareholder’s significance in environmental risk?

A

investors can respond negatively when businesses do not manage their environmental risks

31
Q

insurance for environment?

A

insurers evaluate the cost of environmental risks, and whether a business or industry is managing these risks

32
Q

what is purpose of the canadian environmental protection?

A

prevent and respond to environmental pollution in order to promote environmental and human health alongside economic development, particularly sustainable development

33
Q

what does CEPA do?

A

research, setting standards, guidelines, codes of conduct, monitoring, inspection, prohibited substances. enforcement, remediation and penalties for violation, protects whistleblowers

34
Q

what is the purpose of environmental laws?

A

projects that may have an environmental impact, must undergo “impact assessment” to identify and mitigate environmental impact
- impact assessments include hearings and consultations with impacted companies

35
Q

what is the canadian environmental assessment act?

A

framework for environmental impact assessments (in Canada)

36
Q

what are some challenges with the impact assessment?

A

hard to assess environmental and social impact
- hard to assess possibilities for mitigation
- hard to assess the costs associated with environmental harm and mitigation

37
Q

what is the duty to consult?

A

the obligation to hear the concerns from communities impacted by projects
- this process however, does not give communities a “veto” over a project

38
Q

social license (environmental)?

A

businesses need to create a process where they have community support
- this support can be challenging (e.g. Indig. communities where support may differ within the communities)

39
Q

risk of consultation (environmental)

A

even though businesses pass the consultation process, does not mean that they are not going to be held liable in cases of accidents happening
- questions of negligence will be put onto the companies and individuals connected to the company

40
Q

what is crucial for businesses if an accident occurs?

A

it is very useful if the business had followed through with every step, regulation, and training
- if they can show that they do not cut corners to save costs, but the events still occur, it can be easier to come up with a mitigation strategy to make things better and compensate people for the environmental harm

41
Q

what is difficult about environmental impact of projects on climate change?

A
  • climate change is a difficult thing to measure
  • if an oil rig/pipeline bursts, it is easier to quantify the damages and mitigate risks in the beginning.
  • but in the issue of climate change, it is harder to quantify the long term damages
42
Q

why is reputation management and CSR important?

A

while it is costly to develop environmental harm prevention procedures and consultation takes a lot of time, the reputational costs of environmental disasters is huge

43
Q

consultation requirements?

A

there are rules in the canadian environmental assessment act about consultation, when big projects with potential environmental implications are being proposed

44
Q

Purpose? (climate change rules and strategy)

A

balance and sustainable economic growth and, developmental policies that will reduce the impact of human activity on the climate

45
Q

what does the CCCAP promote?

A

canada’s climate change action plan promotes clean energy and business activities such as clean electricity, methane regulations for oil and gas industry

46
Q

insurance risk and costs (climate change)?

A

as climate change worsens, it becomes more difficult and more costly for businesses to obtain insurance policy coverage
- legal risk: businesses and governments are increasingly being sued for their failure to meet climate change rules and obligations

47
Q

international climate change rules?

A

if you are a business operating globally ( or anywhere outside of Canada), you must comply with the rules in those jurisdictions where you are doing business
- rules may be more stringent outside of Canada

48
Q

how do rules regulating the environment encourage innovation?

A
  • environmental rules may prohibit certain products and activities
    innovative ways to comply with environmental laws create opportunities for innovation and competitive advantage
49
Q

BAT?

A

Many environmental laws require businesses to use their best available technology

50
Q

risk management strategy for government regulations
IDENTIFY…

A

IDENTIFY: all rules and obligations
rules not only deal with environmental harm, but evaluating the need/what is asked of in impact assessments and consultation
- rules that exist at all levels of government

51
Q

risk management strategy for government regulations
EVALUATE…

A
  • compliance at your business
  • determine whether your business is not only managing environmental risk (through monitoring technologies and training)
  • whether your business is taking advantage of new opportunities that laws create
  • evaluate costs of compliance and compliance strategies
  • determine the costs and benefits of compliance and environmental risk reduction
  • evaluate benefits of your environmental reputation (businesses that invest in environmental protection have a reputation for CSR

BUS 393 (4 decks)

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