What consumer protection rules apply to online terms in Ontario?

Most terms of service are written as though the company sets the rules. For consumers in Ontario, the Consumer Protection Act, 2002 sets some of them first, and a clause that conflicts with it doesn’t hold.

Who counts as a consumer?

The Act defines a consumer as an individual acting for personal, family or household purposes, not someone acting for business purposes. It applies to consumer transactions where the consumer or the business is located in Ontario when the transaction takes place (s. 2). So a Toronto company selling to individuals anywhere, or any company selling to individuals in Ontario, should assume it applies. A SaaS product sold only to businesses generally isn’t covered, which is one reason to keep consumer and business terms separate.

What are the internet agreement rules?

An internet agreement is a consumer agreement formed by text-based internet communications. Where the consumer’s total potential payment obligation is more than $50 (O. Reg. 17/05, s. 31), sections 38 to 40 apply:

Requirement	What it means in your checkout or sign-up
Disclose prescribed information before the agreement (s. 38(1); reg. s. 32)	Your name and business name, phone number, address and other contact methods; a fair and accurate description of what you’re selling, including technical requirements; itemized prices with taxes and shipping; additional charges; the total, or for an indefinite subscription, the amount and frequency of payments; payment terms; delivery or performance dates; your cancellation, return, exchange and refund policies; the currency if not Canadian; and any other restrictions or conditions
Make the disclosure accessible (s. 38(3))	Presented so the consumer has accessed it and can retain and print it
Express opportunity to accept, decline and correct errors (s. 38(2))	A clear accept step and a review screen before payment
Deliver a copy within 15 days (s. 39; reg. s. 33)	An email confirmation with the agreement, the prescribed information, the consumer’s name and the date

What happens if I don’t comply?

The consumer may be able to cancel. Under s. 40, if you didn’t make the required disclosure or didn’t give an express opportunity to accept, decline or correct errors, the consumer can cancel from the date of the agreement until seven days after receiving a copy. If you didn’t deliver a copy as required, they can cancel within 30 days after the agreement was made.

Which clauses can’t I rely on against consumers?

• Waivers of the Act. Consumers’ substantive and procedural rights under the Act apply despite any agreement or waiver (s. 7(1)).
• Mandatory arbitration. A term requiring arbitration is invalid so far as it prevents a consumer from suing in the Superior Court of Justice under the Act (s. 7(2)). Once a dispute arises, the parties can agree to arbitrate.
• Class action waivers. A consumer can start or join a class proceeding despite a term that tries to prevent it (s. 8).
• Disclaimers of quality. Services supplied under a consumer agreement are deemed to be of reasonably acceptable quality, and goods carry the implied conditions and warranties of the Sale of Goods Act. A term that tries to negate or vary those is void (s. 9).
• Ambiguous wording. An ambiguity in a consumer agreement is interpreted to the benefit of the consumer (s. 11).

Separately, false, misleading or deceptive representations and unconscionable representations are unfair practices (ss. 14, 15 and 17), and a consumer who enters an agreement after or while one occurs may rescind it and claim other remedies (s. 18). That matters for how you describe features, pricing and free trials, not only for the terms.

What do the courts add?

Even outside the Act, courts look hard at standard-form consumer and platform terms. The Supreme Court of Canada declined to enforce a forum selection clause in Facebook’s consumer terms in Douez v. Facebook, and found an arbitration clause in Uber’s standard driver contract unconscionable in Uber Technologies Inc. v. Heller. See are clickwrap agreements enforceable in Canada.

Is the Consumer Protection Act, 2023 in force?

No. Ontario passed the Consumer Protection Act, 2023 in December 2023 to replace the 2002 Act, but e-Laws states that it comes into force on a day to be named by proclamation, and as of the October 2026 e-Laws consolidation it was not yet in force. Until then, the 2002 Act and O. Reg. 17/05 are the rules. Draft your terms so they can be updated when the new Act and its regulations take effect, especially around subscriptions, renewals and cancellation. For other provinces’ subscription rules, see subscription and cancellation laws in Canada.

A short checklist for consumer terms

1. Put the prescribed disclosures on the checkout or plan page, not only in the terms.
2. Use an active accept step and a review screen.
3. Send a confirmation email with the agreement within 15 days, ideally immediately.
4. Don’t rely on mandatory arbitration, class action waivers or blanket quality disclaimers against Ontario consumers.
5. Write plainly; ambiguity works against you.
6. Keep separate business terms if you also sell to companies.

What to do next

We draft terms of service that account for Ontario consumer rules, and review checkout and sign-up flows, at fixed fees on our fees page. See also limitation of liability clauses.

This guide is general information about Ontario and Canadian law, not legal advice for your situation. To check your consumer terms and checkout, book a free 15-minute consult.