OTTAWA – The Public Interest Advocacy Centre and the Canadian Bar Association locked horns this week in a Parliamentary committee over proposed amendments to the Competition Act, which would authorize the Competition Bureau to conduct entire market studies in the absence of a complaint regarding anti-competitive behaviour.
Bill C-452, a private member’s bill introduced by Bloc Québécois MP Robert Vincent, seeks to change the current law, which says the Commissioner of Competition can only launch an investigation when there is a concern about one or more market participants. While the bill appears to have originally been tabled to deal with the retail gasoline sector, the broad amendment makes the proposed legislation applicable for all industry sectors, including the communications industry.
Two previous Commissioners of Competition have asked for these additional powers. Both current CRTC chair Konrad von Finckenstein and previous commissioner Sheridan Scott advocated for the authority to conduct market studies during their tenures as head of the bureau.
The CBA is firmly opposed to giving additional powers to the Competition Bureau, noting that it is neither “necessary or appropriate” to empower the bureau with an industry-sector competition law inquiry authority. It believes the law as it currently stands is good enough.
“The Competition Act is not intended to regulate markets or to cast the bureau in the role of a regulator that proactively engineers competition. In the absence of anti-competitive conduct, there is nothing the commissioner can do,” stated Shuli Rodal, vice-chair of the legislation and competition policy committee in the competition law section of the CBA. She is also a partner in the competition and anti-trust law group of Osler, Hoskin & Harcourt in Toronto.
Michael Janigan, executive director and general counsel for PIAC, begged to differ, noting that a better understanding of the state of competition in a variety of industries could actually lead to more effective enforcement of the Competition Act. “It could also lead to improved advocacy and could contribute to the development of good policies to achieve economic objectives which would benefit all Canadians. Finally, it would lead to enhanced transparency in the marketplace for business and consumers,” he said.
Under questioning from Liberal MP Dan McTeague, Janigan highlighted the differing views of what the commissioner of competition is supposed to do. In one scenario, the commissioner is essentially a cop that investigates offences and then takes the offender to court or the competition tribunal. The second view is that the commissioner of competition is more than a cop, “he or she is an advocate for competition and must promote it,” in all sectors, he explained.
With respect to the new proposed powers, Janigan said the market studies may find cases of misconduct or anti-competitive behaviour, but the real goal of these studies is “is to establish what the state of competitiveness is in the market, what can we do to increase competitiveness, and make recommendations accordingly.”
Rodal said the current rules provide enough flexibility for the bureau to look at cases where there might be anti-competitive behaviour. Besides, she added, companies and people aren’t shy about complaining about market activity.
“Proceeding on that basis is, I think, sufficient,” she said. “I don’t see what is really being added by this open-ended power to undertake an inquiry which in the end produces, we think, very little benefit.”
But Janigan said the competition bureau has a responsibility to create and promote competitive markets, “separate and apart” from investigating anti-competitive conduct in a market. “There’s a whole variety of different ways that competition may be affected that doesn’t trigger anti-competitive conduct. There may be circumstances where there are essential facilities or bottleneck facilities where new entrants can’t get access,” he added.
The consequences of giving the competition bureau these added powers could have considerable and negative effects on the market targeted for the study, according to Rodal.
“All participants in the industry, on top of having to pay for the pleasure of being targeted in that market inquiry, would also suffer during the very long period of time it would take to actually conduct the inquiry, with the sort of cloud hanging over the industry that something is wrong,” she said.
Conservative members on the committee weren’t in favour of the amendments. Mike Lake, a Conservative MP, said the proposed changes give the competition bureau carte blanche to do what it likes.
“The commissioner just decides that they’re going to launch an inquiry into a certain sector and it happens. That’s what’s wrong with it,” he said. “We wouldn’t allow this in any other area of law. We wouldn’t allow the police to determine that a particular segment of society is more prone to criminal activity so we’re just going to investigate all of them, but that’s what this does.”
Despite opposition to the proposed amendments from the committee’s Conservative members, the bill passed by a six to five vote.
