OTTAWA – Under new proposed amendments introduced in the House of Commons today, the Competition Tribunal may order telecommunications service providers to pay an administrative monetary penalty of up to $15 million in cases of abuse of market power.
"Competitive telecommunications markets are vital to a strong economy, especially given the rapid changes in information technologies that are transforming how businesses operate and how individuals communicate and gather information," said Industry Minister Maxime Bernier, who introduced the amendments. "Competition drives firms to become more efficient, invest in new technologies and introduce new products and services that benefit consumers."
"Allowing the Competition Tribunal to impose financial penalties will safeguard against anti-competitive behaviour that could ultimately harm consumers and promote timely and voluntary compliance in the telecommunications industry."
Such fines were a key recommendation of the March 2006 Telecommunications Policy Review Panel, and have also been supported by outgoing CRTC chairman Charles Dalfen.
Currently there are no provisions to levy fines if a telecom company is accused of abusing its market power and as the telecommunications industry is deregulated, increased competition law oversight and enforcement is required to ensure that competition has the opportunity to develop where it can eventually replace regulation as the key source of discipline in those markets, says the Industry ministry.
"Certain characteristics of the telecommunications industry warrant special consideration. For example, service providers must often rely on access to a competitor’s network to provide service to their customers. At the same time, these suppliers are often fully integrated and able to offer the same range of service and compete for the same customers," adds the release.
"It is believed that a telecommunication specific AMP will increase compliance with the Act by helping deter anti-competitive practices by dominant telecommunications service providers in a deregulated environment."
The penalties would be paid to the Consolidated Revenue Fund
The Competition Bureau is an independent law enforcement agency that promotes and maintains fair competition so that all Canadians can benefit from competitive prices, product choice and quality service. It oversees the application of the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act.
