May 3, 2023
On May 2, 2023, Canada’s Globe and Mail published an opinion by Canada’s Commissioner of Competition (Commissioner), Matthew Boswell, arguing that key Canadian consumer markets are highly concentrated and urging for another new round of Competition Act reform.
In this regard, in general, the Commissioner argues that Canada has had a long history of concentration and monopolization in key sectors, including transportation, telecom and banking, and that legislative reform has for the most part resisted increasing competition.
The Competition Bureau’s (Bureau) views follow a series of both recent federal government and Bureau recommendations for sweeping Competition Act legislative reforms, as well as an initial round of Competition Act amendments that were passed in June 2022.
For more information, see: Competition Bureau Publishes Sweeping Recommendations for Canadian Competition Law Reform, Competition Bureau Enforcement and Advocacy: Recent Developments, New Canadian Government Consultation on Fundamental Competition Act Amendments and Canadian Government Announces Sweeping Stage II Review of Federal Competition Law.
The Commissioner notes, rightly, that Canada’s competition laws were not fully overhauled since 1986, which is when Canada’s Competition Act replaced the former Combines Investigation Act. There have, however, been several periodic significant rounds of amendments to Canada’s competition laws since that time, including in 1999, 2002, 2009 and as well last June. For more information, see: Competition Act Amendments.
The Commissioner’s comment appears, at least in part, to be driven by recent soaring inflation in Canada (and globally) as well as limited competitive options for Canadians in key consumer sectors:
“Canadians are seeing the impact of increasingly concentrated sectors dominated by giant corporations. They worry about rising bills and grow frustrated by limited choices and poor customer service.”
While the Bureau has had some recent competition enforcement successes over the past several years, it has increasingly cited perceived weaknesses in Canada’s substantive competition law for its inability to fully perform its mandate (e.g., low penalties relative to other major international jurisdictions not providing sufficient deterrence, high bars for establishing both civil and criminal violations of the Competition Act, particularly for abuse of dominance under section 79 of the Act, and also in relation to Canada’s current efficiencies defence for mergers).
The Bureau has also pointed to what it sees as a number of procedural defects in enforcing Canada’s competition laws, including challenges obtaining timely interim injunctive relief in Canadian contested merger cases.
Though the Commissioner describes the Bureau’s Competition Act amendments as “far from radical”, it has made more than 50 amendment related recommendations for most of the cornerstone provisions of the Act in a significant recent submission to the government (see: Competition Bureau Publishes Sweeping Recommendations for Canadian Competition Law Reform).
Given that public consultations on this new potential round of Competition Act amendments have just closed at the end of March, it still remains to be seen whether (and to what extent) the federal government will accept the Bureau’s recommendations as well as those of other public stakeholders to overhaul and modernize Canada’s Competition Act.
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