Madam Speaker, as a member who has been sitting in the House for many years, I should know that. My apologies to the interpreters and to all those who felt the inconvenience.
As I was saying, we have provided additional funding to the Competition Bureau. In 2022, in the budget legislation, we included additional amendments to make sure that wage fixing agreements between employers would be illegal, and there would be an increase in maximum penalties so unfair practices could no longer be absorbed by the largest firms as simply a cost of doing business.
Before introducing these amendments, we undertook a formal review of the act and its enforcement regime through an extensive consultation process in order to get feedback from Canadians on possible fundamental reforms.
In keeping with that promise, in November 2022, I launched the consultation on the future of competition policy in Canada. As part of this process, we received more than 130 submissions from stakeholders and more than 400 submissions from members of the general public, whom I would like to thank.
We spent the last several months listening to Canadians and carefully analyzing their submissions. We are now responding with an initial set of amendments to rebalance the marketplace. While it is only the first response to the consultation, these amendments strike at the core of the country's competition law regime and will undoubtedly empower the Competition Bureau to better serve the public and improve competition. I would like to thank it for all its work while I am delivering these remarks to the House.
As part of its mandate, the bureau conducts market studies to identify relevant regulations, business practices or other factors that may impede competition in a given sector. However, unlike many competition authorities around the world, the bureau does not have formal investigative powers to compel information. Rather, it must rely on what information is already in its possession, publicly available or provided voluntarily by stakeholders. Because the bureau cannot compel information, it has become apparent that it can rarely get a complete picture, leaving knowledge gaps and potentially casting doubt on the reliability or completeness of the information it gathers. This means that the recommendations the bureau can provide to the government and Canadians are not as complete and as impactful as they could be.
We therefore propose to grant the bureau the authority to conduct market studies in which it can seek to compel the production of information. This was highlighted as a very important issue by the bureau's retail grocery market study and was formally recommended by the Standing Committee on Agriculture and Agri-Food.
I would also underscore that the proposal to create a formal market study framework was broadly supported by stakeholders during the public consultations. However, many stakeholders emphasized the need for safeguards to prevent fishing expeditions or investigations that place a heavy burden on companies or the government.
We considered these comments carefully and came up with a proposed framework aligned with international best practices. I think this will ensure that any burden placed on the companies is limited to what is strictly necessary to achieve public policy objectives.
We have a quite unique feature in our competition law regime that has been the subject of much debate and criticism throughout the law's existence, known as the so-called efficiencies exception or efficiencies defence. It currently protects a merger that harms competition from being successfully challenged, so long as the efficiency gains that it generates for the companies involved will exceed the harm to competition and therefore, supposedly, the harm to consumers.
The provision has been cited as a significant obstacle to competitive markets by a broad cross-section of stakeholders for many years, and particularly so during the public consultation. This exception makes it nearly impossible for the bureau to successfully challenge anti-competitive mergers, so much so that it rarely tries to do it.
Many stakeholders have argued that the act is too narrowly focused on gains in efficiency that benefit specific companies over the short term, but that ultimately lead to industry concentration that hurts consumers over the long term. We are proposing to eliminate the efficiencies exception, which would mean that if a proposed merger were considered anti-competitive, it could be reviewed despite any efficiency gains generated for the companies.
Repealing this exception would give priority to competition and bring Canada in line with international standards.
Of course, if a proposed merger creates efficiencies that strengthen competition in a sector, the tribunal would be able to consider them in its deliberations.
Let me talk about vertical collaborations. The act already recognizes that certain collaborations between competitors may result in significant harm to competition, even if they fall short of the true cartel practices like price fixing or bid rigging. Currently, only agreements between competitors, or so-called horizontal collaborations, can be addressed under the act in most cases. However, agreements between non-competing entities, such as a landlord and a tenant, are known as vertical agreements and are outside the scope of the bureau's review of potentially anti-competitive agreements, even if they result in less competition.
As identified in the bureau's recent retail grocery market study, cases have emerged about property controls made between commercial landlords and tenants to exclude potential competitors from a rental property, sometimes even after the tenant has left. One can understand why we are focusing on that. At the same time as we are talking to the CEOs of grocery chains to say they have to help Canadians, that they have to be part of stabilizing prices, we want this landmark reform on competition because we need to address these issues.
In some cases, controls like these have prevented independent grocers from moving into the only shopping centre in a community. In other cases, discount retailers were prevented from selling certain products near large supermarket chains renting from the same landlord.
We are proposing to amend the provision to allow for the review of vertical collaborations that essentially seek to limit competition, even if the agreements are not between competitors. It would also open the door for the Competition Bureau to look at other forms of collaboration, beyond property controls that can harm competition.
In conclusion, the consultation revealed a strong appetite for further reforms to strengthen the law and its enforcement. I would say it is about time that we had landmark reform of competition in this country, at a time when Canadians want to see less consolidation, more competition and lower prices. Now is the moment to act. I hope everyone in this House will join us, because this is about Canadians. This is about Canada. This is about our competitiveness around the world.
As the next step in our continued efforts to modernize the law, these proposed amendments directly contribute to addressing the most immediate concerns of Canadians about the rising cost of groceries, while we continue to consider further reform to ensure that Canadians and small businesses can benefit from fair marketplaces across Canada.
Let us improve competition in Canada, increase innovation and lower costs for Canadians. With that, I hope that all members in this House will support Bill C-56 so that we can show Canadians, not only as government but as parliamentarians, that we will act to help them in times of high costs.
