Industry Committee on Dec. 9th, 2010

[Richard Bilodeau]

Yes.

[Bruce Stanton, Conservative, Simcoe North, ON]

So we have that on one hand. On the other hand, you said in your opening statement that whenever the commissioner has information that she believes can be acted upon, she has the ability to move ahead and conduct that investigation. In fact, you said that about 30% of the current investigations started that way.

Could you explain in lay terms how that process begins? What actually happens when you go and initiate that investigation?

[Richard Bilodeau]

Something is brought to our attention, or we come upon something in the course of our work.

[Bruce Stanton, Conservative, Simcoe North, ON]

It doesn't have to be a complaint?

[Richard Bilodeau]

It does not have to be a complaint. And we don't need a judge to sign off on initiating an inquiry. That is a power that's been invested by the Competition Act, by Parliament, in the Commissioner of Competition.

But no matter how an inquiry is started--regardless of whether the minister is instructing us to do it, six residents have asked to do it, or we're doing it of our own volition or through a complaint--if we want to use formal powers, we have to go before a judge. By formal powers I mean the ability to seek document production or have witnesses compelled to provide us with oral testimony. So whether it's under the current legislation or even under Bill C-452, we will still have to go before a judge to have subpoenas issued to companies under investigation. That is something that is in our act. It's section 11 of our act.

[Bruce Stanton, Conservative, Simcoe North, ON]

So to compel documents, to subpoena witnesses, you need to have the judicial sign-off to start?

[Richard Bilodeau]

Yes.

[Bruce Stanton, Conservative, Simcoe North, ON]

Earlier you said you could do 30% or your investigations without subpoenaing witnesses or compelling documents.

[Richard Bilodeau]

A number of our investigations are done without securing subpoenas, and sometimes we've taken cases forward without using those powers. Sometimes companies prefer to give us information voluntarily and under oath. We don't always have to seek section 11s.

[Bruce Stanton, Conservative, Simcoe North, ON]

So you don't think that the tenets of Bill C-452 are necessary, then?

[Richard Bilodeau]

We have the powers today to conduct the work, to carry out the mandate that Parliament has given us.

[Bruce Stanton, Conservative, Simcoe North, ON]

Thank you.

[The Chair, Conservative, David Sweet]

Thank you, Mr. Stanton.

Mr. Bouchard, you have five minutes.

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

Thank you, Mr. Chair.

Mr. Bilodeau, you said that you did have investigative powers. I even thought I heard you say earlier, after the last question, that you did not need a judge to begin an inquiry.

I would like you tell me what needs to be done in order to file a complaint. If I have a complaint to file with the Competition Bureau, what do I need to do? Is a telephone call sufficient? Do I have to provide my telephone number? Do I have to submit anything in writing, do I need witnesses, does everything have to be done under oath? Do I have to submit evidence, do research?

Finally, what do I have to do, at a minimum, in order to get the Competition Bureau to initiate an inquiry?

[Richard Bilodeau]

To answer your question, a formal inquiry is really—

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

Do you not have to go to a judge?

[Richard Bilodeau]

There is no need to call upon a judge. The formal investigation is the second step.

The first step involves calling in and saying what the problem is. That is what we call a preliminary investigation. You will be asked some questions for clarification. As I said earlier, the call may be enough. It depends on the circumstances, which industry we are talking about, and what information you provide. There may be other industries. Considerable information on the gas industry is publicly available. As you know, the price of crude oil is public as is the rack price. There is a great deal of information.

Considerable expertise has been built up over the years. We know a little more about the gas industry than other industries, which we know less about or where we have never before conducted an investigation. However, a call is sufficient, even though it is better to have proof.

However, that does not mean—

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

I think you are embellishing the truth. I called the Competition Bureau, and I can assure you that I had to describe the situation. Obviously everything was noted and they told me that the bureau would examine the issue. I did not know if there was to be an investigation or not, and I never found out. In other words, it's like sending out a message and receiving the replies much later, several months after you have done your own investigation. That is not timely.

[Richard Bilodeau]

Bear in mind that not all complaints received by the bureau necessarily lead to formal investigations under section 10. Forty-five investigations are currently underway, but in 2009, we received between 6,000 and 7,000 complaints. An investigation under section 10 is not automatically undertaken just because an individual lodges a complaint. Sometimes, the complaint deals with something that is not within our purview at the Competition Bureau. It is not about whether we investigate or not. It is simply that Parliament has not given us the mandate to investigate that. That is common.

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

Mr. Vincent, in your view, if your bill were to be adopted, how would it make things easier for a citizen who believes he has found something out of the ordinary?

[Robert Vincent, Bloc, Shefford, QC]

I think that citizens expect the Competition Bureau to be able to do an adequate job. An adequate job means two things to me. Moreover, he clearly mentioned that several times during his appearance.

First of all, a complaint must be launched, but the person calling in must be asked more questions. Does the complainant have the information required to undertake the investigation, in other words, does he have something concrete? Let's look at the example of the price of gas. Imagine a retailer calling you to say that someone has asked him to change his price at the pump. That would be concrete. The Competition Bureau would therefore have something serious enough to take to a judge and to investigate on this issue, but at present, he cannot initiate an investigation himself.

What powers are set out in Bill C-452? As Mr. Bilodeau said earlier, there is a shortage of funding and resources. Why don't they want additional investigation powers when that's what is lacking? How will they be able to do the job without money and resources? That's where the problem lies.

I think he did a good job of explaining it earlier. The culminating point when we examine bills, the question that is always asked at committee meetings is if that is done elsewhere. Is that done in other countries. It was in place before but no longer is. What more can we do? With these powers, we could save even more money because investigations could be undertaken immediately without there having to be an in-depth analysis and a judge involved.

[The Chair, Conservative, David Sweet]

Thank you, Mr. Vincent, Mr. Bouchard.

Now on to Mr. McTeague for five minutes.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

I'll come back to you, Mr. Bilodeau. Can I just ask about the gas stations in Quebec, which were charged under the old section 45, conspiracy? Are those matters still before the courts?

[Richard Bilodeau]

Yes, they are.

[Dan McTeague, Liberal, Pickering—Scarborough East, ON]

I wouldn't ask you to pursue that for those reasons, because it would be a matter sub judice. But it's my understanding that in that case, an individual mistakenly gave information to the bureau thinking that because they were not part of the deal there was somehow some infraction of the Competition Act. The bureau was unable to take the information, get it on record, and then proceed with the charges, which are ongoing. There was a lot of chest thumping when that happened. The overall assumption or impression left, in the absence of my explanation, was that the Competition Act works. In fact, you stumbled on it.

I'll leave that. I want to ask a question with respect to what Mr. Wallace quite readily pointed out. In 1989 you had several players who had their own wholesale price. I'm not talking about retail here, because I think it's pretty clear. We can debate until the cows come home what price inversions look like. If Costco in Mississauga or wherever they are in Ontario doesn't want to charge a retail margin and they want to invite people to come in, that's up to them.

What I think Mr. Vincent is most concerned about is what's happened at the wholesale level, which is the picture we don't exactly see. That's of course where you see identical regionally based prices. Is that a reflection of a lack of competition, or is it just super-competition? One makes the price, and the others simply follow. Or is it because, as has been quite rightly pointed out, they share a product, region by region, for matters of efficiency? I won't conclude why that is but will simply underline that all of your investigations have been predictably useless and irrelevant, because they're following only certain assumptions about the market. Quite apart from who provides you with information and how you acquire information, there has been no global study in this industry, or for that matter in others.

I recall one many years ago that I tried to initiate on the issue of the grocery industry. Justice Kelen, who is on the Federal Court now, was co-author. I did that because we felt that the bureau and the Competition Act that was written in 1986 failed to appreciate the rather distinct and dramatic changes taking place that were impacting consumers and the competitive process throughout the country.

My question to you is about the power of inquiry, which you may see as redundant to the powers you currently have. There's been no change to subsection 10(1) of the “inquiry by commissioner” section in the Competition Act. Is that correct?