House of Commons Hansard #136 of the 36th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was extradition.

Topics

Extradition ActGovernment Orders

1 p.m.

Some hon. members

Nay.

Extradition ActGovernment Orders

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The Deputy Speaker

In my opinion the yeas have it.

And more than five members having risen:

Extradition ActGovernment Orders

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The Deputy Speaker

Pursuant to Standing Order 45, the division stands deferred until Monday, October 19, 1998, at the ordinary hour of daily adjournment.

Extradition ActGovernment Orders

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Liberal

Bob Kilger Liberal Stormont—Dundas, ON

Mr. Speaker, I rise on a point of order. I believe you would find consent to further defer the recorded division requested on second reading of Bill C-40 to the expiry of Government Orders on Tuesday, October 20, 1998.

Extradition ActGovernment Orders

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The Deputy Speaker

Is that agreed?

Extradition ActGovernment Orders

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Some hon. members

Agreed.

Extradition ActGovernment Orders

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Reform

Ken Epp Reform Elk Island, AB

Mr. Speaker, I rise on a point of order. I am probably stretching this as a point of order but I want to make the point that many of us will be involved in committee hearings.

I am on the finance committee. We are travelling across the country and the rules of the House do not permit us to vote. Therefore we are effectively disenfranchised when these votes take place.

I wish that the House leaders would undertake some discussion to try to arrange for one day when no committees are out in the country so that we can all be here to vote.

Extradition ActGovernment Orders

1:05 p.m.

The Deputy Speaker

I am sure that the representations of the hon. member have been heard by the persons responsible for these kinds of decisions.

Extradition ActGovernment Orders

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Liberal

Bob Kilger Liberal Stormont—Dundas, ON

Mr. Speaker, I rise on a point of order. I believe if you were to seek it, you would find consent to see the clock as being 1.30 p.m.

Extradition ActGovernment Orders

1:05 p.m.

The Deputy Speaker

Is it agreed that we call it 1.30 p.m.?

Extradition ActGovernment Orders

1:05 p.m.

Some hon. members

Agreed.

Extradition ActGovernment Orders

1:05 p.m.

The Deputy Speaker

For all intents and purposes, it being 1.30 p.m., the House will now proceed to the consideration of Private Members' Business as listed on today's order paper.

The House resumed from September 22, consideration of the motion that Bill C-235, an act to amend the Competition Act (protection of those who purchase products from vertically integrated suppliers who compete with them at retail), be read the second time and referred to a committee.

Competition ActPrivate Members' Business

1:05 p.m.

Halton Ontario

Liberal

Julian Reed LiberalParliamentary Secretary to Minister of Foreign Affairs

Mr. Speaker, Bill C-235 proposes substantive amendments to the Competition Act. They are intended to address pricing practices in industries, particularly the petroleum industry which are characterized by vertical integration and dual distribution, that is, industries where firms carry on operations in wholesale and in retail markets and compete in retail markets with firms to whom they supply at the wholesale level.

I would like to take a moment initially to commend the hon. member for Pickering—Ajax—Uxbridge and his colleagues for their work on the Liberal committee report on gasoline pricing in Canada. The committee report deals with wide ranging, significant issues in a professional and constructive manner. It provides all stakeholders with a solid foundation on which to move forward.

The thrust of Bill C-235 as I understand it is to prevent the vertically integrated suppliers from squeezing the margins of their unintegrated customers' competitors in a manner which threatens the competitive viability of the unintegrated firms, generally referred to in the petroleum industry as independents.

I would also congratulate the member for Pickering—Ajax—Uxbridge for his work in preparing the bill as well as his laudable efforts to find solutions to the problems facing many of our independent petroleum firms today. His efforts are very well intentioned.

The proposed means to resolve these issues quite unhappily will not bring about the results he seeks. They will most certainly have serious adverse consequences on the Canadian economy in general and on a number of specific industries and consumers. I doubt very much that these negative effects which I will try to explain were intended by my colleague and others when the bill was drafted.

Bill C-235 contains two proposed amendments to the Competition Act. I will have to be very careful as I read this because it is complicated.

First, it would create a new criminal offence which would prohibit a vertically integrated supplier who both manufactures a product and sells it at retail from selling to a retailer who competes with it at a price that is higher than the vertically integrated supplier's own retail price, less its marketing costs and a reasonable return. The objective of the amendment would be to preclude conduct which would have the effect of decreasing or eliminating the profit margin available to an unintegrated retailer.

Second, the bill would insert an additional anti-competitive act into the Competition Act's abuse of dominant position provisions, prohibiting a vertically integrated supplier from coercing or attempting to coerce a customer who competes with the supplier at the retail level in the same market area into adhering to prices dictated by the supplier rather than allowing the customer to remain free to set his or her own retail price.

Before discussing the means by which the bill proposes to achieve these commendable goals, I feel it should be brought to the attention of my colleagues that provisions addressing both of these potentially anti-competitive behaviours are already embodied in the Competition Act and are vigorously enforced by the Competition Bureau.

Price maintenance cases, as they are known, brought before the courts involving charges of the specific coercive behaviour targeted by this bill have proven highly successful for the crown. They have led to many hundreds of thousands of dollars in fines and have deterred the repetition of the conduct in question.

Similarly, conduct by firms that have abused their dominant position in a market and which has been reviewed by the Competition Tribunal has led the tribunal to issue orders prohibiting them from repeating the anti-competitive acts, thereby restoring the level of competition in the market affected.

These provisions already exist and are vigorously enforced. I must ask why we are contemplating redundant legislation.

In order to ensure that vertically integrated suppliers are not squeezing competing retailers, the bill proposes that the government or the courts establish what acceptable marketing costs and a reasonable rate of return would be for all manufacturers in Canada. Further, for every price change in a market, no matter how often the prices may change, a manufacturer would be obliged to ensure that a competing retailer's margin has not been affected.

Prices in many markets in Canada change daily or even several times a day, depending on the level of competition and the nature of the product being sold.

I also remind my colleagues that this bill as drafted is not restricted to the petroleum sector for which it is specifically designed, but proposes amendments to an act which affects the entire Canadian economy.

I believe it will be found that many of our companies rather than cease to function under the burden of this kind of regulation will adopt a long term policy of constant prices with no opportunity for offering the various forms of discounts normally available.

This kind of price rigidity will negatively affect the ability of Canadian firms to compete against foreign competitors, will dissuade foreign investors from locating in Canada and will have a profound effect on the cost of any downstream users of the product, including of course consumers. I do not believe the proposed bill intended to lead to less rather than more competition and inhibit rather than encourage competitive pricing.

The amendments could also provide an umbrella for independents, shielding them from competition from integrated firms who are likely to refrain from retail price competition in order to escape criminal liability under the Competition Act.

In the extreme, such amendments could create a whole new set of problems by inducing integrated firms not to supply independents as a means of preserving their ability to set their own prices and limit their exposure to criminal investigation and prosecution under the Competition Act.

In either case, competition is likely to be reduced, leading to higher prices for end users, including consumers.

I refer to the words of the hon. member for Huron—Bruce who spoke in this House on May 27 of this year expressing the following concerns:

When independents are gone they will be gone forever.

Then what we will have is an uncontrollable monopoly that has the ability to unilaterally dictate price and availability to one of the country's most essential commodities. In short, there will be higher prices and fewer competitors.

Before I close I must also say that in order to properly address this very complex issue we must realize that the matter of directing legislation toward a specific industry under our Constitution is the purview of the provinces. Therefore it would behove all of us concerned about this issue to direct the effort to the provinces.

Competition ActPrivate Members' Business

1:15 p.m.

Reform

John Duncan Reform Vancouver Island North, BC

Mr. Speaker, it gives me great pleasure to speak to this bill today. The stated purpose of Bill C-235 is to establish fair pricing for products at the wholesale level. It is also to prevent anti-competitive acts such as predatory pricing and price discounting in industries where suppliers compete with their own customers.

As some of the other speakers to this bill have commented, the existing Competition Act already deals directly with the subject matter of this bill. If members read sections 78 and 50 of the Competition Act they will see that suppliers are already prevented from doing the things denounced by Bill C-235.

One of the problems with this government is that wherever it perceives a problem it thinks that the solution is to pass more legislation to fix the problem. Bill C-235 is a perfect example of this kind of behaviour. It seems that there was a perceived problem with vertically integrated suppliers fixing the price of a commodity. In other words, there is a feeling that big petroleum companies are driving small suppliers of gasoline out of business.

Because predatory pricing, price fixing and anti-competitive practices are seen to be negative activities, and indeed they are, Bill C-235 was drafted to overcome these problems. Unfortunately, in attempting to expand on sections 78 and 50 of the existing Competition Act, Bill C-235 muddies the water and complicates the issues.

The Independent Retail Gasoline Marketers Association of Canada supports the bill, saying it will be the first step in re-establishing retail competition in the oil industry. The Canadian Petroleum Products Institute does not support the bill. It says that the effect of this bill is to create a price premium for consumers to protect them from the benefits of open competition.

Which of these positions is correct? IRGMA also says that once competition is reduced through lack of public policy initiatives by any level of government the consumer will pay in the final analysis.

Reform believes that competition is essential in the operation of a free market system. However, we do not believe that competition should be artificially created and promoted. It should merely be enforced.

CPPI makes a good point when it asks: Is the proposed legislation of benefit to consumers, and by what tests has this been determined? It is not a good idea to draft, promote and pass legislation just because someone thinks it is a good idea. There must be facts and reality behind any attempt to govern what people do in business.

It seems that everyone, whether for or against the bill, is for fair competition. What we have to determine is whether this bill stands in the way of fair competition.

There is considerable concern in the business community about the way this bill is worded. Although we understand that the bill was drafted with vertically integrated petroleum companies in mind, it is not worded with those specifics. The telecommunications industry has expressed concern that there have been no studies done on the economic impact of this bill on markets and industries in Canada. Since we already have a similarly worded section existing in the Competition Act, why are we taking risks in fiddling with the wording of these sections and perhaps undermining the intent of that act, which is to promote proper competition in the marketplace?

The bill could possibly result in wholesalers and retailers communicating and agreeing on prices in order to comply with the provisions of the bill. If this occurs, the bill could actually encourage illegal price maintenance between wholesalers and retailers, exactly the opposite of its intent. It is also possible that if companies have to go to court to determine whether the provisions of this bill are being complied with, then the courts, and not competitive markets, would be used to determine fair prices. Do we really want to see this happen?

Another possible effect of this bill might be that efficiencies resulting from vertical integration could be ignored. If efficiencies in business are ignored or discounted or discouraged, consumers fail to benefit from the savings that those companies might experience.

A summary of the bill says that it would provide for the enforcement of fair pricing. We have to look long and hard whenever a government gets involved in enforcing fairness. Who decides what is fair? How do they do this? Invariably this becomes government rewarding friends and being subject to all kinds of things, such as favouritism and influence peddling.

What is true competition? How many businesses does it take to make true competition? If the point of competition is to provide price benefits to consumers, how do we determine when this has occurred? Under current provisions of the Competition Act suppliers are already prevented from price fixing, abuse of dominant position and unfair market practices.

The petroleum industry has been investigated several times by the Competition Bureau. Currently the cost to the consumer and the retailer's profits are affected by the high level of tax that exists as part of the gas price. The consumer would be much happier to see the price of gasoline drop. We all would. Naturally, the retailer would be happier to see an increase in profits.

Realistically, these things will only happen if taxes on gasoline are reduced. The resulting positive effect on industry, business and the consumer would be a more competitive marketplace.

Competition ActPrivate Members' Business

1:20 p.m.

NDP

Peter Stoffer NDP Sackville—Eastern Shore, NS

Mr. Speaker, it would be a very rare day that I would agree with anyone on the government side. However, today, on behalf of my party, I plan to definitely do that.

First I want to speak about my colleague, the hon. member for Regina—Lumsden—Lake Centre, whose riding is in the beautiful province of Saskatchewan. He has made tremendous efforts throughout his entire political and business career trying to get the gas and oil companies and governments to listen not only to his concerns and those of his constituents, but also to the concerns of Canadians right across the country.

I want to send the hon. member who is presenting this bill today kudos. Although it may not be strong enough, it is a step in the right direction and we compliment him on that.

I will speak as a consumer. I have always believed that the gas companies get away with far too much. They are much too friendly with the government of the day.

My colleague from the Reform Party says that they can look after themselves. Today in Toronto gas prices went up 8 cents per litre, just before the Thanksgiving holiday long weekend. That is an absolute outrage.

There are two people in my riding who have done an exceptional job in trying to focus this issue on the gas companies and protection not only for consumers but for jobs and independent retailers. They are Mr. David Collins, the vice-president of Wilson Fuels, and Mr. John Holm, the MLA for Sackville, which happens to be in my riding of Sackville—Eastern Shore. These two individuals have fought very hard.

I wish to read from a letter that Mr. Collins wrote to my hon. colleague from Regina—Lumsden—Lake Centre.

Bill C-235 aims to amend the Competition Act so that all market participants treat Retailers in a fair and equitable way, and ensures that wholesalers of fuel (both Refiners and Marketers who wholesale) market their fuel in a non-discriminatory fashion. Furthermore, Bill C-235 will go a long way towards breaking the oligopolistic practices of the major oil companies, and their efforts at market control through the widespread use of “Zone Pricing”.

The practice of “Zone Pricing” is frequently used to target Independent Marketers by offering certain outlets who are in close contact to Independents preferential pricing. The impact of this preferential pricing technique is to discipline smaller players into price conformance. This is why prices in Canada are routinely uniform through a region.

It is important to note that this is not the case in the United States. The reason for that is simple—the U.S. has many rules, which serve to encourage competition, and hence through the practice of increased competition—a wider choice and lower prices benefit customers. Manju Sekhri will be forwarding copies of the U.S. legislation, which applies to gasoline Marketing in the U.S., and as a comparison what we have in Canada.

We will all be startled by the disparity which exists between ourselves and our free trade partners. This important element between our two countries was left out of the free trade agreement.

I wish to get a little closer to my own riding and deal with the Ultramar plant. In 1990 Ultramar took over the Texaco plant, in the home of Eastern Passage—Cow Bay, with the assistance of provincial and government financing of $50 million. The object of that $50 million was to protect jobs and create competition in the market.

Unfortunately, the deal was for seven years. Ultramar decided in 1994 to leave town halfway through its commitment to that loan. One hundred and sixty extremely well paying jobs were devastated and gone. There was less competition within the area and not once did the provincial or the current government ask Ultramar for any of that money back. It was gone.

To throw salt into the injury, the Economic Development Corporation, which this government tends to lean on quite heavily, insulted workers and families in Nova Scotia. an oil company in the United Arab Emirates came with cap in hand to Canada saying they would like to pick off the finer parts of the refinery and shift it over to their country to create their own employment. That is an extremely wealthy nation. They could have reached into their pockets and paid for it themselves.

What did we do? We gave them $25 million of our tax dollars to dismantle the plant as well as two other refineries in British Columbia to create employment in that country. We continuously destroy jobs in this country. I am ashamed.

As part of the 1990 takeover of Texaco by Ultramar, Ultramar undertook the competition directorate to continue operating an oil refinery in Eastern Passage, Nova Scotia for seven years. In 1993 Ultramar further agreed that if it ceased operations it would give the director evidence of efforts to publicly sell the refinery.

In 1994 Ultramar gave notice of its intention to close the refinery. They did not even look for a competent buyer to buy the plant, even though we have record after record showing that there were enough buyers out there to buy the entire plant, the wharves and the docks. Ultramar refused with provincial and federal capitulation. It is absolutely scandalous that this continues. I should also say on behalf of my colleague from Regina—Lumsden—Lake Centre that if Bill C-235 does not fulfil all the aspirations of what we are looking for and what consumers are looking for, my hon. colleague also has a bill on the order paper, Bill C-384, an act respecting the energy price commission.

The bill would establish a commission to regulate the wholesale and retail price of gasoline, taking into account both the public interest in having reasonable and consistent prices and the need for manufacturers, distributors and wholesalers to have reasonable costs covered. The commission could also conduct hearings on competition in the oil industry referred to it by the competition tribunal.

In Canada we accept that some prices of goods and services which are central to the economy and often controlled by monopolies or near monopolies ought to be regulated in the public interest. That is true for telephone rates, cable TV and other prices.

I certainly cannot let something like competition go without mentioning the bank mergers. I am hoping that if we cannot get it through on the opposition side a member of the government side will bring in a private member's bill to stop and halt the bank mergers because that also would destroy competition in this country.

Independent gas retailers are small business people who promote competition and keep prices down. But they are vulnerable to the pricing practices of major oil companies. It is absolutely scandalous that this would continue.

Last summer there was a gasoline price war in the city of Moncton where things almost came to blows because gasoline was so low. All it did was be destructive. Although the consumers enjoyed it for a while in the end it was more harmful than it was good.

On behalf of Mike Williams, the head of the Atlantic Oil Workers Union of Nova Scotia, and his 160 workers who have worked so diligently to try to get a bill like this passed, I want to say to the member presenting this bill he has the full co-operation of this union and he has the full co-operation of our party in putting this bill forward.

Mr. Speaker, I wish you and your family, all members and those people in the gallery a very happy Thanksgiving.

Competition ActPrivate Members' Business

1:30 p.m.

Liberal

Albina Guarnieri Liberal Mississauga East, ON

Mr. Speaker, I commend the member for Pickering—Ajax—Uxbridge for bringing forward Bill C-235. This bill would amend the Competition Act and reverse a devastating trend against small business, entrepreneurs and the consumer.

The member for Pickering—Ajax—Uxbridge has pursued this issue for years because he sees a long established Canadian industry, our independent gasoline retailers, being pushed out of existence by unfair and predatory wholesale practices. He also sees consumers with less and less real choice and an overwhelming sense of powerlessness at the hands of the large integrated producers.

In many ways Bill C-235 is about protecting the fundamental elements of Canadian entrepreneurship. Throughout this country in every business sector there are Canadians who have mortgaged all they own to establish their own enterprise, their own business, their own job. They are determined to compete by working harder, by working longer hours, by being more innovative, by taking smaller margins and, most important, by serving the customer better.

It is these entrepreneurs who have built Canada's thriving retail sector. They have provided consumers with choice, with service, with better value. In return these retailers eke out a living for their families, are a main source of first jobs for young people and contribute to the local community through their taxes and community work.

These independent entrepreneurs are able to offer the consumer competitive choice only when there is genuine competition among their suppliers, only when they can get an acceptable margin because suppliers want business and are willing to provide product at legitimate market rates. Regrettably, this is not the case today in several sectors, most particularly in the gas industry. It is now proven beyond serious debate that integrated suppliers of gasoline have sought to forward integrate into the consumer market, not by buying successful retailers or establishing more efficient retailers but by exterminating independent competition through manipulation of wholesale prices.

Recently the stories of gas retailer being forced out of the market have been publicized because of the threat posed to all small resellers by the same practices. In one report documented in the Financial Post illustrative of the overall situation a retailer in Georgetown near Mississauga received a notice from his supplier Shell Canada informing him that after more than 65 years as a retailer of Shell products he would be cut off from any supply at all. It was not enough that his margin had been squeezed as Shell raised wholesale prices and independent look alike outlets emerged in his markets.

Clearly Shell was not satisfied with the retail market share it was winning by normal business practices and had to use its power as a producer to weaken retail competition. It is my view that we cannot allow Canadian consumers to be at the mercy of a few large integrated providers of gasoline or any other commodities. We cannot allow Canadian resellers and small entrepreneurs to be driven out of the market by predatory pricing by less efficient integrated competitors. Canada will be most productive if we reward and protect efficiency at every stage of service delivery.

If Canada's oil companies want to win 100% of the retail market they should have to win it by fair competition. They have enough natural advantages, brand names, access to capital, ability to build service centres and restaurants to fuel sales. They must not be able to win the market by squeezing out the competition by raising wholesale prices close to or above retail.

We need Bill C-235 most because the current Competition Act is failing to protect Canadians against pricing that is clearly intended to reduce their choices and ultimately increase prices where no independent competition remains.

This week again motorists in southern Ontario awoke to another holiday weekend price gouge. Yet there is nothing they can do because there are so few independents left they have no choice but to buy from one of the big integrated producers. So let us not pretend we have an acceptable level of competition even today.

I ask all members of the House to cast a vote for Canada's small independent business people and protect consumers at the same time by supporting Bill C-235. If we want to preserve a country where independent, hardworking entrepreneurs can thrive we need more legislation like Bill C-235. We need more legislation to guarantee competition, more legislation against producers and brokers constricting and manipulating supply to destroy the small retailer, and more legislation to protect consumers from being at the mercy of those industries where genuine independent competition has already gone extinct.

It is time to send a message that this House will always put consumers first and will act decisively whenever confronted by an industry that abuses its position in the market to deprive Canadians of the competition.

Let me close by commending once again the member for Pickering—Ajax—Uxbridge for his unbending resolve on this issue in the face of an intense lobby. Consumers need this kind of initiative to put the spine back into competition laws in Canada.

Competition ActPrivate Members' Business

1:40 p.m.

Progressive Conservative

Gilles Bernier Progressive Conservative Tobique—Mactaquac, NB

Mr. Speaker, it gives me great pleasure to speak to Bill C-235, a bill that if passed would have a profound effect on the way companies do business in Canada. The bill is sponsored by the member for Pickering—Ajax—Uxbridge, the chair of the Liberal caucus committee on gasoline pricing. Since its inception last September, the committee has conducted a number of meetings across Canada to receive comments on gasoline prices.

This bill is similar to the bill introduced by the same member in the 35th parliament. It was then known as Bill C-381. In reality the member's intent to adjust the Competition Act with this bill is born from the fact that in several complaints to the competition tribunal, independent retailers have been unable to prove either of the following infractions took place, predatory pricing or abuse of dominant position.

Instead of accepting that there is a competitive unregulated market, Bill C-235 seeks to skew the playing field in favour of the independents. Occasionally it is warranted for the Parliament of Canada to intervene in the marketplace. However, in this situation we have to ask if Bill C-235 as it stands is such a reasonable intervention.

In order to judge the merits of the bill we need to look at the potential impact of the bill. My colleague, the member for Markham, addressed the point that the infractions the bill seeks to address are already covered by the present Competition Act. Section 50(1)(c) of the act already deals effectively with potential predatory pricing. Section 61 deals with price maintenance. Section 78(a) addresses price squeezing by vertically integrated companies.

Now that we have established that the act as it stands already addresses the member's concerns, let us discuss what ramifications could result from Bill C-235. The fundamental problem with this bill as seen by the Progressive Conservative Party is its blatant manipulation of basic free market principles.

In this case the bill would create a regime whereby gasoline pricing would be set based on a formula that would include a combination of market forces and a provision for a minimum profit margin. Clause 50.1(2)(a)(ii) would allow the courts to interfere in what constitutes a reasonable profit. This situation is worsened by the fact that the bill would entrench certain conditions between vertically integrated suppliers and their customers. Whether or not governments should be interfering in that relationship at all is certainly a point for debate.

However, the issue that most disturbs me is that this bill completely disregards any efficiencies that arise from vertically integrated companies. For example, Imperial Oil would fall under the definition of a vertically integrated supplier. It operates refineries, it has its own retail outlets and it sells to independents that are its competitors. Under the terms of Bill C-235 it would not be permitted to pass on savings realized by its economy of scale to its customers without doing two things. First, it would have to ensure that its price reduction was in compliance with Bill C-235, a decision that would have to be adjudicated by the competition bureau. Second, it would have to make a corresponding reduction to any competitors that buy from it.

Advocates of this bill have come to the conclusion that this is fair and proper. However, I respectfully submit they are living in a fantasy world. A more reasonable expectation would be that Imperial Oil would make a smaller price reduction if any were made at all. That way it could remain compliant, the independents would receive a small benefit and the consumers would lose. This point needs to be stressed.

Different spokespeople for Bill C-235 have tried to sell it as a bill that would protect independent retailers as well as consumers. The harsh reality is that consumers would only be victims under this bill.

I want to go a step further with my analogy. Another possible outcome of the situation facing our analogous company, Imperial Oil, could be a decision on its part to discontinue supplying independents altogether. If it is no longer a vertically integrated company, it would not have to deal with the Competition Bureau every time it wanted to lower its prices, offer coupons or give away a two litre bottle of pop. This is not an unreasonable outcome to predict, and it would be the exact opposite effect of what the bill's sponsor is trying to achieve.

My party has spoken to many stakeholders on this issue and through those interviews we have come to learn a great deal about the whole industry. Several years ago Canada and its provinces began moving from a regulated to an unregulated gasoline industry. Instead, we have preferred to maintain general rules of competition, as embodied in the Competition Act. This situation does not exist in the United States and as a result rules change from state to state. I am sure my hon. colleague can understand what kind of inefficient marketplace this creates.

There can be no doubt that the result of Bill C-235 will be to increase gasoline prices across this nation by creating an artificial profit margin. This quite frankly is legislated protection of inefficiency.

Up to this point my comments have focused on the oil industry and I have done so for a reason. This bill has been developed to specifically target that industry. Unfortunately, just as indiscriminate tuna nets catch dolphins, this bill will impact many other industries.

One aspect that should disturb us all is that if passed we would enter a new retail environment, one where wholesalers and retailers would be encouraged to communicate and agree on retail prices in order to comply with provisions of the bill. The result would be an increase in the likelihood of illegal price maintenance clauses. That is not my opinion but instead the reasoned opinion of the president and CEO of the Stentor Company.

The letter also goes on to concur with what my colleague, the member for Markham, said in this House previously. Bill C-235 will create another level of bureaucracy with inefficient, burdensome compliance regulations. The following point bears repeating. The courts will be used to determine prices and margins and not market forces. This would have to be the case because no definition exists for the bill's provision of what constitutes a reasonable profit.

The last point I want to make is that we have in existence right now a comprehensive world class Competition Act which was enacted as such by the previous Conservative government in 1986. I take this opportunity to assure my hon. colleague that the foresight of that government saw to it that necessary protection for all sizes of companies was implemented.

The act covers perdition, pricing with the express purpose of destroying a competitor. It covers below cost selling. It covers abuse of dominant position.

In short, there is nothing in Bill C-235 that is not already effectively and fairly addressed by the act. Legislation that benefits only special interests and not the whole marketplace cannot be supported. Therefore we will be voting against Bill C-235 in its present form.

Competition ActPrivate Members' Business

1:45 p.m.

NDP

Peter Stoffer NDP Sackville—Eastern Shore, NS

Mr. Speaker, I rise on a point of order. I beg the indulgence of the House. I forgot to wish my mom and dad who are watching a very happy Thanksgiving.

Competition ActPrivate Members' Business

1:45 p.m.

The Deputy Speaker

I am sure all hon. members join the hon. member for Sackville—Eastern Shore in that expression.

Competition ActPrivate Members' Business

1:45 p.m.

Liberal

Dan McTeague Liberal Pickering—Ajax—Uxbridge, ON

Mr. Speaker, I have heard a lot from all sides of the House. I know there are members who feel very passionately about this. Those happen to be the very members who have actually taken the time to study this, who have not allowed CPPI or an oil company or the Competition Bureau to help them write their speech or to find out some kind of mythical idea about what this industry is all about.

The member for Tobique—Mactaquac and his colleague from Markham are good examples of people who simply do not want to engage in a real cerebral discussion of what this bill is all about. That is exactly why they do not want it to go to committee.

That member who comes from New Brunswick made a statement about the fact that everything is hunky-dory in this industry. He should look at the New Brunswick select committee all-party resolution of that province last year which indicated that we needed effective laws dealing with predatory pricing that currently do not exist.

I want to get into the Stentor question because Stentor has written a letter expressing surprise that it was possible for the Competition Bureau to go around looking for people to find opposition to the bill. It is kind of ironic that it is this bill which is in fact giving them the tools to resolve the problem that exists. Stentor may have a huge problem with respect to the power of the vertically integrated suppliers that relate to the Internet service provider.

The opposition is correct that the bill was about the oil industry, but it seems to me there are a lot of other industries and small businesses, which the people on the other side wish to advocate, that are being decimated day in and day out. That is not hypothetical; that is reality.

With respect to the retail industry, we are asking in Canada to do what the parent companies cannot do in the United States. The legislation is designed very specifically to bring the Competition Act up to speed with the rest of the world before we recognize that in Ontario, where gas prices have increased by eight cents a litre, it is not a function of competition.

I do not know what it takes for members of parliament to try to understand this issue. There were 20,000 retailers a few years ago. There are less than 10,000 now. There will probably be fewer in days to come.

Consumers across the country know that when gas prices move up uniformly or fall uniformly it is a function of the wholesalers that have absolute control over the retail price. They are not separate. They are not segregated. The bill simply tries to address a safeguard which, in summation, was the recommendation of the Competition Bureau in 1986.

I ask the House to put aside the biases, the willingness to play politics, to stand up for small business and to stand up for the truth. At the end of the day that would ensure what we do not have today in the oil industry in Canada, a truly competitive Canadian market.

Competition ActPrivate Members' Business

1:50 p.m.

The Deputy Speaker

It being 1.52 p.m., the time provided for debate has expired.

Pursuant to order made earlier today, the question on the motion is deemed to have been put and a recorded division deemed demanded and deferred until Tuesday, October 20, 1998, at the expiry of time provided for Government Orders.

May I join with hon. members, who expressed their wishes for a good Thanksgiving to our colleagues, friends and the people watching, to extend the very best wishes for the weekend from me and the other chair occupants. I look forward to seeing hon. members on our return after a week of constituency work, which I know members will enjoy.

It being 1.53 p.m., the House stands adjourned until Monday, October 19, 1998, at 11 a.m. pursuant to Standing Orders 28(2) and 24(1).

(The House adjourned at 1.53 p.m.)