Bill C-56

Affordable Housing and Groceries Act

An Act to amend the Excise Tax Act and the Competition Act

Part 1 amends the Excise Tax Act in order to implement a temporary enhancement to the GST New Residential Rental Property Rebate in respect of new purpose-built rental housing.
Part 2 amends the Competition Act to, among other things,
(a) establish a framework for an inquiry to be conducted into the state of competition in a market or industry;
(b) permit the Competition Tribunal to make certain orders even if none of the parties to an agreement or arrangement — a significant purpose of which is to prevent or lessen competition in any market — are competitors; and
(c) repeal the exceptions in sections 90.1 and 96 of the Act involving efficiency gains.

Opposition Motion—Measures to Lower Food Prices

[Sukh Dhaliwal, Liberal, Surrey—Newton, BC]

Mr. Speaker, I want to thank the hon. member, who has been a good friend for many years.

In terms of the bills I already mentioned, whether it is Bill C-56 or Bill C-59, we are going to make sure that they bring in legislative measures and give more powers to the bureau and the controllers. In that way, they will be able to control those subsidies, including the one that the hon. member is talking about.

[Sukh Dhaliwal, Liberal, Surrey—Newton, BC]

Mr. Speaker, I am happy to participate in this debate on the NDP motion submitted by the hon. member for Cowichan—Malahat—Langford in relation to the price of essential foods and the conduct of grocery giants, such as Loblaws, Metro and Sobeys.

The proposed motion is timely, because by voting in favour of Bill C-59 last week, this House approved the latest initiative in the government's comprehensive modernization of the Competition Act. The relevant clauses were approved unanimously, showing the strong consensus here in this chamber on these issues.

The truth of the matter is that the government has been extremely active in promoting competition in all sectors of the economy, including in the grocery retail industry. It begins with resourcing. In budget 2021, the government increased the Competition Bureau's budget by $96 million over five years and $27.5 million ongoing thereafter. The increase in resources was a much needed boost to the bureau's capacity, and in its own words, “These funds enhance our ability to enforce the law and advocate for more competition. They help ensure we have the right tools to deal with Canada’s competition challenges now and in the future.”

Needless to say, law enforcement will not be effective if the enforcers are not able to carry out their tasks, and that is why this extraordinary increase was crucial to the bureau's functioning. The next step had to do with the legal framework under which the bureau operates, the Competition Act, which was aging and falling short compared to our international partners.

Through the 2022 budget bill, Bill C-19, we took the first step in remedying this, correcting some of the obvious issues. This included criminalizing wage-fixing agreements, allowing private parties to seek an order for abuse of a dominant position and raising maximum penalty amounts to be based on the benefits of anti-competitive conduct. This ensures that sanctions would no longer be a mere slap on the wrist for today's largest economic actors.

The government knew, however, that much more remained to be done. Where the solutions were less readily obvious, the minister turned to the public process, launching a comprehensive public consultation on the future of Canada's competition policy. The process ran from November 2022 through March 2023.

In response to a consultation paper released by Innovation, Science and Economic Development Canada, over 500 responses were received. This consisted of over 130 from identified stakeholders like academics, businesses, practitioners and non-government organizations.

While this feedback was being received, government officials also met with stakeholders in round table groups, allowing them to voice their views and to interact with each other as well. Stakeholders were not shy about sharing their opinions with us. They knew what sorts of outcomes they wanted to be delivered.

There was no shortage of proposals made, some highly concrete and detailed, others more directional in nature. What we heard, however, is that Canadians wanted more competition. Across many domains, the desire to strengthen the law, to enable the bureau to act and to align with international counterparts was evident.

Of course, many also expressed reservations about ensuring we get the details right and warned about overcorrection. The government took those to heart as well, taking inspiration from examples in other jurisdictions and recognizing the careful balancing that must be done when developing new legislation.

All told, the results of the consultation can be seen in two pieces of government legislation.

First, Bill C-56, the Affordable Housing and Groceries Act, was adopted in December 2023. It took some of the largest issues off the table. It eliminated the “efficiency exception”, which allowed anti-competition mergers to withstand challenge. It revised the law on abuse of dominant position to open up new avenues for a remedial order. It broadened the types of collaboration the bureau can examine, including those that are not formed between direct competitors. It established a framework for the bureau to conduct marketing studies, including the possibility of production orders to compel information. Work on this last amendment is already under way, as the bureau has announced an intention to launch a study into the passenger air travel industry.

Bill C-59, the fall economic statement implementation act, 2023, is the second legislative effort following the consultation. As we know, it is currently before the Senate, and the government looks forward to its quick adoption. The amendments to the Competition Act that it contains are incredibly comprehensive. I will provide some of the highlights.

The bill makes critical amendments to merger notification and review to ensure that the bureau is aware of the most important deals and would be able to take action before it is too late. It significantly revamps the enforcement framework to strengthen provisions dealing with anti-competitive agreements, and it broadens the private enforcement framework so that more people could bring their own cases before the Competition Tribunal for a wider variety of reasons; in some cases, they could even be eligible for a financial award.

Bill C-59 also helps address important government priorities by making it harder to engage in “greenwashing”, which is the questionable or false representation of a product or a business’s environmental benefits. It facilitates useful environmental collaboration that might otherwise have been unlawful. It helps to make repair options more available for consumers by ensuring that refusals to provide the necessary means can be reviewed and remedied as needed.

Finally, overall, Bill C-59 makes a number of critical but often technical updates throughout the law to remove enforcement obstacles and make sure that the entire system runs smoothly.

I cannot overstate how important these measures are. The competition commissioner has referred to this as a “generational” transformation. It is by far the most significant update to the law since the amendments in 2009, following the recommendations of the competition policy review panel; arguably, it is the most comprehensive rewrite of the Competition Act since it first came into effect in 1986. Our world has changed since then, and it became clear that the law needed to keep pace to enable institutions that can oversee fast-changing markets and landscapes.

After the passage of Bill C-59, we can guarantee that our competition law will work for Canadians in markets such as the one under scrutiny here, as well as the many other markets throughout our economy.

I am thankful for having been given the opportunity to share a few words.

[Adam van Koeverden, Liberal, Milton, ON]

Mr. Speaker, I apologize; that was completely unintentional. If you will indulge me, I will start from the top and eliminate the name.

I want to thank the page for the podium here and say that I am very grateful for the opportunity to respond to comments made earlier by the leader of the New Democratic Party regarding the actions that our government is taking to address the very real food affordability challenges that Canadians are experiencing. That includes my neighbours, friends and family in Milton, Ontario.

We have an obligation to ensure that all Canadians have access to food and other daily essential goods. I said yesterday in the House of Commons that it is not as though Canadians can simply buy less food. Food is an essential item and needs to be affordable in our country.

Our government has been actively engaged and committed to improving affordability across the board with the view to alleviating the financial stress that is placed on Canadians. While we are doing that, we are addressing the growing costs of essential goods, including groceries. That requires a very strong consumer advocacy sector as well as timely and independent research on consumer issues. That is why our government is targeting enhanced support for Canadian consumers through additional investments in consumer advocacy work.

Yesterday I was talking about the value and the potential for more ombudspeople in the grocery sector to do research and conduct a bit of introspection with respect to why grocery prices are so high these days. Everybody seems to have a theory or some kind of an idea as to why grocery prices are inflated, but there are different reasons, and very complex reasons actually, because everything we shop for at the grocery store comes from somewhere else these days.

We announced in October 2023 that our government would be tripling our investment in Innovation, Science and Economic Development Canada's contributions program for non-profit consumer and voluntary organizations. That program's funding was increased to $5 million annually. The additional funds are allowing organizations which advocate directly for the rights of consumers to examine existing and emerging business practices that can be harmful to Canadians, while also recommending actions to improve affordability, increase grocery competition and build on existing government efforts to promote and protect the interests of Canadian consumers.

It is absolutely and abundantly clear that grocery chains in Canada have taken advantage of consumers at various times. The very fact that we have an uncompetitive, consumerist and capitalistic approach to selling food, an essential item in this country, raises eyebrows. As somebody who grew up in non-profit housing, I have to wonder whether there is not more space for non-profit groceries. That is not to suggest that we would not support the workers in those stores, and we would certainly continue to support agriculture workers, farmers and food producers. However, there is a lot of value in removing profit from the essentials.

As a co-op kid, I never hesitate to talk about the value of non-profits. There is one non-profit organization in my riding about whose incredible work I would like to speak: Food for Life, a local charity and organization, a community-serving group that rescues food. In fact, it purchased a couple of refrigerated trucks with support from the federal government. That means that people from the organization can arrive at a grocery store they have contracts with, and before food comes off the shelf and goes into the landfill, the Food for Life experts go in and remove food from the shelves.

Food for Life is supporting the affordability for Canadians on two levels. One, the disposal of food costs grocery stores a lot of money, so they can actually eliminate that cost, which would be passed on to the consumers who shop at the store. Also, the organization is removing high-quality food that will not be sold for one reason or another. I have a lot of feelings about best-before dates. My partner and I often argue about what food has gone bad. I am the type of person who cuts a bit of mould off cheese, grates up the cheese and puts it on my pasta. It does not bother me too much. Perhaps my partner feels a bit differently about cheese mould.

Food for Life and the experts there do an amazing job rescuing food, putting it on shelves, packaging it, storing it and freezing it, and they actually have two free grocery stores. It always raises eyebrows when I tell people that my riding, my region, has two free grocery stores. Anybody back home listening can google “Food for Life in Halton”. People can drop by one of their grocery stores. They have excellent variety: fruit, vegetables, meat, bread and all the essentials.

All that the experts at Food for Life ask for is just a tiny bit of information, nothing terribly intrusive, just so they can continue to serve our community better. I am proud to say that I am a monthly donor to Food for Life. Anybody who is interested can examine the pathway of food waste and how we can redirect food waste toward people who really need it. I just want to stress that the invaluable, incredible work of Food for Life Canada in Halton is doing just that.

Let us go back to some of the projects that our government is funding to further explore barriers to grocery competition in the Canadian context. We have assisted in funding some studies that were completed by the Competition Bureau. It reported that existing barriers in the Canadian grocery sector context include “restrictive covenants” and “property controls”, and retail contracts that limit our control on how real estate is used by competing players in the grocery industry.

Our government is committed to reiterating our commitments to enhancing affordability for Canadians, as demonstrated by our investment through budget 2024. We understand the cost pressures that Canadian families are facing, and they often start with the price of food. That is why budget 2024 launched a national school food program in Canada, the first of its kind, and it will help ensure that more than 400,000 children have access to healthy meals and snacks, so they can remain focused on learning and growing while in class.

I have visited a lot of amazing school food programs. They basically do boxes where they take snacks out of packaging and create little hampers that go to the classrooms. That is to ensure there is a healthy snack available to any kid who might be a little hungry.

There are a lot of reasons a student might be a little hungry, or having a snack attack. It might be because they forgot their lunch at home. It might be because their banana got squished in their bag and they did not want to eat it. It could be because of time poverty; some families just run out of time. Sometimes we forget our lunch. Sometimes it is an affordability challenge and sometimes it is a time poverty issue. Sometimes it is a convenience issue. However, none of those reasons should get in the way of making sure a young kid or student has access to a healthy snack.

I want to give Halton Food for Thought a shout-out and Food4Kids Halton, as they are amazing organizations. The volunteers, the teachers and the parents who show up, and everybody who purchases food for or donates food to these programs, are all saints and I just want to say I appreciate them.

A national school food program will nationalize that and ensure that it does not always just rely on goodwill, donations and volunteers. We are going to ensure that all schools have access to it. It is definitely the case that schools in higher-income neighbourhoods tend to have more volunteers, and they often have more services. We do not want schools in lower, more modest-income neighbourhoods or communities to not have access to these essential programs.

I am really glad that our government is taking the extraordinary step of starting a national school food program. I think 400,000 kids is a lot of kids, and that is a great program and a great way to ensure that young people and students are not going hungry while they are in class.

Our government also believes that a lack of competition in Canada's grocery sector means that Canadians will ultimately pay higher prices to feed themselves and their families. We have actually seen that. It was not that long ago that Loblaw Companies sent out, in Ontario at least, those little $25 gift cards to anybody who went online and signed up. That was sort of its sorry for fixing the price of bread for over a decade. There was a big lawsuit and Loblaw basically said, “Sorry, we were fixing the price of bread. We will make amends by sending everybody 25 bucks.”

As sort of an act of protest, I spent my $25 at Loblaws. I remember doing that, but I think that did not really make up for the fact that it was working against customers. Where we shop is democratic: With our dollars, we want to support companies that have the best interests of their consumers in mind. I believe in customer service and I also believe that companies have a duty to respect their customers. It would be great to see more of that.

Let us go back to some of the significant efforts the Liberals have deployed to ensure that Canada's competition laws are fit for the modern economy. We have also brought forward important amendments to the Competition Act through Bill C-56, and that is the affordable housing and groceries act. These amendments would give further enforcement powers to the Competition Bureau to prevent anti-competitive mergers and to address competition-stifling practices in large dominant players.

It is clear when there is not enough competition in a market. If there is only one store in a community, then it can basically charge whatever it wants. Even when there is more than one store, we can see some of the unfair corporate practices that target more vulnerable communities. Oftentimes, there is a smaller store, like a Shoppers Drug Mart or a convenience store, that is within walking distance to affordable housing. However, with some of the bigger stores, the more discount grocery stores, people require a vehicle to get to them.

In some of those smaller stores, we will see a higher price for the exact same item. I have seen it myself. A can of tomato soup is $2.49 at Shoppers Drug Mart, but if one goes to a No Frills, and it is on for $1.29. Both stores happen to be owned by the same company, so that is an unfair practice. I am not going to be convinced that the shelf cost of an item in one store versus another is actually double.

Finally, our government has made it a priority to maintain something called the food price data hub to give Canadians up-to-date and detailed information on food prices to help them make informed decisions about their grocery options. I am happy to elaborate on the food price data hub in a question.

[Matthew Boswell]

My understanding is that, with the changes to the law from Bill C-56, we consult on the terms of reference, which we have out there now, as you rightly point out. Once we hear input from Canadians—and I can tell you that we're getting a lot of input—we then may amend the terms of reference, depending on points that people have made in our consultation. We then provide the terms of reference of the study to the minister

[Ryan Williams, Conservative, Bay of Quinte, ON]

Thank you. It's a brief question.

Commissioner, thank you for coming today. I know you're starting an airline industry study. The public submission deadline is June 17. These are the new powers by Bill C-56, so we're just testing those out.

One concern we have is that there's a letter written by the industry minister that says “to focus on domestic...airline services”, not airports. Obviously, we think you should be looking at the whole thing. Airport competition is just as important as the domestic side.

If that comes back, do the powers through Bill C-56 allow the minister to change the course of the study after we've reviewed it or after you've gotten the public consultation on the 17th, yes or no?

[Matthew Boswell]

Thank you for that very pragmatic question. I was hoping to have an opportunity to address that head on.

From the Competition Bureau's perspective, as I said in my opening comments, we're really pleased with the attention that's been paid to competition in this private member's bill, and other private member's and government bills to amend the law. I agree with Professor Larouche. It was probably too complex out of the gates in 1986, when it was, some say, drafted by the business community.

In terms of this bill, from the Competition Bureau perspective, I would say that we don't need to address clauses 2, 3, 5, 6, 7, 8, 9, 10 and 11. Clause 4, which deals with the penalty provision for federal financial institutions, is great in terms of the 14 years, but it should be a fine at the discretion of the court—not a maximum fine, the $25 million that it has now.

On clause 12, the bureau believes—and we put this in our recommendations to ISED—that a three-year limitation period for notifiable transactions is a good step forward. Right now, it's only one year. With our colleagues in the United States, there's no limitation period on reviewing mergers.

Finally, with respect to the costs award, that has been addressed in Bill C-59, but I would just point out that in our submission to ISED, we talked about full immunization. Bill C-59 is a pretty reasonable balance so, one way or the other, we're pretty happy with how that comes out. Really, quite strongly, we don't believe that we need those other clauses. They've been addressed in Bill C-19, Bill C-56, and hopefully soon in Bill C-59, but this has been a valuable contribution to the debate and the marketplace of ideas.

[Jean-Denis Garon, Bloc, Mirabel, QC]

Thank you, Mr. Chair.

First, welcome to all of you. It is kind of you to be here today with us.

I want to come back to your testimony, Professor Larouche. We are studying bills here whose purpose is to improve the competition regime, such as Bills C‑56 and C‑59. As you said, there are always additions that seem to have a lot of merit, but they are always minor additions.

What I understand from your testimony is that there are two ways of reforming the Competition Act. The first would be to establish a very clearly defined framework that would give the competition commissioner a lot of latitude, and the second would be to add interminable conditions, which would give the impression of action but would ultimately make the law so complicated it ceased to be functional.

Recently, I spoke with some people about the case of the United States in connection with the structural presumption question. They told me that in the United States there was a presumption in favour of consumers, and that in some cases the competition authorities did not necessarily have to justify their decision to the extent they have to do here in Canada. It would seem that this makes the regime more flexible and faster and reduces the volume of potential appeals, since it provides better protection for consumers. We know that consumers have very diffuse interests, while the interests of corporations, which have resources, are concentrated.

Could this presumption in favour of consumers be adopted into the Canadian competition regime?

[Antonio Di Domenico, Secretary, Competition Law and Foreign Investment Review Section, The Canadian Bar Association]

Thank you, Mr. Chair.

I want to express appreciation on behalf of the CBA section for the invitation to appear today. Our members have significant experience advising a wide range of clients in competition matters. We appreciate the opportunity to be heard, so thank you for that.

By way of overview, many of the issues addressed in Bill C-352 have either been addressed in Bill C-56, which received royal assent in December 2023, or contained in Bill C-59, which is currently before the Senate. I would like to speak today regarding two proposals in Bill C-352. namely, the merger prohibition and structural presumption provisions, at clauses 8 and 9 of the bill; and the inclusion of efficiencies as a factor when assessing competitive effects for mergers and civil competitor collaborations, at clauses 7 and 10 of the bill.

Beginning with the merger and prohibition provision, Bill C-352 would create an arbitrary bright line precluding Canada's Competition Bureau and the Competition Tribunal from evaluating the competitive effects of mergers with a combined market share at or above 60%. The proposal would not take into account or differentiate between any level of increased concentration, even if the acquired target had, for example, a share of 1%.

This would be unprecedented and would make Canada a global outlier. Competition and antitrust laws globally recognize that market share and concentration alone are not themselves determinative of market power and competitive effects. As the Competition Act already recognizes, a conclusion regarding the competitive impact of a merger must evaluate such important factors as the likelihood of entry and expansion, the role played in the market by the acquired entity, the presence of other vigorous and effective competition in a market, and the nature of change and innovation in a market, among other things. In our submission, it would be inappropriate to fetter the ability of the Competition Bureau and the Competition Tribunal to conduct an analysis of market power and competitive effects based on the facts and evidence before them.

Bill C-352's emphasis on market share and concentration to the exclusion of other factors also presents three further significant problems.

First, the approach would remove entirely the analysis of what matters most, which is competitive conditions pre- and post-merger, in favour of a focus on just market share statistics that are not themselves determinative of market effects.

Second, in many cases a factual conclusion regarding market share cannot be reliably drawn based on a company's current market share.

Third, merging parties frequently do not have the requisite data to determine what their market share is in any relevant antitrust market. The Competition Bureau collects such information as part of its review, but unless the bureau plans to share this information with merging parties or their counsel as part of the enforcement process, which they don't currently do unless required to in litigation, significant due process concerns arise for merging parties.

Turning to the structural presumption provisions, the CBA section does not support the inclusion of structural presumptions in the Competition Act. We agree that concentration and market share levels can provide a useful preliminary screening mechanism to identify potentially problematic mergers. However, we disagree that a merger should be presumed to cause anti-competitive effects on the basis of market share alone.

Further, including structural presumptions in the Competition Act, a statute, will not harmonize Canadian law with U.S. law. This is important. In the U.S., structural presumptions were introduced in non-statutory enforcement guidelines, which are flexible in nature and are preferable to a fixed statute. It's not part of any U.S. legislation. If structural presumptions are introduced, we would submit that the appropriate place to introduce them would be in the Competition Bureau's merger enforcement guidelines, similar to the approach that continues to be taken in the U.S.

Finally, turning now to efficiencies, Bill C-352 proposes the inclusion of efficiencies as an explicit statutory factor in sections 93 and subsection 90.1(2) of the Competition Act when assessing whether a merger or a civil competitor collaboration would likely substantially lessen or prevent competition.

The CBA section agrees with this inclusion. It's well recognized in Canada and globally that efficiencies are a relevant factor when assessing competitive effects, because they can result in mergers or competitor collaborations being pro-competitive, enhancing productivity and benefiting consumers. The Competition Bureau has advocated for efficiencies to be among the list of factors that the Competition Tribunal can consider when assessing competitive effects. This change would also reinforce the bureau's current approach when assessing the competitive impact of mergers and civil competitor collaborations, in any event.

Thank you for the opportunity.

[Matthew Boswell, Commissioner of Competition, Competition Bureau Canada]

Good afternoon, Mr. Chair. Thank you for the invitation to appear before you today.

My name is Matthew Boswell and I am the commissioner of competition. With me is my colleague Anthony Durocher, who is the deputy director of the competition promotion branch.

We are pleased to be here today to discuss Bill C‑352. As a result of several pieces of legislation, competition policy in Canada is undergoing a generational upgrade. We are grateful to the members of this committee and other people who have particularly stressed the need to strengthen competition in the Canadian economy.

As you undoubtedly know, most of the important points in Bill C‑352 have been incorporated into past and future legislation: Bills C‑19, C‑56and C‑59. Those amendments give effect to a large number of recommendations by the bureau and better harmonize our competition framework with the best international practices.

Just as competition in the marketplace forces firms to offer products and services that better meet consumer needs, competition in the marketplace for ideas leads to better public policies. In my view, the sponsors of Bill C-352 and other private members' bills introduced this session deserve credit for prompting substantial improvements to the Competition Act. These improvements include, among other things, a significant revamp of our abuse of dominance provisions, including stronger penalties, the addition of rebuttable structural presumptions in merger reviews and stronger remedies for anti-competitive mergers, the possibility for formal market studies to be initiated by the commissioner, and insulating the commissioner of competition from adverse cost awards at the Competition Tribunal.

By my count, there are only a few outstanding elements of Bill C-352 that have not been taken forward already in other legislation. In the grand scheme of competition law modernization that has taken place, the remaining issues are not of pressing concern, but certainly, some of them could further enhance the Competition Act. We would be happy to discuss those few elements.

There are also some aspects of the bill that would, in my view, represent a step backward, given prior reforms, such as the reintroduction of a cap on cartel fines. We would be happy, of course, to discuss those as well.

During our time today, or perhaps in a future appearance before this committee, it might also be productive to discuss what I often refer to as the elephant in the room in Canada. That is regulatory barriers to competition in this country.

The Competition Act is a foundational tool to protect and promote greater competition in Canada, but it is not the only tool. To build on the incredible progress made in modernizing the Competition Act, all of us in the public sector, at all levels of government, need to examine what more can be done to address the regulations and policies that hold back competition in Canada, often unintentionally. We know that Canada’s competitive intensity has decreased over the last two decades. It will take a whole-of-government approach to turn the tide, with the federal government working alongside municipal, provincial and territorial governments.

Increased competitiveness is key to tackling affordability challenges, improving consumer choice and fostering stronger, more inclusive growth over the long term and, importantly, addressing Canada’s pressing need for more productivity.

Competition policy in Canada is clearly having a moment. We need to seize that moment. There has never been a stronger consensus that Canada needs more competition. Now is the time for governments across Canada to work together to make competition a national economic priority.

In conclusion, the competition bureau is determined to apply the law in a transparent and evidence-based way. We have been unwavering in our efforts to implement the new and improved tools that Parliament has given us, and we will stay on this course.

Thank you for giving us the opportunity to appear before you today.

It will be our pleasure to answer your questions.

Thank you. We look forward to your questions.

[Dr. Pierre Larouche, Professor, Law and Innovation, Faculty of Law, Université de Montréal, As an Individual]

Thank you, Mr. Chair.

Thank you for this invitation to appear before your committee.

Allow me to introduce myself briefly. I am a full professor of law and innovation in the law faculty at the Université de Montréal. I have 30 years' experience in competition law and economic governance, partly in private practice, but mainly as a professor of competition law in Europe. I taught in Europe for 15 years. At the College of Europe, I taught a number of European Commission officials who work on major competition cases. I taught American competition law during a sabbatical year at Northwestern University. For the last seven years I have been at the Université de Montréal, where I continue to work in this field. I am back in touch with Canadian law.

It is a pleasure to speak to you this morning. I would like to start with a slightly theoretical comment on all of this. There are a lot of good intentions behind the proposed amendments to the Competition Act, such as Bill C‑56, which has been passed, and Bill C‑59, which is under consideration. However, if we compare Canadian law to the law of other member countries of the Organization for Economic Cooperation and Development, the OECD, it stands out in two regards: first, the act is very long and very complex; second, the institutional framework is deficient. As a result, Canadian competition law is weak and difficult to enforce. The defendants, the corporations, will be easily able to defend themselves, and they will generally succeed in avoiding enforcement.

Since the act is long and complex, it is my opinion that we have to stop adding details to it. Instead, we need to go back to broad principles, take clear broad policy positions, and give the commissioner and the competition bureau more room to do their work.

Regarding the institutional framework in Canada, the bureau should have decision-making powers the way it is done everywhere in Europe, even in the United Kingdom, and, in part, for the powers of the American authorities. I think that if we look at what has happened recently in Canadian law, especially with the merger between Rogers and Shaw, the tribunal was the main problem. It should have acted only as an appeal body or, even better, should do judicial review on the basis of a decision of the bureau.

I am now going to talk about the two more specific questions that concern you today regarding Bill C‑352, which Mr. Singh referred to earlier. Increasing penalties under section 45 is a good idea in itself, but again, this shows how complex the Canadian law is, forcing a choice between sections 45 and 90. Obviously, the penalties need to be high under section 45, but that is criminal law and it is not as easy. An appropriate penalty, as mentioned here, would be 10% of worldwide revenues. Ideally, if we look at the practice of the European Commission and the American authorities, the level of the penalty should be about the same as the level of the corporation's profit for it to really hurt; it is generally about 5% to 6% of revenues. By adopting a maximum penalty of 10%, Canada is in the right league, and that means that the penalties should easily amount to hundreds of millions of dollars.

However, regarding the second proposal, the market share thresholds for controlling concentrations, I think that is a reference point that is a bit outdated. It is preferable to have a good general test and let the bureau do its work. Market shares may cause errors in both directions. First, there may be the exceptional case of a merger with high market shares where it would still be possible to prove that it is good for consumers. Second, and most importantly, there are also mergers with lower market shares that may be harmful to consumers, for example where the two merging parties are close competitors in the market.

These are factors that are definitely part of the contemporary analysis of competition law and that cannot be addressed in terms of market share thresholds, which obviously create the illusion that the only problem arises out of horizontal mergers, when vertical mergers, or conglomerate mergers, can be just as problematic.

Those are my introductory comments.

Thank you again for hearing me today.

[Jagmeet Singh, NDP, Burnaby South, BC]

I would first point out that the changes in both Bill C-56 and Bill C-59 were amendments specifically brought in by the NDP to address higher penalties and anti-competitive behaviour. Those amendments were successful, and we're happy that we were able to push for those things.

The same approach to anti-competitive behaviour is not being mirrored by the approach to price-fixing. It is not the same approach. Even when you cited Bill C-19, it doesn't have the same rigour when approaching anti-competitive behaviour as when approaching price-fixing.

Specifically, when I talk about price-fixing, we're talking about the situation when corporations collude, work together or have a conspiracy to set prices higher together. Specifically what I'm referring to is the bread price-fixing. That matter, the bread price-fixing, has not been addressed. It is one of the most egregious recent examples of large corporations ripping off Canadians. That specific matter has yet to be addressed. What I'm calling for are clear penalties that address that matter. That is the area where we suggested amendments that the Liberals turned down.

The Liberals have not shown a willingness to go after what has been the most egregious recent example of corporations working together to rip off Canadians, which is when they colluded to rip off Canadians with the price of bread. That's what I'm going after, and that has not specifically been addressed.

We are setting a guideline for penalties to address the matter. The $50 million fine, which was the highest fine on one of the most egregious cases, was far too low. It was barely a slap on the wrist. The guidelines that we're providing would give judges serious remedies to put in place a penalty as severe as 10% of the revenue of the corporation, which, in the case of a company like Loblaws, would be $6 billion. That's what I'm talking about when I talk about remedies.

[Iqwinder Gaheer, Liberal, Mississauga—Malton, ON]

Great. Thank you, Chair, and thank you to Mr. Singh for appearing before the committee.

I want to cover the overlap between what the government has presented and this bill. Obviously, we passed major competition reforms with Bill C-56. It empowers regulators to hold the companies accountable, and it does stand up for Canadians. We gave more power to the Competition Bureau to conduct more effective investigations. We made it easier to block mergers that are not in the best interest of Canadians and took action against collaborators that stifle competition and reduce consumer choice.

If there were something lacking in Bill C-56, I think that was largely covered by Bill C-59, whose amendments have resulted in a more modern and effective competition law. Among other things, they help prevent harmful mergers and anti-competitive collaborations, and they hold the large firms accountable.

I want to talk about your testimony in response to Mr. Badawey's questioning. You talked about how, perhaps, what your bill brings is more of a focus on price-fixing and on penalties, but then I look at Bill C-19, which is from 2022 and says:

Division 15 of Part 5 amends the Competition Act to enhance the Commissioner of Competition's investigative powers, criminalize wage fixing and related agreements, increase maximum fines and administrative monetary penalties, clarify that incomplete price disclosure is a false or misleading representation, expand the definition of anti-competitive conduct, allow private access to the Competition Tribunal to remedy an abuse of dominance and improve the effectiveness of the merger notification requirements and other provisions.

When I look at all these bills in combination, it largely seems that what Bill C-352 is proposing is already covered.

What are your comments on that?

[Jean-Denis Garon, Bloc, Mirabel, QC]

I understand the need to reduce the threshold to 30% from 35% and do a study. On the 60% threshold, I think this is an aspect of the legislation that will probably never have any teeth.

I have one last question for you, Mr. Singh. My time is running out—you know what it is like not to be part of the official opposition.

I would like to talk about Glentel. As you know, Bell and Rogers have formed a joint venture, and it is soon going to have a monopoly on the sale of cellphone plans in Loblaws grocery stores. Your bill tackles market structure, but it seems to me that even after Bills C‑56 and C‑59, there are still behaviours that seem anti-competitive but are still allowed.

What is your opinion about this business model? What do you think about the idea of two competitors forming a joint venture and holding the monopoly in a big grocery chain?

Do you think these are anti-competitive practices? Do you think we should go even further than what Bills C-56 and C-59 have already done?

[Vance Badawey, Liberal, Niagara Centre, ON]

Thank you, Mr. Singh.

Again, I mentioned what Bill C-56 and Bill C-59 contained. You mentioned those two points. Are there any other missing elements in those two bills?

[Vance Badawey, Liberal, Niagara Centre, ON]

Thank you, Mr. Chair.

Thank you, Mr. Singh, for being here today.

I'm not going to attempt to put the focus on the politics of the life that we live here in Ottawa, nor the parties that we represent. I want to put the focus on people and fairness.

When the government introduced Bill C-56 and Bill C-59, that's in fact what we did: We put the emphasis on people and on fairness with respect to competition reform. To some extent I think that's what you're trying to do here, too, and I appreciate that.

With that said, through those bills we have established strengthened market studies and the power to compel. We've clamped down on anti-competitive behaviour and cross-industry collaboration. We've removed the efficiencies defence, strengthened the right to repair, strengthened anti-greenwashing provisions, strengthened merger review and cracked down on unfair pricing practices—including drip pricing—as well as strengthening monetary penalties.

I've read your PMB, and I appreciate the intent, but also appreciate what we've accomplished through Bill C-56 and Bill C-59.

What I really want to do is get a bit more granular, Mr. Singh, and drill down on the business part of it, not the politics of it.

You mentioned some of the missing elements of those bills. Correct me if I'm wrong, but you said they were missing strengthened penalties. Therefore, my first question is: What more strengthened penalties do you want to have, over and above what are identified in both of those bills? My second question is whether certain mergers should be banned if they reach a certain level.

Can we get a bit more granular on that? Quite frankly, my intent is to take something away from this discussion and accomplish what you, we, the committee—I would only assume all of us—want to accomplish with respect to being fair, and again, attaching it to the people whom we represent.