Finance Committee on Nov. 20th, 2023

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

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Williams.

Now we'll have MP Weiler, please.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you, Mr. Chair.

I want to thank all our witnesses for being here today and for the great testimony we've had already, and especially for being here late in the evening.

The first question I would like to ask is for Mr. Bester.

In your opening, you mentioned a couple of amendments that you'd like to see. The first one we just touched on. I was hoping that you could speak a bit more about your second recommendation on looking at past agreements as well.

[Keldon Bester]

Section 90.1 is the part of the act that governs anti-competitive agreements. Both CAMP and the bureau have commented on this in the past couple of years. The way the provision is phrased right now, it can only look at existing agreements. Along with that, it has no formal penalties associated with it. That creates a situation where companies can engage in the agreement right up to the point where they are under investigation by the bureau, stop the agreement so the bureau says, “Okay, good job”, and then re-enter the agreement should the attention come off of the player.

The issue there is a sort of cat-and-mouse element. If we looked at past agreements, it would allow there to be real deterrence for future agreements.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you very much for that.

In your opening, you also mentioned that allowing private parties to launch actions under the Competition Act would be helpful. I believe you would have seen in the fall economic statement that there is provision to broaden the reach of the law to enable more private parties to bring cases before the tribunal and to receive payment if they are successful. I'm hoping that you can comment a bit more on that.

[Keldon Bester]

Certainly.

There are two parts to this. One is the ability for parties to collect damages. Again, I use the term “eyes on the ground”. The bureau has something like 400 people. They're responsible for every market across the economy. The second piece of that is the standard for leave to the tribunal. Bringing that standard down while still maintaining the rigorous tests for valid cases is a great way to decentralize our enforcement and pick up where the bureau can't be in all places at a given time.

We were encouraged to see that in the fall economic statement.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you.

Next I would like to ask the Competition Bureau a couple of questions.

Mr. Williams touched on the change to allow the compelling of information during market studies, and you mentioned that this was an impediment in the grocery study you did. I'm hoping that you can speak a bit more broadly on how often you're seeing this issue in your upcoming studies and how that's been an impediment to delivering the best possible analysis and recommendations to government.

[Matthew Boswell]

I can't give you statistics on previous studies, but in this situation, we're always reliant on voluntary co-operation. If we get to the edges of sensitive stuff, if I can use that technical term, then voluntary co-operation will often cease, or we'll get less information than we probably think there is.

It is an issue, and it was obviously an issue in our grocery market study.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

If this legislation is passed and a new ability to compel information is made available, do you see the bureau looking back at previous studies that were done and reopening them to make sure there aren't aspects that were left not discovered? Would it be in the public interest to look into those further?

[Matthew Boswell]

We often discuss—particularly Mr. Durocher's team, which leads these studies—what study we should do next and what area we should look into. Where do we see potential competition issues that matter to Canadians? That's one of the driving forces behind what we decide to do.

Going forward, if Bill C-56 is to become law and these changes come about, at that point we'll have to assess the landscape and the options available to us in terms of market studies. We'll make decisions at that time.

We don't have any plans right now to revisit anything, but it's very fluid. We'll see what happens if the bill is passed.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you very much, Commissioner.

With my remaining time, I'd like to ask Mr. Ross a couple of questions.

As you saw less than a week ago in the fall economic statement, there was mention of how the rebate on GST will be made available to co-operative housing. I know some experts mentioned that the measure we brought forward will ensure that 200,000 to 300,000 more rental units are built in Canada.

I'm curious about whether you'd be able to comment on that. I know this announcement was made quite recently, but what type of difference...? Could you put a ballpark figure on the number of new co-operative rental housing units this might help incentivize?

[Timothy Ross]

I won't be able to offer you a unit count. What I will say is that the rebate will make the difference in the economic viability of “go” or “no go” for many co-op projects today, tomorrow and into the future.

There's another aspect to this. The rebate, because of the co-operative model, passes affordability on right to the end-user—to the member who lives there and the future members who will live there too.

It's for those two reasons that we are very much welcoming this addition through the legislation.

[Patrick Weiler, Liberal, West Vancouver—Sunshine Coast—Sea to Sky Country, BC]

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Weiler.

Now it's over to MP Ste-Marie.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Thank you, Mr. Chair.

Good evening to all the witnesses, whom I thank for their presentations and for being with us to answer our questions.

My first question is for the representatives of the Competition Bureau.

As Ms. Levac said, Bill C-56 repeals the efficiencies defence in anti-competitive agreements. My question relates to this change and the other measures set out in Bill C‑56.

You analyzed the potential acquisition of HSBC Canada by the Royal Bank. Do you think that if Bill C‑56 were enacted, the conclusions of your study might be different?

[Matthew Boswell]

I thank the member for his question.

The removal of the efficiencies defence from the Competition Act, as I think was said earlier by several other witnesses, is forward-looking and wouldn't apply to mergers that were previously notified to the bureau. We examined RBC-HSBC in the context of the Minister of Finance's public interest review of that merger. What's important to point out is that we concluded it would not result in a substantial lessening of competition. Efficiencies did not play a role in our conclusion in that case.

Even if there were some retroactive application of the repeal of the efficiencies defence, it wouldn't impact our assessment of the RBC-HSBC merger. We found there was no substantial lessening or prevention of competition as a result. We wouldn't be able to go back in any event. Even if we could, we wouldn't.

I hope that answers your question.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Yes, your answer was very clear. Thank you very much.

My next question is for Ms. Levac.

Ms. Levac, thank you for being here and for your presentation.

You are asking for the Competition Bureau to have the power to undertake inquiries into the state of competition on its own. If I understood your remarks correctly, under the current provisions of Bill C-56, when the Competition Bureau conducts an inquiry, it does not have all the tools it needs to demand all of the evidence or compel people to testify. That is also my interpretation of the bill. However, Mr. Champagne seemed to be saying, earlier, that everything was provided in the bill and there was no problem. As we know, however, the Minister sometimes takes a very cheery view of things.

I would like to hear your comments on what I am asking you. Do you think this is already in Bill C‑56 or should it be added?

[Sara Eve Levac]

In fact, Bill C-56 provides that the Competition Bureau may ask a court to make an order to obtain information. In other words, it does not have the autonomous power to compel a witness to give testimony or provide information. We believe that this could cause delays in a market study inquiry, when Bill C‑56 provides for a maximum of 18 months for that type of study.

I would also like to point to what happens elsewhere, outside Canada. For example, the European Commission, which has the power to initiate sectoral inquiries, also has the power to compel witnesses to provide information.

If the Competition Bureau had the ability to compel people to provide information to it, that would enable it to get a more complete picture of the situation when it does a market study and, at the end of the study, to make more useful recommendations.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Yes, the maximum time is 18 months. We know that there are also delays in the justice system. It would probably significantly limit the power to conduct an inquiry into market studies.

You are also asking that the commissioner be able to decide on their own initiative to conduct an inquiry, without having to wait for the minister to request it. Can you explain that again?

[Sara Eve Levac]

We believe that as an independent body that has the power to oversee the state of competition, the Competition Bureau must have a comprehensive view and should be able to initiate an inquiry or market study autonomously, if it believes there is a competition problem in a sector.

I would reiterate that there are independent bodies on the international scene such as the European Commission, or the Federal Trade Commission in the United States, that have the power to undertake inquiries themselves. Incorporating that power into the act would allow for greater predictability and clarity. It would also enable the Bureau to obtain information.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Thank you.

I am now going to ask Mr. Boswell from the Competition Bureau to answer these questions.

You also would suggest that the Bureau have the power to undertake these kinds of inquiries on its own. Under Bill C-56, the Bureau will instead have to obtain a court order to compel witnesses to produce documents or appear.

Do you agree with that too?

[Matthew Boswell]

As it stands now in Bill C-56, the commissioner wouldn't be able to initiate a market study inquiry to allow us to go to court to compel records and testimony from participants in the market study. The minister would have the power to commence that inquiry in discussion with the bureau, and we'd create terms of reference paraphrasing how Bill C-56 is set out. We believe that the commissioner should have the ability to initiate a market study inquiry, which gives us the right to go to court and make an application for records and information.

That's not exactly how it's worded now. I understand that in motion 30, there is some potential change to the market study provision, but I'm not clear on what the details are there.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

That is what happens when there are super gag orders: we are working blind.

Thank you for your answers.

[The Chair, Liberal, Peter Fonseca]

Thank you.

Now we'll hear from MP Blaikie, please.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Thank you, Mr. Chair.

Thank you to the witnesses for appearing here tonight.

I want to start briefly with Mr. Ross.

Recently in the House of Commons, the Conservative leader Pierre Poilievre characterized co-ops and social housing as a “Soviet-style takeover of housing” in Canada. Do you think that's a fair or accurate portrayal of what the co-operative housing movement is in Canada?