Industry and Technology Committee on Sept. 17th, 2025

[Raquel Dancho, Conservative, Kildonan—St. Paul, MB]

Thank you, Mr. Chair.

Thank you to the commissioner and to senior staff from the commissioner's office for being here. On behalf of the people I represent in Kildonan—St. Paul, thank you for the hard work you're doing on behalf of Canadians. It's very important work.

Commissioner, I'd like to follow up on an area of discussion that you had with the Conservatives almost a year ago now concerning the issue of Interac. As you know, most Canadians use Interac every day; it's quite ubiquitous in Canada. As we know, Interac is not a neutral public utility; it's a private company dominated by Canada's largest banks, which profit from the system and help set its rules. From what I understand, until recently that meant that the banks that own Interac paid much lower fees for e-transfers, while smaller companies like credit unions, smaller banks and fintechs paid far more for the same services. Of course, you can understand that this would tilt the playing field in favour of the big banks.

The Conservatives raised the alarm on a number of these issues. In October 2024, my colleagues Michelle Rempel Garner and Adam Chambers wrote to you, outlining our concerns that Interac's tiered fee structure and governance created an unfair advantage for the big banks while keeping fees for consumers artificially high.

At our last meeting with you, you confirmed that your bureau had “launched a preliminary investigation” into these concerns. Then, on July 10, your bureau announced that Interac would end those “volume-based discounts” and move to flat-fee pricing, which I think could be seen as a big win. I appreciate the hard work from Conservatives, your work in response to that, and now Interac's move. However, I do have a few questions to see where the fairness is and perhaps what this past conduct means for Interac.

Now, in your response letter to Mr. Chambers and Ms. Rempel Garner, you explained, “Interac announced on June 4, 2025 that it is moving to a flat-fee pricing model starting November 1, 2025. I'm encouraged by this move because I believe it will help level the playing field for financial institutions of all sizes and create a more competitive sector.”

Commissioner, would it be fair to say, then, that Interac and the banks that govern it were engaging in uncompetitive practices prior to this fee change?

[Matthew Boswell]

I don't think I can say definitively, or conclude definitively, that this was the case. We were investigating their conduct and, as said in the letter to your colleagues, we appreciated their flagging the issue. We had a very good discussion about the issue here at committee. We were already investigating before the committee hearing, and we continued. Then, when they announced that they were going to change the practice in question.... The volume-based tiered pricing of wholesale Interac was the main concern we were looking at, and when they indicated that they were going to change to a flat-fee system that didn't have what appeared like a disparity of fairness for smaller institutions to be able to compete, we made the decision that we weren't going to continue the investigation and that we would monitor their commitment to change to a flat fee.

I understand that some people may not understand how law enforcement sometimes has to prioritize investigations, but that's what we have to do at the bureau all the time. We have to make decisions about which investigations to prioritize. In this situation, we felt that what they were moving towards addressed the key part of the problem, and we were going to monitor their implementation of that. That's where we're at. I can't say, though, that we definitively concluded that there was anti-competitive conduct.

[Raquel Dancho, Conservative, Kildonan—St. Paul, MB]

Thank you, Commissioner, for that response.

I just want to understand what you're saying, though. Are you saying that, had Interac not moved to a different fee structure, a further law enforcement investigation would have been conducted?

[Matthew Boswell]

It's always tricky to speculate on these things. What I can say very definitively is that we had an investigation going, and when there was a material change in circumstances, we assessed the investigation and decided that we would put it on hold, for lack of a better term, while we monitored the commitment.

[Raquel Dancho, Conservative, Kildonan—St. Paul, MB]

Okay. If I may just clarify.... I believe the Competition Act prohibits what's called an abuse of dominance, which, as you know, is when a company that already controls most of the market uses its power to tilt the rules against a smaller competitor. That seems to apply in this situation with Interac. Do you see that kind of conduct as potentially falling under the abuse of dominance, depending on the evidence?

[Matthew Boswell]

It certainly was the nature of the investigation and the nature of the discussion about Interac's market power in Canada and the conduct we were looking at, which was the volume-based tiered pricing that effectively benefited the big banks, which were the primary owners of Interac itself.

[Raquel Dancho, Conservative, Kildonan—St. Paul, MB]

Thank you, Commissioner.

Had your investigation continued and had it been found that there was an abuse of dominance.... Just so I'm clear, the potential penalties can range from $25 million to $35 million and can apply to cover the full period of that conduct. That is based on your comments at the last committee meeting when you were here in November. Is that correct?

[Matthew Boswell]

Yes. There are various remedies that we could seek in an abuse of dominance hearing, including the ones you mentioned, but only after a trial, if there wasn't a resolution in advance of a trial.

[Raquel Dancho, Conservative, Kildonan—St. Paul, MB]

Thank you very much.

[The Chair, Liberal, Ben Carr]

Thanks very much, Ms. Dancho.

Mr. Bains, the floor is yours for six minutes.

[Parm Bains, Liberal, Richmond East—Steveston, BC]

Thank you, Mr. Chair.

Thank you, Commissioner, Deputy Commissioner and your team, Mr. Durocher, for joining us today.

I'm going to stay on the same theme as my colleague across the way, on the banking issue. I met with Canadian bankers today. A big issue is fraud and fraud prevention. In 2024, Canadians were scammed out of $638 million in total. We know these funds get injected into criminal enterprises. Canadians are being approached through different platforms, such as digital, over the phone, WhatsApp and different applications.

Can you inform the committee about whether you've done any work on this? Have you looked at this and worked with the banks in any way to help people not be scammed?

[Matthew Boswell]

As I said in the opening comments, we pursue deceptive marketing and mass marketing fraud under the Competition Act. We've had criminal prosecutions for mass marketing fraud in the last several years that resulted in significant penalties, including jail for an individual named Terry Croteau.

We are also one of the three key partners in the Canadian Anti-Fraud Centre, located in North Bay, which does incredible work on a very small budget. If anyone is looking to provide it with additional funds, that would be great. The RCMP, the Competition Bureau and the Ontario Provincial Police run the Canadian Anti-Fraud Centre, which is primarily a call centre, taking in and gathering data on fraudulent scams and the scam of the moment, and trying to disrupt those scams.

The bureau also has a unit that is dedicated to disrupting mass marketing fraud—I won't get into all the details of how we do it—by using tools at our disposal and contacts that we have to try to disrupt frauds and scams that are getting under way.

What's interesting is that, unfortunately, the number you've probably heard is not even close to the actual number of dollars that Canadians are defrauded of every year. Of course, with the digital economy, it's becoming a bigger and bigger problem to police that type of behaviour, because it can originate anywhere and end up in a living room in Kelowna or Saskatoon, and be perpetrated by people on the other side of the world who are very difficult to track down. This is becoming a bigger and bigger problem that we have to pay more and more attention to.

I hope that provides you with an overview of the work we do in this area. We investigate and refer criminal cases to the Public Prosecution Service of Canada for this type of mass marketing fraud.

[Parm Bains, Liberal, Richmond East—Steveston, BC]

Thank you for that.

You talked a lot about previous investigations and the results of those. Can you share active investigations that are going on and that you're pursuing right now, and other challenges you're facing?

[Matthew Boswell]

I can't share active investigations, for a variety of reasons, including letting people who are being investigated know that we're investigating them, which is never a good idea in law enforcement. I can tell you that we do have active investigations. We have a dedicated team that looks at this particular aspect of deceptive marketing.

I don't have them with me, but I'm happy to share after the meeting some examples of recent convictions and recent action we've taken in the mass marketing fraud and deceptive marketing criminal cases. I'm happy to share them with the committee.

[Parm Bains, Liberal, Richmond East—Steveston, BC]

Thank you for that.

My next question is about Bill C-59. In what ways has Bill C-59 equipped you with necessary tools to carry out your work more effectively?

[Matthew Boswell]

That's a very big question. There are a lot of things in Bill C-59. Let me turn to my notes. This answer could take most of the rest of our time.

[Parm Bains, Liberal, Richmond East—Steveston, BC]

Well, maybe I can go to the ways in which the change allowing expanded private access to the Competition Tribunal for Canadians has been effective, maybe that area.

[The Chair, Liberal, Ben Carr]

Mr. Boswell, I'll assist you by telling you that you have about 90 seconds.

[Matthew Boswell]

Okay.

Yes, absolutely. We are the public enforcer. That's a very important role, and we're it for Canada. Bill C-59 and earlier amendments really expanded private enforcement in Canada, allowing for private lawsuits to be brought under deceptive marketing and under civil agreements between competitors. It also eases the test for private parties to get in front of the court. That is very positive, because we have finite resources. We have a mountain of complaints every year, as you know. There are way more cases than we can take.

If there's more ability for private enforcement—we're watching how it develops now, because it just came online in June—that is a great development for competition law enforcement in Canada.

[The Chair, Liberal, Ben Carr]

Thanks very much, Mr. Bains.

Mr. Ste‑Marie, you have the floor for six minutes.

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

Thank you, Mr. Chair.

Good afternoon, Mr. Boswell, Ms. Pratt and Mr. Durocher. Thank you for your work and for being here. You quickly responded to our invitation to join us today.

My first questions will focus on Mr. Bains' comments regarding the bill passed during the previous Parliament and the practical implications for you. The original bill was Bill C‑56. I believe that it was included in Bill C‑59, the budget implementation bill. It contained a number of changes that the Bloc Québécois had been requesting for decades.

How does this change your work in practical terms? For example, Mr. Boswell, you spoke about an initial change that makes it possible to compel a person to testify or provide records. Is this currently a useful tool for your bureau?

[Matthew Boswell]

Thank you, Mr. Chair.

Thank you for your question.

I'll respond in English, because I didn't hear the whole thing.

Bill C-59, as I've just said to honourable member Bains, was really quite a sea change in competition law in Canada. There were many significant developments, developments that for a long time we at the bureau had been calling for and that other people had been calling for.

Obviously, there were some changes that really captured the public's attention, but I would say that probably the most significant area in Bill C-59 would be the changes to the merger regime in Canada. It really took us from what my predecessor and other former commissioners have said was the weakest merger law among all our peer countries in the world, to being actually quite a strong merger law now that can really protect competition in Canada. Merger review is the first line of defence to prevent even more concentration in a very concentrated economy.

I hope that helps.

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

Yes. Thank you.

This component was included in Bill C‑59. Under the previous regime, a provision stated that a transaction had to be authorized if it led to an efficiency gain. I understand that the removal of this provision significantly affects your bureau's current work.

I would now like to get back to my first question. As part of your investigations, you can now compel witnesses to co‑operate or provide records.

Has this been useful to you?

[Matthew Boswell]

Thank you, Mr. Chair.

Again, I apologize. I'll respond in English, if that's okay.

This was a very important change as well, giving us the power, when we're conducting what we call market studies, to look at competition in a whole sector of the economy and see what the competition issues are in that sector. Before these changes in Bill C-56 in 2023, we couldn't compel companies we were looking at in the market study to provide us with records. In the past, we had trouble getting fulsome co-operation from companies. Now, since Bill C-56, we have those powers to compel records during market studies. We've already used them in our study into competition in passenger air travel in Canada. We've used those section 11 powers. They've allowed us to get at more information and data about competition in the sector.

That is another of the many important changes to the law in the last three years.

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

Thank you.

I'm delighted to hear your remarks on this topic.

Another component has changed with regard to Bill C‑56. It concerns anti‑competitive practices prohibited by the act. Now more practices can be viewed as indirect, such as entering into an agreement with a non‑competitor in order to reduce competition. You're now able to use this other game‑changing tool.

Is that right?