Industry Committee on Dec. 3rd, 2020

[James Cumming, Conservative, Edmonton Centre, AB]

I'm a bit taken aback by that; I'm surprised by it. Shouldn't your department be thoroughly involved in a bill of this nature?

[Matthew Boswell]

All I can say is that we weren't asked to provide input.

[The Chair, Liberal, Sherry Romanado]

Thank you very much.

Our next round of questions goes to MP Jaczek.

You have the floor for five minutes.

[Helena Jaczek, Liberal, Markham—Stouffville, ON]

Thank you very much, Madam Chair.

Thank you to the witnesses for coming today.

You of course have heard from my colleagues a number of our frustrations in relation to competition in Canada, whether it be the large grocery chains or the large purveyors of telecommunication systems. Certainly this committee has heard what I think a lot of us may feel—certainly I do—that somehow, competition isn't working very well.

I'm very pleased to hear that since May 2019 you've been working on some suggestions for Minister Bains to potentially amend the legislation. You've given us a few hints of some areas where you may be going with that—codes of conduct, a convergence with our largest trading partner, the United States, etc.

I'm interested in the enforcement side. If you feel there's a civil case, you go to the Competition Tribunal. If potentially criminal charges might be laid, you go through the director of public prosecutions. Do you see any changes there that could be helpful for your work and that you may be looking at for the future as well?

[Matthew Boswell]

Our ability to bring cases to either the Competition Tribunal or the criminal courts via the Public Prosecution Service of Canada is obviously fundamental. We have a prosecutorial model.

We've talked a bit today on the civil side about the ability to have financial sanctions that are scaled to the size of the enterprise that we're dealing with. This is something I perhaps should have brought up in response to Mr. Cumming's question, in the sense that another positive development, from our perspective, of Bill C-11, the privacy bill, is that the financial penalties in that bill are scalable. That is, they can be based on a percentage of global revenue. Many of our partners around the world have those types of financial penalty provisions in their acts. In my view, it's important, in order to encourage compliance with the law, to have sanctions that reflect the volume of commerce involved and the revenues at play.

[Helena Jaczek, Liberal, Markham—Stouffville, ON]

Thank you.

That's very useful. I think it ties in quite well with what my colleague MP Masse was saying in terms of our being, in essence, such a small player in terms of the potential volume of activity locally. These are huge corporations that obviously would respond to potentially more onerous sanctions.

Am I understanding you correctly that you would see sanctions and fines potentially matching the scale of the operation of the particular company?

[Matthew Boswell]

It's something that's certainly worth considering in a comprehensive review of the act.

I should point out that there are areas of the act where there are no financial penalties available at all. For example, in relation to civil agreements between competitors in section 90.1 of the act, which is the alternative section to examine wage fixing, there is no ability for a financial penalty in that section whatsoever.

[Helena Jaczek, Liberal, Markham—Stouffville, ON]

I think I'm almost out of time.

I will hand it over to my next colleague.

[The Chair, Liberal, Sherry Romanado]

Thank you very much.

We'll now start the third round.

Our first round of questions goes to MP Jeneroux.

You have five minutes.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

Thank you, Madam Chair.

It's a pleasure to be here with everybody.

Mr. Boswell, thanks for joining us.

I'm looking at your budget. Your budget in 2009 was $40 million, and your budget in 2020 is $37 million. Your employees essentially have stayed the same, but you're down one employee. Unless that one employee was making $3 million, I assume that essentially everything has been kept about normal for that period. I suspect the pandemic itself has only accelerated a lot of the requests or need for the Competition Bureau.

Big tech is interesting, but I'm also curious if there are practical examples of things like hand sanitizers or PPE, perhaps, that you can share with us and how this pandemic has accelerated some of those concerns.

[Matthew Boswell]

As I alluded to in my opening remarks, shortly after the declaration of the global pandemic, the bureau took the unprecedented step of issuing guidance to the marketplace in terms of a willingness to exercise enforcement discretion for competitor collaborations that were specifically designed to keep supply chains going so that critical goods and services could get to Canadians. We put that out in early April. We set out that if those agreements or collaborations between partners were time-limited and very much focused on making sure that Canadians got the critical goods and services they needed, then we would exercise enforcement discretion with that. Of course, we also cautioned that we wouldn't tolerate any abuse of that indication to the marketplace.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

Have you seen some abuse?

I guess grocers and big tech aside—

[Matthew Boswell]

Sadly, this didn't come as a surprise to us. In fact, we issued a warning within days of the pandemic starting, in terms of deceptive marketing practices trying to take advantage of the pandemic: false or misleading representations of products saying they would prevent, treat or cure COVID. Within days of the pandemic being declared, we assembled a dedicated team to monitor the marketplace for these types of false or misleading representations.

As they came to our attention, we would send these companies warning letters, rapidly, saying that this conduct was likely offside of the act and that the representations were false or misleading, and calling on them to change their conduct immediately. We did that with dozens of companies, and fortunately the vast majority of them heeded our warnings, took down their representations and had products pulled from shelves. That allowed us to make sure that these, in fact, dangerous false or misleading representations weren't out in the marketplace.

We still have a team dedicated to this, monitoring this and getting complaints. We had a surge in complaints between April and June of this year, two times the number of complaints in terms of deceptive marketing practices. Sadly, as I said, it did not come as a surprise to me. There are always people who are willing to try to step into a crisis and make money off it. In this case it was, in our view, through false or misleading representations.

[Matt Jeneroux, Conservative, Edmonton Riverbend, AB]

I will heed the chair's warning. I'll sneak in a quick question, then.

It seems everywhere you go there are different hand sanitizers. Some are more potent in smell; some you barely smell, that being just one indicator. It seems like every distillery across Canada has come up with a way to shift to making hand sanitizers. How connected are you guys with Health Canada in making sure those hand sanitizers...? Inevitably, they have to get pulled off the shelves, and then they get put back on the shelves once they've met the criteria.

You probably don't have time to answer. I'm trying to be polite. I guess it's something to think about and maybe touch on in another question.

Thanks.

[The Chair, Liberal, Sherry Romanado]

Thank you. Unfortunately, you are out of time, but perhaps Mr. Boswell can answer that in a subsequent round. Those were excellent questions, MP Jeneroux.

Our next round of questions goes to MP Jowhari.

You have the floor for five minutes.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you, Madam Chair.

Thank you to the witnesses. It's quite an informative session.

This question goes to Mr. Boswell. In your recent speech to the Canadian Club Toronto, you argued that to ensure a strong economy and a prosperous future for Canadians after the COVID-19 pandemic, it was necessary to take action “in three vital areas”: fostering competition in digital space dominated by global tech giants; developing a robust telecommunications infrastructure underpinned by competition; and prioritizing competition in regulatory environments at all levels of government.

Can you talk about what action specifically the federal government can take to support this agenda?

[Matthew Boswell]

Yes, I suppose the third pillar is where the federal government and all levels of government can support this agenda, which is to examine existing or proposed regulations—as I said, at all levels, including municipal—to make sure that those regulations—obviously, they may have other policy objectives—are taking competition into consideration and hindering competition as little as possible, while also trying to achieve those other objectives.

In line with that, as we flagged to this committee in a submission in May, we have developed a competition assessment tool kit for use by regulators across the country to bring that competition lens to their regulations. There's extensive evidence out there that Canada could benefit. It could be a great opportunity for Canada to really bring this competition lens to all of our regulations in this country.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you for that.

Given our constitutional framework and the fact that you emphasize all levels of government, how can the federal government encourage other levels—the provinces and municipalities—to prioritize competition in their own regulatory environments?

Could you respond quickly, because I want to squeeze in another question for you?

[Matthew Boswell]

I suppose it's leadership by example and embracing a culture of competition in this country coast to coast to coast.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Okay. Thank you.

The federal government, as you know, recently introduced Bill C-11 for the protection against commercial exploitation of personal information and the establishment of a data protection tribunal. Clause 14 of this bill would notably amend the Competition Act to facilitate co-operation between the Competition Bureau and the Privacy Commissioner.

How does this bill affect your activities, if Parliament enacts it in the near future in its current form?

[Matthew Boswell]

Madam Chair, I'm going to ask my colleague Mr. Durocher to answer the honourable member's question, because I'm going to try, yet again, a new mike so I don't have to hold this up by my mouth for the next hour.

I'll turn it over to Mr. Durocher.

[Anthony Durocher]

Madam Chair, in response to the question, it creates a means to facilitate the sharing of information between the Competition Bureau and the Office of the Privacy Commissioner, which can be particularly important in the context of investigations. It would facilitate information sharing between us to make investigations progress. From our perspective, the ability to share information with like-minded partners is particularly important, and this was certainly something that was welcomed in our preliminary review of the bill.

[Majid Jowhari, Liberal, Richmond Hill, ON]

I have about 30 seconds. I'm going to squeeze this one in. Hopefully you will be able to answer it.

From a competition perspective, what balance should the federal government aim to achieve between protecting individual privacy and fostering innovation in the database market?

Does anyone want to answer in 15 seconds?

[Anthony Durocher]

I'm happy to answer. I wasn't sure if the commissioner was back on.

Obviously, in a data-driven world things like data portability and data mobility are key to empowering consumers with their own data, which in turn can facilitate competition, but we recognize that data is critical to drive innovation as well and to enable companies to improve the quality of their products and their offerings in the marketplace. Certainly from a competition perspective, empowering consumers to switch providers with their data through data portability is a very important notion in a digital world.

[The Chair, Liberal, Sherry Romanado]

Thank you very much.