Industry Committee on June 17th, 2024

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

I think this is a good clause. We look at the bigger problems we've had. Other witnesses talked about Canada Bread and others where we've had the bread price-fixing, and we've had certain problems there. We have to catch up to other countries. We do agree higher fines and penalties are a deterrence, as well as the law. I think this is a good clause.

[Ryan Turnbull, Liberal, Whitby, ON]

I strongly disagree with my colleagues in that this is imposing a maximum penalty, which removes the court's discretion. We heard from witness testimony very strongly that this would not increase penalties. In fact, it caps penalties and doesn't allow the courts to use their discretion when determining the penalties. The order of fines could be higher without this in place. In fact, I think Bill C-19 addresses this already, so we'll be voting against it.

I wanted to clarify, Chair, that on the previous vote I said “on division”, but apparently you can't vote something down on division. That's my mistake. I shouldn't have made that mistake, because I know better.

[The Vice-Chair, Conservative, Rick Perkins]

The clause was defeated.

[Ryan Turnbull, Liberal, Whitby, ON]

It was defeated. Okay. I wanted to make sure. Thanks.

[The Vice-Chair, Conservative, Rick Perkins]

Go ahead, MP Garon.

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

I wanted to make the same point, Mr. Chair.

Some of the witnesses we heard from, including jurists, credible people with long experience studying Canadian competition law, did point out that although the intention is excellent, clause 3 would interfere with judicial discretion. Moreover, as my colleague Mr. Turnbull said, it could be interpreted by the courts as capping fines.

In this context, we will vote against clause 3.

[The Vice-Chair, Conservative, Rick Perkins]

Are there any other speakers? I see none.

Then we'll go to a vote on clause 3.

(Clause 3 negatived: nays 6; yeas 4)

(On clause 4)

Are there any comments about clause 4?

Go ahead, MP Turnbull.

[Ryan Turnbull, Liberal, Whitby, ON]

Yes, quickly, as we understand, this provision has fallen into disuse. It's not used very often at all. We understand that the commissioner of competition is against adopting the language as is within clause 4, so we'll be voting against it.

[Brian Masse, NDP, Windsor West, ON]

This clause increases a penalty for agreements or arrangements between federal financial institutions to a fine of $25 million to match criminal cartel penalties. For that reason, we support that, because that consistency is necessary to change the behaviour of some of the practices.

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

It's the same arguments as last time. We also agree with the NDP on this that we need some consistency. Even though I hear the argument that the courts may lose discretion, they're not normally using their discretion. They're not having cases come to the courts. This puts this into writing. It is a better deterrent to have that in the bill.

Thank you.

[The Vice-Chair, Conservative, Rick Perkins]

Are there any more comments?

Seeing none, shall clause 4 carry?

(Clause 4 negatived: nays 6; yeas 4)

(On clause 5)

Go ahead, MP Turnbull.

[Ryan Turnbull, Liberal, Whitby, ON]

I'll just make a very quick comment here. This language is adopted verbatim, exactly as is in Bill C-56, so I believe this is clearly redundant. We'll be voting against.

[Brian Masse, NDP, Windsor West, ON]

We agree. We're really glad the Liberals changed their position on this, because the history of this committee had this issue up several times, and we had recommendations. It's with a sigh of relief I see that they're not going to reverse again on this issue.

[The Vice-Chair, Conservative, Rick Perkins]

Are there any other comments?

MP Williams.

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

I just wanted to agree that there's redundancy.

[The Vice-Chair, Conservative, Rick Perkins]

Are there any more comments on clause 5?

It doesn't look like it, so shall clause 5 carry?

(Clause 5 negatived)

(On clause 6)

On clause 6, we have an amendment from the NDP, NDP-1. I'll open up the floor.

MP Masse.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

Specifically, clause 6 increases penalties from 3% of worldwide revenue to 10%. Other aspects of this clause are deleted since the need to prove anti-competitive efforts to find abuse of dominance have already been dealt with through the NDP amendments in Bill C-56. This would align the penalties that we have proposed to deal with conspiracy, and we would hope the committee moves on this. I think it's one of the ones for which we had a lot of testimony that supported this part of adding the competition strength that's necessary.

[The Vice-Chair, Conservative, Rick Perkins]

Thank you, MP Masse.

MP Williams.

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

Yes, we agree with this for the same arguments, just the same voting we've just done in the last two, which is that we need more deterrence. We need to have greater penalties. We have a major problem in Canada by having too much power in the hands of a very few. We need more penalties to ensure there's greater deterrence until we have more competition to take care of that on its own.

[Ryan Turnbull, Liberal, Whitby, ON]

My understanding is that this amendment would increase the backup calculation for a maximum amount of an administrative monetary penalty in the rare situation where the benefit derived from an abuse of conduct cannot be determined. It's really a backup calculation. It's not actually....

Maybe I'll just quickly ask Mr. Chhabra or any of the team if they could quickly comment on how they see this one interacting with the changes that have already been made in Bill C-56 and Bill C-59.

[Samir Chhabra, Director General, Marketplace Framework Policy Branch, Department of Industry]

Sure. Thank you for the question.

There are a couple of issues that we've identified with NDP-1. The first, in our view, is that the amendment fails to repeal the entirety of the redundant provisions that would be created against Bill C-56, which would leave incongruencies and duplication in this section. My understanding is that particularly subsection 79(4) remains unaddressed by NDP-1.

On the second point, you're quite correct that this amendment would only increase the backup calculation. The primary calculation for a maximum amount of an administrative monetary penalty would continue to be driven off the benefit derived by the action. This is simply a backup calculation in the rare instances when it's not possible to calculate the benefit derived by the party.

The current formulation was adopted by the House in 2022. The backup calculation has not yet been invoked at any time, and no issues have yet arisen that would suggest that a change to the law this soon after is necessary.

On two issues, I think there's some consideration for the committee. The first is the lack of complete amendment considerations against the bill vis-à-vis 79(4) being outstanding. The second is whether it's important to move forward with amending this backup calculation, at this time, given the lack of evidence.

[Ryan Turnbull, Liberal, Whitby, ON]

I hear both that there's a lack of evidence to justify this being necessary but also that it doesn't repeal the full section, meaning that it would create some incongruencies. That was the word you used, but I would also say it creates some inconsistencies in the way the bill would be interpreted, so for that reason, we'll be voting against.

Thanks.

[The Vice-Chair, Conservative, Rick Perkins]

Thank you, MP Turnbull.

MP Masse.

[Brian Masse, NDP, Windsor West, ON]

My understanding is that it's still withstanding and 79(4) does not stop this improperly from being administered through the process. I don't quite understand the argument there because the amendments were drafted by legislative counsel and are consistent with passing and that context, so I think that's....

The second thing is that it hasn't been used as a backup. That's the whole point of having a backup: It's there if you need it, so to use it as a reason not to do something defeats the whole purpose of having a backup, because that's what it's there for. We have continued problems with regard to competition in Canada and this gives us one other option to actually state to those operators out there that there is a system in place that will take care of you if you abuse Canadian consumers. That's the point of a backup.

[The Vice-Chair, Conservative, Rick Perkins]

Thank you.

It doesn't appear there are any more comments on NDP-1. There being none, I get a sense that we probably need a recorded vote on this.

(Amendment negatived: nays 6; yeas 4 [See Minutes of Proceedings])

MP Turnbull, please go ahead.