Industry Committee on Nov. 25th, 2024

[Anthony Durocher]

The Competition Act has just undergone three sets of major amendments, which have really brought it up to date. In terms of the situations to which you're referring, we're focusing on the implementation of those amendments, which have given us the tools we need to protect and promote competition.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Would you be able to tell me approximately what has already been implemented and what will be implemented next?

[Anthony Durocher]

Bill C‑59received royal assent in June, I believe, and almost all the changes were implemented, save a few provisions that will come into effect one year later. It's similar to Bill C‑56, which obtained royal assent in December 2023 and, if I'm not mistaken, some changes will come into effect one year later, so in December 2024.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Perhaps you want to wait for all these changes to come into effect before recommending improvements.

[Anthony Durocher]

We're constantly thinking of additional changes that could be made to the act. We have some ideas, if you want to talk about them, but, as I mentioned, the changes that were made are quite substantial, and we're focusing on their implementation.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

If I have any time left, I'd ask you how to improve it. Otherwise—

[The Chair, Liberal, Joël Lightbound]

You're out of time, Mr. Savard‑Tremblay, but I'm certain there will be ample opportunity to ask other questions.

Mr. Masse for six minutes.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

Thank you to our witnesses here today.

Actually, Canada had one of the first laws on competition ever enacted in the world. We implemented our first law in 1889, and then the United States, under the Sherman Anti-Trust Act in 1890, came in with theirs. We've been, at least during my time in Parliament, outside the box of where we started as a country, in many respects, with regard to competition and having some involvement. I'm glad to see this happening here, along with the opening of the investigation formally.

I've also written your office today with Alistair MacGregor about frozen potato products, because there's an antitrust suit in the United States that I'm hoping gets some attention, but I'll leave that for the moment.

One of the things you mentioned in the first part of your testimony.... Are we still missing, from the perspective of...? It's almost like a competition advocacy mandate that seems stronger in the United States and other places. Is that maybe one of the unfinished pieces of business with our current situation? I like the changes that we have. There were others that I wanted to see. Is that what you're getting at, with regard to the unfinished business of those who believe in stronger competition laws, enhancement and oversight policy that empower the Competition Bureau to be able to do more and that are more in line with the European Union and the United States? Is that where the hole is, what we're missing? Please identify if I'm right or wrong.

[Matthew Boswell]

I think you've hit exactly on what we've been talking about—and we've been talking about it for a few years now—which is that the bureau's job is to address private restraints on competition that are anti-competitive and that are violations of the Competition Act. We are evidence-based. We unearth the evidence. We decide if there's sufficient evidence and take the cases to court or settle out of court, which we have the ability to do.

However, there's a whole other basket of restraints on competition that I was speaking to in response to MP Chambers' question. Those are public restraints on competition, which are a problem—as I've said and as we've said repeatedly—throughout the economy and all levels of government. We need something akin to what was done in Australia in the 1990s or to the White House Competition Council, which is in place under the current administration in the United States. We need to have a focus on or to require governments to think about competition when they're drafting regulations, when they're amending regulations or when they're putting in place new laws. They need to think about how it's going to impact competition. That needs to be very deliberate, and it needs to be put in place structurally so that people throughout government at all levels are thinking about these issues.

We're not saying that this is malicious, necessarily, but it has clearly developed into a serious problem in Canada, a lack of awareness of how certain policies impact competition and harm the markets in Canada. We're saying that this needs to be done, and it needs to be done in a whole-of-government way because the problems are at all levels.

[Brian Masse, NDP, Windsor West, ON]

I'll simplify that, if I could. It's a more proactive way of dealing with this issue and then ensuring that those who actually want to diversify whatever part of the economy they're interested in will have a better way of advancing their own competitive business models and will not be damaged along the way by trying to break through the current model. Our legislative process would be a little more proactive, as opposed to how it is right now, where we're being very defensive.

[Matthew Boswell]

It's more that the people involved in the decision-making and the drafting would be forced to think about how this is going to impact competition. It's a policy directed at some other issue, but you have to think about how that is going to impact competition in the marketplace and whether there is some way of achieving that other goal without negatively impacting competition—without making it harder for people to start businesses, to enter markets, to create more competition, to bring more small and medium-sized enterprises fighting for the business, and all those issues.

[Brian Masse, NDP, Windsor West, ON]

I'm running out of time, and I know I'll get some more time later, but with regard to our current study, how do you envision...? Can you give us some details?

I've gone through the rewards programs on credit cards. It is a dog's breakfast, and there's the thought that the rewards process.... They like to present it as free, but it actually comes with obligations that might even be corporate secrets among the credit card companies and the businesses that they're doing those rewards programs for. How do you evaluate or estimate that as you try to figure out how truly competitive the credit card industry is?

[Matthew Boswell]

That would involve engaging in a detailed examination of the competition issues at play.

What we're talking about in terms of a preliminary investigation, though, is the Interac fees charged, which was raised at this committee. At this point, we're not proposing to engage, for example, in a very broad market study into the entire payment sector or the entire credit cards, payments and Interac sector. This preliminary investigation is in response to some of the testimony we heard here at this committee.

[The Chair, Liberal, Joël Lightbound]

Thank you very much, Mr. Masse.

I'll now give the floor to Ms. Rempel Garner for five minutes.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Thank you, Chair.

Thank you for your response to our letter.

In your first round of questions with my colleagues, you mentioned that it's a positive thing that parliamentarians are scrutinizing the financial sector for competition in a broader lens. Are there areas, particularly within the scope of this study, related to credit card practices or the financial sector broadly that you think the committee should be considering?

[Matthew Boswell]

I'm not sure I'm in a position to give very good advice on the different areas. One thing I should be clear about is that we don't claim to be experts on the entire payment system. Our focus in our work every single day is competition throughout the Canadian economy. Our act applies to the entire economy.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

You have in the past. Your bureau has looked at Interac and credit cards. This isn't the first time Interac has been looked at. Based on that history, are there certain areas now—because we're not experts either—that we should be drawing our attention to based on feedback the bureau has received from the public?

[Matthew Boswell]

I would say that, based on our previous Interac consent order, which was from 1996 to 2020, one of the issues was putting in what we call behavioural safeguards to protect.... Because Interac was made up of the charter members, which were eight banks and a credit union, there needed to be an independent committee that dealt with some of the pricing issues.

As I alluded to in the opening, I think it would be paying attention to the governance models of these systems, which is not necessarily a bureau thing until anti-competitive conduct results. For example, it's about how the real-time rail will be governed and all those issues.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

Would you be able to table with the committee that compliance order? Is that possible?

From there, because I know the Competition Bureau's mandate on enforcement has changed, were there any enforcement measures that were taken by your agency? I'm guessing there weren't, but are there any with regard to that compliance order that we should be considering?

[Matthew Boswell]

We're happy to provide the compliance order. There are multiple different versions of it.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

It saves me the google, so thank you.

[Matthew Boswell]

It's a lot of reading, though. There are multiple different versions. It's changed over the years.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

We had a debate about how fast I read at the last committee meeting, so we're good. Yes. Giddy-up.

[Matthew Boswell]

As my colleague Ms. McWhinnie pointed out, we also have experience in the credit card space, in the case we brought against Visa and Mastercard for resale price maintenance. That revealed some interesting things. We can provide you with that decision. It's quite lengthy.

[Michelle Rempel, Conservative, Calgary Nose Hill, AB]

With regard to our task of coming up with recommendations, particularly with the issue that we wrote to you about, it is within our purview to ask for information from different sources. Is there information that you think would be helpful to parliamentarians in our deliberation of this particular matter?