Mr. Speaker, I too am pleased to take this opportunity to speak to Bill C-248, which is an act to amend the Competition Act. First I would like to join with the rest of my colleagues in thanking the hon. member for Pickering--Ajax--Uxbridge for his efforts on behalf of Canadians to ensure that the Competition Act achieves its objectives. We must remember that our colleague has been a tireless advocate on behalf of consumers and has served as a watchdog for our caucus, watching for a dominant position to happen or watching for where gouging was likely to happen.
As mentioned by the hon. member for Peterborough, one thing my colleague from Pickering--Ajax--Uxbridge worked very hard on was the issue of gas prices. When gas prices were increasing he took a task force across the province before the province ever got involved. Our caucus truly owes our colleague a great debt of gratitude. My thanks are nothing compared to the thanks the member got from the Minister of Finance in the last budget. At that time, the government looked at how best to assist consumers with rising gas prices when the world price hit record highs. It was felt that something had to be done about the oil companies. In fact, it was through consultations and the work done by our colleague from Pickering--Ajax--Uxbridge that the government looked at giving the rebate to consumers, to ensure that money went back to the consumers and was not hidden somewhere by the government or gouged by the oil companies. I would again like to thank our colleague very much for his efforts.
At issue today is Bill C-248. The bill would specifically amend section 96 of the Competition Act which addresses an issue known as the efficiency defence. This defence comes into play when mergers occur. This defence was not previously applied in practice until Superior Propane proposed to acquire ICG Propane in 1998. Prior to that date, the interpretation of that section of the act was untested. Now, with the bill before us, it turns out that the interpretation is very contentious indeed.
Bill C-248 is an attempt to clarify and impose limitations on the efficiency defence by adding two new subsections to section 96. The new subsection (4) states that:
--gains in efficiency cannot offset the effects of a lessening or prevention of competition unless the majority of the benefits derived or to be derived from such gains in efficiency are being or are likely to be passed on to customers within a reasonable time in the form of lower prices.
The second amendment which is being proposed by the bill is a new subsection (5), which would make the defence of inefficiency unavailable and inapplicable if it resulted “in the creation or the strengthening of a dominant market position”.
When there is a concern about lower prices, benefits being passed on to consumers and when I hear the words dominant position, I again have to thank our colleague for teaching our caucus and members of the House that those are the terms and things we should be looking for.
Before I discuss what I feel we should or should not be doing at this point, I think it is important to return to what happened in the Superior Propane case and what has transpired since Superior Propane proposed to acquire ICG in 1998. It was always the position of Superior Propane that efficiency gains would offset any anti-competitive effects and would justify permitting the transaction to proceed. Unfortunately for Superior Propane, the commissioner of competition disagreed with Superior Propane's view of efficiencies and filed an application with the Competition Tribunal challenging the transaction. What transpired then was that the tribunal agreed with the commissioner that the transaction had significant anti-competitive effects.
However, it accepted the argument of Superior regarding the efficiency defence and ruled that efficiencies would outweigh the anti-competitive effectives of the transaction.
That was not the end of it. The commissioner then appealed the tribunal's ruling on efficiencies to the Federal Court of Appeal which sided with the commissioner and instructed the tribunal to redetermine the propane case. That is still not the end.
Superior Propane then sought leave to appeal to the Supreme Court of Canada. The supreme court refused to hear the matter and, in fact, upheld the ruling of Federal Court of Appeal.
The Competition Tribunal recommenced hearings on the Superior Propane-ICG Propane merger on October 9, 2001. It was required to do this because it had been so ordered. We are anticipating that a decision will be made very shortly. We hope such a decision will appear in January.
I would recommend at this particular time, and I stress the words to my hon. colleague, at this particular time and only at this time, it would be unseemly to amend the law while the matter is being reconsidered by the tribunal with the benefit of these court rulings. Perhaps there will be things in that tribunal ruling which may take my colleague's position or there may be things in that ruling which may assist my colleague enhancing the amendments to the act.
We should also remember the federal court's reasons for judgment gave direction to the tribunal in the form of parameters, but not explicit direction.
At this time I would ask colleagues on both sides of the House to perhaps await a decision. I also encourage my hon. colleague to continue his great work on behalf of all consumers in Canada.