Mr. Speaker, I am pleased to speak on behalf of the Parliamentary Secretary to the Minister of Industry and address this question about retail gasoline prices raised on May 7 by the hon. member.
We have already answered this question several times before the House. Again, I repeat that our views on this important matter are very straightforward. We believe that a fair, efficient and competitive marketplace will provide Canadian consumers with the best prices and will encourage companies to innovate and offer new product choices.
As we all know, the Competition Bureau is an independent law enforcement agency responsible for the administration of the Competition Act. The act contains criminal provisions that prohibit price fixing and price maintenance, as well as civil provisions dealing with mergers and abuse of dominance in the marketplace. All these provisions apply to gasoline and other petroleum product markets.
We must also acknowledge that there is a larger context to this issue. We must remember that outside factors influenced the price of gasoline in Canadian markets, especially in February 2003 with an impending war in Iraq, a political crisis in Venezuela which affected that country's oil production, a cold winter in northeastern North America and unusually low inventory levels throughout this continent. All these factors created upward pressure on crude oil prices, which in turn had an impact on the price of gasoline in Canada and around the world.
In fact retail gasoline prices around the world reached very high levels in February 2003. However, the latest available data from the International Energy Agency, an autonomous agency linked with the OECD, showed that in June 2003 Canada had lower gasoline prices than most of the other major industrialized countries studied.
It is important to note that high prices and profits during volatile market conditions are not contrary to the Competition Act. Suppliers of any product are generally free in Canada to charge whatever prices the market will bear. Experience has shown that over the long run, market forces are the most reliable means of ensuring that product prices are as low as possible.
Agreements among competitors to artificially fix or raise prices are prohibited under the criminal conspiracy provisions of the act which are strictly enforced at all times.
At this point there is no evidence to suggest that the price increases over the last year are due to any conduct which would raise issues under the Competition Act.
I can assure hon. members that where the Competition Bureau finds that companies or individuals have engaged in anti-competitive conduct, it does not hesitate to take immediate and appropriate action under the Competition Act.
If anyone has any evidence that prices in the petroleum products sector are being set by agreement among competitors and not by market forces, I encourage them to bring that evidence to the Competition Bureau.
In the past the Competition Bureau has been very active in examining markets in the domestic petroleum industry.
In the last 12 years the Competition Bureau has conducted four major investigations of the gasoline industry, as well as numerous examinations of consumer complaints, and has not found any evidence to suggest that the price increases which occurred during that time period resulted from either a national or regional conspiracy among refiners or other suppliers of gasoline. Indeed, we must recognize that the periods of high prices in the past proved to be temporary and were always followed by a return of prices to normal levels.
In the year 2000, in response to concerns about gasoline prices, the federal government sponsored an independent study by the Conference Board of Canada to examine Canadian gasoline and diesel fuel markets. In its report, released in February 2001, the Conference Board concluded that Canadians were well served by gasoline markets that operated fairly and efficiently and that they enjoyed some of the lowest gasoline prices in the world. The report also has noted that the rapid increase in world crude prices was the main factor explaining increases in Canadian gasoline prices.
While I realize that this is little comfort to consumers who have had to pay more to fill their gas tanks, I must remind the hon. members that the Government of Canada does not have the authority to directly regulate retail gasoline prices except in emergency situations and therefore, under the constitution, the decision whether to regulate retail prices rests with the provinces.