Madam Speaker, I rise today to speak to Bill C-452.
The bill would give Canada's Commissioner of Competition the power to launch broad based studies of market conditions in entire industry sectors¸
Competition in our economy is of enormous importance to both consumers and their employers. The Government of Canada has recognized that fact by taking significant steps over the past two years to modernize Canada's competition regime and to align it more closely with the competition laws of our country's major trading partners.
It is important to ensure that consumers and legitimate businesses do not fall prey to illegal activity and that if they do they have the confidence that the law will be enforced effectively and that penalties are tough enough to deter future illegal activity.
Important amendments to the Competition Act became law on March 13, 2009. The amendments will help to further increase the predictability, efficiency and effectiveness of the enforcement and administration of the act for businesses and for the Competition Bureau. In turn, this will better protect all Canadians from the harm caused by anti-competitive conduct.
These amendments came about through key recommendations made by the Competition Policy Review Panel which was formed in July 2007 with a mandate to review Canada's competition and foreign investment policies and to provide recommendations to the federal government on how to make Canada more globally competitive.
The panel spent a year reviewing Canada's competition and investment policies. Its report, “Compete to Win”, concluded that in order to prosper, Canada must adopt a more globally competitive mindset. The report concluded that intensifying competition will build a stronger economy, better products at lower prices, more jobs and higher earnings, stronger firms and greater prosperity.
The recommendations made by the panel formed a key part of Canada's economic action plan and provided the basis for the amendments to the Competition Act that were introduced in budget 2009 and passed as part of Bill C-10.
The main elements of the amendments were as follows: creating a more effective mechanism for the criminal prosecution of the most egregious forms of cartel agreements between or among competitors and introducing a non-criminal review process for other forms of competitor collaborations; allowing the Competition Tribunal to award administrative monetary penalties against companies that have abused a dominant position in the marketplace; introducing a two-stage merger review process to allow for a more efficient and effective review of proposed merger transactions; increasing penalties for deceptive marketing practices; expressly empowering the courts to award restitution to victims of false or misleading representations; and finally, repealing criminal sanctions for certain pricing practices to ensure that creative pro-competitive initiatives are encouraged.
These amendments ensure that we have the tools to better protect consumers and businesses from the most flagrant types of anti-competitive conduct, while being ever mindful of the importance of not discouraging pro-competitive behaviour in the market.
I raise the government's actions in this regard because of their importance with regard to the issue we are considering today. As I have described, as part of the amendments resulting from the passage of Bill C-10, new criminal cartel and civil agreements provisions came into force on March 12, 2010. These provisions were delayed for one year to give companies an opportunity to verify that their existing or proposed agreements and arrangements did not violate the new civil and criminal provisions. During this time, companies were able to apply to the bureau at no cost for an advisory opinion as to how the bureau would view a pre-existing agreement under the new provisions.
Under the previous cartel provisions of the act, it was extremely difficult to secure a conviction. The Crown needed to prove that an anti-competitive agreement resulted in substantial harm to competition and to prove that element to the criminal standard of beyond a reason doubt.
These hurdles faced by the bureau were out of step with our major trading partners and harmed Canada's international credibility. The provision had not changed significantly in almost 120 years. The Competition Policy Review Panel recommended that this outdated law be changed and this government acted.
We introduced a two-track approach to address agreements among competitors so that the bureau can crack down on harmful conspiracies and pro-competitive agreements and joint ventures can proceed expeditiously.
Price-fixing is a criminal activity that deprives Canadians of the benefits of a competitive market, such as lower prices and choice. The new cartel provision will provide the commissioner with even stronger tools to challenge this type of anti-competitive practice.
At the same time, a new civil provision has been introduced that allows firms to combine capabilities and resources in order to lower their costs of production, enhance product quality and reduce the time required to bring new products to market, all without any fear of a criminal investigation, and this is as it should be, of course.
These collaborations may be reviewed civilly where they are likely to lead to a substantial lessening or prevention of competition. In such circumstances, the Competition Tribunal may prohibit collaboration, but that is all it can do.
Bill C-452 proposes to amend the Competition Act to authorize the Commissioner of Competition to inquire into an entire industry sector. The commissioner currently has considerable powers in her enforcement role to investigate the state of competition in the marketplace and these powers are appropriately tied to whether the Competition Act is being violated. Importantly, the commissioner investigates the behaviour of businesses and individuals where there is evidence that they may have broken Canada's competition laws.
It is clear that the issues the House must consider when debating this bill are far-reaching and very complex. I want to take this opportunity to thank the hon. member for his efforts to date and the introduction of this bill. I understand that he has noble intentions regarding this matter. However, I wish to remind him of the public and private costs associated with assigning new powers to the commissioner.
We must also recognize the very significant new powers that this government has recently provided the commissioner in order to investigate and deter the types of activities that lie at the heart of this bill. These tools are targeted directly at the types of practices that lie at the heart of the hon. member's concerns and, therefore, will be far more effective than those proposed in the current bill.
The Competition Policy Review Panel argues forcefully that it is vigorous competition that spurs a cycle of innovation, boosts efficiency and adaptability, and raises productivity. The recent changes to the Competition Act are evidence that this government will continue to take the right steps to strengthen Canada's economy and create sustainable employment. It is against this backdrop that the proposal outlined in Bill C-452 should be thoroughly reviewed.