Crossing challenging waters: a time of transition
Remarks by Interim Commissioner of Competition Matthew Boswell
CBA Competition Law Fall Conference
September 27, 2018
(As prepared for delivery)
Thank you, everyone
Today, I’m here for the first time addressing you as Interim Commissioner of the Competition Bureau. And as you can tell from my title, we are in a period of transition at the Bureau.
Transition is a word the English borrowed from Latin (transitio), which means to “go across.”
So, yes, we are at a kind of crossing.
If this were a boat that we’re all in, we’d be halfway across a river. And yes, there are always some currents to navigate, because that’s just how these things go. But we’d be very sure of where we are going on that crossing. And why.
We’ve done this before. This boat has a highly skilled crew who know how to row. Who know how to navigate. And who know how to work well with others.
And the work we do doesn’t change. We continue to keep wrongdoing in check. To ensure the rule of law stands. To speak up and speak out in favour of competition in the marketplace. To advocate for innovation over outdated regulatory practices.
All of that only happens when you have a great team who cares about the kind of economy we want to build: one where markets are competitive.
I should know: I get to work with people like that every day. It’s what brought me to the Bureau in the first place, and it’s why I’m truly honoured to serve as Interim Commissioner. This role is an important one. I don’t take it lightly.
I’m going to spend some time today talking about this journey we are on.
Not slowing down
Every time the Competition Bureau fights the good fight and prevails, Canadian consumers reap the rewards of a marketplace that’s more competitive and innovative.
That’s why the Bureau isn’t slowing down.
Look at one of our biggest successes this year. We took on the Toronto Real Estate Board, or TREB, in a long, drawn out fight. It took years, but we prevailed.
Back in 2011, we sued TREB after we found it was imposing restrictions on its members’ access and use of real estate data. To use one’s dominant position in a market to limit consumers’ access to that kind of valuable information is just wrong. It’s bad for homeowners and home buyers.
That’s why the Bureau took legal action.
That long legal journey came to an end on August 23rd when the Supreme Court of Canada decided not to hear TREB’s appeal. So the Competition Tribunal’s decision stands: TREB’s rules were an abuse of their dominant position in Canada’s largest real estate market.
That’s a win for competition. A win for innovation. And a big win for consumers. The impact won’t be felt just in Toronto. It is also sending a powerful signal to real estate boards across the country to review their own rules, policies and practices to ensure they’re in full compliance with the Competition Act.
Another big achievement is the launch of our updated Immunity and Leniency programs. This just happened today, and I can tell you that it was the product of a lot of work over a long period of time.
These updated programs are recognized and endorsed by the Public Prosecution Service of Canada. In fact, the preface of the revised programs is co-signed by the Director of Public Prosecutions. The programs will provide certainty for your clients. And they remain the best course of action for those who violate the criminal provisions of the Act.
The programs are now structured to encourage your clients to provide evidence earlier in the process. This way, cases will be better prepared for prosecution. At the same time, the programs continue to offer your clients some of the strongest incentives in the world for their cooperation.
Making this happen hinged on consulting…and persevering. The Bureau and the PPSC worked closely with colleagues, including many of you in this room today, along with the U.S. Department of Justice, the antitrust section of the American Bar Association, and the International Bar Association.
We listened to you throughout the process and you can see it reflected in our final programs.
Another achievement we are proud of is the publication of the Bureau’s Market Studies Bulletin. This is an important tool because it provides clarity and predictability on how the Bureau conducts market studies.
We are also incredibly busy with a series of cases before the courts right now. In just a few days, the Competition Tribunal will hear our case against the Vancouver Airport Authority for alleged abuse of dominance related to in-flight catering.
We are also pursuing a case against the Hudson’s Bay Company. We believe they have made false or misleading representations about ordinary selling prices for mattresses. And we are continuing litigation against four individuals involved in an alleged infrastructure cartel in Gatineau.
And our case continues against Ticketmaster for what we consider to be drip pricing. Two weeks ago, we filed a motion to make sure that they provide us with all records that are relevant to the case. Clearly, there is more to come on this front. We are working hard to have the practices alleged in this case addressed before the Tribunal.
As you see, we are not slowing down.
Keeping a steady hand at the helm
To illustrate this, let me give you a few numbers. Our teams are currently advancing more than 41 investigations in the digital economy. So far this year, we have concluded 53 merger reviews, resolved 8 matters out of court, made 8 advocacy interventions and addressed close to 2,500 inquiries from the public.
Each of these activities is propelled by the commitments we made earlier this year in the Bureau’s 2018-2019 Annual Plan.
Every day, Bureau employees strive to deliver on five fundamental principles:
ensuring increased compliance with the law;
collaborating with our partners; and
Let’s look more closely at each of these.
First, increased compliance. We periodically issue public announcements to give businesses the information they need to review and correct their practices. That’s good for their bottom line and their reputation. We think it’s also good for Canadians because changes can be implemented quickly and without the need for long, expensive and uncertain litigation.
For example, just days ago, we issued a warning to the online video streaming industry. We told them that their terms and conditions need to be clear and transparent for consumers. We said that we expect them to follow best practices and comply with the law. We published a clear, concise set of best practices, and we followed up with letters to major players.
This action follows a coordinated sweep we carried out in partnership with the International Consumer Protection Enforcement Network. This initiative was led by the Bureau. As we know, the online marketplace is borderless, so global competition authorities must work closely to combat illegal practices.
Another way we increase compliance is by arming marketing professionals with information about emerging issues. We know that influencer marketing is pervasive online today. So we dedicated much of the fourth volume of the Deceptive Marketing Practices Digest, published in June, to that issue. It is squarely focused on the role and responsibilities of both influencers and the advertisers that hire them.
Empowering Canadians is the second item in our list of principles.
At the Bureau, we operate on the assumption that the vast majority of businesses would rather comply with the law than become involved in enforcement proceedings. That’s why we think that initiatives like those I just mentioned make sense.
But we also need to think of Canadians. We want to empower them to protect themselves. We believe that knowledge is power. And that awareness is the best protection.
Two years ago, we launched an initiative to provide timely information on scams and fraud. We issue alerts to consumers or businesses each month flagging issues such as subscription traps, fake online reviews, fraudulent sweepstakes and many more. These alerts are getting more and more traction. Only last month, one of our alerts was featured prominently in the Ottawa Citizen.
Complementing that work is the Little Black Book of Scams, which is a publication we first rolled out in 2012. Last year, we revamped the book with new and updated tips on how to recognize, reject and report fraudsters and scams. This is a fantastic resource. It’s straight to the point and so easy to understand I’ve shared it with my kids, so they’ll learn how not to be victimized by fraud. There are some copies here today and I encourage you to take one with you to share with family and friends!
Promoting competition is the third item on our list of principles. To do this, we examine certain sectors of the economy through a competition lens. We advocate for a pro-competitive, innovation-friendly approach to regulation.
As you know, we see the critical intersection between competition and innovation. We recognize that there are important emerging issues that have significant implications for the law and for law enforcement. And we know that there remains a deep desire from citizens to have someone stand up and take action in the face of wrongdoing.
But, there is a fine line between intervening in a way that supports competition, and going too far. Regulatory interventions should be no broader than necessary. They should also be based on the best available evidence, relative to the potential harm, and be regularly reviewed.
This is the message we are consistently sending to regulators and decision-makers.
And we have a long list of interventions that we could talk about, the most recent of which is our submission to the CRTC inquiry into sales practices by telecom companies.
All this good work is only possible when we start with a clear understanding of what is at play – so we reach out.
For example, we will be reaching out directly to Canadians to inform our Broadband Market Study, in addition to receiving feedback through the usual channels. We have had a lot of useful engagement with players in the industry, including service providers, regulators and consumer associations. We greatly appreciate all the feedback we receive when we conduct these studies.
We will publish an update about our Broadband Study in the coming weeks, so stay tuned.
We see that our promotion efforts make a real difference. For example, our study on technology-led innovation in the financial services sector, or FinTech, continues to factor into policy development at the federal and provincial level.
In fact, the 2018 federal budget committed to advancing important discussions on areas that we identified as priorities in our FinTech report, such as open banking.
Also, this past spring, the government launched consultations on the Canadian Payments Act. It proposed changes that align with some of our FinTech recommendations. For instance, we advocated for opening up access to payment infrastructure and basing regulations on outcomes, rather than processes.
These are only two tangible examples of the impact our FinTech report had, but there is so much more. I strongly encourage you to read the FinTech Progress Report which we released yesterday.
Ultimately, we continue to push for competition-friendly regulation across a range of industries in large part because, as we have constantly said, competition drives innovation, and innovation is good for the Canadian economy.
The fourth principle on our list is collaboration. This is a cornerstone value at the Bureau. It’s how trust between partners can flourish. And it’s how we can better understand each other. In short, collaboration helps us do our job better.
For example, we are involved in five CBA working groups related to mergers. We are discussing matters such as increased transparency in merger reviews and the Supplementary Information Request process. These sessions have been quite productive. Through some very candid exchanges between our officers and members of the Bar, we have developed a better understanding of how we could streamline the process, without compromising our ability to carry out our mandate.
As we are aware, mergers are more and more complex and strategic. This makes our reviews more costly and complicated. And we strive to find ways to be more efficient. One of the best ways we are doing that is through our collaboration on the Competition Tribunal Bench and Bar Liaison Committee. This forum gives us an opportunity to talk about procedural matters with you. That’s proven to be valuable because together, we find ways to work smarter and be more effective. And that’s a win for everyone.
We know we can accomplish more together than we could ever accomplish alone. Our partnerships with police forces, procurement organizations and with other antitrust authorities help us detect anti-competitive activities and enforce the law more efficiently.
The Bureau continues to engage with other competition authorities. For example, just a week ago, we provided assistance to the Competition Law Institute in Guatemala, our largest bilateral trading partner in Central America. We shared advice and lessons learned as they work to develop the first competition legislation for the country.
We also recently took on the role of co-lead of the International Consumer Protection and Enforcement Network’s working group on consumer education, with our partners from Colombia. We are looking forward to sharing strategies to engage consumers and raise awareness about their rights.
Championing excellence is our fifth and final principle, and it goes without saying that this last one is certainly not least. It’s the foundation of everything we do.
Excellence means staying on top of marketplace changes, especially with the rapid pace of change brought by new and emerging technologies. To do so, we must continue to develop our capacities. We must also arm our investigators with cutting edge tools to combat illegal practices in the digital economy.
To do that, we created a new position: Chief Digital Enforcement Officer. We will be looking for the right person - the one who will help us get an edge on emerging technologies and threats. They will give us the capacity to do our best work in conducting digital intelligence gathering, detection and investigations. They will also act as an ambassador and help us strengthen the Bureau’s network within the digital enforcement community.
We are also creating a formal Merger Remedies Unit to leverage and build upon the significant expertise that we have gained from 15 years of designing, negotiating and implementing remedies in mergers. It will ensure that we are as efficient as possible and can systematically apply best practices from past remedies. This unit will be a strike force on merger files where a consensual resolution is being negotiated.
Championing excellence is also about maintaining a high-performing workforce and promoting a healthy, respectful and civil work environment. We take this commitment very seriously.
Guided by unshakable values
Being at the cutting edge of competition would not be possible without a strong sense of where we are going. As I explained in my opening remarks, a transition is just a crossing. It’s a place we’ve been before. What doesn’t change is the work we do and why we do it. We are guided by unshakable values.
That fact is highlighted in our Annual Plan, where we observe—quite rightly—that we continue on the course we have been on for over five years now. And we will continue on this journey guided by our core values. You see the proof in the areas I’ve covered today.
We stand for openness and transparency. You see that in the work we publish.
We stand for integrity and fairness. You see that in our unwavering dedication to evidence-based, principled and independent enforcement and advocacy.
We stand for respect. While we tackle tough questions together, it’s important to remember that civil dialogue is essential to help us advance competition issues and best serve the public interest.
We stand for collaboration. You see it right here today in this room with the powerful legacy of work undertaken together by the Bureau and the CBA.
And we stand for continued leadership, as evidenced in the work I’ve outlined today, including the way we define what it means to stay at the cutting edge of competition.
To conclude, when we collaborate respectfully and professionally to advance competition law and policy, we all win. Your clients benefit from competitive markets just as much as Canadian consumers do.
Ultimately, what makes the work we do possible is the dedication, professionalism and passion of the Bureau employees I have surrounding me. They are the reason why this crossing is a period of steady progress. We are not slowing down. We continue on this course, guided by our core principles and values. To my team, thank you for your incredible and invaluable work.
Thank you also to all of you here today for your ongoing collaboration. I look forward to more of that in the times ahead.
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