Building a More Competitive Canada

Speech

Remarks from Matthew Boswell, Commissioner of Competition

Centre for International Governance Innovation

May 26, 2022

(As prepared for delivery)

Thanks for the invitation to speak with you today on the traditional, unceded territory of the Algonquin Anishnaabeg People. The area surrounding Chaudière Falls — not far from here — is considered sacred to Anishinaabe people throughout Turtle Island. It’s known as Asinabka (“the place of glare rock”) to all Algonquins.

The Centre for International Governance Innovation is also a gathering place. Of ideas. And of people. All meeting at the intersection of technology and international governance.

Gatherings like this are how change happens. And it’s why this is the right place for me, as Canada’s Commissioner of Competition, to do three things today:

  • To talk about the importance of competition in Canada.
  • To share ideas about where things are going.
  • And to talk about the importance of public engagement in how we define and enable competition in this country.

I’ll expand on each point. Starting with the first: the importance of competition in Canada …

Why competiton matters

Let’s begin by asking: why does competition matter, really? It matters because a strong economy is a competitive one. Competition boosts productivity. It helps keep prices in check, a point I’ll return to in a moment. And it benefits citizens. Not just some of them: all of them.

Those benefits include:

  • Lower prices, more choice and higher quality for consumers.
  • Stronger businesses that are incentivized to perform and innovate.
  • Giving small- and medium-sized companies a fair chance to compete and win, at home and abroad.

There are plenty of challenges now in the world. A long global pandemic. War in Ukraine. And inflation the likes of which we’ve not experienced in two generations. All of these have real consequences for our economy. Thus, an important conversation has started anew about competition and its role in our economic health. Much of it is about Canada’s competition laws and the need to modernize them for the digital marketplace.

In the public debate, some just want to maintain the status quo on competition. Others say it’s well past the time for changes. I think you know where I stand, based on my record as Commissioner. We must adapt. Our future demands it. 

Where things are going

That takes me to my next major point: where are things going in the realm of competition? An important conversation is taking shape about the role of competition in the Canadian economy. It’s occurring against a backdrop of increasing concerns about the rise of corporate titans and the changing nature of our digital marketplace. New thinkers have engaged in the debate.

Parliamentarians have noticed this. Last October, Senator Howard Wetston launched a consultation, examining the federal Competition Act in this digital era. We were part of that discussion. Next, Minister Champagne announced a careful look at how to improve the Act. Then the federal Budget was tabled. It proposed amendments to the Competition Act as a first step in modernizing the way we promote and protect competition in Canada.

This is meaningful progress in a short period of time.

Significant amendments are proposed as a first step. They would enhance the Bureau’s investigative powers, criminalize wage-fixing and no-poach agreements, increase maximum fines and administrative monetary penalties.

They would clarify that incomplete price disclosure is a false or misleading representation.

They also would expand the definition of anti-competitive conduct, allow private access to the Competition Tribunal to remedy an abuse of dominance and improve the effectiveness of the merger notification requirements.

The Bureau is fully committed to communicating and applying these changes, should they become law.

The next point about where things are going: everyone has a stake in ensuring healthy competition. With Minister Champagne spearheading the modernization of our laws, we’ll be having a much-overdue debate on what competitive marketplaces should look like. This can’t be a debate where we argue in circles. Fixing the problems is something that matters a lot to Canadians. And to me.

So let’s now revisit the point about the high inflation that we’re all dealing with now. A visit to the gas station or a grocery store these days can be anxiety inducing for many Canadians. Speculating on the causes of inflation isn’t why I’m here today. But competition has to be part of the solution. Open, competitive markets are critical to keeping prices in check.

Know this: Less competition makes matters worse. More competition makes them better. And not just on the price side of things. Vigorous enforcement of competition laws is necessary. It deters business conduct that could otherwise make inflation worse, due to collusion with rivals or harm to the competitive process.

Vigilance matters, too. Yes, much of the Bureau’s current enforcement work is confidential. But I can assure you we have zero tolerance of any attempt to use the current economic context to engage in anti-competitive conduct.

We also work closely with partners. Along with the US, UK, Australia and New Zealand, we’re part of an international working group, focused on sharing information to identify and prevent potential collusion on a global scale, including anti-competitive conduct related to supply-chain issues.

Healthy competition can indeed make things better. While it’s not the silver bullet to combat inflation, more competition must be part of the solution to help address the rising cost of living.

As the Bureau noted in our letter to the Bank of Canada in 2020, "competition lowers inflationary pressures." It helps Canadians access a wider range of products at lower prices. That’s why leading thinkers call for pro-competitive policies to reduce trade barriers, to foster greater competition in digital markets and to modernize our competition laws. But beyond this, there’s a role for governments at all levels to examine policies and regulations to ensure they encourage— and not undermine—competition.

Open markets—where newcomers can grow and challenge incumbents—are at the heart competition. It’s what incentivizes value creation. It rewards innovation. Government rules and regulations can often affect how open our markets truly are.

Competition drives productivity. Canada’s falling behind on economic productivity, and it’s time we do something about that. The new federal budget is clear on this. As I see it, the review of Canada’s competition framework goes hand-in-hand with the drive for productivity and economic growth. This is another reason why a competition law review is so important and why all policymakers should consider how regulations can leave room for competition to thrive.

Competitive intensity is vital to driving innovation and productivity. As I’ve explained, it’s how firms gain a competitive edge on rivals, driving up productivity growth and boosting our standard of living.

If we do this right, we can keep growing, keep competing and keep succeeding … well above our weight class. Or we can get it wrong. We can stifle competition — whether due to anti-competitive behaviour or regulatory impediments. And suffer.

Don’t just take my word for it. In 2008 — the last major review of Canada’s competition policy — the Competition Policy Review Panel’s final report said: “Greater competition is the key to increasing productivity and prosperity.” … (It) drives the productivity that ultimately sustains our incomes, jobs and quality of life.” We do this not just because it’s a good idea. But also out of necessity for a better future.

I’m also reminded of what Tom Jenkins, Chairman of OpenText and one of Canada’s leading thinkers on innovation, said. He said  that despite knowing the critical impact of competition, much of our discussions on innovation still focus on policy and program activity. And not on how to increase competition.

Competitive intensity, he says, “is the elephant in the room.”

So how do we get past the learned habit of talking endlessly about innovation and productivity as though solutions are elusive … and instead focus on producing outcomes? Here’s how.

We build a competition culture. Together.

Culture is like a frame on a painting. It shows us where to look. It puts borders around what matters. If we truly want Canadian markets to thrive in the digital economy, we must develop a culture that embraces competition.

That’s our focus at the Bureau. It’s right there in our strategic vision, blazing a path that we started in 2020. Here’s what it says: “To be a world-leading competition agency, one that is at the forefront of the digital economy and champions a culture of competition for Canada.”

Here’s how we’re executing on that vision.

Our new Annual Plan for 2022-23 defines our priorities. And gives context to what we’re doing in the present tense. On the enforcement side, we’ve created a new Digital Enforcement and Intelligence Branch. It’s our centre of expertise on continually evolving business practices and technologies and their impact on competition. It’s making us better, smarter and faster, by using advanced analytics, intelligence techniques and behavioural economics to find harm in the marketplace and work with our enforcement branches to stop it.

We’re being vigilant about the lingering challenges created by the pandemic. That includes anti-competitive conduct related to supply-chain issues. Our plan also includes focusing on sectors of the economy that are vital to Canada’s long-term economic well-being, like digital services, telecommunications and health.

In the telecommunications market, we’re seeking to block Rogers’ proposed $26 billion acquisition of Shaw to protect Canadians from higher prices, poorer service quality and fewer choices.

Eliminating Shaw would remove a strong, independent competitor in Canada’s wireless market – one that has driven down prices, made data more accessible, and offered innovative services to its customers.

We are taking action to block this merger to preserve competition and choice so that  Canadians can have access to affordable and high quality wireless services.

We’re also advocating for new, pro-competitive policies, particularly in the markets where Canadians want to see changes now, including health.

Soon, we’ll begin publishing the results of our Digital Health Care Market Study. Our reports will make important recommendations on bringing greater innovation, choice and access to digital health care across the country. I’m excited for you to read them.

We’re broadening our thinking on the interplay between competition policy, the environment and efforts to address climate change. Thinking means listening first.

So on September 20th in Ottawa, we’re hosting the Competition and Green Growth Summit so we can better understand these complex issues. And to do so by drawing on insights of experts, including domestic and international enforcement partners. Then we can decide how it must inform the Bureau’s enforcement and advocacy work.

Listening and learning are lifelong jobs. And that takes me to the third and final major point I want to cover today …

Public engagement

Let’s talk about the importance of public engagement in the way we must define and further enable competition in Canada.

In the times ahead, engagement will be a very important part of the culture of competition that I’ve spoken about here today. Beyond amendments to the Competition Act in the Budget, there’s going to be a very important round of public consultations on competition policy. We need to make sure we hear a broad set of ideas and perspectives.

This is going to task everyone to apply big-picture thinking about the level of competition we want to see in our economy. It’s of vital importance to the interests of consumers, workers and businesses of all sizes. It’s that big of a deal.

Like I said earlier: we all have a job to do to stand on guard for the opportunities that are right there for us to unlock. Which we can. If we use fully the levers of competition and innovation. And reap the ensuing benefits. But that’s up to each of us as citizens, as consumers, as workers and as business owners to choose.

We must want this for ourselves. And the way we choose this is by getting engaged in this public consultation process.

Wrapping up

To wrap up: my job here today (and every day since 2019) is to persuade you to consider the importance of competition to a healthy economy. The one we have now and in the future.

Competition doesn’t just happen. We must choose it for ourselves. I’ve shown you today how important it is to our day-to-day life. It empowers us. It gives us better choices. It also safeguards us against the risks of an unchecked marketplace. Competition is indeed the engine of innovation. And not just for ourselves: for the generations to come, too.

Given the challenges on the road ahead, it’s what is going to keep things moving forward in a way that’s fair, shared and prosperous for all.

Let’s remember that for too long, competition was a niche issue for lawyers and economists. We’re changing that. Think of competition policy as a kind of market. It has incumbents defending the status quo. It has new entrants, trying to disrupt things. And the biggest barrier to entry to participating in this market, which is to say this debate, is the language we use.

Competition is everyone’s business now. We all must speak in plain, accessible language about it. Beyond just the antitrust stakeholders, open up the conversation to those who bring fresh expertise. Listen to diverse, lived experiences. This enriches the conversation. Likewise, accessible language helps businesses understand whether their conduct is lawful. It empowers people to make complaints about alleged anti-competitive behaviour.

I invite everyone to participate in this important process over the coming months. Let’s build a more competitive Canada.

Thank you.

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