While details remain to be seen, the clear tone and direction in
Ottawa is that there will be important changes to the
Competition Act in what is being described as a
"Consumers First" Economic Action Plan for 2014 (Budget),
tabled before the House of Commons on February 11, 2014.
Among the proposed changes we are monitoring:
The Government of Canada announced that over the coming months
it intends to introduce legislation to address country-specific
pricing strategies. The government says it will target companies
that use "market power" to charge higher prices in Canada
than in the U.S. where these prices are not justified by legitimate
higher operating costs.
The Commissioner of Competition will enforce this new framework.
This proposed initiative is in line with the government's
throne speech from last October, where it indicated a renewed
commitment to consumer protection, including taking further action
to end what the government saw as geographic price discrimination
against Canadians. For more information, see our October 2013 Blakes Bulletin: Recent Developments in Canadian Competition
Law and Foreign Investment.
The government also continues to focus on the telecommunications
industry and may introduce a number of legislative measures in the
coming weeks and months, including:
an interim cap on wholesale domestic wireless roaming rates to
be in place until the Canadian Radio-television and
Telecommunications Commission (CRTC) completes public
new powers for the CRTC and Industry Canada to impose
administrative monetary penalties on companies that violate
established rules such as the Wireless Code; and
enhancing information sharing by the CRTC and Industry Canada
to enable greater cooperation with organizations such as the
Some of these changes will be hard to implement effectively.
Rate-setting has long been a blunt and inflexible instrument in
regulatory settings. Moreover, finding a way to account fairly for
pricing strategies between two very different countries seems like
an intractable challenge. What is clear is that changes will be
coming to the Competition Act in one form or another,
which will represent additional compliance challenges for
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