Departmental Performance Report — For the period ending March 31, 2009

3.4 Additional Information for Program Activities by Strategic Outcome

Strategic Outcome: A Fair, Efficient and Competitive Marketplace

Strategic Policy Sector — Marketplace

Expected Result: Development and coordination of economic policy frameworks that support a fair, efficient and competitive marketplace

Performance Indicator	Results	Trend
Number of policy initiatives, including legislative and regulatory amendments tabled and approved, aimed at supporting a fair, efficient and competitive marketplace in Canada (e.g., corporate, insolvency, intellectual  property, investment, international trade and competition policy)	5 bills tabled: C-61: An Act to amend the Copyright Act C-62: An Act respecting not-for-profit corporations and certain other corporations (Canada Not-for-profit Corporations Act) C-4: An Act respecting not-for-profit corporations and certain other corporations C-10: An Act to implement certain provisions of the budget tabled in Parliament on January 27, 2009, and related fiscal measures (Budget Implementation Act, 2009) C-4: Canada Not-for-profit Corporations Act 1 set of regulatory amendments was published Regulatory amendments were implemented to the Industrial Design Regulations 2 internal trade protocols amending the Agreement on Internal Trade were adopted	Not applicable*

* Trends in performance indicators are not useful to measure due to the nature of the work of this program activity, where actual results vary from year to year depending on the current agenda and priorities of the government. Recognizing the inherent difficulties in measuring the performance of the program activity, Public Policy Services has been moved under Internal Services in the 2009–10 Program Activity Architecture.

2008–09 Financial Resources ($ millions)				2008–09 Human Resources (Full-Time Equivalents)
Planned Spending	Total Authorities	Actual Spending		Planned	Actual	Difference
12.6	18.2	18.1*		113	117	4

* The variance can be explained by the transfer of funds for new responsibilities.

Meeting our commitments:

In support of a fair, efficient and competitive marketplace, and in response to the Competition Policy Review Panel’s recommendations, Industry Canada amended the Competition Act and the Investment Canada Act contained in the Budget Implementation Act, 2009, Bill C-10, which received Royal Assent on March 12, 2009. As set out in its report, Compete to Win, these amendments respond to the Panel’s core recommendations for modernizing Canada’s competition and foreign investment laws and policies and better protecting consumers and promoting their interests by encouraging lower prices, better choices, and new products and services. Bill C-10 will also make Canada more competitive globally by creating jobs and opportunities for Canadians, attracting investment, improving productivity and innovation, and safeguarding Canada’s national security interests.

Industry Canada worked with other federal departments, provinces and territories in support of a federal/provincial/territorial Ministers' agreement on amendments to the Agreement on Internal Trade (AIT) that provided for labour mobility within Canada and strengthened the AIT’s dispute settlement process for government-to-government disputes. Further to the direction of First Ministers at their meeting on January 16, 2009, Industry Canada began work with the provinces and territories to develop a work plan for the harmonization of business standards and regulations in key areas.

The Department actively participated in Anti-Counterfeiting Trade Agreement (ACTA) negotiations with the objective of strengthening international efforts to address trademark counterfeiting and copyright piracy.

Small Business and Marketplace Services and Regional Operations Sector — Marketplace

Expected Result: Marketplace fairness, integrity and efficiency are protected through regulation and promotion in the areas of insolvency, weights and measures, federal incorporation, and spectrum management

Performance Indicator	Results	Trend
Number of rules and requirements that are updated or reviewed to ensure relevance and responsiveness to marketplace needs	In support of the administration of the Weights and Measures Act and the Electricity and Gas Inspection Act, 3 regulatory amendment packages were introduced and 25 policy bulletins and technical specifications were developed or revised All Bankruptcy and Insolvency Act (BIA) regulatory instruments reviewed, many instruments amended, and 6 new Rules and 7 new Forms created 19 new Regulations and 4 new Forms created under the Companies’ Creditors Arrangement Act 1,035 rules and requirements dealing with federal incorporation were updated or reviewed	New indicator
Client awareness of marketplace rules and regulations governing incorporation, bankruptcy, insolvency, and measurement	2,443,656 Internet visits were made to Industry Canada websites dealing with incorporation, bankruptcy, insolvency, and trade measurement, up from 1,672,862 in 2007–08	Improving
Percentage of authorized radio stations operating in compliance with their authorized parameters as determined by a statistically sound sample for a given category	71.4%; up from 70% in 2007–08*	Improving

* Most frequent discrepancies identified are station location and unauthorized frequencies, which have the biggest impact on electromagnetic compatibility (EMC). To improve compliance, we plan to continue to raise awareness with equipment installers and hold non-responsive installers and users accountable for non-compliant installations with the use of selective enforcement. To better measure the impact of the follow-up compliance measures we put in place, the next national inspection program planned for 2011–12 will consider only new stations and stations amended since 2008.

2008–09 Financial Resources ($ millions)				2008–09 Human Resources (Full-Time Equivalents)
Planned Spending	Total Authorities	Actual Spending		Planned	Actual	Difference
95.6	116.6	107.3		1,098	1,044	-54

Meeting our commitments:

In 2008–09, Industry Canada conducted in-depth consultations in the chemical products, food and beverage manufacturing, livestock and poultry, and fruit and vegetable sectors to obtain stakeholder views and recommendations on how measurement accuracy should be achieved and monitored in these marketplace sectors. Through the establishment of sector-specific marketplace approaches to achieving and monitoring measurement accuracy, stakeholder needs and expectations were addressed and a suitable level of government intervention was afforded, contributing to a fair, efficient and competitive marketplace. Other consultations were also held to improve incorporation service across the country through inter-jurisdictional partnership, witnessed through the active participation of partners, including provinces and territories, in developing and formulating the new NUANS® governance structure.

To ensure marketplace fairness and efficiency in spectrum management, the new Radiocommunication and Broadcasting Antenna Systems procedures were published in January 2008. They came into effect in July 2008, after a 6-month transition period, to allow the thousands of stakeholders across Canada, industry, government and the public time to adapt to the updated process. The key changes include one process for all antenna structure usages, clearer processes for public notification and consultation, and added community involvement. As well, the Department developed a draft Spectrum Management Operations Plan for the Vancouver 2010 Olympic and Paralympic Winter Games. The document outlines the plans to permit Industry Canada to provide the optimum level of spectrum management services prior to and during the event.

Spectrum, Information Technologies and Telecommunications Sector — Marketplace

Expected Result: Canada’s radiocommunication and telecommunications infrastructure and online economy are governed by a modern and appropriate policy framework

Performance Indicator	Results	Trend
Percentage of policies, legislation and regulations developed, updated or reviewed as identified in annual branch business plans / strategic plans	90% of planned initiatives were undertaken including: the production of policies and standards for many bands that will enable new technologies and services in Canada the drafting of anti-spam legislation and exploring legislative options to update the Personal Information Protection and Electronic Documents Act (PIPEDA) the release of the revised policy paper entitled Licensing Framework to Auction Spectrum for Air-Ground Services 3 CRTC decisions reviewed by the Governor-in-Council	New indicator

 

2008–09 Financial Resources ($ millions)				2008–09 Human Resources (Full-Time Equivalents)
Planned Spending	Total Authorities	Actual Spending		Planned	Actual	Difference
58.9	68.2	65.0*		357	337	-20

* The variance between Planned Spending and Actual Spending relates to the increased salary costs from collective agreements and retroactive pays, as well as internal funding reallocations towards program legislative and regulatory priorities relating to spectrum / telecom management.

Meeting our commitments:

Industry Canada has made significant progress in advancing Canada’s radiocommunications and telecommunications frameworks, which includes infrastructure, spectrum management and policy. In addition to licensing $226.6 million annually in spectrum and radio licences, the Department held the Advanced Wireless Services (AWS) auction in 2008, which concluded successfully and raised over $4 billion. This spectrum is to be used for advanced wireless services such as high-speed Internet and mobile devices.

The Department also completed the Digital TV Post-Transition Allotment Plan, which reserves a part of the current television spectrum for digital television use and allows other services to use the remainder. The Allotment Plan provides a channel for each television station. This plan has been coordinated with the U.S. plan. The transition to digital television is set to be completed by August 31, 2011.

Industry Canada ensured that spectrum and telecommunications are available for public safety and emergency purposes. This includes readiness exercises for the Vancouver 2010 Winter Games, maintaining partnerships with stakeholders in both the private and public sectors, and completing the initial phase of a study on the resilience of the Canadian wireless infrastructure. In addition, various operational drills were executed to ensure equipment and government-related procedures were understood and effective in responding to a crisis.

On the international front, Industry Canada concluded 2 new frequency-sharing Arrangements with the U.S. dealing with advanced public safety and commercial broadband mobile systems operating in the 700 MHz band. These treaty-binding Arrangements will secure equitable access to this very valuable radio spectrum for Canadians. Industry Canada also hosted a French delegation to discuss the establishment of a Canada-France working group for emergency telecommunications and held weekly video conferences with the National Communications Center (U.S.) to share intelligence on telecommunications security issues such as vulnerability assessments and cyber threats. The Department has 10 new Canada–U.S. Arrangements awaiting final ratification by Parliament and another 8 Arrangements under negotiation with the U.S. Federal Communications Commission. These Arrangements provide the technical basis for equitable access to radio spectrum in the border regions for new and existing wireless systems. Finally, Industry Canada made advances on its Mutual Recognition Agreements (MRAs) on Conformity Assessment of telecom apparatus. All such MRAs are now required to be treaty-based. This will delay the Israel and Japan MRA goals by at least 1 year. The Asia-Pacific Economic Cooperation Telecommunications (APEC TEL) MRA, already in place, is steadily adding signatory economies with Singapore and Chile likely to join in the next 6 months. The text for a new MRA on mutual recognition of technical equivalence has been agreed at APEC TEL.

Industry Canada actively participated in World Telecommunication Standardization Assembly (WTSA) 2008, held under the auspices of the International Telecommunication Union. Overall, the outcome of the WTSA was highly successful, with the majority of Canadian objectives, positions and perspectives reflected in the results. Key decisions included global agreement on a more streamlined study group structure in line with industry interests and priorities, as well as the adoption of resolutions on accessibility for persons with disabilities and climate change.

Lessons Learned:

Industry Canada has commenced work in support of Public Safety's Critical Infrastructure Protection Program, and specifically developed a profile of the ICT sector. In addition, the Department continued the second phase of the wireless infrastructure resilience study to understand the state of resilience of the Canadian wireless infrastructure and its vulnerability to disasters, whether natural (e.g., pandemic, floods, ice storms) or human-induced (e.g., terrorism, computer viruses). While the study commenced in fiscal year 2008–09, delays were encountered and the work will instead be completed by July 2009. A probability/impact mapping exercise has been undertaken with security experts from the major telecommunications companies to understand the risks of electronic intrusion to the telecommunications networks.

Periodic exercising and engagement of the industry offer opportunities to identify gaps in telecommunication resiliency. To date, we have identified the need for the establishment of a permanent Emergency Telecommunications Operations Centre and a formal telecommunications exercise schedule to be undertaken by Industry Canada.

Office of Consumer Affairs

Expected Result: Consumer interests are protected and promoted throughout Canada

Performance Indicator	Results	Trend
Number of major challenges being addressed and/or documented that affect the consumer interest in Canada	4 consumer challenges (consumer debt, consumer literacy, use of alternative forms of credit, and the risk of identity theft) were continually addressed through research, advocacy and outreach	New indicator

 

2008–09 Financial Resources ($ millions)				2008–09 Human Resources (Full-Time Equivalents)
Planned Spending	Total Authorities	Actual Spending		Planned	Actual	Difference
5.1	6.4	6.3*		23	22	-1

* The variance can be explained by the fact that the Office of Consumer Affairs received further funding through supplementary estimates A and B.

Meeting our commitments:

Industry Canada, through the Office of Consumer Affairs (OCA), completed submissions concerning federal designation orders under the Criminal Code payday lending exemption for the province of Manitoba (order proposed in May 2008 and made official in June 2008) and for the province of Nova Scotia (order proposed in March 2009). In 2008–09, the OCA led the development of a joint federal/provincial/territorial discussion paper on services to help consumers recover from identity (ID) theft. In order to promote consumer confidence and address major consumer challenges, the Department also undertook research focusing on consumer vulnerability, the electronic marketplace and sustainable consumption. Evidence-based submissions were made to internal, interdepartmental and intergovernmental forums in support of modern frameworks for electronic payments, consumer credit reporting, financial literacy and telecommunications. Consumers were provided with a new information product on digital television and an information series of 5 topics including debt and identity theft was completed for Canadians with low literacy skills. The OCA also released the 2008–09 version of The Canadian Consumer Handbook.

Industry Canada also completed 2 studies on consumer detriment and low literacy and geographic isolation for use in preparing a strategy to mitigate challenges faced by the most vulnerable consumers. Additionally, the Department reached out to literacy groups, correctional centres, workforce re-entry centres and educational institutions to promote its online debt and financial management guides and ensure they can be understood by consumers with low literacy skills.

A usability assessment and content audit of the OCA website was conducted to ensure that all information remained relevant and timely, and a series of information products about the transition to digital broadcasting was developed and posted online.

Competition Bureau

Expected Result: The Canadian economy is efficient and adaptable due to the competitiveness of prices and choices available to consumers

Performance Indicator	Results	Trend
Percentage of economy subject to market forces	Approximately 82% of the Canadian gross domestic product (GDP) is subject to market forces*	New indicator
Dollar savings to consumers from Bureau actions that stop anti-competitive activity	Estimated savings of $254 million (criminal enforcement only)**	New indicator

* According to a study conducted by the Competition Bureau in 2005, the proportion of economic activity covered by the Competition Act has increased by 103% since its enactment in 1986.

** Estimated overcharge to consumers (or economic harm) for the duration of the infraction, prior to Bureau actions concluded in FY 2008–09. This is a conservative estimate based on similar methodologies used by anti-trust agencies in other countries.

2008–09 Financial Resources ($ millions)				2008–09 Human Resources (Full-Time Equivalents)
Planned Spending	Total Authorities	Actual Spending		Planned	Actual	Difference
49.8	62.2	59.1		452	438	-14

Meeting our commitments:

Combatting domestic cartels and illegal bid-rigging agreements was a priority for the Competition Bureau in fiscal year 2008–09 and key to ensuring that the Canadian marketplace is fair and competitive. Industry Canada, through the Competition Bureau, uncovered a conspiracy to fix the price of gasoline at the pump in the province of Quebec. As a result of that investigation, 13 individuals and 11 companies were charged. As of March 2009, 6 companies and 8 individuals had pled guilty, fines totalled over $2.6 million and imprisonment terms totalled 44 months.

Charges were laid against 14 individuals and 7 companies accused of rigging bids in order to obtain Government of Canada IT services contracts worth approximately $67 million. In addition, the Bureau continued to support prevention and detection by educating buyers and sellers to identify and report potential bid-rigging schemes. It conducted 51 bid-rigging presentations for approximately 2,020 people, representing businesses across the country and all levels of governments. 15 organizations that had participated in the presentations informed the Bureau that they had implemented changes to their tendering process.

The Bureau continued to advocate for the introduction of greater competition in the regulated health sector. With the release of its 2008 study, Benefiting from Generic Drug Competition in Canada: The Way Forward, the Bureau offered tangible recommendations on where potential government and consumer savings of up to $800 million were being lost. One province, Manitoba, has amended its public drug plan policies on the basis of the Bureau’s recommendations and the Bureau continues to consult with other provinces and territories on potential reforms.

The Competition Bureau also targeted the increasing number of misleading and fraudulent performance claims affecting consumer health over the Internet. In collaboration with domestic and international partners, the Bureau successfully took action against almost 100 Canadian-operated sites, 99% of which complied with the Bureau’s demands to modify, remove or substantiate cancer-related claims made to promote products or treatments. In partnership with the Canadian Cancer Society, the Bureau distributed an education pamphlet to provide consumers with information on how to protect themselves from fraudulent health claims.

The Bureau continued to cooperate with foreign counterparts to combat anti-competitive practices that cross borders. In April 2008, the Bureau signed a cooperation arrangement with the U.S. Postal Inspection Service to facilitate enforcement cooperation, coordination and information sharing. In 2008, the Bureau participated in Operation
Tele-PHONEY, a cross-border comprehensive attack on telemarketing fraud. Also, for the first time, a Bureau investigation into deceptive telemarketing resulted in the extradition to the U.S. of 3 Canadian operators.

As part of the Competition Bureau’s ongoing commitment to establish best practices in the manufacturing and retail sectors, the Bureau examined the use of rebate programs, including delayed payment rebates such as mail-in or online rebates. The Bureau developed and released, for public comment, the Draft Information Bulletin on Consumer Rebate Promotions, which outlines the Bureau’s approach to interpreting the false or misleading representations provisions of the Competition Act, the Consumer Packaging and Labelling Act, and the Textile Labelling Act in the area of consumer rebate promotions.

The Bureau also reviewed mergers and acquisitions and challenged those few that resulted in a substantial lessening or prevention of competition. For example, the Bureau’s work led to a Consent Agreement with Superior Plus L.P. (Superior), resolving the Bureau’s competition concerns arising out of Superior’s proposed acquisition of certain assets of Irving Oil Limited and Irving Oil Marketing Limited. Further, following a closely integrated investigation by the Bureau and the U.S. Department of Justice, Google Inc. and Yahoo! Inc. abandoned a potentially serious anti-competitive advertising agreement. In addition, Dow Chemical agreed to certain divestitures and other commitments to address the Bureau’s competition concerns regarding its acquisition of Rohm and Haas. Over the course of its extensive review, the Bureau consulted with counterparts at the U.S. Federal Trade Commission and the European Commission's Competition Directorate.

Lessons Learned:

In order to enhance its capacity to conduct effective and timely investigations, the Competition Bureau established and intends to build on strong partnerships with the international competition community. For years, international cooperation has proven important in cartel investigations. More recently, the Bureau has had similar success in the mergers context. Specifically, where the Bureau is satisfied that a particular remedy will adequately address Canadian issues, it will suggest and/or implement the remedy agreed to in another jurisdiction.

Canadian Intellectual Property Office — Revolving Fund

Expected Result: The delivery of and quality of CIPO’s services respond to client needs and expectations

Performance Indicator	Results	Trend
Percentage overall satisfaction of clients with CIPO’s services	74% of clients were satisfied or very satisfied with CIPO’s services, down from 79% in 2005	Declining
Expected Result: Increase awareness and use of intellectual property by SMEs
Performance Indicator	Results	Trend
Percentage of SMEs that are aware of / familiar with IP	Baseline of 36% established in 2006–07 (next survey: 2010–11)	Not applicable (next survey: 2010–11)

 

2008–09 Financial Resources ($ millions)				2008–09 Human Resources (Full-Time Equivalents)
Planned Spending	Total Authorities	Actual Spending		Planned	Actual	Difference
4.9	139.5	12.9*		1,030	944	-86

* Although CIPO and its clients have been operating in tenuous economic conditions, a positive variance in net operating income was incurred. This variance is primarily due to the prudent management of expenditures, lower investment in capital, and changes under various Balance Sheet accounts such as the deferred revenue and accounts payable. We anticipate utilizing the positive variance in future years to maintain current operating levels and to fulfill CIPO’s strategic objectives.

Meeting our commitments:

CIPO’s most recent National Client Survey showed a slight decline in client satisfaction from 2005 to 2008. CIPO is focused on becoming more efficient, accessible and responsive to clients, looking to help them strengthen their competitive advantage both domestically and globally. To better meet clients’ needs, CIPO enhanced its level of client service in several areas. Turnaround times for key client processes related to copyrights and industrial designs were improved. The Office improved client communication and provided electronic access to a wider range of CIPO services. Client-centric changes include improved access to information on patents, trademarks and copyrights, and online access to the entire Canadian Industrial Designs database.

Aligned with the government’s efforts to mobilize science and technology to Canada’s advantage, CIPO increased outreach efforts towards SMEs and Canadian students. CIPO continues to modernize its e-services platform through the Enterprise Business Renewal Initiative. This and other initiatives are aimed at improving client access to quality intellectual property (IP) rights in a timely fashion, enhancing the bilingual search capabilities of CIPO’s databases, and creating a more user-friendly website.

To improve awareness of IP, CIPO undertook projects in the education and SME sectors to increase the understanding of the effective use of IP by students, creators and innovators; piloted educational tools for university students in science and engineering faculties; prototyped IP data research tools for SMEs; and developed and delivered IP training for intermediaries to leverage their reach to multiple sectors. The Office also formed a new working group with Australia and the United Kingdom (called the Vancouver Group) to explore collaborative initiatives, share best practices and research findings, and to compare performance trends.

A new chapter of the Manual of Patent Office Practice (re: biotechnology) was issued to improve practices, and consultations were completed on 2 packages of regulatory amendments to the Patent Rules. Amendments were also made to the Industrial Design Regulations and a new Opposition Practice Notice was issued by the Trade-marks Opposition Board.

Lessons Learned:

CIPO conducted its first round of information sessions on e-services with clients in 5 Canadian cities with the objective of presenting its latest e-services and gathering input for future improvements. The sessions were successful in engaging clients in providing input and working with CIPO on ongoing e-service developments. Through the sessions, the Office learned that clients would like to participate in these types of sessions on a regular basis, and planning is now underway to organize another round of sessions.