Remarks by John Pecman, interim Commissioner of Competition

Vancouver Roundtable Speech – Hosted by McMillan LLP

Vancouver, BC
December 5, 2012

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Introduction

I'd like to thank you for inviting me to join you today. Coincidentally, December 5 has been designated "World Competition Day" by the Consumer Unity and Trust Society (CUTS) International, together with their colleagues at the United Nations Conference on Trade and Development (UNCTAD). This year's focus is on the impact of cartels on the poor.

Many foreign agencies celebrate "Competition Days", and as the Bureau aims to develop a more collaborative approach with all of our stakeholders, the benefits of such events that bring interested parties together to discuss competition law and policy are apparent.

I am pleased to be here with you this morning and to share some of my thoughts about the Bureau, and our current priorities.

But more importantly, I look forward to hearing from you – about the Bureau, and your views on the state of Competition Law in Canada.

I want to begin today touching on the fundamentally important role the Bureau plays – in a competitive Canadian economy, in the growth of Canadian businesses and in the lives of Canadian consumers.

In 2007, the Competition Policy Review Panel, chaired by Red Wilson, released its report to the Minister of Industry.

In it, the Blue Ribbon panel underscored the importance of competition and competition policy to Canadians, in that it:

  • Provides the Canadian workforce the opportunity to work for more productive, innovative companies, earn higher wages and pursue rewarding careers.
  • Provides Canadian consumers better products, lower prices, more choice and better service
  • And, for our economy, it is the strongest spur to innovation and value creation – leading to a higher standard of living for all Canadians.

I think you'll agree that the Bureau is a vital component of a prosperous, growing, Canadian economy and when we do our job well – everyone benefits.

So, I take our mandate and my job in leading the Competition Bureau to deliver on that mandate very seriously.

After a few months as Interim Commissioner, I have had the time to reflect and consider how we can best deliver on our mandate, going forward. From this, have come three priority areas that we will focus on in the weeks and months ahead.

They are:

  • Benefitting Canadians, through focused enforcement and through strategic regulatory interventions;
  • Applying Canada's competition laws in a transparent and predictable manner
  • And, building trust through enhanced collaboration.

Delivering on these priorities is how we will continue to ensure that Canadian businesses and consumers prosper in a competitive marketplace.

But, we can't do this alone.

This is why collaboration with people like you, our stakeholders, our partners, and our colleagues is so critical. In my view, we are all competition keepers.

Successful collaboration is built on mutual trust, and trust must be established through open lines of communication.

This is why my priority for the Bureau in the coming months is – building trust through collaboration between the Bureau and all its stakeholders.

To be clear, to me, collaboration does not mean retreating from, or weakening our enforcement mandate.

Quite the opposite. In my opinion, the Bureau's strongest asset is its dedicated enforcement and support team that promotes deterrence through its efforts.

Deterrence can also be enhanced through collaboration, since the Bureau can, for example:

  • increase compliance through providing transparency and predictability regarding its work; and,
  • use relationships and partnerships to learn about and pursue anti‑competitive conduct.

Building trust: externally

I believe that transparency, certainty and predictability are the lynchpins of our future success.

Canadian consumers and the business community deserve some certainty as to what they can expect from the Bureau.

To that end, in the coming months, we will be working collectively with the bar, pursuant to our mutual collaboration initiative:

  • To clarify our investigative procedures;
  • To discuss issues that have arisen in the context of electronic document production;
  • To develop clear guidelines on the Price Maintenance provisions; and
  • To update the Immunity and Leniency programs, to reflect developments and to respond to feedback from our stakeholders regarding areas which are not clear.

In order to foster a greater understanding of the work that we do – and to receive feedback on how that work impacts both Canadian consumers and our stakeholders, we will be engaging stakeholders, like you, more regularly.

Businesses

This will include the Bar, other government agencies, the international community, academics, Canadian consumers and the business community.

And within the business community, we will be reaching out to business groups and procurement authorities about the nature of our work and the importance of compliance with our laws.

Consumers

Where consumers are concerned – we are committed to deepening their understanding of the work that we do and how it impacts them.

Conversely, consumer feedback plays a critically important role in informing the work that we do.

Consequently, we will continue to listen to Canadian consumers' concerns and to investigate in strategic and targeted areas that make a difference to Canadians' lives.

Counterparts

On the international front, as there are a growing number of countries with competition laws and as bilateral trade and cooperation agreements often expressly contemplate coordination between anti-trust agencies, one of the ways in which we bolster our ability to investigate matters is through our collaboration with international partners through fora like the OECD, the International Competition Network, and the International Consumer Protection and Enforcement Network.

This cooperation means that, for companies engaging in anti‑competitive activities, there are fewer and fewer places to hide and the likelihood of detection and prosecution are greater.

Within Canada, the Bureau collaborates with a number of regional partnerships including law enforcement partners such as the RCMP and government procurement agencies at the local, provincial and federal government levels in Western Canada and elsewhere.

Internationally, the Federal Trade Commission and Department of Justice in the United States, the European Commission, the Office of Fair Trading in the UK, and the Australian Consumer and Competition Commissioner are just some of our partners.

Considerable collaboration occurs between officers at our respective agencies, both on case specific issues where there are parallel investigations, and in terms of developing best practices. An example of this collaboration is our Merger branch's case handlers' participation in regular bilateral workshops with the Federal Trade Commission.

Going forward, we intend to expand on our relationships with our domestic and international partners and to leverage these relationships to deliver our mandate.

Collaboration

Now that I have clearly laid out that our plan to focus is on enhancing relationships, I must unequivocally say that we will do this without ceding an inch on our primary enforcement mandate.

Our commitment to enforcement runs deep in my veins, in fact, the Bureau's recent track record on enforcement, mirrors my own as an enforcer at the Bureau.

While our default position is to work collaboratively, we will not hesitate to litigate where necessary, because through litigation comes increased compliance and transparency as the courts interpret our law.

Maxzone

A recent example of that increased transparency through interpretation is Chief Justice Crampton's decision in the Maxzone case, wherein the company was charged for its participation in an international cartel that involved the sale of aftermarket auto-parts. Maxzone subsequently entered a guilty plea here, in Vancouver, in federal court, and agreed to pay a fine of $1.5 million.

It is a decision which I am certain many of you are aware, and I would like to take a moment to address it now.

This decision sent a strong message both to the judiciary and Canadians, that anti‑competitive activity is serious, harmful, criminal behaviour that is akin to fraud and theft and should be viewed and punished as such – including with prison sentences for individuals, in order to achieve the right amount of deterrence.

Beyond this, the decision strongly supported the Bureau's Leniency Program as a framework for developing sentencing recommendations and underscored the need for corporate compliance programs.

This decision is fundamentally important to us and to Canadians because it speaks to a sea-change in the way that white-collar crime is viewed.

That sea-change owes its genesis, in part, to the 2009 amendments to the Competition Act – which, by strengthening our enforcement capacity, sounded a warning bell that anti‑competitive behaviour would not be taken lightly.

And, despite the fact that some members of the bar have suggested that Chief Justice Crampton's decision could hinder or chill the Bureau's Leniency program, it is very interesting to note that since his decision, we have received a number of new applicants to the program who are represented by experienced competition counsel.

It is our view that Chief Justice Crampton's decision has hastened the race to be 'first in the door' to receive leniency.

Accordingly, the Bureau's Immunity and Leniency Program will remain our most important tools in detecting, investigating and prosecuting criminal cartel and bid-rigging offences under the Competition Act.

These tools support the Bureau in delivering on its enforcement mandate.

Our enforcement mandate

As you will know, we continue to be committed to enforcement excellence, and building our capacity as an agile and principled enforcement body.

And, we deliver on our commitment to enforcement excellence, through the strength of our people.

To that end, we will be welcoming some new faces from the outside to the Bureau in the coming months, in order to bolster our existing skill set.

We are building our litigation capacity, developing from within, to reduce the cost to the Bureau and to be prepared to fight in the courtroom where appropriate.

I am also pleased to announce that we are welcoming back Bill Miller as a Special Enforcement Advisor to the Commissioner's office, providing advice on all Bureau enforcement matters. He is a highly respected lawyer, in the anti-trust community, who has spent 25 years with the Department of Justice Canada. Bill will be a great asset to the Bureau.

Additionally, the seasoned Bureau veteran, Richard Taylor, has just been appointed as the TD MacDonald Chair. Richard started his career at the Bureau in 1983 and he brings extensive enforcement experience and a wealth of knowledge in competition policy, accompanied by a strong economics background to the TD Chair.

And, Richard will be working with the Bureau's Economic Policy and Enforcement Branch, on the area of strategic regulatory interventions.

In some circumstances, deregulation and the introduction of competitive forces within a market have just as much, if not more, impact on the economy as enforcement actions.

To that end, we will be looking at incrementally increasing our level of strategic regulatory interventions. We are currently working to identify the sectors for focus and may have more to report on this in the coming months.

We will approach this with the same transparency and openness that I have been referring to throughout my remarks today.

Conclusion

While I am not one to use many quotes in my remarks, I would like to share this famous quote with you.

Franklin Roosevelt is one of the most quoted orators in modern history – and his remarks continue to inspire and educate us today – but none so more as the advice he gave on public speaking.

He said: Be sincere; be brief; and be seated.

I hope I've been reasonably brief, but before I take President Roosevelt's sage advice and be seated, I'd like to note that I do sincerely believe the Bureau must build trust through an open dialogue with our partners, like the people in this room today.

On that note, I look forward to hearing from you about the state of Competition Law in Canada, and hope we can participate in a vigorous discussion. I will be happy to take your questions and listen to your comments.

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