The Commissioner of Competition Outlines his Agenda 


December 2012

Competition Bulletin

In a significant speech, delivered in the Vancouver offices of McMillan on December 5, 2012, John Pecman, Canada's Interim Commissioner of Competition (the "Commissioner"), outlined the enforcement agenda for his term.

The Commissioner, an economist by training, has had a long and distinguished career with the Competition Bureau. He most recently served as a Senior Deputy Commissioner for criminal matters, dealing primarily with cartel cases. Over his career has worked also in the mergers, consumer protection and reviewable conduct branches of the Bureau.

Commissioner Pecman's speech, delivered on the occasion of a meeting of the Vancouver Competition Policy Roundtable, can be viewed here. The Commissioner identified three principal priorities for the Bureau in his prepared comments:

  1. Focused enforcement based on strategic cases and regulatory interventions.

  2. Transparency and predictability in enforcement.

  3. Developing the trust of the bar and other stakeholders through enhanced collaboration.

After his speech, the Commissioner opened the floor to questions for him, Matthew Boswell (A/Senior Deputy Commissioner, Criminal Matters Branch), Jeanne Pratt (A/Associate Deputy Commissioner, Criminal Matters Branch) and Victor Hammill (Assistant Deputy Commissioner, Pacific Region). What follows is an attempt to capture the most significant aspects of the Commissioner's presentation.

With regard to focused enforcement, the Commissioner indicated the Bureau's resources are not unlimited. That said, it will not hesitate to take important and appropriate cases. He indicated that priorities will be established on the basis of whether there is a repeat offender involved, whether the conduct is particularly egregious, whether there is an important point of law to be determined, and whether the conduct has significant consumer impact. The Commissioner indicated that he regards competition in telecom, amongst other industries, to be very competitively important.

The Commissioner reaffirmed the Bureau's enforcement or compliance continuum, noting that formal court action is not always or usually the first step. Outside hardcore cartel conduct, matters typically start with a warning letter and then escalate, depending on the response of the party under investigation. That said, the Bureau is concerned to ensure that there is adequate deterrence of unlawful conduct and is continuing to increase its in-house litigation capacity. He noted, specifically with respect to cartel enforcement, that the Bureau will bring appropriate cases involving indirect as well as direct purchasers in Canada.

The Commissioner indicated that the Bureau continues to be open to working with the Bar and other relevant stakeholders, including business groups, law enforcement agencies and federal, provincial and municipal procurement bodies to improve and clarify its procedures, including those with respect to such matters as document discovery and leniency programs. Indeed, the Bureau is looking to expand its relationships with stakeholders, both in Canada and internationally.

The Commissioner also indicated that the Bureau will become more active than it has been in the recent past with respect to its advocacy role, and in particular formal and informal interventions before appropriate federal and provincial tribunals and regulatory bodies to advance the importance of competition. Areas of particular focus are currently being reviewed by the Bureau, but are likely to include health care, pharmaceuticals, and transportation.

With respect to the recent decision of Chief Justice Crampton1 as to appropriate sentences in cartel matters, the Commissioner noted that the Bureau welcomes the Chief Justice's statement that cartel matters are serious – akin to fraud and theft. On the other hand, the Chief Justice's suggestion that the courts may be less willing than in the past to accept joint recommendations for sentences in the case of guilty pleas may result in challenges for the Bureau's leniency program. That said, the Commissioner noted that leniency applications have increased since the release of that judgement, and that the immunity and leniency programs continue to be the Bureau's single most effective and important enforcement tool. The Commissioner also reiterated the Bureau's position to seek jail sentences in price fixing cases, and not surprisingly, those most at risk will have had direct involvement in the cartel activity.

With respect to abuse of dominance, and the recently released enforcement guidelines with respect to the abuse of dominance provisions, the Commissioner advised that while those guidelines are in place and will not be changed in the short term, he would like to develop, in cooperation with stakeholders, including the Bar, a series of frequently asked questions and hypothetical scenarios related to abuse of dominance.

The Commissioner indicated that, with respect to misleading advertising enforcement, we may expect to see more criminal enforcement with respect to "bread and butter" type misleading advertising, which had been a staple of the Bureau's work in the past.

Finally, the Commissioner stated that the Bureau is likely to update its Immunity and Leniency programs, to issue Guidelines on price maintenance and to provide guidance on its investigative procedures and on electronic document production over the next few months.

1 R v Maxzone Auto Parts (Canada) Corp. (3 May 2012), Vancouver T-798-12 (Federal Court).

This speech, and the Commissioner's surrounding comments, provide a bit of a roadmap as to where the Competition Bureau may be expected to focus its efforts over the next year or so. The message seems to be continued aggressive enforcement, but with some balance to allow for other important activities undertaken by the Bureau.