Last week, former Commissioner of Competition and Fasken Senior Business Advisor John Pecman published a highly topical article in the Financial Post outlining why knee-jerk antitrust reform may worsen inflation. Yesterday morning, the Minister of Innovation, Science and Economic Development Canada, Francois-Philippe Champagne, announced that the Government of Canada will engage in a broad review of the Competition Act (the “Act”) with a view to promoting dynamic and fair markets. This announcement comes in response to growing calls for reform to Canada’s competition laws to account for the market power of large companies, particularly in the digital space. Reform proposals range from practical and constructive, to bold and potentially harmful.
In his article in the Financial Post, John explains that many of the proposed reform proposals would bring back outdated views about big business and may well result in reduced economic efficiency and harm to consumers. Further, he discusses why one particular reform proposal would be inadvisable – a ban on self-preferencing. John explains that a ban on self-preferencing either generally, or specifically by large digital platforms, may cause less competition, less innovation, and higher prices. He notes that the Act already permits competition regulators to challenge and stop practices such as self-preferencing by entities with market power if they are likely to result in a substantial lessening or prevention of competition. Until the current laws are shown to be inadequate, John suggests it is premature to seek legislative changes.