Corporate pushback is building against Trudeau's plan for tougher competition law

The federal government is facing opposition to its plan to make Canada's competition rules harder.

The government tabled a number of amendments to the Competition Act that would dramatically raise penalties on companies that break the rules. In the wake of the Hero Pay scandal in 2020, which saw the top three grocery chains cancel $2-an-hour bonuses for their staff on the same day, MPs have been calling for wage- fixing to be made a criminal offence.

Policy experts, including the federal competition watchdog himself, have heaped criticism on Canada's competition rules in recent years. The government's proposed amendments, tucked into the annual budget bill in April, will offer better protections for consumers and workers at a time of runaway inflation. The government has no choice but to act.

Lawyers and think tanks don't want to cram legal reform into an omnibus bill. The changes have nothing to do with the nation's budget, so they shouldn't be in a bill. The C.D. Howe Institute accused the federal government of moving quickly on the issue.

The four Conservative MPs who sit on the industry committee wrote a letter asking the government to pull the amendments from the budget bill because of a lack of consultation.

There could be a chill on corporate investment in Canada. The monetary penalty for the first offence is $10 million and the second offence is $5 million. The fines are too low for a big market player. The government would like the penalty to be a sliding scale.

Penalties that are three times the value of the company's anti-competitive practices would be allowed by the government. The government will ask for three percent of the company's gross global revenues if that can't be calculated. That is a large number for multinational corporations.

Michael Kilby is a lawyer who heads up the competition and foreign investment group at Stikeman Elliott.

The Canadian Chamber of Commerce said the penalties were a leap from the status quo.

Mark Agnew, the chamber's senior vice president of policy, said that tying penalties to global revenues with no cap could cause harm to the Canadian economy.

Vass Bednar is one of the most outspoken advocates for competition reform.

I don't mean "the people" Bednar told the House of Commons industry committee that corporate interests have benefited from the policy inertia on competition. We don't need any more backroom baseball or reform being put on hold.

Industry Minister Franois-Philippe Champagne's office is framing the budget bill amendments as a first step, a few quick fixes that can be done now, to be followed by a larger review of the entire Competition Act.

Laurie Bouchard, a spokeswoman for Champagne, said in an email on June 8 that the amendments are a first step to modernizing the act.

The preliminary step is important for Bednar. She said last month that the amendments were a down payment on reform. Corporate interests can't delay them.

They are a test of Canada's commitment to competition reform. She said that they had not for a long time. Proposed changes are the lowest hanging fruit. They serve the public interest at a time when Canadians are under economic pressure.

The Competition Act amendments are likely to stay on the budget bill without significant changes, according to a Liberal MP.

He doesn't think the bill's opponents will succeed Vass is correct that it is important for the government to show its seriousness.

The email address is jedmiston@nationalpost.com.

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