The Hard Choices Facing Canada’s Next Competition Commissioner
Canada is about to make a quiet decision with loud economic consequences. With the previous Competition Commissioner gone and an interim now in place, Ottawa is choosing the official who will decide whether Canadian competition policy is used to discipline genuine abuses or to make big business and scale itself suspect.
The next Commissioner will not determine Canada's economic future alone. But in an economy already marked by weak productivity growth, sluggish business investment, and stalling living standards, enforcement choices matter more than many realize, particularly in their treatment of scale and competitive conduct.
What Canada needs now is not simply a tougher or a weaker enforcer. It needs someone with sound economic judgment and the discipline to apply it.
Take the Rogers-Shaw merger. The Bureau fought it, but Rogers ultimately received approval with conditions. Critics said it didn't go far enough. Others said blocking it would have put billions in network investment at risk. That tension between preventing consolidation today and enabling investment tomorrow is what the next Commissioner will face repeatedly.
For mergers, the test is straightforward: do they leave consumers worse off through higher prices, lower quality, or weaker innovation? Competition law should not punish firms for getting big by competing better. It should punish firms that use their position to block rivals or harm consumers.
Concentration can be a reason to investigate, although less than most think. But it cannot be the conclusion on its own. Canada is a vast country with a relatively small population, and many industries require scale to support heavy upfront investment. In airlines, telecommunications, banking, or grocery retail, there will likely never be dozens of viable players. Serving Yellowknife and St. John's alongside Toronto requires scale that only a handful of airlines and grocery chains can sustain. Those economics naturally limit the number of firms that can compete effectively.
In competitive markets, some firms lose. That is not a policy failure; it is the point. Firms cut prices, improve products, and invest to pull ahead. That pressure can squeeze competitors, and it should.
The real task for the next Commissioner is to tell the difference between companies that grow by competing better and companies that grow by blocking others. One strengthens the market, while the other weakens it.
Drawing that line requires more than legal expertise. It requires a focus on growth and innovation as well.
The stakes are especially high where Canadian firms compete internationally. When regulators weaken a domestic player without clear consumer benefit, market power doesn't disappear; it relocates. Breaking up a Canadian firm competing against American or European giants doesn’t make the market more competitive. It simply hands those incumbents a smaller opponent. Consumers end up in the same oligopoly, just one where the dominant players are headquartered elsewhere.
And a concentrated market is not necessarily a broken one. A sector may look concentrated today and still be dynamic. The real question is whether firms are investing, adopting new technologies, and displacing one another over time through creative destruction, not just trading market share.
For example, blocking mergers or breaking up firms may alter market structures and make them more “competitive.” But it can also dampen investment in ways that far outweigh any immediate benefits. Given that Canada’s central economic challenge is productivity, those trade-offs cannot be ignored.
None of this calls for weaker enforcement. Collusion should be prosecuted forcefully. Companies that abuse their position to squeeze consumers or harm competition should face consequences. Independence from political pressure, domestic or foreign, is essential, but so is discipline in how that independence is exercised.
Competition law is one instrument in a broader economic toolbox. It can discipline misconduct, but it cannot build large firms, mobilize capital, or substitute for a national economic strategy to drive growth and global competitiveness.
Stretch competition law beyond its remit and you get unpredictability—and that unpredictability has costs. Businesses delay investment, firms reconsider expansion plans, and capital looks for more stable environments. Yes, enforcement can and should reduce profits where firms abuse their position. But when it starts to broadly constrain returns, it doesn’t just curb excess, it deters future investment.
The next Commissioner should adhere to three guiding principles: go after real consumer harm, not size; target specific abuses, not entire industries; and ensure that growth through innovation is not penalized.
Canada needs competition policy that protects consumers without treating scale, investment, or ambition as suspect. At a time when Canada badly needs firms that can grow, invest, and compete globally, the next Commissioner will help decide whether they are allowed to get big by competing, or punished for trying.
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July 15, 2024
