Opening Remarks by Sheridan Scott Commissioner of Competition for the Commissioner’s International Panel

The Canadian Bar Association’s 2005 Annual Fall Conference on Competition Law

Hilton Lac Leamy Conference Centre

November 3rd, 2005

(PDF:22KB)

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Introduction 

Thank you. I am extremely pleased this afternoon to be your moderator for our distinguished international panel.

I have asked our guests to focus their remarks on advocacy, addressing the topic I like to call “Viewing Legislation Through a Competition Lens.” The role of the Competition Bureau as well as other competition authorities as advocates for competition in our respective countries is well recognized.  However, when it comes to carrying out this role in relation to legislative initiatives, we at the Bureau are faced with challenges that range from merely finding out about legislation of concern to communicating our views early enough in the process to have an impact. This subject is gaining momentum in a number of jurisdictions, each of which has adopted its own distinct approach. However, competition authorities are not typically structured or staffed to conduct competition analyses of all legislative proposals from conception to implementation with a view to identifying potential competition issues and ensuring that these issues are adequately assessed and considered throughout the process.

Speaking on the subject last June in Bonn, Competition Commissioner Neelie Kroes gave her take on the European Commission’s role in this regard:

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Our aim is to improve the quality of regulation and make it as competition friendly as possible... Many different types of legislation may have an impact on competition. These include liberalisation measures, industrial policy measures and internal market legislation, as well as consumer protection rules and intellectual property rights.  Of course, these measures pursue their own legitimate policy objectives... We just want to make sure that competition principles are part of the balancing act... The aim is to ensure that the policy options retained are those which are as favourable as possible to the structure and parameters of competitive markets, whilst achieving the primary policy objectives necessary in whichever policy field concerned.  In short, our approach to EU policy-making should mean that there are no surprises, no unexpected or underestimated side-effects on competition.

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In my view, looking at government policies through a competition lens includes finding ways to ensure that competition is in fact given its due throughout the course of the legislative development process as:

• a driver of innovative and internationally competitive businesses; 
• a means to reduce barriers for small and medium sized businesses; and finally,
• a way to provide consumers with innovative products and services, choice, lower prices and the quality benefits that competition delivers.  

The benefits of applying a competition lens to government policies are being increasingly recognized internationally. As an example, in 1995, the Australian government established a National Competition Policy under which all existing and proposed legislation is being reviewed from the perspective of removing unwarranted or unnecessary restrictions on competition. The Australian Productivity Commission has conservatively estimated that pro-competitive measures continued or adopted under the National Competition Policy have increased the country’s gross domestic product by 2.5%, with further gains expected.

In the UK, evidence of the benefits of competition for competitiveness and productivity, as well as consumer welfare, led the country to incorporate competition analysis directly into its legislative development framework. Since 2002, legislative proposals have had to identify and assess potential competition concerns or benefits, and the process appears to be working well —– and efficiently.

Lastly, as mentioned earlier, the EU also considers competition to be a key driver of productivity and growth. The EU Commission Impact Assessment Guidelines introduced in June 2002 explicitly include competition among the factors to be considered in all major EU legislative and policy proposals and provide a framework for related competition analysis.

I’m delighted that today’s panellists have agreed to outline and critically assess how they promote competition as a bedrock principle guiding the economic policies of their jurisdictions, including through the development of legislation. I’m looking forward to hearing about the impact of their advocacy efforts. In the public sector in Canada today, we must find a way to measure our performance to demonstrate the tangible benefits of our efforts to taxpayers.

But, before I introduce our first panellist, I’d just like to add that, this morning, it was my privilege to host the first ever formal trilateral meeting of the heads of the Canadian, American and Mexican competition authorities during which we discussed this subject, among others. We also discussed another important driver of productivity and competitiveness in our respective economies, innovation, in the context of the interface between competition policy and intellectual property. It is my view that the links between competition and innovation need to be better examined. In furtherance of this goal, at the meetings of the OECD’s Competition Committee last month, we proposed, and our OECD colleagues agreed, to address this topic during an upcoming roundtable discussion. Of course, part of this discussion will address our respective approaches to the treatment of dynamic efficiencies to which I have already referred during my luncheon address.

Several other Canadian-led initiatives will also be addressed during future roundtables at the OECD, including a look at the way different jurisdictions conduct market studies and post-merger evaluations, while Working Party 2 on Competition and Regulation will also examine regulatory impact assessments.  

Now, I’m pleased to introduce the first of the participants for this afternoon’s panel.