OTTAWA – If farmers or other food industry players believe they have evidence of collusion or price-fixing in their industry, they should contact federal government competition watchdogs, a federal official said last week.
But Don Mercer, deputy director of investigation and research in the criminal matters branch of competition act administration, warned that simple evidence of price increases or price matching will not be enough.
“There must be evidence of price-fixing or of collusion,” he told MPs during an appearance before the Commons agriculture committee studying the reasons for rising farm input costs.
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He said the Industry Canada bureau of competition policy is preparing brochures to be distributed which will instruct citizens on how to lodge a complaint and what evidence is required to get a case going.
Few agricultural complaints
However, despite what seems like an endless political debate in the farm community about the cost of farm inputs – including fuel, fertilizer and chemical costs hikes this year which led to the Commons hearings – Mercer said there have been few agricultural complaints.
MPs tried unsuccessfully to elicit comment on some practices they think are questionable.
Bloc QuŽbecois MP Jean-Guy ChrŽtien said in his Frontenac riding south of Quebec City, it is well known that auctions are fixed in agreements between auctioneers and buyers to keep cattle prices low.
“There is conspiracy,” he said. “There is collusion.”
Mercer said he would need evidence. “I would encourage you to put one of those people in touch with us.”
Then Alberta Reform MP Leon Benoit tried.
He said fertilizer companies have rules which prohibit farmers from buying cheaper fertilizer where they can get it. Is that not anti-competitive? he asked.
“I have to be very careful in my response,” replied Mercer. “I don’t have all the facts before me.”
When the issue of gasoline and fuel pricing was raised, ChrŽtien again insisted there was collusion between fuel dealers to keep prices high in certain regions.
Mercer said there is “conscious parallelism”, which means fuel dealers match prices set by their competitors, but that did not always mean price-fixing.
Evidence needed for conviction
He said for a conviction, there must be evidence of a secret agreement beforehand to set prices.
Later, public affairs officials from the Canadian Petroleum Products Institute appeared before MPs to defend industry pricing practices.
Brendan Hawley and Bob Clapp said the fuel business is a low-profit venture and pricing is influenced by tax levels, transportation costs and local competitive factors.
