There’s a significant battle brewing over the direction of Canada, and a humble can of peas is at the tip of it.
Earlier this summer, the Competition Bureau announced it was challenging an attempt by Quebec-based food processor Nortera to acquire canned and frozen vegetable brands Green Giant and Le Sieur from New Jersey-based B&G Foods.
The competition watchdog said the deal was a merger to monopoly that would give Nortera 90 per cent of the canned vegetable market and 80 per cent in frozen, which would lead to higher prices for consumers. The company said the deal was necessary to protect its business and Canada’s food safety against cheaper imports.
As reported here, Nortera managed to convince the federal government of that argument, leading to tariffs being placed on imports and a review of the market by the Canadian International Trade Tribunal. That body last month ruled that imports were indeed harming domestic processors, and that tariffs were justified.
Though Nortera and B&G abandoned their deal earlier this month, the case highlighted the differing priorities – and the growing conflict – between the Competition Bureau and the federal government.
On the one hand, the Bureau is applying new powers and funding that took years to acquire in protecting markets and consumers from abuses of dominance. On the other hand, the government is fighting a trade war and backing transactions that solidify sovereignty.
Former competition commissioner John Pecman – now an advisor at Fasken’s law firm – is among those who has recognized this growing disconnect in consumer and industrial policies.
In a new piece for the C.D. Howe Institute, he says the conflict isn’t necessary and that Canada will be better served by closer co-ordination between the government and the Competition Bureau.
Pecman joins the Do Not Pass Go podcast to discuss how this could work, including the introduction of a mechanism that would allow cabinet ministers to veto merger challenges by the watchdog when it comes to sectors designated as nationally sensitive.
Read his intelligence memo here.
