Letters from CAMP

Letters: Canada Gets Real on Competition

June 23, 2024

Welcome to Letters from CAMP, a newsletter on anti-monopoly activity in Canada and abroad, brought to you by the Canadian Anti-Monopoly Project. In this installment we have:

  • Bold competition reform becomes law with the passage of Bill C-59
  • Commissioner Boswell says competition is the key to productivity woes
  • FTC and DOJ focus efforts on Adobe’s deceptive subscription practices

Let’s dive in.

Bill C-59 Marks Canada’s Ambitious Competition Reform

In welcome news ahead of Parliament’s summer break, Canada’s competition landscape has been dramatically reshaped with the passage of Bill C-59, signalling the end of Canada’s pro-consolidation era and the setting the foundation for a fair economy. The legislation, which received royal assent on June 20, 2024, introduces sweeping reforms to the Competition Act, including new merger review safeguards, the ability for individual companies to fight back against monopolists, and closing the loophole that left Canadians on the hook for $13 million of telecom giant Rogers’ legal bills.

It goes without saying that CAMP is thrilled to see these long-overdue reforms become reality. “The passage of C-59 is an extremely welcome development and the culmination of years of effort to improve competition in Canada,” said Keldon Bester, Executive Director of CAMP, in a statement. “The reforms in C-59 are the best defense against further consolidation at the expense of Canadians and a strong message that fair competition is the way forward for our economy.” We at CAMP are particularly encouraged by the cross-partisan support for these changes, demonstrating a shared understanding of the need to protect Canadians from the negative effects of undue corporate concentration.

While a necessary steps, strong laws are only the first step towards a fairer economy in Canada. Echoing CAMP testimony to the House Standing Committee on Industry and Technology, laws are only as good as their enforcement, and the Competition Bureau must be ready to accept the responsibility of a larger role in Canadian economic policy. Long held back by laws designed by the businesses it was intended to police, the Competition Bureau must now chart a more assertive and transparent course as Canada’s competition cop.

Commissioner Boswell: Competition is the Way Forward on Productivity

This week, Matthew Boswell, Commissioner of Competition, argued in the Globe and Mail that increased competition is the key to unlocking productivity growth and improving living standards. To make his claim, the Commissioner points to evidence showing competitive markets drive innovation, investment, and economic performance. Adding to a chorus that includes institutions like the Bank of Canada, the Commissioner’s call lands as Canadian policymakers consider paths forward from our post-pandemic inflection point.

To reverse Canada’s productivity crisis, Boswell proposes three main ideas: reviewing existing regulations through a competition lens, setting clear and ambitious targets for change, and investing in institutions and research to support competition-focused initiatives. These steps could lead to significant economic gains, potentially increasing GDP by 2.5% or more, as seen in Australia.

While Boswell correctly takes a broader view of Canada’s economic policy, we cannot lose sight of the role of enhanced enforcement of the Competition Act in reversing Canada’s slide into monopoly. Canadians have entrusted the Competition Bureau with the improved toolkit the enforcer has pushed for, and it is now incumbent on the bureau to reward consumers, workers and entrepreneurs for that trust.

FTC and DOJ Go After Adobe’s Subscription Hoops

The Federal Trade Commission (FTC) and Department of Justice (DOJ) have launched legal action against Adobe Inc. and two of its executives for alleged deceptive practices related to subscription cancellations and hidden fees. The move comes at a time when Adobe is already under fire for its maximalist approach to the use of creative’s content for AI training, building on a long history of squeezing the creative community for access to its tools.

The complaint alleges that Adobe deceived consumers by inadequately disclosing costly early termination fees associated with their “annual paid monthly” (APM) subscription plan and by making the cancellation process unnecessarily complicated. This fee, amounting to 50% of the remaining monthly payments if canceled within the first year, is often only discovered by consumers when attempting to cancel their subscription.

Consumers attempting to cancel their Adobe subscriptions have also reported numerous obstacles, including navigating multiple web pages, re-entering passwords, and being forced to engage with retention offers before cancellation. Rather than build services that provide value to customers, Adobe seems content to engage in the classic monopolist practice of testing the patience and stamina of users trying to exit their walled gardens. The Adobe case is a signal to companies that rather than perfecting dark patterns, companies should focus on competing for users’ hard earned money.

If you have any monopoly tips or stories you’d like to share, drop us a line at hello@antimonopoly.ca

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