Running head: BALANCE IN THE CANADIAN MARKET REGULATIONS 1

Balance in the Canadian Market Regulations

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BALANCE IN THE CANADIAN MARKET REGULATIONS 2
Balance in the Canadian Market Regulations

Introduction

The Canadian economy is a free market wrought with international exposure, innovation

and invention, trading regulations, and favorable competition. However, the hegemony

practiced by monopolies tends to attract the competition bureau to impose policies that facilitate

the striking of a balance between the trading practices of these businesses and the consumer

rights at stake in the market. The policies do not bear upon the market practices to withdraw

free trade, and neither do they guarantee unwarranted consumer liberties. This has consequently

created a reasonable balance in the regulation of the Canadian economy. The significance of the

competition bureau in Canada is highlighted by the quantum leaps it has made in protecting

consumers from deceptive markets and generating fair and effective markets through

competition policies that constantly reform the markets based on trends, demography, and

consumer feedback.

The Competition Bureau

The Canadian federal government has undertaken an uphill task over the years to institute

policies that regulate growing markets and curb trading practices that rely on extortion,

racketeering, and deception in boosting returns. These approaches have been executed by the

competition bureau, an agency within the Canadian federal government that imposes laws

relating to marketing, competition, and consumerism (Boyer et al., 2017). The Competition

Bureau was established as part of the Innovation, Science and Economic Development in

Canada. The functions of the competition bureau within the international landscape echo the

balance that has been achieved within the Canadian economy, which is reflected in the

increased immigration of traders and businesses to Canada.

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The competition bureau enforces laws or statues that have been ratified by the federal

government, which relates to trade. These include the Competition Act, the Textile Labelling

Act, Precious Metals Marking Act, and Consumer Packaging and Labelling Act (Canada, 2014).

The bureau launches investigations based on consumer complaints and market upheavals, then

challenges the practices in the competition tribunal or take the issue to the public prosecution

service of Canada who prosecutes criminal cases (Goldman & Joneia, 2019). This function of

the bureau allows it to castigate market changes, monitor competition, and evaluate the need to

impose protectionism in the market against aggressive trade practices. This overall effect of the

bureau is the striking balance in business practices and consumer interests.

The Competition Act

This Act of 1985 was implemented to help regulate commerce concerning competitive

practices and conspiracies, which would otherwise have created market imbalance resulting in

unhealthy business environments for low-income traders (Boyer et al., 2017). On the other

hand, the Act also recognizes the consumer rights that are likely to be affected by harmful

trading practices. Therefore, the effective application of this Act creates a balance in the

economy. In the Regulations Respecting Anti-Competitive Acts of Persons Operating a

Domestic Service (SOR/2000-324), the Act criminalizes the Act of altering schedules and

networks to establish competitive hegemony (MordenJ, 2016). This unprecedented practice

affects the customers of these services and thereby affecting the market. The delays prompted

by the competitive strategies imposed by oligarchies and monopolies reflect in the stranded

businesses and lack of products and services to the end-user. These are insensitive private

trading practices that have consequent effects on traders and consumers' free trade.
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The Competition Bureau imposes competition laws and consumer protectionism whose

objectives include optimizing consumer interest within the market. However, there are instances

the balancing of the economy depends on promoting trading practices, which affects the

consumers but ultimately improves the market (Goldman & Joneia, 2019). In 2013, the hiking

of the propane prices during winter was supported by the competition bureau, which argues that

the short term hiking prices would prevent hoarding of the product and result in increased

market supplies (MordenJ, 2016). This restrictive price regulation on the propane businesses,

while on the other hand, it resulted in propane flooding the market for customers to use in

heating systems. The balancing effect was logically viable as it promoted the propane business

while also availing products to the customers, without infringing on their rights.

Deceptive Marketing

Marketing is introducing products and services to consumers intending to attract them to

purchase. Deceptive marketing is, therefore, using dubious means of attracting customers to

make purchases of products. This violates the freedom of consumers and results in the sale of

low quality or harmful products. Deceptive marketing has been prevalent under COVID 19,

whereby traders are introducing chemical products into the market and claiming they can cure

or prevent the virus. The potential damage from this illegal and insensitive trade is the harmful

effects that will probably result in hospital congestion (Goldman & Joneia, 2019). The

competition bureau actively evaluates products and marketplaces to stem the deceptive

marketing angles that provide wrong impressions and result in physical and financial

infringement of consumer rights.

Deceptive marketing creates an imbalance in the marketplace as flourishing businesses

curtail customers` rights. Under the Competition Act, it is a criminal offense to provide
BALANCE IN THE CANADIAN MARKET REGULATIONS 5
deceptive representations, telemarketing, pyramid selling, and double-ticketing (Gudofsky et

al., 2010). Additionally, Act also makes it illegal to use false testimonials or inflated advertising

prices. Coupled with the Competition Act, the Competition Bureau contributes to a flourishing

economy that is balanced for competitors and is favorable and sufficient to the needs of the

consumers.

Price Fixing

The market is often plagued by seasons of the boom to bust and vice versa that compel the

traders to alter prices to retain profits. These actions are at times permitted by the competition

bureau, such as in the propane case of 2013 (MordenJ, 2016). However, oligopolists usually set

their prices due to their hegemony in their specific industry, such as oil or gas. The trend in a

single oligopoly industry permeates the other industries and result in hiking prices of products

and services as these oligopolists compete for sales and market share. Longitudinal studies

indicate that oligopolists create a high market concentration of huge profits from the

suppression of buyers through price-fixing. In the need to create balance in the economy, the

federal government of Canada, through the competition bureau, employs tools such as merger

control laws, the prohibition of cartels in the market, and stringent regulation on joint

dominance abuses (Gudofsky et al., 2010). The impact of the collective dominance often

downplays the significance of other plays in the market, thus causing chaotic pricing and

methods to outdo rivals, which ultimately results in customer boycotting services or suing over

rights infringement (Canada, 2014). In this case, the competition bureau acts as the advocate

against the overt collusion of traders who explicitly fix prices and therefore create market

imbalance.

Bid-Rigging
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Bid-rigging is a practice that allows the huge suppliers in the market to collude in the

tendering business and help eliminate competition through the withdrawal of bids or failure to

submit a bid. This Act orchestrated through business deals often eliminates smaller suppliers

and results in high pricing and unhealthy competition (Boyer et al., 2017). This affects both the

market and consumers, thus imbalance in the market. This practice can occur in government

projects such as infrastructure development or the private sector, such as warehousing. The

costs and harmful practices derail the market off its benefits, thus affecting the economy

significantly. The competition bureau employs the Competition Act section 47, which

criminalizes bid-rigging as a cartel practice (Goldman & Joneia, 2019). Bid-rigging is detected

where there are few bidders in a market where competitors' bids are received similarly, or a

similar bidder is winning irrespective of the competition present. To create balance in the

economy, the competition bureau imposes rules on the tendering process that includes

disclosure of particulars of potential bidders and treatment of all suppliers equally (Gudofsky et

al., 2010). The penalties include huge fines and imprisonment of up to fourteen years. These

measures help prevent hiking prices that affect customers and bidding practices that eliminate

potential competition in the marketplace.

The competition bureau regulates the Canadian economy based on the frequency in which

consumer welfare is threatened, and the instability of the market is on the rise (Boyer et al.,

2017). The bureau checks on market trends. Technology has created loopholes that allow traders

to employ deceptive marketing methods and pricing tactics in the current age. On the other

hand, the bureau has blended into the technological landscape through oversight operations, and

that helps track and monitor business activities concerning customer welfare (Canada, 2014).
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This helps to create a reasonable balance on the competing interest of businesses and consumer

rights.

Conclusion

The pervasive nature of illegal business incentives attracts suppliers and firms to invest in

deceptive functions that satisfy their market needs at the expense of other traders and

customers. Through the competition bureau, the Canadian federal government tries to

encourage measured competition that upholds the customers` welfare while constraining

predatory strategies. The bureau balances these markets through enforcing federal laws against

price inflation, bid-rigging, and deceptive advertising. The cause-effect relationship of buyers

and suppliers is also regulated through the Competition Act, which stipulates guidelines against

the oligarchies' exclusionary competitive habits and monopolies in the market. Lucidly, the

competition bureau's optimal regulation implies the reasonable balance achieved by the federal

government in bridging consumer welfare and market growth.

References
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Boyer, M., Ross, T. W., & Winter, R. A. (2017). The rise of economics in competition policy:

A Canadian perspective. Canadian Journal of Economics/Revue canadienne

d'économique, 50(5), 1489-1524.

Canada. Competition Bureau issuing body. (2014). The Competition Bureau. Competition

Bureau Canada = Bureau de la concurrence Canada.

Gudofsky, J., Kriaris, E. L., & Vital, L. (2010, September). Abuse of Joint Dominance: Is the

Cure Worse than the Disease? In the Canadian Bar Association. Annual Competition Law

Conference/Toronto.

Goldman, C. S., & Joneja, N. (2009). The Institutional Design of Canadian Competition

Law: The Evolving Role of the Commissioner. Loy. U. Chi. LJ, 41, 535.

MordenJ. (2016). Highlights from the Competition Bureau’s workshop on emerging

competition issues. In Highlights from the Competition Bureau’s workshop on emerging

competition issues. Competition Bureau. https://sfu-primo.hosted.exlibrisgroup.com/primo-

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