Assessing the Canadian Law and Practice on Predatory Pricing, Price Discrimination and Price Maintenance

Anticompetitive pricing practices have received a significant amount of attention during the past several years but the criminal provisions of the Competition Act addressing predatory pricing, price discrimination and price maintenance (the "Pricing Provisions") are seldom the subject of enforcement actions by the Competition Bureau. This article examines the economic theory underlying competition policy concerns regarding each of these three types of behaviour and discusses the relevant provisions of the Competition Act the Bureau's approach to enforcement and its enforcement record. Based on this analysis, concerns may be identified at several levels. In some respects, the Pricing Provisions do not operate in a manner consistent with what economic theory would prescribe. Also, the Bureau's interpretation and enforcement of the Pricing Provisions are not always consistent with the provisions themselves or economic theory. Amendment of the Pricing Provisions could address some of these concerns. It may be preferable, however, to rely on the existing abuse of dominance provision, which could address these forms of anticompetitive pricing in a manner which is consistent with economic theory, sensitive to the particular characteristics of specific industries and responsive to the challenges of applying competition law to the increasingly important industries of the new economy