The Competition Bureau hosted the Competition and Green Growth Summit on September 20, which explored the intersection between competition law and policy and sustainability. This full-day event featured an opening address from the Commissioner of Competition and three panels, shedding light on the Bureau's enforcement efforts and priorities in the green economy.
The Bureau's decision to host a full-day event focusing on the interplay between competition law and policy and environmental objectives indicates that sustainability - typically considered to be outside the scope of competition law policy - is an enforcement priority for the Bureau.
Highlights from the Competition and Green Growth Summit include:
- The Bureau does not intend to expand the goals of competition law and policy. Businesses can expect enforcement efforts to continue under the current legal framework.
- Competitor collaborations, merger reviews and abuse of dominance practices will be scrutinized by the Bureau for their effects on innovation. The Bureau will pay attention to environmental considerations when analyzing business conduct, such as when collaboration between businesses involves delivering goods or services in more sustainable ways.
- Misleading advertising related to the environmental qualities of products or services (known as "greenwashing") is an ongoing area for Bureau enforcement that includes working with its international counterparts.
Opening Address by Commissioner Boswell
Commissioner of Competition Matthew Boswell said in his opening remarks that the Bureau's role is to ensure that anticompetitive conduct does not get in the way of Canada's transition towards a greener economy.
The Commissioner identified three areas of intersection between competition law and policy and sustainability, which were supplemented by the panel discussions that followed:
- Consumer Confidence: As businesses meet consumer demands for green choices, falsely promoting "green" products is harmful to competition because it limits consumers from making informed decisions and prevents businesses from competing fairly. It was noted that greenwashing practices are on the rise.
- Anticompetitive Conduct: Conduct related to horizontal agreements, mergers, and monopolistic practices will be monitored for environmental considerations in addition to anticompetitive effects. For example, the Commissioner suggested that a merger of competing environmental companies could make their services more expensive and less innovative, resulting in harms to both the market and the environment. The Commissioner's remarks also suggested that the Bureau may view competitor collaborations as a legitimate means of delivering goods and services in more sustainable ways.
- Broader Regulatory Environment: In a message directed toward policymakers, the Commissioner expressed support for ensuring that environmental regulations promote, rather than hinder, competition.
A Green Future: Competition Policy and Competitiveness
The first panel kicked off the summit with a discussion of the role of competition in achieving the Canadian government's sustainability goals and enhancing Canada's global competitiveness.
Panelists underscored how regulatory certainty and regulatory burdens impact competition in Canada. For instance, panelists indicated that competition would improve if certain regulatory processes (such as approving construction permits) happened more quickly.
Panelists also discussed the private sector's role in promoting sustainability through competition for capital. It was noted that Canadian businesses are already adopting environmental, social and governance (ESG) targets in competing globally for access to capital. Equally, while the Bureau has not undertaken enforcement related to ESG reporting, businesses were advised to ensure that such reports are not offside the misleading and deceptive marketing provisions of the Competition Act.
Enforcers Roundtable: Perspective from Competition Agencies
This panel centered around the practical aspects of environmental considerations in competition enforcement across the globe. Panelists included representatives from the EU, UK and the US, who highlighted the efforts taken in their jurisdictions to adopt and integrate sustainability considerations.
A representative from the EU indicated that its updated horizontal cooperation guidelines incorporate several sustainability considerations and will be available early 2023. A representative from the UK emphasized that sustainability continues to be a key priority for the Competition and Markets Authority, which published guidance on environmental claims for businesses and published its advice to the UK government regarding sustainability and competition. Representatives from the US shared that the Department of Justice is likely to scrutinize transactions for their effects on innovation and discussed efforts undertaken by the Federal Trade Commission to address greenwashing, which includes periodic updates to its Green Guides intended to help marketers avoid misleading environmental claims.
The Bureau has yet to announce how it intends to integrate environmental considerations into its enforcement framework, but businesses can expect that the Bureau's approach would likely be consistent with its international counterparts.
Competition Enforcement in a Greener Economy
The summit concluded with a panel on the role of competition enforcement in the green economy of the future.
The panelists generally agreed that the Competition Act provides the necessary tools to address sustainability concerns and that the more pressing question is how the Bureau can appropriately incorporate environmental factors into its existing competition framework.
Some panelists were concerned that competition laws may have a chilling effect on competitor collaborations that help achieve environmental objectives, while others expressed concern that collaborations may instead stifle innovation. It remains to be seen how the Bureau will treat competitor collaborations that have sustainability benefits despite adversely affecting competition.
Efforts by the Bureau to promote consumer trust include leveraging its relationships with agencies in other jurisdictions to combat deceptive marketing practices through intelligence-gathering, as well as by relying on complaints submitted to the Bureau against businesses engaging in greenwashing practices.
Conclusion
The Competition and Green Growth Summit provided an important glimpse into how the Bureau views its role in Canada's shift towards a greener economy.
Businesses and practitioners are encouraged to monitor how the Bureau proceeds with integrating environmental sustainability considerations into its practices, which may include possible updates to its guidance documents and heightened scrutiny of environmental claims.
The author would like to acknowledge the support and assistance of Zach Rudge and Ren ée Taillieu, articling students at law.
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