Competition Bureau Weighs In on US Pricing in Canadian Stores
By Hervé St-Louis
February 19, 2009 - 21:38
To start with, subsections 74.01(2) and 74.01(3) of the Competition Act of Canada are usually applicable to case of false price advertising. For example, if a store claims that there is a 20% discount on an item, it must be able to prove this. Thus, no false discounts or sales can occur.
About American pricing, there are no particular provisions under the Competition Act of Canada making the usage of US pricing illegal, but at the same time, there are no provisions making it legal either. This is a grey area that would have to be tested in court if the Competition Bureau were to pursue such as case. The Competition Bureau will only pursue this case, if Canadians complain about it and depending on the availability of manpower. The query made by The Comic Book Bin to the Competition Bureau was not a complaint from a customer, but a media inquiry. Hence, it is recorded by the Competition Bureau and they are now well aware of the issue of US pricing in some Canadian comic book stores as of now, although they will adopt a wait and see attitude based on the public’s response.
A comparison was made by The Comic Book Bin about the reaction of Canadians, if say, large retailers like Walmart Canada or Loblaws were to put US prices on the goods within their stores. The representative from the Competition Bureau agreed that this would certainly lead to countrywide public outcry. I am of the opinion, that if a large Canadian retailer tried to pull such a stunt, the Industry Minister of Canada would intervene directly and swiftly to force the stores to change policy.
But in the comic book industry, a banana industry, it seems, the public is apathetic and henceforth so are consumer protection watchdogs and governments. The issue of US pricing is not something, as most readers can guess, that has been an issue in Canada for goods purchased within the country.
To be fair, not all Canadian comic book stores use US pricing. Some visited recently take great care to announce the price in Canadian dollars, even when using Diamond Comics’ POS system. However, some use practices the nice folks from the Competition Bureau had no choice but to agree were illegal. For example, some stores add the exchange rate difference on a bill as a tax – an exchange rate tax. Now, there is no such tax in Canada, and of course, the labelling of a charge as a tax is the exclusive privilege of governments. However, in this case, it’s not up to the Competition Bureau to take action, but Revenue Canada.
About the issue of US pricing, just because the Competition Bureau has no direct statutes that deal with this issue, and because no business has been tried under such accusation, thus creating jurisprudence, it doesn’t mean that it is legal. For example, consumer protection laws are a competency of Canadian provinces. It’s quite possible that most provinces have specific rules against the use of US prices in their jurisdictions or could interpret their existing laws as covering such consumer abuses.
In fact, all of this issue is a matter of interpretation and the courts. As the media outlet that instigated this story, the staff of The Comic Book Bin is ill-placed to lodge complaints. I won’t lodge any, as my job is to investigate stories, report to readers, not being the principal instigator of news. I won’t lodge a complaint, but I will surely continue to follow developments in this story.
Diamond Comics POS System May Be Illegal In Canada