UPDATE 2-Canadian bill to expose U.S.-Canada price inequities

Tue Dec 9, 2014 1:49pm EST
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(Adds industry reaction, quotes from analyst and economist, background)

By Leah Schnurr

OTTAWA Dec 9 (Reuters) - The Canadian government introduced legislation on Tuesday to give the competition watchdog the power to embarrass companies that charge more for products in Canada than they do in the United States.

The ruling Conservatives had pledged earlier this year to address price discrimination as part of a pro-consumer agenda ahead of next year's election.

But the proposed Price Transparency Act would fall short of making price discrimination illegal, an idea economists had criticized as undue interference. Instead, the bill provides a mechanism to expose price differences.

"This legislation will not set or regulate prices in Canada," Industry Minister James Moore said.

He decried what he called "price gouging of Canadian consumers ... simply because of where they live."

Consumer outcry over prices picked up when the Canadian dollar rose back to parity with the greenback in 2010, leading shoppers to expect roughly equal prices. The currency has since fallen back, reducing price differences.

"I would roughly estimate that the gap is almost gone at today's exchange rate, so I almost wonder how many instances they're actually going to be dealing with in the next few years," said BMO Capital Markets chief economist Doug Porter.   Continued...