OTTAWA (Reuters) - The Canadian government introduced legislation on Tuesday to give the country’s competition watchdog the power to embarrass companies that charge more for products in Canada than they do in the United States.
The Conservative government’s proposed Price Transparency Act would fall short of making it illegal to engage in price discrimination. Doing so had been roundly criticized by economists as undue interference in the marketplace. 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 at a Toys R Us store in Toronto.
He decried what he called “price gouging of Canadian consumers ... simply because of where they live.”
The bill would allow the Competition Bureau to seek court orders forcing companies to hand over confidential information that could expose pricing practices not justified by higher costs in Canada. The bureau would then report its findings to the public.
“It’s the corporate equivalent of the government coming into our bedrooms,” said Benjamin Dachis, senior policy analyst at C.D. Howe Institute.
The government had promised in its February budget to empower the bureau to address unjustified price discrimination, part of a broader pro-consumer agenda it has been pursuing as it heads into an election next year.
Some commentators predicted the move would be ineffective in lowering prices.
Consumer outcry over the U.S.-Canada price gap for consumer goods picked up when the Canadian dollar rose to parity with the greenback, leading shoppers to expect prices to become roughly equal on both sides of the border. The Canadian currency has since fallen back.
Some businesses have argued that their operating costs are higher in Canada, justifying higher prices.
Additional reporting by Allison Martell in Toronto; Editing by Jeffrey Hodgson, W Simon and Peter Galloway