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BILATERAL DISTANCING: THE TRUDEAU-TRUMP COVID-19 DIVIDE By Jeremy Kinsman (Article)

 Jeremy Kinsman

Jeremy Kinsman
March 26, 2020

The M.V. Coho arrives in Victoria’s Inner Harbour on its afternoon run from Port Angeles, Washington, 20 miles across the Juan de Fuca Strait, delivering, among others, the last snowbirds from the California desert and Arizona. Service on the Canada-U.S. ferry line will stop on Monday, March 30, joining flights and boat service to Seattle.

Over sixty years, the Coho carried millions of vacationers twice a day, four times in summer, past generally welcoming border controls. Those controls were tightened after December 1999, when Algerian terrorist and refugee Ahmed Rassam, who was on his way to California to blow up LAX as a millennium New Year’s Eve surprise, was asked to open his trunk on the Port Angeles side.

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GESTION DU CORONAVIRUS EN FRANCE: UN MODELE A NE PAS SUIVRE Par Geneviève des Rivières (Article)

 

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Geneviève des Rivières

La France était bien mal préparée pour cette épidémie de coronavirus. Son système de santé a subi des coupures importantes depuis plusieurs années. Le gouvernement qui s'est vite retrouvé avec une pénurie de masques pour le personnel soignant des hôpitaux et des cliniques et celui des maisons de retraite de même que les policiers a dû en commander un milliard de la Chine. Les premières cargaisons arrivent cette semaine. L'Etat français est également incapable de faire du dépistage sauf pour les cas les plus avancés, faute de tests. Chez son voisin allemand qui suit le modèle sud-coréen dans cette crise, des tests à grande échelle ont été pratiqués dès le début de l'épidémie à la fin janvier. A la différence de la France, l’Allemagne fabriquait déjà des tests de dépistage. Entre 300,000 et 500,000 dépistages sont fait en Allemagne chaque semaine alors que la France n'a la capacité d'en faire que 10,000. L'Allemagne avait déjà à la mi-mars 25,000 lits de réanimation contre 5,000 en France.

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PRICE-FIXING BREAD BUT COMPETITION BUREAU INVESTIGATION DRAGS ON By Gavin Murphy (Article)

 

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Gavin Murphy

 

Introduction

On 19 December 2017, Loblaw Companies Limited (‘Loblaw’), Canada’s largest grocery store chain, and George Weston Ltd (‘Weston’), which owns national bread baker Weston Bakeries, admitted to participation in a packaged bread price-fixing scheme for more than 14 years that ran from late 2001 to March 2015. The two companies came forward to the Competition Bureau (‘the Bureau’), which assists the Commissioner of Competition in the administration and enforcement of the Competition Act (‘the Act’), [1] and said they would co-operate with the Bureau’s investigation into the industry. In return, the two companies were granted immunity from prosecution under the Bureau’s immunity program. [2] The Act provides severe criminal sanctions for those found guilty of price-fixing. [3]

At the time of the admission, Galen G. Weston, chair and chief executive officer of both Loblaw and Weston, said in a statement: “This sort of behaviour is wrong and has no place in our business or Canada’s grocery industry. This should never have happened.” He added those involved in the price-fixing activity are no longer with the companies. [4]

The two companies are not the only ones allegedly involved. Also implicated are Canada Bread Ltd, Canada’s other national baker, and retailers Sobeys Inc (‘Sobeys’), Wal-Mart Canada Corp (‘Wal-Mart’), Metro Inc (‘Metro’) and Ottawa-based discounter Giant Tiger.

Backstory
This startling admission should not come as a complete shock. In late October and early November, the Bureau executed search warrants to further its criminal examination into the alleged offence. The searches were conducted under court filings made by the Bureau on a confidential basis and remain sealed under a court order. [5]

These materials, particularly the information to obtain the search warrants, were scheduled to be made public on 18 January but were not released after an unidentified individual named in the documents filed an application against releasing them. A date to hear the application is scheduled to be set 26 January. [6]

“[The Bureau] is conducting searches related to a criminal investigation into allegations of anti-competitive conduct contrary to the conspiracy provisions of the Competition Act,” said Bureau spokesperson Marie-France Faucher at the time of the searches. “Bureau officers are conducting searches and are gathering evidence to determine the facts. There is no conclusion of wrongdoing at this time and no charges have been laid.” [7]

Manufacturers of packaged bread have been under pressure due to aggressive discounting [8] and a move by consumers to healthier options. But at the time of the searches, Sylvain Charlebois, dean of the faculty of management and professor in food distribution and policy at Halifax’s Dalhousie University, suggested a bread cartel was a remote possibility. He added that the Commissioner’s examination will not likely yield much – a prediction that may not ultimately hold up:
“Grocers know better than to engage in a doomed strategy of quotas and illegal price-setting activities. The mere spectre of a grocery cartel would not only be bad for business, it threatens to tear up the social contract with the Canadian public that they adhere to every single day. Consumers can expect to see deals being made within the industry in the days ahead. Food shoppers will almost certainly experience rebates in the bakery section as grocers rush to reassure consumers that a bread cartel in Canada is nothing more than a myth.” [9]

Coming forward but not all on the same page
Dean Charlebois may be wrong about the cartel but is right about the rebate. By their own admission Loblaw and Weston said price-fixing was an industry-wide phenomenon with participants regularly increasing prices on a coordinated basis. Upon learning of the practice in March 2015, Loblaw and Weston said that they immediately reported it to the Bureau and have fully co-operated with its examination since then. Sobeys, Metro, Canada Bread Ltd, Wal-Mart and Giant Tiger have all said that they are also fully co-operating with the Bureau’s investigation, nevertheless both Sobeys and Metro question Galen Weston’s assertion that the practice was industry-wide. According to Sobeys:
“Sobeys does not believe that it or any of its employees have violated the Competition Act. Any assertion of an industry-wide price-fixing arrangement has not been proven. Sobeys has always taken its compliance obligations seriously.

Sobeys will continue to fully cooperate with the Competition Bureau as it continues its investigation.” [10]
Metro echoed these sentiments:“Based on the information processed to date, we have found no evidence that METRO has violated the Competition Act and we do not believe that the Bureau’s investigation will have a material adverse effect on the Corporation’s business, results of operations or financial condition. Legal compliance is fundamental to METRO and the Corporation has a Code of conduct in place applicable to all employees.” [11]

In an effort to contain the damage and reassure Canadians that Loblaw was a good corporate citizen, the company offered customers a $25 gift card [12] in return for its admitted transgressions. The offer expired in May 2018. [13] While some consumers appeared happy to have $25, at least one commentator suggested Loblaw’s offer left much to be desired.

Said Denise Balkissoon in the Globe and Mail:
“Now, Canadians are able to sign up for a $25 gift card meant to soothe our collective irritation. When Loblaw announced the card in December, it estimated that three to six million people would participate. The company said it expected to spend up to $150-million on this clear attempt at mitigating both financial and public-relations losses.
The gift card tactic seemed to work for a minute, with many people getting excited about what was essentially a bribe. But my household goes through two loaves a week. If I was being overcharged 25 cents each time – an invented number, since I haven’t been given a real one – Loblaw is coming up at least $300 short.” [14]

Class action lawsuits too
It appears at least seven class action lawsuits have been launched as a result of allegations of bread price-fixing, with the first action initiated on 8 November in the Ontario Superior Court of Justice seeking $1 billion in damages and $100 million in punitive damages. It is still early days and none of these actions has been certified by a court so it is unclear at this point whether any will proceed. It should be noted that notwithstanding obtaining immunity from the Bureau for criminal charges, Loblaw and Weston would remain liable in any class action lawsuits.

Loblaw initially said consumers who receive the $25 gift card intended as a goodwill gesture would have that amount deducted from any future class action court judgment or settlement. This is not necessarily the case, as the Ontario Superior Court of Justice said in a motion challenging the terms of the rebate, noting that Loblaw’s position may be premature. Said Justice Edward Morgan:
"When taking up the card offer, the consumer is advised that the card may ultimately replace $25 worth of settlement value, but that is not for certain. On the other hand, Loblaw has advised of its intention to offset the cost of the card against any eventual award or settlement, but that is equally not for certain. Both Loblaw’s (like the other Defendants) and the consumer/class members will have the opportunity of presenting any eventual settlement for approval by the court at the time, and that will be based on the fairness, reasonableness, and adequacy of the settlement overall." [15]

Conclusion: No way to make dough. Who kneads it?
Did Loblaw and Weston jump the gun after they uncovered evidence of an alleged bread cartel? To avoid potential criminal liability they may have taken pre-emptive steps to benefit from immunity in the event the Bureau determined that price-fixing for packaged bread had occurred as per s. 45(1) of the Act. [16] If price-fixing were ‘industry-wide’ as they claimed, why have Sobeys and Metro been so adamant about denying any involvement? Sobeys even went so far as to suggest that Mr Weston’s comments about an industry-wide price-fixing arrangement were possibly defamatory and potentially actionable. [17]

While it is rash to draw any definitive conclusions about where this case is headed, there may be a cautionary tale to bear in mind involving the Bureau’s examination into allegations of price-fixing by chocolate manufacturers.

The chocolate case concluded with a stay of proceedings entered into court on 17 November 2015 against two parties following the Bureau’s prosecution referral for alleged price-fixing. An earlier stay in September 2015 was also entered against two companies and two individuals.

The file originally came to the attention of the Bureau in 2007, after Cadbury Adams Canada Inc provided information on the alleged price-fixing under the Bureau’s immunity program. Criminal charges were laid against three companies and three individuals in June 2013 for allegedly fixing the price of chocolate confectionery products in Canada between 2002 and 2008. As part of the investigation, Hershey Canada Inc pleaded guilty to a criminal charge of price-fixing and was fined $4 million. The company co-operated with the investigation and the Bureau recommended that it receive lenient treatment. [18]

Are there parallels with the bread probe? Not much has changed since the bread case first came to light. Two parties have been granted immunity and all the others are on record co-operating with the Bureau’s investigation. No charges have been laid and the price of a loaf of packaged bread has not changed.

Presumably the Bureau is continuing its examination with the support and co-operation of Loblaw, Weston and the others. Consumers applied for their $25 gift cards - offer now expired - and class action lawsuits are working their way through the legal system.

Executing search warrants does not imply guilt. Searches are investigatory tools to assist in determining whether there is enough evidence to refer a matter for prosecution under the Act’s criminal provisions. Will the Bureau find that evidence or will the case essentially mimic the chocolate one (but for a guilty plea in the latter)? Only time will tell. Until there are more definitive developments, all that can be said is that fixing prices is no way to make dough. Who kneads it?


[1] Competition Act, RSC 1985, c. C-34, as amended.
[2] Under the Bureau’s immunity program, a party or parties that disclose to the Bureau an offence not yet detected or provide evidence leading to the filing of criminal charges may receive immunity from prosecution provided the party co-operates with the Bureau’s investigation. For further details on the immunity program see www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/vwapj/ImmunityProgram-2010.pdf/$FILE/Immunity-Program-2010.pdf [accessed 20 Jan 2018].
[3] Section 45(2) of the Act says in relation to conspiracies such as price-fixing: ‘Every person who commits an offence under subsection (1) is guilty of an indictable offence and liable on conviction to imprisonment for a term not exceeding 14 years or to a fine not exceeding $25 million, or to both.’
[4] Loblaw, ‘George Weston and Loblaw take action to address industry-wide anti-competitive activity’, 19 December 2017; available at: media.loblaw.ca/English/media-centre/press-releases/pressrelease-details/2017/George-Weston-and-Loblaw-take-action-to-address-industry-wide-anticompetitive-activity/default.aspx [accessed 20 January 2018].
[5] The court documents were made available to the companies involved and other affected parties on 19 December.
[6] ‘Bread price-fixing documents set to go public Thursday will remain sealed, Loblaw says’, the Toronto Star, 18 January 2018; available at: www.thestar.com/business/2018/01/18/bread-pricefixing-documents-set-to-go-public-thursday-will-remain-sealed-loblaw-says.html [accessed 23
[7] ‘Watchdog probes grocery sector over alleged bread price fixing’, the Globe and Mail, 1 November 2017; available at: www.theglobeandmail.com/report-on-business/watchdog-probesloblaw-metro-others-over-alleged-bread-price-fixing/article36787965/ [accessed 20 January 2018].
[8] At least one major discount chain, Dollar Tree Canada, regularly sells bread baked by both Weston and Canada Bread Ltd for $1.25 a loaf.
[9] ‘Bread investigation is just a slice of a bigger food fight’, the Globe and Mail, 3 November 2017; available at: www.theglobeandmail.com/report-on-business/rob-commentary/bread-pricefixing-investigation-just-a-slice-in-a-bigger-food-fight/article36815326/ [accessed 20 January 2018].
[10] Sobeys, ‘Competition Bureau investigation into price fixing’, 20 December 2017; available at corporate.sobeys.com/wp-content/uploads/2017/12/Competition-Bureau-Investigation-into-BreadPrice-Fixing.pdf [accessed 20 January 2018].
[11] Metro, ‘Update: Competition Bureau investigation on Bread’, 19 December 2017; available at https://www.corpo.metro.ca/en/media/newsroom/2017/update-competition-bureauinvestigation.html [accessed 20 January 2018].
[12] Loblaw prefers to call these cards a ‘coupon’.
[13] A modest movement has started to encourage consumers to donate the $25 gift card to local food banks.
[14] ‘Loblaw serves up some baloney’, the Globe and Mail, 11 January 2018, available at: www.theglobeandmail.com/opinion/along-with-bread-price-fixing-loblaw-serves-upbaloney/article37554486/ [accessed 21 January 2018].
[15] David v Loblaw, 2018 ONSC 198, at para 25, 9 January 2018; available at: www.ontariocourts.ca/search-canlii/ocj-en.htm [accessed 22 January 2018].
[16] Section 45(1) of the Act says: ‘Every person commits an offence who, with a competitor of that person with respect to a product, conspires, agrees or arranges (a) to fix, maintain, increase or control the price for the supply of the product.’
[17] ‘Sobeys assails Loblaw for throwing it ‘under the bus’ in bread probe’, the Globe and Mail, 22 December 2017; available at: www.theglobeandmail.com/report-on-business/sobeys-assails-loblawfor-throwing-it-under-the-bus-in-bread-probe/article37415351/ [accessed 21 January 2018].
[18] As well, four of the largest chocolate producers in Canada agreed to pay $23.2 million to settle a class-action lawsuit, although all four denied any guilt. This document is protected by copyright laws and international copyright treaties. Non-authorised use of this document constitutes a violation of the publisher's rights and maybe punished byup to 3 years imprisonment and up to a € 300 000 fine (Art. L 335-2 CPI). Personal use of this document is authorised within the limits of Art. L 122-5 CPI and DRM protection. www.concurrences.com 5 Gavin Murphy |Concurrences | N°86153

CANADA'S ROLE IN A WORLD OF TERMOIL By Jeremy Kinsman (Article)

 

Jeremy Kinsman

Jeremy Kinsman

After the end of the Second World War in 1945 and following the fall of the Berlin Wall in 1989, Canada played an important middle power role in the post-war and post-Cold War spread of democratic values and free market economies. But that’s not the shape or direction of today’s emerging world of turbulence. What is Canada’s role in this new world of turmoil?

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DIPLOMATS WORST NIGHTMARE - THE TRUMP PRESIDENCY By Jeremy Kinsman (Article)

Jeremy Kinsman

Jeremy Kinsman

 

Watching the public hearings on the impeachment of Donald Trump is worrying on many levels, but for a career diplomat, it’s sickening.

As a long-time Canadian Foreign Service officer and former ambassador to Russia, the European Union and the United Kingdom, among other postings, I feel gutted over the excruciating position that U.S. diplomats on duty in Kiev and Washington were put in during the Trump shakedown of Ukraine. The not-only politicized but corrupt back-channels, the previously unthinkable judgment calls, the conversations you wish you’d never heard much less been a part of: short of avoidable loss of life, the Trump doctrine on foreign affairs is pretty much a diplomat’s worst nightmare.

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BREXIT: A RATIONALE, NOT A DEFENSE By Jeremy Kinsman (Article)

 

Jeremy Kinsman

Jeremy Kinsman


Brexit: A synonym for political chaos and confusion. To ardent advocates in a divided and embittered Britain, it represents a noble and historic national cause. Opponents fear it will reduce the United Kingdom’s stature, prosperity, and even size, tempting Scotland and Northern Ireland to defect from what they see as English nativism. Polls indicate most in Britain regret the way the 2016 referendum amounted to a careless leap in the dark, a simplistic binary choice then Prime Minister David Cameron presumably didn’t think he would lose and hardly tried to win.

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MOST CANADIANS DON'T WANT LAWS AND ENTITLEMENTS BASED ON RACE By Peter Best (Article)

 

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Peter Best

(JustOttawa’s Note: Peter Best, in authorizing JustOttawa to publish Chapter 1/ Introduction of his book “There is No Difference” asked that his website, thereisnodifference.ca., be noted. He also referred to Jack Major, retired justice of the Canadian Supreme Court who had written to Best, saying “There is No Difference” continues to impress me no doubt because I agree with it.” Major who had personal experience in the Residential School system says that it is a “myth” that native children were “torn from happy, loving homes.” Many were in fact saved from death by malnutrition and tuberculosis. English was mandatory but “how else to equip the student to function off a particular reserve?”.)

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BEING BACK: FOREIGN POLICY AS A CAMPAIGN ISSUE By Jeremy Kinsman

Jeremy Kinsman

Jeremy Kinsman

Foreign policy rarely figures as a driving issue in Canadian elections. But in 2019, Canada’s place in the world and international stability itself are severely challenged, in large part because of the disruptive actions of the world’s most powerful country—and historically our most important ally—next door. However, don’t expect leaders to prioritize foreign policy in the campaign. (At this writing, Prime Minister Justin Trudeau has not yet accepted an invitation for the Munk School of Global Affairs and Public Policy debate scheduled for Oct. 1).

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OH, YOU'RE CANADIAN? By Jeremy Kinsman (Article)

 

Jeremy Kinsman

JEREMY KINSMAN

In Delray Beach, Florida, meeting one more snowbird holds little mystery. But for a local’s first-time encounter in Ulan Bator or Timbuktu, a Canadian can seem exotic. In London or Berlin, Shanghai or Santiago, people think they know us from hearsay but their impressions can be distorted.n the autumn of 2000, before 9/11 changed our world, when England was still basking in apparent prosperity and self-satisfaction, I opened London’s Sunday Times. Headlining the Arts section was an interview with Margaret Atwood, short-listed for the Booker Prize for the year’s best novel in English. The journalist declared he had just met that “rarest” of species—“an interesting Canadian.”

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