Money Is price fixing a major problem in Canada?

06:21  04 january  2018
06:21  04 january  2018 Source:   macleans.ca

Bread price-fixing: Don't blindly accept Loblaw gift card, law firms warn

  Bread price-fixing: Don't blindly accept Loblaw gift card, law firms warn "Most people, or people like me, don't take the time to read every little provision when they're signing up or hitting accept on the Internet," Michael Vathilakis said on Wednesday. “Make sure you’re not relinquishing any rights.”Two class-action lawsuits have been filed, in Quebec and Ontario, against Loblaw Companies Ltd. and George Weston Ltd., among others, alleging the companies conspired to fix the price of packaged bread in Canada since 2001.

Opinion: Despite the righteous outrage over an admitted scheme to fix the price of bread, the reality is that Canada ’s system largely works.

WATCH ABOVE: More major grocery stores are being implicated in a 14-year bread price - fixing scandal. Now Canada 's competition bureau says it believes criminal charges may be appropriate. There's a problem playing the audio.

a store filled with lots of different types of food: Various brands of bread sit on shelves in a grocery store in Toronto on Wednesday Nov. 1, 2017. The Competition Bureau’s investigation into allegations of bread price fixing includes at least seven companies including Loblaw and Weston Bakeries, according to court documents. THE CANADIAN PRESS/Doug Ives© Used with permission of / © Rogers Media Inc. 2018. Various brands of bread sit on shelves in a grocery store in Toronto on Wednesday Nov. 1, 2017. The Competition Bureau’s investigation into allegations of bread price fixing includes at least seven companies including Loblaw and Weston Bakeries, according to court documents. THE CANADIAN PRESS/Doug Ives

Editor’s note: The opinions in this article are the author’s, as published by our content partner, and do not represent the views of MSN or Microsoft.

James Brander is a professor at the University of British Columbia’s Sauder School of Business.

What do auto parts, chocolate, computer memory, credit card services, and polyurethane foam have in common? One thing is that they have all been among the many subjects of recent price-fixing cases in Canada.

Former Manitoba grand chief files $1B class-action suit over bread price-fixing

  Former Manitoba grand chief files $1B class-action suit over bread price-fixing Derek Nepinak, the former grand chief of the Assembly of Manitoba Chiefs, has filed a $1 billion class-action lawsuit against multiple Canadian grocers after Loblaw Companies revealed it participated in industry-wide bread price-fixing for 14 years. define("homepageFinanceIndices", ["c.deferred"], function () { var quotesInArticleFormCode = "PRMQAP"; var config = {}; config.indexdetailsurl = "/en-ca/money/indexdetails"; config.stockdetailsurl = "/en-ca/money/stockdetails"; config.funddetailsurl = "/en-ca/money/funddetails"; config.etfdetailsurl = "/en-ca/money/etfdetails"; config.

Outside of Canadian supply-managed foods like dairy and eggs, Canada and U.S. foods generally follow the same price trajectory. Is price fixing a major problem in Canada ?

Bread Price - Fixing Probe Targeting At Least 7 Companies In Canada . Maple Leaf Foods sold its majority share in Canada Bread to Mexico's Grupo Bimbo in 2014. You should receive an email to confirm your subscription shortly. There was a problem processing your signup; please try again later.

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You can sign up for the $25 Loblaw gift card starting today. Here’s how.

  You can sign up for the $25 Loblaw gift card starting today. Here’s how. Some estimate Loblaw pocketed a whopping $1 billion in extra profit made on bread bought by all Canadians at the grocery chain over the 14 years. “We don’t believe $25 is much in the way of compensation,” says Bruce Cran, president of the Consumer’s Association of Canada (CAC), based in Vancouver. “A gift card for a few loaves of bread is not enough accountability for the length of time this scheme went on.

A major problem in Canada is its neighbours, who are worldly renown for being ignorant. Elections were called, and the campaign was fought largely on the issue of inflation, with the PC calling for a system of wage and price controls.

OTTAWA — The Competition Bureau's investigation into allegations of bread price - fixing includes at least seven companies from bakery wholesalers and discount chains to Canada 's three major grocers, according to court documents.

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Most price-fixing cases do not generate much media attention. However, recent news that major Canadian grocery chains are being investigated after allegations of fixing bread prices—after an admission by Loblaw—seems to have struck a nerve.

Is price fixing a larger problem in Canada than we realize? What is the overall cost to consumers? And is there enough enforcement effort? The bread price-fixing conspiracy apparently survived for 14 years and came to light only after voluntary disclosure by a participant. Was no one paying attention?

The reality is this: while improvements are possible, Canada’s approach to price fixing works well—and the country actually remains an exemplar to the rest of the world in this area.

Judge rules Loblaw gift card terms not misleading

  Judge rules Loblaw gift card terms not misleading TORONTO - An Ontario judge has ruled that it's too early to determine the enforceability of Loblaw Companies Ltd.'s policy that consumers who receive a $25 gift card from the company waive their right to that sum in possible future settlement money from a bread price-fixing scheme class-action lawsuit. Ontario Superior Court of Justice Edward M. Morgan dismissed a motion challenging the terms of Loblaw's gift card plan. The company announced Monday L

Actually the taxes are not random, we just don't include them in the price of the product so you know the actual worth of what your buying and how much tax is. A major problem in Canada is its neighbours, who are worldly renown for being ignorant.

Youth unemployment is a major problem in many countries. In Canada , the youth unemployment rate is 15.5 percent, while the national average is about half that. It’s even worse in Europe, with almost a quarter of people between the ages of 18 and 24 unemployed.

MORE: This chart shows how bread prices soared during the price-fixing scheme

Price fixing has been illegal in Canada since 1889, when Canada adopted the world’s first modern competition law, one year before similar legislation in the United States. Concerns about price fixing go back even further. The father of modern economics, Adam Smith, famously wrote in his 1776 treatise The Wealth of Nations that “people of the same trade seldom meet together, even for merriment or diversion, but the conversation ends in a conspiracy against the public or in some contrivance to raise prices.”

Smith emphasized the value of private enterprise, free markets, and competition. It took a long time, but laws designed to promote competition by preventing price fixing and other anti-competitive practices are now the global norm.

However, price fixing is hard to detect and difficult to prosecute. The popular 2009 movie The Informant provides a humorous but fairly accurate account of an FBI investigation into price fixing of lysine, which is used in animal feed. In it, a high-level “whistle-blower” cooperated with the FBI for three years, including wearing a “wire” and setting up video recordings of price-fixing discussions. While this case resulted in jail sentences and large fines, the difficulty is that whistle-blowers are rare, and, as illustrated by the movie, the investigative resources needed are substantial.

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Fixed Income. Bonds. Financial Advisors. If it isn’t it is only because the problem has disappeared in a shorter time period through a major housing crash. The percentage increase in just the past couple of years in Canada is absurd, especially considering how much prices had already risen before then.

The recently revealed 14-year industry-wide arrangement to co-ordinate bread prices in Canada doesn't seem to shock experts, who say price fixing is Historically, fines were quite small compared to the gains companies could make, said Brander, so the penalties were not a major deterrent.

In Canada, price-fixing is investigated by the Competition Bureau, a federal government agency. Its work has led to both large fines and a few prison sentences. But the Bureau has limited resources; it can investigate only a small number of cases and does not retain the fines it generates, which go into general government revenue. Increasingly, the Bureau cooperates with U.S. and other authorities on international price-fixing conspiracies. In the lysine case, Canada was able to “piggyback” on the U.S. case and obtain large fines from the conspirators based on their sales of lysine in Canada. This latest case may be an indicator that the Bureau should receive more resources to closely monitor markets with unusual pricing patterns or with prices that rise more rapidly than in comparable markets.

MORE: Loblaw could owe you much more than $25

An additional avenue for enforcement of competition law is private lawsuits. Typically, a large group or “class” of purchasers harmed by price fixing act together to bring a “class action” lawsuit against the accused parties. Such “private enforcement” is more significant than government enforcement in both the number of cases brought to court and in the size of the penalties imposed. For example, after producers of DRAM computer memory admitted to price-fixing in U.S. cases, the Bureau initiated a preliminary investigation but soon closed it. However, a Canadian class action against these producers, based largely on U.S. evidence of an international price-fixing conspiracy, led to settlements of almost $80 million in Canada. Law firms who work on these cases get a share of such payments, but most of the money goes to purchasers of the affected products.

Judge rules Loblaw gift card terms not misleading

  Judge rules Loblaw gift card terms not misleading TORONTO - An Ontario judge has ruled that it's too early to determine the enforceability of Loblaw Companies Ltd.'s policy that consumers who receive a $25 gift card from the company waive their right to that sum in possible future settlement money from a bread price-fixing scheme class-action lawsuit. Ontario Superior Court of Justice Edward M. Morgan dismissed a motion challenging the terms of Loblaw's gift card plan. The company announced Monday L

The retailers alleged to be part of the price - fixing scheme are major grocers Loblaw Cos. Ltd. (Real Canadian Superstore, No Frills, Provigo), Sobeys Inc. and Metro Inc.; and discounters Walmart Canada Corp. and Giant Tiger.

"Towards the end of last year it came to my attention that we had a major bug in one of our core products," Pichai said in a keynote Google's emoji experts were also tasked with fixing an image of a half-full mug of beer which had an inexplicable gap between the beer and the cloud of foam on top.

For every price-fixing case that gets to court, there are probably several more that go undetected. However, even undetected price-fixing agreements are hard to maintain, as participants often cheat on the agreement. And, more importantly, the probability of getting caught and paying large fines is high enough to act as a significant deterrent.

As a result, the vast majority of sellers in Canada do not engage in price fixing, and relatively few products are affected. Cases are fairly common in that several usually come to light every year, but that number is small compared to the thousands of different products that consumers buy.

Overcharges due to price-fixing are typically somewhere between 10 per cent and 50 per cent of the purchase price. But because only a few products are affected, the total effect of price fixing (including both detected and undetected cases) is certainly less than one percent of total consumer expenditure—probably much less. The total overcharge is still at least hundreds of millions of dollars per year, but since there are over 14 million households in Canada (comprising over 36 million people), the effect on any one household is small.

The bread case has rightly sparked significant outrage, and it does illustrate a failure or at least a weakness of the current enforcement system for price fixing. But as with all areas of criminal law, some serious crimes go undetected for a long time. In this case, the system did eventually work, and the Bureau’s policy of more lenient treatment for voluntary admissions of price fixing likely helped—as will the substantial punishment to come, a reminder for other companies of the potential costs of price fixing. Ultimately, largely because of such enforcement, Canadian consumers enjoy a generally healthy and competitive retail environment.

Loblaws’ price-fixing on bread may have cost you at least $400 .
Any way you slice it, Canadian bread shouldn’t have cost this muchWNGRF

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