In the late 2010s, the coffee company Keurig touted the green credentials of its K-Cup pods, saying on social media and elsewhere the plastic was easily recyclable.
The claim sparked skepticism at the University of Victoria’s Environmental Law Centre. Together with Ecojustice, the centre filed a complaint in 2019 to the Competition Bureau, arguing the pods couldn’t be recycled in many cities.
It looked like a case of greenwashing, where something is advertised as green when in reality the product doesn’t live up to billing. Last January, the bureau’s investigation found the recycling claim was false or misleading in most provinces. Keurig had to pay $3.9-million to settle the case, and change its claims and packaging.
A company advertising its purportedly recyclable coffee pods as green might seem like a minor case, both for the environment and the lacklustre state of competition in Canada.
But it is one of numerous pushes from an emboldened Competition Bureau. There are several other greenwashing cases in motion and the bureau is more active than ever before on multiple fronts.
Consider this: The bureau challenged just six mergers at the Competition Tribunal from 1985, when the Competition Act was passed, to 2020. There’s since been a flurry of three cases at the tribunal – and Rogers-Shaw is the biggest yet. Last week, the tribunal dismissed the bureau’s case to block the deal. The bureau plans to appeal.
Canada is on the cusp of a revival of competition law. For years, the bureau had been an afterthought, hamstrung by legislation: some experts deem the Competition Act to be “toothless.” The federal government is finally confronting this sorry state of affairs. In November, Ottawa launched a major review of competition law. An overhaul is in the offing, including everything from bolstering the powers of the bureau to a total redrafting of the law’s priorities.
What’s going on inside the bureau is almost as important. Matthew Boswell took the helm in 2018 and he has been outspoken ever since. In late 2019, he urged Canada to build a “culture of competition.” In early 2020, just before the pandemic, the bureau outlined a plan with a goal of becoming a “world-leading competition agency.” Mr. Boswell, a former prosecutor, has talked about the importance of taking on more, and more challenging, cases.
In recent speeches, Mr. Boswell was blunt when he criticized Canada’s “weak business dynamism” and argued that the Competition Act enables “high levels of concentration – even monopolies.” The federal government is listening. The broad review is the most important move but Ottawa has also given the bureau more money to do its job. Annual funding had been stuck around $50-million, the same as a decade earlier. In 2021, the federal budget pledged increases to about $80-million annually by 2025. For now, Mr. Boswell operates from a position of weakness, such as not being able to fully stand up for consumers in deals such as Royal Bank of Canada’s bid for HSBC Bank Canada. So he is making more muscular use of the tools at his disposal.
Greenwashing – a modern twist on misleading advertising – is one. The bureau last September held a meeting about competition and green growth, and greenwashing was a main topic. After success against Keurig, the bureau is pursuing two more high-profile allegations. They both stem from Section 9 of the current Competition Act, where a small group can apply to the bureau to start an inquiry. That’s how the Keurig case started.
Last October, the bureau said it was looking at RBC. Ecojustice alleged the bank was greenwashing. RBC says it backs the 2015 Paris Agreement while it is also one of the biggest lenders to fossil fuel companies, some of which it called “sustainable.” A month later, the bureau said it was investigating the Canadian Gas Association for “alleged deceptive marketing practices.” The association, on a promotional website, describes its product – methane, a fossil fuel – as “clean.” The case comes from a complaint by the Canadian Association of Physicians for the Environment. In both cases, the allegations remain unproven.
The Competition Bureau for too long has operated with not enough power and inadequate funding – and that, sadly, was by design. Ottawa’s review could lead to big changes. A modernized Competition Act is essential, but the shift inside the bureau is equally key to a more confident and ambitious advocate for consumers.