Enforcement of Canadian"unfair"trade laws : the case for competition policies as an antidote for protection

Canada was the first country to enact comprehensive antitrust legislation (in 1889) and to institute an antidumping system (in 1904). Canada's original"unfair"trade legislation reflected a desire to prohibit predatory dumping. But the result of Canada's recent enforcement of unfair trade laws has been high levels of protection for a few well-organized firms. Canada's recent overhaul of its unfair trade legislation was not followed by any dramatic change in enforcement practice. If anything, the protection bias of Canadian enforcement has increased. The bias against exports from developing countries has also increased significantly in the years following implementation of the revised antidumping and countervailing duty legislation (SIMA). Comparing cases involving developed and developing countries suggests a protectionist bias against the developing country bloc. Thisbias increased in the years following the implementation of SIMA. The author argues that an approach based on competition policy principles or on an economywide perspective, by focusing on the broader impact of policies, offers an economically more rational way to deal with issues currently addressed by unfair trade remedies. While unfair trade laws aim to protect domestic competitors, competition laws strive to protect the competitive process. Unfortunately, international standards weigh against Canada modifying its current standard.