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Competition bureau looking at gas markets after smashing Quebec price-fixing cartels

MONTREAL - After clamping down on a network of gasoline cartels in Quebec for price-fixing, the federal Competition Bureau says it is continuing to investigate whether other Canadians are also getting scammed at the pump.


MONTREAL - After clamping down on a network of gasoline cartels in Quebec for price-fixing, the federal Competition Bureau says it is continuing to investigate whether other Canadians are also getting scammed at the pump.

Criminal charges laid Thursday against 13 people and 11 companies for allegedly fixing gasoline prices in Quebec are the first in Canada since 1955.

Three companies, including Ultramar Ltd., pleaded guilty and were fined a total of $2 million, while a former Ultramar employee received a $50,000 fine.

Competition officials are promising to find out the answer to a question on the minds of thousands of Canadians as gas prices continue to climb: How widespread is price-fixing in the industry?

"We follow the gas market very closely," bureau commissioner Sheridan Scott told a news conference in Montreal as she announced the various criminal charges.

"I can assure you that the Competition Bureau will not hesitate to take action to stop price fixing in this industry."

Ultramar, the only major oil company being investigated, was slapped with a $1.85-million fine after acknowledging its role.

"This is one of the top fines that we have been able to attain for domestic cartels," Scott said.

She stressed there was no evidence that Ultramar's head office was directly involved in the cartel.

"This is obviously a regrettable situation that we deplore," Christian Houle, Ultramar motorist sales network vice-president, said in a statement.

The other accused companies are mainly local franchisees operating under the banner of such recognizable brands as Esso and Shell.

Les Petroles Therrien Inc., operating under the Petro-T banner, and Distributions Petrolieres Therrien were fined a combined $179,000.

Jacques Ouellet, an Ultramar employee who has since left the company, was fined $50,000.

Consumer groups speculated the charges will only feed long-simmering suspicions of widespread collusion among gasoline retailers.

"I think this story will boost the anger of consumers regarding the price of gasoline," said Charles Tanguay, spokesman for a Quebec association of 11 consumer protection groups.

Tanguay added some of the fleeced clients will likely resort to a class-action lawsuit to attempt to recoup some of their money.

Scott indicated the companies charged represented only a fraction of the total number of stations that took part in the various cartels that operated in Thetford Mines, Victoriaville, Magog and Sherbrooke.

In Victoriaville, 23 of the city's 24 gas stations are believed to have been colluding over the price of gas. More than 80 stations took part in Sherbrooke.

Scott refused to put an exact dollar figure on the alleged conspiracy. But she claimed that if the four cartels had managed to jack up the price of gas by just one cent for an entire year, motorists would be out a collective $2 million.

The charges come following a meticulous investigation that began in 2004.

Scott said the bulk of the bureau's evidence comes from thousands of RCMP wiretaps where suspects were overheard establishing a common price and date when it would be raised.

The competition bureau also carried out more than 90 search warrants, seizing bills and other financial evidence.

"It's a big challenge for us to lead such investigations," Scott said.

The suspected companies face a maximum $10 million in fines under the conspiracy charges, while the individuals face up to five years in jail.

 
 
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