Competition Policy at a Crossroads: Aligning Enforcement With Canada’s Productivity Imperative

Key Highlights

• Canada’s federal government has prioritized Canadian productivity, reducing red tape in government regulations and attracting direct foreign investment.
• The European Union, United Kingdom and United States are similarly moving in this direction, particularly in the area of competition law enforcement, by moving to cut red tape, re-engaging with the business community on a cooperative basis and allowing for scale to achieve increased productivity.
• Canada’s Competition Bureau should consider how its enforcement approach can better align with the economic priorities of the Canadian government and its major trading partners.

A Global Shift Toward Productivity and Strengthening Domestic Economies

Across major economies, competition policy is being recalibrated to support broader economic objectives, most notably: productivity growth, investment attraction, increases in scale and national competitiveness.

In the European Union, policymakers are increasingly focused on enabling European champions capable of competing globally. European Commission president Ursula von der Leyen has championed a “new approach” on competition that is “more supportive of companies scaling up in global markets.” The European Commission is also in the process of modernizing its merger guidelines in response to new economic realities, including an expected focus on efficiency and pro-investment standards and a rebalancing of the benefits of mergers in strategic sectors such as defence and energy.

The United Kingdom’s recent reforms have plainly emphasized reducing regulatory burden and accelerating pro-growth decision-making. A May 2025 policy paper titled “Strategic Steer to the Competition and Markets Authority” made this shift clear: “The primary mission of [the U.K.] government is economic growth. Free and fair competition and effective consumer protection support growth by driving forward innovation, increasing productivity, and encouraging investment — including international direct investment — into the U.K.” Constructive and cooperative engagement with businesses is also a renewed priority. The Competition and Markets Authority (CMA) has been instructed by the U.K. government to:

“provide proactive, transparent, timely, predictable and responsive engagement with businesses” to enable them, in turn, to engage quickly and effectively while “focus[ing] on collaborative approaches to resolving issues with interested parties.”

While recent U.S. enforcement has emphasized structural concerns in certain sectors, there are also indications — particularly in policy and political discourse — of renewed attention to the role of scale, industrial policy and national competitiveness in shaping enforcement priorities.

Though specific approaches differ, the direction of travel by these major economies is clear: competition policy is being integrated into a broader economic strategy aimed at lowering costs, but also increasing scale, driving productivity and encouraging investment.

Canada’s Economic Priorities Are Moving in the Same Direction

Canada has been similarly clear about the need to focus on growth. Since April 2025, the federal government has increasingly emphasized the need to reduce regulatory friction, prioritize nationally significant projects and sectors, attract and diversify foreign direct investment, and strengthen Canada’s global economic positioning in a rapidly changing world.

By way of just a few examples, the current government has initiated (1) the establishment of a Major Projects Office to fast-track strategically important energy and transportation nation-building initiatives, (2) a recently announced first-ever Canada Investment Summit designed to promote Canada as a premier destination for businesses seeking to invest capital, and (3) the launch of a Defence Industrial Strategy to grow Canada’s defence sector and increase capacity and competitiveness of homegrown defence suppliers.

Cost of living and affordability remain key government priorities. However, there is also a clear recognition that growth, productivity and cost competitiveness are foundations to a sustainable economy capable of driving desirable outcomes for consumers. The Government of Canada’s 2026 Spring Economic Update makes this clear by emphasizing that productivity and affordability are complementary competition policy objectives, expressly positioning competition policy as part of Canada’s productivity and affordability agenda while removing inefficient government policies that impede competition through regulation, procurement and industrial support. This is a welcome recognition that competition policy cannot be viewed in isolation from Canada’s broader productivity, investment and scale challenges. The next step is to focus on how those objectives can be achieved.

Canada’s Competition Policy Should Align With the Productivity Imperative

Canada’s competition policy is at an inflection point. Reforms enacted in 2022 and 2024 focused on bringing Canadian and U.S. competition law agencies into greater alignment. At the time that those reforms were being discussed, commentators including authors of this bulletin cautioned that a “U.S-styled makeover of Canadian competition laws…would be short sighted” given potentially shifting priorities after another election cycle and that Canadian competition policy should instead be “tailored to unique facets of the Canadian economy.” (See also, Efficiencies Exception: Let’s Keep It). Ultimately, these reforms placed onerous burdens on Canadian businesses and set enforcement standards based on market shares rather than increased productivity. Recent remarks by Canada’s Interim Commissioner of Competition advocated for a continued, indeed expanded, use of those enforcement tools. However, those reforms were enacted when reliance on trading partners was not in question and before the global shift focusing on productivity and growth.

A fresh competition policy approach is needed to remove regulatory burdens, allowing scale efficiencies to be achieved and facilitating Canadian capital formation — in order to deliver longer-term lower prices and improved consumer welfare. Without removing red tape and barriers to scale, efforts to enhance Canada’s economic position in the new world order will fall short.

Canada now faces a strategic choice. The Competition Bureau needs to be aligned with the rest of the government (and indeed global trends) to focus squarely on an agenda centered on productivity, investment, scale and red-tape reduction, consistent with the policy approach taken by our major trading partners. Indeed, the Competition Act (in its purpose clause) embodies this type of integrated approach by highlighting the “efficiency and adaptability of the Canadian economy,” “opportunities for Canadian participation in world markets,” and “provid[ing] consumers with competitive prices and product choices” as mutually inclusive objectives.

Conclusion

For Canadian and international businesses, the current environment presents both uncertainty and opportunity. Global competition policy is evolving to reflect a central economic reality: productivity, investment and scale are prerequisites to sustainable competition and lower prices. Ensuring that competition policy and enforcement evolves in tandem with these objectives will be critical to maintaining Canada’s competitiveness in an increasingly strategic global economy.

For more information, please contact the authors or any other member of our Competition, Antitrust & Foreign Investment group.