Competition Bureau to Investigate Canadian Airline Industry with Market Study

Canada’s Competition Bureau has announced the commencement of a market study specifically focused on the Canadian airline industry.

The study aims to assess the level of competition within the airline sector and explore potential avenues for enhancing competition through governmental measures.

Market studies conducted by the bureau typically investigate obstacles to competition, such as existing regulations or policies, within a particular industry.

During her testimony before a parliamentary committee examining airline competition in Canada, Melissa Fisher, a deputy commissioner at the bureau, disclosed the bureau’s intentions.

She emphasized the bureau’s commitment to enhancing competition for the benefit of domestic air passengers, as well as the employees and entrepreneurs supporting these services.

Ms. Fisher referenced recent events that have raised concerns regarding the state of competition in the airline sector.

The parliamentary committee initiated the study following the closure of Lynx Air in February, as highlighted by Conservative MP Ryan Williams.

Lynx Air was the eighth budget airline to cease operations in Canada since 2000.

Subsequent to Lynx Air’s closure, low-cost carrier Swoop also shut down, and WestJet acquired Sunwing Airlines in 2023.

Ms. Fisher noted that this will be the bureau’s inaugural study with the new powers gained in December, including the authority to mandate information from companies.

It follows the Competition Bureau’s recent investigation of the grocery industry.

Vass Bednar, executive director of the Master of Public Policy Program at McMaster University, regarded the previous study as fruitful, sparking meaningful discussions.

With the bureau now equipped with “market study powers,” Bednar anticipates a more thorough and detailed assessment in the forthcoming study.