June 13, 2008

Frustrated Montreal Motorists Appeal to Big Oil Companies to Reduce Profits

By Peter Rakobowchuk, THE CANADIAN PRESS

MONTREAL - Angry Quebecers demanded Friday that gas companies lower the price of fuel at the pumps after news that some of them had acknowledged fixing prices.

"Companies are making too much profit," Manon Fairfield complained as her husband filled up at a Shell station in downtown Montreal.

"It's always the average person who pays more, while the big companies get more cash. They should just be satisfied with a small profit."

Fairfield's bitterness and that of other motorists came a day after criminal charges were laid against 13 people and 11 companies for allegedly fixing gasoline prices in Quebec.

Three of the companies, including Ultramar Ltd., pleaded guilty and were fined a total of $2 million. A former Ultramar employee was fined $50,000.

The other firms and individuals will appear in court at a later date.

In Quebec City, lawyer David Bourgoin said he has been hired by a man to seek permission for a class action lawsuit against gasoline companies over price-fixing.

Bourgoin said he doesn't believe people will be entitled to astronomical sums of money if the legal proceedings end up being successful.

"It could either be in the form of a global fund, where motorists would have fixed amounts they could access from the fund," Bourgoin said.

"It could also be paid to consumer groups who aim to protect motorists, or in rebates by the retailers on certain days."

Back in Montreal, Ultramar vice-president Ross Bayus said his company's price-fixing was an isolated incident.

"We are going to strengthen our training policy," Bayus said at the Port of Montreal. "This is an isolated event. We are very disappointed.... but we don't believe it's going to happen again."

That kind of remark wasn't enough to placate private chauffeur Pierre Germain, 54, as he got ready to fill up his Lexus.

"What's wrong with $1 billion, do you have to have $2 billion in profit?" he asked as he fired a few shots at oil and gas companies.

"But they're not going to take a cut, that's for sure."

Pierre Julien, who needs his car because he's in the restaurant business, says Canada should follow the example of Europe where gas prices are set by the government.

"I find the price of gas to be highway robbery," he said. "It's exorbitant."

Another motorist, who would identify himself only as "Mike," said he wasn't surprised by the price-fixing.

"We knew it all along, but it's not going to stop," the 54-year-old salesman said in an interview.

"They got caught and they're just going to do it a lot better next time."

But he just shrugged and said high gasoline prices won't stop him from driving his car.

"We're a car culture (and) I don't care if it's $5 a litre, I'll still drive," he said.

The debate over price-fixing also reached Ottawa where the Conservative government said it "won't tolerate high gas prices."

Colin Carrie, the junior industry minister, said more investigations are taking place across the country.

"The government is taking action because we will not tolerate high gas prices . . . ," he told the Commons.

But opposition MPs questioned the government commitment, saying more must be done to ensure there's no collusion among major oil and gas companies.

The Tories are rebuffing opposition demands to beef up the Competition Bureau or create a federal ombudsman on fuel prices.

The Bloc Quebecois currently has a private member's bill before the House that would give much broader investigative powers to the Competition Bureau.

The proposed legislation would also dramatically increase penalties, raising the initial fine for convicted individuals to $750,000 from the current $50,000 and the penalty for corporations to $10 million from the current $100,000.

"If there have been (no charges) since 1955, it proves the law isn't effective," said Bloc MP Mario Laframboise.

Michel Arnold, head of the consumer group Option Consommateurs, said the price-fixing will shake the confidence of consumers but ultimately won't alter the habits of motorists.

"I don't think it will have an impact on the price of gas for now," he said.

It is gasoline retailers, rather motorists themselves, who will feel the effects of the price-fixing allegations, Arnold said. He suggested the bureau may have succeeded in causing many to rethink skirting competition laws.

"We hope that given the current situation, where the price of gas is shooting up and retailers have lower profit margins, it will discourage many from engaging in collusion."