OTTAWA, October 19, 2004 — More than 8,600 consumers across Canada, who bought a John Deere "100" series lawn-tractor from one of John Deere Limited's Canadian dealerships between January 1, 2003 and August 31, 2003, will receive a 5% cash rebate as a result of a Competition Bureau price maintenance inquiry. The cost to John Deere Limited for these rebates will total $1.191 million.
The Bureau investigated allegations that during this eight-month period, John Deere Limited discouraged John Deere dealers from selling John Deere "100" series lawn-tractors below the suggested prices. While John Deere Limited was not charged with an offence and has not admitted any liability, it has agreed to the voluntary rebates to address the Commissioner's concerns.
Under the price maintenance provisions of the Competition Act, it is a criminal offence to attempt to influence upward or discourage the reduction of resale price by threat, promise, agreement or other like means or to refuse to supply or otherwise discriminate against a person because of their low pricing policy.
"When businesses maintain prices, they distort market forces and consumers pay more," said Colette Downie, Acting Deputy Commissioner of Competition. "This landmark resolution is the first time a price maintenance investigation has resulted in direct restitution to consumers."
As a result of the Bureau's inquiry, John Deere Limited has agreed to the terms of a Consent Prohibition Order, filed today with the Federal Court of Canada. To meet the terms, John Deere Limited will develop a Competition Law Compliance Policy Program and implement changes to its administrative and sales practices in Canada, in addition to providing the consumer rebates.
"John Deere Limited's willingness to cooperate and to address the Competition Bureau's concerns without costly litigation for taxpayers was an important factor in settling this case," said Ms. Downie. "This is a positive resolution for consumers."
Eligible consumers will receive rebates by mail from John Deere Limited within a six-week period. All inquiries regarding the rebates can be directed to John Deere Limited at (905) 945-7425.
The Competition Bureau is an independent law enforcement agency that promotes and maintains fair competition so that all Canadians can benefit from competitive prices, product choice and quality service. It oversees the application of the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act.