Life in Canada

Final Agreement Paves Way for More Competition in Canada's Real Estate Market

OTTAWA, October 24, 2010 — As a result of an agreement ratified today by members of the Canadian Real Estate Association (CREA), Canadians will have the ability to choose which services they want from a real estate agent when selling their home, and to pay only for those selected services. At the same time, the consent agreement between the Competition Bureau and CREA will ensure that real estate agents have the flexibility to provide innovative service and pricing options to customers. The agreement will be filed with the Competition Tribunal and effective immediately.

"I am pleased that CREA members have voted in favour of this agreement," said Melanie Aitken, Commissioner of Competition. "This resolution is welcome news for both consumers and real estate agents in Canada. For Canadian homeowners, it ensures that they will have the freedom to choose which services they want from a real estate agent and to pay for only those services. For real estate agents, it ensures that they will be able to offer the variety of services and prices that meet the needs of consumers."

In February 2010, the Commissioner of Competition challenged, before the Competition Tribunal, anti-competitive rules imposed by CREA on real estate agents who list residential properties using the Multiple Listing Service (MLS) system. The Bureau launched its challenge following three years of discussions and several months of intensive negotiations. After being approached by CREA to resume negotiations, the Bureau announced on September 30, 2010, that it had reached an agreement in principle that fully resolved the Commissioner’s concerns.

Under the agreement, CREA must eliminate its ability to adopt anti-competitive rules, including those that discriminate against real estate agents who are hired by consumers to offer a "mere posting" service. In the case of mere postings, a home seller hires a real estate agent only to list his or her property on the MLS system and agrees to handle all other details of the transaction directly.

A copy of the legally binding consent agreement will be available on the Competition Tribunal Web site once it has been registered. The agreement will remain in force for 10 years.

The Competition Bureau ensures that Canadians prosper from the benefits of a competitive marketplace, driving innovative products and services at competitive prices.

Is Canada now becoming a hollowed out shell? 'Quotes from Australia'.

REGINA - Saskatchewan is ramping up its effort to convince Ottawa to block BHP Billiton's US$38.6-billion bid to acquire PotashCorp by urging the federal government to heed a warning from the company's former chairman.

Premier Brad Wall noted Monday that former BHP chairman Don Argus warned of too much foreign control of resources in his home country of Australia.

Wall pointed to a 2008 article by the Hellenic Shipping News, in which Argus was quoted as saying: "If we fail to remain competitive, Australia will incur a substantial opportunity cost and, in the worst-case scenario, our resources will fall into overseas hands and we will become a branch office — just like Canada."

In a May 2009 edition of the Melbourne Herald Sun, Argus was quoted as saying "Canada had forfeited its resources sector, much to detriment of the country."

Wall said Argus's words "should give the federal government plenty of pause" as it considers the deal.

"He's advising his Australian government to not be like Canada because it's his view that Canada has become a branch plant economy when it comes to these takeovers. I'm not sure I share that view, but I do believe that it's important for the federal government to say 'no' to this deal for some of those same reasons," Wall said.

The Saskatchewan government came out firmly against BHP's bid last week, saying it does not provide a net benefit to the province or the country.

The premier said he believes Saskatchewan could lose between $3 billion and $6 billion in revenue from taxes and royalties if BHP's bid is successful. And he said Canada's strategic interests would be put at risk if it sold most of its potash industry — which accounts for about a third of the world's supply of the mineral used in fertilizer — to an international company.

Wall said it's a takeover attempt like no one has ever seen in Canada and would continue a trend that has already seen much of the country's steel and mining sectors swallowed up by powerful multinationals.

He brushed aside criticism that has flowed from many sources since he announced the province's decision.

"Countries have to make strategic decisions in the interest of certain sectors and resources. I think most companies respect that," said Wall.

BHP said it remains confident it can win over the province and get the deal approved by Ottawa.

BHP spokeswoman Bronwyn Wilkinson said in a phone interview from Vancouver that it would not be considered a "branch office."

"We would structure our business so that there wouldn't be any tax deferral, which generally an investor would be entitled to. So there wouldn't be a reduction in revenues for the province on our purchase of PotashCorp. We would locate the global potash headquarters in Saskatoon. Our potash management team would live there, would pay taxes there, would raise their families there," Wilkinson said.

"From our view, PotashCorp has actually drifted away from its Canadian roots and BHP Billiton will return control of the business to Saskatchewan from Chicago."

Saskatoon-based Potash Corp, of Saskatchewan Inc. (TSX:POT) is a corporate stalwart in the province. It was created by the provincial government in 1975 and privatized in 1989.

Last week, Prime Minister Stephen Harper pointed out that only 49 per cent is owned by Canadian shareholders. Several of its senior executives, including CEO Bill Doyle, spend most of their time at its offices in Chicago.

PotashCorp is promising to relocate some of its top executives to Saskatchewan, a guarantee BHP dismissed as a copy-cat move to curry favour during an increasingly bitter takeover battle.

Saskatchewan does not have the power to kill the BHP deal. It can only put forward its position to Ottawa.

Industry Minister Tony Clement wouldn't say if he plans to extend a Nov. 3 deadline as the federal government continues its review to determine if the takeover would be of net benefit to Canada.

"This week is obviously a critical week in terms of our review of the situation," Clement told reporters in Montreal.

But the minister is/was vague when asked if the deadline could be extended.

His words of wisdom are implanted in my mind.
"Nov. 3 is a date. It continues to be the date unless it isn't the date, but right now it's the date," he said.

Saskatchewan Energy Minister Bill Boyd is expected to meet with Clement on Tuesday. However, Wall said he expects the federal government to follow the province's recommendation.

"I'm confident that we've made a very compelling case," said Wall. "We will continue to make our case that this is very important for our province and for our country for the federal government to say 'no.'

PotashCorp shares closed up $1.82 at $146.90 on the Toronto Stock Exchange on Monday. BHP has bid $130 a share.

OTTAWA - The health of some 400 Canadian defined-benefit plans deteriorated in the first half of the year, the federal pension watchdog said Thursday.

The average solvency ratio for the plans fell to an estimated 87 per cent as of the end of June, according to a semi-annual report from the Office of the Superintendent of Financial Institutions.

That means the plans only had 87 cents worth of assets for every dollar of pension liability at that date, on average.

"The deterioration in the estimated ratio was largely due to weak pension fund returns during the first half of the year," said Judy Cameron, Managing Director of OSFI's private pension plans division.

"Since June 30th, market conditions have remained volatile. Although pension fund returns have improved, there has been a substantial decline in long-term interest rates."

Equity markets and long-term interest rates have huge impacts on fund assets and their solvency ratios, which measure a pension plan's financial health, although they have no direct effect on current payments to pensioners.

The federal government has been working on reforms to the legislative and regulatory framework for the private pension plans regulated by OSFI, which doesn't oversee pensions of companies that fall under provincial jurisdiction.

A number of changes to federal pension legislation and regulations came into effect in July, including new solvency funding requirements. I wonder why they would do that?..Watch this space!

The federal watchdog says the solvency of the defined-benefit plans it supervises was down three points at mid-year, from 90 per cent at the end of 2009.

Reader this is the Federal watchdog so the real picture may not be what they at this time report as I say watch this space for changes

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OTTAWA - The Bank of Canada now says it was wrong about how strongly the Canadian economy has been recovering and has changed its tune on raising interest rates, which will likely stay put at one per cent for some time. Its a disgrace I say.

The new bleak outlook, which has been forecast by everyone except Canada combined with China tightening its monetary policy, sent the loonie tumbling almost two cents US. Canada always blame someone else. Like the secret vote for the UN seat. Its easy to keep the wool pulled over the trusting Nations eyes. Yeh!

In an unusually detailed and much truer statement at Tuesday morning's policy rate announcement, the central bank's governing council said it now expects the recovery to be so protracted that it will take a full year longer to return to full capacity than it had thought. Animal Farm has its civic address in Canada.

As expected, the bank kept the trend-setting policy rate at one per cent after three straight increases since June that had put it in a lonely club of one among the G7 big economies when it comes to withdrawing monetary stimulus.

"The economic outlook for Canada has changed," the bank's senior officials wrote. What has it changed from .. may I ask and when did it change?

"At this time of transition in the global recovery, with a weaker U.S. outlook, constraints beginning to moderate growth in emerging-market economies and domestic considerations that are expected to slow consumption and housing activity in Canada, any further reduction in monetary policy stimulus would need to be carefully considered."

Now for the 'out of the woodwork experts'

TD Bank chief economist Craig Alexander said markets had been expecting the benchmark interest rate to hold at one per cent, but not the central bank's negative statement.

"I think the market is surprised by the extent of revisions in economic growth and the very sombre tone," he said.

"I don't think the bank of Canada is going to pause for only one meeting. I think the most likely scenario now is the Bank of Canada is going to be on the sidelines for at least until next March."

Bank governor Mark Carney will want to see how much quantitative easing the U.S. will undertake, and how the U.S. economy fares, before resuming its tightening cycle, Alexander said.

In a new forecast, the bank said Tuesday it now believes Canada's economy will likely grow about three per cent this year instead of the 3.5 per cent it had predicted in July — and that's all due to a faster-than-expected start to the year.

Next year will be even worse, with moderate growth of 2.3 per cent, six-tenths of a point lower than previously projected.

It's not until 2012 that the bank sees the economy gathering steam, but at 2.6 per cent, that's still far below Canada's historic growth levels during expansionary periods.

More surprising was how far the bank's senior officers set back the time frame for the economy to return to normal, or full-capacity — to the end of 2012 from the previously thought end of 2011.

"This more modest growth profile reflects a more gradual global recovery and a more subdued profile for household spending," they wrote.

The bank said with household debt so high, it expects Canadians will spend less on consumer goods and on homes, meaning the housing market is in for a protracted cooling-off period.

Given that Ottawa is phasing out fiscal stimulus in March and consumers don't have the means to keep spending, the Canadian economy will need to depend on exports and business investments, two sectors that have been extremely weak over the past few years.

It warned that exports will be sensitive to currency movements, a reference to efforts by the U.S. to devalue their dollar and corresponding strength of the loonie.

For the rest of the world, the coming fight over currency exchange rates — largely between China and the U.S. — and unresolved global imbalances will result in a more "protracted and difficult recovery," the bank said.

Currency manipulation has emerged as the most contentious issue at the upcoming G20 finance ministers meeting later this week and leaders summit in November, both in Korea, with the potential to split the group between advanced and emerging nations.

The U.S. recovery will be particularly weak, it noted, with the corresponding drag on Canadian exports south of the border.

Even growth rates in emerging economies are expected to ease, the bank wrote, as fiscal and monetary policies are tightened.

As for prices, the bank's key focus, its best guess is that both total and underlying inflation won't reach the bank's two per cent target until the end of 2012. What will it be then I ask?

Federal government should stop hollowing out of corporate Canada: Jarislowsky

As the likelihood of a competing bid for PotashCorp diminishes, one of the Canadian fertilizer giant's biggest shareholders says BHP Billiton's US$38.6-billion takeover offer should be rejected by Ottawa, which is slated to rule on the bid in just over two weeks.

Montreal-based billionaire investor Stephen Jarislowsky said the bid is too low and should be defeated so Canada can avoid having another major company sold to foreign interests.

"Nobody else in the world gives their raw materials away and doesn't have control over them," Jarislowsky, the third-largest shareholder of PotashCorp, said in an interview Friday.

"Whether it's Australia, Russia, China, Japan, Venezuela, Mexico, nobody (does this) except a few fools. And we have fools from sea to shining sea."

Jarislowsky's comments came after the Reuters news agency reported that Chinese chemical giant Sinochem had abandoned its plans for a competing bid for PotashCorp. Neither PotashCorp, which has been seeking a white knight bidder, nor BHP, would comment on the report.

Federal Industry Minister Tony Clement is reviewing BHP's bid under the Investment Canada Act, which stipulates that any foreign takeover of a Canadian company must be of net benefit to Canada. He's scheduled to release his decision Nov. 3.

BHP Billiton has pressed Ottawa on the merits of its bid and noted that the Anglo-American company, the world's largest miner, has operated in Canada for decades and owns the country's first diamond mine, the Ekati project in the Northwest Territories which employs about 800 people.

The federal government has blocked only one foreign takeover outright under the act, and has approved several controversial deals that saw the ownership of most of Canada's steel and nickel mining industries pass into foreign hands.

Clement emphasized the Conservative government's openness to foreign investment, saying Canada is "open for business."

"We believe that having a judicious mix of both domestic and also foreign investment helps our economy be innovative, helps our economy grow, create new jobs and new opportunity, helps our consumers," Clement said Friday following a speech in Toronto.

However, he added that "there are occasions" when foreign investment won't be approved under the Investment Canada Act.

Jarislowsky, who owns 8.7 million shares or about three per cent of PotashCorp, said BHP's bid of $130 per share is too low, but wouldn't divulge what price would prompt him to sell his stake. The activist investor, founder and CEO of Montreal-based Jarislowsky Fraser Ltd., indicated that he'd prefer to see Saskatoon-based PotashCorp remain Canadian.

"I think that we should not lose all our companies. We can't even buy a decent portfolio in Canadian stocks anymore," he said.

"I've seen whole industries disappear in this country, being bought up. When I came to this country in 1949, Montreal was an enormous head office city. Now there's next to nothing left except a few French Canadian companies," he added.

"Why should we be so stupid to just hand these things over, one after another?"

PotashCorp CEO Bill Doyle has dismissed BHP's offer as far too low, but so far it's the only bid on the table.

The most likely alternative bidder was thought to be state-owned Sinochem, which was rumoured to be putting together an offer with Canadian pension funds.

Clement said Sinochem never even got as far as contacting Ottawa about a potential bid.

"I've never talked to them, they've never talked to me," he said. "There are no other bidders."

Shares in PotashCorp (TSX:POT) closed down $1.44 or just under one per cent to C$146.78 on the Toronto Stock Exchange — still far above BHP's offer of $130 a share.

On the New York Stock Exchange, shares in the company (NYSE:POT) fell 1.5 per cent cent in trading Friday, down $2.26 to $144.91.

"I don't think the bidding is having much impact on share prices anymore," said Mark Connelly, an analyst with Credit Agricole Securities in New York.

"The fundamentals in fertilizer are so strong that I can't imagine why any fertilizer investor wants to sell any of their stocks."

Shares in fertilizer producers have been climbing steadily since the U.S. Department of Agriculture lowered its corn production forecast last week. Lower yields are expected to boost demand for fertilizer as corn prices rise and farmers seek to produce more.

Connelly said BHP would have to raise its bid to $150 a share "for anybody to even consider it," but added that a fair premium would be closer to $190 a share.

Ottawa blocked an attempt by MDA (TSX:MDA) to try to sell its space division to American firm Alliant Techsystems Inc. in 2008, the first and only time the federal government rejected a foreign takeover outright under the act.

The government has come under fire for its handling of recent foreign acquisitions. Brazilian mining giant Vale's takeover of the former Inco for $19 billion in 2006 was criticized during a year-long strike involving about 3,000 employees at the company's operations in Sudbury, Ont. Vale employees in Voisey's Bay, N.L., are still on strike after more than 14 months.

And Ottawa is in the midst of a lengthy court case with U.S. Steel Corp. (NYSE:X), which acquired the former Stelco for more than $1 billion in 2007. U.S. Steel admits it broke employment and production promises it made under the Investment Canada Act, but says it had no choice because of the global recession.

The American steel producer recently shut down some of its operations in Hamilton for the second time in less than two years, but Clement said the undertakings made by the company were only in effect for a limited period of time.

"They have the power to make whatever decisions they want free from those undertakings because the undertakings have expired," he said Friday. "We still have a court case respecting the period during which the undertakings were in place and that court case continues."

Michael Gove Michael Gove promised to "clarify and shrink" the guidance to teachers on school discipline

"No touch" rules discouraging teachers from restraining and comforting children are to be scrapped, Education Secretary Michael Gove has said.

Mr Gove said the move was part of a "new deal" for teachers.

They would also be given the right to anonymity when faced by allegations from pupils.

The National Union of Teachers (NUT) welcomed Mr Gove's comments, saying teachers needed clear rules on how to handle classroom indiscipline.

But the Children's Rights Alliance for England said giving school staff more powers could breach human rights and child protection laws.

Mr Gove said the current system was too complicated, and promised to change the rules on school discipline.
He said: "At the moment if you want to become au fait with what this department thinks on how to keep order in class you have to read the equivalent of War and Peace.

"There are about 500 pages of guidance on discipline and another 500 pages on bullying. We will clarify and shrink that."

Mr Gove added: "Teachers worry that if they assert a degree of discipline, one determined maverick pupil will say 'I know my rights' and so teachers become reticent about asserting themselves.

"There are a number of schools that have 'no touch' policies and we are going to make clear this rule does not apply."

The education secretary said he did not believe staff should be able to hit children.

Of course teachers, like any other group have the right to fair treatment and due process, but let's have a balanced debate and not one that starts off with children as the problem”

But he added: "I do believe that teachers need to know they can physically restrain children, they can interpose themselves between two children that may be causing trouble, and they can remove them from the classroom."

Teachers should be able to console all victims of bullying, he said.

They would also be given the right to search pupils for "anything that is banned by the school rules".

NUT General Secretary Christine Blowers said: "We welcome the fact that Michael Gove is explicit that this is not a return to corporal punishment.

"Clearing up any grey areas regarding physical intervention would be welcome as clearly there are times when teachers need to intervene between pupils to prevent harm to themselves or others."
'Dangerous move'

But Children's Rights Alliance spokeswoman Carolyne Willow warned: "Giving even more powers to school staff to restrain children is a dangerous move that could contaminate schools and risks breaching human rights and child protection laws."

She said the priority should be making lessons "more simulating and engaging for all" and added: "Many schools are finding that adopting human rights values, with an emphasis on listening to children and young people and responding to their ideas and interests, bring great change.

Mr Gove also vowed to reduce the time scale in which allegations against teachers have to be either investigated, as well as granting accused teachers anonymity while inquiries are ongoing.

The move is likely to find favour with teaching unions like the NAS/UWT who have complained in the past that teachers who are the subject of false allegations become the victims of a public "witch hunt" while they are investigated.

But Ms Willow said giving teachers anonymity fed "the myth that schools are being swamped with malicious allegations" from children and parents when that was not the case.

"Of course teachers like any other group have the right to fair treatment and due process, but let's have a balanced debate and not one that starts off with children as the problem," she said.