France wants to allow dealers to sell fuel at a loss to drive down prices at the pump. Should Quebec follow suit?
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If the bill is approved, the measure will take effect in early December for a period of six months. This would allow dealers to sell their fuel at a lower price than the price at which they purchased it.
According to France Info, this could reduce prices by up to 25%.
The measure is exceptional because it has been banned for 60 years. The aim of this ban was to protect “small businesses” from dumping by multinational corporations.
For example, one scenario discussed is that the largest companies may suffer temporary losses in sales while they bleed their weaker competitors, who lose customers and money, until they disappear from the market and then leave the field to the multinational corporations to then collect revenue prices .
A good idea for Quebec?
Quebec has a similar measure, the minimum price for gasoline.
The Régie de l’énergie sets a minimum sales price for petroleum products each week for each region of Quebec. If a gas station sells gas below this price, the owner may receive a warning from the competition.
Last year, gas stations received 547 formal notices from competitors for selling gasoline at a price that was deemed too affordable or above the reserve price. And this is to the detriment of drivers.
A breathing space for drivers
“The Régie de l’Énergie’s estimated minimum price puts drivers at an unnecessary disadvantage and further impairs competitiveness between petrol companies. Quebec needs to take inspiration from France and give drivers a break by putting an end to this outdated mechanism,” stresses Nicola Gagnon of the Canadian Taxpayers Federation.
According to the FCC, for every liter of gasoline sold in Montreal for $1.65 in July, each motorist paid an average of 54 cents in various taxes to the government, accounting for about a third of the total bill.
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