The finance committee of the House of Commons has requested Ottawa to reject the Royal Bank of Canada’s $13.5 billion acquisition of HSBC’s domestic subsidiary, citing a lack of competition in the country’s banking industry.

The committee’s findings, released late Wednesday, come weeks after the Competition Bureau cleared the transaction, paving the way for one of the country’s largest financial transactions. However, the accord has been criticized.

The transaction, which was announced in November 2022, is now in the hands of Canada’s finance minister and the Office of the Superintendent of Financial Institutions (OSFI). It is expected to be finished in the first quarter of 2024.

“Removing competition in the financial sector could raise banking fees for Canadians who already pay more for financial services due to an already uncompetitive financial sector,” the panel found in its report.

Conservative Leader Pierre Poilievre has also urged the federal government to reject the agreement, claiming that rejecting it is a concrete action the government could take to address cost issues.

“We strongly believe that RBC’s proposed acquisition offers HSBC’s Canadian clients the best possibility for continuity and stability while providing them with innovative made-in-Canada international banking solutions and advanced digital capabilities,” a representative for RBC stated.

An effort to purchase competitor Bank of Montreal by RBC occurred in the early 1990s, the last time a deal of this magnitude was tried in Canada. Regulators prevented that acquisition.

As banks seeking expansion prospects aim to expand into the United States, the highly regulated Canadian banking sector is active in mergers and acquisitions.