Originally published in Blakes Bulletin on Competition,
Antitrust & Foreign Investment, June 2010
What? The Competition Bureau published its
draft Fee and Service Standards Handbook For Merger-Related
Matters. According to the Bureau, the draft Handbook is
intended to provide insight into how, under the amended merger
review process enacted on March 12, 2009, the Bureau determines the
length of time it will need to review a merger transaction (the
service standard). The length of time, according to the Bureau,
depends on the complexity of the transaction under consideration.
To view the draft Handbook, click here.
When? The draft Handbook was published for
comment on May 31, 2010. Interested parties may provide comments on
the draft Handbook until August 2, 2010.
Commentary. Notwithstanding the new merger
regime adopted in Canada on March 12, 2009 (which creates an
initial statutory waiting period of 30 days for the review of
mergers), the draft Handbook suggests that "complex" and
"very complex" transactions could require up to 60 days
and 120 days, respectively, for the Bureau to complete its
substantive review of a proposed transaction.
With respect to mergers in which the Commissioner of Competition
(Commissioner) issues a supplementary request for information
(SIR), the draft Handbook provides a 30-day service standard,
within which the Bureau endeavours to complete its review after
certification, which aligns with the 30-day statutory waiting
period that is triggered upon filing a materially complete SIR
response. A SIR should only be issued in cases where the Bureau
requires additional information. These cases are likely to be those
the Bureau feels are "very complex". Thus, it is not
clear in the draft Handbook how the "very complex"
120-day time-frame relates to the 30-day SIR time-frame; this issue
ought to be clarified in the final version of the Handbook.
The draft Handbook also introduces a "pull and
re-file" policy in respect of notification filings, arguably
bringing the Canadian system more in line with a practice which has
emerged in the U.S. in this regard.
It should be noted that notwithstanding the above draft service
standard policy, the Competition Act actually contemplates that
parties may close a transaction immediately 30 days after
submitting an initial merger filing, unless a SIR (which is
equivalent to a "second request" in the United States) is
issued, in which case the parties may close 30 days after
compliance with the SIR regardless of the status of the
Commissioner's review. This is the practice in the United
States. It had been hoped that the new law, which was supposed to
bring Canada in line with the United States, would lead to almost
all mergers being cleared within the initial 30-day period, and
with only a few being subject to the second request or SIR process.
In this sense, the proposed time-frames in the draft Handbook
remain misaligned with the statutory framework. No doubt this will
form part of the commentary on the draft Handbook in the next two
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guide to the subject matter. Specialist advice should be sought
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