On November 3, 2011, the Competition Tribunal issued a decision refusing to
grant summary disposition to the vendor respondents in Commissioner of Competition v. CCS
Corporation, thus confirming dissolution as a
possible remedy in the case. The proceedings centre on the
Commissioner's application challenging CCS Corporation's
completed acquisition of Complete Environmental Inc., which owns
the Babkirk Secure Landfill located in northeastern British
Columbia, on the basis that the transaction is likely to
substantially prevent competition for the disposal of hazardous
waste in northeastern British Columbia (for more on the case, see
our earlier post).
Because the proceedings deal with a completed transaction, the
vendor respondents maintain that they are only implicated to the
extent that the Tribunal would order dissolution as a remedy.
Consequently, the vendor respondents moved to have the
Commissioner's application dismissed against them on the ground
that there was no genuine basis for the Tribunal to order
dissolution. They argued that dissolution was an overly broad and
punitive measure, and that divesture would be an effective and more
appropriate remedy (assuming that the Commissioner is able to prove
that the acquisition would substantially prevent competition). On
the other hand, the Commissioner maintained that dissolution might
be a necessary remedy, and argued that the application should be
allowed to proceed to a hearing in order to determine several
factual issues that would impact on the viability of either
divesture or dissolution as an appropriate remedy.
Justice Simpson stated that in order for the Tribunal to grant
the respondents' motion, the respondents would have to have
demonstrated that there was no genuine basis for the Commissioner
to seek dissolution as a remedy. This required them to show that
divesture was an effective and realistic remedy. While divesture is
theoretically an effective remedy, Justice Simpson found that the
lack of any identified buyer in this case made it potentially
unrealistic. Moreover, she accepted the Commissioner's argument
that evidence might be adduced at the hearing which would speak to
the relative effectiveness and intrusiveness of dissolution and
Justice Simpson was also unconvinced by the Respondent's
contention that the Commissioner had failed to explicitly allege
dissolution as the only effective remedy. It was
sufficient that the Commissioner had claimed dissolution as an
alternative remedy, to be used if it was the only remedy available
to adequately address the substantial prevention of competition.
Consequently, Justice Simpson kept the door open to the possibility
of dissolution, concluding that if the Commissioner was successful
on the merits it would be for the Tribunal to weigh the evidence
for and against the two remedies.
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The Canadian Competition Bureau issued a template document for use as a form of Consent Agreement, to be filed with the Competition Tribunal to resolve concerns the Bureau may have with proposed mergers.
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