Canada: Competition Law And Associations: A Refresher

While it is generally recognized that associations can serve many pro-competitive purposes, they can also, in some cases, serve as a forum for anti-competitive activity. Most recently, in 2010, Canada's Commissioner of Competition settled a case with the Canadian Real Estate Association regarding alleged anti-competitive practices by the association that were considered to be limiting consumer choice and preventing innovation in residential real estate services.1

At a high level, competition laws attempt to define rules that establish the limits of legitimate business conduct, and set out penalties that apply when those limits are crossed. In view of recent amendments that introduced significantly higher fines and prison terms for violations of Canada's Competition Act (the Act), it is more important than ever for associations to consider proactive measures to ensure compliance. The following sample list of "do's and don'ts" offers tips regarding typical association activities that have the potential to raise concerns under the Act:

Do Review Association Policies: Associations maintain a certain level of discretion in determining which firms to admit as members. However, membership criteria, rules, policies, by-laws or other conduct that serve to exclude firms from the association and place that firm at a competitive disadvantage may raise concerns under the Act. Membership should be available to any party in the industry who is interested in joining the association, and associations should ensure that membership criteria and any related policies and rules are based on transparent, objective criteria and enforced in a nondiscriminatory manner.

Do Not Stray From Approved Meeting Agendas: Meetings among members of an association are often viewed as fertile ground for anti-competitive conduct because they involve gatherings of competitors. In this regard, the Act includes, among other things, a provision that prescribes criminal sanctions, including steep fines and/or prison terms for competitors who agree to fix prices, allocate markets or restrict output for the goods or services they offer. Accordingly, meetings should be conducted pursuant to clear and unambiguous agendas, ideally that have been approved in advance by legal counsel, and that refrain from discussing competitively sensitive issues or information (such as individual sales, production volumes or capacity; pricing data and price-related information, including planned promotional discounts or rebates; the identities of customers and the specific geographic markets in which the firm operates; future business strategies; and information about upcoming bids or how a firm determines its bid). Detailed minutes should be recorded that list not only the names of those in attendance, but also the issues discussed. If a member insists on discussing matters outside of the confines of the agenda that could lead to violations of the Act, the meeting should be stopped. Members should refuse to participate further in the meeting and ensure that their departure – and the reason for the departure – is noted in the meeting minutes.

Do Place Strict Limitations on Exchange of Information: Among the services that associations typically provide to their members is the compilation of certain data from each of its members to perform, for example, benchmarking exercises or identify industry trends. However, associations must be careful not to be used as a forum for the exchange of competitively sensitive information. In such cases, if the information exchange amounts to an explicit or tacit agreement to fix prices, allocate markets or restrict output, the activity could constitute a criminal offence. The exchange could also, for example, raise issues under the bid-rigging provisions of the Act if competitors use the information to collaborate in preparing bids. Associations must consider any exchanges of information very carefully and may wish to involve an independent third party who could receive and aggregate the data so that individual submissions are not identifiable by other members or attributable to any particular member.

Do Not Encourage Informal Interactions: While formal, scheduled association meetings take place in a manner that can usually be controlled and supervised, associations also provide a forum for unstructured, informal interactions among members. Whether these gatherings take place in conjunction with regular meetings or otherwise, they must be treated with a degree of caution similar to that of regular meetings if there is a risk of exchange of competitively sensitive information. The association should be vocal in dissuading members from engaging in these types of informal meetings, and must be prepared to report this conduct to the appropriate representative. Given the possibility that reference to the informal meeting could become part of the record through, for example, an email between members, the association should also maintain its own record of the conduct and the actions taken to report and address it.

Do Establish a Compliance Program: Associations should invest the time and effort required to prepare comprehensive policies that ensure compliance with the Act, and these should be disseminated throughout the association and to association members. A good compliance program also helps to avoid other issues associated with violations of the Act, including the negative publicity that can be generated by an investigation by the Competition Bureau, which can impact the association's ability to attract and retain new members.

Footnote

1. http://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03196.html

About BLG



The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
Dale & Lessmann LLP
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Dale & Lessmann LLP
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions