On May 29, the Competition Bureau (Bureau) announced that the
Competition Tribunal (Tribunal) reached a decision in Commissioner
of Competition v . CCS Corporation. According to the Bureau's
press release, the Tribunal ordered CCS Corporation (CCS) to divest
the Babkirk hazardous waste landfill site, thereby refusing to
grant the Bureau's requested primary remedy to dissolve the
The Commissioner was therefore successful in demonstrating that
the merger was anticompetitive, but not in convincing the Tribunal
that dissolving the merger was the only appropriate remedy in this
case, as had been argued in the context of a preliminary
This is the first time a merger is challenged on the grounds
that it will result in a substantial prevention, as opposed to a
substantial lessening, of competition. The Tribunal's decision
also provides an important reminder that due diligence is critical
in mergers, even in circumstances where notification to the Bureau
is not required, as mergers may be challenged for up to one year
after their completion.
In January 2011, for the first time since 2005, the Commissioner
of Competition (Commissioner) applied to the Tribunal for an order
dissolving CCS's acquisition of Complete Environmental Inc.
(Complete Environmental) or, in the alternative, requiring the
divesture of assets to a purchaser that had been approved in
advance by the Commissioner.
CCS was the only owner and operator of the other secure landfill
in North-Eastern British Columbia. Complete Environmental obtained
regulatory approval authorizing the conversion of the Babkirk
landfill into a "secure landfill" for hazardous waste,
which would have allowed a new entrant in the area.
However, Complete Environmental did not enter the market, but
rather sold the Babkirk landfill site to CCS. The acquisition,
which was not notifiable under the Competition Act, prompted a
Bureau's investigation, which resulted in the
Commissioner's allegations that the merger would substantially
prevent competition for the disposal of hazardous waste in
North‑Eastern British Columbia.
The vendors filed a preliminary motion, arguing that the
dissolution of the transaction sought by the Commissioner was not
the appropriate remedy. The motion was dismissed among other
reasons because the vendors had failed to demonstrate that
divestiture would be an effective remedy in this case. The Tribunal
specifically pointed out that in the absence of a potential buyer,
the effectiveness of the divestiture as a remedy had not been
The Tribunal's reasons have not yet been made public, but
when released, they will be of interest, as they will likely
provide insight into several novel issues in Canadian competition
the circumstances in which the acquisition of assets that are
not part of an operating business will be considered to result in a
substantial "prevention" of competition (as opposed to a
"lessening" of competition resulting from the acquisition
of an operating business);
the factors considered by the Tribunal in exercising its
discretion to order the divestiture of the landfill site as a
remedy, as opposed to ordering the dissolution of the merger, the
primary remedy sought by the Commissioner. More specifically, it
will be interesting to see whether the Tribunal required the
Commissioner's advance approval of the purchaser prior to
ordering the divestiture.
We will publish a more detailed report on the Tribunal's
reasons upon their release, which should occur in the near
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