On February 3, 2014, the Federal Court of Appeal overturned the
Competition Tribunal's 2013 decision dismissing the
Commissioner of Competition's abuse of dominance allegations
against the Toronto Real Estate Board (TREB) and referred the case
back to the Tribunal. In so doing, the Court held that the
Competition Act's abuse of dominance provisions could
potentially apply to a person that controls a market even if that
person does not compete in that market. While the long-term
effects of the decision remain to be determined, trade associations
and companies that may be considered to control a market in which
they do not compete should carefully consider the impact of the
decision on their policies and practices.
TREB is an association comprising most of the realtors in the
Greater Toronto Area. The Commissioner challenged a TREB rule
restricting its members from posting certain historical data on
virtual office websites, alleging that the rule substantially
lessens or prevents competition in the market for residential real
estate brokerage services.
The Competition Tribunal dismissed the case on
the grounds that the abuse of dominance provisions of the
Competition Act did not apply to TREB in this context because TREB
did not compete in the market that it was alleged to control
— a requirement that the Tribunal stated was established in
an earlier Federal Court of Appeal decision (Canada Pipe). In
its February 3 decision, the Court of Appeal held that the Tribunal
had misinterpreted the Canada Pipe decision and that the abuse of
dominance provisions could potentially apply to a person that
controls a market even if that person does not compete in that
It remains to be seen how the Tribunal will now decide the TREB
case on the specific facts before it. Under the Competition
Act's abuse of dominance provisions, the Tribunal may exercise
its discretion to issue an order only where the Commissioner has
established not just control of the relevant market but also that
the respondent is engaging in or has engaged in a practice of
anti-competitive acts and that those anti-competitive acts have
resulted in or are likely to result in a substantial lessening or
prevention of competition in a market. The Tribunal will need
to determine whether all of these requisite elements have been
More broadly, it also remains to be seen how the abuse of
dominance provisions might be applied in practice to a person that
does not compete in the relevant market. The TREB case involves a
trade association that the Commissioner alleges controls a market
in which it does not actually compete. However, it is not
clear what other types of firms or entities the Commissioner or the
Tribunal might consider to control a market in which they do not
compete. Until more clarity is obtained from the
Commissioner, the Tribunal or the courts, large customers or
suppliers, for example, that might be considered to possess
significant market power in an upstream or downstream market may be
well advised to consider the potential application of the abuse of
dominance provisions to any of their policies or practices that are
likely to have the effect of excluding competitors from such a
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.
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