On February 3, 2014, the Federal Court of Appeal (FCA) ruled
that the Competition Tribunal (Tribunal) erred in dismissing the
abuse of dominance case brought by the Commissioner of Competition
(Commissioner) against the Toronto Real Estate Board (TREB). The
FCA's ruling hinged on its finding that the Tribunal
incorrectly interpreted its 2006 decision in Canada
(Commissioner of Competition) v. Canada Pipe Co. and,
consequently, the application of the abuse of dominance provisions
of the Competition Act (Act). Accordingly, the FCA sent
the Commissioner's application back to the Tribunal for
The Commissioner brought an abuse of dominance application under
subsection 79(1) of the Act against TREB, a trade association, on
the basis that TREB restricts the manner in which its member real
estate agents can disseminate information from the multiple listing
service (MLS) it controls. More specifically, the Commissioner
alleges that members cannot post MLS data online, which the
Commissioner alleges has the effect of substantially lessening
On April 15, 2013, the Tribunal dismissed the Commissioner's
application, without considering the merits, on the basis that
subsection 79(1) of the Act cannot apply to TREB because it does
not compete with its members. The Tribunal concluded that because
TREB does not compete with its members, TREB's rules cannot
have an intended negative effect on a "competitor," as
required by Canada Pipe.
For more detail on the original Tribunal decision in this case,
please see our
The FCA disagreed with the Tribunal's interpretation of
Canada Pipe as requiring the anti-competitive practice
described in paragraph 79(1)(b) of the Act to be directed against a
"competitor of the person who is the target of the
Commissioner's application." The FCA found that, given its
factual context, its decision in Canada Pipe did not
intend to preclude abuse of dominance orders against persons who
control a market "otherwise than as a competitor."
By way of example, the FCA noted the Commissioner's argument
that a person who does not compete in a market could nevertheless
control that market by controlling a significant input to
competitors in the market, or by making rules that effectively
control the business conduct of those competitors.
Without ruling on the facts alleged by the Commissioner and TREB
(since the Tribunal's decision was based on a matter of law and
did not deal with the facts), the FCA sent the case back to the
Tribunal for reconsideration.
The FCA decision in TREB casts uncertainty over who can
be the subject of an abuse of dominance application by the
Commissioner. It suggests, at a minimum, that trade associations
can be targets of abuse of dominance cases. The uncertainty created
by this decision is troublesome, particularly in view of the fact
that administrative monetary penalties (AMP) of up to $10
million are now available in abuse of dominance cases. On its
reconsideration of the case, it would be beneficial for the
Tribunal to provide guidance on this issue.
The Commissioner of Competition addressed innovation, enforcement and policy initiatives at the Competition Bureau in his keynote speech, "Strengthening Competition: Innovation, Collaboration and Transparency."
Used car listing website operator CarGurus Inc.'s attempt to force rival Trader Corporation to supply it with vehicle listing data has encountered a dead end as the Competition Tribunal denied it leave to commence a private application under several provisions of the Competition Act.
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