During 2013, Canadian courts, including the Competition Tribunal
(Tribunal), issued more substantive decisions in competition
matters than in any year in the past decade. There were also
significant developments in foreign investment law in Canada,
including a focus on the treatment of investments by state-owned
enterprises. 2013 also saw the first known rejection of a
transaction under Canada's national security regime. Here are
the highlights, including what to watch for in 2014:
Criminal Matters: A corporation was found
guilty of price-fixing on the basis of its general manager's
participation in the cartel, confirming that criminal liability can
attach to a corporation by virtue of the actions of employees who
are not the "directing minds" of the corporation. (R.
v. Pétroles Global inc., August 2013)
Abuse of Dominance: The Federal Court of
Appeal ruled that the Tribunal erred when it dismissed the abuse
application by the Commissioner of Competition (Commissioner)
against the Toronto Real Estate Board (TREB). The decision casts
uncertainty over who can be the subject of an abuse of dominance
application. (Commissioner of Competitionv. Toronto
Real Estate Board, February 2014)
Price Maintenance: The Tribunal dismissed the
Commissioner's application and ruled that price maintenance
under the Competition Act (Act) requires that the product
sold by the person influencing upward or discouraging the reduction
of the product's price be resold by the person's customer.
(Commissioner of Competition v. Visa Canada Corporation and
MasterCard International Incorporated, September 2013)
Deceptive Marketing Practices: The
Commissioner's application against a wireless carrier for
misleading advertising was largely dismissed. This decision also
addressed the constitutionality of administrative monetary
penalties (AMPs) and the standard to be applied under the general
misleading advertising provisions in the Act. (Commissioner of
Competition v. Chatr Wireless Inc., August 2013)
Class Actions: The Supreme Court of Canada
affirmed the right of indirect purchasers to assert damage claims
for violations of the Act, while confirming its rejection of the
"passing on" defence. (Pro-Sys Consultants Ltd. v.
Microsoft Corporation, Sun-Rype Products Limited v. Archer
Daniels Midland Company and Infineon Technologies AG v.
Option consommateurs, October 31, 2013)
Mergers: The Federal Court of Appeal upheld
the Tribunal's decision in a non-notifiable transaction
requiring a landfill operator to divest a hazardous waste landfill
on the ground that the acquisition would substantially prevent
competition. (Tervita Corporation et al v. Commissioner of
Competition, February 2013)
Investment Canada Act: The Canadian
government blocked the proposed $520 million acquisition of the
Allstream division of Manitoba Telecom Services Inc. by Accelero
Capital Holdings on national security grounds (October 2013).
What to Watch for in 2014:
Industry Focus: More enforcement actions and
advocacy interventions by the Competition Bureau (Bureau) in the
digital economy and health care industries.
Criminal Matters: More contested price-fixing
and bid-rigging prosecutions.
Misleading Advertising: More enforcement
action with respect to misleading price representations.
Class Actions: Direction on the appropriate
methodology and expert evidence required at the certification stage
to establish harm on a class-wide basis and to demonstrate the
passing on of alleged overcharges at all levels of the supply
Investment Canada Act: Significant
increase to thresholds that trigger a review of acquisitions by
non-state-owned enterprises will likely occur in 2014.
The threshold for advance review and Ministerial approval of certain direct foreign acquisitions of control of Canadian businesses under the Investment Canada Act is subject to annual indexing for inflation.
On March 29, 2007 the Competition Tribunal denied the Commissioner of Competition’s application under section 100 of the Competition Act to prevent closing of the proposed acquisition of Lakeport Brewing Income Fund by Labatt Brewing Company Limited for a period of 30 days so that the Commissioner could finish her examination.
The U.S. Federal Trade Commission (FTC) has announced that it will release tomorrow the annual revisions to the notification and filing fee thresholds of the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
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