Canada: Canada Post Monopoly On International Mail Upheld

Last Updated: October 2 2006
Article by Mark C. Katz

The Ontario Court of Appeal (the "Court of Appeal") has affirmed a lower court decision holding that Canada Post’s monopoly ("exclusive privilege") extends to collecting and/or transmitting letters within Canada for the purposes of delivery to foreign destinations outside of Canada.1 The result is to prohibit other businesses from competing against Canada Post in providing international mail services in Canada.


Canada Post sued to prohibit Key Mail Canada Inc. and Key Mail International Inc. (collectively, "Key Mail") from providing outbound international mail services in Canada. These services consist of collecting letter mail and other printed materials in Canada and arranging for delivery to points outside of Canada. Canada Post claimed that Key Mail’s international mailing operations infringed section 14 of the Canada Post Corporation Act (the "Act"), which grants Canada Post "sole and exclusive privilege of collecting, transmitting and delivering letters to the addressee thereof within Canada".2 Key Mail denied this infringement, arguing that section 14 prohibits the collection and transmission of letters in Canada only to the extent they are to be delivered to Canadian addressees as opposed to addressees outside Canada.

Canada Post brought a motion to have its action decided without trial on a question of law, namely the correct interpretation of section 14 of the Act (this is akin to a motion for summary judgment). The motions judge, Carnwath J. of the Ontario Superior Court of Justice, ruled in favor of Canada Post. Carnwath J. relied on a principle of statutory interpretation in Canadian law that the French and English versions of a statute are equally authoritative, and that if one version is ambiguous but the other unambiguous, the unambiguous meaning should be adopted as the common meaning for both versions. In accordance with this principle, Carnwath J. looked to the French-language version of section 14, and held that it clearly indicated Parliament’s intention to grant Canada Post a monopoly over three distinct activities: (i) the collection of letters within Canada, (ii) the transmission of letters within Canada, and (iii) the delivery of letters to addressees within Canada. Adopting that as the common meaning for section 14, Carnwath J. held that Key Mail had contravened Canada Post’s exclusive privilege, because it both collected and transmitted letters within Canada, even though it delivered these letters to addressees outside of Canada. Carnwath J. also held that his interpretation of Canada Post’s exclusive privilege was consistent with the purpose of the Act, which is to ensure the provision of a universal postal service at a reasonable cost.

Decision Of The Court Of Appeal

On appeal by Key Mail,3 the Court of Appeal agreed with Carnwath J.’s interpretation of section 14 of the Act. In a unanimous judgment, the Court of Appeal held that, while the English version of section 14 is ambiguous, the French version makes it clear that the Act gives Canada Post a monopoly, within Canada, over the collection, transmission, and/or delivery of letters to their addressees.

The Court of Appeal also agreed that this interpretation is consistent with the corporate objects of Canada Post, as set out in the Act, which include the need to provide "basic customary postal service" on a "selfsustaining financial basis". The Court of Appeal accepted that Canada Post’s monopoly over all aspects of "the lucrative letter mail business" must be protected in order for it to provide universal postal service throughout Canada in a financially viable way.

The Court of Appeal also noted that its understanding of section 14 is in line with other provisions of the Act, particularly the section which makes it an offense to violate Canada Post’s exclusive privilege: 56. Every person who, in violation of the exclusive privilege of the Corporation under section 14, collects, transmits or delivers to the addressee thereof, or undertakes to collect, transmit or deliver to the addressee thereof, any letter within Canada, or receives or has in his possession within Canada any letter for the purpose of so transmitting or delivering it, commits an offense in respect of each such letter. [Emphasis added by the Court of Appeal]

The Court held that there "is no question" that this section creates an offense with respect to the discrete activities of collecting, transmitting and delivering letter mail within Canada, which means that the exclusive privilege as set out in section 14 must be read in that way as well.

Among the other arguments made in support of the appeal was that Carnwath J.’s decision was contrary to a rule of interpretation that a statute creating monopoly rights must be strictly construed against the monopolist. The Court of Appeal rejected this argument, holding that even if the rule applied in Canada, which is not at all certain, it would not govern in a situation where the language of the provision is clear and fits "harmoniously" with the scheme and object of the legislation.

The Court of Appeal also rejected the submission that a Canada Post monopoly over international mail is inconsistent with the Canadian Competition Act. The Court of Appeal stated that Canada Post could not be said to be competing unfairly if it is operating pursuant to its statutory authority as granted by Parliament. (Although not expressly referred to by the Court, this is the same result that would follow under the common law "regulated conduct doctrine", which provides a form of immunity from enforcement under the Competition Act to persons engaged in conduct that is directed or authorized by other validly enacted legislation.) Finally, the Court of Appeal rejected the argument that the meaning it ascribed to section 14 does not comport with international postal conventions. The Court of Appeal noted that these conven conventions specifically state that they do not derogate from the domestic legislation of signatory countries.


The Key Mail decision eliminates a significant competitive threat to Canada Post, and thus an important competitive option for Canadian businesses (including, perhaps ironically, the other federal government departments that used the international mailing services of Canada Post’s competitors).

The Canadian situation may be contrasted with that in Europe, where the European Commission issued a directive in 2002 requiring that all outgoing cross-border mail be opened to competition as of January 1, 2003 unless deemed necessary to maintain universal postal service within a jurisdiction. This directive was part of an ongoing process that aims to completely liberalize postal services in Europe by 2009. A majority of EU Member States have now complied with the directive and permit competition in the provision of outgoing international mail services.


1. Canada Post Corporation v. Key Mail Canada Inc., et al (2005), 77 O.R. (3d) 294 (C.A.). Leave to Appeal to the Supreme Court of Canada was denied without reasons on December 22, 2005.

2. The meaning of "letter" for these purposes is specifically defined in the Act.

3. Also participating in the appeal was another international mailer operating in Canada that had been granted leave to intervene in support of Key Mail’s position


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

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

Mark C. Katz
In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
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
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
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 (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

To Use 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.


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.


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