Last week, the Competition Tribunal (Tribunal) issued a summary
of its decision in the Commissioner of Competition's
(Commissioner) long-running abuse of dominance case against the
Toronto Real Estate Board.
This case has broadened the scope of the type of conduct that
can constitute an "abuse of dominance" under Canadian
law, but the limits of what constitutes abusive conduct have yet to
On April 27, 2016, the Competition Tribunal issued the outcome
and a summary of its decision in Commissioner of Competition v.
Toronto Real Estate Board, holding that TREB had abused its
dominant position and lessened competition substantially in the
supply of residential real estate brokerage services.
TREB is a trade association of real estate brokers in Toronto
that operates a password-protected Multiple Listing Service (MLS)
to which its members have access. TREB imposed certain restrictions
on its members' use of information from the MLS, including how
it is publicly disseminated. The Commissioner brought an
application against TREB in May 2011, alleging that TREB
"controlled" the supply of MLS-based brokerage services
in Toronto and that its restrictions prevented brokers from
innovating in the types of brokerage services they were offering
(in particular, preventing the operation of Internet-based
brokerages). The Commissioner alleged that these restrictions
constituted an abuse of dominance.
TREB took the position that because it did not compete with its
members (i.e., the MLS was an input to its members, but not
competitive against its members), any restrictions TREB took that
affected its members could not be "directed at a
competitor" — an important requirement of the abuse of
dominance provision under an older Canadian case. In April 2013,
the Tribunal agreed and dismissed the Commissioner's
application for this reason. However, the Commissioner successfully
appealed in February 2014 to the Federal Court of Appeal (FCA). The
FCA's decision held that to constitute an anti-competitive
practice, conduct need not be directed at a competitor of the
person alleged to have abused its dominance. Instead, the abuse of
dominance provision was capable of broader application than argued
by TREB. The FCA sent the case back to the Tribunal for further
While the Tribunal has ruled in favour of the Commissioner, its
decision is not yet publicly available. The summary of the decision
released by the Tribunal confirms the Tribunal's conclusions
that (1) TREB controls the supply of MLS-based brokerage services
in Toronto; (2) TREB's restrictions constitute anti-competitive
acts directed at a competitor (even though TREB does not compete
with its members); and (3) TREB's restrictions are preventing
competition substantially, particularly as it concerns non-price
competition (i.e., impact on innovation, quality and range of
Interested observers will be keen to review the full decision
when it is released. Potentially the most important issue the
decision may address is the limiting principle of what constitutes
an anti-competitive act, a question that was generally left open by
the FCA. The Tribunal may have ruled narrowly, finding that
although trade associations do not compete with their members,
their circumstances are unique because a trade association is
composed of and controlled by its members. Alternatively, the
Tribunal may extend the scope of what constitutes an
anti-competitive act beyond these unique facts. The decision may
also offer guidance about how innovation and other qualitative
elements of competition are to be evaluated under Canadian law.
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