Originally published in Blakes Bulletin on Competition, June 2007
On June 12, 2007, the Competition Bureau held its Stakeholder Consultation on Fees and Service Standards meeting in Toronto. It was attended by senior officials from the Bureau’s Merger Branch, along with stakeholders from various trade associations, corporations and the private bar. Blake, Cassels & Graydon LLP attended the meeting.
The Bureau addressed a wide range of merger-related topics. Stakeholders were given an opportunity to provide suggestions to the Bureau regarding areas for possible improvement, particularly with respect to procedures for merger review. Suggestions by stakeholders for future reform or legislative amendment included the following.
Section 11 Orders
Under section 11 of the Competition Act, the Bureau can apply to a court for an order requiring a private party to provide documents and information. Stakeholders expressed concern that there have been instances where orders have been drafted too broadly, thereby imposing a burdensome obligation on private parties. Of particular concern are situations where these orders are issued to third parties who have nothing to gain from the merger but nevertheless must expend a significant amount of time and resources to comply. Stakeholders suggested that the Bureau should work with counsel of the intended targets of orders in advance of their issuance in order to facilitate reasonable and appropriate production requests.
Fee and Service Standards Handbook (FSSH)
The FSSH describes the Bureau’s procedures in a number of areas, including mergers. With respect to mergers, stakeholders pointed out that the FSSH should be updated to reflect the Bureau’s current procedures. For example, it was pointed out that the FSSH does not reflect the Bureau’s practice of making market contacts in all but exceptional cases. Stakeholders noted that there are other similar examples where the FSSH would benefit from an update.
Complexity Designations and Timing
According to the procedures outlined in the FSSH, the Bureau designates mergers as being either “non-complex”, “complex” or “very complex”. Based on this designation, the Bureau will endeavour to complete its review within 14 days, 10 weeks or five months, respectively. These are not statutory waiting periods. The statutory waiting periods established under the Competition Act are 14 days where a short-form notification has been filed and 42 days where a long-form notification has been filed. Stakeholders expressed concern that the Bureau’s designations are too imprecise and that the Bureau has developed a practice of working towards completing its review within the non-statutory complexity designation periods rather than the statutory waiting periods under the Competition Act.
Stakeholders recommended that the Bureau consider reinvigorating its previous practice of publishing interpretative guidelines concerning the notification rules under Part IX of the Competition Act.
Certain stakeholders recommended that the filing fees should be modernized. For example, it was suggested that different fee levels should be charged depending on the complexity of a particular review. Other participants suggested that mergers involving certain types of industries, such as financial institutions and real estate, should be exempted from the fee obligation – and possibly also from the notification requirements – because of the high frequency of transactions and the low likelihood of any material competition concerns arising in these areas.
The Bureau noted that it would consider possible amendments to the Competition Act, such as to modernize the definition of an affiliate and to confirm that the same rules that allow for the triggering of the statutory waiting period in the case of an unsolicited offer involving a corporation should apply in the same manner where the target is an income trust. As an interesting side point, it was brought to the Bureau’s attention that there is no clear basis upon which an acquisition of an income trust is even covered by the notification regime. The Bureau took this under advisement and indicated that it would consider this point further.
Overall, the consultation process was a success. The Bureau confirmed its continuing desire of making the merger review process more predictable and transparent.
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 Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Please join members of the Blakes Commercial Real Estate group as they discuss five key provisions of a commercial real estate purchase agreement that are often the subject of much negotiation but are sometimes misunderstood.
Emotional culture is influenced in great part by the mindset and actions of leadership, although employees also play more of a role than they may realize in creating the culture that exists in the group.
The session will be led by Dr. Robert Brooks, an award-winning author and psychologist. In his presentation, Dr. Brooks will describe the mindset and realistic practices of leaders and staff that help to nurture and sustain a culture characterized by positive emotions, satisfying, respectful relationships, a sense of meaning and ownership for one’s work, and enhanced job performance. Examples will be offered to illustrate strategies for developing a positive emotional culture in an organization.
Join leading lawyers from the Blakes Pensions, Benefits & Executive Compensation group as they discuss recent updates and legal developments in pension and employee benefits law as well as strategies to identify and minimize common risks.
The Canadian Competition Bureau issued a template document for use as a form of Consent Agreement, to be filed with the Competition Tribunal to resolve concerns the Bureau may have with proposed mergers.
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).