Copyright 2008, Blake, Cassels & Graydon LLP

Originally published in Blakes Bulletin on Competition Law May, 2008

On April 28, 2008, Bill C-454, An Act to amend the Competition Act and to make consequential amendments to other acts, received second reading in the House of Commons and was referred to the Standing Committee on Industry, Science and Technology. The bill was introduced by Roger Gaudet, a member of the Bloc Québécois and the Member of Parliament for Montcalm, Québec, on June 7, 2007.

Significant aspects of the proposed amendments to the Competition Act include the following:

  • The requirement that a conspiracy "unduly" prevent or lessen competition would be removed, and a defence would be added for agreements that are reasonably necessary to attain gains in efficiency or encourage innovation. The maximum fine under the conspiracy provision would be increased from C$10-million to C$25-million.

  • Private litigants would be allowed to seek leave from the Competition Tribunal (the Tribunal) to bring applications under an expanded abuse of dominance provision of the Competition Act. Currently, only the Commissioner is empowered to enforce the provision. The Tribunal would be empowered to impose administrative monetary penalties for contraventions of the abuse of dominance provision of up to C$10-million for an initial order and C$15-million for each subsequent order, or up to the amount of gross revenues earned by the corporation as a result of that individual or corporation engaging in a practice of anti-competitive acts.

  • The Tribunal would be empowered to award damages to private litigants in cases involving the refusal to deal, exclusive dealing, tie selling, market restriction, and abuse of dominance provisions of the Competition Act. Currently, the only remedy available to a successful litigant is a prohibition order.

  • The Commissioner would be empowered to initiate inquiries into, and use its broad investigative powers relating to, entire industry sectors.

  • The price discrimination, predatory pricing, and promotional allowances provisions of the Competition Act would be repealed.

  • Maximum penalties available under the civil deceptive marketing practices provisions of the Competition Act would be significantly increased. In the case of an individual, the penalty would be increased from C$50,000 to C$750,000 for an initial order and from C$100,000 to C$1-million for each subsequent order. In the case of a corporation, the penalty would be increased from C$100,000 to C$10-million for an initial order and from C$200,000 to C$15-million for each subsequent order. The Court would also be empowered, in its discretion, to impose an administrative monetary penalty exceeding these statutory maximums, but not exceeding the gross revenues earned by the individual or corporation as a result of the deceptive marketing.
  • Also under the civil deceptive marketing practices provisions of the Competition Act, the Court would be empowered to order that the impugned individual or corporation pay restitution to those customers who purchased the products that were the object of the deceptive marketing practice. The amount to be paid could not exceed the amount originally paid by the customers for the products. Also, restitution would be available only to end-users of the products and, specifically, would not be available to those individuals or companies that purchased the products for resale or distribution.

Given that Bill C-454 was introduced as a Private Member's Bill, it is far from certain whether it will ultimately be passed into law especially given that the Competition Policy Review Panel, established by the federal government in July 2007, has been tasked with reviewing key provisions of the Competition Act and is scheduled to report back to the government by June 30, 2008. However, Bill C-454 provides an interesting glimpse into the types of amendments to the Competition Act that at least some Members of Parliament may like to see in the future.

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