In the recent Speech from the Throne on November 19, 2008,
entitled Protecting Canada's Future, the Canadian
government outlined its plans to amend Canada's competition and
investment laws. The Government stated that, in the
interest of expanding investment and trade, it will proceed with
legislation to modernize the competition and investment laws by
implementing many of the recommendations of the Competition Policy
Review Panel. While the Government has yet to announce which of the
Panel's recommendations will be followed, the boldly titled
Panel report Compete to Win (June 2008) provides no
shortage of options among its 65 recommendations for reforms aimed
at increasing Canada's ability to attract foreign investment
and boost productivity growth.
The Panel recommended numerous substantial amendments to the
Investment Canada Act, including:
Raising the minimum threshold for reviewable
transactions so that only foreign investments in Canada of a
very significant size are subject to review and Ministerial
Eliminating special thresholds for certain segments
such as financial services, transportation services (including
pipelines) and uranium mining which result in all but the smallest
foreign investments being subject to review and Ministerial
Changing the base assumption to favour allowing the
investment unless the Minister is satisfied that a proposed
transaction would be "contrary to Canada's national
interest", compared to the current test which requires foreign
investors to show that the proposed transaction would be of
"net benefit" to Canada.
The Panel recommendations regarding the Competition Act
were more in the nature of fine-tuning but included a number of
Making hard-core cartel conduct (e.g., price-fixing, market
and customer sharing, output restrictions among competitors) a per
se criminal offence as in the United States, with other
anticompetitive agreements being subject to civil
Repealing criminal provisions dealing with price
discrimination, promotional allowances and predatory pricing, and
decriminalizing resale price maintenance.
Providing the Competition Tribunal with a new power to
impose administrative monetary penalties for violations of the
civil "abuse of dominance" provisions.
Harmonizing the merger notification process with the United
Increasing the financial thresholds which trigger a
pre-merger notification requirement.
Although the Government has yet to indicate which reforms it
will pursue over the coming year, certain amendments are less
contentious than others. One thing is clear: the business and legal
communities have a keen interest in the outcome and should be
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