Canada: Antitrust/Competition & Marketing Group 2008 Year In Review - Criminal Matters And Other Competition Law Developments

Last Updated: July 23 2009
Article by Huy A. Do, Mark D. Magro and Neal J. Smitheman

This bulletin is the second in a series of bulletins on developments in competition and foreign investment review law during 2008.

Criminal Matters

  • Cases
  • New Bulletins and Guidelines
  • Policy Developments

Other Developments

  • Updated Information Bulletin on Corporate Compliance Programs
  • Draft Information Bulletin on Trade Associations
  • Departure of Sheridan Scott as Commissioner of Competition
  • Competition Policy Review Panel Report and Proposed Changes to the Competition Act
  • Competition Bureau's Follow-up Report on Generic Drug Competition



In terms of criminal matters, 2008 saw a number of new cases being brought by the Competition Bureau with criminal charges being laid and convictions being obtained. In keeping with announced Bureau priorities, the Bureau brought on domestic and international cartel cases, bid-rigging cases, as well as cross-border telemarketing and fraud cases.

In terms of cartel cases, the most notable was the Bureau's uncovering and prosecution of an alleged domestic cartel fixing retail gasoline prices in Quebec. To date, eight individuals and five companies have pleaded guilty in this matter, with fines totaling over $2.7 million. Of the eight individuals that pleaded guilty, four have been sentenced to terms of imprisonment totaling 44 months.

2008 also saw another conviction (by way of a guilty plea) in relation to the Bureau's investigation into an alleged international cartel fixing hydrogen peroxide prices. On November 21, 2008, Akzo Nobel Chemicals International BV pleaded guilty to a conspiracy offence under section 45 of the Competition Act and was fined $3.15 million.

On the telemarketing and fraud front, the Bureau's enforcement efforts resulted in criminal convictions and jail time, including significant jail time in the US for Canadian individuals extradited from Canada for their roles in cross-border telemarketing frauds.

New Bulletins And Guidelines

2008 was a busy year for the Bureau in terms of its issuance of new bulletins and guidelines, which included the following:

  • Draft Multi-level Marketing and Scheme of Pyramid Selling: Sections 55 and 55.1 of the Competition Act (April 1, 2008) (this bulletin was issued in final form in April 2009);1
  • Bid-Rigging: Awareness and Prevention On-line Tool (April 8, 2008);
  • Information Bulletin on Sections 15 and 16 of the Competition Act (re search and seizure) (April 25, 2008);
  • Draft Information Bulletin on Sentencing and Leniency in Cartel Cases (April 28, 2008) (a revised draft of the bulletin was released for further public consultation in March 2009);
  • Predatory Pricing Enforcement Guidelines (July 21, 2008); and
  • Draft Information Bulletin on Trade Associations (October 23, 2008).

Policy Developments

On the policy front, June of 2008 saw the release of the report of the Competition Policy Review Panel, which was established in the previous year by the Ministers of Industry and Finance. The final report, titled Compete to Win, recommended significant changes to the Competition Act.

These recommendations have been acted upon by the Harper Government with the passage of Bill C-10 on March 12, 2009.2 For further information, see our past bulletins on the Bill C-10 amendments and their implications for business.3

Also of significance was the release in August 2008 of the Gover Report which examined the Bureau's use of section 11 orders to obtain information and records in the course of its investigations. While the impetus for, and the principle focus of, the Gover Report was the use of section 11 orders in the context of the Bureau's civil merger inquiries, it also considered the use of such orders in the context of criminal inquiries. The Gover Report recommends that section 11 orders in furtherance of a criminal inquiry should not be sought against a person who is a suspect at the time of the section 11 application because it is questionable whether this would comply with sections 7 and 8 of the Canadian Charter of Rights and Freedoms.


Updated Information Bulletin On Corporate Compliance Programs

In October, the Bureau released an information bulletin on corporate compliance programs that updates a previous bulletin released in 1997.4 The updated bulletin covers compliance in respect of the Competition Act, and other Acts the Bureau is responsible for enforcing. The core elements of a credible and effective compliance program remain unchanged; namely: (i) senior management involvement and support; (ii) compliance policies and procedures; (iii) training and education; (iv) monitoring, auditing and reporting mechanisms; and (v) consistent disciplinary procedures. However, the updated bulletin offers more detailed guidance on how these core elements should be instituted and contains a corporate compliance program framework, a template certification letter for employees to sign, and a due diligence checklist.

The establishment of a credible and effective compliance program is important for a number of reasons, including the following:

  • it can be instrumental in the early detection and minimization of infractions;
  • it can be an important factor in establishing a due diligence defence; and
  • it may be considered a mitigating factor in reducing a penalty recommended by the Commissioner to prosecutors.

Draft Information Bulletin On Trade Associations

In October, the Bureau released a draft information bulletin on trade associations.5 As recognized by the Bureau, apart from the benefits trade association activities provide, they also can sometimes be a forum for anticompetitive conduct. The draft bulletin addresses the following activities that in certain circumstances can risk contravention of the Competition Act:

  • information sharing and collection;
  • association membership rules and criteria;
  • discipline of association members;
  • creation of fee guidelines by professional associations;
  • association advertising and restrictions on advertising by association members;
  • restrictions imposed by self-regulated associations;
  • use of voluntary codes of conduct; and
  • standard setting.

The draft bulletin elaborates on when the foregoing activity raises anticompetitive concerns, and identifies certain "best practices" for trade associations to follow. Chief among these practices is the recommendation that trade associations adopt a competition compliance program. The draft bulletin also contains best practices that should be considered when creating a compliance program for a trade association.

Departure Of Sheridan Scott As Commissioner Of Competition

In December, Sheridan Scott announced that she was stepping down after serving five years as Commissioner of Competition. Effective January 12, 2009 former Senior Deputy Commissioner of Competition Melanie L. Aitken was appointed as Interim Commissioner. A public selection process undertaken by the federal government will determine who the next Commissioner will be.

Competition Policy Review Panel Report And Proposed Changes To The Competition Act

In July 2007, as part of its long-term economic plan, Advantage Canada, the Conservative Government appointed the Competition Policy Review Panel to review Canada's competition and foreign investment policies. The panel released its final report, Compete to Win, in June: (the "Wilson Report").6 The Wilson Report offered a number of recommendations in respect of the Competition Act, the Investment Canada Act, and foreign ownership restrictions in relation to certain industries. Prior to the re-election of a Conservative minority government in October, the Conservatives announced plans to amend fundamental provisions in the Competition Act and Investment Canada Act, implementing many of the recommendations in Wilson Report. Most of these proposed amendments became reality after the passage Bill C-10 (see our discussion of Bill C-10 above).

Competition Bureau's Follow-Up Report On Generic Drug Competition

In November, the Bureau released its report Benefiting from Generic Drug Competition in Canada: The Way Forward as a follow-up to its October 2007 Generic Drug Sector Study.7 The 2007 study was initiated in response to several studies that found prices for prescription generic drugs to be higher in Canada relative to other countries. In the 2007 study, the Bureau found that while competition was strong in the supply of many generic drugs, the benefits from such competition were not reaching the Canadian public in the form of lower prices. A principal finding of the Bureau was that although the design of public and private drug plans allowed competitive rebates to be provided to pharmacies by manufacturers, there was little incentive for pharmacies to pass these savings on to plan sponsors.

The 2008 follow-up report provides an update to the framework for generic drug pricing in Canada, outlines recent drug plan developments, and offers recommendations for public and private drug plans to realize the benefits of greater competition.

The follow-up report recommends that public drug plans do the following:

  • introduce mechanisms (e.g. competitive tendering, competitive price monitoring, and sequential formulary listing) for reimbursing pharmacies for the true competitive cost of drugs;
  • separate the reimbursement for pharmacy services (e.g. patient counseling and dispensing drugs) from the reimbursement for drug costs;
  • provide incentives for the dispensing of lower-priced generic drugs in the place of their interchangeable brand products; and
  • participate in inter-provincial coordination of generic pricing and reimbursement policies to ensure that they promote and sustain effective generic drug competition.

The follow-up report's recommendations for private drug plans are as follows:

  • develop preferred pharmacy networks, whereby pharmacies compete to belong to a network by offering discounts off of drug wholesale prices to plan providers in order to increase their numbers of prescriptions;
  • promote greater use of mail-order pharmacies; and
  • provide patients with incentives to seek lower prices, e.g., by encouraging purchases through preferred provider networks.

For more information on the subject of this bulletin, please contact the authors.


1. The final bulletin is on the Bureau's website at

2. Bill C-10, An Act to implement certain provisions of the budget tabled in Parliament on January 27, 2009 and related fiscal measures, 2d Sess., 40th Parl., 2009 (assented to 12 March 2009).

3. "Investment Canada Act Amendments May Increase Foreign Investor Uncertainty" (May 2009),

"Substantial Changes to the Competition Act and Investment Canada Act Enacted – Businesses Must React" (March 2009),

"Dramatic Changes to Canada's Competition and Foreign Investment Review Laws Proposed in Bill C-10" (February 2009),

"Re-election of Conservative Government Brings Proposed Changes to Canadian Competition and Foreign Investment Laws Closer to Reality" (November 2008),

"Prime Minister's First Response to the Report of the Competition Policy Review Panel" (September 2008),

"Competition Policy Review Panel Proposes National Competitiveness Agenda"(July 2008),

4. The updated bulletin is available on the Bureau's website:

5. The bulletin is available on the Bureau's website:

6. For further discussion about the Wilson Report, see our bulletin, "Competition Policy Review Panel Proposes National Competitiveness Agenda":

7. The report is available on the Bureau's website:

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.

In association with
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
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). 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 & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd 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 or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions