Canada: New Document Disclosure Regime Under The Competition Act (Canada)

Since 1986, mergers in Canada, large and small alike, have been subject to the civil provisions of the Competition Act (Canada) (the "Act")1 and may be reviewed by the Commissioner of Competition (the "Commissioner") and her staff at the Competition Bureau (the "Bureau"). Since 1987, larger mergers have been subject to the notification procedure2 under the Act. Criticism had been levelled at the Canadian model of merger notification because the Canadian rules have been different from rules of other jurisdictions. Critics have often called for a Canadian process to be more closely aligned to the U.S. process because many larger mergers in Canada are international in scope and often involve a U.S. component.3 It has been said that the convergence in Canada and the U.S. of certain rules would allow for a greater degree of predictability by businesses being required to deal with regulatory processes in Canada and the U.S. Recent developments have brought the Canadian system closer to the U.S. system, for better or for worse.

Parties Beware...

Parties which propose to enter into merger discussions should be aware at an early stage, and before plans are formulated, as to the impact of new Canadian rules relating to document disclosure under the Act. The statements, analyses, marketing plans and other documentation which are normally designed by corporate officials, outside accountants and investment bankers alike in order to analyze and sell the deal may be those documents which provide a road map to the regulators and which later may have a significant impact in delaying or otherwise materially altering or cratering the deal!

Bill C-104 enacted several changes to the Act, including aligning the period before which a transaction may close more closely to the U.S. process.5 Gone is the 14-day or 42-day waiting period depending on the type of form filed; now, there is a uniform, 30-day waiting period6 which must be observed before a transaction may be closed, as is generally the case in the U.S.

These regulatory changes bring with them a different approach to form filing as well. Gone are the so-called short-form notice and the long-form notice; now, there is one uniform form of notice.7 The new form is substantially the same as the old, short-form notice but with one, extremely important addition. Prior to the enactment of Bill C-10, only the long-form notice required the filing of the types of preparatory studies referred to below; and, to be sure, most notice requirements were accomplished through the filing of the short-form notice. Now, every notice filed under Part IX of the Act will be accompanied by deal documentation, so-called 16(d) documents,8 prepared for the purpose of evaluating or analyzing, and indeed selling, the proposed transaction. As at the date of this writing, the wording providing for 16(d) documents has not yet become law. Again, such Canadian practice will be more aligned to the U.S. practice which, for years, has required the filing of similar documents, referred to as so-called 4(c) documents in the U.S.9

Some Things That you Wish for...

As time passes, businesses will grow accustomed to what, in most situations, will be the new document filing requirements of Part IX of the Act. However, equally important will be pro-active steps taken by businesses and their advisors alike to ensure that the deal that is sold is not the deal that is changed or craters just because of statements in 16(d) documents which cause the Commissioner and the Bureau to pay more attention to a transaction which otherwise would close following the initial waiting period. Accordingly, statements like:

  • the merger will give the merged business a dominant market share;
  • the merged entity will be able to increase prices without fear of competition;
  • the market in which the merging entities compete has significant technological, cost or regulatory barriers preventing competitors entering the market; or
  • following the merger, the merged entity will no longer have any effective remaining competition,

are all statements which if included in 16(d) documents will catch the regulator's attention and will surely attract further scrutiny during the merger review process.

Clients and their advisors alike are well advised to have draft selling documentation sent first to counsel for review. Such process may assist in protecting solicitor-client privilege, where possible, with respect to these draft documents and, at the same time, allow counsel to suggest alternate wording which may avoid a self-fulfilling prophecy of delay and problems arising from draft documentation which otherwise contains obvious wording of an anti-competitive nature.

To SIR with Love...

While most mergers do not result in substantive competition concerns, a poor choice of wording in 16(d) documents can outline a negative roadmap which may be problematic for the merging parties.

Recently published Merger Review Process Guidelines10 describe the new, two-stage merger process. For the moment, the Bureau continues to follow its Fee and Service Standard Policy11 by classifying mergers as non-complex, complex and very complex. Non-complex mergers should be reviewed within a two-week service standard and will likely be granted either an advance ruling certificate,12 where requested, or a so-called no-action letter. Very complex mergers used to attract a five-month plus service standard because of the complexity of the review process underlying a proposed transaction which generally was marked by a high market share post-merger and significant barriers to entry. Now, certain complex and very complex mergers will receive a supplementary information request13 or SIR from the Bureau before the 30-day waiting period has expired.14 The SIR will mirror, at least from a delayed timing perspective, the HSR second-request process in the U.S. If a second request is issued in the U.S., it is not uncommon for a delay of two months to six months to occur before the additional documentation burden can be satisfied. In Canada, once the demands of a SIR have been met and the delivery is certified complete, an additional 30-day waiting period ensues before the parties may complete the transaction.15 And, as is not uncommon in the U.S. following the issuance of a second request, the issuance of a SIR may serve to kill the deal!

The Moral of the Story is...

In Canada, 16(d) documents will be new to most merging parties. Careful review of studies, surveys, analyses and reports ahead of time by competition counsel may assist in achieving a successful completion of the regulatory process on a timely basis. Otherwise, loaded documents will, in certain instances, surely result in the requirement to comply with a SIR, thus extending the review period considerably and reducing the chances for a successfully completed merger.


1 Competition Act (Canada), R.S.C. 1985, c. C-34.

2 See Part IX of the Act. Currently, the so-called parties threshold is $400 million. As a result of amendments under Bill C-10 (see endnote 4 below), the so-called transaction threshold is now $70 million.

3 See page 54 of the 134-page report entitled Compete to Win, as published by the Competition Policy Review Panel on June 26, 2008 (the "Report").

4 Bill C-10, or the Budget Implementation Act, 2009. Bill C-10 received First Reading on February 6, 2009 and, generally, became law effective March 12, 2009. Many of the amendments to the Act contained in Bill C-10 followed recommendations from the Report.

5 In the U.S., the pre-notification statute is called Hart-Scott-Rodino Antitrust Improvements Act of 1976 ("HSR").

6 Section 123(1)(a) of the Act.

7 Section 114 (1)(a) of the Act requires that:

the parties to a proposed transaction shall, before the transaction is completed, notify the Commissioner that the transaction is proposed and supply the Commissioner with the prescribed information ...

On April 4, 2009, proposed amendments to the Notifiable Transactions Regulations (the "Proposed Regs") were published in the Canada Gazette, Part I. Part of the explanatory notes to the Proposed Regs state:

These amendments relate to the introduction of a new merger review process and the elimination of the separate "short form" and "long form" notification information requirements in favour of a uniform requirement.

As at the date of this writing, the Proposed Regs have not yet become law.

8 The Proposed Regs require the filing of certain documentation with each notice. The current wording of the proposed regulation relating to this documentation is found in section 16(d) of the Proposed Regs, which reads as follows:

(d) In respect of each party, and each of its affiliates referred to in subparagraph (c)(iii), all studies, surveys, analyses and reports that were prepared or received by a senior officer for the purpose of evaluating or analysing the proposed transaction with respect to market shares, competition, competitors, markets, potential for sales growth or expansion into new products or geographic regions and, if not otherwise as set out in that document, the names and titles of the individuals who prepared the document and the date on which it was prepared.

9 Item 4(c) of the HSR notification and report form contains the following instructions:

4(c) – all studies, surveys, analyses and reports which were prepared by or for any officer(s) or director(s) (or, in the case of unincorporated entities, individuals exercising similar functions) for the purpose of evaluating or analyzing the acquisition with respect to market shares, competition, competitors, markets, potential for sales growth or expansion into product or geographic markets, and indicate (it not contain in the document itself) the date of preparation, and the name and title of each individual who prepared each such document.

10 The Bureau published the Merger Review Process Guidelines (the "Guidelines") on September 18, 2009. It is notable that the Guidelines have been published before the coming into force of the Proposed Regs.

11 Published by the Bureau, as revised, on December 4, 2003.

12 Issued in accordance with section 102 of the Act.

13 See section 114(2) of the Act.

14 At the time of this writing, various reports indicate that the Commissioner has issued as many as 5 SIRs since the enactment of Bill C-10.

15 Section 123(1)(b) of the Act.

Bill VanderBurgh practises in the area of corporate law, serving the Canadian legal needs of foreign-controlled multinational clients. He has represented foreign-based clients in connection with highly sensitive matters under the former Foreign Investment Review Act (Canada), the current Investment Canada Act and in connection with other matters involving foreign direct investment in Canada. Bill assists foreign-based clients with merger and other competition law matters arising under the Competition Act (Canada).

Martin E. Kovnats practises both domestically and internationally in the area of public and private debt and equity financings, merger and acquisition activities, take-over bids, venture capital transactions and general corporate/ commercial matters. Martin has been recognized as one of the leading midmarket M&A lawyers in Canada and has extensive cross-border experience and expertise. Recent transactions involve acting for both Canadians and non-Canadians in transactions in Canada and where Canadians are involved outside Canada.

Peter K. Czegledy practice includes assisting a spectrum of clients ranging from start-up private businesses to large multinationals. His work is focused in three key areas: mergers and acquisitions, high technology businesses and financing. Many of Peter's clients are American or other international businesses seeking opportunities in Canada. Peter seeks to provide innovative and efficient solutions to client needs by tailoring legal solutions to suit the unique circumstances of each client.

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
Check to state you have read and
agree to our Terms and Conditions

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.

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 by clicking here .

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.


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.