22 January 2024

Competition Litigation Comparative Guide

Competition Litigation Comparative Guide for the jurisdiction of Canada, check out our comparative guides section to compare across multiple countries
Canada Antitrust/Competition Law
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1 Legal framework

1.1 Which laws regulate competition in your jurisdiction?

In Canada, market competition is regulated by the Competition Act. The Competition Act establishes a regime for private claims and public enforcement of competition law.

The Competition Act contains both criminal prohibitions and civil provisions. The violation of criminal offences can lead to criminal fines or imprisonment. In addition, anyone harmed by a violation of a criminal provision may bring a civil suit for damages in the Federal Court or a provincial superior court. On the other hand, civil provisions are enforced by the Competition Tribunal through fines or orders. The act also establishes procedure for merger notification and review.

All provinces have consumer protection legislation which applies to consumer transactions in the province. Misrepresentation claims can be brought under both the Competition Act and provincial consumer protection legislation.

Common law and equitable claims also apply to competition. For example, a conspiracy can ground common law conspiracy claims or an equitable claim in unjust enrichment.

1.2 Which authorities are responsible for enforcing the competition legislation? What is their general approach to enforcement?

The Competition Bureau of Canada investigates complaints and decides whether to proceed with the filing of an application to the Competition Tribunal.

Bureau investigations are often based on complaints made by consumers, businesses or whistleblowers. Information may also be provided by participants in the illegal activity who seek immunity from prosecution, or leniency, under the Competition Act. The competition commissioner may also commence a formal inquiry if there is reason to believe that an offence has been or is about to be committed.

Bureau investigators may interview customers, suppliers, competitors, end consumers and other industry participants. They may use a range of investigative tools to obtain evidence, such as:

  • conducting searches;
  • obtaining production orders for records;
  • requesting written responses to questions;
  • conducting oral examinations; and
  • using wiretaps.

If bureau investigators secure sufficient evidence of an offence, the commissioner may refer the case to the director of public prosecutions for prosecution.

2 Private claims

2.1 What types of private claim may be brought for breach of competition law in your jurisdiction?

In courts, a private claim for damages resulting from breach of competition law may be brought under Section 36 of the Competition Act. A Section 36 claim is based on a breach of Part VI of the act, which contains prohibitions against:

  • agreements between competitors;
  • anti-competitive sporting agreements;
  • bid rigging;
  • misrepresentation;
  • double ticketing;
  • multi-level marketing; and
  • beginning June 2023, wage fixing and no-poaching agreements between employers.

Common law claims may also be brought, such as for:

  • common law conspiracy;
  • misrepresentation; and
  • unjust enrichment.

Successful common law claims can ground a broad set of remedies, including:

  • compensatory and punitive damages; and
  • injunctions against the anti-competitive conduct.

Provincial consumer protection statutes also provide for claims for damages and rescission. Depending on the province, a consumer may seek redress for misrepresentation, unconscionable transactions and other unfair business practices.

At the Competition Tribunal, a private claim may be brought to seek an order prohibiting certain anti-competitive conduct, such as refusal to deal, price maintenance, exclusive dealing and abuse of dominance. In addition, the claimant may ask the tribunal to award an administrative monetary penalty against the party engaged in the conduct.

2.2 What is the legal basis for bringing a claim for breach of competition law?

Private damages claims under the Competition Act may be brought under Section 36 of the Competition Act for harm caused by a breach of Part VI of the act.

Claims such as for common law conspiracy, misrepresentation and unjust enrichment may be brought under provincial common law. Statutory misrepresentation and unconscionable transaction claims may be brought under provincial consumer protection statutes. For example, Ontario consumers can rely on Section 18 of the Consumer Protection Act to rescind a contract entered while a person engages in an unfair practice.

Reviewable matters by the Competition Tribunal may be brought under Sections 75 to 77 and 79 of the Competition Act.

3 Parties

3.1 Who has standing to bring a claim for breach of competition law?

Anyone harmed by a breach of Part VI of the Competition Act may bring a claim under Section 36. This provision has been interpreted broadly. The only requirements are proof of a breach of Part VI and for the harm to be caused by the breach.

Common law claims such as conspiracy and misrepresentation are available to those that experience harm caused by the conduct. Remedies under provincial consumer protection statutes are only available to 'consumers', defined as individuals acting for personal, family or household purposes.

Further, if individuals or businesses believe they have been directly and substantially affected under Section 75, 76, 77 or 79 of the Competition Act, they can bring an application to the Competition Tribunal.

3.2 Can a claim for breach of competition law be brought against parties outside the jurisdiction?

A Canadian court may assume jurisdiction over a foreign defendant if there is a real and substantial connection between the claim and the court. Establishing real and substantial connection involves three steps:

  • Does the court have presumptive jurisdiction based on the existence of one or more prescribed factors that link the subject matter of the litigation to the forum, such as whether the defendant carries on business in the forum or the tort was committed in the forum?
  • Can the court's presumptive jurisdiction be rebutted by showing that the connecting factors do not point to a real relationship or to only a weak relationship between the subject matter of the litigation and the forum?
  • If the court has jurisdiction, should it decline to exercise its jurisdiction in favour of a clearly more appropriate forum based on the doctrine of forum conveniens?

Where anti-competitive conduct occurs abroad but harm is felt in Canada, a Canadian court is entitled to assume jurisdiction over the dispute.

3.3 Can a claim for breach of competition law be brought against individuals, or only companies?

Almost all claims for breach of competition law can be brought against companies and individuals. The exception is Section 46 of the Competition Act (foreign directive to participate in conspiracy), which, by its nature and wording, applies only to companies.

4 Collective actions

4.1 Is it possible to bring a collective action for breach of competition law in your jurisdiction? If so, what is the applicable regime?

Yes, such actions are known as class actions or class proceedings. A class proceeding may be brought in the Federal Court of Canada and in provincial superior courts.

The standards and procedure applicable to class proceedings across the country are similar; however, they are governed by regimes specific to the jurisdiction. In the Federal Court of Canada, Part 5.1 of the Federal Courts Rules governs class proceedings.

Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island and Saskatchewan have class proceedings legislation that applies to the courts in each province.

In Quebec, class proceedings are governed by an Act Respecting the Fonds d'aide aux actions collectives, Civil Code of Quebec, Code of Civil Procedure, Regulation of the Superior Court of Quebec in Civil Matters.

4.2 Do collective actions proceed on an 'opt-in' or an 'opt-out' basis?

Most Canadian class proceedings take place on an opt-out basis.

In the Federal Court of Canada, and in the provinces of Ontario, British Columbia, Manitoba, Saskatchewan, Quebec, Alberta and Nova Scotia, class proceedings decisions are binding on class members unless they opt out of the class.

In Newfoundland and New Brunswick, residents of those provinces must opt out. However, non-residents must opt in.

4.3 Do collective actions require certification? If so, what requirements must be met to obtain certification?

In the Federal Court of Canada and nine common law provinces with class proceedings legislation, certification requirements are generally similar, with minor variations. Generally, certification requires that:

  • the pleadings disclose a cause of action;
  • there is an identifiable class of two or more persons;
  • the claims of class members raise common issues;
  • a class proceeding would be the preferable procedure for the resolution of the proposed common issues; and
  • there is a representative plaintiff who:
    • would fairly and adequately represent the interests of the class;
    • has a workable litigation plan; and
    • does not have on the common issues an interest in conflict with other class members.

The first requirement is established if, assuming the facts pleaded to be true, the claim discloses a cause of action. 'Some basis in fact' must be provided for the second to fifth requirements above. This means the claimant must show minimal evidentiary basis that those requirements have been met.

In Quebec, the test for authorisation requires that:

  • the claims of the class members raise identical, similar or related issues of law or fact;
  • the facts alleged appear to justify the conclusions sought;
  • it would be difficult for the class members to have joined in the same suit or conferred a mandate to a representative to act on their behalf; and
  • the representative plaintiff will adequately represent the class.

5 Forum

5.1 In what forum(s) are claims for breach of competition law heard in your jurisdiction?

There are three forums to bring a claim for breach of competition law in Canada:

  • Provincial superior courts can hear private claims for damages under Section 36 of the Competition Act and other statutory, common law or equitable claims.
  • The Federal Court of Canada can hear private claims for damages under Section 36 of the Competition Act.
  • The Competition Tribunal can hear certain types of claims brought by the commissioner of competition and a narrower set of private claims. The tribunal may award an administrative monetary penalty (similar to a fine) against the party engaged in the anti-competitive conduct and prohibit the conduct. It cannot award damages or equitable remedies to private litigants.

6 Bringing a claim

6.1 What is the limitation period for claims for breach of competition law in your jurisdiction?

The limitation period for a claim under Section 36 of the Competition Act is two years.

The statutes of limitations in various provinces will apply to all other claims brought in court. For example, Ontario, British Columbia and most other provinces have a two-year limitation period. Quebec, on the other hand, has a three-year limitation period.

The principles of discoverability and fraudulent concealment apply to these limitation periods. Under these doctrines, the limitation period begins to run from the time at which the facts relevant to the claim are known or should have been known to the claimant. As a result, in conspiracy claims deliberately concealed by defendants, the limitation period may only begin to run once the conspiracy becomes known to the claimant.

Class proceedings legislation suspends limitation periods for proposed class members from the filing of a statement of claim. The limitation period is typically suspended:

  • until, and if, the court refuses to certify an action; or
  • if a class member decides to opt out or is excluded from the action.

The limitation period to seek leave for a private claim at the Competition Tribunal under Section 103.1 of the Competition Act is one year after the conduct in issue ceases.

6.2 What are the formal requirements for bringing a claim for breach of competition law?

Please see question 6.3.

6.3 What are the procedural and substantive requirements for bringing a claim for breach of competition law?

For proceedings brought in a court, the applicable procedure is set out by the rules of that court. There is no special court procedure for competition cases.

Under Section 103.1 of the Competition Act, private claimants must first seek permission to file an application with the Competition Tribunal. Permission is granted if the claimant has suffered directly and substantially due to the conduct in question. The Competition Tribunal Rules set out the applicable procedure for proceedings at the tribunal.

6.4 What are the implications if a public enforcement action in relation to the same behaviour is pending? Can a claim still be brought?

In courts, private claims may be brought parallel to public enforcement. A conviction in a public enforcement action for an offence under Part VI or the Competition Act can be proof in a private claim that the person engaged in conduct contrary to Part VI.

A private claim may not be brought under Sections 75, 76, 77 or 79 of the Competition Act at the Competition Tribunal if:

  • there is an ongoing or discontinued investigation by the commissioner of competition on the matter; or
  • it is the subject of an application already submitted to the tribunal by the commissioner.

The commissioner of competition can intervene in applications by private persons to the tribunal, after leave (permission) is granted under Section 103.1 of the Competition Act.

6.5 How is jurisdiction over the claim determined?

Jurisdiction is determined by the location and the type of claim.

The Federal Court of Canada and provincial superior courts have concurrent jurisdiction over claims brought under Section 36 of the Competition Act. The Federal Court of Canada has national jurisdiction, whereas provincial courts have jurisdiction for claims pertaining to that province. Only the provincial superior courts may hear claims based in common law and consumer protection statutes. However, national classes are permitted in most provincial superior courts in addition to the Federal Court.

The Competition Tribunal has exclusive national jurisdiction over claims under Parts VII.1 and VIII of the Competition Act. Part VII.1 (Sections 74.01 to 74.19) of the Competition Act involves deceptive marketing practices. Part VIII (Sections 75 to 107) involves restrictive trade practices including:

  • refusal to supply;
  • price maintenance;
  • exclusive dealing;
  • tied selling;
  • market restriction;
  • abuse of dominant position;
  • delivered pricing;
  • foreign judgments and laws;
  • foreign suppliers;
  • specialisation agreements; and
  • mergers.

6.6 How is the applicable law determined?

The law applicable to a dispute is determined based on a link between the parties or the legal claim and a jurisdiction. Generally, the applicable law for torts is the law of the place where the tort occurred. For torts occurring in multiple jurisdictions, the location of the harm has been held to determine the applicable law.

6.7 Under what circumstances must security for costs be provided?

In most Canadian litigation, there are adverse costs consequences for the unsuccessful party. This general rule applies to class proceedings in Ontario, Quebec and some other provinces. In British Columbia, Saskatchewan, Manitoba and Newfoundland and Labrador, and in the Federal Court, there are generally no costs awarded in class proceedings.

Generally, security for costs may be sought after the defendant has filed a defence to the proceeding.

The rules on security for costs vary by jurisdiction. For example, Ontario's rule provides that a defendant can make a motion for security for costs where:

  • the plaintiff or applicant is ordinarily resident outside Ontario;
  • the plaintiff or applicant has another proceeding for the same relief pending in Ontario or elsewhere;
  • the defendant or respondent has an order against the plaintiff or applicant for costs in the same or another proceeding that remain unpaid in whole or in part;
  • the plaintiff or applicant is a corporation or a nominal plaintiff or applicant, and there is good reason to believe that the plaintiff or applicant has insufficient assets in Ontario to pay the costs of the defendant or respondent;
  • there is good reason to believe that the action or application is frivolous and vexatious, and that the plaintiff or applicant has insufficient assets in Ontario to pay the costs of the defendant or respondent; or
  • a statute entitles the defendant or respondent to security for costs.

6.8 Are interim remedies available in competition litigation? If so, how are they obtained?

Interim relief is available for competition litigation. An interim injunction may be sought if the following factors are present:

  • There is a serious issue to be tried;
  • Irreparable harm would be suffered if the relief were not granted; and
  • The balance of convenience favours issuance of an injunction.

At the Competition Tribunal, an interim injunction or temporary order prohibiting the anticompetitive conduct is available for matters under Section 74 (deceptive marketing practices). In addition, interim remedies are available under merger review proceedings at the tribunal.

7 Disclosure and privilege

7.1 What rules apply to disclosure in your jurisdiction? Do any exceptions apply?

Parties may engage in:

  • documentary discovery;
  • examinations for discovery; and
  • written discovery.

Parties must disclose all relevant documents in their power, possession or control. A party may need to disclose confidential or commercially sensitive information.

Examinations for discovery are only permitted of parties to the litigation. For corporate parties, it is only permissible to examine a single representative, although courts may allow additional examinations. A person may also be examined through written questions. The responses are in the form of an affidavit. These rules also apply to class proceedings.

There is no right to pre-trial examinations for discovery of experts. In general, the only obligation on a party seeking to tender expert evidence at trial is to deliver a report in advance of trial that sets out the expert's opinion.

In class proceedings, discovery is restricted to issues certified as common issues. Discovery is only available once a case is certified.

7.2 What rules on third-party disclosure apply in your jurisdiction?

Non-party disclosure rules depend on the Canadian jurisdiction in which the litigation occurs. Generally, permission can be sought from the court for a non-party to produce a document in its possession. Such permission is given when:

  • the document is relevant to a material issue in the action; and
  • it would be unfair to require the moving party to proceed to trial without having discovery of the document.

7.3 What rules on privilege apply in your jurisdiction?

Privilege excludes documents that would otherwise be compellable and producible in litigation. Recognised classes of privilege include:

  • solicitor-client privilege;
  • litigation privilege;
  • common interest privilege; and
  • settlement privilege.

If privilege is asserted outside of these recognised classes, they will be assessed on a case-by-case basis. Case-by-case privilege is often sought for communications with journalists, doctors, accountants, or financial advisers.

Solicitor-client privilege applies when the communication:

  • is between a lawyer and client;
  • is intended to be confidential; and
  • is for the purpose of seeking or receiving legal advice.

Litigation privilege covers communications created for the dominant purpose of preparing for existing or anticipated litigation. Litigation privilege ends with the litigation.

Common interest privilege allows parties with a common interest to share information without a waiver of privilege. Common interest privilege applies when:

  • either solicitor-client or litigation privilege exists in the communication; and
  • there is limited disclosure with the expectation of confidentiality for the purpose of pursuing a common interest.

Settlement negotiations are protected communications when:

  • there is a litigious dispute in existence or contemplation of one;
  • it is made with express or implied intention not to be disclosed to court if discussions fail; and
  • its purpose is to attempt to effect settlement.

8 Evidence

8.1 What types of evidence are permissible in your jurisdiction? Is expert evidence accepted?

In civil competition actions, evidence that is submitted to the court must be relevant to the claim. Both direct and circumstantial evidence is permissible.

Claimants may use evidence gathered during an investigation by the Competition Bureau.

In competition claims, it is common that expert opinion evidence is tendered to prove harm from the anti-competitive activity.

8.2 What is the applicable standard of proof?

In criminal competition cases, the applicable standard of proof is 'beyond a reasonable doubt'. In Canada, defendants are presumed to be innocent until proven guilty. This presumption of innocence must be rebutted. To rebut the presumption, the case against the defendant must be proved so that a reasonable person would not have any reasonable doubt about the defendant's guilt.

In civil cases, the applicable standard of proof is a 'balance of probabilities'. This means that findings of fact are to be made on the basis that they are more likely than not – or more than 50% likely – to be true.

8.3 On whom does the burden of proof rest?

In criminal cases, the burden of proof rests on the government. In civil cases, the burden of proof rests on the claimant, which can also include the government.

8.4 What defences are typically available in competition litigation?

If a claim is brought pursuant to the Competition Act, the act stipulates several defences depending on the specific offence.

Common law or provincial consumer protection legislation claims can also be brought. General defences to these claims include the following:

  • The limitation period has expired;
  • The claimant has not made out the elements of the cause of action;
  • There is lack of jurisdiction, estoppel or res judicata; and/or
  • There is a release of claims.

There are also defences specific to common law causes of action. For example, defences to unjust enrichment include the 'clean hands' doctrine and failure to show a corresponding loss.

9 Settlement

9.1 Can the proceedings be discontinued without a full trial? If so, how; and what are the implications?

Court proceedings can be discontinued without a full trial – for example, if there is a settlement.

A party may serve on another party an offer to settle. There may be cost consequences associated with settlement offers. For example, if the plaintiff makes an offer to settle that is not accepted by the defendant and the plaintiff obtains a judgment which is as favourable as or more favourable than the terms of the offer to settle, the plaintiff is entitled to partial indemnity costs to the date on which the offer to settle was served and substantial indemnity costs from that date, unless the court orders otherwise.

In another example, court proceedings can be discontinued without a full trial on a motion for summary judgment. On a motion for summary judgment, the court can determine there is 'no genuine issue for trial' and may dispose of all or part of a claim without a trial. On a motion for summary judgment, the parties must show whether there is a dispute over a material fact that requires resolution by trial.

9.2 In the case of collective actions, is collective settlement possible? If so, how; and what are the implications?

Settlements in class proceedings are possible. A class proceeding may be settled only with the approval of the court.

The court may approve a settlement if it finds that, in all the circumstances, the settlement is fair, reasonable and in the best interests of the class. The court will consider factors such as:

  • the likelihood of recovery or success;
  • the proposed settlement terms and conditions; and
  • the amount and nature of discovery, evidence or investigation.

The court does not make findings of facts on the merits of the litigation when determining whether to approve a settlement. Instead, a settlement must fall within a zone of reasonableness. A settlement need not be perfect or treat everybody equally.

If approved by the court, the settlement is binding on every class member that has not opted out of the class proceeding.

10 Court proceedings

10.1 Are court proceedings in your jurisdiction public or private? If the former, are any options available to the parties to keep the proceedings or related information confidential?

Court proceedings in Canada are generally public. Information can be confidential in court proceedings: the court may order that material to be filed be treated as confidential. Before making such an order, the court must be satisfied that the material should be treated as confidential, notwithstanding the public interest in open and accessible court proceedings.

10.2 How do the court proceedings unfold in your jurisdiction?

Typically, court proceedings begin with the pleadings stage, where parties file and serve a statement of claim, statement of defence(s), and, if applicable, counterclaims or third-party claims.

Parties will then typically start the discovery process. The discovery process includes:

  • the exchange of documents;
  • examinations for discovery; and
  • cross-examinations.

In class proceedings, parties generally do not obtain discovery rights until an action is certified as a class proceeding.

Parties may make pre-trial applications or seek the assistance of the court. The parties may also consider resolving the case without going to trial.

If the case cannot be resolved without going to trial, a trial date is set and the parties begin preparing for trial. Trial preparation may include exchanging expert opinion evidence. After the trial is over, the parties receive a judgment and award of costs, which the winning party enforces.

After a trial decision is released, the parties may choose to appeal the decision to the jurisdiction's appeal court.

10.3 What is the typical timeframe for proceedings?

The timeframes for steps in the proceedings vary by jurisdiction and are set by provincial or federal legislation that governs the procedure in civil claims. Often, in complex litigation, deadlines are often agreed to by the parties or determined by the court. This can extend the timelines beyond those set out in law.

A complex commercial action can take two to five years, if not longer, to resolve.

10.4 What rules apply to the joinder of third parties?

Rules on the joinder of third parties depends on a jurisdiction's rules on civil procedure.

Generally, the joinder of third parties must not unduly complicate or delay the hearing or cause undue prejudice to a party. A party may request a joinder during the proceeding by bringing a motion to the court; however, limitation periods may apply to the joinder of parties.

10.5 To what extent do the decisions of national or foreign competition authorities influence the court's decision?

Claimants need not wait for the Competition Bureau to initiate or obtain a judgment to bring a private claim – or even to succeed on the claim – for breach of the Competition Act. If, however, there is a conviction or guilty plea from the Competition Bureau's investigations, claimants may use documents in those proceedings to meet their evidentiary burden.

Decisions of foreign competition authorities are not binding in Canada; however, they may be persuasive.

11 Remedies

11.1 What remedies are available in competition litigation in your jurisdiction?

Under Section 36 of the Competition Act, a person may sue for damages for:

  • conduct that is contrary to any provision of Part VI – Offences in Relation to Competition; or
  • failure to comply with an order of the Competition Tribunal or another court under the Competition Act.

Criminal provisions in Part VI include conspiracy, bid rigging, false or misleading representations, telemarketing and pyramid selling.

The claimant may also sue for and recover the full cost of any investigation in connection with the matter and of proceedings under Section 36.

Common law claims can also be brought. Successful common law claims can ground a broad set of remedies, including:

  • compensatory and punitive damages; and
  • injunctions against the anti-competitive conduct.

Provincial consumer protection statutes also provide a private right of action for persons that suffer due to unfair practices. For example, Ontario's statute provides for rescission or damages to consumers who are victims of a misleading representation.

At the Competition Tribunal, a private claim may be brought to seek an order prohibiting certain anti-competitive conduct. In addition, the claimant may ask the Competition Tribunal to award an administrative monetary penalty (like a fine) against the party engaged in the conduct.

11.2 Are punitive damages awarded in your jurisdiction?

In Wong v Sony of Canada Ltd, the court found that punitive damages were not permitted pursuant to Section 36 of the Competition Act. A claim for punitive damages is dependent upon the pleading of a separate cause of action that would permit such damages. For example, a cause of action that would permit punitive damages is a common law cause of action based on civil conspiracy.

11.3 Will the courts consider any fines imposed by the competition authorities in deciding on the quantum of damages? What other factors will it consider in this regard?

No answer submitted for this question.

12 Appeals

12.1 Can the decision of the court or tribunal be appealed? If so, on what grounds and what is the process?

The decision of the court or tribunal can be appealed. The decision of a federal court or tribunal can be appealed to the Federal Court of Appeal. Actions that are brough in provincial superior courts can be appealed to provincial appeal courts.

Decisions can be appealed on the grounds of:

  • questions of law, which are reviewed for correctness;
  • findings of fact, which are reviewed for palpable and overriding error; and
  • findings of mixed fact and law, which are reviewed for palpable and overriding error, unless there is an extricable question of law, which is reviewed for correctness.

An appeal court can reverse or change the judge's decision or order a new hearing or trial. The appeal court can also uphold the trial court's decision.

If parties disagree with the decision of the appeal court, they can ask for permission to appeal the decision to the Supreme Court of Canada. The Supreme Court of Canada is the final court of appeal in Canada. The Supreme Court only hears cases that have public importance or are of such a nature or significance as to warrant a decision by the court. The parties must first seek leave of the Supreme Court to hear the case.

13 Costs, fees and funding

13.1 What costs and fees are incurred when litigating in your jurisdiction? Can the winning party recover its costs?

The costs and fees when litigating in a Canadian jurisdiction include lawyer fees and expenses of the litigation.

In Canada, in addition to awarding damages or remedies, the court may award 'costs' to the successful party. This means that the successful party may be entitled to recover the costs, including disbursements, that they incurred in pursuing or defending the lawsuit.

Factors that the courts may consider in determining cost awards include, but are not limited to:

  • the parties' conduct during the litigation;
  • the complexity of the case;
  • the amount involved; and
  • the importance of the case to the parties and to society generally.

13.2 Are contingency fees and similar arrangements permitted in your jurisdiction?

Contingency fee arrangements are permitted in Canada. Class proceedings are often litigated on a contingency fee basis.

13.3 Is third-party funding permitted in your jurisdiction?

Third-party funding is permitted in Canada. Litigation funding agreements must be approved by the courts where the funder receives its return out of the claimants' recovery in the class action or CCAA insolvency context.

To approve a third-party funding agreement, courts consider factors including whether:

  • the agreement is necessary in order to provide access to justice;
  • the access to justice facilitated by the third-party funding is substantively meaningful;
  • the agreement is fair and reasonable and facilitates access to justice while protecting the interests of the defendants; and
  • the third-party funder is not overcompensated.

The third-party funding agreement must also not interfere with the lawyer-client relationship.

It is standard in funding approval motions that portions of the third-party funding agreement be redacted to prevent sensitive and privileged information from being revealed to the opposing party, their lawyers or third parties. An unredacted version is typically provided to the court under seal.

14 Trends and predictions

14.1 How would you describe the current competition litigation landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

The Competition Act was most recently amended in 2022. The Competition Act will include a new wage-fixing and no-poaching agreement offence. It is expected to come into force in June 2023.

The new offence will include a prohibition against 'wage fixing', including agreements that "fix, maintain, decrease or control salaries, wages or terms and conditions of employments". The 'no-poaching' section will capture agreements not to solicit or hire employees between unaffiliated employers.

The 2022 amendments also allowed private claims for abuse of dominance to be brought at the Competition Tribunal.

15 Tips and traps

15.1 What would be your recommendations to parties facing competition litigation in your jurisdiction and what potential pitfalls would you highlight?

Parties bringing forward competition litigation only under the Competition Act should take care to fit their claim under the act. For example, for claims for damages resulting from a breach of a criminal provision of the act, the wrongdoing should fit under an applicable criminal provision.

If the competition claim is brought as a class action, the claimant must establish the certification requirements set out by the jurisdiction before the action can proceed to discovery and trial.

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.

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