The Annotated Competition Act 2021 Wakil

THE 2021 ANNOTATED
COMPETITION ACT
Omar Wakil, BA LLB LLM
OF THE ONTARIO BAR

SOLICITOR, ENGLAND & WALES
STATUTES OF CANADA ANNOTATED
42764810
© 2020 Thomson Reuters Canada Limited
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iii
PREFACE
I would like to thank my colleagues at Torys for their help in updating the book this year as
well as the numerous others who have corrected errors or made helpful suggestions for
change since I began work on this book, including Richard Annan, Sophie Beaulieu, Mat-
thew Boswell, Jacqueline Byers, Daniel Campagna, Matthew Chiasson, Marina Chernenko,
Andrea Das-Wieczorek, Zirjan Derwa, Anthony Durocher, Ian Farndon, David Faye, Peter
Flynn, Sue-Anne Fox, Hilary Furness, James Gotowiec, Jay Holsten, Matthew Kellison,
Joshua Krane, Ian Li, Damien Liddle, John Lowman, Delia Luca, Roger Nasrallah, Shawn
Neyland, Mark Opashinov, Eric Patenaude, Denis Pilon, Linda Plumpton, Jessica Reid, Gra-
ham Reynolds QC, Jim Robson, Shuli Rodal, David Rosner, Steven Sansom, Duane Schip-
pers, Lucia Shatat, Jim Sutton and Rebecca Wagner. Any errors or inaccuracies are, of
course, my responsibility alone.
As always, I welcome feedback and encourage readers with comments to contact me by
email at owakil@torys.com.
I have endeavoured to reflect the law as it stood as of October 2020, although the legislation
in this edition is current to the Canada Gazette Vol: 154:42 (October 17, 2020).
Omar Wakil
Toronto, October 2020
v
SUMMARY TABLE OF CONTENTS
Table of Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ix
Table of Cases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xxiii
Introduction: An Overview of the Competition Act . . . . . . . . . . . . . . . . . . . . . . . . . xlix
Competition Act and Regulations

Competition Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
Part I — Purpose and Interpretation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
Part II — Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Part III — Mutual Legal Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Part IV — Special Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Part V — [Repealed] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
Part VI — Offences in Relation to Competition . . . . . . . . . . . . . . . . . . . . . . . 105
Part VII — Other Offences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164
Part VII.1 — Deceptive Marketing Practices . . . . . . . . . . . . . . . . . . . . . . . . . . 179
Part VIII — Matters Reviewable By Tribunal . . . . . . . . . . . . . . . . . . . . . . . . . 207
Part IX — Notifiable Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 307
Part X — General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 335
Notifiable Transactions Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 341
Competition Tribunal Act and Regulations

Competition Tribunal Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 363
Part I — Competition Tribunal Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 363
Competition Tribunal Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 437
Regulatory Impact Analysis Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 477
Competition Bureau Guidelines

Procedures Guide for Notifiable Transactions and Advance Ruling Certificates under
the Competition Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 481
Pre-merger Notification Interpretation Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . 505
Hostile Transactions Interpretation Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . 550
Competition Bureau Fees and Service Standards Handbook for Mergers and Merger-Related
Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 555
Competition Bureau Fees and Service Standards Policy for Mergers and Merger-Related
Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 577
Merger Enforcement Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 587
Merger Review Process Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 641
vii
Summary Table of Contents
Competitor Collaboration Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 663

Immunity Program under the Competition Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . 717
Leniency Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 781
Leniency Program: Frequently Asked Questions . . . . . . . . . . . . . . . . . . . . . . . . . . . 799
Abuse of Dominance Enforcement Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . 819
Price Maintenance (Section 76 of the Competition Act) Enforcement Guidelines . . . . 869
Information Bulletin on the Communication of Confidential Information under
the Competition Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 895
Intellectual Property Enforcement Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 911
International Competition Network’s Recommended Practices

Merger Notification Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 971
Competition Tribunal Practice Directions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1009
Transport Canada Guidelines for the Assessment of Air Carrier Joint Ventures . . . . 1053
Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1073
viii
TABLE OF CONTENTS
COMPETITION ACT
SHORT TITLE
1 Short Title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
PART I — PURPOSE AND INTERPRETATION
Purpose
1.1 Purpose of Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
Interpretation
2 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
2.1 Binding on agents of Her Majesty in certain cases . . . . . . . . . . . . . .6
3 Defects of form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
4 Collective bargaining activities . . . . . . . . . . . . . . . . . . . . . . . . . . .8
4.1 [Repealed 2009, c. 2, s. 407.] . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
5 Underwriters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
6 Amateur sport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
PART II — ADMINISTRATION
7 Commissioner of Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
8 Deputy Commissioners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
9 Application for inquiry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
10 Inquiry by Commissioner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
11 Order for oral examination, production or written return . . . . . . . . . 15
12 Witness competent and compellable . . . . . . . . . . . . . . . . . . . . . . . 27
13 Presiding officer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
14 Administration of oaths . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
14.1 Application of Criminal Code . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
15 Warrant for entry of premises . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
16 Operation of computer system . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
17 Presentation of or report on record or thing seized . . . . . . . . . . . . . 36
18 Commissioner to take reasonable care . . . . . . . . . . . . . . . . . . . . . 37
19 Claim to solicitor-client privilege (section 11) . . . . . . . . . . . . . . . . 39
20 Inspection of records and things . . . . . . . . . . . . . . . . . . . . . . . . . 42
21 Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
22 Discontinuance of inquiry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
23 Reference to Attorney General of Canada . . . . . . . . . . . . . . . . . . . 43
24 Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
25 Staff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
26 Remuneration of temporary staff . . . . . . . . . . . . . . . . . . . . . . . . . 44
27 Authority of technical or special assistants . . . . . . . . . . . . . . . . . . 45
28 Minister may require interim report . . . . . . . . . . . . . . . . . . . . . . . 45
29 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
29.1 Communication to Minister of Transport . . . . . . . . . . . . . . . . . . . 48
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29.2 Communication to Minister of Finance . . . . . . . . . . . . . . . . . . . . . 49

PART III — MUTUAL LEGAL ASSISTANCE
Interpretation
30 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Functions of the Minister of Justice
30.01 Agreements respecting mutual legal assistance . . . . . . . . . . . . . . . 52
Publication of Agreements
30.02 Publication in Canada Gazette . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Requests Made to Canada from Abroad
Requests
30.03 Requests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Search and Seizure
30.04 Application of sections 15, 16 and 19 . . . . . . . . . . . . . . . . . . . . . 55
30.05 Approval of request for search and seizure . . . . . . . . . . . . . . . . . . 55
30.06 Warrant for entry of premises . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
30.07 Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
30.08 Sending abroad . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
30.09 Terms and conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Evidence for Use Abroad
30.1 Approval of request to obtain evidence . . . . . . . . . . . . . . . . . . . . . 58
30.11 Evidence-gathering order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
30.12 Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
30.13 Sending abroad . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
30.14 Terms and conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
30.15 Approval of request to obtain evidence by video link, etc. . . . . . . . 63
30.16 Order for video link, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
30.17 Other laws to apply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
30.18 Arrest warrant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Lending Exhibits
30.19 Approval of loan request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
30.2 Making of loan order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
30.21 Variation of loan order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
30.22 Copy of order to custodian . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
30.23 Presumption of continuity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Appeal
30.24 Appeal on question of law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Evidence Obtained by Canada from Abroad
30.25 Evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
30.26 Foreign records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
30.27 Foreign things . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
30.28 Status of certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
General
30.29 Confidentiality of foreign requests and evidence . . . . . . . . . . . . . . 71
30.291 Records or other things already in Commissioner’s possession . . . . 71
30.3 Preservation of informal arrangements . . . . . . . . . . . . . . . . . . . . . 71
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PART IV — SPECIAL REMEDIES

31 Reduction or removal of customs duties . . . . . . . . . . . . . . . .... . 72
32 Powers of Federal Court where certain rights used to restrain trade . ..
........................................... .... . 72
33 Interim injunction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... . 74
34 Prohibition orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... . 76
35 Court may require returns . . . . . . . . . . . . . . . . . . . . . . . . . .... . 84
36 Recovery of damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... . 84
PART V
37–44 [Repealed R.S.C. 1985, c. 19 (2nd Supp.), s. 29.] . . . . . . . . . . . . 105
PART VI — OFFENCES IN RELATION TO COMPETITION
45 Conspiracies, agreements or arrangements between competitors . . . 105
45.1 Where application made under section 76, 79, 90.1 or 92 . . . . . . . 124
46 Foreign directives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124
47 Definition of “bid-rigging” . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
48 Conspiracy relating to professional sport . . . . . . . . . . . . . . . . . . . 130
49 Agreements or arrangements of federal financial institutions . . . . . 131
50, 51 [Repealed 2009, c. 2, s. 413.] . . . . . . . . . . . . . . . . . . . . . . . . . . 133
52 False or misleading representations . . . . . . . . . . . . . . . . . . . . . . 133
52.01 False or misleading representation — sender or subject matter
information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 148
52.02 Assisting foreign states . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149
52.1 Definition of “telemarketing” . . . . . . . . . . . . . . . . . . . . . . . . . . . 150
53 Deceptive notice of winning a prize . . . . . . . . . . . . . . . . . . . . . . 153
54 Double ticketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155
55 Definition of “multi-level marketing plan” . . . . . . . . . . . . . . . . . 156
55.1 Definition of “scheme of pyramid selling” . . . . . . . . . . . . . . . . . 158
56–59 [Repealed 1999, c. 2, s. 17.] . . . . . . . . . . . . . . . . . . . . . . . . . . . 159
60 Defence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159
61 [Repealed 2009, c. 2, s. 417.] . . . . . . . . . . . . . . . . . . . . . . . . . . 162
62 Civil rights not affected . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162
PART VII — OTHER OFFENCES
Offences
63 [Repealed R.S.C. 1985, c. 19 (2nd Supp.), s. 37.] . . . . . . . . . . . . 164
64 Obstruction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164
65 Contravention of Part II provisions . . . . . . . . . . . . . . . . . . . . . . 165
65.1 Contravention of subsection 30.06(5) . . . . . . . . . . . . . . . . . . . . . 167
65.2 Refusal after objection overruled . . . . . . . . . . . . . . . . . . . . . . . . 167
66 Contravention of order under Part VII.1 or VIII . . . . . . . . . . . . . 168
66.1 Whistleblowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
66.2 Prohibition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
Procedure
67 Procedure for enforcing punishment . . . . . . . . . . . . . . . . . . . . . . 170
68 Venue of prosecutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172
69 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172
70 Admissibility of statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 176
71 Statistics collected by sampling methods . . . . . . . . . . . . . . . . . . . 177
72 Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 177
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73 Jurisdiction of Federal Court . . . . . . . . . . . . . . . . . . . . . . . . . . . 178

74 [Repealed 1999, c. 2, s. 22.] . . . . . . . . . . . . . . . . . . . . . . . . . . . 179
PART VII.1 — DECEPTIVE MARKETING PRACTICES
Reviewable Matters
74.01 Misrepresentations to public . . . . . . . . . . . . . . . . . . . . . . . . . . . 179
74.011 False or misleading representation — sender or subject matter
information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 188
74.012 Assisting foreign states . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 188
74.02 Representation as to reasonable test and publication of testimonials . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 189
74.03 Representations accompanying products . . . . . . . . . . . . . . . . . . . 190
74.04 Definition of “bargain price” . . . . . . . . . . . . . . . . . . . . . . . . . . . 192
74.05 Sale above advertised price . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193
74.06 Promotional contests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193
74.07 Saving . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195
74.08 Civil rights not affected . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195
Administrative Remedies
74.09 Definition of “court” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195
74.1 Determination of reviewable conduct and judicial order . . . . . . . . 195
74.101 Deduction from administrative monetary penalty . . . . . . . . . . . . . 201
74.11 Temporary order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 201
74.111 Interim injunction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202
74.12 Consent agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 203
74.13 Rescission or variation of consent agreement or order . . . . . . . . . 206
74.14 Evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206
74.15 Unpaid monetary penalty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206
74.16 Proceedings commenced under Part VI . . . . . . . . . . . . . . . . . . . . 206
Rules of Procedure
74.17 Power of courts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 207
Appeals
74.18 Appeal to Federal Court of Appeal . . . . . . . . . . . . . . . . . . . . . . 207
74.19 Appeal on question of fact . . . . . . . . . . . . . . . . . . . . . . . . . . . . 207
PART VIII — MATTERS REVIEWABLE BY TRIBUNAL
Restrictive Trade Practices
Refusal to Deal
75 Jurisdiction of Tribunal where refusal to deal . . . . . . . . . . . . . . . 207
Price Maintenance
76 Price maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 214
Exclusive Dealing, Tied Selling and Market Restriction
77 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 222
Abuse of Dominant Position
78 Definition of “anti-competitive act” . . . . . . . . . . . . . . . . . . . . . . 228
79 Prohibition where abuse of dominant position . . . . . . . . . . . . . . . 232
79.1 Unpaid monetary penalty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 246
Delivered Pricing
80 Definition of “delivered pricing” . . . . . . . . . . . . . . . . . . . . . . . . 246
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81 Delivered pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 247

Foreign Judgments and Laws
82 Foreign judgments, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 248
83 Foreign laws and directives . . . . . . . . . . . . . . . . . . . . . . . . . . . . 248
Foreign Suppliers
84 Refusal to supply by foreign supplier . . . . . . . . . . . . . . . . . . . . . 249
Specialization Agreements
85 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 250
86 Order directing registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . 251
87 Registration of modifications . . . . . . . . . . . . . . . . . . . . . . . . . . . 255
88 Right of intervention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 256
89 Register of specialization agreements . . . . . . . . . . . . . . . . . . . . . 256
90 Non-application of sections 45, 77 and 90.1 . . . . . . . . . . . . . . . . 256
Agreements or Arrangements that Prevent or Lessen Competition
Substantially
90.1 Order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 256
Mergers
91 Definition of “merger” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 260
92 Order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 261
93 Factors to be considered regarding prevention or lessening of competition
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 270
94 Exception . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 271
95 Exception for joint ventures . . . . . . . . . . . . . . . . . . . . . . . . . . . 272
96 Exception where gains in efficiency . . . . . . . . . . . . . . . . . . . . . . 273
97 Limitation period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 279
98 Where proceedings commenced under section 45, 49, 79 or 90.1 . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 279
99 Conditional orders directing dissolution of a merger . . . . . . . . . . . 280
100 Interim order where no application under section 92 . . . . . . . . . . 281
101 Right of intervention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 284
102 Advance ruling certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . 284
103 No application under section 92 . . . . . . . . . . . . . . . . . . . . . . . . . 285
General
103.1 Leave to make application under section 75, 76 or 77 . . . . . . . . . 286
103.2 Intervention by Commissioner . . . . . . . . . . . . . . . . . . . . . . . . . . 293
103.3 Interim order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 293
104 Interim order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 296
104.1 [Repealed 2009, c. 2, s. 433.] . . . . . . . . . . . . . . . . . . . . . . . . . . 300
105 Consent agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 300
106 Rescission or variation of consent agreement or order . . . . . . . . . 301
106.1 Consent agreement — parties to a private action . . . . . . . . . . . . . 306
107 Evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 307
PART IX — NOTIFIABLE TRANSACTIONS
Interpretation
108 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 307
Application
109 General limit relating to parties . . . . . . . . . . . . . . . . . . . . . . . . . 309
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110 Application of Part . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 310

Exemptions
Acquisition of Voting Shares, Assets or Interests
111 Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 318
Combinations
112 Combinations that are joint ventures . . . . . . . . . . . . . . . . . . . . . . 320
General
113 General exemptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 321
Notice and Information
114 Notice of proposed transaction . . . . . . . . . . . . . . . . . . . . . . . . . . 322
115 Prior notice of acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 326
116 Where information cannot be supplied . . . . . . . . . . . . . . . . . . . . 327
117 Saving . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 329
118 Information to be certified . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 330
119 Where transaction not completed . . . . . . . . . . . . . . . . . . . . . . . . 331
120–122 [Repealed 1999, c. 2, s. 34.] . . . . . . . . . . . . . . . . . . . . . . . . . . . 331
Completion of Proposed Transactions
123 Time when transaction may not proceed . . . . . . . . . . . . . . . . . . . 332
123.1 Failure to comply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 334
Regulations
124 Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 335
PART X — GENERAL
Commissioner’s Opinions
124.1 Application for written opinion . . . . . . . . . . . . . . . . . . . . . . . . . 335
References to Tribunal
124.2 Reference if parties agree . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 336
Representations to Boards, Commissions or Other Tribunals
125 Representations to federal boards, etc. . . . . . . . . . . . . . . . . . . . . 337
126 Representations to provincial boards, etc. . . . . . . . . . . . . . . . . . . 338
Report to Parliament
127 Annual report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 338
Regulations
128 Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 338
87-348 — NOTIFIABLE TRANSACTIONS REGULATIONS

SHORT TITLE
1 ...................................... . . . . . . . . . 341
INTERPRETATION
2 ...................................... . . . . . . . . . 341
AUDITED FINANCIAL STATEMENTS
3 ...................................... . . . . . . . . . 343
DETERMINATION OF AGGREGATE VALUE — GENERAL
4 ...................................... . . . . . . . . . 344
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Table of Contents
5 ............................................ . . . 345
6 ............................................ . . . 346
7 ............................................ . . . 346
PROVISIONS WITH RESPECT TO PARTIES TO THE TRANSACTION
8 ............................................ . . . 346
9 ............................................ . . . 346
PROVISIONS WITH RESPECT TO PARTIES TO AN AMALGAMATION
9.1 ............................................ . . . 347
9.2 ............................................ . . . 347
PROVISIONS APPLICABLE TO TRANSACTIONS
10 ............................................ . . . 347
11 ............................................ . . . 348
DETERMINATION OF AGGREGATE VALUE — SPECIFIC CIRCUMSTANCES
12 Specific Circumstances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 348
13 ............................................ . . . 348
14 ............................................ . . . 349
14.1 [Repealed SOR/2010-22, s. 8.] . . . . . . . . . . . . . . . . . . . . . . . . . . 350
TRANSACTIONS THAT ARE EXEMPT FROM PART IX OF THE ACT
15 ............................................ . . . 350
INFORMATION REQUIRED
16 ............................................ . . . 351
17 [Repealed SOR/2010-22, s. 10.] . . . . . . . . . . . . . . . . . . . . . . . . . 354
COMPETITION TRIBUNAL ACT

PART I — COMPETITION TRIBUNAL ACT
Short Title
1 Short Title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 363
Interpretation
2 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 363
Tribunal Established
3 Tribunal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 363
4 Chairman . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 364
5 Tenure of Judicial Members . . . . . . . . . . . . . . . . . . . . . . . . . . . 365
6 Remuneration of Lay Members . . . . . . . . . . . . . . . . . . . . . . . . . 366
7 Oath of Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366
Jurisdiction and Powers of the Tribunal
8 Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 366
8.1 Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 371
9 Court of Record . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 372
Organization of Work
10 Sittings of Tribunal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 377
11 Hearing of applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 377
Proceedings
12 Questions of Law, Fact, Mixed Law and Fact . . . . . . . . . . . . . . . 378
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Appeal
13 Appeal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 378
Administration of Tribunal
14 [Repealed 2014, c. 20, s. 447.] . . . . . . . . . . . . . . . . . . . . . . . . . 380
15 Sittings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 381
Rules
16 Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 381
17 Advance Publication of Rules and Amendments . . . . . . . . . . . . . 381
2008-141 — COMPETITION TRIBUNAL RULES

PART 1 — GENERAL
Interpretation
1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 437
Rules Applicable to All Proceedings
Dispensing with Compliance
2 Variation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 438
Time Limits
3 Interpretation Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 439
4 Calculating time limits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 439
5 Varying time limits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 439
Documents
6 Memorandum of fact and law . . . . . . . . . . . . . . . . . . . . . . . . . . 439
7 Subpoena . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 439
Service of Documents
8 Originating document . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440
9 Deemed served . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440
10 Other documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440
11 Proof of service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 442
Filing of Documents
12 Electronic filing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 442
13 Filing by intervenor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 442
14 Paper filing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 442
15 Facsimile filing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 442
16 Cover page . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443
17 Filing after 17:00 hours . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443
18 Format for electronic filing . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443
19 Irregularity or defect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443
20 Electronic sworn statement or solemn affirmation . . . . . . . . . . . . 443
21 Electronic certified copy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443
22 Public access . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 444
23 Without confidentiality order . . . . . . . . . . . . . . . . . . . . . . . . . . . 444
24 With confidentiality order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 444
Publication of Notice
25 Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 444
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Discontinuance or Withdrawal
26 Discontinuance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 445
27 Withdrawal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 445
28 Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 445
Hearings
29 Hearings open to the public . . . . . . . . . . . . . . . . . . . . . . . . . . . . 445
30 In-camera hearings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 445
Practice and Procedure
31 Composition of the Tribunal . . . . . . . . . . . . . . . . . . . . . . . . . . . 445
32 Case record in electronic format . . . . . . . . . . . . . . . . . . . . . . . . 446
33 Practice directions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 446
34 Questions as to practice or procedure . . . . . . . . . . . . . . . . . . . . . 446
PART 2 — CONTESTED PROCEEDINGS
Application
36 Notice of application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 447
37 Service of notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 447
38 Response . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 447
39 Reply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 448
40 Timetable for disposition of application . . . . . . . . . . . . . . . . . . . 448
41 Order in default of response . . . . . . . . . . . . . . . . . . . . . . . . . . . 449
Intervention
42 Motion for leave to intervene . . . . . . . . . . . . . . . . . . . . . . . . . . 449
43 Service and filing motion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 449
44 Response . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 450
45 Reply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 450
46 Disposition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 450
47 Intervention allowed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 450
48 Service of documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 450
49 Intervention by attorney general of a province . . . . . . . . . . . . . . . 451
50 Notice of intervention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 451
51 List of documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 451
52 Participation of an attorney general . . . . . . . . . . . . . . . . . . . . . . 452
53 Service of documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 452
54 Intervention by the Commissioner . . . . . . . . . . . . . . . . . . . . . . . 452
55 Commissioner’s access to documents . . . . . . . . . . . . . . . . . . . . . 452
Admissions
56 Requests for admissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 452
57 Deemed admissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 453
58 Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 453
59 Withdrawal of admission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 453
Discovery
60 Affidavit of documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 453
61 Power of the Tribunal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 454
62 Application of deemed undertaking . . . . . . . . . . . . . . . . . . . . . . 454
63 Supplementary affidavit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 455
64 Examination for discovery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 455
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Access to Documents
65 Access to documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 455
66 Confidentiality order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 455
67 Content of motion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 456
Pre-hearing Disclosure
68 List of documents and witness statements . . . . . . . . . . . . . . . . . . 456
69 Response . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 457
70 Reply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 457
Evidence at the Hearing
71 Sanctions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 457
72 Records to be admitted in evidence . . . . . . . . . . . . . . . . . . . . . . 457
73 Information under par. 11(1)(a) of the Act . . . . . . . . . . . . . . . . . 457
74 Evidence in chief . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 458
Witness Panels
75 Witness panels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 458
76 Manner of testimony . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 458
Expert Evidence
77 Expert report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 458
78 Expert report provided to the registry . . . . . . . . . . . . . . . . . . . . . 459
79 Examination of expert witness . . . . . . . . . . . . . . . . . . . . . . . . . . 459
80 Tribunal-appointed expert . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 459
PART 3 — MOTIONS
Informal Procedure
81 Informal procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 460
Formal Procedure
82 Application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 460
83 Notice of motion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 460
84 Disposition without hearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . 461
85 Service of response . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 461
86 Decision without a hearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . 461
87 Evidence and memorandum . . . . . . . . . . . . . . . . . . . . . . . . . . . . 461
88 Testimony by affidavit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 461
Motion for Summary Disposition
89 Notice of motion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 461
90 Response . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 462
91 Testimony . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 462
92 Power of the Tribunal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 462
93 Motion — refused or granted in part . . . . . . . . . . . . . . . . . . . . . . 462
94 Motion refused . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 462
PART 4 — INTERIM OR TEMPORARY ORDERS
Application
Language of Hearing
97 Official language . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 463
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Ex Parte Orders
98 Service of ex parte orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 463
Application to Vary or Set Aside Interim Orders
PART 5 — SPECIALIZATION AGREEMENTS
101 Notice of appearance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 464
102 Motion for registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 465
103 Reply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 465
104 Modification and removal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 465
PART 6 — CONSENT AGREEMENTS
106 Registration of consent agreements . . . . . . . . . . . . . . . . . . . . . . . 465
PART 7 — REFERENCES
108 Notice of reference . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 466
109 Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 466
110 Amicus curiae . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 466
111 Leave to refer in a private access case . . . . . . . . . . . . . . . . . . . . 467
112 Notice to the Commissioner . . . . . . . . . . . . . . . . . . . . . . . . . . . 467
113 Power of Tribunal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 467
PART 8 — PRIVATE ACCESS
115 Application for leave . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 467
116 Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 467
117 Certification by the Commissioner . . . . . . . . . . . . . . . . . . . . . . . 468
118 Notice by the Tribunal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 468
119 Representations in writing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 468
120 Reply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 468
121 Decision without oral hearing . . . . . . . . . . . . . . . . . . . . . . . . . . 469
122 Power of Tribunal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 469
123 Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 469
124 Leave granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 469
125 Registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 469
126 Publication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 469
127 Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 469
PART 9 — APPLICATION FOR A LOAN ORDER
128 Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 470
129 Filing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 470
131 Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 470
132 Response . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 470
133 Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 471
PART 10 — CASE MANAGEMENT
134 Definition of “judicial member” . . . . . . . . . . . . . . . . . . . . . . . . . 471
135 Case management conferences . . . . . . . . . . . . . . . . . . . . . . . . . . 471
136 Directions re scheduling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 471
xix
Table of Contents
137 Direction regarding list of matters to be considered . . . . . . . . . . . 472

138 Order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 472
139 Firm requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 472
PART 11 — TRANSITIONAL PROVISION AND REPEAL
Transitional Provision
140 Proceeding already commenced . . . . . . . . . . . . . . . . . . . . . . . . . 473
Repeal
141 Repeal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 473
SCHEDULE 1 — AFFIDAVIT OF SERVICE OF AN ORIGINATING DOCUMENT
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 473
SCHEDULE 2 — AFFIDAVIT OF SERVICE OF A DOCUMENT OTHER THAN AN
ORIGINATING DOCUMENT
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 474
SCHEDULE 3 — COUNSEL’S CERTIFICATE OF SERVICE
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 475
REGULATORY IMPACT ANALYSIS STATEMENT . . . . . . . . . . . . . . . . . . . . 477
PROCEDURES GUIDE FOR NOTIFIABLE TRANSACTIONS AND ADVANCE
RULING CERTIFICATES UNDER THE COMPETITION ACT . . . . . . . . . . . . 481
PRE-MERGER NOTIFICATION INTERPRETATION GUIDELINES . . . . . . . . 505
HOSTILE TRANSACTIONS INTERPRETATION GUIDELINES . . . . . . . . . . . 550
COMPETITION BUREAU FEES AND SERVICE STANDARDS HANDBOOK FOR
MERGERS AND MERGER-RELATED MATTERS . . . . . . . . . . . . . . . . . . . . . 555
COMPETITION BUREAU FEES AND SERVICE STANDARDS POLICY FOR
MERGERS AND MERGER-RELATED MATTERS . . . . . . . . . . . . . . . . . . . . . 577
MERGER ENFORCEMENT GUIDELINES . . . . . . . . . . . . . . . . . . . . . . . . . . . 587
MERGER REVIEW PROCESS GUIDELINES . . . . . . . . . . . . . . . . . . . . . . . . . 641
COMPETITOR COLLABORATION GUIDELINES . . . . . . . . . . . . . . . . . . . . . 663
IMMUNITY PROGRAM UNDER THE COMPETITION ACT . . . . . . . . . . . . . . 717
LENIENCY PROGRAM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 781
THE ABUSE OF DOMINANCE ENFORCEMENT GUIDELINES . . . . . . . . . . . 819
PRICE MAINTENANCE (SECTION 76) ENFORCEMENT GUIDELINES . . . . 869
INFORMATION BULLETIN ON THE COMMUNICATION OF CONFIDENTIAL
INFORMATION UNDER THE COMPETITION ACT . . . . . . . . . . . . . . . . . . . . 895
INTELLECTUAL PROPERTY ENFORCEMENT GUIDELINES . . . . . . . . . . . 911
INTERNATIONAL COMPETITION NETWORK’S RECOMMENDED PRACTICES
FOR MERGER NOTIFICATION PROCEDURES . . . . . . . . . . . . . . . . . . . . . . . 971
COMPETITION TRIBUNAL PRACTICE DIRECTIONS . . . . . . . . . . . . . . . . 1009
TRANSPORT CANADA GUIDELINES FOR THE ASSESSMENT OF AIR CAR-
RIER JOINT VENTURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1053
xx
Table of Contents
INDEX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1073
xxi
TABLE OF CASES
All references are to section numbers of the Competition Act (CA), the Competition Tribunal
Act (CTA) and the Competition Tribunal Rules (CTR).
A.G. Can. v. Fleet Aerospace Corp. (1985), 5 Canada (Procureur général)) 69 D.L.R. (4th)
C.P.R. (3d) 470, 21 C.C.C. (3d) 180 635, 30 C.P.R. (3d) 486, [1990] R.J.Q. 2668
(F.C.T.D.)................................................CA 33 (C.S.); leave to appeal to S.C.C. refused
A.G. Can. v. Law Soc. of B.C. (1992), 91 D.L.R. (4th) vii (note), 42 C.P.R.
..........................................................CA 10 (3d) v (note), 141 N.R. 396 (note) (S.C.C.)
................ CA 92, CTA 3, CTA 5, CTA 6
A.G. Que. v. Lazarovitch (1940), 69 Que. K.B.
214; affirming in the result, but disapproving Alfresh Beverages Canada Corp. v. Hoechst AG,
as to this ground (sub nom. Lazarovitch v. 2002 CarswellOnt 77, 16 C.P.C. (5th) 301
Court of Sessions of the Peace) 77 Que. S.C. (Ont. S.C.J.) ............................................CA 36
68 (C.A.).................................................CA 45 Allan Morgan & Sons Ltd. v. La-Z-Boy Canada
ACA Joe Int. v. 147255 Can. Inc. (1986), 10 Ltd., 2004 Comp. Trib. 4
C.P.R. (3d) 301, 4 F.T.R. 311 (T.D.) .....................................................CA 103.1
..........................................................CA 36 Alta. Giftwares Ltd. v. R., [1974] S.C.R. 584,
Air Canada v. American Airlines Inc. (1989), 26 [1973] 5 W.W.R. 458, 11 C.P.R. (2d) 233,
C.P.R. (3d) 575 (S.C.C.) 11 C.C.C. (2d) 513, 36 D.L.R. (3d) 321
......................................................... CTA 9 ..........................................................CA 52
Air Canada v. Canada (Commissioner of Com- American Airlines Inc. v. Canada (Competition
petition), 2002 FCA 121 (Fed. C.A.); leave Trib.), see Canada (Dir. of Investigation & Re-
to appeal refused 2002 CarswellNat 3657 search) v. Air Can.
(S.C.C.) ................................................ CTA 11 American Airlines Inc. v. Canada (Competition
Air Canada v. Canada (Director of Investigation Tribunal), see Canada (Dir. of Investigation &
& Research) (1993), 51 C.P.R. (3d) 131 Research) v. Air Can.
(Competition Trib.); affirmed (1993), 51 Apotex Inc. v. Eli Lilly & Co., 2004 Car-
C.P.R. (3d) 131 at 142 (F.C.A.) swellNat 1831, 2004 FCA 232, (sub nom. Eli
..........................................................CA 73 Lilly & Co. v. Apotex Inc.) 32 C.P.R. (4th)
Albany Felt Co. of Can. v. R. (1982), 70 C.P.R. 195, 323 N.R. 180, 240 D.L.R. (4th) 679
(2d) 36, 2 C.C.C. (3d) 129, 143 D.L.R. (3d) (F.C.A) ...................................... CA 36, CA 45
691; leave to appeal to S.C.C. refused 2 Apotex Inc. v. Eli Lilly & Co. (2005), 40 C.P.R.
C.C.C. (3d) 129n, 143 D.L.R. (3d) 691n (4th) 289 (F.C.A.)
(S.C.C.) ....................................... CA 2, CA 69 ..........................................................CA 45
Alex Couture Inc. v. Canada (Attorney-General)
Apotex Inc. v. Hoffman-LaRoche Ltd. (2000), 9
(1991), 83 D.L.R. (4th) 577, 38 C.P.R. (3d)
C.P.R. (4th) 417, 195 D.L.R. (4th) 244, 139
293, [1991] R.J.Q. 2534 (C.A.); leave to ap-
O.A.C. 63 (Ont. C.A.)
peal to S.C.C. refused (1992), 91 D.L.R.
............................................ CA 36, CA 52
(4th) vii (note), 42 C.P.R. (3d) v (note), 141
N.R. 396 (note) (S.C.C.) Apotex Inc. v. Laboratoires Fournier S.A., 2006
.........................................................CA 1.1 CarswellOnt 7164, 54 C.P.R. (4th) 241 (Ont.
S.C.J.)........................................ CA 36, CA 45
Alex Couture Inc. v. Canada (Attorney-General)
(1991), 83 D.L.R. (4th) 577, 38 C.P.R. (3d) Arora v. Whirlpool Canada LP, 2012 ONSC
293, [1991] R.J.Q. 2534 (C.A.); reversing 47 4642 (Ont. S.C.J.)
B.L.R. 154, (sub nom. Alex Couture Inc. v. ..........................................................CA 52
xxiii
Table of Cases
Ashley v. Canada (Commissioner of Competi- Balanyk v. University of Toronto, 1999 Cars-

tion) (2006), 47 C.P.R. (4th) 379 (F.C.T.D.) wellOnt 1786, 1 C.P.R. (4th) 300 (Ont.
.............................................. CA 9, CA 10 S.C.J.)......................................................CA 36
Astral Média Inc. c. Canada (Commissaire de la Bank of Montreal v. Canada (Commissioner of
concurrence) (2002), (sub nom. Astral Media Competition), 2013 Comp. Trib. 12 (Compe-
Inc. v. Canada (Commissioner of Competi- tition Trib.) ...........................................CA 105
tion)) 20 C.P.R. (4th) 356 (Fed. T.D.) Barcode Systems Inc. v. Symbol Technologies
......................................................... CTA 9 Canada ULC, 2004 Comp. Trib. 1, 29 C.P.R.
Astral Media Inc. v. Canada (Commissioner of (4th) 554 (Competition Trib.)
Competition), see Astral Média Inc. c. Canada .....................................................CA 103.1
(Commissaire de la concurrence) Barcode Systems Inc. v. Symbol Technologies
Atl. Sugar Refineries Co. v. A.G. Can., [1980] 2 Canada ULC, 2004 Comp. Trib. 1, 29 C.P.R.
S.C.R. 644, 12 B.L.R. 171, 53 C.P.R. (2d) 1, (4th) 554 (Competition Trib.); affirmed
54 C.C.C. (2d) 373, 16 C.R. (3d) 128, 32 (2004), 34 C.P.R. (4th) 481 (F.C.A.)
N.R. 562, 115 D.L.R. (3d) 21 .....................................................CA 103.1
..........................................................CA 45 Barcode Systems Inc. v. Symbol Technologies
Audatex Canada, ULC v. CarProof Corporation, Canada ULC, 2004 FCA 339 (F.C.A.)
2015 Comp. Trib. 28 (Competition Trib.) ....................................................... CTA 13
..................................................... CTR 120 Bass Clef Entertainments Ltd. v. HOB Concerts
Austin v. Canada (Min. of Consumer & Canada Ltd. (2007), 31 B.L.R. (4th) 255
Corporate Affairs) (1986), 12 C.P.R. (3d) (Ont. S.C.J.) ............................................CA 45
190, 110 F.T.R. 83 (T.D.) BBM Bureau of Measurement v. Dir. of
..........................................................CA 22 Investigation & Research, [1985] 1 F.C. 173,
Axiom Plastics Inc. v. E.I. Dupont Canada Co. 82 C.P.R. (2d) 60, 12 C.C.C. (3d) 560, 9
(2007), 87 O.R. (3d) 352, 46 C.P.C. (6th) D.L.R. (4th) 600, 52 N.R. 137 (C.A.)
234 (Ont. S.C.J.); leave to appeal refused ..........................................................CA 77
(2008), 55 C.P.C. (6th) 118 (Ont. Div. Ct.) Bell Can. v. Intra Can. Telecommunications Ltd.
..........................................................CA 36 (1982), 70 C.P.R. (2d) 252 (Fed. C.A.)
..........................................................CA 62
B.C. Lightweight Aggregate Ltd. v. Can.
Cement Lafarge, [1983] 1 S.C.R. 452, [1983] Bell Canada v. Cogeco Cable Canada GP Inc.,
6 W.W.R. 385, 21 B.L.R. 254, 24 C.C.L.T. 2016 ONSC 6044 (Ont. S.C.J.)
111, 72 C.P.R. (2d) 1, 145 D.L.R. (3d) 385, ..........................................................CA 36
47 N.R. 191 ............................................CA 62 Belsat Video Marketing Inc. v. Astral
B-Filer Inc. v. Bank of, 2005 Comp. Trib. 31 Communications Inc., 1998 CarswellOnt 659,
.......................................CA 103.1, CTA 8 81 C.P.R. (3d) 1 (Ont. Gen. Div.); additional
reasons at 1998 CarswellOnt 1612 (Ont. Gen.
B-Filer Inc. v. Bank of Nova Scotia, 2006 Div.); affirmed 1999 CarswellOnt 388 (Ont.
Comp. Trib. 42 (Competition Trib.); addi- C.A.)........................................................CA 36
tional reasons at 2007 CarswellNat 5893,
2007 Comp. Trib. 26 (Competition Trib.); ad- Bernstein v. Stoytcheva-Todorova (2007), 44
ditional reasons at 2007 CarswellNat 5892, C.C.L.T. (3d) 181 (B.C. S.C.)
2007 Comp. Trib. 29 (Competition Trib.) ..........................................................CA 45
..........................................................CA 75 Bérubé v. Makita Power Tools Canada Ltd.
B. (J.D.D.) (Litigation Guardian of) v. G. (J.E.), (1991), 40 C.P.R. (3d) 108, 47 F.T.R. 287
1999 CarswellOnt 3204, [1999] O.J. No. (Fed. T.D.) ..............................................CA 36
3748 (Ont. S.C.J.); additional reasons 2000 Blank v. Canada (Department of Justice), [2006]
CarswellOnt 53 (Ont. S.C.J.) 2 S.C.R. 319 (S.C.C.)
.....................................................CA 74.01 ..........................................................CA 19
Babstock v. Atlantic Lottery Corp. Inc./Societé Boehringer Ingelheim (Canada) Inc. v. Bristol-
de Loteries de l’Atlantique, 2014 Car- Myers Squibb Canada Inc., 1998 CarswellOnt
swellNfld 281, [2014] N.J. No. 288 (N.L. 3893, 83 C.P.R. (3d) 51 (Ont. Gen. Div.)
T.D.).......................................................CA 2.1 ............................................ CA 36, CA 52
xxiv
Table of Cases
Boivin c. R., see R. v. Boivin Canada (Commissioner of Competition) v. Burns

Lake Native Development Corp., 2006 Comp.
British Columbia Recreation and Parks Assn. v.
Trib. 16 (Competition Trib.)
Zakharia, 2015 BCSC 1650 (B.C. S.C.)
......................................................... CTA 9
..........................................................CA 52
Canada (Commissioner of Competition) v.
Burns Lake Native Development Corp. v.
Canada Pipe Co. (2003), 28 C.P.R. (4th) 335
Canada (Commissioner of Competition)
(Competition Trib.)
(2006), 47 C.P.R. (4th) 343 (F.C.A.)
..........................................................CA 11
..................................... CA 106, CA 124.2
Cadillac Fairview Corp. v. Canada
(Commissioner of Competition) (2003), 29
(Competition Trib.)
C.P.R. (4th) 33 (Ont. S.C.J.)
..........................................................CA 79
..........................................................CA 11
Can. Cement Lafarge Ltd. v. B.C. Lightweight
Aggregate Ltd.........................................CA 62
(Competition Trib.); reversed 2006 Car-
Canada v. Chambre d’Immeuble du Saguenay- swellNat 1762, 2006 CarswellNat 3352
Lac St. Jean Inc. (1999), 90 A.C.W.S. (3d) (F.C.A.); leave to appeal refused 2007 Car-
378 (Fed. T.D.) swellNat 1107, 2007 CarswellNat 1108
..........................................................CA 34 (S.C.C.); reversed 2006 CarswellNat 4554,
2006 CarswellNat 1763 (F.C.A.)
Canada v. Kanzaki Specialty Papers Inc., see R. v.
..........................................................CA 78
Kanzaki Specialty Papers Inc.
Canada v. R.L. Crain Inc. (1988), 22 C.P.R.
Canada Pipe Co., 2006 CarswellNat 1763,
(3d) 462 (N.S. T.D.)
2006 FCA 233, 49 C.P.R. (4th) 241 (F.C.A.);
..........................................................CA 47
reversing 40 C.P.R. (4th) 453, 2005 Car-
Canada v. UCAR Inc., see R. v. UCAR Inc. swellNat 2348, 2005 Comp. Trib. 3 (Compe-
Canada (A.G.) v. Alex Couture Inc., see Canada tition Trib.) ............................... CA 77, CA 79
(P.G.) c. Alex Couture Inc. Canada (Commissioner of Competition) v.
Canada Pipe Co., 2007 CarswellNat 3913
Canada (Attorney General) v. United States
(Competition Trib.)
Steel Corp., 2010 FC 642 (F.C.); affirmed
..........................................................CA 77
2011 FCA 176 (Fed. C.A.)
..........................................................CA 79 Canada (Commissioner of Competition) v.
Canadian Real Estate Assn., 2015 Comp.
Trib. 3 (Comp. Trib.)
Abitibi-Consolidated Inc., 2002 Comp. Trib.
........................................................CA 106
3 (Competition Trib.)
............................ CA 92, CA 105, CTA 8 Canada (Commissioner of Competition) v.
Canadian Waste Services Holdings Inc. (June
Canada (Commissioner of Competition) v. Air
16, 2009), CT-2009-003 (Competition Trib.)
Canada (April 20, 2001), Trib. Dec. No.
..........................................................CA 79
CT2001/002/008 (Competition Trib.)
............................................CA 79, CTA 9 Canada (Commissioner of Competition) v.
Canadian Waste Services Holdings Inc., 2000
Comp. Trib. 5 (Competition Trib.)
Canada (2000), 8 C.P.R. (4th) 372 (F.C.
..........................................................CA 92
T.D.)........................................................CA 11
Canadian Waste Services Holdings Inc.
Canada, 2001 Comp. Trib. 4 (Competition
(2001), 11 C.P.R. (4th) 425 (Competition
Trib.) .......................................................CA 92
Trib.); additional reasons (2001), 15 C.P.R.
Canada (Commissioner of Competition) v. Air (4th) 5 (Competition Trib.); affirmed 2003
Canada (2002), 2002 CarswellNat 4018, 19 FCA 131, 2003 CarswellNat 2986, 2003 Car-
C.P.R. (4th) 226, 2002 Comp. Trib. 15 swellNat 643 (Fed. C.A.); leave to appeal re-
(Competition Trib.) fused 2004 CarswellNat 6 (S.C.C.)
............................CTA 8, CTA 9, CTR 34 ..........................................................CA 92
xxv
Table of Cases
Canada (Commissioner of Competition) v. Canada (Commissioner of Competition) v.

Cascades Fine Papers Group Inc., 2004 FC Saskatchewan Telecommunications, 2015 FC
95 (F.C.)..................................................CA 15 990 (F.C).................................................CA 11
Canada (Commissioner of Competition) v. Chatr Canada (Commissioner of Competition) v. Sears
Wireless Inc., 2011 ONSC 3387, 2011 Cars- Canada Inc., 37 C.P.R. (4th) 65, 2005 Comp.
wellOnt 4451 (Ont. S.C.J.) Trib. 2 (Competition Trib.)
..........................................................CA 29 .................................... CA 74.01, CA 74.1
Canada (Commissioner of Competition) v. Canada (Commissioner of Competition) v. Sears
Gestion Lebski Inc., 2006 Comp. Trib. 32 Canada Inc., 37 C.P.R. (4th) 65, 2005 Comp.
(Competition Trib.) Trib. 2 (Competition Trib.); additional rea-
......................................... CA 74.1, CA 79 sons 2005 CarswellNat 7175 (Competition
Trib.) .......................................................CA 69
Imperial Brush Co., 2008 Comp. Trib. 2, Canada (Commissioner of Competition) v. Sears
[2008] C.C.T.D. No. 2 (Competition Trib.) Canada Inc. (2003), 24 C.P.R. (4th) 534
.....................................................CA 74.01 (Competition Trib.)
..........................................................CA 29
Canada (Commissioner of Competition) v. Sears
Indigo Books & Music Inc., 2015 FC 256
Canada Inc. (2003), 28 C.P.R. (4th) 369
(Fed. Ct.).................................................CA 11
(Competition Trib.)
Canada (Commissioner of Competition) v. ....................................................... CTR 34
Labatt Brewing Co., 2007 CarswellNat 1611 Canada (Commissioner of Competition) v. Sears
(Competition Trib.); affirmed 2008 Car- Canada Inc. (2003), 28 C.P.R. (4th) 385
swellNat 134, 2008 CarswellNat 708 (F.C.A.) (Competition Trib.)
.......................................... CA 10, CA 100 ....................................................... CTR 38
Labatt Brewing Co., 2008 FC 59 (F.C.T.D.) Superior Propane
..........................................................CA 11 .........................................................CA 1.1
Moosehead Breweries Ltd., 2008 FC 105 Superior Propane Inc. (August 24, 1999)
(F.C.T.D.)................................................CA 11 (Comp. Trib., Nadon J.)
....................................................... CTR 60
Canada (Commissioner of Competition) v. P.V.I.
International Inc. (2004), 31 C.P.R. (4th) 331 Canada (Commissioner of Competition) v.
(F.C.A.) .................................................. CTA 9 Superior Propane Inc., 11 C.P.R. (4th) 289,
2001 FCA 104, 199 D.L.R. (4th) 130, 269
Canada (Commissioner of Competition) v. P.V.I. N.R. 109, [2001] 3 F.C. 185, 2001 Car-
International Inc. (2004), 31 C.P.R. (4th) 331 swellNat 702, 2001 CarswellNat 2092 (Fed.
(F.C.A.); varying (2002), 19 R.P.R. (4th) 129 C.A.).......................................................CA 1.1
(Competition Trib.)
.................................. CA 74.01, CA 74.11 Canada (Commissioner of Competition) v.
Superior Propane Inc., 11 C.P.R. (4th) 289,
Canada (Commissioner of Competition) v. 2001 FCA 104, 199 D.L.R. (4th) 130, 269
Pearson Canada Inc., 2014 CarswellNat 1313, N.R. 109, [2001] 3 F.C. 185, 2001 Car-
[2014] F.C.J. No. 430 (F.C.) swellNat 702, 2001 CarswellNat 2092 (Fed.
..........................................................CA 11 C.A.); leave to appeal refused 2001 Car-
Canada (Commissioner of Competition) v. swellNat 1905 (S.C.C.)
Phone Directories Inc. (May 10, 2002), CT- ................ CA 1.1, CA 92, CA 96, CTA 3
2002/02 (Competition Trib.) Canada (Commissioner of Competition) v.
.....................................................CA 74.12 Superior Propane Inc. (2000), 261 N.R. 50,
Canada (Commissioner of Competition) v. [2001] 3 F.C. 175, 2000 CarswellNat 2172,
Premier Career Management Group Corp., 2000 CarswellNat 3577 (Fed. C.A.)
2009 FCA 295 (Fed. C.A.); reversing 2008 ........................................................CA 104
Comp. Trib. 18 (Competition Trib.) Canada (Commissioner of Competition) v.
.....................................................CA 74.01 Superior Propane Inc., 2002 Comp. Trib. 16,
xxvi
Table of Cases
18 C.P.R. (4th) 417 (Competition Trib.); af- Canada (Competition Bureau) v. Chatr Wireless
firmed (2003), 23 C.P.R. (4th) 316 (Fed. Inc. .....................................................CA 74.03
C.A.).......................................... CA 92, CA 96 Canada (Competition Bureau) v. Chatr Wireless
Canada (Commissioner of Competition) v. Inc., 2013 ONSC 5315 (Ont. S.C.J.)
Superior Propane Inc., 2003 FCA 53 (Fed. .... CA 74.01, CA 74.1, CA 74.03, CA 79
C.A.)........................................................CA 96 Canada (Dir. of Investigation & Research) v.
Canada (Commissioner of Competition) v. Air Can., (sub nom. American Airlines Inc.
Toronto Real Estate Board, 2017 FCA 236; v. Canada (Competition Tribunal)) [1989] 1
leave to appeal to S.C.C. refused 2018 Car- S.C.R. 236, 23 C.P.R. (3d) 178n, 92 N.R.
swellNat 4555 (S.C.C.) 320, 26 C.P.R. (3d) 95
..........................................................CA 79 ......................................................... CTA 9
Canada (Commissioner of Competition) v. Canada (Dir. of Investigation & Research) v.
Toshiba of Canada Ltd., 2010 CarswellOnt Air Can. (1988), [1989] 2 F.C. 88, 33 Ad-
381 (Ont. S.C.J.) min. L.R. 229, 23 C.P.R. (3d) 178, (sub nom.
..........................................................CA 11 American Airlines Inc. v. Canada
Canada (Commissioner of Competition) v. (Competition Trib.)) 89 N.R. 241, 54 D.L.R.
Trilogy Enterprises L.P. (May 17, 2001), (4th) 741 (C.A.); affirmed [1989] 1 S.C.R.
Trib. Dec. No. CT2001/003/023 (Competition 236, 26 C.P.R. 95, 92 N.R. 320, 23 C.P.R.
Trib.) ...................................................... CTA 9 (3d) 178n ............................... CTA 9, CTA 13
Trilogy Retail Enterprises L.P., 2001 Comp. Air Can. (1989), 37 Admin. L.R. 95, 24
Trib. 29, 14 C.P.R. (4th) 216 (Competition C.P.R. (3d) 29 (Comp. Trib.)
Trib.) .......................................CA 105, CTA 8 ......................................................... CTA 9
United Grain Growers Limited, 2002 Comp. Chrysler Canada Ltd. (1989), 27 C.P.R. (3d)
Trib. 1 (Competition Trib.) 1 (Competition Trib.); affirmed (1991), 38
..........................................................CA 92 C.P.R. (3d) 25, 129 N.R. 77 (Fed. C.A.);
leave to appeal to S.C.C. refused (1992), 41
Canada (Commissioner of Competition) v. C.P.R. (3d) v (note), 138 N.R. 319 (note)
United Grain Growers Ltd. (2002), 19 C.P.R. (S.C.C.) ...................................................CA 75
(4th) 157 (Competition Trib.)
......................................................... CTA 9 Canada (Dir. of Investigation & Research) v.
Imperial Oil (1990), 31 C.P.R. (3d) 277
Canada (Commissioner of Competition) v. (Competition Trib.); affirmed (1992), 41
Universal Payphone Systems Inc. (September C.P.R. (3d) 483 (Fed. C.A.)
24, 1999) (Comp. Trib., Lutfy J.) ........................................................CA 106
.....................................................CA 74.11
Canada (Dir. of Investigation & Research) v.
Canada (Commissioner of Competition) v. Imperial Oil (1990), 31 C.P.R. (3d) 277
3628159 Canada Inc. (c.o. Antirouilles (Competition Trib.); affirmed (1992), 41
Electroniques TP), Garantie Express Inc. and C.P.R. (3d) 493 (Fed. C.A.)
Jacques Nadeau (December 12, 2001), Doc. ......................................... CTA 9, CTA 13
CT-2001/006 (Competition Trib.)
.....................................................CA 74.12 Canada (Dir. of Investigation & Research) v.
Imperial Oil (1990), 31 C.P.R. (3d) 284 (Fed.
Canada (Commissioner of Competition) v C.A.)..................................................... CTA 13
Superior Propane Inc, 2000 Comp. Trib. 15,
7 C.P.R. (4th) 385 Canada (Dir. of Investigation & Research) v.
.......................................... CA 96, CA 104 Irving Equipment, see Dir. of Investigation &
Research v. Irving Equipment, a division of
Canada (Commissioner of Competition) v J.D. Irving Ltd.
Superior Propane Inc, 2000 Comp. Trib. 15,
7 C.P.R. (4th) 385; reversed 2001 Car- Canada (Dir. of Investigation & Research) v.
swellNat 702, 2001 CarswellNat 2092 (Fed. NutraSweet Co. (1989), 27 C.P.R. (3d) 446
C.A.); leave to appeal refused 2001 Car- (Fed. C.A.)............................................. CTA 9
swellNat 1905, 2001 CarswellNat 1906 Canada (Dir. of Investigation & Research under
(S.C.C.) ...................................................CA 96 the Competition Act) v. Calgary Real Estate
xxvii
Table of Cases
Bd. Co-op Ltd., [1987] 3 F.C. 676, 13 F.T.R. Canada (Director of Investigation & Research)
303, 16 C.P.R. (3d) 529 (T.D.) v. Canadian Pacific Ltd. (1997), 74 C.P.R.
..........................................................CA 15 (3d) 55 (Competition Trib.)
Canada (Director of Investigation and Research) ......................................................... CTA 8
v. Southam Inc. Canada (Director of Investigation & Research)
..........................................................CA 92 v. Canadian Pacific Ltd. (1997), 74 C.P.R.
Canada (Director of Investigation & Research) (3d) 167 (Competition Trib.)
v. ADM Agri-Industries, Ltd. (May 8, 1998) ............................................CA 11, CTA 9
(Competition Trib.) Canada (Director of Investigation & Research)
..........................................................CA 92 v. Cast Group Ltd. (1995), 61 C.P.R. (3d)
Canada (Director of Investigation & Research) 219 (Competition Trib.)
v. AGT Directory Ltd. (1994), [1994] ..........................................................CA 12
C.C.T.D. No. 24, 1994 CarswellNat 3198 Canada (Director of Investigation & Research)
(Competition Trib.) v. Chrysler Canada Ltd. (1992), 44 C.P.R.
..........................................................CA 79 (3d) 430 (Competition Trib.)
Canada (Director of Investigation & Research) ......................................................... CTA 8
v. Air Canada (1992), 46 C.P.R. (3d) 184 Canada (Director of Investigation & Research)
(Competition Trib.) v. D & B Co. of Canada Ltd. (1995), 64
......................................................... CTA 9 C.P.R. (3d) 216 (Competition Trib.)
Canada (Director of Investigation & Research) ............................................ CA 78, CA 79
(Competition Trib.) v. Hillsdown Holdings (Canada) Ltd. (1992),
....... CA 10, CA 11, CA 19, CA 29, CTR 41 C.P.R. (3d) 289 (Competition Trib.)
60 ............................................ CA 92, CA 96
Canada (Director of Investigation & Research) Canada (Director of Investigation & Research)
v. Air Canada (1993), 49 C.P.R. (3d) 7 v. Laidlaw Waste Systems Ltd. (1992), 40
(Competition Trib.); reversed [1994] 1 F.C. C.P.R. (3d) 289 (Competition Trib.)
154, 49 C.P.R. (3d) 417, 104 D.L.R. (4th) ..........................................................CA 79
129, 157 N.R. 258 (C.A.); leave to appeal
Canada (Director of Investigation & Research)
refused (1993), 49 C.P.R. (3d) ix (note), 104
v. NutraSweet Co. (1990), 32 C.P.R. (3d) 1
D.L.R. (4th) vii (note) (S.C.C.)
(Competition Trib.)
........................................................CA 106
...CA 15, CA 77, CA 78, CA 79, CTA 3,
Canada (Director of Investigation & Research) CTA 5
v. Air Canada (1993), 50 C.P.R. (3d) 49
(Competition Trib.) Canada (Director of Investigation & Research) v.
......................................................... CTA 5 Softkey Software Products Inc., see Softkey
Software Products Inc., Re
(Competition Trib.) v. Southam Inc. (1991), 38 C.P.R. (3d) 390
..........................................................CA 92 (Competition Trib.)
.............................CA 10, CA 29, CTR 60
v. Bank of Montreal (1996), 68 C.P.R. (3d) Canada (Director of Investigation & Research)
527 (Competition Trib.) v. Southam Inc. (1992), 43 C.P.R. (3d) 161
..........................................................CA 79 (Competition Trib.); additional reasons
(1993), 48 C.P.R. (3d) 224 (Competition
Canada (Director of Investigation & Research) Trib.); reversed [1995] 3 F.C. 557, 21 B.L.R.
v. Canadian Pacific Ltd. (1997), 73 C.P.R. (2d) 1, 63 C.P.R. (3d) 1, 127 D.L.R. (4th)
(3d) 573 (Competition Trib.) 263, (sub nom. Director of Investigation &
..........................................................CA 96 Research, Competition Act v. Southam Inc.
Canada (Director of Investigation & Research) (No. 1)) 185 N.R. 321 (Fed. C.A.); reversed
v. Canadian Pacific Ltd. (1997), 74 C.P.R. 1997 CarswellNat 368, 1997 CarswellNat
(3d) 37 (Competition Trib.) 369, [1997] 1 S.C.R. 748, 209 N.R. 20
......................................................... CTA 9 (S.C.C.) ...................................................CA 92
xxviii
Table of Cases
Canada (Director of Investigation & Research) Canada (Director of Investigation & Research,
v. Southam Inc. (1992), 43 C.P.R. (3d) 161 Competition Act) v. Canadian International
(Competition Trib.); additional reasons at Trade Tribunal (1993), 52 C.P.R. (3d) 71,
(1993), 48 C.P.R. (3d) 224 (Competition 164 N.R. 254 (Fed. C.A.)
Trib.); reversed in part [1995] 3 F.C. 557, 21 ........................................................CA 125
B.L.R. (2d) 1, 63 C.P.R. (3d) 1, 127 D.L.R.
(4th) 263, (sub nom. Director of Investigation Canada (P.G.) c. Alex Couture Inc., [1987]
& Research, Competition Act v. Southam R.J.Q. 1971, (sub nom. Canada (A.G.) v.
Inc. (No. 1)) 185 N.R. 321 (C.A.); leave to Alex Couture Inc.) 18 C.P.R. (3d) 382, (sub
appeal to S.C.C. granted (1996), 64 C.P.R. nom. Couture (Alex) Inc. c. Canada (P.G.))
(3d) vi (note), 130 D.L.R. (4th) vi (note) 14 Q.A.C. 259 (C.A. Qué.)
(S.C.C.); reversed Canada (Director of ....................................................... CTA 13
Investigation & Research) v. Southam Inc. Canadian Pacific Ltd. v. Canada (Director of
(1997), 50 Admin. L.R. (2d) 199, 144 D.L.R. Investigation & Research) (1995), 61 C.P.R.
(4th) 1, [1996] S.C.J. No. 116, 71 C.P.R. (3d) 137 (Ont. Gen. Div.)
(3d) 417, [1997] 1 S.C.R. 748, 209 N.R. 20, ..........................................................CA 11
1997 CarswellNat 368, 1997 CarswellNat 369
(S.C.C.) ................................................ CTR 77 Canadian Pacific Ltd. v. Canada (Director of
Investigation & Research) (1997), 74 C.P.R.
Canada (Director of Investigation & Research) (3d) 65 (Ont. Gen. Div. [Commercial List])
v. Southam Inc. (1998), 78 C.P.R. (3d) 428 ..........................................................CA 23
(Competition Trib.)
..........................................................CA 92 Canadian Standard Travel Agent Registry v.
International Air Transport Assn., 2008 Car-
Canada (Director of Investigation & Research) swellNat 2589, 2008 Comp. Trib. 12 (Com-
v. Superior Propane Inc. (1998), 85 C.P.R. petition Trib.)........................................CA 104
(3d) 192 (Competition Trib.)
........................................................CA 100 Canadian Standard Travel Agent Registry v.
International Air Transport Assn., 2008 Com-
petition Trib. 14, 2008 CarswellNat 2593
v. Superior Propane Inc. (1998), 85 C.P.R.
(Competition Trib.)
(3d) 194 (Competition Trib.)
.....................................................CA 103.1
........................................................CA 100
Canadian Waste Services Holdings Inc. v.
Canada (Commissioner of Competition)
v. Tele-Direct (Publications) Inc. (1997), 73
(2004), 33 C.P.R. (4th) 267 (Fed. C.A.)
C.P.R. (3d) 1 (Competition Trib.)
........................................................CA 106
............................................ CA 77, CA 79
Canada (Director of Investigation & Research) Canadian Waste Services Holdings Inc. v.
v. Thomson Corp. (1998), 84 C.P.R. (3d) 8 Canada (Commissioner of Competition)
(F.C.T.D.)................................................CA 11 (2004), 33 C.P.R. (4th) 275 (Competition
Trib.) .....................................................CA 106
v. Warner Music Canada Ltd. (1997), 78 CarGurus, Inc. v. Trader Corporation, 2016
C.P.R. (3d) 321 (Competition Trib.) Comp. Trib. 15 (Competition Trib.); affirmed
..........................................................CA 75 2017 CarswellNat 4278 (F.C.A.)
.....................................................CA 103.1
Canada (Director of Investigation & Research) v.
Warner Music Group Inc., see Warner Music Carom v. Bre-X Minerals Ltd. (1998), 82 C.P.R.
Group Inc., Re (3d) 187, 20 C.P.C. (4th) 187 (Ont. Gen.
Div.) .......................................... CA 36, CA 52
Canada (Director of Investigation & Research) v.
Warner Music Group Ltd., see Warner Music CC&L Dedicated Enterprise Fund (Trustee of)
Group Inc., Re v. Fisherman (2001), (sub nom. Mondor v.
Fisherman) 15 C.P.R. (4th) 289 (Ont. S.C.J.)
Canada (Director of Investigation & Research) ..........................................................CA 52
v. Xerox Canada Inc. (1990), 33 C.P.R. (3d)
83 (Competition Trib.) Chadha v. Bayer Inc.
..........................................................CA 75 ..........................................................CA 36
xxix
Table of Cases
Chadha v. Bayer Inc. (1998), 82 C.P.R. (3d) 202 24 C.P.R. (3d) 417, 58 D.L.R. (4th) 255, 93
(Ont. Gen. Div.) N.R. 326, 32 O.A.C. 332
..........................................................CA 79 ..........................................................CA 36
Chadha v. Bayer Inc. (2001), 200 D.L.R. (4th) City National Leasing Ltd. v. General Motors of
309, 54 O.R. (3d) 520, 15 B.L.R. (3d) 177 Canada Ltd., [1989] 1 S.C.R. 641 (S.C.C.)
(Ont. Div. Ct.); reversing (1999), 45 O.R. ..........................................................CA 75
(3d) 29, 36 C.P.C. (4th) 188 (Ont. S.C.J.); Clarke Transport Can. Inc., Re (1987), 16
additional reasons at (1999), 43 C.P.C. (4th) C.P.R. (3d) 173 (Ont. H.C.)
91 (Ont. S.C.J.); affirmed (2003), 2003 Cars- ..........................................................CA 15
wellOnt 49, 223 D.L.R. (4th) 158, 168
O.A.C. 143, 63 O.R. (3d) 22, 31 B.L.R. (3d) Commissioner of Competition v. ADM Agri-
214, 23 C.L.R. (3d) 1, 31 C.P.C. (5th) 40 Industries Ltd., 1997 Comp. Trib. 2
(Ont. C.A.); additional reasons at (2003), ..........................................................CA 92
2003 CarswellOnt 1205, 170 O.A.C. 126 Commissioner of Competition v. Air Canada,
(Ont. C.A.); leave to appeal refused (2003), 2003 Comp. Trib. 13 (Competition Trib.)
2003 CarswellOnt 2810, 2003 CarswellOnt ............................................ CA 78, CA 79
2811 (S.C.C.)..........................................CA 36
Commissioner of Competition v. Air Canada,
Charette v. Canada (Commissioner of Competi- 2012 Comp. Trib. 20 (Competition Trib.)
tion) (2003), 29 C.P.R. (4th) 1 (Fed. C.A.) ....................................................... CTR 70
..........................................................CA 10
Commissioner of Competition v. American Iron
Chrysler Canada Ltd. v. Canada (Competition & Metal Company Inc. (2008), CT-2008-001
Tribunal), [1992] 2 S.C.R. 394, 12 Admin. (Competition Trib.)
L.R. (2d) 1, 7 B.L.R. (2d) 1, 42 C.P.R. (3d) ........................................................CA 100
353, 92 D.L.R. (4th) 609; reversing [1990] 2
Commissioner of Competition v. Aviscar Inc.,
F.C. 565, 48 B.L.R. 125, 31 C.P.R. (3d) 510,
2015 Comp. Trib. 12 (Competition Trib.)
111 N.R. 368 (C.A.)
..........................................................CA 92
......................................................... CTA 8
Commissioner of Competition v. Bauer
Cinémas Guzzo Inc. v. Canada (Attorney Performance Sports Ltd., Court File No. T-
General)...................................................CA 75 1354-13 ...................................................CA 12
Cinémas Guzzo Inc. v. Canada (Attorney Gen- Commissioner of Competition v. British
eral), see Cinémas Guzzo Inc. c. Canada American Tobacco, 1999 Comp. Trib. 1
(Procureur général) ..........................................................CA 92
Cinémas Guzzo Inc. v. Canada (Attorney Gen- Commissioner of Competition v. C.C.S. Corp.,
eral), [2005] F.C.J. No. 863 2011 Comp. Trib. 23 (Competition Trib.)
..........................................................CA 75 ..........................................................CA 91
Cinémas Guzzo Inc. c. Canada (Procureur gén- Commissioner of Competition v. Canadian
éral) (2005), (sub nom. Cinémas Guzzo Inc. Waste Services Holdings Inc. (2000–2005)
v. Canada (Attorney General)) 47 C.P.R. ..........................................................CA 92
(4th) 250 (F.C.); affirmed 2006 CarswellNat
1294, 2006 CAF 160 (F.C.A.); leave to ap- Commissioner of Competition v. CCS
peal refused (2006)), 2006 CarswellNat 3847, Corp.(Tervita) (2010–2015)
2006 CarswellNat 3848 (S.C.C.) ..........................................................CA 92
..........................................................CA 10 Commissioner of Competition v. CCS Corpora-
Citizens Ins. Co. of Can. v. Parsons (1881), 7 tion, 2011 Comp. Trib. 4 (Competition Trib.)
App. Cas. 96...........................................CA 77 ..........................................................CA 92
City Nat. Leasing Ltd. v. Gen. Motors of Can. Commissioner of Competition v. Direct Energy
Ltd. (1984), 47 O.R. (2d) 653, 28 B.L.R. 41, Marketing Limited, 2015 Comp. Trib. 2
45 C.P.C. 174, 3 C.P.R. (3d) 262, 12 D.L.R. (Competition Trib.)
(4th) 273 (H.C.); reversed in part (1986), 54 ..........................................................CA 79
O.R. (2d) 626, 9 C.P.R. (3d) 134, 28 D.L.R. Commissioner of Competition v. Direct Energy
(4th) 158 (C.A.); affirmed [1989] 1 S.C.R. Marketing Ltd., 2013 Comp. Trib. 16 (Com-
641, 68 O.R. (2d) 512 (note), 43 B.L.R. 225, petition Trib.)......................................... CTA 9
xxx
Table of Cases
Commissioner of Competition v. Easton Sports Couture v. Hewison, [1983] 2 W.W.R. 267, 41

Canada, Inc., Court File No. T-1371-13 B.C.L.R. 233, 71 C.P.R. (2d) 189, 3 C.C.C.
(2013)......................................................CA 12 (3d) 52, 145 D.L.R. (3d) 55 (C.A.)
Commissioner of Competition v. HarperCollins .............................................. CA 4, CA 11
Publishers LLC, 2017 Comp. Trib. 5 (Com- Couture (Alex) Inc. c. Canada (P.G.), see Canada
petition Trib.)......................................... CTA 9 (P.G.) c. Alex Couture Inc.
Commissioner of Competition v. Parkland
Croteau v. Corp de St. Joseph de Coleraine
Industries Ltd. (2015)
(1936), 42 R. de Jur. 401
..........................................................CA 92
..........................................................CA 86
Commissioner of Competition v. Parkland
Industries Ltd, 2015 Comp. Trib. 4 (Competi- Culhane v. ATP Aero Training Products Inc.
tion Trib.)................................ CA 92, CA 104 (2004), 31 C.P.R. (4th) 113 (F.C.); affirmed
(2005), 39 C.P.R. (4th) 20, 252 D.L.R. (4th)
Commissioner of Competition v. Saskatchewan
340 (F.C.A.); leave to appeal refused (2005),
Telecommunications, Tbaytel, Rogers
256 D.L.R. (4th) vi (S.C.C.)
Communications Inc., Videotron Ltd., Bragg
..........................................................CA 36
Communications, Telus Corporation, MTS
Inc., Bell Mobility Inc. Cutter (Canada) Ltd. v. Baxter Travenol
..........................................................CA 11 Laboratories of Canada Ltd. (1984), 1 C.P.R.
Commissioner of Competition v. Saskatchewan (3d) 289 (Fed. C.A.)
Wheat Pool Inc., 2006 Comp. Trib. 9 (Com- ..........................................................CA 96
petition Trib.)..........................................CA 92 Cutter (Canada) Ltd. v. Baxter Travenol
Commissioner of Competition v. Sport Maska Laboratories of Canada Ltd. (1984), 1 C.P.R.
Inc., Court File No. T-1365-13 (3d) 289 (Fed. C.A.); leave to appeal refused
..........................................................CA 12 (1984), 57 N.R. 159 (S.C.C.)
Commissioner of Competition v. Superior ..........................................................CA 96
Propane Inc. (1998–2003) D & B Co. of Canada v. Canada (Director of
..........................................................CA 92 Investigation & Research) (1994), 58 C.P.R.
Commissioner of Competition v. Thoma Bravo, (3d) 342, (sub nom. Director of Investigation
LLC, 2019 Comp. Trib. 2 & Research, Competition Act v. D & B Cos.
..........................................................CA 92 of Canada) 175 N.R. 306 (Fed. C.A.)
Commissioner of Competition v. Toronto Real ....................................................... CTA 13
Estate Board (2016), 2016 CarswellNat 1506, D & B Co. of Canada v. Canada (Director of
2016 Comp. Trib. 7 Investigation & Research) (1994), 58 C.P.R.
..........................................................CA 79 (3d) 342 at 348, (sub nom. Director of
Commissioner of Competition v. Vidéotron Investigation & Research, Competition Act v.
Télécom Ltée and Sylvain Gelina (2003), D & B Cos. of Canada) 175 N.R. 312 (Com-
Federal Court File No. T-556-03 petition Trib.)..........................CA 73, CTA 13
..........................................................CA 12
Demone Monuments and Granite Products Ltd.
Commissioner of Competition v. Visa Canada v. Heritage Memorials Ltd., 2015 NSSC 314
Corp., 2011 Comp. Trib. 2 (Competition (N.S. S.C.) ..............................................CA 52
Trib.) ...................................................... CTA 9
Descôteaux v. Mierzwinski, [1982] 1 S.C.R.
Commissioner of Competition v. Visa Canada
860, 141 D.L.R. (3d) 590 (S.C.C.)
Corporation, 2013 Comp. Trib. 10, 2013 Car-
..........................................................CA 19
swellNat 3285 (Competition Trib.)
............................................ CA 76, CA 79 Dir. of Investigation and Research v. Restrictive
Commissioner of Competition v. WestJet Trade Practices Comm. (1985), 4 C.P.R. (2d)
Airlines Ltd. et al., Court File No. T-2082-18 59, 20 C.C.C. (3d) 476, 18 D.L.R. (4th) 750
..........................................................CA 79 (Fed. C.A.)..............................................CA 11
Construx Engineering Corp. v. General Motors Dir. of Investigation & Research v. Bombardier
of Canada, 2005 Comp. Trib. 21 (Competi- Ltd. (1980), 53 C.P.R. (2d) 47 (R.T.P.
tion Trib.)...........................................CA 103.1 Comm.) ...................................................CA 77
xxxi
Table of Cases
Dir. of Investigation & Research v. Broadcast Director of Investigation and Research) v.

News Ltd. (1986), 8 C.P.R. (3d) 537 (R.T.P. Southam Inc. (1989–1997)
Comm.) .....................................CA 77, CTA 9 ..........................................................CA 92
Dir. of Investigation & Research v. Broadcast Director of Investigation and Research) v.
News Ltd. (1986), 9 C.P.R. (3d) 429 (R.T.P. Warner Music Canada Ltd.
Comm.) ...................................................CA 77 ..........................................................CA 75
Dir. of Investigation & Research v. Irving Director of Investigation & Research v.
Equipment, a division of J.D. Irving Ltd. Hillsdown Holdings (Canada) Ltd.
(1986), [1988] 1 F.C. 27, (sub nom. Canada (1990–1992)............................................CA 92
(Dir. of Investigation & Research) v. Irving Director of Investigation & Research,
Equipment) 8 F.T.R. 107, 33 C.C.C. (3d) Competition Act v. D & B Cos. of Canada, see
447, 27 C.R.R. 78, 16 C.P.R. (3d) 26, 39 D & B Co. of Canada v. Canada (Director of
D.L.R. (4th) 341 (T.D.) Investigation & Research)
...............................CA 15, CA 17, CA 18
Dom. Supply Co. v. T.L. Robertson Mfg. Co.
Dir. of Investigation & Research v. Palm Dairies (1917), 39 O.L.R. 495, 34 D.L.R. 740 (S.C.)
Ltd. (1986), 12 C.P.R. (3d) 425 (Comp. ..........................................................CA 62
Trib.) .......................................................CA 92 Dominion Ready Mix Inc. c. Rocois
Dir. of Investigation & Research appointed Construction Inc., (sub nom. Rocois
under the Competition Act v. Hoffman-La Construction Inc. v. Québec Ready Mix Inc.)
Roche Ltd. (1987), (sub nom. Goldman v. [1990] 2 S.C.R. 440, 31 Q.A.C. 241, 112
Hoffman-La Roche Ltd.) 60 O.R. (2d) 161, N.R. 241 (S.C.C.)
16 C.P.R. (3d) 289, 35 C.C.C. (3d) 488, 22 ..........................................................CA 36
O.A.C. 85, 42 D.L.R. (4th) 436 (C.A.) Dow Chemical Canada ULC v. NOVA
..........................................................CA 15 Chemicals Corporation, 2018 ABQB 482
Dir. of Investigation & Research (Competition .......................................................CA 90.1
Act) v. Irving Equipment, see Dir. of Investi- Dow Chemical Canada ULC v. NOVA
gation & Research under the Competition Act Chemicals Corporation, 2018 ABQB 482
v. Irving Equipment, a division of J.D. Irving (Alta. Q.B.) .............................................CA 45
Ltd.
Du Pont Canada Inc. v. Dennis (1993), 50
Dir. of Investigation & Research under the C.P.R. (3d) 53 (Ont. Gen. Div.)
Competition Act v. Irving Equipment, a ..........................................................CA 45
division of J.D. Irving Ltd. (1986), 12 C.P.R.
Duha Printers (Western) Ltd. v. R., [1998] 1
(3d) 137, (sub nom. Dir. of Investigation &
S.C.R. 795.................................................CA 2
Research (Competition Act) v. Irving Equip-
ment) 8 F.T.R. 23 (F.C.T.D.) Dunsmuir v. New Brunswick, see New Brunswick
..........................................................CA 15 (Board of Management) v. Dunsmuir
Direct Lumber Co. v. Western Plywood Co., Durand c. Subway Franchise Systems of Can-
[1962] S.C.R. 646, 39 W.W.R. 43, 35 D.L.R. ada, 2019 QCCS 477 (C.S. Que.)
(2d) 1 ......................................................CA 62 ..........................................................CA 52
Director of Investigation and Research v. Air Ed Miller Sales & Rentals Ltd. v. Caterpillar
Canada, 1988 Comp. Trib. 1 Tractor Co. (1988), 22 C.P.R. (3d) 290, 90
..........................................................CA 92 A.R. 323, 61 Alta. L.R. (2d) 319 (Alta. C.A.)
..........................................................CA 19
Director of Investigation and Research v. Asea
Ed Miller Sales & Rentals Ltd. v. Caterpiller
Brown Boveri Inc., 1989 Comp. Trib. 1
Tractor Co., 17 Alta. L.R. (3d) 251, 54
..........................................................CA 92
C.P.R. (3d) 1, [1994] 5 W.W.R. 473, 151
Director of Investigation and Research v. Dennis A.R. 1 (Q.B.); additional reasons at (1994),
Washington, 1996 Comp. Trib. 1 26 Alta. L.R. (3d) 16, [1995] 3 W.W.R. 716,
..........................................................CA 92 170 A.R. 341 (Q.B.)
Director of Investigation and Research v. ..........................................................CA 45
Imperial Oil Limited, 1989 Comp. Trib. 1 Eli Lilly & Co. v. Apotex Inc., see Apotex Inc. v.
..........................................................CA 92 Eli Lilly & Co.
xxxii
Table of Cases
Eli Lilly & Co. v. Apotex Inc. (2005), 44 C.P.R. Garford Pty Ltd. v. Dywidag Systems
(4th) 1 (F.C.A.); reversing (2004), 35 C.P.R. International Canada Ltd., 2012 FCA 48
(4th) 155, [2005] 2 F.C.R. 225 (F.C.) (Fed. C.A.)..............................................CA 36
..........................................................CA 45
Garland v. Consumers’ Gas Co., [2004] 1
Eli Lilly & Co. v. Apotex Inc., 2009 FC 991 S.C.R. 629 (S.C.C.)
(F.C.T.D.)................................................CA 69 ..........................................................CA 45
Energizer Brands, LLC v. The Gillette Com- Gauthier v. Canada (Consumer & Corporate Af-
pany, 2020 FCA 49 (Fed. C.A.) fairs) (1991), (sub nom. Gauthier v. Director
..........................................................CA 52 of Investigation & Research, Competition
Evans v. General Motors of Canada Co., 2019 Act) 139 N.R. 77 (F.C.A.)
SKQB 98, 2019 CarswellSask 190, [2019] 10 ..........................................................CA 10
W.W.R. 725 (Sask. Q.B.) Gauthier v. Director of Investigation & Research,
..........................................................CA 36 Competition Act, see Gauthier v. Canada
Ewert v. Nippon Yusen Kabushiki Kaisha, 2019 (Consumer & Corporate Affairs)
BCCA 187, 2019 CarswellBC 1478, 25 Genentech Canada Inc., Re (1992), 44 C.P.R.
B.C.L.R. (6th) 268, 34 C.P.C. (8th) 312 (3d) 316 (Can. Patented Medicine Prices Re-
(B.C. C.A.); leave to appeal refused 2019 view Bd.); stay granted (1992), (sub nom.
CarswellBC 3827 (S.C.C.); reversed in part Genentech Inc. v. Canada (Patented Medicine
2017 BCSC 2357 (B.C. S.C.) Prices Review Bd.)) 44 C.P.R. (3d) 335 (Fed.
..........................................................CA 36 T.D.)........................................................CA 32
Fairhurst v. Anglo American PLC, 2014 BCSC
Giftwares Wholesale Co. v. Rodger, [1977] 4
2270 (B.C. S.C.)
W.W.R. 326, 32 C.P.R. (2d) 243, (sub nom.
..........................................................CA 36
R. v. Giftwares Wholesale Co.) 36 C.C.C.
Floyd v. Edmonton City Dairy, [1934] 3 (2d) 330 (Man. Co. Ct.)
W.W.R. 326, 62 C.C.C. 254, [1935] 1 D.L.R. ..........................................................CA 60
754 (Alta. S.C.)
Goldman v. Hoffman-La Roche Ltd., see Dir. of
..........................................................CA 62
Investigation & Research appointed under the
Forest Protection Act v. Bayer A.G., see Forest Competition Act v. Hoffman-La Roche Ltd.
Protection Ltd. v. Bayer AG
Goodyear Tire & Rubber Co. of Can. v. R.,
Forest Protection Ltd. v. Bayer A.G., see Forest [1956] S.C.R. 303, 26 C.P.R. 1, 114 C.C.C.
Protection Ltd. v. Bayer AG 380, 2 D.L.R. (2d) 11
Forest Protection Ltd. v. Bayer AG (1996), (sub ..........................................................CA 34
nom. Forest Protection Ltd. v. Bayer A.G.) Gordon v. Imp. Tobacco Sales Co. of Can.,
68 C.P.R. (3d) 59, 178 N.B.R. (2d) 129, 454 [1939] O.R. 122, 71 C.C.C. 322, [1939] 2
A.P.R. 129 (Q.B.); leave to appeal refused D.L.R. 27 (H.C.)
(July 2, 1996), Doc. 131/96/CA, 132/96/CA, ..........................................................CA 62
134/96/CA (N.B. C.A.); leave to appeal re-
fused (1996), 182 N.B.R. (2d) 319 (note), Grampian Realties Co. v. Montreal East, [1932]
463 A.P.R. 319 (note), 182 N.B.R. (2d) 320 1 D.L.R. 705 (S.C.C.)
(note), 463 A.P.R. 320 (note), 206 N.R. 159 ..........................................................CA 86
(note) (S.C.C.) ........................................CA 29 Harbord Insurance Services Ltd. v. Insurance
Forest Protection Ltd. v. Bayer AG (1998), (sub Corp. of British Columbia (1993), 13
nom. Forest Protection Act v. Bayer A.G.) 84 C.C.L.I. (2d) 262, 9 B.L.R. (2d) 81 (B.C.
C.P.R. (3d) 187, (sub nom. Forest Protection S.C.) ........................................................CA 77
Act v. Bayer A.G.) 169 D.L.R. (4th) 374,
Harmegnies c. Toyota Canada, 2007 QCCS 539,
207 N.B.R. (2d) 50, 529 A.P.R. 50 (N.B.
2007 CarswellQue 926 (Que. S.C.); affirmed
C.A.)........................................................CA 36
2008 QCCA 380, 2008 CarswellQue 1155
Freeway Plymouth Chrysler Ltd. v. R., [1986] (Que. C.A.); leave to appeal refused 2008
B.C.W.L.D. 448 (Co. Ct.) CarswellQue 9014 (S.C.C.)
..........................................................CA 52 ..........................................................CA 36
xxxiii
Table of Cases
Harmegnies c. Toyota Canada, 2008 Carswell- Trade Practices Comm., Re) 41 D.L.R. (4th)
Que 1155 (Que. C.A.); leave to appeal re- 429; affirming [1982] 2 F.C. 500, 62 C.P.R.
fused 2008 CarswellQue 9014 (S.C.C.) 1, 132 D.L.R. (3d) 323 (C.A.); which re-
..........................................................CA 36 versed [1982] 1 F.C. 72, 56 C.P.R. (2d) 83
Hately v. Elliott (1905), 9 O.L.R. 185 (C.A.) (F.C.T.D.)................................................CA 11
..........................................................CA 62 Irving and Restrictive Trade Practices Comm., Re,
Henuset Bros. Ltd. v. Syncrude Can. Ltd., see Irvine v. Canada (Restrictive Trade Prac-
[1980] 6 W.W.R. 218, 52 C.P.R. (2d) 173, tices Comm.)
33 A.R. 199, 114 D.L.R. (3d) 300 Irving Paper Ltd. v. Atofina Chemicals Inc.,
..........................................................CA 36 2009 CarswellOnt 8610 (Ont. S.C.J.); leave
Howard Smith Paper Mills Ltd. v. R., [1957] to appeal refused 2010 ONSC 2705, 2010
S.C.R. 403, 29 C.P.R. 6, 26 C.R. 1, 118 CarswellOnt 3898 (Ont. S.C.J.)
C.C.C. 321, 8 D.L.R. (2d) 449 ..........................................................CA 36
..........................................................CA 45 Jabour v. Law Soc. of B.C., [1982] 2 S.C.R.
Hudson’s Bay Co. v. Canada (Director of 307, [1982] 5 W.W.R. 289, 37 B.C.L.R. 145,
Investigation & Research) (1992), 10 O.R. 19 B.L.R. 234, 66 C.P.R. (2d) 1, 137 D.L.R.
(3d) 89, 42 C.P.R. (3d) 448, 58 O.A.C. 7 (3d) 1, 43 N.R. 451
(C.A.); affirming (1992), 9 O.R. (3d) 51, 42 ........................................... CA 2.1, CA 10
C.P.R. (3d) 435 (Gen. Div.); leave to appeal
Jabour v. Law Soc. of B.C., [1982] 2 S.C.R.
to S.C.C. refused (1993), 15 O.R. (3d) xvi
307, [1982] 5 W.W.R. 289, 37 B.C.L.R. 145,
(note), 50 C.P.R. (3d) v (note), 163 N.R. 79
19 B.L.R. 234, 66 C.P.R. (2d) 1, 137 D.L.R.
(note) (S.C.C.) ........................................CA 15
(3d) 1, 43 N.R. 451; affirming [1981] 2
Hughes v. Liquor Control Board of Ontario, W.W.R. 159, 24 B.C.L.R. 1, 53 C.P.R. (2d)
2019 ONCA 305, 2019 CarswellOnt 5818, 87; which reversed [1979] 4 W.W.R. 385, 45
145 O.R. (3d) 401 (Ont. C.A.) C.P.R. (2d) 163, 98 D.L.R. (3d) 442
............................................ CA 36, CA 45 ..........................................................CA 45
Hyprescon Inc. v. IPEX Inc. (2007), 2007 Cars- Jacques c. Pétroles Irving inc., 2014 SCC 66
wellOnt 2046 (Ont. S.C.J.) (S.C.C.) ...................................................CA 29
..........................................................CA 36
Janelle Pharmacy Ltd. v. Blue Cross of Atlantic
Imp. Tobacco Co. and McGregor, Re, [1939]
Canada, 2003 CarswellNS 314, 2003 NSSC
O.R. 627, 72 C.C.C. 321, [1939] 4 D.L.R. 99
179, 217 N.S.R. (2d) 50, 683 A.P.R. 50, 27
(C.A.) ........................................................CA 7
C.P.R. (4th) 19 (N.S. S.C.)
Industrial Milk Producers Assn. v. British ..........................................................CA 36
Columbia (Milk Bd.) (1988), [1989] 1 F.C.
463, 18 F.T.R. 147, 21 C.P.R. (3d) 33, 47 John Guy Annable v. Capital Sports &
D.L.R. (4th) 710 (T.D.) Entertainment Inc., 2008 Comp. Trib. 5
..........................................................CA 36 (Competition Trib.)
.....................................................CA 103.1
Irvine v. Canada (Restrictive Trade Practices
Comm.), [1987] 1 S.C.R. 181, 15 C.P.R. (3d) Kobo Inc. v. The Commissioner of Competition,
289...........................................................CA 14 2014 Comp. Trib. 14; affirmed Rakuten
Kobo Inc. v. Canada (Commissioner of Com-
Irvine v. Canada (Restrictive Trade Practices petition), 2015 CarswellNat 12187 (F.C.A.);
Comm.), [1987] 1 S.C.R. 181, 15 C.P.R. (3d) leave to appeal refused 2016 CarswellNat 51
289, 34 C.C.C. (3d) 481, (sub nom. (S.C.C.) .................................................CA 106
Restrictive Trade Practices Comm. v. Irvine)
74 N.R. 33, (sub nom. Irving and Restrictive La-Z-Boy Canada Ltd. v. Allan Morgan and
Trade Practices Comm., Re) 41 D.L.R. (4th) Sons Ltd. (2004), 35 C.P.R. (4th) 99 (Fed.
429...........................................................CA 12 C.A.)..................................................... CTA 13
Irvine v. Canada (Restrictive Trade Practices Laboratoires Servier v. Apotex Inc. (2008), 67
Comm.), [1987] 1 S.C.R. 181, 15 C.P.R. (3d) C.P.R. (4th) 241, 2008 CarswellNat 3000
289, 34 C.C.C. (3d) 481, (sub nom. (F.C.T.D.); additional reasons at (2008), 2008
Restrictive Trade Practices Comm. v. Irvine) CarswellNat 4195, 70 C.P.R. (4th) 347
74 N.R. 33, (sub nom. Irving and Restrictive (F.C.T.D.); affirmed (2009), 2009 Car-
xxxiv
Table of Cases
swellNat 1922, 75 C.P.R. (4th) 443 (Fed. McManus v. Canada (Atomic Energy Control
C.A.)........................................................CA 36 Board), [1980] 2 F.C. 278, 49 C.P.R. (2d) 1,
35 N.R. 152 (Fed. C.A.)
Lake Ontario Cement v. Canada (Dir. of
..........................................................CA 11
Investigation & Research) (1990), 32 C.P.R.
(3d) 93, 37 F.T.R. 197 (F.C.T.D.) Metropolitan Toronto Apartment Builders Assn.
..........................................................CA 17 v. LIUNA, Local 183, 2014 ONSC 4976
(Ont. Div. Ct.) ........................................CA 29
Law Society of Upper Canada v. Canada
(Attorney General) (1996), 134 D.L.R. (4th) Middlekamp v. Fraser Valley Real Estate Board
300, 28 O.R. (3d) 460, 67 C.P.R. (3d) 48 (1990), 29 C.P.R. (3d) 385 (B.C. Master); af-
(Gen. Div.)..............................................CA 10 firmed (1990), 32 C.P.R. (3d) 206 (B.C.S.C.)
..........................................................CA 29
Lawson Business Forms (Man.) Ltd., Re (1987),
16 C.P.R. (3d) 167 (Sask. Prov. Ct.) Mil Davie Inc. v. Hibernia Management &
...............................CA 18, CA 20, CA 27 Development Co., 1998 CarswellNat 814, 85
C.P.R. (3d) 320 (Fed. C.A.)
Leegin Creative Leather Products, Inc. v. PSKS, ..........................................................CA 36
Inc. (2007), 551 U.S. 877 (U.S. S.C.)
..........................................................CA 76 Minister of National Revenue v. Marshall, 2006
FC 788, 2006 CarswellNat 1706 (F.C.)
Lefebvre v. Knott (1907), 32 Que. S.C. 441, 13 ......................................................... CTA 8
C.C.C. 223 ..............................................CA 45
Molnlycke AB v. Kimberly-Clark of Canada
Lin v. Airbnb, Inc., 2019 FC 1563, 2019 Car- Ltd. (1991), 36 C.P.R. (3d) 493 (Fed. C.A.)
swellNat 10122, 2019 CarswellNat 10123 ............................................ CA 36, CA 45
(F.C.) .......................................................CA 36
Mondor v. Fisherman, see CC&L Dedicated En-
Louis Vuitton Malletier S.A. v. Bags O’Fun Inc. terprise Fund (Trustee of) v. Fisherman
(2003), 242 F.T.R. 75 (F.C. T.D.)
......................................................... CTA 8 Mrs. O’s Pharmacy v. Pfizer Canada Inc.
(2004), 35 C.P.R. (4th) 171 (Competition
Lounsbury Co. v. Bathurst (1948), 22 M.P.R. Trib.) ..................................................CA 103.1
436, [1949] 1 D.L.R. 62 (N.B. C.A.)
..........................................................CA 86 Murphy c. Cie Amway Canada, 2015 FC 958
(F.C.) .......................................................CA 36
MacIntyre v. Nova Scotia (Attorney General)
(1982), 65 C.C.C. (2d) 129 (S.C.C.) N.S. Pharmaceutical Society v. Canada (1988),
..........................................................CA 15 21 C.P.R. (3d) 550 (N.S. T.D.)
..........................................................CA 15
Manos Foods International Inc. v. Coca-Cola
N.S. Pharmaceutical Society v. R. (1988), (sub
Ltd. (1999), 2 C.P.R. (4th) 283, 125 O.A.C.
nom. Pharmaceutical Society (N.S.) v. Can-
66, 180 D.L.R. (4th) 309, 40 C.P.C. (4th)
ada) 88 N.S.R. (2d) 70, 225 A.P.R. 70 (T.D.)
113 (Ont. C.A.)
..........................................................CA 19
............................................ CA 75, CA 77
Nadeau Ferme Avicole Ltée v. Groupe Westco
Maritime Travel Inc. v. Go Travel Direct.Com
Inc., 2009 Comp. Trib. 6, 2009 CarswellNat
Inc. (2008), 66 C.P.R. (4th) 61, 265 N.S.R.
5934 (Competition Trib.)
(2d) 369 (N.S.S.C.); additional reasons at
.....................................................CA 103.1
(2008), 269 N.S.R. (2d) 396 (N.S.S.C.); addi-
tional reasons at 2008 CarswellNS 602 Nadeau Ferme Avicole Ltée v. Groupe Westco
(N.S.S.C.); affirmed 2009 CarswellNS 219 Inc., 2009 Comp. Trib. 6, 2009 CarswellNat
(N.S.C.A.) ................................. CA 36, CA 52 5934 (Competition Trib.); affirmed Nadeau
Ferme Avicole Ltée/Nadeau Poultry Farm
Matoni v. C.B.S. Interactive Multimedia Inc.,
Ltd. v. Groupe Westco Inc., 2011 FCA 188,
2008 CarswellOnt 228 (Ont. S.C.J.); addi-
2011 CarswellNat 2032 (Fed. C.A.)
tional reasons at 2008 CarswellOnt 5077
..........................................................CA 75
(Ont. S.C.J.); additional reasons at 2008
CarswellOnt 5076 (Ont. S.C.J.); additional Nadeau Ferme Avicole Ltée v. Groupe Westco
reasons at 2008 CarswellOnt 7185 (Ont. Inc., 2010 Comp. Trib. 2, 2010 CarswellNat
S.C.J.)......................................................CA 36 2822, 2010 Comp. Trib. 15 (Competition
xxxv
Table of Cases
Trib.); affirmed 2011 CarswellNat 770, 2011 Norvinca Inc., Re, [1987] 3 F.C. 365, 12 F.T.R.
FCA 106 (Fed. C.A.) 1, 16 C.P.R. (3d) 187 (T.D.)
......................................................... CTA 8 ..........................................................CA 17
Nadeau Poultry Farm Limited v. Groupe Westco Novus Entertainment Inc. v. Shaw Cablesystems
Inc., 2012 Comp. Trib. 13 (Competition Ltd., 2010 BCSC 1030, 2010 CarswellBC
Trib.) .....................................................CA 104 1962 (B.C.S.C.)
..........................................................CA 36
Nadeau Poultry Farm Ltd. v. Groupe Westco
Inc., 2008 Comp. Trib. 7, 2008 CarswellNat Olah v. Canada (Correctional Service), 2008
2590 (Competition Trib.) Comp. Trib. 29 (Competition Trib.)
.....................................................CA 103.1 ...................................... CA 2.1, CA 103.1
Nadeau Poultry Farm Ltd. v. Groupe Westco Ontario (Commissioner of Competition) v.
Inc., 2008 Comp. Trib. 16, 2008 CarswellNat Yellow Page Marketing B.V., 2012 ONSC
2591 (Competition Trib.) 927 (Ont. S.C.J.)
........................................................CA 104 .....................................................CA 74.01
National Capital News Canada v. Canada Option Consommateurs c. Minebea Co., 2016
(Speaker of the House of Commons) (2002), QCCS 3698 (C.S. Que.)
[2002] C.C.T.D. No. 38, 23 C.P.R. (4th) 77 ..........................................................CA 36
(Competition Trib.); affirmed (2004), 29 P.P.G. Indust. Can. Ltd. v. A.G. Can. (1982), 40
C.P.R. (4th) 421 (F.C.A.) B.C.L.R. 299, 67 C.P.R. (2d) 192, 3 C.C.C.
.....................................................CA 103.1 (3d) 97 at 99, 3 C.R.R. 171, 146 D.L.R. (3d)
261 at 263 (S.C.); affirmed (1983), 42
New Brunswick (Board of Management) v.
B.C.L.R. 334, 71 C.P.R. (2d) 56, 3 C.C.C.
Dunsmuir, (sub nom. Dunsmuir v. New
(3d) 97, 4 C.R.R. 193, 146 D.L.R. (3d) 261
Brunswick) [2008] 1 S.C.R. 190 (S.C.C.)
(C.A.) ......................................................CA 67
....................................................... CTA 13
Pandolfo Management Services Ltd. v.
North American Van Lines Canada Ltd. v.
Grasslands Feeders Ltd., 1993 CarswellSask
Canada (Director of Investigation & Re-
326, [1993] S.J. No. 189 (Sask. Q.B.)
search) (1997), 136 F.T.R. 16, 78 C.P.R. (3d)
.....................................................CA 74.01
221, 4 Admin. L.R. (3d) 123 (T.D.)
...............................CA 11, CA 12, CA 14 Paramount Indust. Inc. v. R. (1973), 10 C.P.R.
(2d) 216 (Que. C.A.)
North York Branson Hospital v. Praxair Canada ..........................................................CA 34
Inc. (1998), 84 C.P.R. (3d) 12 (Ont. Gen.
Div.); leave to appeal refused (1999), 1999 Peloquin v. Latraverse (1919), 57 Que. S.C.
CarswellOnt 450 (Ont. Div. Ct.) 379, 33 C.C.C. 165, 54 D.L.R. 181
..........................................................CA 36 ..........................................................CA 62
Northern Pool Express Ltd. v. Canada (Dir. of People Recycling Inc. v. Vancouver (City), 2002
Investigation & Research appointed under the BCSC 1395 (B.C. S.C.)
Competition Act) (1988), 39 B.L.R. 166, (sub .........................................................CA 2.1
nom. Northern Pool Express Ltd. v. Dir. of Petrofina Canada Ltd. v. Canada (Restrictive
Investigation & Research) 19 C.P.R. (3d) Trade Practices Commission) (1979), [1980]
308, 26 O.A.C. 378 (C.A.); affirming (1987), 2 F.C. 386, 46 C.P.R. (2d) 1 (F.C.A.)
(sub nom. Cottrell Transport Inc. v. Dir. of ............................................................CA 9
Investigation and Research) 19 C.P.R. (3d)
117 (Ont. H.C.); leave to appeal to S.C.C. Pharmaceutical Society (N.S.) v. Canada, see N.S.
refused (1988), 39 B.L.R. xxxviii (note), 30 Pharmaceutical Society v. R.
O.A.C. 78 (note), 88 N.R. 318 (note) Philco Prod. Ltd. v. Thermionics Ltd., [1943]
(S.C.C.) ...................................................CA 17 S.C.R. 396, 3 Fox Pat. C. 92, 3 C.P.R. 17,
[1943] 3 D.L.R. 499
Northern Pool Express Ltd. v. Dir. of
..........................................................CA 62
Investigation & Research, see Northern Pool
Express Ltd. v. Canada (Dir. of Investigation Philippe Beaubien & Cie Ltée v. Can. Gen.
& Research appointed under the Competition Elec. Co. (1976), 30 C.P.R. (2d) 100 (Que.
Act) S.C.) ........................................................CA 62
xxxvi
Table of Cases
Pilote Ready Mix Inc. v. Rocois Construction BCCA 186, 2011 CarswellBC 930 (B.C.
Inc., see Rocois Construction Inc. v. Que. C.A.); reversing 2010 BCSC 285, 2010 Car-
Ready Mix Inc. swellBC 508 (B.C. S.C.)
Pindoff Record Sales Ltd. v. CBS Music ..........................................................CA 36
Products Inc. (1989), 44 C.P.C. (2d) 308, 27 Pro-Sys Consultants Ltd. v. Microsoft Corp.,
C.P.R. (3d) 380 (Ont. H.C.) 2016 BCSC 97 (B.C. S.C.)
..........................................................CA 36 ..........................................................CA 29
Pioneer Corp. v. Godfrey, 2019 SCC 42, 2019 Procter & Gamble Co. v. Kimberly-Clark of
CarswellBC 2746, 2019 CarswellBC 2747, Can. Ltd. (1986), 21 C.I.P.R. 317, 12 C.P.R.
26 B.C.L.R. (6th) 1, 39 C.P.C. (8th) 229, 437 (3d) 430 (Fed. T.D.)
D.L.R. (4th) 383, [2019] 11 W.W.R. 191, ..........................................................CA 36
[2019] S.C.J. No. 42 (S.C.C.)
..........................................................CA 36 Procter & Gamble Co. v. Kimberly-Clark of
Canada Ltd. (1991), 40 C.P.R. (3d) 1, (sub
Pioneer Corp. v. Godfrey, 2019 SCC 42, 2019
nom. Procter & Gamble Co. v. Kimberly-
CarswellBC 2746, 2019 CarswellBC 2747,
Clark of Canada Ltd. (No. 4)) 49 F.T.R. 31
26 B.C.L.R. (6th) 1, 39 C.P.C. (8th) 229, 437
(T.D.).......................................................CA 79
D.L.R. (4th) 383, [2019] 11 W.W.R. 191,
[2019] S.C.J. No. 42 (S.C.C.); affirming 2017 Procter & Gamble Co. v. Kimberly-Clark of
BCCA 302 (B.C. C.A.); affirming 2016 Canada Ltd. (No. 4), see Procter & Gamble
BCSC 844 (B.C. S.C.) Co. v. Kimberly-Clark of Canada Ltd.
..........................................................CA 36
Proprietary Articles Trade Assn. v. A.G. Can.,
Polaroid Canada Inc. v. Continent-Wide [1931] A.C. 310, [1931] 1 W.W.R. 552, 55
Enterprises Ltd. (1994), 18 B.L.R. (2d) 294, C.C.C. 241, [1931] 2 D.L.R. 1 (P.C.)
59 C.P.R. (3d) 257 (Ont. Gen. Div.) ............................................ CA 31, CA 32
..........................................................CA 77
Purolator Courier Ltd. v. United Parcel Service
Price v. Panasonic Canada Inc., 2000 Carswell- Canada Ltd. (1995), 20 B.L.R. (2d) 270, 60
Ont 2931 (Ont. S.C.J.) C.P.R. (3d) 473 (Ont. Gen. Div.); additional
..........................................................CA 36 reasons at (November 8, 1995), Doc 95-CU-
Pritchard v. Ontario (Human Rights Commis- 81492 (Ont. Gen. Div.)
sion), [2004] 1 S.C.R. 809 (S.C.C.) ..........................................................CA 52
..........................................................CA 19
Quinlan’s of Huntsville Inc. v. Fred Deeley
Pro-Sys Consultants Ltd. v. Infineon Imports Ltd., 2004 Comp. Trib. 20
Technologies AG, 2009 BCCA 503, 2009 .....................................................CA 103.1
CarswellBC 3035 (B.C.C.A.); leave to appeal
refused 2010 CarswellBC 1361, 2010 Car- Quinlan’s of Huntsville Inc. v. Fred Deeley
swellBC 1362 (S.C.C.) Imports Ltd., 2004 Comp. Trib. 28 (Competi-
..........................................................CA 36 tion Trib.)..............................................CA 104
Pro-Sys Consultants Ltd. v. Infineon R. v. A.B.C. Ready-Mix Ltd. (1972), 17 C.P.R.
Technologies AG, 2009 BCCA 503, 2009 (2d) 91 (Ont. H.C.)
CarswellBC 3035 (B.C.C.A.); reversing 2008 ..........................................................CA 45
BCSC 575, 2008 CarswellBC 943 (B.C.S.C.);
R. v. Abitibi Power & Paper Co. (1960), 36
leave to appeal refused 2010 CarswellBC
C.R. 96, 36 C.P.R. 188, 131 C.C.C. 201
1361 (S.C.C.)..........................................CA 36
(Que. Q.B.) .............................................CA 45
Pro-Sys Consultants Ltd. v. Microsoft Corp.,
2010 BCSC 285 (B.C.S.C.); reversed 2011 R. v. All Communications Network of Canada
CarswellBC 930 (B.C.C.A.) Co. (November 26, 2003) (N.S. Prov. Ct.)
..........................................................CA 36 ..........................................................CA 55
Pro-Sys Consultants Ltd. v. Microsoft Corp., R. v. Allied Towers Merchants Ltd. (1969), 60
2013 SCC 57 (S.C.C.) C.P.R. 140 (Ont. Prov. Ct.)
..........................................................CA 36 ..........................................................CA 34
Pro-Sys Consultants Ltd. v. Microsoft Corp., R. v. Aluminum Co. (1976), 29 C.P.R. (2d) 183
2013 SCC 57 (S.C.C.); reversing 2011 (Que. S.C.)..............................................CA 45
xxxvii
Table of Cases
R. v. Ameublements Leger Inc. (1975), 26 R. v. Big Mac Investments Ltd. (1988), 24

C.P.R. (2d) 130 (Que. S.P.) C.P.R. (3d) 39 (Man. Q.B.)
..........................................................CA 34 .....................................................CA 74.01
R. v. Andico Mfg. Ltd. (1983), 4 C.P.R. (3d) R. v. Bogardus, Wilson Ltd. (1982), 2 C.R.R.
476 (Man. Q.B.) 110 (B.C. Prov. Ct.)
..........................................................CA 76 ..........................................................CA 67
R. v. Anthes Business Forms Ltd. (1975), 10 R. v. Boivin, 28 C.C.C. (3d) 129, (sub nom.
O.R. (2d) 153, 20 C.P.R. (2d) 1, 26 C.C.C. Boivin c. R.) [1986] R.L. 674 (Que. C.A.)
(2d) 349; affirmed [1978] 1 S.C.R. 970, 28 .......................................................CA 55.1
C.P.R. (2d) 33n, 32 C.C.C. (2d) 207n, 22
N.R. 541.................................... CA 45, CA 69 R. v. Burrows (1966), 54 C.P.R. 95 (B.C.)
..........................................................CA 45
R. v. Armco Can. Ltd. (1975), 8 O.R. (2d) 573;
varied 13 O.R. (2d) 32 R. v. Campbell, see R. v. Shirose
..........................................................CA 45 R. v. Campbell, [1964] 2 O.R. 487, [1964] 3
R. v. Armco Can. Ltd. (1976), 13 O.R. (2d) 32, C.C.C. 112, 46 D.L.R. (2d) 83; affirmed
24 C.P.R. (2d) 145, 30 C.C.C. (2d) 183, 70 without written reason [1966] 4 C.C.C. 333n
D.L.R. (3d) 287; leave to appeal to S.C.C. (S.C.C.) ...................................................CA 45
refused 13 O.R. (2d) 32n, 30 C.C.C. (2d)
R. v. Can. Cement Lafarge Ltd. (1973), 12
183n (S.C.C.)..........................................CA 45
C.P.R. (2d) 12 (Ont. Prov. Ct.)
R. v. Arrow Petroleums Ltd. (1972), 8 C.P.R. ..........................................................CA 45
(2d) 95 (Ont. Prov. Ct.)
..........................................................CA 34 R. v. Can. Gen. Elec. Co. (1974), 16 C.P.R.
(2d) 186, 17 C.C.C. (2d) 445 (Ont. H.C.)
R. v. Atl. Sugar Refineries Ltd. (1967), 69 ..........................................................CA 45
D.L.R. (2d) 142, [1968] 3 C.C.C. 374 (Que.
C.A.)........................................................CA 34 R. v. Can. Gen. Elec. Co. (1976), 15 O.R. (2d)
360, 29 C.P.R. (2d) 1, 34 C.C.C. (2d) 489,
R. v. B.C. Pro. Pharmacists’ Soc., [1971] 1 75 D.L.R. (3d) 664 (Ont. H.C.)
W.W.R. 705, 64 C.P.R. 129, 3 C.C.C. (2d) ............................................ CA 45, CA 69
29, 17 D.L.R. (3d) 285 (B.C.)
..........................................................CA 45 R. v. Can. Oxygen Ltd. (1975), 24 C.P.R. (2d)
258, 26 C.C.C. (2d) 398, 64 D.L.R. (3d) 151
R. v. Batt (1980), 53 C.P.R. (2d) 152 (B.C.
(Que. C.A.) .............................................CA 34
Prov. Ct.) ...........................................CA 74.01
R. v. Bayda & Associates Surveys Inc. (1997), R. v. Can. Packers Inc. (1988), 91 C.P.R. (3d)
207 A.R. 28, 55 Alta. L.R. (3d) 95, [1998] 4 133 (Alta. Q.B.)
W.W.R. 252, 78 C.P.R. (3d) 203 (Q.B.) ..........................................................CA 45
..........................................................CA 45 R. v. Can. Safeway Ltd., [1974] 1 W.W.R. 210,
R. v. Beam of Canada Inc. (June 27, 1990), 12 C.P.R. (2d) 3, 14 C.C.C. (2d) 14, 41
Doc. No. CA 31/90 (Ont. C.A.) D.L.R. (3d) 254 (Alta. S.C.)
..........................................................CA 60 ..........................................................CA 34
R. v. Benlolo, 2004 CarswellOnt 8781 (Ont. R. v. Can. Safeway Ltd. (1971), 4 C.P.R. (2d)
S.C.J.); varied (2006), 49 C.P.R. (4th) 161, 217 (Sask. Mag. Ct.)
81 O.R. (3d) 440 (Ont. C.A.) ..........................................................CA 34
..........................................................CA 52 R. v. Canada Packers Inc. (1988), 19 C.P.R.
R. v. Bennett Stores Ltd. (1977), 46 C.P.R. (2d) (3d) 133 (Alta. Q.B.)
136 (B.C. Prov. Ct.) ..........................................................CA 69
..........................................................CA 60
R. v. Cdn. Tire Corp. (1986), 14 C.P.R. (3d)
R. v. Beton ..................................................CA 98 372 (Man. Prov. Ct.); appeal from conviction
R. v. Béton Régional Inc. dismissed, appeal on sentence allowed [1987]
........................................................CA 123 C.L.D. 932 (Man. C.A.)
..........................................................CA 52
R. v. Bidwell Food Processors Ltd. (1976), 29
C.P.R. (2d) 266 (Man. Q.B.) R. v. Central Supply Assn., see R. v. Master
..........................................................CA 34 Plumbers etc. Assn.
xxxviii
Table of Cases
R. v. Chambre d’Immeuble du Saguenay-Lac R. v. Cunningham Drug Stores Ltd. (1973), 13

St.-Jean Inc. (1988), 23 C.P.R. (3d) 204 (Fed. C.P.R. (2d) 244, 17 C.C.C. (2d) 279, 47
T.D.)........................................................CA 34 D.L.R. (3d) 47 (B.C. C.A.); affirming (1972),
R. v. Charles Press (February 12, 1999) (Alta. 8 C.P.R. (2d) 127, 12 C.C.C. (2d) 4 (B.C.
Q.B.)........................................................CA 55 Prov. Ct.) ................................................CA 52
R. v. Cheung, 2011 ABQB 225 (Alta. Q.B.) R. v. D.E. Adams Coal Ltd. (1957), 23 W.W.R.
.......................................................CA 52.1 419, 65 Man. R. 358, 27 C.R. 47, 29 C.P.R.
163, 119 C.C.C. 350 (Q.B.)
R. v. Civil Const. Inc. (1964), 47 C.P.R. 208 ............................................ CA 34, CA 45
(Que.) ......................................................CA 45
R. v. Dave Spear Ltd (1986), 11 C.P.R. (3d) 63
R. v. Clarke (1983), 71 C.P.R. (2d) 38, 5 C.C.C.
(Ont. H.C.)..............................................CA 45
(3d) 58, 43 Nfld. & P.E.I.R. 127, 127 A.P.R.
127, 147 D.L.R. (3d) 763 (Nfld. C.A.) R. v. Discount Broadloom Centre Ltd. (1976),
..........................................................CA 52 31 C.P.R. (2d) 110 (Ont. Co. Ct.)
..........................................................CA 52
R. v. CLP Canmarket Lifestyle Products Corp.,
[1987] 5 W.W.R. 687, 50 Man. R. (2d) 113, R. v. Dom. Steel & Coal Corp. (1956), 116
17 C.P.R. (3d) 429 (Q.B.); affirmed [1988] 2 C.C.C. 117 at 135, 27 C.P.R. 57 (Ont. H.C.)
W.W.R. 170, 50 Man. R. (2d) 106, 19 C.P.R. ............................................ CA 34, CA 45
(3d) 342 (C.A.); leave to appeal to S.C.C. R. v. Dowdall, 2013 ONCA 196 (Ont. C.A.)
refused [1988] 6 W.W.R. 1xix (note), 88 ..........................................................CA 47
N.R. 89 (note), 57 Man. R. (2d) 160 (note)
(S.C.C.) ................................................CA 55.1 R. c. Drouin, 2010 CarswellQue 2248 (Que.
C.A.)........................................................CA 45
R. v. CLP Canmarket Lifestyle Products Corp.
(1989), 58 Man. R. (2d) 95 (Q.B.) R. v. Durward (2014)
.......................................................CA 55.1 ..........................................................CA 47
R. v. Coastal Glass & Aluminum (1984), 8 R. v. Durward, 2014 ONSC 4194 (Ont. S.C.J.)
C.P.R. (3d) 46, 17 C.C.C. (3d) 313 (B.C. ..........................................................CA 69
S.C.); affirmed (1986), 11 C.P.R. (3d) 391,
R. v. Dyck, [1984] 6 W.W.R. 425, 35 Sask. R.
27 C.C.C. (3d) 289 (B.C. C.A.)
229 (Prov. Ct.)........................................CA 52
..........................................................CA 47
R. v. Eldorado Nuclear Ltd.
R. v. Consolidated Fastfrate Transport Inc.
.........................................................CA 2.1
(1995), 24 O.R. (3d) 564, 40 C.P.C. (3d)
160, 61 C.P.R. (3d) 339, 99 C.C.C. (3d) 143, R. v. Electrical Contractors’ Assn. (1961),
125 D.L.R. (4th) 1, 83 O.A.C. 1 (C.A.) [1961] O.R. 265, 1961 CarswellOnt 26, 36
..........................................................CA 36 C.R. 1, 27 D.L.R. (2d) 193, 37 C.P.R. 1, 131
R. v. Consumers Distributing Co. (1973), 12 C.C.C. 145 (Ont. C.A.)
C.P.R. (2d) 34 (Ont. Prov. Ct.) ..........................................................CA 45
..........................................................CA 34 R. c. Électromega ltée, 2010 CarswellQue 5468
R. v. Consumers Distributing Co. (1980), 54 (Que. S.C.)..............................................CA 47
C.P.R. (2d) 50, 57 C.C.C (2d) 317 (Ont. R. v. F.W. Woolworth Co. (1974), 3 O.R. (2d)
C.A.)........................................................CA 60 629, 16 C.P.R. (2d) 272, 18 C.C.C. (2d) 23,
R. v. Corning Glass Works of Can. Ltd. (1972), 46 D.L.R. (3d) 345 (C.A.)
9 C.P.R. (2d) 69 (Ont. Co. Ct.) ..........................................................CA 34
..........................................................CA 34 R. v. F.W. Woolworth Co. (1974), 3 O.R. (2d)
R. c. Couche-Tard inc., 2012 CarswellQue 629, 16 C.P.R. (2d) 272, 18 C.C.C. (2d) 23,
10745, [2012] J.Q. No. 8109 (C.S. Que.); af- 46 D.L.R. (3d) 345 (C.A.); reversing (1973),
firmed 2014 CarswellQue 7899, 2014 Car- 21 C.R.N.S. 371, 11 C.P.R. (2d) 229, 11
swellQue 14609 (C.A. Que.) C.C.C. (2d) 572 (H.C.)
..........................................................CA 45 ..........................................................CA 69
R. c. Couche-Tard inc., 2014 QCCA 1456, 2014 R. v. Family Tire Centres Ltd. (1975), 25 C.P.R.
CarswellQue 14609 (C.A. Que.) (2d) 219, 28 C.C.C. (2d) 474 (Ont. C.A.)
..........................................................CA 45 ............................................ CA 34, CA 52
xxxix
Table of Cases
R. c. Fedele, 2018 QCCA 1901 R. v. Independent Order of Foresters, [1989]

..........................................................CA 47 I.L.R. 1-2420, 26 C.P.R. (3d) 229, 32 O.A.C.
R. v. Fitopco Inc. (1988), 22 C.P.R. (3d) 41 278 (C.A.); affirming (1987), 26 C.P.R. (3d)
(Ont. Dist. Ct.)........................................CA 52 56 (Ont. Dist. Ct.)
..........................................................CA 52
R. v. Fuel Base Industries Inc. (1992), 4 Alta.
R. v. Independent Order of Foresters (No. 1)
L.R. (3d) 188, 44 C.P.R. (3d) 184 (Prov. Ct.)
(1986), 13 C.P.R. (3d) 563 (Ont. Dist. Ct.)
..........................................................CA 52
............................................ CA 52, CA 60
R. v. George Lanthier & Fils Ltée (1986), 12 R. v. Independent Order of Foresters (No. 2)
C.P.R. (3d) 282 (Ont. Dist. Ct.); affirmed (1986), 14 C.P.R. (3d) 254 (Ont. Dist. Ct.)
(1988), 24 C.P.R. (3d) 288 (Ont. C.A.) ..........................................................CA 69
..........................................................CA 76
R. c. Industries Garanties ltée, 2014 QCCS 1582
R. v. Giftwares Wholesale Co., see Giftwares (C.S. Que.); affirmed R. c. Al Nashar, 2015
Wholesale Co. v. Rodger CarswellQue 8671 (C.A. Que.)
R. v. Giftwares Wholesale Co. (1987), 19 ..........................................................CA 47
C.P.R. (3d) 75 (Man. Prov. Ct.) R. v. Int. Vacations Ltd. (1980), 33 O.R. (2d)
..........................................................CA 60 327, 56 C.P.R. (2d) 251, 22 C.R. (3d) 382,
R. v. Gignac (1975), 25 C.P.R. (2d) 265, 29 59 C.C.C. (2d) 557, 124 D.L.R. (3d) 319
C.C.C. (2d) 74 (Ont. Prov. Ct.) (C.A.) ......................................................CA 52
..........................................................CA 34 R. v. Integrity Group (Canada) Inc. (1997), 199
R. c. Gosselin, 2013 QCCS 717 (C.S. Que.) A.R. 234, 73 C.P.R. (3d) 525 (Alta. Prov.
..........................................................CA 45 Ct.) ..........................................................CA 67
R. v. Irving Oil Ltd. (1978), 47 C.P.R. (2d) 179
R. c. Gosselin, 2017 QCCA 244, 2017 Carswell-
(N.B. Prov. Ct.)
Que 883 (C.A. Que.); leave to appeal refused
..........................................................CA 52
2017 CarswellQue 6860, 2017 CarswellQue
6861 (S.C.C.)..........................................CA 45 R. v. J. Clark & Son Ltd. (1986), 71 N.B.R.
(2d) 257, 182 A.P.R. 257 (Q.B.); leave to
R. v. Grange, [1978] 5 W.W.R. 39, 40 C.P.R. appeal to N.B. C.A. refused (September 25,
(2d) 214 (B.C. Co. Ct.) 1986), Doc. No. 148/86/CA (N.B. C.A.)
............................................................CA 2 ..........................................................CA 52
R. v. Griffith Saddlery & Leather Ltd. (1986), R. v. John, [1971] S.C.R. 781
14 C.P.R. (3d) 389 (Ont. Prov. Ct.) ..........................................................CA 45
..........................................................CA 76
R. v. Jordan, 2016 SCC 27
R. v. Hemlock Park Co-op. Farm Ltd., [1974] ..........................................................CA 47
S.C.R. 123, 5 C.P.R. (2d) 101, 6 C.C.C. (2d)
R. v. K.B.M. Electropedic Adjustable Beds Ltd.
189, 24 D.L.R. (3d) 688
(1983), 75 C.P.R. (2d) 58, 50 A.R. 76 (Q.B.)
............................................ CA 34, CA 67
..........................................................CA 52
R. v. Hobbs Glass Ltd., [1950] O.W.N. 368, 97 R. v. K-Mart Can. Ltd., [1980] 2 W.W.R. 548,
C.C.C. 156 (H.C.) 52 C.C.C. (2d) 223, 24 A.R. 505 (Q.B.)
..........................................................CA 67 ..........................................................CA 52
R. v. Hovila .................................................CA 66 R. v. K-Mart Can. Ltd. (1978), 50 C.P.R. (2d)
R. v. Hovila (2014), 110 W.C.B. (2d) 47, 2013 271 (N.S. Co. Ct.)
CarswellAlta 2082 (A.B.Q.B.) ..........................................................CA 52
..........................................................CA 66 R. v. Kachuk (1973), 12 C.P.R. (2d) 45 (Alta.
R. v. Hovila (2014), 112 W.C.B. (2d) 611, 2014 Prov. Ct.) ...........................................CA 74.01
CarswellAlta 393 (A.B.Q.B.) R. v. Kanzaki Specialty Papers Inc. (1994), (sub
..........................................................CA 66 nom. Canada v. Kanzaki Specialty Papers
R. v. Howard Smith Paper Mills Ltd., [1954] Inc.) 56 C.P.R. (3d) 467, 82 F.T.R. 63 (T.D.)
O.R. 663, 22 C.P.R. 119, 19 C.R. 242, 109 .........................................................CA 1.1
C.C.C. 213, [1954] 4 D.L.R. 517 (S.C.) R. v. Kenitex Can. Ltd. (1980), 51 C.P.R. (2d)
..........................................................CA 45 103; appeal on acquittal of individual accused
xl
Table of Cases
only allowed (sub nom. R. v. Fell) 34 O.R. R. v. Medi-Man Rehabilitation Products, Inc.
(2d) 665, 59 C.P.R. (2d) 34, 64 C.C.C. (2d) (1998), 81 C.P.R. (3d) 267 (Ont. Gen. Div.)
456, 131 D.L.R. (3d) 105 (C.A.) ..........................................................CA 52
..........................................................CA 52 R. v. Mediacom Indust. Inc. (1985), 3 C.P.R.
R. v. Kito Can. Ltd., [1976] 4 W.W.R. 189, 25 (3d) 47 (Ont. H.C.)
C.P.R. (2d) 145, 30 C.C.C. (2d) 531 (Man. ..........................................................CA 45
C.A.)........................................................CA 34 R. v. Michaud (1978), 40 C.P.R. (2d) 63, 41
R. v. Law Assn. (Waterloo) (1988), 21 C.P.R. C.C.C. (2d) 139 (Ont. Dist. Ct.)
(3d) 528 (Ont. H.C.) ..........................................................CA 52
..........................................................CA 34 R. v. Mitsubishi Corp. (2005), 40 C.P.R. (4th)
R. v. Leipert (1997), 112 C.C.C. (3d) 385 333 (Ont. S.C.J.)
(S.C.C.) ...................................................CA 15 ..........................................................CA 46
R. v. Les Distributeurs Cardinal Ltée (1979), 55 R. v. Multitech Warehouse Direct Inc. (1993),
C.P.R. (2d) 155 (Que. S.P.) 50 C.P.R. (3d) 468, 124 N.S.R. (2d) 378, 345
..........................................................CA 60 A.P.R. 378 (T.D.); affirming (1992), 119
N.S.R. (2d) 52, 330 A.P.R. 52 (Prov. Ct.)
R. v. Lethbridge Concrete Prod. Ltd. (1979), 52 ..........................................................CA 60
C.P.R. (2d) 85, 24 A.R. 335 (T.D.)
............................................ CA 45, CA 69 R. v. Muralex Distributions Inc./Distributions
Muralex Inc. (1987), 15 B.C.L.R. (2d) 151
R. v. Levi Strauss of Can. Inc. (1979), 45 (Co. Ct.); leave to appeal refused (May 10,
C.P.R. (2d) 215 (Ont. Co. Ct.) 1989), Doc. No. CA008106, [1989]
..........................................................CA 34 B.C.W.L.D. 1521, [1989] C.L.D. 830 (B.C.
R. v. Lorne Wilson Tpt. Ltd. C.A.)........................................................CA 52
..........................................................CA 47 R. v. Must de Cartier Canada Inc. (1989), 45
R. v. Lowe Real Estate Ltd. (1978), 40 C.C.C. B.L.R. 167, 27 C.P.R. (3d) 37 (Ont. Dist.
(2d) 529 (Ont. C.A.) Ct.) ..........................................................CA 76
..........................................................CA 52 R. v. Nat. Upholstering Mfg. (1964) Ltd. (1975),
R. v. Lyons Fuel, Hardware & Supplies Ltd., 23 C.P.R. (2d) 23, 27 C.C.C. (2d) 551 (Man.
[1961] O.R. 860, 36 C.R. 156, 131 C.C.C. Co. Ct.) ...................................................CA 52
189, 30 D.L.R. (2d) 6 (S.C.) R. v. Nestlé Canada Inc., 2015 ONSC 810 (Ont.
..........................................................CA 45 S.C.J.)......................................................CA 29
R. v. Master Plumbers etc. Assn. (1907), 14 R. v. North Sailing Products Ltd. (1987), 18
O.L.R. 295, (sub nom. R. v. Central Supply C.P.R. (3d) 497 (Ont. Dist. Ct.)
Assn.) 12 C.C.C. 371 (C.A.) ..........................................................CA 76
..........................................................CA 45
R. v. Nova Motors Ltd. (1982), 51 N.S.R. (2d)
R. v. Maxzone Auto Parts (Canada) Corp., 2012 273, 102 A.P.R. 273 (Co. Ct.)
FC 1117 (Fed. Court) ............................................ CA 52, CA 69
..........................................................CA 46
R. v. Nova Scotia Pharmaceutical Society,
R. v. McGavin Bakeries Ltd., 2 W.W.R. (N.S.) [1992] 2 S.C.R. 606, 43 C.P.R. (3d) 1, 93
1, 12 C.R. 123, 100 C.C.C. 195, [1951] 4 D.L.R. (4th) 36
D.L.R. 806 (Alta. S.C.) ..........................................................CA 11
..........................................................CA 67
R. v. Ocean Const. Supplies Ltd. (1974), 18
R. v. McLellan Supply Ltd. (1985), 64 A.R. 6 C.P.R. (2d) 166, 22 C.C.C. (2d) 340, 61
(Prov. Ct.) ...............................................CA 67 D.L.R. (3d) 323 (B.C. C.A.)
R. v. McLellan Supply Ltd. (1986), 69 A.R. ..........................................................CA 45
132, (sub nom. R. v. 215626 Alta. Ltd.) 12 R. v. Park Realty Ltd. (1978), 2 C.R. (3d) 336
C.P.R. 53 (Q.B.) (Man. Prov. Ct.)
..........................................................CA 47 ..........................................................CA 52
R. v. McMichael (1907), 10 O.W.R. 268, 18 R. v. Pepsi Cola Can. Ltd. (1986), 14 C.P.R.
C.C.C. 186 (H.C.) (3d) 399 (Ont. Prov. Ct.)
..........................................................CA 45 .....................................................CA 74.06
xli
Table of Cases
R. v. Petrofina Can. Ltd. (1974), 20 C.P.R. (2d) R. v. Services Sanitaires de Shawinigan Inc.
83, 21 C.C.C. (2d) 315 (Ont. Dist. Ct.) (April 26, 1996), de Blois J. (Que. S.C.)
..........................................................CA 34 ..........................................................CA 34
R. v. Philips Electronics Ltd. (1980), 30 O.R. R. v. Shaklee Can. Inc., [1985] 1 F.C. 593, 38
(2d) 129, 11 B.L.R. 204, 53 C.P.R. (2d) 74, Alta. L.R. (2d) 289, 4 C.P.R. (3d) 433, 59
55 C.C.C. (2d) 312, 116 D.L.R. (3d) 298; N.R. 147 (C.A.); affirmed (sub nom. Shaklee
affirmed [1981] 2 S.C.R. 264, 59 C.P.R. (2d) Can. Inc. v. Canada (A.G.)) [1988] 1 S.C.R.
212, 62 C.C.C. (2d) 384, 126 D.L.R. (3d) 662, 58 Alta L.R. (2d) 348, 20 C.P.R. (3d)
767...........................................................CA 76 192, 84 N.R. 385 (S.C.C.)
R. v. Pneus Grand Prix Ltée, 1985 CarswellQue ..........................................................CA 34
344 (C.S.P. Qué.) R. v. Shaklee Can. Inc., [1985] 1 F.C. 593, 38
..........................................................CA 52 Alta. L.R. (2d) 289, 4 C.P.R. (3d) 433, 59
N.R. 147 (C.A.); reversing [1981] 2 F.C.
R. v. Postal Promotions Ltd. (1986), 11 C.P.R.
730, 55 C.P.R. (2d) 243 (Fed. T.D.); affirmed
(3d) 215 (Ont. Dis. Ct.); leave to appeal to
(sub nom. Shaklee Can. Inc. v. Canada
Ont. C.A. refused (1987), 16 C.P.R. (3d) 383
(A.G.)) [1988] 1 S.C.R. 662, 20 C.P.R. (3d)
(Ont. C.A.)..............................................CA 52
192........................................................CA 55.1
R. v. R.L. Thorpe Sales Ltd. (1983), 49 A.R.
R. v. Shell Canada Products Ltd. (1989), 24
354 (C.A.)...............................................CA 47
C.P.R. (3d) 501 (Man. Q.B.); leave to appeal
R. v. Rolex Watch Co. of Can. (1980), 50 refused (1990), 45 B.L.R. 231, 75 C.R. (3d)
C.P.R. (2d) 222, 53 C.C.C. (2d) 445 (Ont. 365, 29 C.P.R. (3d) 32, 63 Man. R. (2d) 1
C.A.).......................................... CA 34, CA 69 (C.A.) ......................................................CA 76
R. c. Rousseau, 2018 QCCS 640 R. v. Shirose, 171 D.L.R. (4th) 193, (sub nom.
..........................................................CA 47 R. v. Campbell) [1999] 1 S.C.R. 565 (S.C.C.)
R. v. Royal LePage Real Estate Services Ltd. ..........................................................CA 19
(1993), 12 Alta. L.R. (3d) 282, [1994] 1 R. v. Simpsons Ltd. (1988), 25 C.P.R. (3d) 34
W.W.R. 228, 50 C.P.R. (3d) 161, 105 D.L.R. (Ont. Dist. Ct.)..................... CA 52, CA 74.06
(4th) 556, 143 A.R. 241 (Q.B.)
R. v. Simpsons-Sears Ltd. (1976), 28 C.P.R.
..........................................................CA 76
(2d) 249 (Ont. Co. Ct.)
R. v. S.S. Kresge Co. (1972), 5 C.P.R. (2d) 133 ..........................................................CA 52
(Alta. S.C.)..............................................CA 52
R. v. Skylark Holidays Ltd. (1981), 51 Nfld. &
R. v. S.S. Kresge Co. (1975), 25 C.P.R. (2d) 16, P.E.I.R. 248 (Nfld. Dist. Ct.)
27 C.C.C. (2d) 420, 8 Nfld. & P.E.I.R. 415, ..........................................................CA 52
65 D.L.R. (3d) 628 (P.E.I. C.A.)
R. v. Sony of Canada Ltd. (1987), 16 C.P.R.
..........................................................CA 34
(3d) 50 (Ont. Dist. Ct.)
R. v. Sault Ste. Marie, [1978] 2 S.C.R. 1299, 3 ..........................................................CA 76
C.R. (3d) 30, 40 C.C.C. (2d) 353, 7 C.E.L.R.
R. v. St. Lawrence Corp., [1969] 2 O.R. 305, 7
53, 85 D.L.R. (3d) 161, 21 N.R. 295
C.R.N.S. 265, 59 C.P.R. 97, [1969] 3 C.C.C.
..........................................................CA 60
263, 5 D.L.R. (3d) 263; varying 51 C.P.R.
R. v. Schelew (1984), 78 C.P.R. (2d) 102, 52 170 (C.A.)...............................................CA 45
N.B.R. (2d) 142, 137 A.P.R. 142 (C.A.) R. v. Standard Metal Prod. Ltd. (1973), 15
..........................................................CA 76 C.P.R. (2d) 39 (Sask. Q.B.)
R. v. Scotia Chevrolet Oldsmobile Ltd. (1980), ..........................................................CA 52
62 C.P.R. (2d) 172, 44 N.S.R. (2d) 410, 83 R. v. Steinberg’s Ltd. (1976), 13 O.R. (2d) 293,
A.P.R. 410 (Co. Ct.) 26 C.P.R. (2d) 109, 31 C.C.C. (2d) 30, 70
..........................................................CA 52 D.L.R. (3d) 624 (C.A.)
R. v. Sears Canada Inc. (1989), 28 C.P.R. (3d) ..........................................................CA 52
248 (Ont. Dist. Ct.) R. v. Stucky (2006), 53 C.P.R. (4th) 369 (Ont.
..........................................................CA 52 S.C.J.); reversed on other grounds 2009 Cars-
R. v. Seltzer (1970), 64 C.P.R. 77 (Que. S.P.) wellOnt 745 (Ont. C.A.)
..........................................................CA 34 ..........................................................CA 29
xlii
Table of Cases
R. v. Sunrise Lighting Distributors (Maritime) R. v. Westfair Foods Ltd. (1986), 33 B.L.R.

Ltd. (1992), 48 C.P.R. (3d) 289 (N.S. Prov. 163, 11 C.P.R. (3d) 345, 41 Man. R. (2d)
Ct.) ..........................................................CA 52 205 (Q.B.)...............................................CA 60
R. v. Suntours Ltd. (1974), 20 C.P.R. (2d) 179, R. v. Westfair Foods Ltd. (Supervalu), [1985] 3
21 C.C.C. (2d) 239 (Ont. Prov. Ct.) W.W.R. 423, 5 C.P.R. (3d) 373, 18 C.C.C.
..........................................................CA 60 (3d) 178, 38 Sask R. 12, 16 D.L.R. (4th) 669
(Q.B.) ........................................ CA 52, CA 60
R. v. Sutson Ltd. (1972), 6 C.P.R. (2d) 246
(Ont. Co. Ct.)..........................................CA 52 R. v. Wholesale Travel Group Inc., [1991] 3
S.C.R. 154, 8 C.R. (4th) 145, 38 C.P.R. (3d)
R. v. T. Eaton Co., [1974] 4 W.W.R. 484, 15
451, 67 C.C.C. (3d) 193, 84 D.L.R. (4th)
C.P.R. (2d) 25, 17 C.C.C. (2d) 501, 47
161, 7 C.R.R. (2d) 36, 130 N.R. 1, 49
D.L.R. (3d) 746 (Man. C.A.); affirming 12
O.A.C. 161................................ CA 52, CA 60
C.P.R. (2d) 276, 14 C.C.C. (2d) 124 (Man.
Q.B.)........................................................CA 52 R. v. William E. Coutts Co., [1968] 1 O.R. at
550, 52 C.P.R. 21, [1968] 2 C.C.C. at 222,
R. v. T. Eaton Co. (1971), 4 C.P.R. (2d) 226
67 D.L.R. (2d) at 88; affirmed [1968] 1 O.R.
(Ont. Prov. Ct.)
at 564, 54 C.P.R. 60, [1968] 2 C.C.C. 221,
..........................................................CA 34
67 D.L.R. (2d) 87 (C.A.)
R. v. T. Eaton Co. (1975), 26 C.P.R. (2d) 118 ..........................................................CA 76
(Alta. T.D.) .............................................CA 52
R. v. Wonder Steel Bldg. (Central) Ltd. (1981),
R. v. Tege Invt. Ltd. (1978), 51 C.P.R. (2d) 216 56 C.P.R. (2d) 103, 59 C.C.C. (2d) 372 (Ont.
(Alta. Prov. Ct.) Co. Ct.) ...................................................CA 52
..........................................................CA 60
R. v. Woolworth Canada Inc. (2000), 3 B.L.R.
R. v. The Wholesale Travel Group Inc. (1989), (3d) 174 (Ont. C.J.)
52 C.C.C. (3d) 9 (Ont. C.A.) ............................................ CA 52, CA 60
..........................................................CA 60
R. v. York-Hanover Hotels Ltd. (1986), 9
R. v. Total Ford Sales Ltd. (1987), 18 C.P.R. C.P.R. (3d) 440 (Ont. Prov. Ct.)
(3d) 404 (Ont. Dist. Ct.); varying (July 11, ..........................................................CA 47
1986), Charles Prov. J. (Ont. Prov. Ct.)
R. v. Yukon Auto. Brokers Ltd. (1979), 50
..........................................................CA 52
C.P.R. (2d) 81 (Y.T. S.C.)
R. v. Travelways Sch. Transit Ltd. (1982), 40 ............................................ CA 52, CA 69
O.R. (2d) 86, 67 C.P.R. (2d) 188, 69 C.C.C.
R. v. 215626 Alta. Ltd., see R. v. McLellan Sup-
(2d) 94, 138 D.L.R. (3d) 690; affirming (sub
ply Ltd.
nom. R. v. Charterways Tpt. Ltd.) 32 O.R.
(2d) 719, 60 C.C.C. (2d) 510, 123 D.L.R. R. v. 359286 Ont. Ltd. (1981), 58 C.P.R. (2d)
(3d) 159 (C.A.) 169 (Nfld. Prov. Ct.)
..........................................................CA 47 ..........................................................CA 52
R. v. UCAR Inc. (1999), (sub nom. Canada v. R.L. Crain Inc. v. Couture (1983), 10 C.C.C.
UCAR Inc.) 164 F.T.R. 85 (Fed. T.D.) (3d) 119, 6 D.L.R. (4th) 478, 30 Sask. R.
..........................................................CA 46 191 (Q.B.)....................CA 11, CA 12, CA 69
R. v. Uranium Can. Ltd., [1983] 2 S.C.R. 551, 7 Raimondo v. Canada (Director of Investigation
Admin. L.R. 195, 77 C.P.R. (2d) 1, 8 C.C.C. and Research) (1995), 61 C.P.R. (3d) 142
(3d) 449, 1 O.A.C. 243, 50 N.R. 120, 4 (Ont. Gen. Div.)
D.L.R. (4th) 193 ..........................................................CA 11
.........................................................CA 2.1
Rakuten Kobo Inc. v. Canada (Commissioner of
R. v. WCC Publishing Ltd. (1978), 44 C.P.R. Competition), 2018 FC 64
(2d) 64 (Que. S.P.) ........................................................CA 106
..........................................................CA 52
Ravenshoe Services Ltd. v. Canada
R. v. Westfair Foods Ltd. (1984), 3 C.P.R. (3d) (Commissioner of Competition) (2001), 15
174 (Man. Prov. Ct.) C.P.R. (4th) 543 (Ont. S.C.J.)
..........................................................CA 60 ..........................................................CA 11
xliii
Table of Cases
Rebuck v. Ford Motor Company, 2018 ONSC Rogers Communications Inc. v. Shaw
7405 (Ont. S.C.J.) Communications Inc., 2009 CarswellOnt
..........................................................CA 36 5849 (Ont. S.C.J.)
..........................................................CA 45
Reed v. Ottawa Football Club (1988), 62 Alta.
L.R. (2d) 347 (Alta. Q.B.) RONA Inc. v. Canada (Commissioner of Com-
..........................................................CA 48 petition) (2005), 42 C.P.R. (4th) 53 (Compe-
tition Trib.) ...........................................CA 106
Regatta Investments Ltd. v. Shell Can. Products
Ltd. (1988), 23 C.P.R. (3d) 378 (Man. Q.B.) Rubenstein v. Kumer, [1940] O.W.N. 153, 73
..........................................................CA 36 C.C.C. 303, [1940] 2 D.L.R. 691 (H.C.)
..........................................................CA 62
Regulvar Canada Inc. v. Ontario (2004), 70 O.R.
(3d) 641 (Ont. C.A.) Safa Enterprises Inc. v. Imperial Tobacco Co.,
............................................................CA 2 2013 Comp. Trib. 19
..........................................................CA 76
Restrictive Trade Practices Comm. v. Irvine, see
Irvine v. Canada (Restrictive Trade Practices Samson v. Canada, see Samson v. R.
Comm.) Samson v. R., (sub nom. Samson v. Canada)
Rhodes v. Cie Amway Canada, 2011 FC 1341 [1995] 3 F.C. 306, 64 C.P.R. (3d) 417, 131
(F.C.) .......................................................CA 36 D.L.R. (4th) 360, 102 F.T.R. 239 (note), 181
N.R. 89 (C.A.); leave to appeal to S.C.C. re-
Richard v. Time......................................CA 74.01 fused (1996), 65 C.P.R. (3d) vi (note), (sub
Richard v. Time Inc. nom. Samson v. Canada) 132 D.L.R. (4th) vii
.....................................................CA 74.03 (note) (S.C.C.) ........................................CA 11
Richard v. Time Inc., 2012 SCC 8, [2012] 1 Samuel, Son & Co. v. Canada (Restrictive Trade
S.C.R. 265 (S.C.C.) Practices Comm.) (1987), [1988] 2 F.C. 523,
....................................... CA 52, CA 74.03 21 C.P.R. (3d) 84, 48 D.L.R. (4th) 77
(F.C.T.D.)................................................CA 11
RJR-MacDonald Inc. v. Canada (Attorney Gen-
eral), [1994] 1 S.C.R. 311, 54 C.P.R. (3d) Sandhu v. HSBC Finance Mortgages Inc., 2014
114, (sub nom. RJR-MacDonald Inc. c. BCSC 2041 (B.C. S.C.); reversed 2016 Car-
Canada (Procureur général))) 164 N.R. 1, swellBC 1899 (B.C. C.A.)
(sub nom. RJR-MacDonald Inc. c. Canada ..........................................................CA 52
(Procureur général))) 60 Q.A.C. 241, 111 Sandoff v. Loblaw Companies Ltd., 2015 SKQB
D.L.R. (4th) 385, 1994 CarswellQue 120F, 345 (Sask. Q.B.)
1994 CarswellQue 120 (S.C.C.) ..........................................................CA 52
........................................................CA 104 Sears Canada Inc. v. Parfums Christian Dior
RJR-MacDonald Inc. c. Canada (Procureur gén- Canada Inc., 2007 Comp. Trib. 6, 2007 Car-
éral)), see RJR-MacDonald Inc. v. Canada (At- swellNat 1610 (Competition Trib.)
torney General) .....................................................CA 103.1
Robinson Motorcycle Ltd. v. Fred Deeley Sebastian v. Saskatchewan, see Sebastian v. Sas-
Imports Ltd., 2005 Comp. Trib. 40 katchewan (Dept. of Highways &
.....................................................CA 103.1 Transportation)
Rocois Construction Inc. v. Que. Ready Mix Sebastian v. Saskatchewan (Dept. of Highways
Inc., [1985] 2 F.C. 40, 32 B.L.R. 213, 24 & Transportation) (1987), 61 Sask. R. 71,
C.C.C. (3d) 158, 8 C.P.R. (3d) 145, (sub (sub nom. Sebastian v. Saskatchewan) 31
nom. Pilote Ready Mix Inc. v. Rocois C.R.R. 350 (Q.B.)
Construction Inc.) 25 D.L.R. (4th) 373 .........................................................CA 2.1
(C.A.); affirmed [1989] 1 S.C.R. 695, 48 SGL Canada Inc. v. Canada (Director of
C.C.C. (3d) 501, 25 C.P.R. (3d) 304, 60 Investigation & Research) (1998), 86
D.L.R. (4th) 124 A.C.W.S. (3d) 74 (F.C.T.D.)
..........................................................CA 36 ..........................................................CA 11
Rocois Construction Inc. v. Québec Ready Mix Sierra Club of Canada v. Canada (Minister of
Inc., see Dominion Ready Mix Inc. c. Rocois Finance), 2002 SCC 41, [2002] 2 S.C.R. 522
Construction Inc. (S.C.C.) ...................................................CA 29
xliv
Table of Cases
Smith v. Jones, [1999] 1 S.C.R. 455, 169 D.L.R. C.A.); reversing in part 2010 BCSC 922,
(4th) 385 (S.C.C.) 2010 CarswellBC 1749 (B.C. S.C.)
..........................................................CA 19 ..........................................................CA 36
Society of Composers, Authors & Music Sunbeam Corp. (Can.) Ltd. v. R., [1969] S.C.R.
Publishers of Canada v. Landmark Cinemas 221, 56 C.P.R. 242, [1969] 2 C.C.C. 189, 1
of Canada Ltd. (1992), 45 C.P.R. (3d) 346, D.L.R. (3d) 161
60 F.T.R. 161 (T.D.) ..........................................................CA 69
..........................................................CA 32 Symbol Technologies Canada ULC v. Barcode
Softkey Software Products Inc., Re (1994), 84 Systems Inc. (2005), 43 C.P.R. (4th) 291
F.T.R. 153, (sub nom. Canada (Director of (Competition Trib.)
Investigation & Research) v. Softkey ..........................................CA 106, CTA 8
Software Products Inc.) 57 C.P.R. (3d) 480 Symbol Technologies ULC v. Barcode Systems
(T.D.).................................................... CTR 60 Inc. .....................................................CA 103.1
Solosky v. Canada (1979), [1980] 1 S.C.R. 821, Tank Lining Corp. v. Dunlop Indust. Ltd.
105 D.L.R. (3d) 745 (S.C.C.) (1982), 40 O.R. (2d) 219, 68 C.P.R. (2d)
..........................................................CA 19 162, 140 D.L.R. (3d) 659 (C.A.)
Southam Inc. v. Canada (Director of ..........................................................CA 62
Investigation & Research) (1997), 78 C.P.R. Tas Communications Systems Ltd. v. Nfld. Tel.
(3d) 315 (Competition Trib.) Co. (1981), 22 C.P.C. 97, 59 C.P.R. (2d)
......................................................... CTA 9 144, 33 Nfld. & P.E.I.R. 508, 93 A.P.R. 508
Southam Inc. v. Canada (Director of (Nfld. T.D.)...............................................CA 7
Investigation & Research) (1998), 78 C.P.R. Tele-Mobile Co., A Partnership v. Bell Mobility
(3d) 341 (Competition Trib.) Inc., 46 C.P.R. (4th) 146 (B.C.S.C. [In
........................................................CA 106 Chambers]); additional reasons at 2006 Car-
Stargrove Entertainment Inc. v. Universal Music swellBC 2462 (B.C.S.C. [In Chambers]); ad-
Publishing Group Canada, 2015 Comp. Trib. ditional reasons at 2006 CarswellBC 2482
26...................................... CA 103.1, CTR 119 (B.C.S.C. [In Chambers])
...............................CA 33, CA 36, CA 52
Stearns v. Avery (1915), 33 O.L.R. 251, 24
C.C.C. 339 (H.C.) Tellier v. St. Michel-des-Caints, [1951] Que.
..........................................................CA 62 S.C. 34 ....................................................CA 86
Telus Communications Co. v. Bell Mobility
Steele v. Toyota Canada Inc., 2011 BCCA 98,
Inc., 2007 BCSC 518 (B.C.S.C. [In
2011 CarswellBC 424, 90 C.P.R. (4th) 450
Chambers])..............................................CA 52
(B.C.C.A.); reversing 2008 CarswellBC 1658,
295 D.L.R. (4th) 653, 68 C.P.R. (4th) 27 Telus Communications Co. v. Rogers
(B.C.S.C.)................................................CA 36 Communications Inc., 2009 BCCA 581, 2009
CarswellBC 3424 (B.C.C.A.)
Stelco Inc. v. Canada (Attorney General), [1990]
..........................................................CA 36
1 S.C.R. 617, 36 F.T.R. 80 (note), 55 C.C.C.
(3d) 227, 30 C.P.R. (3d) 1, 108 N.R. 161, 68 Tervita Corp. v. Canada (Commissioner of
D.L.R. (4th) 518 (S.C.C.) Competition), 2015 SCC 3 (S.C.C.)
..........................................................CA 11 ..........................................CA 96, CTA 13
Stevens v. Restrictive Trade Practices Comm., Tervita Corp. v. Canada (Commissioner of
[1979] 2 F.C. 159, 43 C.P.R. (2d) 1, 98 Competition), 2015 SCC 3 (S.C.C.);
D.L.R. (3d) 662 reversing Canada (Commissioner of
.............................................. CA 4, CA 10 Competition) v. CCS Corp., 2013 FCA 28,
2013 CarswellNat 1400, 2013 CarswellNat
Sun-Rype Products Ltd. v. Archer Daniels 6936, (sub nom. Tervita Corp. v. Canada
Midland Co., 2013 SCC 58 (S.C.C.) (Commissioner of Competition)) [2014] 2
..........................................................CA 36 F.C.R. 352, 360 D.L.R. (4th) 717, (sub nom.
Sun-Rype Products Ltd. v. Archer Daniels Tervita Corp. v. Commissioner of Competi-
Midland Co., 2013 SCC 58 (S.C.C.); af- tion) 446 N.R. 261 (F.C.A.); affirming
firming in part and reversing in part 2011 Commissioner of Competition v. CCS Corp.,
BCCA 187, 2011 CarswellBC 931 (B.C. 2012 Comp. Trib. 14, 2012 CarswellNat
xlv
Table of Cases
4409, [2012] C.C.T.D. No. 14 (Competition United States v. Costanzo (2008), 234 C.C.C.
Trib.) .......................................................CA 92 (3d) 108 (B.C.S.C.); affirmed 2009 Car-
swellBC 878 (B.C.C.A.); leave to appeal re-
The Commissioner of Competition v.
fused 2009 CarswellBC 2262, 2009 Car-
HarperCollins Publishers LLC and
swellBC 2263 (S.C.C.)
HarperCollins Canada Limited, 2017 Comp.
.......................................................CA 52.1
Trib. 10 (Competition Trib.)
......................................................... CTA 8 United States v. Edwards, 2009 CarswellBC
3756 (B.C.S.C.)
The Commissioner of Competition v. Hudson’s .......................................................CA 52.1
Bay Company, 2017 Comp Trib 19
.......................................................CA 74.1 United States v. Yemec (2003), 67 O.R. (3d)
394 (Ont. S.C.J.); affirmed 2005 CarswellOnt
The Commissioner of Competition v. Vancouver 1164 (Ont. Div. Ct.); additional reasons at
Airport Authority, 2019 Comp. Trib. 6 (Com- 2005 CarswellOnt 3274 (Ont. Div. Ct.)
petition Trib.)............................ CA 45, CA 79 .......................................................CA 52.1
Thomson Newspapers Ltd. v. Canada (Director United States Pipe & Founding Co., Re (1994),
of Investigation & Research), [1990] 1 S.C.R. 58 C.P.R. (3d) 463 (Ont. Gen. Div.)
425, 54 C.C.C. (3d) 417, 29 C.P.R. (3d) 97, ............................................ CA 15, CA 16
67 D.L.R. (4th) 161 (S.C.C.)
Used Car Dealers Assn. of Ontario v. Insurance
..........................................................CA 11
Bureau of Canada, 2011 Trib. conc. 10
TNT Canada Inc. v. Canada (Director of .....................................................CA 103.1
Investigation & Research), [1995] 2 F.C. 544, Used Car Dealers Association of Ontario v.
60 C.P.R. (3d) 303, 93 F.T.R. 81 (F.C.T.D.) Insurance Bureau of Canada
..........................................................CA 11 ..........................................................CA 75
Toronto Star Newspapers Ltd. v. Ontario, 2003 Used Car Dealers Association of Ontario v.
CarswellOnt 3986 (Ont. C.A.); leave to ap- Insurance Bureau of Canada, 2012 Comp.
peal allowed 2004 CarswellOnt 1762 Trib. 1 (Competition Trib.)
(S.C.C.); affirmed 2005 CarswellOnt 2613, ........................................CA 104, CTA 11
2005 CarswellOnt 2614 (S.C.C.)
..........................................................CA 15 Valley Salvage Ltd. v. Molson Brewery B.C.
Ltd., [1976] 1 W.W.R. 597, 64 D.L.R. (3d)
Tpt. Oil Co. v. Imp. Oil Co., [1935] O.R. 215, 734, 25 C.P.R. (2d) 37 (B.C. S.C.)
63 C.C.C. 108, [1935] 2 D.L.R. 500 (C.A.) ..........................................................CA 62
..........................................................CA 62
Vidéotron, s.e.n.c. c. Bell Canada, 2015 QCCS
Transpacific Tours Ltd. (CP Air Holidays) v. 1663 (C.S. Que.)
Dir. of Investigation and Research (1986), 8 ....................................... CA 52, CA 74.03
C.P.R. (3d) 325, 24 C.C.C. (3d) 103, 25 VitaPharm Canada Ltd. v. F. Hoffmann-La
D.L.R. (4th) 202 (S.C.) Roche Ltd., 2002 CarswellOnt 235, [2002]
............................................ CA 11, CA 12 O.T.C. 57, 20 C.P.C. (5th) 351 (Ont. S.C.J.)
Tremblay c. Acier Leroux inc., 2003 Carswell- ............................................ CA 36, CA 45
Que 1876, [2003] J.Q. No. 9385 (C.S. Que.); VitaPharm Canada Ltd. v. F. Hoffmann-La
affirmed 2004 CarswellQue 449 (C.A. Que.); Roche Ltd., 2002 CarswellOnt 235, [2002]
affirmed 2004 CarswellQue 450 (C.A. Que.); O.T.C. 57, 20 C.P.C. (5th) 351 (Ont. S.C.J.);
affirmed 2004 CarswellQue 461 (C.A. Que.) leave to appeal quashed (2002), 2002 Cars-
......................................................... CTA 8 wellOnt 1797, 23 C.P.C. (5th) 230 (Ont.
United Grain Growers Ltd. v. Canada C.A.)........................................................CA 36
(Commissioner of Competition) (2005), 43 Wampole & Co. v. F.E. Karn Co. (1906), 11
C.P.R. (4th) 343 (Competition Trib.) O.L.R. 619 ..............................................CA 62
..........................................CA 106, CTA 8
Warner Music Group Inc., Re (1997), 138
United Grain Growers Ltd. v. Canada F.T.R. 140, (sub nom. Canada (Director of
(Commissioner of Competition), 2006 Comp. Investigation & Research) v. Warner Music
Trib. 25 (Competition Trib.) Group Inc.) 78 C.P.R. (3d) 335 (T.D.)
......................................................... CTA 9 ............................................ CA 10, CA 11
xlvi
Table of Cases
Warner Music Group Inc., Re (1997), 141 Ziegler v. Canada (Director of Investigation &
F.T.R. 26, (sub nom. Canada (Director of Research) (1983), 75 C.P.R. (2d) 163, 39
Investigation & Research) v. Warner Music C.P.C. 203 (F.C.T.D.); affirmed (1983), 75
Group Ltd.) 78 C.P.R. (3d) 125 (T.D.) C.P.R. (2d) 246 (F.C.T.D.)
..........................................................CA 11 ..........................................................CA 10
Washington v. Canada (Director of Investigation Ziegler v. Hunter (1983), 81 C.P.R. (2d) 1, 8
& Research) (1998), 78 C.P.R. (3d) 479 D.L.R. (4th) 648; leave to appeal to S.C.C.
(Competition Trib.) refused 81 C.P.R. (2d) 1, 8 D.L.R. (4th) 648n
..........................................CA 106, CTA 9 (S.C.C.) ...................................................CA 11
Waterloo Law Assn. v. Canada (A.G.) (1986),
321665 Alberta Ltd. v. ExxonMobil Canada
58 O.R. (2d) 275, 31 C.C.C. (3d) 564, 14
Ltd., 2012 ABQB 76 (Alta. Q.B.)
C.P.R. (3d) 413, 35 D.L.R. (4th) 751 (H.C.)
..........................................................CA 36
..........................................................CA 45
Weidman v. Shragge (1912), 46 S.C.R. 1, 2 351694 Ontario Ltd. v. Paccar of Canada Ltd.
W.W.R. 330, 20 C.C.C. 117, 2 D.L.R. 734 (2004), 35 C.P.R. (4th) 257 (F.C.T.D.)
..........................................................CA 62 ..........................................................CA 36
West Van Cab Ltd. v. British Columbia, 2009 603022 Ont. Inc. v. Canada (Dir. of
CarswellBC 312 (B.C.C.A.); affirming 2007 Investigation & Research, Competition Act)
CarswellBC 1521 (B.C.S.C.) (1988), 21 C.P.R. (3d) 575 (Ont. H.C.)
.........................................................CA 2.1 ..........................................................CA 15
Westfair Foods Ltd. v. Lippens Inc., [1987] 6 1146845 Ontario Inc. v. Pillar to Post Inc., 2014
W.W.R 629, 49 Man. R. (2d) 220, 44 D.L.R. ONSC 7400 (Ont. S.C.J.); additional reasons
(4th) 145 (Q.B.); affirmed (1989), [1990] 2 2015 CarswellOnt 2305 (Ont. S.C.J.)
W.W.R. 42, 30 C.P.R. (3d) 209, 61 Man. R. ..........................................................CA 36
(2d) 282, 64 D.L.R. (4th) 335 (C.A.); leave
to appeal refused (1990), 106 N.R. 16 (note), 2038724 Ontario Ltd. v. Quizno’s Canada
65 Man. R. (2d) 80 (note), 30 C.P.R. (3d) Restaurant Corp., 2009 CarswellOnt 2533, 96
209 (note) (S.C.C.) O.R. (3d) 252 (Ont. Div. Ct.); reversing 2008
..........................................................CA 36 CarswellOnt 1156, 89 O.R. (3d) 252 (Ont.
S.C.J.); additional reasons at 2009 Carswell-
Wong v. Sony of Canada Ltd., 2001 Carswell- Ont 4328 (Ont. Div. Ct.); affirmed 2010
Ont 1546, 9 C.P.C. (5th) 122 (Ont. S.C.J.) ONCA 466, 2010 CarswellOnt 4305 (Ont.
..........................................................CA 36 C.A.); additional reasons at 2010 Carswell-
Yashin v. National Hockey League (2000), 192 Ont 6924 (Ont. C.A.); leave to appeal refused
D.L.R. (4th) 747 (Ont. S.C.J.) 2011 CarswellOnt 499, [2010] S.C.C.A. No.
.............................................. CA 4, CA 48 348 (S.C.C.)............................................CA 36
xlvii
INTRODUCTION: AN OVERVIEW OF THE
COMPETITION ACT
The Competition Act (the “Act”) is a federal statute of general application the purpose of
which is to maintain and encourage competition in Canada for the purpose of promoting the
efficiency and adaptability of the Canadian economy; expanding opportunities for Canadian
participation in world markets; ensuring that small and medium-sized enterprises have an
equitable opportunity to participate in the economy; and providing consumers with competi-
tive prices and product choices.1
Broadly divided into criminal matters and civil reviewable matters, the Act can be concep-
tually divided into four major topic areas:
• Agreements between Competitors — The Act has a dual-track regime for dealing
with agreements between competitors. Section 45 establishes a per se criminal offence
for “hard-core” cartel-like agreements between competitors. Section 90.1 establishes a
civil provision that enables agreements between competitors that do not fall within the
scope of section 45 to be challenged by the Commissioner.2
• Unilateral Conduct — Reviewable practices, under the Competition Act are prohibi-
tions on certain business activities that may be subject to an order by the Tribunal.
These activities include abuse of dominance (section 79) and restraints imposed by
suppliers on customers, such as refusals to deal (section 75), price maintenance (section
76), and tied selling and exclusive dealing (section 77).
• Mergers — All mergers in Canada may be reviewed by the Commissioner to deter-
mine whether they may result in a substantial lessening or prevention of competition.
Mergers than exceed the financial thresholds set out in sections 109 and 110 of the Act
must be notified to the Commissioner prior to completion.
• Deceptive Marketing Practices — The Act also contains consumer protection provi-
sions relating to deceptive marketing practices. Egregious forms of misleading adver-
tising (section 52), deceptive telemarketing (section 52.1), multi-level marketing (sec-
tion 55) and pyramid selling (section 55.1) are criminal offences. Less serious forms of
deceptive marketing, such misleading advertising, misrepresentations about a product’s
performance or efficacy and “bait and switch” selling, may be subject to an order under
the civil provisions in section 74.1.
The Act creates a statutory cause of action (section 36) which permits private parties to
claim damages for losses caused by a breach of the criminal provisions of the Act. Private
enforcement of the non-criminal provisions is generally not possible, except with respect to
refusals to deal (section 75), price maintenance (section 76), and tied selling and exclusive
1 Competition Act, section 1.1. Competition Tribunal jurisprudence states that economic efficiency is the
principal purpose of the merger provisions of the Act.
2 Other types of agreements regulated under the criminal provisions of the Competition Act include bid-
rigging (section 47), agreements relating to professional sport (section 48) and agreements between fed-
eral financial institutions (section 49).
xlix
Introduction: An Overview of the Competition Act
dealing (section 77). Private parties which believe that there has been a breach of one of
these provisions of the Act may directly seek a remedial order from the Tribunal.
The Act is administered and enforced by the Commissioner of Competition (the “Commis-
sioner”), who is head of the Competition Bureau (the “Bureau”), an independent law en-
forcement agency. Based in Gatineau, Quebec and with branch offices across the country,
the Bureau investigates potential contraventions of the Act. Part II of the Act creates the
office of the Commissioner and establishes his investigative and administrative authority.
Section 10 sets out the circumstances in which the Commissioner will commence a formal
inquiry. Sections 11 and 15 set of the Commissioner’s powers to seek document production
and other subpoenas and search warrants. Importantly, investigations are to be conducted in
private and section 29 imposes upon the Commissioner an obligation to treat certain infor-
mation as confidential.
In respect of criminal matters, such as conspiracy (section 45), bid-rigging (section 47) or
egregious forms of misleading advertising (section 52), the Commissioner may refer a matter
to the Attorney General of Canada for prosecution. Criminal matters are then dealt with in
ordinary criminal courts.
In respect of civil reviewable matters, such as abuses of dominance (section 79), agreements
or arrangements between competitors (section 90.1) and mergers (section 92), the Commis-
sioner may, following an investigation, lodge an application with the Competition Tribunal
(“Tribunal”) for a remedial order. The Tribunal, based in Ottawa, is specialized court com-
bining expertise in economics and business with legal expertise. It has exclusive jurisdiction
to hear and dispose of all applications made under Part VII.1 (Deceptive Marketing Prac-
tices), Part VIII (Reviewable Matters) and Part IX (Mergers) of the Act. The Tribunal is
comprised of up to six judicial members appointed from among the judges of the Federal
Court of Canada and up to eight lay members.
Agreements between Competitors
Criminal Offences
The Conspiracy Offence — Section 45
Section 45 is sometimes considered to be the cornerstone of the Competition Act. It is de-
signed to deal with “hardcore” cartels, that is, agreements or arrangements between actual or
potential competitors to fix prices, allocate markets or restrict output.
Section 45 creates a per se offence, which means that proof of the agreement or arrangement
is sufficient to establish the offence — there is no requirement that the agreement or arrange-
ment actually have an anti-competitive effect or actually harm competition in the market.
The anti-competitive effect and the corresponding absence of pro-competitive benefits aris-
ing from the prohibited conduct is presumed under section 45.
The offence under section 45 is the agreement or arrangement itself. Therefore, the offence
occurs at the time of the agreement or arrangement between the parties; it does not require
that the agreement or arrangement actually be implemented. In addition, the agreement or
arrangement does not have to be enforceable in order to qualify as an agreement or arrange-
ment for the purposes of section 45. As a result of the varying geographic scope, levels of
formality and secrecy associated with conspiracies, section 45(3) of the Act expressly pro-
vides that the court may infer the existence of a conspiracy, agreement or arrangement from
circumstantial evidence, even in the absence of any evidence of direct communications be-
tween the parties to the alleged conspiracy, agreement or arrangement.
l
There are a limited range of statutory defences and exceptions to section 45. Subsection
45(4) of the Act creates the ancillary restraints defence, which removes from criminal sanc-
tion certain types of restraints that are necessary to facilitate desirable business transactions
that could otherwise be hampered by the operation of section 45. Paragraph 45(6)(a) of the
Act provides that an agreement or arrangement that is entered into only by affiliates does not
constitute an agreement or arrangement for the purposes of section 45. The definition of
affiliates is set out in section 2 of the Act. Affiliated corporations are defined as corporations
that are controlled by the same person, parents and corporations that are both affiliates of
another company. Similar rules apply to partnerships, sole proprietorships, trusts and other
unincorporated organizations capable of conducting business.
Section 45(7) of the Act codifies the common law regulated conduct defence. It provides a
defendant with a defence to the conspiracy offence set out in section 45 on the basis that the
agreement or arrangement in question was authorized by a legislative scheme or carried out
pursuant to a government approval.
Both corporations and their employees can be charged under section 45. Section 45(2) pro-
vides that everyone who is found guilty of an offence under section 45 is subject, on convic-
tion, to a fine of up to $25 million and a prison term of up to 14 years. In addition, the
participants may be subject to court orders that prohibit them from continuing or repeating
the offence. The failure to abide by such a court order could expose the person to further
criminal or civil penalties. In addition to the serious criminal penalties, persons who have
suffered loss or damage as a result of the conspiracy can sue the cartel participants to recover
the amount of their loss or damage. Due to the widespread impact of the conspiracy and the
amounts at issue, many such lawsuits are brought by way of a class action.
International Conspiracies — Implementing Foreign Directives — Section 46

Section 46 of the Act makes it an offence for a corporation that carries on business in Canada
to implement a directive or other instruction pursuant to a foreign agreement or arrangement
that, if entered into Canada, would constitute a breach of section 45. The provision is de-
signed to facilitate the prosecution of the Canadian affiliates and subsidiaries of foreign cor-
porations that are involved in conspiracies that impact Canadian markets. The Canadian cor-
poration may be found guilty under section 46 even though none of its directors or officers
had any knowledge of the foreign agreement or arrangement. The penalty under section 46 is
a fine in the discretion of the court.
Bid Rigging — Section 47

Section 47 of the Act deals with bid rigging. Bid rigging is a particular type of conspiracy
that occurs when potential bidders agree to fix their bids in response to a call for bids, and do
not disclose their agreement to the person calling for the bids. Potential bidders may fix their
bids by either arriving at their respective bid amounts by agreement or by agreeing that one
or more of them will not submit a bid. Also a per se offence, the anti-competitive effect of
bid rigging is presumed and, therefore, there is no requirement to determine and assess the
competitive effect of the agreement in order to be sanctioned. The penalty for bid rigging is a
fine in the discretion of the court and/or a prison term of up to 14 years.
Industry-Specific Offences — Sections 48 and 49

There are two sections in the Act that are designed to deal with specific industry situations.
Section 48 of the Act relates to conspiracies in professional sports. It is designed to deal with
agreements or arrangements that limit the ability of players to play for a team of the person’s
li
choice. Section 49 of the Act relates to with conspiracies among federal financial institutions
regarding the kind of services to be provided or the group of persons to be served. Although
it creates a number of per se offences, in order to ensure that the legitimate operation of the
financial system is not unnecessarily impaired, section 49 also includes a number of statutory
exceptions
Immunity and Leniency

The Commissioner and the Department of Justice have implemented immunity and leniency
programmes pursuant to which persons that have violated the criminal provisions of the Act
may seek immunity from prosecution or lenient treatment in exchange for co-operating with
the Commissioner’s investigation.
Immunity is a guarantee from the Public Prosecution Service of Canada (the “PPSC”) that it
will not prosecute a person for a particular offence under the Act. The decision to grant
immunity ultimately rests with the PPSC, not the Commissioner. However, the PPSC will
only make a decision on granting immunity after receiving all of the relevant information
from the Commissioner and after receiving a recommendation from the Commissioner. The
PPSC will then exercise its independent discretion and determine whether to grant the party
immunity from prosecution. In almost all cases the PPSC accepts the recommendation of the
Commissioner in respect of grants of immunity.
In order to be eligible for immunity:
• the applicant must terminate any participation in the illegal activity;
• the applicant must not have coerced others to be party to the illegal activity;
• throughout the course of the Commissioner’s investigation and subsequent prosecu-
tions, the applicant must provide complete, timely and ongoing cooperation, including
full, complete, frank and truthful disclosure of all non-privileged information, evidence
and records in its possession;
• the applicant may not disclose its application for a marker and subsequent immunity to
third parties without the Commissioner’s consent;
• the applicant must reveal to the Commissioner any and all conduct of which it is aware,
or becomes aware, that may constitute an offence under the Act and in which it may
have been involved;
• the applicant must take all lawful measures to obtain the cooperation of current or for-
mer directors, officers, employees and agents; and
• the applicant must facilitate the ability of current and former directors, officers, em-
ployees and agents to appear for interviews and provide testimony in related court pro-
ceedings, as requested.
To initiate the immunity process, a party must request an immunity marker from the Senior
Deputy Competition of Competition, Criminal Matters. A marker can be requested on the
basis of limited hypothetical disclosure that identifies only the relevant part and the nature of
the criminal offence. The identity of an immunity applicant does not need to be disclosed
when making an inquiry into the availability of an immunity marker.
If an immunity marker is available, the applicant will need to provide a proffer to the Com-
missioner containing a detailed description of the illegal activity. In the proffer process, the
Commissioner will need to know with sufficient detail and certainty the nature of any
records the applicant can provide, and what evidence or testimony a potential witness can
give. The Commissioner may request an interview with one or more witnesses, or an oppor-
tunity to view certain documents, prior to recommending immunity. The Commissioner will
lii
also likely insist that the immunity applicant provide waivers necessary to allow the Com-
missioner to communicate with other investigating agencies.
A person granted immunity from prosecution by the PPSC remains subject to civil lawsuits
and damages claims with respect to their activities.
Only the first person to come forward and meet the necessary criteria will be eligible for a
grant of immunity. However, subsequent parties or those who did not meet all the necessary
criteria to quality for immunity may quality for leniency (i.e. a lesser fine and/or reduced
prison term) in return for co-operating with the Commissioner’s investigation.
Reviewable Practices — Section 90.1

Not all agreement between competitors are treated as criminal offences under the Act. Sec-
tion 90.1 permits the Commissioner to challenge agreements or arrangements between com-
petitors or potential competitors that result in a substantial lessening or prevention of compe-
tition. The substantive test for the review of such agreements or arrangements is the same as
that found in the merger provisions of the Act. Unlike the criminal provisions relating to
agreements between competitors, which provide for fines, imprisonment and civil damage
actions, a contravention of section 90.1 may only be addressed though a remedial order from
the Tribunal. Fines, imprisonment and private enforcement are not possible.
Unilateral Conduct
The Act contains a number of non-criminal provisions that permit the Tribunal to issue re-
medial orders and Administrative Monetary Penalties for conduct carried out unilaterally
that has an deleterious effect on competition.
Abuse of Dominance
Section 79 of the Act prohibits a person or group of persons that have a dominant position in
a market from engaging in certain conduct that is intended to eliminate or discipline a com-
petitor or deter entry or expansion by competitors in that market or a downstream market in
which that person (or group of persons) has a plausible competitive interest. The Competi-
tion Act is not concerned with dominance or market power itself. Rather, a person or persons
that exploit their dominance or market power in order to maintain or enhance their position
in a market may be found to be abusing their dominant position if such acts produces anti-
competitive effects in that or a related market.
Subsection 79(1) sets out the following elements that must be established before the Tribunal
may grant an order:
a) one or more persons substantially or completely control, throughout Canada or any
area thereof, a class or species of business;
b) that person or those persons have engaged or are engaging in a practice of anti-
competitive acts; and
c) the practice has had, is having or is likely to have the effect of preventing or lessen-
ing competition substantially in a market.
Establishing Dominance
Paragraph 79(1)(a) requires the Commissioner to establish that one or more persons “sub-
stantially or completely control” “throughout Canada or an area thereof” a “class or species
liii
of business”. The Bureau in its Abuse of Dominance Enforcement Guidelines states that it
considers:
• “class or species of business” to be synonymous with the relevant product market;
• “throughout Canada or any area thereof” to be synonymous with the relevant geo-
graphic market; and
• “substantially or completely control” to be synonymous with market power.
In the Bureau’s view, a high market share is a necessary, but not sufficient, condition to
establish market power. The Bureau’s general approach is that a market share of less than
50% will generally not result in an investigation.
Practice of Anti-Competitive Acts

Section 78 sets out a non-exhaustive list of anti-competitive acts, which as noted, must be
part of a “practice” and not one-off events. These include buying up a competitor’s custom-
ers or suppliers; using “fighting brands” (discount brands); and predatory pricing. Practices
that are not included in section 78 have also been considered anti-competitive acts by the
Tribunal. Examples include commencing litigation or threatened litigation against competi-
tors in order to drive or attempt to drive them out of business by raising their costs,3 or using
long-term contracts to prevent customers from changing suppliers.4
In order for an act to be considered anti-competitive, it must be carried out for the purpose of
an intended predatory, exclusionary or disciplinary negative effect. The anti-competitive in-
tent or purpose of an act can be established either by direct evidence (if available) or by
inference based on the reasonably foreseeable consequences of the conduct or the relevant
circumstances. In certain cases, proof of a valid business justification for the conduct can
provide an alternative explanation as to why the alleged anti-competitive act was performed.
Substantial Prevention or Lessening of Competition

Determining whether an anti-competitive act has had, is having, or is likely to have the effect
of preventing or lessening competition substantially in a market requires a comparative as-
sessment of the market with and without the practice of anti-competitive acts. If the market
would have been substantially more competitive in the absence of the anti-competitive prac-
tice (e.g., an effective competitor would have likely emerged, a group of competitors would
have remained in the market), the practice in question will have resulted in a substantial
lessening of competition.
Remedies
Where the Tribunal finds that a practice of anti-competitive acts has prevented or lessened
competition substantially in a market, it may make an order prohibiting the dominant firm or
group of dominant firms from engaging in the practice. It may also make any remedial order
that is reasonable and necessary (including ordering a divestiture of assets or shares) to re-
store competition, and may order the dominant firm or group of dominant firms to pay an
administrative monetary penalty of up to $10 million (for first-time offenders).
3 Canada (Director of Investigation and Research) v. Laidlaw Waste Systems Ltd. (1992), 40 C.P.R.
(3d) 289 (Competition Trib.).
4 Canada (Director of Investigation and Research) v. The D & B Companies of Canada Ltd. (1995), 64
C.P.R. (3d) 216 (Competition Trib.).
liv
Other Reviewable Practices

The Competition Act prohibits a variety of other business practices where they have a signifi-
cant, negative impact on competition. These practices include certain types of distribution
arrangements such as refusal to deal, price maintenance, exclusive dealing, tied selling and
market restriction. All of these practices are subject to a competitive-effects test, with refusal
to deal and price maintenance cases subject to an “adverse effects” test, and exclusive deal-
ing, tied selling and market restriction cases subject to a “substantial lessening of competi-
tion” test.
Where the Tribunal finds that a person has engaged in one of these practices (other than
refusal to deal), it may make an order prohibiting the person from engaging in the practice
or, in the case of price maintenance, may require that person to accept the another person as
a customer within a specified time on usual trade terms. In addition, in the case of exclusive
dealing, tied selling and market restrictions, the Tribunal may make any other order that it
deems necessary to restore competition in the market. In the case of refusal to deal and price
maintenance, the Tribunal may also order that a person be accepted as a customer on usual
trade terms.
Merger Review
The Competition Act confers broad powers on the Commissioner to investigate whether a
proposed or completed merger or acquisition is likely to prevent or lessen competition sub-
stantially. If a transaction raises these concerns, the Commissioner may apply to the Tribunal
for a remedial order.
Whether or not a merger is notifiable, it can be reviewed by the Commissioner under the
substantive merger provisions of the Competition Act both prior to closing (assuming the
transaction comes to the Commissioner’s attention) and for a period of up to one year fol-
lowing its substantial completion.
Thresholds for Review

The Competition Act requires that the Commissioner be given prior notice of merger transac-
tions that exceed specified size thresholds. Notification for share acquisitions is required if
all of the following thresholds have been exceeded:
• Size of the parties: The parties to the transaction, together with their affiliates, must
have assets in Canada, or annual gross revenues from sales in, from or into Canada,
that exceed $400 million;
• Size of the transaction: The target corporation (or its subsidiaries) must have assets in
Canada, or annual gross revenues from sales in or from Canada, that exceed $96 mil-
lion;5 and
• Voting threshold: As a result of the transaction, the purchaser will hold more than 20%,
in the case of a public corporation, or 35%, in the case of a private corporation (or, in
both cases, if the purchaser already holds 20% or 35%, more than 50%) of the votes
attached to all outstanding voting shares of the corporation.
Similar thresholds apply to asset acquisitions, corporate amalgamations, non-corporate busi-
ness combinations and acquisitions of interests in non-corporate business combinations.
5 Subject to an annual increase tied to the increase in Canadian GDP.
lv
Where a proposed transaction is notifiable, the parties may either file a pre-merger notifica-
tion for submit an application for an advance ruling certificate (“ARC”).
Pre-Merger Notification
Section 114 of the Act and the Notifiable Transaction Regulations require that each of the
parties to the transaction to provide general information about the proposed transaction (e.g.,
a description of the transaction and the business objectives intended to be achieved; a copy
of each legal document that is to be used to implement the transaction; and a list of the
foreign competition or antitrust authorities that have been notified of the transaction). In
addition, each party must provide specific information about itself and its significant affili-
ates, including a description of its principal businesses and principal categories of products; a
list of its top 20 customers and suppliers with contact information; information about the
geographic regions of sales for its principal businesses; and copies of all studies, surveys,
analyses and reports that were prepared or received by a senior officer for the purposes of
evaluating or analyzing the transaction.
Pursuant to subsection 116(1) of the Competition Act, in respect of information that is not
known or reasonably obtainable or cannot be supplied because of privilege or because of a
confidentiality requirement, a party may inform the Commissioner under oath or solemn
affirmation of the matters in respect of which information has not been supplied any why the
information has not been supplied. Pursuant to subsection 116(2), a party may also choose
not to provide information that is not considered to be relevant to the Commissioner’s as-
sessment of the proposed transaction by informing the Commissioner under oath or solemn
affirmation of the matters in respect of which information has not been supplied and why the
information was not supplied.
Advance Ruling Certificates

An alternative to making a pre-merger notification filing is to apply to the Commissioner for
an ARC that, if issued, both eliminates the requirement to make a pre-merger notification
filing and prevents the Commissioner from subsequently challenging the transaction. How-
ever, the issuance of an ARC is discretionary and ARCs typically will be issued only where
a transaction does not raise any significant competition law issues.
Waiting Period
Unless an exemption is available, the parties to a notifiable transaction are required to pro-
vide the Commissioner with notice of the proposed transaction and to await the expiration of
a statutory (no close) waiting period before the transaction may be completed. The waiting
period is 30 days unless, prior to expiry of the waiting period, the Commissioner issues a
supplementary information request (“SIR”), which extends the waiting period until 30 days
after the parties have provided the Commissioner with the required information.
In addition, the Commissioner has the ability to apply to the Tribunal under section 100 of
the Act for an order to delay the completion of a merger transaction beyond the statutory
waiting period upon certifying to the Tribunal that an inquiry in respect of the merger is
underway and that, in the absence of an order, a party to the merger would be likely to take
action that would substantially impair the Tribunal’s ability to remedy the effect of the
merger on competition. These orders are discretionary, however, and rarely issued by the
Tribunal.
lvi
Service Standards
In accordance with its published Service Standards, the Competition Bureau classifies
merger transactions as either non-complex or complex. Once the complexity of a proposed
merger has been determined, the Commissioner and his staff undertake to complete their
review of non-complex transactions within 14 days. In the case of complex transactions, the
Commissioner and she staff will determine what additional information will be requested
from the parties by way of a SIR and will work diligently to complete their assessment of the
potential competitive impact of the transaction.
Review Outcomes
Upon the completion of his review, if the Commissioner concludes that he has insufficient
grounds to apply for a remedial order, he may issue an ARC or, as is most commonly the
case, a “no-action” letter to advise the parties that he does not at that time intend to make an
application to the Tribunal for an order pursuant to the merger provisions of the Competition
Act. Where a no-action letter is issued, the Commissioner retains the right to challenge a
merger transaction for up to one year after its completion.
If the Commissioner concludes that a transaction may substantially prevent or lessen compe-
tition, he may challenge the merger by applying to the Tribunal pursuant to section 92 for an
order directing the parties not to proceed with the merger in whole or in part. Section 104
permits the Commissioner to seek an interim order pending the Tribunal’s consideration of
the application.
Deceptive Marketing Practices

The deceptive marketing practices provisions of the Competition Act prohibit persons from
making deceptive representations for the purpose of promoting a business interest. The pro-
hibition is designed to encourage businesses to provide sufficient and accurate information to
consumers so they can make informed choices.
Investigating and enforcing deceptive marketing practices is a priority for the Competition
Bureau. A majority of the deceptive marketing cases in recent years have been resolved by
registered consent agreements under section 105 between the Commissioner and the party in
question.
Criminal Offences
The types of conduct regulated under the criminal provisions of the Act include misleading
advertising (section 52), deceptive telemarketing (section 52.1), deceptive notice of winning
a prize (section 53), double ticketing (section 54), multi-level marketing (section 55) and
pyramid selling (section 55.1).
Misleading Advertising
The Competition Act has a dual-track regime for misleading advertising. The two tracks are
mutually exclusive and once charges have been laid or an application has been filed with the
Tribunal, the Commissioner may not switch regimes.
The criminal prohibition against misleading advertising has been reserved for only the most
egregious types of misleading advertising, where the following criteria are both satisfied:
• there must be clear and compelling evidence that the false or misleading representation
was made knowingly or recklessly (e.g., the accused continues to make these represen-
tations after receiving complaints directly from consumers); and
lvii
• the Commissioner must be satisfied that criminal prosecution would be in public inter-
est (e.g., vulnerable groups were unfairly taken advantage of, the accused has engaged
in similar conduct in the past, civil remedies cannot adequately deal with the substan-
tial harm caused to consumers or competitors).
Corporations that permit representations to be made may also be subject to criminal sanction
under the Competition Act. Representations that are made by Canadians outside of Canada or
in a place where the public may not have access (e.g., an office) are also subject to criminal
sanction under the Competition Act.
There is no requirement to prove that anyone was actually deceived or mislead. Whether a
representation is “misleading in a material respect” depends on the degree to which it could
influence a customer’s buying decision. The literal meaning conveyed by a representation, as
well as its general impression, is taken into account in determining whether or not a repre-
sentation is false or misleading in a material respect.
The maximum penalty for the offence is a jail term of up to 14 years or a fine in the discre-
tion of the court, or both.
Reviewable Practices
Less serious forms of deceptive marketing are reviewable practices subject to civil review
and sanction under section 74.1 of the Competition Act. They include:
• less serious misleading advertising;
• representations in the form of statements, warranties or guarantees that are not based on
adequate and proper tests;
• misleading ordinary price claims;
• “bait and switch” selling;
• selling a product above its advertised price; and
• representations in the form of warranties, guarantees or promises to replace, maintain
or repair a product, which are materially misleading or there is no reasonable prospect
that they will be carried out.
Where the Tribunal is satisfied that a person has engaged in any one of these practices, it
may order the person: to cease the conduct; to publish a notice to make consumers who are
likely to have been affected by the conduct aware of it; or to pay an administrative monetary
penalty of up to $10 million (for first-time corporate offenders). In the case of misleading
advertising, the Tribunal may also make an order for restitution, requiring the person to pay
up to the total amount received from product sales generated as a result of the false or mis-
leading representation and distributing the total amount among the persons to whom the
products were sold. However, wholesalers, retailers or distributors who have resold or dis-
tributed the products are not entitled to restitution.
Promotional Contests
Promotional contests in Canada are primarily regulated under the lottery and gaming provi-
sions of the Criminal Code but the deceptive marketing practices provisions of the Competi-
tion Act are also relevant.6 To avoid criminal or civil liability, any person organizing a pro-
6 Contests open to Quebec residents are also subject to Quebec-specific legislation.
lviii
motional contest in Canada must ensure that the contest’s structure and rules are lawful
according to the provisions set out to both of these statutes.
The Criminal Code regulates lotteries and games of chance and skill. In the context of a
promotional contest, a company must not conduct a contest that is based solely on chance
(e.g., without including a skill-testing question) or requires consideration to be paid by par-
ticipants to the contest promoter.
Under the Competition Act, the contest rules must disclose: the number and approximate
value of the prizes; whether the prizes will be allocated by region; and anything that may
affect a participant’s chance of winning. The Competition Act also requires that winners be
selected or prizes distributed on the basis of skill or on a random basis and, once winners
have been selected, the prizes should be distributed as quickly as possible.
If a court concludes that a person has engaged in conduct contrary to the promotional contest
provisions under the Competition Act, it may order the person not to engage in such conduct,
to publish a corrective notice and/or to pay an administrative monetary penalty of up to C$10
million (for first-time corporate offenders).
lix
COMPETITION ACT
Act
An Act to provide for the general regulation of trade
and commerce in respect of conspiracies, trade prac-
tices and mergers affecting competition
R.S.C. 1985, c. C-34, as am. R.S.C. 1985, c. 27 (1st Supp.), ss. 187 (Sched.
V, item 2), 189; R.S.C. 1985, c. 19 (2nd Supp.), ss. 18–28(2), (3) (Fr.), 29,
30(1), (2) (Fr.), (3)–(6), 31, 32(1) (Fr.), (2), 33, 34, 35 (Fr.), 36–45; R.S.C.
1985, c. 34 (3rd Supp.), s. 8; R.S.C. 1985, c. 1 (4th Supp.), s. 11; R.S.C.
1985, c. 10 (4th Supp.), s. 18; S.C. 1990, c. 37, ss. 29–32; 1991, c. 45, ss.
547–550; 1991, c. 46, ss. 590–594; 1991, c. 47, ss. 714–717; 1992, c. 1, ss.
44–46, 145 (Sched. VIII, item 4) (Fr.); 1992, c. 14; 1993, c. 34, ss. 50, 51;
1995, c. 1, s. 62(1)(d); 1999, c. 2, ss. 1–25(1), (2) (Fr.), 26–37; 1999, c. 28,
s. 153; 1999, c. 31, ss. 44 (Fr.), 45, 46–53 (Fr.), 229; 2000, c. 15, ss.
11–15; 2001, c. 9, ss. 578–580; 2002, c. 7, s. 276; 2002, c. 8, ss. 126–129,
183(1)(f), 198(a)–(c)(iii); 2002, c. 16, ss. 1–3, 4 (Fr.), 5–15; 2003, c. 22, ss.
224(z.18), 225(r); 2007, c. 19, ss. 61, 62; 2009, c. 2, ss. 407–423, 424(1)
(Fr.), (2)–(5), 425–439; 2010, c. 23, ss. 70–81; 2012, c. 24, s. 79; 2014, c.
20, ss. 366(1), 389; 2014, c. 31, ss. 28–35 [s. 28(2) amended 2014, c. 31, s.
46(4).] [ss. 30, 31, 34(2), (3) repealed 2014, c. 31, s. 46(7), (10), (17),
(20).]; 2015, c. 3, ss. 38–41; 2017, c. 6, ss. 123–125; 2017, c. 26, ss. 12,
13; 2018, c. 8, ss. 109–124; 2018, c. 10, ss. 83–88, 97(2); 2019, c. 25, s.
387; 2020, c. 1, s. 22.
SHORT TITLE
1. Short Title — This Act may be cited as the Competition Act.
R.S.C. 1985, c. 19 (2nd Supp.), s. 19
PART I — PURPOSE AND INTERPRETATION (SS. 1.1–6)

Purpose
1.1 Purpose of Act — The purpose of this Act is to maintain and encourage
competition in Canada in order to promote the efficiency and adaptability of
the Canadian economy, in order to expand opportunities for Canadian partici-
pation in world markets while at the same time recognizing the role of foreign
competition in Canada, in order to ensure that small and medium-sized enter-
prises have an equitable opportunity to participate in the Canadian economy
1
S. 1.1 Competition Act
and in order to provide consumers with competitive prices and product

choices.
R.S.C. 1985, c. 19 (2nd Supp.), s. 19
Commentary
Section 1.1 establishes that the Competition Act is to maintain and encourage competition in
order to achieve four somewhat irreconcilable objectives: (1) to promote the efficiency and
adaptability of the Canadian economy; (2) to expand opportunities for Canadian participa-
tion in world markets while at the same time recognizing the role of foreign competition in
Canada; (3) to ensure that small and medium-sized enterprises have an equitable opportunity
to participate in the Canadian economy; and (4) to provide consumers with competitive
prices and product choices.
This provision was thoroughly considered by the Competition Tribunal and Federal Court of
Appeal in Canada (Commissioner of Competition) v. Superior Propane. The Court of Ap-
peal addressed the apparent conflict in section 1.1 by describing it as a “typical statutory
purpose clause” and that “[a]s is not uncommon in such clauses, not all of the stated pur-
poses or objectives can be served at the same time, nor are all necessarily consistent.” In
addition to pointing out that one or more of the objectives may not be applicable in a particu-
lar case, the Court of Appeal noted that “of course, the wording of a particular provision in a
statute may be so clear and precise that it must be regarded as overriding an ambiguous
purpose clause.” According to the Court of Appeal, “a purpose clause serves as a guide to
the court or tribunal in its interpretation of other statutory provisions, and may establish the
parameters within which it must interpret the provisions of the statute.” (See Canada
(Commissioner of Competition) v. Superior Propane (2001), 11 C.P.R. (4th) 289 (F.C.A.) at
315.)
Case Law
Canada (Commissioner of Competition) v. Superior Propane Inc., 11 C.P.R. (4th) 289, 2001
FCA 104, 199 D.L.R. (4th) 130, 269 N.R. 109, [2001] 3 F.C. 185, 2001 CarswellNat 702,
2001 CarswellNat 2092 (Fed. C.A.); leave to appeal refused 2001 CarswellNat 1905, 2001
CarswellNat 1906 (S.C.C.) — In determining whether the efficiency defence contained in s.
96 should be invoked to save a merger that substantially lessened competition, the word
“effects” in s. 96 should be interpreted to include all anti-competitive effects, having regard
to all of the statutory purposes set out in s. 1.1 of the Act.
R. v. Kanzaki Specialty Papers Inc. (1994), (sub nom. Canada v. Kanzaki Specialty Papers
Inc.) 56 C.P.R. (3d) 467, 82 F.T.R. 63 (T.D.) — The purpose of the Act is, among other
things, to maintain and encourage competition and provide consumers with competitive
prices and product choices. When those objectives are thwarted by persons acting in a man-
ner contrary to the criminal provisions of the Act, the punishment must recognize the public
interest in competition.
Alex Couture Inc. v. Canada (Attorney-General) (1991), 83 D.L.R. (4th) 577, 38 C.P.R. (3d)
293 (C.A.); leave to appeal to S.C.C. refused (1992), 91 D.L.R. (4th) vii (note), 42 C.P.R.
(3d) v (note), 141 N.R. 396 (note) (S.C.C.) — The Competition Act as a whole does not
contravene the division of powers established by the Constitution Act, 1867, and is a valid
exercise by Parliament of its trade and commerce power under s. 91(2) of the latter Act.
2
Part I — Purpose and Interpretation (ss. 1.1–6) S. 2(1) Min
Interpretation
2. (1) Definitions — In this Act,
“article” means real and personal property of every description including
Act
(a) money
(b) deeds and instruments relating to or evidencing the title or right to
property or an interest, immediate, contingent or otherwise, in a corpora-
tion or in any assets of a corporation,
(c) deeds and instruments giving a right to recover or receive property,
(d) tickets or like evidence of right to be in attendance at a particular
place at a particular time or times or of a right to transportation, and
(e) energy, however generated;
“business” includes the business of
(a) manufacturing, producing, transporting, acquiring, supplying, storing
and otherwise dealing in articles, and
(b) acquiring, supplying and otherwise dealing in services.
It also includes the raising of funds for charitable or other non-profit
purposes.
“Commission” [Repealed R.S.C. 1985, c. 19 (2nd Supp.), s. 20(2).]
“Commissioner” means the Commissioner of Competition appointed under
subsection 7(1);
“computer system” has the same meaning as in subsection 342.1(2) of the
Criminal Code;
“data” means representations, including signs, signals or symbols, that are ca-
pable of being understood by an individual or processed by a computer system
or other device;
“Director” [Repealed 1999, c. 2, s. 1(1).]
“electronic message” means a message sent by any means of telecommunica-
tion, including a text, sound, voice or image message;
“entity” means a corporation or a partnership, sole proprietorship, trust or
other unincorporated organization capable of conducting business;
“information” includes data;
“locator” means a name or information used to identify a source of data on a
computer system, and includes a URL;
“merger” [Repealed R.S.C. 1985, c. 19 (2nd Supp.), s. 20(2).]
“Minister” means the Minister of Industry;
3
S. 2(1) mon Competition Act
“monopoly” [Repealed R.S.C. 1985, c. 19 (2nd Supp.), s. 20(2).]

“product” includes an article and a service;
“record” means a medium on which information is registered or marked;
“sender information” means the part of an electronic message — including the
data relating to source, routing, addressing or signalling — that identifies or
purports to identify the sender or the origin of the message;
“service” means a service of any description whether industrial, trade, profes-
sional or otherwise;
“subject matter information” means the part of an electronic message that
purports to summarize the contents of the message or to give an indication of
them;
“supply” means,
(a) in relation to an article, sell, rent, lease or otherwise dispose of an arti-
cle or an interest therein or a right thereto, or offer so to dispose of an
article or interest therein or a right thereto, and
(b) in relation to a service, sell, rent or otherwise provide a service or
offer so to provide a service;
“trade, industry or profession” includes any class, division or branch of a
trade, industry or profession;
“Tribunal” means the Competition Tribunal established by subsection 3(1) of
the Competition Tribunal Act.
(2) Affiliation — For the purposes of this Act,
(a) one entity is affiliated with another entity if one of them is the subsidi-
ary of the other or both are subsidiaries of the same entity or each of
them is controlled by the same entity or individual;
(b) if two entities are affiliated with the same entity at the same time, they
are deemed to be affiliated with each other; and
(c) an individual is affiliated with an entity if the individual controls the
entity.
(3) Subsidiary entity — For the purposes of this Act, an entity is a subsidi-
ary of another entity if it is controlled by that other entity.
(4) Control — For the purposes of this Act,
(a) a corporation is controlled by an entity or an individual other than
Her Majesty if
(i) securities of the corporation to which are attached more than 50%
of the votes that may be cast to elect directors of the corporation are
held, directly or indirectly, whether through one or more subsidiaries
4
Part I — Purpose and Interpretation (ss. 1.1–6) S. 2
or otherwise, otherwise than by way of security only, by or for the

benefit of that entity or individual, and
(ii) the votes attached to those securities are sufficient, if exercised, to
elect a majority of the directors of the corporation;
(b) a corporation is controlled by Her Majesty in right of Canada or a
Act
province if
(i) the corporation is controlled by Her Majesty in the manner de-
scribed in paragraph (a), or
(ii) in the case of a corporation without share capital, a majority of
the directors of the corporation, other than ex officio directors, are
appointed by
(A) the Governor in Council or the Lieutenant Governor in
Council of the province, as the case may be, or
(B) a Minister of the government of Canada or the province, as
the case may be; and
(c) an entity other than a corporation is controlled by an entity or indivi-
dual if the entity or individual, directly or indirectly, whether through one
or more subsidiaries or otherwise, holds an interest in the entity that is
not a corporation that entitles them to receive more than 50% of the prof-
its of that entity or more than 50% of its assets on dissolution.
R.S.C. 1985, c. 19 (2nd Supp.), s. 20; 1995, c. 1, s. 62; 1999, c. 2, s. 1; 2010, c. 23, s.
70; 2014, c. 31, s. 28 [Amended 2014, c. 31, s. 46(4).]; 2018, c. 8, s. 109
Commentary
Subsection 2(1)
The definition of “business” is broad and includes “non-profit” activities. This is different
from the approach taken in other statues, such as the Investment Canada Act, which contains
a “generating revenue and carried on in anticipation of profit” requirement. See also the
Competition Bureau’s Interpretation Guideline Number 1 — Definition of “Operating Busi-
ness” (section 108 of the Act).
The definition of “entity” includes corporations, partnerships, sole proprietorships, trusts or
other unincorporated organizations capable of conducting a business.
Subsection 2(2)–(4)
Two entities (including corporations, partnerships, trusts) are affiliated with one another if
one is the subsidiary of the other or both are subsidiaries of the same entity, or each of them
is controlled by the same entity or individual.
Paragraph 2(4)(a) provides that a corporation is controlled by a person if sufficient voting
securities are held “by or for the benefit of that person” [emphasis added]. This language
permits either a registered holder or a beneficial owner to establish control, although the
circumstances in which a registered holder would control a corporation on the basis of its
registered holdings would be rare. See: Regulvar Canada Inc. v. Ontario (2004), 70 O.R.
(3d) 641 (Ont. C.A.) and Duha Printers (Western) Ltd. v. R., [1998] 1 S.C.R. 795.
5
S. 2 Competition Act
See also subs. 108(2), which limits the circumstances in which Crown corporations will be
considered affiliates for the purposes of pre-merger notification in Part IX of the Act.
For guidance on the extent to which shareholder agreements impact affiliate determinations
see the Competition Bureau’s Interpretation Guideline Number 9 — Shareholder
Agreements.
Case Law
R. v. Grange, [1978] 5 W.W.R. 39, 40 C.P.R. (2d) 214 (B.C. Co. Ct.) — Section 2 does not
give a comprehensive definition of the word “product”. Accordingly, the word must be given
its ordinary meaning, as extended by s. 2 — “that which is produced by any action, operation
or work”.
Albany Felt Co. of Can. v. R. (1982), 70 C.P.R. (2d) 36, 2 C.C.C. (3d) 129, 143 D.L.R. (3d)
691; leave to appeal to S.C.C. refused 2 C.C.C. (3d) 129n, 143 D.L.R. (3d) 691n (S.C.C.).
(See also entries under s. 32(1)(c).) — The words “a document” [now “record”] used in s. 45
[now s. 2] do not denote only a single or particular piece of paper, but include also several
individual documents taken as a whole. Each separate piece of paper need not record by
itself something “as having been done, said or agreed upon” so long as some of the docu-
ments seized, when read together, show that something was “done, said or agreed upon”.
2.1 Binding on agents of Her Majesty in certain cases — This Act is

binding on and applies to an agent of Her Majesty in right of Canada or a
province that is a corporation, in respect of commercial activities engaged in
by the corporation in competition, whether actual or potential, with other per-
sons to the extent that it would apply if the agent were not an agent of Her
Majesty.
R.S.C. 1985, c. 19 (2nd Supp.), s. 21
Commentary
This section was added to the Act in the 1986 amendments as a result of the judgment of the
Supreme Court of Canada in R. v. Eldorado Nuclear Ltd.; R. v. Uranium Can. Ltd., [1983] 2
S.C.R. 551, 7 Admin. L.R. 195, 77 C.P.R. (2d) 1, 8 C.C.C. (3d) 449, 1 O.A.C. 243, 50 N.R.
120, 4 D.L.R. (4th) 193. There the court held, relying on s. 16 of the Interpretation Act,
R.S.C. 1970, c. I-23, that the Combines Investigation Act was not binding on the Crown. The
new section does not change that particular holding.
The court further stated, however, that this Crown immunity from prosecution for violation
of a statutory provision extended to an agent of the Crown acting “within the scope of the
public purposes it is statutorily empowered to pursue”. In the actual case, both Uranium
Canada and Eldorado were, by statute, expressly made agents of the Crown. The court found
after an analysis of various federal statutes that the alleged entering into of a conspiracy to
restrict competition by the two Crown corporations was within the scope of Crown purposes.
Section 2.1 seemingly changes the effect of Eldorado Nuclear by making it clear that the
Competition Act is binding on corporate agents of the Crown “in respect of commercial ac-
tivities” engaged in by such agents in competition with other persons.
It should be noted that Eldorado Nuclear is still quite relevant in determining whether the
Competition Act extends to non-corporate Crown agents, that is, individuals. In such cases
two issues arise: whether the individual is indeed a Crown agent and whether such agent
committed acts “designed to effect Crown purposes”.
6
Part I — Purpose and Interpretation (ss. 1.1–6) S. 2.1
The wording of this amendment was changed between second and third readings by adding
the words “to the extent that it would apply if the agent were not an agent of Her Majesty”.
According to the Minutes of Proceedings and Evidence of the Legislative Committee on Bill
C-91, 10:26, the change was made to clarify and ensure that agent Crown corporations will
lose only their immunity based on their agency status but not that based on the “regulated
conduct” exemption, an exemption which applies to all persons in respect of activities au-
Act
thorized by federal or provincial law. For a discussion of the regulated conduct defence, see
the Commentary to s. 45(7).
Case Law
Babstock v. Atlantic Lottery Corp. Inc./Societé de Loteries de l’Atlantique, 2014 Car-
swellNfld 281, [2014] N.J. No. 288 (N.L. T.D.) — It is impossible to make a blanket deter-
mination that because a defendant is an agent of the Crown, it is not subject to the Competi-
tion Act. The key question is whether the defendant engages in commercial activities in
competition with others. An agent of the Crown with statutory monopoly over certain activi-
ties may be subject to the Competition Act because having a monopoly over certain activities
and being in competition with others may not be mutually exclusive concepts (e.g., the de-
fendant, a corporation that conducted lotteries and other gambling activities on behalf of the
Crown, still competed with offshore websites).
West Van Cab Ltd. v. British Columbia, 2009 CarswellBC 312 (B.C.C.A.); affirming 2007
CarswellBC 1521 (B.C.S.C.) — The petitioner brought an application for, among other
things, a declaration that certain amendments to the Motor Carrier Act (British Columbia)
were invalid on the basis that they contravened s. 45 of the Competition Act. The amend-
ments at issue required an operator of a shared ride transportation service to obtain a provin-
cial licence even if its operation was confined to a single municipality, previously a valid
exemption to the licence requirement. The petitioner failed to obtain a licence and his busi-
ness was shut down. The court of appeal upheld the trial judge’s decision to dismiss the
petition. Relying on the conclusion reached in Canada (Attorney General) v. Law Society
(British Columbia), [1982] 2 S.C.R. 307 (S.C.C.), the trial judge concluded that petitioner’s
argument could not succeed because the Competition Act, being federal legislation, does not
apply to either the provincial legislature of British Columbia or the Motor Carrier Commis-
sion. On appeal, the court noted that, pursuant to section 2.1 of the Competition Act, the
Competition Act is only binding on the Crown in limited circumstances.
Olah v. Canada (Correctional Service), 2008 Comp. Trib. 29 (Competition Trib.) — The
applicant applied pursuant to subs. 103.1(1) for leave to make an application under s. 77
against Her Majesty the Queen as represented by the Correctional Service of Canada and
Home Hardware. The applicant alleged that the inmate purchasing service, which required
inmates to purchase merchandise exclusively from Home Hardware, violated s. 77 of the
Act. The application was dismissed. The Tribunal held that the Competition Act did not ap-
ply because neither Her Majesty the Queen nor the Correctional Service of Canada were
corporations involved in commercial activities and that this case involved a policy decision
about a particular service. — See also entry under s. 103.1.
People Recycling Inc. v. Vancouver (City), 2002 BCSC 1395 (B.C. S.C.) — The City of
Vancouver was not engaged in commercial activity in occupying the recycling field on a cost
recovery basis for valid social policy reasons in accordance with authorizing legislation.
Therefore, the city was not competing in business with the plaintiff in any way that would
bring the Competition Act into play.
7
Sebastian v. Saskatchewan (Dept. of Highways & Transportation) (1987), 61 Sask. R. 71,

(sub nom. Sebastian v. Saskatchewan) 31 C.R.R. 350 (Q.B.) — The Act applies to an agent
of the Crown but not to the Crown itself.
3. Defects of form — No proceedings under this Act shall be deemed inva-

lid by reason of any defect of form or any technical irregularity.
[Heading repealed 1992, c. 1, s. 45.]
4. (1) Collective bargaining activities — Nothing in this Act applies in

respect of
(a) combinations or activities of workmen or employees for their own rea-
sonable protection as such workmen or employees;
(b) contracts, agreements or arrangements between or among fishermen
or associations of fishermen and persons or associations of persons en-
gaged in the buying or processing of fish relating to the prices, remunera-
tion or other like conditions under which fish will be caught and supplied
to those persons by fishermen; or
(c) contracts, agreements or arrangements between or among two or
more employers in a trade, industry or profession, whether effected di-
rectly between or among the employers or through the instrumentality of
a corporation or association of which the employers are members, per-
taining to collective bargaining with their employees in respect of salary
or wages and terms or conditions of employment.
(2) Limitation — Nothing in this section exempts from the application of any
provision of this Act a contract, agreement or arrangement entered into by an
employer to withhold any product from any person, or to refrain from acquir-
ing from any person any product other than the services of workmen or
employees.
Commentary
This provision effectively insulates agreements reached through collective bargaining from
the Act’s conspiracy provisions (e.g., ss. 45 and 48).
Case Law
Yashin v. National Hockey League (2000), 192 D.L.R. (4th) 747 (Ont. S.C.J.) — The appli-
cant, a professional hockey player, filed an application for judicial review of an arbitrator’s
decision requiring him to fulfill his contract in order to gain a particular status under the
National Hockey League’s collective bargaining agreement. The application was dismissed.
The judge held that the arbitrator’s decision did not violate s. 48(1). Section 4(1) specifically
exempts collective bargaining activities and, furthermore, the judge noted that collective bar-
gaining agreements entered into by trade unions do not constitute an illegal restraint of trade.
Couture v. Hewison, [1983] 2 W.W.R. 267, 41 B.C.L.R. 233, 71 C.P.R. (2d) 189, 3 C.C.C.
(3d) 52, 145 D.L.R. (3d) 55 (C.A.) — Fishermen are workmen within the meaning of s.
8
Part I — Purpose and Interpretation (ss. 1.1–6) S. 6
4(1)(a) and accordingly may not be compelled to testify under s. 17(1) [see now s. 11] at an
inquiry under the Act concerning activities covered by s. 4(1)(a).
Stevens v. Restrictive Trade Practices Comm., [1979] 2 F.C. 159, 43 C.P.R. (2d) 1, 98
D.L.R. (3d) 662. (See also entries under ss. 7, 8(1).) — Section 4(1)(a) and (b) does not
exempt any person from testifying at an inquiry under the Act, but rather prevents the Com-
mission from inquiring into particular activities. Thus workmen, employees and fishermen
Act
may be compelled to testify at an inquiry into matters not covered by s. 4(1)(a) and (b).
4.1 [Repealed 2009, c. 2, s. 407.]
5. (1) Underwriters — Section 45 does not apply in respect of an agreement

or arrangement between persons who are members of a class of persons who
ordinarily engage in the business of dealing in securities or between such per-
sons and the issuer of a specific security, in the case of a primary distribution,
or the vendor of a specific security, in the case of a secondary distribution, if
the agreement or arrangement has a reasonable relationship to the underwrit-
ing of a specific security.
(2) Definition of “underwriting” — For the purposes of this section, “un-
derwriting” of a security means the primary or secondary distribution of the
security, in respect of which distribution
(a) a prospectus is required to be filed, accepted or otherwise approved
pursuant to a law enacted in Canada or in a jurisdiction outside Canada
for the supervision or regulation of trade in securities; or
(b) a prospectus would be required to be filed, accepted or otherwise ap-
proved but for an express exemption contained in or given pursuant to a
law mentioned in paragraph (a).
1999, c. 2, s. 2; 2009, c. 2, s. 408
6. (1) Amateur sport — This Act does not apply in respect of agreements or
arrangements between or among teams, clubs and leagues pertaining to par-
ticipation in amateur sport.
(2) Definition of “amateur sport” — For the purposes of this section,
“amateur sport” means sport in which the participants receive no remunera-
tion for their services as participants.
Commentary
See also section 48, which creates a criminal offence in relation to agreements and arrange-
ments in professional sport.
9
S. 7(1) Competition Act
PART II — ADMINISTRATION (SS. 7–29.2)

[Heading amended 1999, c. 2, s. 3.]
7. (1) Commissioner of Competition — The Governor in Council may

appoint an officer to be known as the Commissioner of Competition, who shall
be responsible for
(a) the administration and enforcement of this Act; and
(b) the administration and enforcement of the Consumer Packaging and
Labelling Act, the Precious Metals Marking Act and the Textile Labelling
Act.
(c) [Repealed 2012, c. 24, s. 79.]
(d) [Repealed 2012, c. 24, s. 79.]
(2) Oath of office — The Commissioner shall, before taking up the duties of
the Commissioner, take and subscribe, before the Clerk of the Privy Council,
an oath or solemn affirmation, which shall be filed in the office of the Clerk, in
the following form:
I do solemnly swear (or affirm) that I will faithfully, truly and impar-
tially, and to the best of my judgment, skill and ability, execute the
powers and trusts reposed in me as Commissioner of Competition. (In
the case where an oath is taken add “So help me God”.)
(3) Salary — The Commissioner shall be paid such salary as may be from
time to time fixed and allowed by the Governor in Council.
1999, c. 2, ss. 4, 37(a); 2012, c. 24, s. 79
Commentary
Subsection 7(1) confirms the authority of the Commissioner as to the administration and
enforcement of the Competition Act, the Consumer Packaging and Labelling Act, the Textile
Labelling Act, and the Precious Metals Marking Act.
Case Law
Tas Communications Systems Ltd. v. Nfld. Tel. Co. (1981), 22 C.P.C. 97, 59 C.P.R. (2d) 144,
33 Nfld. & P.E.I.R. 508, 93 A.P.R. 508 (Nfld. T.D.) — An application by the Director of
Investigation and Research to be added as a party or intervene as an amicus curiae in an
action against a public utility was dismissed. There are few, if any, actions which do not to
some degree affect the public interest. A wish to further that interest does not justify an
intervention in an action between others.
Re Imp. Tobacco Co. and McGregor, [1939] O.R. 627, 72 C.C.C. 321, [1939] 4 D.L.R. 99
(C.A.) — The Commissioner appointed under the 1927 Act exercised administrative, not ju-
dicial, functions, and his report did not determine rights.
8. (1) Deputy Commissioners — One or more persons may be appointed

Deputy Commissioners of Competition in the manner authorized by law.
10
Part II — Administration (ss. 7–29.2) S. 9(2)(b)
(2) Powers of Deputy — The Governor in Council may authorize a Deputy

Commissioner to exercise the powers and perform the duties of the Commis-
sioner whenever the Commissioner is absent or unable to act or whenever
there is a vacancy in the office of Commissioner.
(3) Powers of other persons — The Governor in Council may authorize
Act
any person to exercise the powers and perform the duties of the Commissioner
whenever the Commissioner and the Deputy Commissioners are absent or un-
able to act or, if one or more of those offices are vacant, whenever the holders
of the other of those offices are absent or unable to act.
(4) Inquiry by Deputy — The Commissioner may authorize a Deputy Com-
missioner to make inquiry regarding any matter into which the Commissioner
has power to inquire, and when so authorized a Deputy Commissioner shall
perform the duties and may exercise the powers of the Commissioner in re-
spect of that matter.
(5) Powers of Commissioner unaffected — The exercise, pursuant to
this Act, of any of the powers or the performance of any of the duties of the
Commissioner by a Deputy Commissioner or other person does not in any way
limit, restrict or qualify the powers or duties of the Commissioner, either gen-
erally or with respect to any particular matter.
1999, c. 2, s. 5
9. (1) Application for inquiry — Any six persons resident in Canada who
are not less than eighteen years of age and who are of the opinion that
(a) a person has contravened an order made pursuant to section 32, 33 or
34, or Part VII.1 or VIII,
(b) grounds exist for the making of an order under Part VII.1 or VIII, or
(c) an offence under Part VI or VII has been or is about to be committed,
may apply to the Commissioner for an inquiry into the matter.
(2) Material to be submitted — An application made under subsection (1)
shall be accompanied by a statement in the form of a solemn or statutory dec-
laration showing
(a) the names and addresses of the applicants, and at their election the
name and address of any one of their number, or of any attorney, solicitor
or counsel, whom they may, for the purpose of receiving any communica-
tion to be made pursuant to this Act, have authorized to represent them;
(b) the nature of
(i) the alleged contravention,
(ii) the grounds alleged to exist for the making of an order, or
(iii) the alleged offence
and the names of the persons believed to be concerned therein and privy
thereto; and
11
S. 9(2)(c) Competition Act
(c) a concise statement of the evidence supporting their opinion.

R.S.C. 1985, c. 19 (2nd Supp.), s. 22; 1999, c. 2, ss. 6, 37(b)
Case Law
Ashley v. Canada (Commissioner of Competition) (2006), 47 C.P.R. (4th) 379 (F.C.T.D.) —
The applicants, who were a group of professionals, applied to the Commissioner of Competi-
tion under s. 9 of the Act for an inquiry concerning representations by cigarette manufactur-
ers promoting their tobacco items as “light” or “mild”. The applicants alleged that such rep-
resentations were false and misleading in a material respect, contrary to ss. 52 and 74.01 of
the Act. Seven months passed without any correspondence between the parties. Upon receiv-
ing correspondence asking about the status of the inquiry, the Commissioner reassured the
applicants that the inquiry under s. 10 of the Act was ongoing. Approximately 17 months
after the inquiry was commenced, the applicants applied for an order of mandamus compel-
ling the Commissioner to complete the inquiry and to refer the matter to the Attorney Gen-
eral for prosecution under s. 52 of the Act or apply to the court for an order under s. 74.1 of
the Act. The application was dismissed as the Commissioner had no duty to complete an
inquiry that had been commenced upon receipt of an application under s. 9 of the Act. The
Commissioner’s method of conducting the inquiry was the exercise of his or her discretion,
and mandamus was not available to compel the specific exercise of that discretion.
Petrofina Canada Ltd. v. Canada (Restrictive Trade Practices Commission) (1979), [1980] 2
F.C. 386, 46 C.P.R. (2d) 1 (F.C.A.) — The fact that one of the six applicants for an inquiry
was not a Canadian citizen was an irregularity only and did not affect the validity of the
subsequent decision of the director to hold an inquiry.
10. (1) Inquiry by Commissioner — The Commissioner shall

(a) on application made under section 9,
(b) whenever the Commissioner has reason to believe that
(i) a person has contravened an order made pursuant to section 32,
33 or 34, or Part VII.1 or Part VIII,
(ii) grounds exist for the making of an order under Part VII.1 or Part
VIII, or
(iii) an offence under Part VI or VII has been or is about to be com-
mitted, or
(c) whenever directed by the Minister to inquire whether any of the cir-
cumstances described in subparagraphs (b)(i) to (iii) exists,
cause an inquiry to be made into all such matters as the Commissioner consid-
ers necessary to inquire into with the view of determining the facts.
(2) Information on inquiry — The Commissioner shall, on the written re-
quest of any person whose conduct is being inquired into under this Act or any
person who applies for an inquiry under section 9, inform that person or cause
that person to be informed as to the progress of the inquiry.
(3) Inquiries to be in private — All inquiries under this section shall be
conducted in private.
R.S.C. 1985, c. 19 (2nd Supp.), s. 23; 1999, c. 2, ss. 7, 37(c); 1999, c. 31, s. 45
12
Part II — Administration (ss. 7–29.2) S. 10
Commentary
Section 10 sets out the circumstances in which the Commissioner will commence formal
inquiries. Although the Commissioner can and often does carry out informal inquires, a sec-
tion 10 inquiry must be initiated in order for the Commissioner to use formal information-
gathering powers under section 11. Subsection 22(4) provides that the Minister of Industry
may review any decision of the Commissioner to discontinue an inquiry under section 10,
Act
and may instruct the Commissioner to make further inquiry. Section 10 is also relevant to
sections 21, 23, 29.1, 29.2, 74.11 and 100. Case law has established that decisions to com-
mence and discontinue inquiries are administrative acts and not subject to judicial review.
Subsection 10(3) establishes that section 10 inquiries are to be conducted in private. There-
fore, the Bureau does not typically announce or publicly confirm that an inquiry has begun
or is ongoing. An exception is where the fact of an inquiry becomes public knowledge
through some other means, such as the commencement of court proceedings. In 2020, the
Bureau appeared to depart from this well-established practice by announcing that it was in-
vestigating Amazon.ca’s sales practices and requested information from market participants
in connection with potential abuses of dominance. Presumably the Bureau had not formally
commenced a section 10 inquiry and therefore believed it had a technical basis for making
the announcement, albeit one that does not seem in keeping with the spirit of the legislation.
For additional detail on the Bureau’s interpretation on section 10(3), see Information Bulletin
on Communication During Inquiries (Ottawa: Competition Bureau, 2014).
Case Law
Canada (Commissioner of Competition) v. Labatt Brewing Co., 2007 CarswellNat 1611
(Competition Trib.); affirmed 2008 CarswellNat 134, 2008 CarswellNat 708 (F.C.A.) — The
Commissioner of Competition sought an interim order from the Competition Tribunal under
s. 100 of the Act, requesting a 30-day delay in the closing of the merger transaction as the
Competition Commissioner had not yet completed her review pursuant to subparagraph
10(1)(b)(ii) of the Act. In this case, Labatt was acquiring discount beer maker, Lakeport
Brewing, and proposed to complete their transaction some six weeks after making their pre-
merger notification. In order for the Competition Tribunal to grant more time for the Com-
missioner’s inquiry, the Tribunal must be satisfied that the lack of an order under s. 100 of
the Act would substantially impair the Tribunal’s ability to remedy the effect of the proposed
merger on competition because that action would be difficult to reverse. In rejecting the
Commissioner’s request, the Tribunal concluded its ability to remedy the effects of the
merger was not substantially impaired. Although the closing of the transaction would pre-
vent the Tribunal from blocking the transaction, the Tribunal had other available measures to
remedy a potential lessening of competition.
Cinémas Guzzo Inc. c. Canada (Procureur général) (2005), (sub nom. Cinémas Guzzo Inc.
v. Canada (Attorney General)) 47 C.P.R. (4th) 250 (F.C.); affirmed 2006 CarswellNat 1294,
2006 CAF 160 (F.C.A.); leave to appeal refused (2006)), 2006 CarswellNat 3847, 2006 Car-
swellNat 3848 (S.C.C.) — The applicant filed a complaint with the Competition Bureau con-
cerning access by its movie theatres to first-run films as the distributors gave exclusive rights
to two other movie theatre chains. The Commissioner commenced an inquiry pursuant to s.
10 of the Act. The Commissioner sent the applicant a report of his preliminary findings, and
later informed the applicant that an economist had been retained to analyze the evidence.
The Commissioner subsequently issued a report summarizing the economist’s findings, and
stating that there was insufficient evidence to support a finding of anticompetitive practices.
The Competition Bureau refused to provide a copy of the economist’s report, but offered to
13
meet with the applicant in order to provide further information to help prepare its response to
the Commissioner’s report. The Commissioner later informed the applicant that the inquiry
was being discontinued, and the applicant applied for judicial review of that decision. The
application for judicial review was dismissed. As the Commissioner’s decision to discon-
tinue an inquiry was an administrative act, the courts must defer to such discretionary deci-
sions in the absence of bad faith on the part of the decision makers. The Commissioner’s
duty of fairness was minimal, and there was no obligation to disclose the economist’s report.
Ashley v. Canada (Commissioner of Competition) (2006), 47 C.P.R. (4th) 379 (F.C.) — The
applicants, who were a group of professionals, applied to the Commissioner of Competition
under s. 9 of the Act for an inquiry concerning representations by cigarette manufacturers
promoting their tobacco items as “light” or “mild”. The applicants alleged that such repre-
sentations were false and misleading in a material respect, contrary to ss. 52 and 74.01 of the
Act. Seven months passed without any correspondence between the parties. Upon receiving
correspondence asking about the status of the inquiry, the Commissioner reassured the appli-
cants that the inquiry under s. 10 of the Act was ongoing. Approximately 17 months after the
inquiry was commenced, the applicants applied for an order of mandamus compelling the
Commissioner to complete the inquiry and to refer the matter to the Attorney General for
prosecution under s. 52 of the Act or apply to the court for an order under s. 74.1 of the Act.
The application was dismissed as the Commissioner had no duty to complete an inquiry that
had been commenced upon receipt of an application under s. 9 of the Act. The Commis-
sioner’s method of conducting the inquiry was the exercise of his or her discretion, and
mandamus was not available to compel the specific exercise of that discretion.
Charette v. Canada (Commissioner of Competition) (2003), 29 C.P.R. (4th) 1 (Fed. C.A.);
affirming (2002), 20 C.P.R. (4th) 61, 221 F.T.R. 37 (Fed. T.D.) — The applicant made com-
plaints of anti-competitive activities. The Commissioner made numerous investigations into
these matters, at the request of the applicant, over a period of 22 months. On each occasion,
the Commissioner determined that there was no substance to the complaints. After making
informal requests, the applicant decided to make a formal request under s. 10(1)(a) of the
Act for an inquiry respecting the same complaints, with no new evidence adduced. The ap-
plication was dismissed as amounting to an abuse of process. The applicant then applied for
judicial review of the Commissioner’s decision not to pursue the inquiry. The application for
judicial review was dismissed, and the dismissal was upheld on appeal. The Commissioner
had already spent over 500 hours investigating the complaints over a 22-month period. The
Commissioner had fully performed his duty under the Act, and was not obligated to initiate
an inquiry.
Warner Music Group Inc., Re (1997), 138 F.T.R. 140, (sub nom. Canada (Director of
Investigation & Research) v. Warner Music Group Inc.) 78 C.P.R. (3d) 335 (T.D.) — Sec-
tion 10 mandates that the Director inquire with a view of determining the facts. In filing a
notice of application before the Tribunal, the Director will have concluded that there exists
sufficient information to initiate the proceedings but that does not necessarily mean that the
Director has determined the facts. All parties can continue to obtain information in support
of their case prior to the hearing.
Law Society of Upper Canada v. Canada (Attorney General) (1996), 134 D.L.R. (4th) 300,
28 O.R. (3d) 460, 67 C.P.R. (3d) 48 (Gen. Div.) — The application of the regulated conduct
exemption enunciated by the Supreme Court of Canada in A.G. Can. v. Law Soc. of B.C.;
Jabour v. Law Soc. of B.C., [1982] 2 S.C.R. 307, [1982] 5 W.W.R. 289, 37 B.C.L.R. 145, 19
B.L.R. 234, 66 C.P.R. (2d) 1, 137 D.L.R. (3d) 1, 43 N.R. 451 — see annotation under s.
45 — should be determined prior to the conduct of an inquiry under s. 10.
14
Part II — Administration (ss. 7–29.2) S. 11(1)(a)
The “regulated conduct” exemption is applicable not only to criminal offences but also to
reviewable practices.
The requirement of the Law Society that its members obtain professional liability insurance
and to compel participation in its own plan and to pay levies therefor, fell within the “...
specific legislative authority to implement a mandatory professional liability insurance
scheme for its members...”. The Director therefore did not have authority to continue its
Act
investigation.
Canada (Director of Investigation & Research) v. Air Canada (1993), 46 C.P.R. (3d) 312
(Competition Trib.) — Solicitor and client privilege cannot be claimed on material that is
voluntarily delivered to the Director for purposes of conducting an inquiry pursuant to s. 10
of the Act.
Canada (Director of Investigation & Research) v. Southam Inc. (1991), 38 C.P.R. (3d) 390
(Competition Trib.) — The requirement pursuant to s. 10(3) of the Act that all inquiries
made by the Director be conducted in private applies only to the inquiry or investigation
stage of the Director’s mandate. Once proceedings go before the Tribunal, the process be-
comes a public one, as set out in r. 40(1) of the Competition Tribunal Rules.
Gauthier v. Canada (Consumer & Corporate Affairs) (1991), (sub nom. Gauthier v. Director
of Investigation & Research, Competition Act) 139 N.R. 77 (F.C.A.) — The Director’s re-
fusal to order an investigation under s. 10(1)(b)(ii) of the Act is a purely administrative deci-
sion not required by law to be made on a judicial or quasi-judicial basis and is, therefore, not
reviewable under s. 28 of the Federal Court Act.
Ziegler v. Canada (Director of Investigation & Research) (1983), 75 C.P.R. (2d) 163, 39
C.P.C. 203 (F.C.T.D.); affirmed (1983), 75 C.P.R. (2d) 246 (F.C.T.D.) — The applicant’s
application to have certain sections of the Act declared invalid was dismissed. The applicant
appealed this decision, and applied to have an inquiry being conducted under the Act sus-
pended pending the appeal. This application was also dismissed. Duly enacted laws are pre-
sumed to be valid unless and until a specific finding to the contrary is made by a court of
competent jurisdiction.
Stevens v. Restrictive Trade Practices Comm., [1979] 2 F.C. 159, 43 C.P.R. (2d) 1, 98
D.L.R. (3d) 662. (See also entries under ss. 4(1)(a), (b), 9.) — In conducting an inquiry
under the Act, the commission performs a purely administrative function and not a judicial
or quasi-judicial function since the inquiry does not in any way determine the rights of per-
sons involved but rather results in a report to the minister, who may or may not lay charges.
11. (1) Order for oral examination, production or written return —

If, on the ex parte application of the Commissioner or his or her authorized
representative, a judge of a superior or county court is satisfied by informa-
tion on oath or solemn affirmation that an inquiry is being made under section
10 and that a person has or is likely to have information that is relevant to the
inquiry, the judge may order the person to
(a) attend as specified in the order and be examined on oath or solemn
affirmation by the Commissioner or the authorized representative of the
Commissioner on any matter that is relevant to the inquiry before a per-
son, in this section and sections 12 to 14 referred to as a “presiding of-
ficer”, designated in the order;
15
S. 11(1)(b) Competition Act
(b) produce to the Commissioner or the authorized representative of the

Commissioner within a time and at a place specified in the order, a re-
cord, a copy of a record certified by affidavit to be a true copy, or any
other thing, specified in the order; or
(c) make and deliver to the Commissioner or the authorized representa-
tive of the Commissioner, within a time specified in the order, a written
return under oath or solemn affirmation showing in detail such informa-
tion as is by the order required.
(2) Records in possession of affiliate — Where the person against
whom an order is sought under paragraph (1)(b) in relation to an inquiry is a
corporation and the judge to whom the application is made under subsection
(1) is satisfied by information on oath or solemn affirmation that an affiliate of
the corporation, whether the affiliate is located in Canada or outside Canada,
has records that are relevant to the inquiry, the judge may order the corpora-
tion to produce the records.
(3) No person excused from complying with order — No person
shall be excused from complying with an order under subsection (1) or (2) on
the ground that the testimony, record or other thing or return required of the
person may tend to criminate the person or subject him to any proceeding or
penalty, but no testimony given by an individual pursuant to an order made
under paragraph (1)(a), or return made by an individual pursuant to an order
made under paragraph (1)(c), shall be used or received against that individual
in any criminal proceedings thereafter instituted against him, other than a
prosecution under section 132 or 136 of the Criminal Code.
(4) Effect of order — An order made under this section has effect anywhere
in Canada.
R.S.C. 1985, c. 19 (2nd Supp.), s. 24; 1999, c. 2, s. 37(d); 2002, c. 8, s. 126; 2002, c. 16,
s. 1
Commentary
Section 11 contains powers to compel: attendance of a person for the purposes of examina-
tion (paragraph 11(1)(a)); the production of documents (paragraph 11(1)(b)); and the deliv-
ery of written information under oath (paragraph 11(1)(c)). Oral examinations under para-
graph 11(1)(a) are rare but the Commissioner of Competition frequently brings applications
for orders under paragraphs 11(1)(b) and 11(1)(c) in a wide variety of criminal and civil
investigations.
Section 11 requires the Commissioner to satisfy a two-part test before a judge will issue an
order. First, the Commissioner must establish that an inquiry is being made under section 10.
Second, the Commissioner must establish that a person has or is likely to have information
relevant to the inquiry. These requirements are normally satisfied in an ex parte application,
without notice to the target of the order, on the basis of affidavit evidence. On an ex parte
section 11 application, the Commissioner has an obligation to disclose to the court all rele-
vant facts, including principles of law known to favour the other side. This requirement is
intended to reduce the inherent risk of injustice present in ex parte situations, where the court
is asked to grant an order in the absence of the other party. As a practical matter, this disclo-
16
sure requirement means that submissions made to the Commissioner as to the volume or
adequacy of the information provided to the Commissioner in the context of an inquiry ought
to be disclosed to the court as part of an ex parte application. Although court orders will not
be set aside lightly, material non-disclosure may and has resulted in courts setting aside
section 11 orders. It is therefore usually prudent to request or obtain a copy of the Commis-
sioner’s affidavit supporting the ex parte application to confirm the adequacy of the
Act
application.
In 2008, the Deputy Minister of Justice and the Commissioner of Competition appointed
Brian Gover to review and advise on the Competition Bureau’s s. 11 process. Amongst other
things, Gover recommended that counsel personally attend on all s. 11 applications and that,
whenever possible, the Commissioner should apply to the same judge for all s. 11 orders
obtained in a particular inquiry. He also recommended that the Bureau should engage in both
a pre-application and post-service dialogue with respondents to s. 11 orders. This dialogue
should be the norm, according to Gover, although there will be circumstances where the
Bureau will need to make s. 11 applications without such dialogue, such as when there is
urgency or when there is a concern that records in the possession of a respondent may be
destroyed. See: Letter from Brian Gover to John Sims and Sheridan Scott, Review of s. 11 of
the Competition Act, 12 August 2008. See also: Omar Wakil and Sue-Anne Fox, Putting the
Commissioner on Notice: The Labatt Section 11 Case, Canadian Competition Record
(Spring 2008) at p. 1.
In practice, the Bureau follows the recommendations of the Gover report. When engaging in
pre-issuance dialogue, the Bureau shares portions of the proposed draft order with the entity
that will receive the order. It will normally schedule a pre-hearing call to discuss how the
recipient keeps its information, whether there are alternative sources or forms of information
that may be more responsive than the specifications in the draft order, and to ascertain
whether there are any other factors that might impair the ability of the recipient to comply
with the order. The purpose of the dialogue is not to serve as a forum for debate or negotia-
tion on the merits of the inquiry or the relevance of the information requested. Although
hearings are ex parte, the Bureau has an obligation to bring to the attention of the court any
concerns raised by the recipient of the order during the pre-issuance dialogue. This can and
has resulted in orders being modified by the issuing judge.
In 2013 the Commissioner announced that as a matter of enforcement policy “the Bureau’s
first course of action in obtaining information from the target of a formal inquiry in non-
merger cases will be, for all but exceptional cases, obtaining a legally binding section 11
order from the Court.” See John Pecman, Interim Commissioner of Competition, Remarks,
Norton Rose, Montréal, Quebec, 30 January 2013.
Orders requiring the production of records often are expansive: the definition of “records” is
broad under section 2 of the Act and orders usually require targets to search the paper and
electronic files of multiple individuals.
In the 2019 proposed acquisition of the assets associated with the natural cheese business of
Kraft Heinz Canada ULC by Paramalat S.p.A., the Bureau obtained a paragraph 11(1)(a)
order requiring executives of the merging parties to be interviewed under oath by Bureau
investigators in addition to its power under subsection 114(2) of the Competition Act to com-
pel additional documentary productions or a “supplementary information request.” See also
the commentary to section 114.
Subsection 11(2) purports to permit a Court to order a (Canadian) corporation to produce
records of its affiliates, regardless of whether the affiliate is located inside or outside Canada.
There are numerous uncertainties about the scope of the application of this subsection, which
17
has never been judicially tested. It may require action which the Canadian corporation has no
legal capacity to carry out. For example, the Canadian corporation may have no legal right to
require that its (foreign) affiliates provide it with the requested records. Nevertheless, “extra-
territorial” subsection 11(2) orders are occasionally sought in international price-fixing cases
where the Competition Bureau believes that relevant information may be located overseas.
However, there is no obligation for the recipient of a section 11 order to provide records it
does not have or cannot obtain, as is usually the case where the records are in the possession
and control of a foreign affiliate. Notably, subsection 11(2) only applies to “corporations”,
although under section 2, a partnership, sole proprietorship, trust or other unincorporated
organization capable of conducting business could also have affiliates.
Subsection 11(3) states that persons are not excused from complying with an order on the
grounds that such testimony, records, or written returns may incriminate them. However,
consistent with the Canadian Charter of Rights and Freedoms, any testimony provided by an
individual under paragraph 11(1)(a) or returns made by an individual under paragraph
11(1)(c), cannot generally be used against such individual in any criminal proceeding against
that individual.
Subsection 19(1) sets out a special procedure for dealing with documents that may be subject
to a claim of privilege. Such documents cannot be immediately seized by officers under a
search warrant. They must be sealed pending an assessment of the validity of the privilege
claim within a limited time.
Non-compliance with a section 11 order without “good and sufficient cause” is a criminal
offence under subsection 65(1). Similarly, the destruction or alteration of records responsive
to a section 11 order is an offence under subsection 65(2).
In Commissioner of Competition v. Saskatchewan Telecommunications, Tbaytel, Rogers
Communications Inc., Videotron Ltd., Bragg Communications, Telus Corporation, MTS Inc.,
Bell Mobility Inc., (ex parte motion proceedings), Chief Justice Crampton expressed concern
about the costs of responding to orders for third parties that are not the targets of Bureau
investigations. In that case, he acceded to a request for more time to respond to the order and
for a “reasonable efforts” qualifier to be added to the order. (“[T]he Respondent shall not be
required to provide any information described in Schedule I to this Order where it certifies
that it has made all reasonable efforts to provide the information required by the Specifica-
tion and that additional efforts to provide the information would be excessive, disproportion-
ate or unnecessarily burdensome. Such certification shall be accompanied by a statement that
permits the Commissioner to assess the Respondent’s position and, at the Commissioner’s
discretion, to challenge that position before this Court”).
See generally Information Bulletin on Section 11 of the Competition Act (Ottawa: Competi-
tion Bureau, November 2005) and Antonio Di Domenico, Competition Enforcement and Lit-
igation in Canada (Toronto: Emond Montgomery Publications Limited, 2019) at page 42.
See also Letter from the National Competition Law Section of the Canadian Bar Association
to the Commissioner of Competition on the Information Bulletin on Section 11 of the Compe-
tition Act (February 2007).
Case Law
Canada (Commissioner of Competition) v. Saskatchewan Telecommunications, 2015 FC 990
(F.C) — Bell was required to produce documents as part of the Competition Bureau’s in-
quiry under section 10 relating to practices by Apple Inc. Bell expressed concerns that the
Bureau’s section 11 order was overbroad and that Bell had insufficient time to respond. The
Court expressed concerns regarding the costs imposed on Bell as an “innocent” third party,
18
questioned why the Bureau was unwilling to give Bell an additional two weeks to respond
when the inquiry had been ongoing for over a year, and noted generally the difficulty of
responding in the summer months. A reasonableness qualifier was added to the order, ab-
solving Bell from the requirement to provide certain information where it certifies that it has
made all reasonable efforts to provide the information and additional efforts would be exces-
sive, disproportionate or unnecessarily burdensome.
Act
Canada (Commissioner of Competition) v. Indigo Books & Music Inc., 2015 FC 256 (Fed.
Ct.) — The Commissioner was entitled to seek information under an order despite offers by
a party for voluntary provision of the information on the basis that the Commissioner pro-
vided full and frank disclosure, the information or records described in the orders were rele-
vant to the inquiry in process, the scope of the information or records sought was not exces-
sive, disproportionate or unnecessarily burdensome, and the presumption that the
Commissioner’s actions were bona fide and in the public interest was not displaced. It was
reasonable to request information pertaining to a reasonable period of time pre-dating and
post-dating the inquiry.
Canada (Commissioner of Competition) v. Pearson Canada Inc., 2014 CarswellNat 1313,
[2014] F.C.J. No. 430 (F.C.) — The matter involved concerns about anti-competitive beha-
viour in the electronic publishing industry. The respondent publishers argued that the Com-
missioner failed to provide sufficient affidavit evidence concerning the existence of grounds
to make the order for production of records and that the draft order would require duplicate
production and the scope of requested production was unreasonable. The court held that the
Commissioner has limited disclosure obligations pursuant to ss. 11(1)(b) and 11(1)(c) and
was therefore only required to establish that an inquiry was made under s. 10 and the respon-
dents were likely to have information relevant to the inquiry. In the absence of evidence of
bad faith or other evidence that the Commissioner’s inquiry was not bona fide, the inquiry
would be presumed to be so. However, due to the ex parte nature of the application, the
Commissioner was required to make full and frank disclosure and the court was required to
satisfy itself that the information being sought was relevant to the inquiry and not excessive,
disproportionate, or unnecessarily burdensome. The scope of the requested production, in
terms of the types of material requested and the time period for production, was relevant and
therefore reasonable and the Commissioner’s revised draft order addressed the respondents’
concerns about duplicate production. Finally, a s. 11 application is not the appropriate forum
to address substantive competition concerns.
Canada (Commissioner of Competition) v. Toshiba of Canada Ltd., 2010 CarswellOnt 381
(Ont. S.C.J.) — In advance of a motion to set aside an ex parte section 11 order, Toshiba
Canada brought a motion seeking an order for production of records in the possession or
control of the Commissioner of Competition and an order to cross-examine the affiant on the
affidavit that was filed in support of the ex parte order. Toshiba Canada argued that that
requested relief was necessary in order for it to gather facts to properly argue, on the main
motion, the section 11 order was granted on inadequate and misleading information and that
it was unconstitutional. The motion was denied. The basis for Toshiba’s claim for production
was speculative, grounded in conjecture and lacked sufficient evidentiary foundation. There
is no presumptive right to cross-examination in the circumstances. Cross-examination was
not necessary or justified because the record was adequate and there was no evidentiary
foundation to justify the exploration of Toshiba’s inquiries. Toshiba’s appeal to the Divi-
sional Court was dismissed.
Canada (Commissioner of Competition) v. Labatt Brewing Co., 2008 FC 59 (F.C.T.D.) —
The court set aside a s. 11 order issued against Labatt and Lakeport, without prejudice to the
right of the Commissioner to bring a fresh application for a further s. 11 order on notice to
19
both Labatt and Lakeport. The court found that the information provided by the Commis-
sioner on the ex parte application was misleading, inaccurate and incomplete. The Commis-
sioner bears the burden of making full and frank disclosure when seeking ex parte relief
under s. 11, including a duty of ensuring that the court is fully apprised of the relevant facts
and circumstances surrounding the request. Section 11 does not mandate that the court act as
a mere “rubber stamp”, automatically issuing production orders once the two conditions
identified in s. 11 have been satisfied.
Canada (Commissioner of Competition) v. Moosehead Breweries Ltd., 2008 FC 105
(F.C.T.D.) — The court set aside a s. 11 order issued against Moosehead, without prejudice
to the right of the Commissioner to bring a fresh application for a further s. 11 order, on
notice to Moosehead. The court’s reasons were substantially similar to its reasons for grant-
ing the same relief in Canada (Commissioner of Competition) v. Labatt Brewing Co., 2008
FC 59 (F.C.). This decision should be read in conjunction with the reasons in the Labatt case.
Canada (Commissioner of Competition) v. Canada Pipe Co. (2003), 28 C.P.R. (4th) 335
(Competition Trib.) — The Commissioner applied to the Tribunal for an order under ss. 77
and 79 of the Act, concerning alleged exclusive dealing and abuse of dominant position by
Canada Pipe. The Commissioner’s disclosure statement included a list of records to be relied
on at the hearing, five statements summarizing the will-say statements of 42 non-expert wit-
nesses whose names and addresses were not identified, and a statement of economic theory
in support of the application. Canada Pipe brought a motion seeking a declaration that cer-
tain provisions of the Rules were inoperative as violating its right to a fair hearing as guaran-
teed by s. 2(e) of the Canadian Bill of Rights. Canada Pipe alleged that the Commissioner
provided inadequate disclosure of the documents and witness will-say statements, and im-
properly asserted public interest privilege over documents and information. Canada Pipe also
sought relief to limit the Commissioner’s further use of s. 11 of the Act, which gave the
Commissioner power to apply for ex parte orders to examine under oath any person who had
relevant information. The Commissioner requested that Canada Pipe file a response and dis-
closure statement in accordance with the Rules.
The Commissioner was ordered to provide a fresh disclosure statement containing a list of
all records on which he intended to rely and separate will-say statements for each non-expert
witness. Canada Pipe was ordered to serve and file its response and serve its disclosure state-
ment pursuant to the Rules. Canada Pipe’s right to a fair hearing would be fulfilled by a
process that provided it the right to know the case against it and the right to have a meaning-
ful opportunity to present evidence supporting its own case. The Commissioner had not com-
plied with the Rules in serving Canada Pipe with amalgamated will-say statements. The
Rules required that a will-say statement be provided for each non-expert witness. Case man-
agement procedures added flexibility that may allow for disclosure of the identity of non-
expert witnesses by name and address more than two days before a particular witness was
called to testify.
The Tribunal did not have jurisdiction over the Commissioner’s exercise of the powers
granted by s. 11 of the Act. The Tribunal exercised control over the introduction of informa-
tion obtained under s. 11 that arose after the Commissioner had served his disclosure state-
ment. Any unfairness that may arise from an attempt by the Commissioner to amend the
disclosure statement after it has been filed may be controlled by the Tribunal. Any concerns
Canada Pipe had about the Commissioner’s unfair control of the timing of an authorization
to read into evidence information obtained pursuant to a s. 11 order could be adequately
addressed by the Tribunal when it considered the request to grant such an authorization.
Cadillac Fairview Corp. v. Canada (Commissioner of Competition) (2003), 29 C.P.R. (4th)
33 (Ont. S.C.J.) — The Commissioner commenced an inquiry into an alleged conspiracy
20
between two commercial landlords and a lawyer to enhance unreasonably the access fees
charged to telecommunication service providers, and to prevent or unduly lessen competition
in the sale and supply of telecommunication services. The landlords had negotiated agree-
ments granting access to buildings for the purpose of providing telecommunication services
to tenants. The lawyer had acted for both landlords with respect to these agreements. The
Commissioner obtained an order pursuant to s. 11 of the Act for the production of certain
Act
records and examinations. The applicants sought a declaration that certain documents or-
dered to be produced were subject to solicitor-client privilege. The court ordered that a refe-
ree be appointed to determine whether solicitor-client privilege was properly claimed. Solici-
tor-client privilege will be lost if the communication was made for the purpose of obtaining
legal advice to facilitate the commission of a crime, or if the communication itself was crimi-
nal in nature. In this instance, there was concern over whether the lawyer was passing price
information between the clients, and thereby allowing them to coordinate pricing. Such com-
munication, if made, would not be privileged as it would be in the nature of business infor-
mation and, in addition, would appear to have been made in the furtherance of a criminal
offence.
Ravenshoe Services Ltd. v. Canada (Commissioner of Competition) (2001), 15 C.P.R. (4th)
543 (Ont. S.C.J.) — The Commissioner commenced an inquiry into allegations that the ap-
plicants had made false or misleading misrepresentations in contravention of s. 52 of the Act.
The Commissioner obtained an order under s. 11 of the Act requiring the applicants to pro-
duce certain records and make written returns of information. The Commissioner had ob-
tained search warrants targeting the applicants in respect of the inquiry both before and after
the s. 11 order was issued. The applicants sought an order setting aside the s. 11 order, and
declaring s. 11 of the Act to be of no force or effect to the extent that it authorizes an order to
obtain information to substantiate a prosecution of alleged offences under the Act. The appli-
cation was dismissed. As the nature of the Competition Act was regulatory, s. 8 of the Char-
ter was treated with more flexibility than in cases where it is of a criminal context. The
nature of a Commissioner’s order under s. 11 of the Act was with reference to corporate
information and data and, as such, there was a limited expectation of privacy. Although prior
searches and seizures had been carried out pursuant to ss. 15 and 16 of the Act, this did not
preclude the Commissioner from making demands under s. 11 of the Act. The documents
and information sought in the s. 11 order became available after the searches were carried
out.
Canada (Commissioner of Competition) v. Air Canada (2000), 8 C.P.R. (4th) 372 (F.C.
T.D.) — Air Canada brought a motion to have an ex parte s. 11 order set aside or varied. The
motion was dismissed. At issue was whether: a s. 11 order could be reviewed or appealed
and, if so, the circumstances that would justify varying or rescinding an ex parte order;
whether the documentation and information sought by the Commissioner was relevant to the
inquiry into Air Canada’s conduct; and whether s. 11 violated the Charter.
The court held that the Act does not provide a complete statutory code for governing the
issuance of s. 11 orders. When such orders are obtained from the Federal Court, they are
governed by the Federal Court Rules, which permit an order to be varied or rescinded. How-
ever, an order of the court, even an ex parte order, is not lightly set aside. What must be
proven is that the order was granted on the basis of on misleading, incomplete, or incorrect
facts. The non-disclosure or errors in the evidence placed before the issuing judge must be
such as to have caused the issuing judge, had he or she known of them, to have refused to
grant the order. However, if the person against whom the order was issued can show that
documents or information are irrelevant to the inquiry, the portions of the order that require
their production can be vacated. Also, if there are considerations of constitutionality or other
21
illegality that have not been brought to the attention of the issuing judge, these can be raised
in a motion when the order is issued ex parte.
Air Canada did not demonstrate that the Commissioner’s application was incomplete, mis-
leading or incorrect to a degree that would have led the judge to refuse to grant the order. Air
Canada suggested that the court must be satisfied that reasonable grounds exist to believe
that the matter under investigation has occurred. The court disagreed. Under s. 11, the court
is only required to satisfy itself that: (1) an inquiry has been commenced; and (2) the person
against whom the order is made is likely to have information relevant to the inquiry. The
statutory scheme is different than s. 15 pursuant to which search and seizure warrants are
issued.
On the question of relevancy, the court was, on a general level, not persuaded that Air Can-
ada had shown that the documentation and information sought by the Commissioner were
irrelevant to his inquiry. However, that aspect of the motion was set aside to allow for a
discussion between the parties. At the time the order was sought, the Commissioner was not
familiar with the record-keeping practices of Air Canada and believed that if there were real
difficulties in responding to the requests this should be the subject of discussion between
counsel.
On the question of constitutionality, the court was not persuaded that s. 11 violated ss. 7
(self-incrimination) or 8 (unreasonable search and seizure) of the Charter.
Air Canada argued that s. 11 allows for unreasonable search and seizures because a court has
no residual discretion to refuse to issue an order. A court may issue an order only on proof
that an inquiry has been commenced, and that inquiry could have been commenced by the
Commissioner on a whim. The court disagreed. Section 11 provides that a judge may issue
an order. Residual discretion exists. Section 11 does not authorise the issuing of an order on
a “whim”. A court would not grant a s. 11 order on the basis of a bald assertion by the
Commissioner that an inquiry has been commenced. Any judge would require more than
that. He or she is likely to require some description of the nature of the alleged conduct that
is the subject of the inquiry, the basis of the Commissioner’s decision to commence an in-
quiry and his or her reason for believing that conduct to which the inquiry is addressed has
occurred. Also, the judge must be satisfied that the person against whom the order is sought
is likely to have relevant information. This does not mean that the court would second guess
the Commissioner’s decision that he or she has reasons to believe that the conduct that is the
subject of the inquiry in question occurred, but it does allow the court to refuse to grant an
order when there is insufficient evidence to support a conclusion that a bona fide inquiry has
been commenced.
Air Canada also argued that para. 11(1)(c) was invalid because it infringed the right to be
free of self-incrimination. The court disagreed. Although s. 7 is designed to protect individu-
als, not corporations, corporations may challenge the constitutionality of a statutory provi-
sion by establishing that if the provision in question were applied to an individual, an in-
fringement of s. 7 would occur. However, the court found that there would have been no
infringement in this case. The information that Air Canada was being required to produce
was only for the purpose of an inquiry, not for the purpose of a prosecution. Moreover, the
information that Air Canada was being asked to produce did not fall within the category of a
self-incriminating disclosure. A distinction should be drawn between pre-existing informa-
tion and compelled self-incriminating testimony. The information required to be disclosed
was pre-existing. To be required to respond to a written interrogatory may require the crea-
tion of a document that did not exist before. The fact that some work may be involved in
answering interrogatories did not make para. 11(1)(c) different in kind from paras. 11(1)(a)
and 11(1)(b). Both these provisions can lead to employees and officers of a corporation be-
22
ing required to undertake activities in which they would not otherwise engage (for example,
searching through filing cabinets in order to locate documents).
SGL Canada Inc. v. Canada (Director of Investigation & Research) (1998), 86 A.C.W.S.
(3d) 74 (F.C.T.D.) — The applicant corporation applied for a stay of an order made under s.
11 for oral examinations in respect of employees of the corporation. Section 11 only required
that an inquiry was being conducted by the Director under s. 10. In order to set aside the ex
Act
parte s. 11 order, the applicant would have to show willful omission or fraud in the Direc-
tor’s material filed before the judge who granted the order. There was no such evidence
presented. Moreover, the employees were not parties before the court but it was their em-
ployer that was the subject of the inquiry. The application for a stay was dismissed as there
was no serious issue, no irreparable harm and the balance of convenience was in favour of
the Director. There was a compelling public interest element in the Director’s investigative
authority. In rendering its decision, the Federal Court distinguished this case from the deci-
sion in TNT Canada Inc. v. Canada (Director of Investigation & Research), [1995] 2 F.C.
544, 60 C.P.R. (3d) 303, 93 F.T.R. 81 (F.C.T.D.) where the inquiry had ended, the matter
had been referred to the Attorney General of Canada and charges had been laid. In this case,
the Director had just commenced his inquiry and was proceeding under ss. 11 and 15 of the
Act.
Canada (Director of Investigation & Research) v. Thomson Corp. (1998), 84 C.P.R. (3d) 8
(F.C.T.D.) — The Director authorized an application for orders for the production of records
and the return of written information pursuant to paras. 11(1)(b) and (c) following the com-
mencement of an inquiry into a merger. An ex parte application was made to the court but a
judge of the court required that notice be given to counsel for the parties. A motion was
brought to determine whether counsel for the parties had standing to participate in the hear-
ing of the application. An ex parte hearing was ordered. Section 11 was clear as to the ex
parte nature of the application. Accordingly, the application was to proceed ex parte, and all
documents and motion records filed in respect of the application would be sealed.
North American Van Lines Canada Ltd. v. Canada (Director of Investigation & Research)
(1997), 136 F.T.R. 16, 78 C.P.R. (3d) 221, 4 Admin. L.R. (3d) 123 (T.D.) — In the course of
conducting an inquiry into an alleged conspiracy, the Director obtained orders pursuant to s.
11 requiring various persons, including representatives of the parties being inquired into, to
attend and be examined under oath before a presiding officer. At the commencement of the
oral examinations, the Director obtained an order excluding the parties and their counsel
from attending the examinations of the various witnesses. When the statutory basis for the
exclusion was challenged, the Director was entitled to conduct an in camera hearing in order
to preserve the confidentiality of the information. The presiding officer’s function is to en-
sure the proper and orderly conduct of the examination. Moreover, s. 11 oral examinations
are investigative and not adversarial and no substantive rights will be determined.
Investigation & Research) v. Warner Music Group Inc.) 78 C.P.R. (3d) 335 (T.D.) — In the
course of conducting an inquiry pursuant to s. 10 of the Act into a complaint of refusal to
deal, the Director obtained an order pursuant to s. 11 requiring the respondent to make pro-
duction of its records and a written return of information. Prior to the date specified for
compliance with the s. 11 order, the Director commenced an application before the Tribunal
with respect to the refusal to deal allegation. The filing of a notice of application before the
Tribunal did not in and of itself terminate a s. 10 inquiry.
Investigation & Research) v. Warner Music Group Ltd.) 78 C.P.R. (3d) 125 (T.D.) — The
applicant had unsuccessfully sought to set aside an order pursuant to s. 11 requiring it to
23
produce certain documents and information in the context of an inquiry being conducted by
the Director. The applicant sought a stay pending an appeal of the denial of the application.
In applying the classic three-part test to determine whether a stay should be granted, the
court found that the minor cost and inconvenience to the applicant was outweighed by the
public interest in the inquiry. These were civil proceedings and there was no right to privacy
for a person in the position of a witness in civil proceedings.
Canada (Director of Investigation & Research) v. Canadian Pacific Ltd. (1997), 74 C.P.R.
(3d) 167 (Competition Trib.) — Documents disclosed to the Director through a s. 11 order
have severely diminished expectation of privacy and privacy right that previously existed in
business records.
Canadian Pacific Ltd. v. Canada (Director of Investigation & Research) (1995), 61 C.P.R.
(3d) 137 (Ont. Gen. Div.) — Canada Pacific sought to set aside an order under para. 11(1)(a)
directing an individual to appear before a presiding officer. The application was dismissed.
The applicant did not have standing to object to the order; there was no provision to appeal
an order under the Act; and it would be difficult for the court to deal with the order on a
reconsideration basis “absent prima facie fraud or similar indications (which have not been
established).” Canada Pacific did not have standing because it had no proprietary interest in
the order. Although it was a party to the merger transaction being investigated by the Bu-
reau, it was not the party to be examined under the order. Procedural fairness was inapplica-
ble because the Director was merely pursuing an administrative function where he had
authorised an inquiry to be conducted under s. 10. There has been no decision to refer any-
thing to the Tribunal. Even if Canada Pacific had standing, the application would be dis-
missed. The thrust of the application was that there had been material non-disclosure in ob-
taining the order. This was not sufficient to set aside the order because the Director had
satisfied the two-part requirement to obtain an order under s. 11. (That is: the Director had
established that he had (1) caused an inquiry to be made into the matter pursuant to s. 10 and
(2) the person against whom the order was directed has information relevant to that inquiry.)
The question of whether the Director had reasonable grounds to cause an inquiry to be made
did not appear to the court “to be the subject of any reconsideration” and that question was
not before the court.
Raimondo v. Canada (Director of Investigation and Research) (1995), 61 C.P.R. (3d) 142
(Ont. Gen. Div.) — Raimondo sought to have a s. 11 order set aside or varied on the basis
that: the court that issued the order did not have jurisdiction over a respondent domiciled and
resident in Quebec; the order lacked specificity; certain records and documents sought by the
Director were not maintained by Raimondo; and the Director failed to make full and fair
disclosure of all material facts when applying for the order. The application was dismissed.
The court held that subs. 11(4) provides that a s. 11 order granted by an Ontario court judge
would have effect throughout Canada, including Quebec. As it was an ex parte application to
which Raimondo was not party, it should not matter where in Canada the order is issued. On
the issue of specificity, it was appropriate to issue a clarifying order but Raimondo may “be
satisfied with the Director’s written advice” clarifying the matter. The concerns about not
having certain documents were groundless: there was no liability if material was not availa-
ble. Given the ex parte nature of the application, no role for the recipient of an order is
contemplated and no supporting materials or notice had to be given. The court referred to its
decision in Canadian Pacific Ltd. v. Canada (Director of Investigation & Research) (1995),
61 C.P.R. (3d) 137 (Ont. Gen. Div.) for further discussion regarding procedural fairness and
the issue of full and fair disclosure. Raimondo also sought an order unsealing application
materials filed in support of the order. Since no role is contemplated for the recipient of an ex
parte s. 11 order, the court held that there is no purpose to giving Raimondo the material.
24
The court also observed that this should be contrasted with the mischief in which such dis-
closure may result if the Director would have to advise of his position and information re-
lated to that person.
Samson v. R., (sub nom. Samson v. Canada) [1995] 3 F.C. 306, 64 C.P.R. (3d) 417, 131
D.L.R. (4th) 360, 102 F.T.R. 239 (note), 181 N.R. 89 (C.A.); leave to appeal to S.C.C. re-
fused (1996), 65 C.P.R. (3d) vi (note), (sub nom. Samson v. Canada) 132 D.L.R. (4th) vii
Act
(note) (S.C.C.) — In an inquiry initiated pursuant to s. 10 of the Act, the Director sought an
order to compel testimony pursuant to s. 11. The affidavit of the Director disclosed evidence
of price-fixing among notaries. At trial — see [1994] 3 F.C. 113, 55 C.P.R. (3d) 19, 77
F.T.R. 179 (T.D.) — the judge quashed the order on the grounds that it violated s. 7 of the
Charter since the Director already had clear evidence of the offence. The trial judge rea-
soned that the only impact of the order would be to compel testimony from the suspects
against themselves.
This trial judgment was reversed on appeal since more than mere evidence of an agreement
to fix prices must be proved. The prosecution must also establish that the agreement was
“undue” within the meaning of the Supreme Court of Canada judgment in R. v. Nova Scotia
Pharmaceutical Society, [1992] 2 S.C.R. 606, 43 C.P.R. (3d) 1, 93 D.L.R. (4th) 36. The
prosecution did not have sufficient evidence to make the analysis required by Pharmaceuti-
cals and therefore the inquiry at which the respondents were summoned to testify could not
be characterized as one simply designed to incriminate them.
(Competition Trib.) — The combined effect of ss. 11, 19 (claims of solicitor-client privilege)
and 29 (confidentiality requirements) is that documentation not protected by s. 19 can be
used by the Director in launching an application under the Act.
Thomson Newspapers Ltd. v. Canada (Director of Investigation & Research), [1990] 1
S.C.R. 425, 54 C.C.C. (3d) 417, 29 C.P.R. (3d) 97, 67 D.L.R. (4th) 161 (S.C.C.) — The
power conferred by s. 17 [now s. 11] of the Act to compel any person to give oral testimony
constitutes a deprivation of liberty but such compulsion does not violate the principles of
fundamental justice set out in s. 7 of the Charter. The right of an accused or a suspect to
remain silent does not extend to those who are ordered to testify in a proceeding such as that
provided by s. 17 [now s. 11] of the Act. The power to compel testimony is important to the
overall effectiveness of the investigatory machinery established by the Act. An absolute right
to refuse to answer questions in an inquiry would represent a dangerous and unnecessary
imbalance between the rights of the individual and the community’s legitimate interest in
discovering the truth about the existence of practices against which the Act was designed to
protect the public. The right to prevent the subsequent use of compelled self-incriminating
testimony protects an individual without denying an investigator’s access to relevant infor-
mation. The use of derivative evidence obtained as a result of the s. 17 [now s. 11] power
would not generally affect the fairness of a trial since such evidence can be found indepen-
dently of the compelled testimony. If the evidence would not have been found or appreciated
apart from such compelled testimony, it should be excluded under s. 24(2) of the Charter.
An order to produce documents under s. 17 [now s. 11] is a seizure within the meaning of s.
8 of the Charter but such a seizure is not unreasonable, taking into account a number of
factors: the Act serves important socio-economic interests; a discovery mechanism is neces-
sary to the regulatory objective of the legislation; a subpoena is significantly less intrusive
than other alternatives; the privacy interest of corporations in economic information is rela-
tively low; and there is a mechanism for judicial review.
25
Stelco Inc. v. Canada (Attorney General), [1990] 1 S.C.R. 617, 36 F.T.R. 80 (note), 55
C.C.C. (3d) 227, 30 C.P.R. (3d) 1, 108 N.R. 161, 68 D.L.R. (4th) 518 (S.C.C.) — See the
summary under Thomson Newspapers Ltd. v. Canada (Director of Investigation & Re-
search), [1990] 1 S.C.R. 425, 54 C.C.C. (3d) 417, 29 C.P.R. (3d) 97, 67 D.L.R. (4th) 161
(S.C.C.).
Irvine v. Canada (Restrictive Trade Practices Comm.), [1987] 1 S.C.R. 181, 15 C.P.R. (3d)
289, 41 D.L.R. (4th) 429; affirming [1982] 2 F.C. 500, 62 C.P.R. 1, 132 D.L.R. (3d) 323
(C.A.); which reversed [1982] 1 F.C. 72, 56 C.P.R. (2d) 83 (F.C.T.D.) — An inquiry will not
be quashed because the Director fails to disclose to those being examined under s. 17 or
investigated under s. 8 [now s. 10] the Director’s reason for belief that one or more of the
conditions in para. 8(b) [now para. 10(b)] exists.
Samuel, Son & Co. v. Canada (Restrictive Trade Practices Comm.) (1987), [1988] 2 F.C.
523, 21 C.P.R. (3d) 84, 48 D.L.R. (4th) 77 (F.C.T.D.) — A decision to issue a s. 17 [now s.
11] order is reviewable to ensure compliance with rules of fairness or fundamental justice,
but fairness does not require that the material filed in support of the issuance of the order be
automatically disclosed. Where the applicants have suffered no prejudice the court should
not exercise its discretion to order such disclosure. It would nevertheless appear that, in an
inquiry under the Competition Act, the applicants would be entitled to such disclosure given
the prior authorization procedure established in s. 10.
Transpacific Tours Ltd. (CP Air Holidays) v. Dir. of Investigation and Research (1986), 8
C.P.R. (3d) 325, 24 C.C.C. (3d) 103, 25 D.L.R. (4th) 202 (S.C.) — The Charter deals specif-
ically with compellability and self-incrimination in ss. 11(c) and 13. The rights granted by
these sections are not extended by s. 7 of the Charter. Section 7 does not revive the common
law privilege against self-incrimination which was abolished by statute in Canada in 1893 by
the forerunner of s. 5 of the Canada Evidence Act, R.S.C. 1970, c. E-10, and replaced with a
limited protection against self-incrimination. Sections 17 and 20(2) [now s. 11] of the Act
exemplify the same form of limited protection against self-incrimination, and are accord-
ingly valid and not contrary to s. 7 of the Charter.
Dir. of Investigation and Research v. Restrictive Trade Practices Comm. (1985), 4 C.P.R.
(2d) 59, 20 C.C.C. (3d) 476, 18 D.L.R. (4th) 750 (Fed. C.A.) — There is no limitation based
on privacy on the documents which must be produced under this section. It is necessary only
that the documents be relevant to the inquiry and not subject to privilege.
Couture v. Hewison (1983), 71 C.P.R. (2d) 189, 3 C.C.C. (3d) 52, 145 D.L.R. (3d) 55
(C.A.) — Fishermen are workmen within the meaning of para. 4(1)(a) and accordingly may
not be compelled to testify under s. 17(1) [now s. 11(1)] at an inquiry under the Act concern-
ing activities covered by para. 4(1)(a).
R.L. Crain Inc. v. Couture (1983), 10 C.C.C. (3d) 119, 6 D.L.R. (4th) 478, 30 Sask. R. 191
(Q.B.) — The grounds for commencing an inquiry under the Act are all predicated on a
suspicion of wrongdoing formed by the Director. There is no requirement that the Director
disclose the grounds for his suspicion or the identity of the persons suspected, or even that
the suspicion be reasonable. Section 17 [now s. 11] can be invoked to compel a person who
may be a suspect to answer questions at the inquiry without any requirement that the person
be advised of any allegations against her or him, and the evidence so given may form the
basis for a subsequent criminal prosecution. Section 17 [now s. 11] therefore authorizes the
arbitrary compelling of a person to assist in her or his own prosecution. The public interest in
orderly competition is not so compelling as to override this serious interference with the
right to liberty and security guaranteed by s. 7 of the Charter. The protection given in subs.
20(2) [now subs. 11(3)] and s. 13 of the Charter against subsequent use of self-incriminating
26
Part II — Administration (ss. 7–29.2) S. 12(4)(b)
evidence is not adequate where the witness is compelled to assist in an investigation of her or
his own misconduct. Section 17 [now s. 11] accordingly is inconsistent with the rights se-
cured by s. 7 of the Charter, and is not saved by s. 1 of the Charter, and is of no force or
effect.
Ziegler v. Hunter (1983), 81 C.P.R. (2d) 1, 8 D.L.R. (4th) 648; leave to appeal to S.C.C.
refused 81 C.P.R. (2d) 1, 8 D.L.R. (4th) 648n (S.C.C.). — Subsection 20(2) [now subs.
Act
11(3)] does not provide protection against self-incrimination by the compelled production of
documents and by derivative evidence. The protection against self-incrimination guaranteed
by s. 2(d) of the Canadian Bill of Rights, R.S.C. 1970, App. III, does not extend to the
enforced production of documents.
McManus v. Canada (Atomic Energy Control Board), [1980] 2 F.C. 278, 49 C.P.R. (2d) 1,
35 N.R. 152 (Fed. C.A.) — A disclosure to a Commissioner pursuant to s. 17 [now s. 11] is a
disclosure to the Director and thus to a department or agency of the Government of Canada,
since the Director is appointed under the Act which is administered by the Department of
Consumer and Corporate Affairs. Witnesses called under this section must therefore answer
questions concerning information obtained by the Atomic Energy Board, despite s. 26 of the
Atomic Energy Control Regulations, SOR/74-334, and despite any oath of secrecy taken by
the person questioned.
12. (1) Witness competent and compellable — Any person summoned

to attend pursuant to paragraph 11(1)(a) is competent and may be compelled
to give evidence.
(2) Fees — Every person summoned to attend pursuant to paragraph
11(1)(a) is entitled to the like fees and allowances for so doing as if summoned
to attend before a superior court of the province in which the person is sum-
moned to attend.
(3) Representation by counsel — A presiding officer shall permit a per-
son who is being examined pursuant to an order under paragraph 11(1)(a) and
any person whose conduct is being inquired into to be represented by counsel.
(4) Attendance of person whose conduct is being inquired into —
Any person whose conduct is being inquired into at an examination pursuant
to an order under paragraph 11(1)(a) and that person’s counsel are entitled to
attend the examination unless the Commissioner or the authorized representa-
tive of the Commissioner, or the person being examined or his employer, es-
tablishes to the satisfaction of the presiding officer that the presence of the
person whose conduct is being inquired into would
(a) be prejudicial to the effective conduct of the examination or the in-
quiry; or
(b) result in the disclosure of confidential commercial information that
relates to the business of the person being examined or his employer.
R.S.C. 1985, c. 19 (2nd Supp.), s. 24; 1999, c. 2, s. 37(e)
27
Commentary
Subsection 12(3) allows both persons who are being examined and persons “whose conduct
is being inquired into” to be represented by counsel at a s. 11 examination. Together with s.
12(4), this provides an opportunity for counsel for the corporate target of an investigation to
attend examinations of employees, former employees and other third parties. In practice,
counsel who are permitted to attend also receive copies of transcripts of examinations.
However, the right to attend is not absolute: s. 12(4) allows the presiding officer to exclude
the person whose conduct is being inquired into, and that person’s counsel, where the Com-
missioner or the person being examined, or that person’s employer, establishes that the pres-
ence of the subject of the inquiry would be prejudicial to the effective conduct of the exami-
nation or result in the disclosure of confidential commercial information. This must be
established on a balance of probabilities. While the statute does not explicitly say so, presid-
ing officers have determined that if a person is to be excluded from the examination under s.
12(4), that person’s counsel must be excluded as well. Counsel in this situation sometimes
offer to sign “counsels’ eyes only” confidentiality undertakings or ask that the presiding
officer make such an order, but these offers have been rejected by presiding officers on the
basis that they have no power to impose such an order.
Case Law
Commissioner of Competition v. Bauer Performance Sports Ltd., Court File No. T-1354-13,
Commissioner of Competition v. Sport Maska Inc., Court File No. T-1365-13, Commissioner
of Competition v. Easton Sports Canada, Inc., Court File No. T-1371-13 (2013), (Presiding
Officer, unreported) — In the context of the review of the proposed merger of hockey goods
retailers Forzani Group Limited (“FGL”) and Pro Hockey Life, the Commissioner of Com-
petition obtained s. 11 orders requiring three suppliers to give evidence about their plans for
expansion into the retail market and the features of supply agreements with the retailers’
competitors, among other things. All three suppliers provided affidavits in support of the
Commissioner’s motions to exclude FGL’s attendance at the examinations. The presiding
officer found that there was no evidence to establish under s. 12(4)(a) that FGL’s attendance
at the examinations would be prejudicial to the conduct of the inquiry. However, the evi-
dence allowed her to conclude under s. 12(4)(b) that confidential commercial information
would be disclosed during the examinations, and FGL was excluded on that basis. FGL’s
counsel was excluded as well. The presiding officer rejected the offer by FGL’s counsel to
sign a confidentiality undertaking for two reasons. First, she had no authority to impose such
an order. Second, she found that the Act should not be interpreted in a way that denies access
to the person whose conduct is being inquired into, but nevertheless permits the person to
benefit by permitting their counsel to receive the information. Counsel cannot have more
rights than the party being represented.
Commissioner of Competition v. Vidéotron Télécom Ltée and Sylvain Gelina (2003), Federal
Court File No. T-556-03 (Presiding Officer; unreported) — Investigation into possible collu-
sion among landlords in relation to prices charged to telecommunication service providers
for access to the landlords’ buildings. Section 11 orders were issued against various telecom
companies, most of whom brought applications under s. 12, supported by the Commissioner
of Competition, for the landlords to be excluded from the examinations. As in Cast, counsel
for the targets of the investigation offered to give undertakings to keep the information confi-
dential. The presiding officer found that his limited authority did not include the enforcement
of undertakings. In deciding whether to make an order under s. 12(4), the presiding officer is
entitled to consider factual matters which are common ground among counsel, the nature of
the inquiry undertaken by the Commissioner, and the affidavit evidence presented to the
28
presiding officer. Once one of the grounds in s. 12(4) is established, the entitlement to attend
the examination is removed. Here, affidavit evidence from representatives of Telus and
Vidéotron established that confidential information would be disclosed, and that those two
companies feared retaliation from the landlords for their participation in the inquiry. The
presiding officer ruled that the landlords and their counsel were excluded from those exami-
nations, but because none of the other telecoms had filed affidavit evidence, there was no
Act
basis to extend the ruling to them.
(1997), 136 F.T.R. 16, 78 C.P.R. (3d) 221, 4 Admin. L.R. (3d) 123 (T.D.) — In an inquiry
respecting an alleged conspiracy among van lines, the presiding officer concluded that the
presence of the van lines at any examination other than their own would be prejudicial to the
effective conduct of the examination and prejudicial to the inquiry itself. Accordingly, an
order for exclusion was made under s. 14(2) of the Act pursuant to s. 12(4)(a) and (b). The
excluded parties were unsuccessful in quashing the order of the presiding officer. Pursuant to
s. 12(3), the presiding officer is required to permit both a person whose conduct is under
inquiry and the witness to be represented by counsel. Once any of the grounds for exclusion
are established, then the affected person and that person’s counsel are not entitled to attend
the examination of any other person. A presiding officer’s decision must be reviewed in the
proper context, having regard to the fact that the examinations are investigative, not adver-
sarial, in nature, that no substantive rights of the persons under inquiry will be determined,
and that all of what occurs at the examination will be disclosed later if there are subsequent
proceedings. Any counsel who does attend the examination must play a limited role, with no
right to call evidence, to cross-examine, or to object to questions. At most, a limited right to
re-examination for clarification may exist.
Canada (Director of Investigation & Research) v. Cast Group Ltd. (1995), 61 C.P.R. (3d)
219 (Competition Trib.) (Presiding Officer) — Section 12 of the Competition Act applies in
the context of a merger review and permits acquirors to attend examinations. In this case, CP
Containers (Bermuda) Limited proposed the acquisition of the shares and assets of The Cast
Group Limited. The Director obtained a s. 11 order requiring attendance of a Cast represen-
tative. CP’s counsel attempted to attend the examination; counsel for the Director objected
on the basis that there was no right under s. 12 for an acquiror to attend (since it was not a
person “whose conduct is being inquired into”) and in any event the criteria for exclusion
under s. 12(4)(a) or (b) had been established. The presiding officer determined that a merger
does involve “conduct” and therefore CP’s counsel could be permitted to attend the exami-
nation. However, in this case, the s. 12(4) criteria were established and CP’s counsel was
excluded. While s. 12(4) only refers to excluding the person whose conduct is being inquired
into, and not their counsel, this is not a reasonable interpretation of the statute. The right of
counsel to attend is linked to the right of the client. While counsel for CP had offered to
provide an undertaking to keep the matters discussed confidential, this approach was not in
keeping with the statutory provisions. Based on information provided in camera by the Bu-
reau’s case officers, there was sufficient evidence to establish the presence of CP’s counsel
would prejudice the inquiry, and that confidential commercial information would be re-
vealed. CP’s counsel was excluded.
289, 34 C.C.C. (3d) 481, (sub nom. Restrictive Trade Practices Comm. v. Irvine) 74 N.R. 33,
(sub nom. Re Irving and Restrictive Trade Practices Comm.) 41 D.L.R. (4th) 429 — Neither
the Act nor the doctrine of fairness provides the appellants with a right to cross-examine
witnesses at the inquiry. Fairness is a flexible concept whose content varies depending on the
nature of the inquiry and the consequences for the individuals involved. The extent of the
29
right to counsel and the role of counsel, where counsel are authorized by statute, are deter-
mined by the characteristics of the proceeding, the nature of the resulting report and its circu-
lation to the public, and the penalties which will result when events succeeding the report are
put in train. The investigating body must control its own procedure. When the body has
determinative powers, however, different considerations enter the process.
Transpacific Tours Ltd. (CP Air Holidays) v. Dir. of Investigation and Research (1986), 8
C.P.R. (3d) 325, 24 C.C.C. (3d) 103, 25 D.L.R. (4th) 202 (S.C.) — See entry under s. 11.
R.L. Crain Inc. v. Couture (1983), 10 C.C.C. (3d) 119, 6 D.L.R. (4th) 478, 30 Sask. R. 191
(Q.B.) — See entry under s. 11.
13. (1) Presiding officer — Any person may be designated as a presiding

officer who is a barrister or advocate of at least ten years standing at the bar
of a province or who has been a barrister or advocate at the bar of a province
for at least ten years.
(2) Remuneration and expenses — A presiding officer shall be paid
such remuneration, and is entitled to be paid such travel and living expenses,
and such other expenses, incurred in the performance of his duties under this
Act, as may be fixed by the Governor in Council.
R.S.C. 1985, c. 19 (2nd Supp.), s. 24
14. (1) Administration of oaths — The presiding officer may administer

oaths and take and receive solemn affirmations for the purposes of examina-
tions pursuant to paragraph 11(1)(a).
(2) Orders of presiding officer — A presiding officer may make such or-
ders as he considers to be proper for the conduct of an examination pursuant
to paragraph 11(1)(a).
(3) Application to court — A judge of a superior or county court may, on
application by a presiding officer, order any person to comply with an order
made by the presiding officer under subsection (2).
(4) Notice — No order may be made under subsection (3) unless the presid-
ing officer has given to the person in respect of whom the order is sought and
the Commissioner twenty-four hours notice of the hearing of the application
for the order or such shorter notice as the judge to whom the application is
made considers reasonable.
R.S.C. 1985, c. 19 (2nd Supp.), s. 24; 1999, c. 2, s. 37(f); 2002, c. 8, s. 127
Commentary
While it is improbable that the wide discretion given to the presiding officer violates any
section of the Charter, it should be noted that individual orders made by him, depending on
their content, could be held to be conduct which violates the Charter.
Case Law
(1997), 136 F.T.R. 16, 78 C.P.R. (3d) 221, 4 Admin. L.R. (3d) 123 (F.C.T.D.) — In an in-
30
Part II — Administration (ss. 7–29.2) S. 15(1)(d)
quiry respecting an alleged conspiracy, the presiding officer was entitled to exclude parties
and their counsel at any examination of their own where their presence would be prejudicial
to the effective conduct of the examination and prejudicial to the inquiry itself and would
result in disclosure of confidential/commercial information.
Subsection (2)
Act
289 — See entry under s. 12.
14.1 (1) Application of Criminal Code — preservation demand and

orders for preservation or production of data — Sections 487.012,
487.013, 487.015, 487.016 and 487.018 of the Criminal Code, which apply to the
investigation of offences under any Act of Parliament, also apply, with any
modifications that the circumstances require,
(a) to an investigation in relation to a contravention of an order made
under section 32, 33 or 34 or Part VII.1 or VIII; or
(b) to an investigation in relation to whether grounds exist for the making
of an order under Part VII.1 or VIII.
(2) Clarification — The provisions of the Criminal Code referred to in sub-
section (1) apply whether or not an inquiry has been commenced under section
10.
2014, c. 31, s. 29
15. (1) Warrant for entry of premises — If, on the ex parte application of
the Commissioner or his or her authorized representative, a judge of a supe-
rior or county court is satisfied by information on oath or solemn affirmation
(a) that there are reasonable grounds to believe that
(i) a person has contravened an order made pursuant to section 32,
33 or 34, or Part VII.1 or VIII,
(ii) grounds exist for the making of an order under Part VII.1 or
VIII, or
(iii) an offence under Part VI or VII has been or is about to be com-
mitted, and
(b) that there are reasonable grounds to believe that there is, on any
premises, any record or other thing that will afford evidence with respect
to the circumstances referred to in subparagraph (a)(i), (ii) or (iii), as the
case may be,
the judge may issue a warrant under his hand authorizing the Commissioner
or any other person named in the warrant to
(c) enter the premises, subject to such conditions as may be specified in
the warrant, and
(d) search the premises for any such record or other thing and copy it or
seize it for examination or copying.
31
(2) Contents of warrant — A warrant issued under this section shall iden-
tify the matter in respect of which it is issued, the premises to be searched and
the record or other thing, or the class of records or other things, to be
searched for.
(3) Execution of search warrant — A warrant issued under this section
shall be executed between six o’clock in the forenoon and nine o’clock in the
afternoon, unless the judge issuing it, by the warrant, authorizes execution of
it at another time.
(4) Idem — A warrant issued under this section may be executed anywhere in
Canada.
(5) Duty of persons in control of premises — Every person who is in
possession or control of any premises or record or other thing in respect of
which a warrant is issued under subsection (1) shall, on presentation of the
warrant, permit the Commissioner or other person named in the warrant to
enter the premises, search the premises and examine the record or other thing
and to copy it or seize it.
(6) Where admission or access refused — Where the Commissioner
or any other person, in executing a warrant issued under subsection (1), is
refused access to any premises, record or other thing or where the Commis-
sioner believes on reasonable grounds that access will be refused, the judge
who issued the warrant or a judge of the same court, on the ex parte applica-
tion of the Commissioner, may by order direct a peace officer to take such
steps as the judge considers necessary to give the Commissioner or other per-
son access.
(7) Where warrant not necessary — The Commissioner or the author-
ized representative of the Commissioner may exercise any of the powers set
out in paragraph (1)(c) or (d) without a warrant if the conditions set out in
paragraphs (1)(a) and (b) exist but by reason of exigent circumstances it would
not be practical to obtain the warrant.
(8) Exigent circumstances — For the purposes of subsection (7), exigent
circumstances include circumstances in which the delay necessary to obtain a
warrant under subsection (1) would result in the loss or destruction of
evidence.
R.S.C. 1985, c. 19 (2nd Supp.), s. 24; 1999, c. 2, ss. 8, 37(g); 2002, c. 8, s. 128
Commentary
Section 15 outlines the Commissioner’s powers of search and seizure. It allows Competition
Bureau staff to carry out searches of business and residential premises with prior judicial
authorization. Searches are normally carried out by authorized Bureau peace officers, some-
times accompanied by police officers.
Subsection 15(1) allows for the issuance of a warrant where the Commissioner believes that
an offence “is about to be committed” as well as in circumstances in which the Commis-
32
sioner believes that an offence has been committed. Although subsection 15(1) contemplates
the use of search warrants in civil reviewable practice cases, searches are normally carried
out only where the Bureau suspects that an offence has been committed. Even in serious
criminal cases, the Bureau sometimes gathers information voluntarily or by means of section
11 orders.
The Bureau is not required to wait for legal advisors to arrive before commencing a search,
Act
but will typically give legal advisors a short but reasonable amount of time to arrive.
Subsection 19(2) of the Act sets out a special procedure for dealing with documents that may
be subject to a claim of privilege. Such documents cannot be immediately seized by officers
under a search warrant. They must be sealed pending an assessment of the validity of the
privilege claim within a limited time.
In a particular case it may also be relevant to consider the extensive body of jurisprudence
under section 8 of the Charter of Rights and Freedoms, which provides that everyone has the
right to be secure against unreasonable search and seizure.
See generally Information Bulletin on Sections 15 and 16 of the Competition Act (Ottawa:
Competition Bureau, April 2008).
Section 183 of the Criminal Code also permits the Competition Bureau to apply for authori-
zation to intercept private communications with or without the consent of a party to the
communication. Interception of private communications without consent may only occur in
order to investigate: (1) conspiracy (s. 45); (2) bid-rigging (s. 47); and (3) deceptive
telemarketing (s. 52.1(3)). See generally Information Bulletin on Interception of Private
Communications and the Competition Act (Ottawa: Competition Bureau, September 1999).
Case Law
Canada (Commissioner of Competition) v. Cascades Fine Papers Group Inc., 2004 FC 95
(F.C.) — The Commissioner obtained warrants authorizing his representatives to enter and
search various premises of the respondents as well as a sealing order pursuant to s. 487.3 of
the Criminal Code. The respondents sought access to the Information and an adjustment to
the sealing order to enable them to assert their s. 8 Charter rights against unreasonable
search and seizure. The respondents acknowledged the importance of protecting confidential
informants but thought that any such party could be protected by redacting the Information
in an appropriate manner. The motion was allowed. Once a search warrant is executed and
something has been seized pursuant to that search warrant, the warrant and the information
to obtain the warrant are available to the public unless a party seeking a sealing order can
demonstrate that public access would subvert the ends of justice: MacIntyre v. Nova Scotia
(Attorney General) (1982), 65 C.C.C. (2d) 129 (S.C.C.) at 149. See also Toronto Star
Newspapers Ltd. v. Ontario, 2003 CarswellOnt 3986 (Ont. C.A.); leave to appeal allowed
2004 CarswellOnt 1762 (S.C.C.); affirmed 2005 CarswellOnt 2613, 2005 CarswellOnt 2614
(S.C.C.). Information that could identify a confidential informant is properly excluded from
the public domain. The issue before the court was the extent to which the Information should
be redacted in order to protect confidential informants. In editing the contents of an Informa-
tion to avoid disclosure of the identity of a confidential informant, a court should proceed
with caution. If there is any doubt as to whether disclosure would reveal that identity, disclo-
sure should not be made. In some cases, blanket non-disclosure is required, since it cannot be
said with any confidence that disclosure of any kind would not run the risk of revealing the
identity of the informant: R. v. Leipert (1997), 112 C.C.C. (3d) 385 (S.C.C.). With those
guidelines in mind, and considering the specific criteria referred to in s. 487.3 of the Crimi-
33
nal Code, the court held that the Information could be made part of the public record pro-
vided certain deletions were made.
United States Pipe & Founding Co., Re (1994), 58 C.P.R. (3d) 463 (Ont. Gen. Div.) — Two
search warrants were granted under the Act and a sealing order was obtained in order to
prevent the information contained in the application from shaping the testimony of witnesses
in a grand jury investigation in the United States. An application by the party affected by the
search warrant for production of all documentation filed in support of the warrants was al-
lowed. There was a presumption in favour of public access and the evidence did not disclose
a reasonable likelihood that the information in question would affect the testimony of wit-
nesses at the grand jury investigation. Furthermore, it was possible to protect the identity of
the informants by editing the information. It had not been established that granting access to
the information under seal would subvert the ends of justice.
Hudson’s Bay Co. v. Canada (Director of Investigation & Research) (1992), 10 O.R. (3d)
89, 42 C.P.R. (3d) 448, 58 O.A.C. 7 (C.A.); affirming (1992), 9 O.R. (3d) 51, 42 C.P.R. (3d)
435 (Gen. Div.); leave to appeal to S.C.C. refused (1993), 15 O.R. (3d) xvi (note), 50 C.P.R.
(3d) v (note), 163 N.R. 79 (note) (S.C.C.) — In the absence of a provision in the Act al-
lowing for the right to appeal the issuance of an ex parte search warrant under s. 15, no such
right exists.
Canada (Dir. of Investigation & Research) v. NutraSweet Co. (1990), 32 C.P.R. (3d) 1
(Comp. Trib.) — The Competition Tribunal is validly constituted and not constitutionally
invalid. There is no constitutional requirement that lay members of such a Tribunal be
granted the same security of tenure as judicial members, and there is adequate protection
against bias in the legislation. Nor does concurrent membership of such members on the
Restrictive Trade Practices Commission result in bias. Furthermore, nothing in the Constitu-
tion precludes persons with specialized knowledge other than law from sitting on tribunals.
Dir. of Investigation & Research v. Irving Equipment, a division of J.D. Irving Ltd. (1986),
[1988] 1 F.C. 27, (sub nom. Canada (Dir. of Investigation & Research) v. Irving Equipment)
8 F.T.R. 107, 33 C.C.C. (3d) 447, 16 C.P.R. (3d) 26 (F.C.T.D.) — The respondent applied
for an order that all copies of the Information filed in support of the granting of a search
warrant under this section be maintained as confidential. Revelation of the information
would not violate the respondent’s right to fundamental justice (s. 7 of the Charter) nor
render the search unreasonable (s. 8 of the Charter). Nor was para. 11(d) of the Charter
applicable as no charge had yet been laid. The common law was of more assistance to the
respondents. Until the Director has established that something cogent has been seized justi-
fying a charge — for which he has 60 days under subs. 18(4) — no valid public interest
would be served by giving the public access to the respondent’s business secrets. The infor-
mation was accordingly ordered to be kept confidential with access limited to the parties and
court officials unless the respondents were charged under the Act or consented to release of
the information to the public. See also entry under s. 17.
N.S. Pharmaceutical Society v. Canada (1988), 21 C.P.R. (3d) 550 (N.S. T.D.) — Copies of
documents seized under an invalid warrant issued under s. 10 of the Combines Investigation
Act, R.S.C. 1970, c. C-23, which was found to be unconstitutional, were ordered returned to
the court pending execution of new warrants under s. 15. The Crown had a right to such
warrants and there was no reason to stay their issuance.
603022 Ont. Inc. v. Canada (Dir. of Investigation & Research, Competition Act) (1988), 21
C.P.R. (3d) 575 (Ont. H.C.) — The Court should not exercise its inherent jurisdiction to
review warrants issued under this section or to order the return of documents seized under
34
Part II — Administration (ss. 7–29.2) S. 16(3)
such warrants. The admissibility of documents seized is an evidentiary matter to be left to

the trial judge.
Clarke Transport Can. Inc., Re (1987), 16 C.P.R. (3d) 173 (Ont. H.C.) — Where it would
jeopardize the investigation, the material filed in support of the issuance of a search warrant
should not be disclosed before the search is completed.
Act
Dir. of Investigation & Research appointed under the Competition Act v. Hoffman-La Roche
Ltd. (1987), (sub nom. Goldman v. Hoffman-La Roche Ltd.) 60 O.R. (2d) 161, 16 C.P.R. (3d)
289, 35 C.C.C. (3d) 488, 22 O.A.C. 85, 42 D.L.R. (4th) 436 (C.A.) — The offences under ss.
50 and 52 of the Act are criminal in nature and depend on s. 91(27) of the Constitution Act,
1867, for their enactment and not solely on the trade and commerce power (s. 91(2)). Ac-
cordingly, there is no appeal from the issuance of a search warrant under s. 15 as none is
provided for in the Criminal Code.
Canada (Dir. of Investigation & Research under the Competition Act) v. Calgary Real
Estate Bd. Co-op Ltd., [1987] 3 F.C. 676, 13 F.T.R. 303, 16 C.P.R. (3d) 529 (T.D.) — An
adverse party has no prima facie right to cross-examine an informant on an affidavit submit-
ted in support of an application for a search warrant following the execution of the warrant
but prior to the commencement of any other proceedings. In the absence of any specific
grounds for challenging the information, cross-examination at this early stage would be
merely a fishing expedition and no useful purpose would be served. Denial of the right to a
cross-examination causes no substantial injustice.
Dir. of Investigation & Research under the Competition Act v. Irving Equipment, a division
of J.D. Irving Ltd. (1986), 12 C.P.R. (3d) 137, (sub nom. Dir. of Investigation & Research
(Competition Act) v. Irving Equipment) 8 F.T.R. 23 (F.C.T.D.) — The reasonable grounds
required for the issuance of a search warrant provide only the threshold to the matters in
issue. They do not provide proof beyond a reasonable doubt unless they remain totally unan-
swered in subsequent proceedings. The presumption of innocence is not diluted.
16. (1) Operation of computer system — A person who is authorized

pursuant to subsection 15(1) to search premises for a record may use or cause
to be used any computer system on the premises to search any data contained
in or available to the computer system, may reproduce the record or cause it
to be reproduced from the data in the form of a printout or other intelligible
output and may seize the printout or other output for examination or copying.
(2) Duty of person in control of computer system — Every person
who is in possession or control of any premises in respect of which a warrant is
issued under subsection 15(1) shall, on presentation of the warrant, permit any
person named in the warrant to use or cause to be used any computer system
or part thereof on the premises to search any data contained in or available to
the computer system for data from which a record that that person is author-
ized to search for may be produced, to obtain a physical copy thereof and to
seize it.
(3) Order restricting operation of computer system — A judge who
issued a warrant under subsection 15(1) or a judge of the same court may, on
application by the Commissioner or any person who is in possession or control
35
of a computer system or a part thereof on any premises in respect of which the

warrant was issued, make an order
(a) specifying the individuals who may operate the computer system and
fixing the times when they may do so; and
(b) setting out any other terms and conditions on which the computer sys-
tem may be operated.
(4) Notice by person in possession or control — No order may be
made under subsection (3) on application by a person who is in possession or
control of a computer system or part thereof unless that person has given the
Commissioner twenty-four hours notice of the hearing of the application or
such shorter notice as the judge considers reasonable.
(5) Notice by Commissioner — No order may be made under subsection
(3) on application by the Commissioner after a search has begun of the prem-
ises in respect of which the order is sought unless the Commissioner has given
the person who is in possession or control of the premises twenty-four hours
notice of the hearing of the application or such shorter notice as the judge
considers reasonable.
(6) [Repealed 2010, c. 23, s. 71.]
R.S.C. 1985, c. 19 (2nd Supp.), s. 24; 1999, c. 2, s. 37(h); 2010, c. 23, s. 71
Commentary
Section 16 provides that a person authorized to search premises pursuant to subsection 15(1)
may also search computer systems for records described in the search warrant. As the section
allows the Commissioner to access any data “available to the computer system”, Competi-
tion Bureau staff can and do search Canadian computers for data stored outside of Canada.
See generally Information Bulletin on Sections 15 and 16 of the Competition Act (Ottawa:
Competition Bureau, April 2008).
Case Law
United States Pipe & Founding Co., Re (1994), 58 C.P.R. (3d) 463 (Ont. Gen. Div.) —
Software brought onto the premises from outside can be used in the course of a search of a
company’s computer system by those doing the search. The Act authorizes a search of a
computer system on the premises and does not preclude the use of such tools as are needed
to assist in carrying out such a search.
17. (1) Presentation of or report on record or thing seized — Where

a record or other thing is seized pursuant to paragraph 15(1)(d), subsection
15(7) or section 16, the Commissioner or the authorized representative of the
Commissioner shall, as soon as practicable,
(a) take the record or other thing before the judge who issued the warrant
or a judge of the same court or, if no warrant was issued, before a judge
of a superior or county court; or
36
(b) make a report in respect of the record or other thing to a judge deter-
mined in accordance with paragraph (a).
(2) Report — A report to a judge under paragraph (1)(b) in respect of a re-
cord or other thing shall include
(a) a statement as to whether the record or other thing was seized pursu-
Act
ant to paragraph 15(1)(d), subsection 15(7) or section 16;
(b) a description of the premises searched;
(c) a description of the record or other thing seized; and
(d) the location in which it is detained.
(3) Retention or return of thing seized — Where a record or other
thing is seized pursuant to section 15 or 16, the judge before whom it is taken
or to whom a report is made in respect of it pursuant to this section may, if he
is satisfied that the record or other thing is required for an inquiry or any
proceeding under this Act, authorize the Commissioner to retain it.
R.S.C. 1985, c. 19 (2nd Supp.), s. 24; 1999, c. 2, s. 37(i); 2002, c. 8, s. 129
Case Law
Lake Ontario Cement v. Canada (Dir. of Investigation & Research) (1990), 32 C.P.R. (3d)
93, 37 F.T.R. 197 (F.C.T.D.) — Search warrants were issued under the Act on March 14,
1990, permitting a search and seizure of documents concerning matters between May 1,
1976 and July 31, 1988. Two hundred thousand items were seized. The applicant sought and
was granted the return of 17 documents relating to the period after July 31, 1988. Given the
wide latitude allowed by the warrants, any seizure beyond the scope authorized cannot be
justified. The respondent had not even, on any reasonable grounds, related the documents to
the alleged bid rigging offences or to any other offences, nor was any evidence offered to
support the theory that the documents had been in “plain view”.
Northern Pool Express Ltd. v. Canada (Dir. of Investigation & Research appointed under
the Competition Act) (1988), 39 B.L.R. 166, (sub nom. Northern Pool Express Ltd. v. Dir. of
Investigation & Research) 19 C.P.R. (3d) 308, 26 O.A.C. 378 (C.A.); affirming (1987), (sub
nom. Cottrell Transport Inc. v. Dir. of Investigation and Research) 19 C.P.R. (3d) 117 (Ont.
H.C.); leave to appeal to S.C.C. refused (1988), 39 B.L.R. xxxviii (note), 30 O.A.C. 78
(note), 88 N.R. 318 (note) (S.C.C.) — Those from whom items are seized have no right to
appear or be heard if the Director complies with s. 17(1) or (2), although they may have such
a right if the Director applies under s. 17(3) to retain “a record or other thing” which has
been seized. “Record” does not, however, include a photocopy of an item seized and the
Director does not require an order under s. 17(3) to retain such photocopies.
Dir. of Investigation & Research v. Irving Equipment, a division of J.D. Irving Ltd. (1986),
[1988] 1 F.C. 27, (sub nom. Canada (Dir. of Investigation & Research) v. Irving Equipment)
8 F.T.R. 107, 33 C.C.C. (3d) 447, 27 C.R.R. 78, 16 C.P.R. (3d) 26, 39 D.L.R. (4th) 341
(T.D.). See also the entry under s. 15. — The Director made a report to the court concerning
records seized pursuant to a warrant issued under the Act and requested authorization to
retain the items seized pursuant to s. 17(3). As the respondent did not agree to the retention
under s. 18(4), the Director was required to make the case for retention and could retain the
records for only as long as permitted by s. 18(4). The records and information were ordered
37
to be kept confidential with access limited to the parties and court officials unless and until
charges were laid.
Norvinca Inc., Re, [1987] 3 F.C. 365, 12 F.T.R. 1, 16 C.P.R. (3d) 187 (T.D.) — The granting
of an order under s. 17(3) is a judicial, not an administrative, act. The presiding judge does
not review the order granting the warrant but rather verifies the usefulness of the seized
records. This should be done only in the presence of the person whose objects were seized or
after a duly served notice of the application for retention.
18. (1) Commissioner to take reasonable care — Where any record or

other thing is produced pursuant to section 11 or seized pursuant to section 15
or 16, the Commissioner shall take reasonable care to ensure that it is pre-
served until it is returned to the person by whom it was produced or from
whom it was seized or until it is required to be produced in any proceeding
under this Act.
(1.1) Certified copies — The Commissioner need not return any copy of a
record produced under section 11 or obtained under section 15 or 16.
(2) Access to records or things — The person by whom a record or
other thing is produced pursuant to section 11 or from whom a record or
other thing is seized pursuant to section 15 or 16 is entitled, at any reasonable
time and subject to such reasonable conditions as may be imposed by the
Commissioner, to inspect the record or other thing.
(3) Copy of record where returned — The Commissioner may, before
returning any record produced pursuant to section 11 or seized pursuant to
section 15 or 16, make or cause to be made, and may retain, a copy thereof.
(4) Detention of things seized — Any record or other thing that is pro-
duced pursuant to section 11, or the retention of which is authorized under
subsection 17(3), shall be returned to the person by whom it was produced or
the person from whom it was seized not later than sixty days after it was pro-
duced or its retention was authorized, unless, before the expiration of that
period,
(a) the person by whom it was produced or from whom it was seized
agrees to its further detention for a specified period of time;
(b) the judge who authorized its production or retention or a judge of the
same court is satisfied on application that, having regard to the circum-
stances, its further detention for a specified period of time is warranted
and the judge so orders; or
(c) proceedings are instituted in which the record or thing may be
required.
R.S.C. 1985, c. 19 (2nd Supp.), s. 24; 1999, c. 2, s. 37(j); 2002, c. 16, s. 2; 2017, c. 26,
s. 12
38
Part II — Administration (ss. 7–29.2) S. 19(4)
Case Law
Dir. of Investigation & Research v. Irving Equipment, a division of J.D. Irving Ltd., (sub
nom. Canada (Dir. of Investigation & Research) v. Irving Equipment) [1988] 1 F.C. 27, 8
F.T.R. 107, 33 C.C.C. (3d) 447, 16 C.P.R. (3d) 26, 27 C.R.R. 78, 39 D.L.R. (4th) 341
(F.C.T.D.) — See entries under ss. 15 and 17.
Act
Lawson Business Forms (Man.) Ltd., Re (1987), 16 C.P.R. (3d) 167 (Sask. Prov. Ct.) —
Section 11 of the Combines Investigation Act, R.S.C. 1970, c. 23 made copies of documents
admissible in evidence and authorized the Director to have such copies made. Unless the
Director delegates this authority under s. 25 [now s. 27] only he has the authority to order
such copies made. The words “or his authorized representative” are not to be read in.
19. (1) Claim to solicitor-client privilege (section 11) — Where a per-

son is ordered to produce a record pursuant to section 11 and that person
claims that there exists a solicitor-client privilege in respect thereof, the person
shall place it in a package and seal and identify the package and place it in the
custody of a person referred to in subsection (3).
(2) Claim to solicitor-client privilege (section 15 or 16) — Where,
pursuant to section 15 or 16, any person is about to examine, copy or seize or
is in the course of examining, copying or seizing any record and a person ap-
pearing to be in authority claims that there exists a solicitor-client privilege in
respect thereof, the first-mentioned person, unless the person claiming the
privilege withdraws the claim or the first-mentioned person desists from ex-
amining and copying the record and from seizing it or a copy thereof, shall,
without examining or further examining it or making a copy or further copy
thereof, place it and any copies of it made by him, and any notes taken in
respect of it, in a package, and seal and identify the package and place it in the
custody of a person referred to in subsection (3).
(3) Custody of record — A record in respect of which a solicitor-client
privilege is claimed under subsection (1) or (2) shall be placed in the custody of
(a) the registrar, prothonotary or other like officer of a superior or county
court in the province in which the record was ordered to be produced or
in which it was found, or of the Federal Court;
(b) a sheriff of the district or county in which the record was ordered to
be produced or in which it was found; or
(c) some person agreed on between the Commissioner or the authorized
representative of the Commissioner and the person who makes the claim
of privilege.
(4) Determination of claim to privilege — A judge of a superior or
county court in the province in which a record placed in custody under this
section was ordered to be produced or in which it was found, or of the Federal
Court, sitting in camera, may decide the question of solicitor-client privilege in
relation to the record on application made in accordance with the rules of the
court by the Commissioner or the owner of the record or the person in whose
39
possession it was found within thirty days after the day on which the record
was placed in custody if notice of the application has been given by the appli-
cant to all other persons entitled to make application.
(5) Idem — Where no application is made in accordance with subsection (4)
within thirty days after the day on which a record is placed in custody under
this section, any judge referred to in subsection (4) shall, on ex parte applica-
tion by or on behalf of the Commissioner, order the record to be delivered to
the Commissioner.
(6) Authority of judge — A judge referred to in subsection (4) may give
any directions that the judge deems necessary to give effect to this section, may
order delivery up to the judge out of custody of any record in respect of which
he is asked to decide a question of solicitor-client privilege and may inspect
any such record.
(7) Prohibition — Any person who is about to examine, copy or seize any
record pursuant to section 15 or 16 shall not do so without affording a reason-
able opportunity for a claim of solicitor-client privilege to be made under this
section.
(8) Access to record in custody — At any time while a record is in cus-
tody under this section, a judge of a superior or county court in the province
in which the record is in custody, or of the Federal Court, may, on an ex parte
application of a person claiming solicitor-client privilege under this section,
authorize that person to examine the record or make a copy of it in the pres-
ence of the person who has custody of it or the judge, but any such authoriza-
tion shall contain provisions to ensure that the record is repackaged and that
the package is resealed without alteration or damage.
R.S.C. 1985, c. 19 (2nd Supp.), s. 24; 1999, c. 2, s. 37(k)
Commentary
Section 19 provides a legislative scheme for dealing with claims of solicitor-client privilege
made in connection with the production of information pursuant to sections 11, 15 or 16.
Where a claim of solicitor-client privilege is made, the information is to be placed by the
person making the claim into a package, sealed, and placed in the custody of a person
deemed acceptable under subsection 19(3) of the Act. It is up to a judge, upon application, to
decide whether information is subject to solicitor-client privilege.
See generally Information Bulletin on Section 11 of the Competition Act (Ottawa: Competi-
tion Bureau, November 2005) and Information Bulletin on Sections 15 and 16 of the Compe-
tition Act (Ottawa: Competition Bureau, April 2008). On pp. 15-16 of the latter document,
the Bureau states that “issues of privilege have often been resolved without the need to resort
to a formal court process. The Bureau is willing to minimize the need for such a formal,
judicial process to screen privileged from non-privileged records on a case-by-case basis.”
As noted, section 19 relates to solicitor-client privilege. That privilege applies in connection
with communications (1) between a solicitor and a client that (2) involves the giving or
seeking of legal advice (3) where there is an intention that the communication be maintained
in confidence, and confidentiality is maintained. See generally Pritchard v. Ontario (Human
40
Rights Commission), [2004] 1 S.C.R. 809 (S.C.C.); Solosky v. Canada (1979), [1980] 1
S.C.R. 821, 105 D.L.R. (3d) 745 (S.C.C.). Whether a solicitor is an in-house lawyer or
outside lawyer has no bearing on whether a communication is privileged. However, business
communications involving an in-house lawyer acting in an executive capacity are not privi-
leged simply because they involve a lawyer. The lawyer must be giving legal advice.
Although no reported cases have considered the issue, section 19 also likely extends to liti-
Act
gation privilege and other types of privilege by virtue of the decision of the Supreme Court
of Canada in Blank v. Canada (Department of Justice), [2006] 2 S.C.R. 319 (S.C.C.). In
Blank, a majority of the Court held that “solicitor-client privilege” under section 23 of the
Fisheries Act encompassed litigation privilege as a matter of statutory interpretation. This
was because “The [Fisheries] Act was adopted nearly a quarter-century ago. It was not un-
common at the time to treat “solicitor-client privilege” as a compendious phrase that in-
cluded both the legal advice privilege and litigation privilege.” A court would likely take a
similar approach in interpreting section 19.
Unlike solicitor-client privilege, litigation privilege applies to communications of a non-con-
fidential nature between the solicitor and third parties and even includes material of a non-
communicative nature. It also applies only in the context of litigation itself and, in most
instances, ends once the litigation has ended. See also R.J. Sharpe, “Claiming Privilege in
the Discovery Process,” in Law in Transition: Evidence, [1984] Special Lect. L.S.U.C. 163,
at pp. 164-65.
In connection with a merger notification or Supplemental Information Request, a party may
withhold privileged communications pursuant to subsection 116(1). That subsection avoids
uncertainty as to whether it extends to both solicitor-client privilege and litigation privilege
by referring more generally to “the privilege that exists in respect of lawyers and notaries
and their clients.”
Communications relating to criminal matters or intended to facilitate the commission of a
crime are recognised exceptions to solicitor-client privilege. This is sometimes referred to as
the “future crimes and fraud exception”. If a client intends to pursue a criminal purpose and
seeks legal advice for that purpose, solicitor-client privilege will not apply. For example, if a
solicitor were asked for a means of evading the Competition Act, such as a procedure for
entering into an illegal price fixing conspiracy, that communication would not be subject to
solicitor-client privilege. See generally Solosky v. Canada (1979), [1980] 1 S.C.R. 821, 105
D.L.R. (3d) 745 (S.C.C.); Descôteaux v. Mierzwinski, [1982] 1 S.C.R. 860, 141 D.L.R. (3d)
590 (S.C.C.); Smith v. Jones, [1999] 1 S.C.R. 455, 169 D.L.R. (4th) 385 (S.C.C.); R. v.
Shirose, 171 D.L.R. (4th) 193, (sub nom. R. v. Campbell) [1999] 1 S.C.R. 565 (S.C.C.).
Case Law
(Competition Trib.) — Solicitor-client privilege cannot be claimed on documentation that is
voluntarily delivered to the Director. Further, the combined effect of ss. 11 (orders for pro-
duction of documents and examinations), 19 and 29 (confidentiality requirements) of the Act
is that documentation not protected by s. 19 can be used by the Director in launching an
application under the Act.
Ed Miller Sales & Rentals Ltd. v. Caterpillar Tractor Co. (1988), 22 C.P.R. (3d) 290, 90
A.R. 323, 61 Alta. L.R. (2d) 319 (Alta. C.A.) — Solicitor-client privilege can be claimed on
documentation created for the purpose of use by solicitors in an inquiry by the Director. On
an inquiry, litigation is anticipated and, indeed, is in progress. The dominant purpose for
which the documents are prepared is therefore submission to a legal advisor for advice and
41
use in litigation. The privilege does not end once the Director terminates his inquiry. The
conclusion of the Director’s inquiry does not mean that the prospect of litigation ends. Sec-
tion 39 [now s. 36] expressly provides that civil rights of action remain. The issues raised by
the Director are still open to other litigants.
N.S. Pharmaceutical Society v. R. (1988), (sub nom. Pharmaceutical Society (N.S.) v. Can-
ada) 88 N.S.R. (2d) 70, 225 A.P.R. 70 (T.D.) — The Crown was refused permission to ex-
amine the documents with respect to which the applicants claimed solicitor-client privilege
in accordance with the provincial practice of not permitting inspection unless and until any
claim of privilege is rejected. However, the court indicated it would provide some particulars
as might prove necessary, although in the event, no request for further particulars was made.
Although ordinarily privilege can only be dealt with document by document, all counsel
found it convenient to deal with the very large number of documents in five groups, and the
judgment did so as well. Notices of termination of Member Pharmacy Agreement with re-
spect to various health insurance plans were not privileged as they were prepared with the
intention that they be communicated to a third party. Minutes of meetings of the applicant
society at which the Society’s solicitor was present and gave legal advice and at which such
advice was discussed or at which such advice was presented and discussed, were privileged.
Letters or circulars from the Society to members containing legal advice were privileged.
Blank, uncompleted forms of power of attorney were an embodiment of legal advice and
privileged but the designated attorney on completed forms was intended to be free to com-
municate the contents to third parties and accordingly these forms were not privileged.
20. (1) Inspection of records and things — All records or other things
obtained or received by the Commissioner may be inspected by the Commis-
sioner and also by such persons as he directs.
(2) Copies — Copies of any records referred to in subsection (1), made by
any process of reproduction, on proof orally or by affidavit that they are true
copies, are admissible in evidence in any proceedings under this Act and have
the same probative force as the original.
(3) Proof — Where proof referred to in subsection (2) is offered by affidavit,
it is not necessary to prove the signature or official character of the deponent,
if that information is set out in the affidavit, or to prove the signature or offi-
cial character of the person before whom the affidavit was sworn.
R.S.C. 1985, c. 19 (2nd Supp.), s. 24; 1999, c. 2, s. 37(l); 2010, c. 23, s. 72
Case Law
Lawson Business Forms (Man.) Ltd., Re (1987), 16 C.P.R. (3d) 167 (Sask. Prov. Ct.) — See
entry under s. 18.
21. Counsel — Whenever in the opinion of the Commissioner the public in-
terest so requires, the Commissioner may apply to the Attorney General of
Canada to appoint and instruct counsel to assist in an inquiry under section
10, and on such an application the Attorney General of Canada may appoint
and instruct counsel accordingly.
R.S.C. 1985, c. 19 (2nd Supp.), s. 24; 1999, c. 2, s. 37(m)
42
22. (1) Discontinuance of inquiry — At any stage of an inquiry under

section 10, if the Commissioner is of the opinion that the matter being inquired
into does not justify further inquiry, the Commissioner may discontinue the
inquiry.
(2) Report — The Commissioner shall, on discontinuing an inquiry, make a
Act
report in writing to the Minister showing the information obtained and the
reason for discontinuing the inquiry.
(3) Notice to applicant — Where an inquiry made on application under
section 9 is discontinued, the Commissioner shall inform the applicants of the
decision and give the grounds therefor.
(4) Review of decision — The Minister may, on the written request of ap-
plicants under section 9 or on the Minister’s own motion, review any decision
of the Commissioner to discontinue an inquiry under section 10, and may, if in
the Minister’s opinion the circumstances warrant, instruct the Commissioner
to make further inquiry.
R.S.C. 1985, c. 27 (1st Supp.), s. 187 (Sched. V, item 2); R.S.C. 1985, c. 19 (2nd Supp.),
s. 24; 1999, c. 2, s. 37(n)
Case Law
Austin v. Canada (Min. of Consumer & Corporate Affairs) (1986), 12 C.P.R. (3d) 190, 110
F.T.R. 83 (T.D.) — Section 22(4) imposes no time limit on the Minister to act, and hence he
is required to act within a reasonable time. In a case involving a nation-wide inquiry con-
cerning the conduct of major Canadian sugar companies, 55 days is not unreasonable. An
application for mandamus requiring the Minister to review the decision of the Director is
premature in such circumstances.
23. (1) Reference to Attorney General of Canada — The Commis-

sioner may, at any stage of an inquiry under section 10, in addition to or in
lieu of continuing the inquiry, remit any records, returns or evidence to the
Attorney General of Canada for consideration as to whether an offence has
been or is about to be committed against this Act and for such action as the
Attorney General of Canada may wish to take.
(2) Prosecution by Attorney General of Canada — The Attorney
General of Canada may institute and conduct any prosecution or other crimi-
nal proceedings under this Act, and for those purposes may exercise all the
powers and perform all the duties and functions conferred by the Criminal
Code on the attorney general of a province.
R.S.C. 1985, c. 19 (2nd Supp.), s. 24; 1999, c. 2, s. 37(o)
Case Law
Canadian Pacific Ltd. v. Canada (Director of Investigation & Research) (1997), 74 C.P.R.
(3d) 65 (Ont. Gen. Div. [Commercial List]) — Section 23 contemplates that criminal pro-
ceedings may proceed in tandem with the continued inquiry by the Director and, as a result,
43
the continued investigation under s. 10(1)(b)(ii) should not result in automatic termination of
s. 11 examinations.
24. (1) Regulations — The Governor in Council may make regulations reg-
ulating the practice and procedure in respect of applications, proceedings and
orders under sections 11 to 19.
(2) Publication of proposed regulations — Subject to subsection (3), a
copy of each regulation that the Governor in Council proposes to make under
subsection (1) shall be published in the Canada Gazette at least sixty days
before the proposed effective date thereof and a reasonable opportunity shall
be afforded to interested persons to make representations with respect thereto.
(3) Exception — No proposed regulation need be published under subsec-
tion (2) if it has previously been published pursuant to that subsection,
whether or not it has been amended as a result of representations made pursu-
ant to that subsection.
R.S.C. 1985, c. 19 (2nd Supp.), s. 24
Commentary
No regulations have been made under this section.
25. Staff — All officers, clerks and employees required for carrying out this
Act shall be appointed in accordance with the Public Service Employment Act,
except that the Commissioner may, with the approval of the Governor in
Council, employ such temporary, technical and special assistants as may be
required to meet the special conditions that may arise in carrying out this Act.
R.S.C. 1985, c. 19 (2nd Supp.), s. 25; 1999, c. 2, s. 37(p)
26. (1) Remuneration of temporary staff — Any temporary, technical

and special assistants employed by the Commissioner shall be paid such remu-
neration, and are entitled to be paid such travel and living expenses incurred
in the performance of their duties under this Act, as may be fixed by the Gov-
ernor in Council.
(2) Remuneration and expenses payable out of appropriations —
The remuneration and expenses of the Commissioner and of the temporary,
technical and special assistants employed by the Commissioner, and of any
counsel instructed under this Act, shall be paid out of money appropriated by
Parliament to defray the cost of administering this Act.
(3) Public Service Employment Act applies — Subject to this section
and section 7, the Public Service Employment Act and other Acts relating to the
public service, in so far as applicable, apply to the Commissioner and to all
other persons employed under this Act.
R.S.C. 1985, c. 19 (2nd Supp.), s. 25; 1999, c. 2, s. 37(q); 2003, c. 22, s. 225(r)
44
27. Authority of technical or special assistants — Any technical or

special assistant or other person employed under this Act, when so authorized
or deputed by the Commissioner, has power and authority to exercise any of
the powers and perform any of the duties of the Commissioner under this Act
with respect to any particular inquiry, as may be directed by the
Act
Commissioner.
1999, c. 2, s. 37(r)
Case Law
Lawson Business Forms (Man.) Ltd., Re (1987), 16 C.P.R. (3d) 167 (Sask. Prov. Ct.) — See
entry under s. 18.
28. Minister may require interim report — The Minister may at any
time require the Commissioner to submit an interim report with respect to
any inquiry by him under this Act, and it is the duty of the Commissioner
whenever thereunto required by the Minister to render an interim report set-
ting out the action taken, the evidence obtained and the Commissioner’s opin-
ion as to the effect of the evidence.
1999, c. 2, s. 37(r)
29. (1) Confidentiality — No person who performs or has performed duties

or functions in the administration or enforcement of this Act shall communi-
cate or allow to be communicated to any other person except to a Canadian
law enforcement agency or for the purposes of the administration or enforce-
ment of this Act
(a) the identity of any person from whom information was obtained pur-
suant to this Act;
(b) any information obtained pursuant to section 11, 15, 16 or 114;
(b.1) any information obtained under any of sections 53.71 to 53.81 of the
Canada Transportation Act;
(c) whether notice has been given or information supplied in respect of a
particular proposed transaction under section 114;
(d) any information obtained from a person requesting a certificate under
section 102; or
(e) any information provided voluntarily pursuant to this Act.
(2) Exception — This section does not apply in respect of any information
that has been made public or any information the communication of which
was authorized by the person who provided the information.
R.S.C. 1985, c. 19 (2nd Supp.), s. 26; 2002, c. 16, s. 2.1; 2018, c. 10, s. 83
Commentary
Section 29 deals with the treatment of confidential information in the possession of the Com-
petition Bureau. (See also subsection 10(3), which requires that all inquiries carried out by
the Bureau be conducted in private.)
45
Section 29 requires that certain information be maintained in confidence, subject to two ex-
ceptions. First, information may be disclosed to a Canadian law enforcement agency. Sec-
ond, information may be disclosed in order to administer or enforce the Act. Thus, for exam-
ple, information provided by a customer to the Competition Bureau during a merger
investigation would be protected by paragraph 29(1)(e) but may be disclosed in the context
of a Competition Tribunal hearing if the Commissioner of Competition sought to challenge
the merger.
The Bureau takes the position that section 29 allows the agency to share confidential infor-
mation with foreign competition law enforcers on the grounds that such exchanges are being
made for purposes relating to the administration or enforcement of the Act. As a conse-
quence, the Bureau does not normally request the consent of or give notice to parties whose
information it proposes to share with foreign enforcers. Similarly, if parties attempt to pro-
vide a waiver authorizing the Bureau to exchange information under certain conditions (e.g.,
that the recipient also treat such information as confidential), the Bureau may refuse to ac-
cept the waiver as an inappropriate fetter on its discretion. This interpretation of section 29 is
questionable. The reference to “a Canadian law enforcement agency” (and not merely “a law
enforcement agency”) in subsection 29(1) and the comprehensive scheme for mutual legal
assistance in Part III suggest that Parliament did not intend to grant the Bureau an unfettered
ability to share information with foreign competition law enforcers.
In R. v. Stucky (2006), 53 C.P.R. (4th) 369 (Ont. S.C.J.); reversed on other grounds 2009
CarswellOnt 745 (Ont. C.A.), the Ontario Superior Court acknowledged that the Bureau had
shared information obtained from a search warrant with foreign law enforcement agencies
“in the fond hope that the sharing of information would inure to its benefit in respect of its
own domestic investigations and prosecutions.” The court also distinguished the exchange of
information under section 29 from the exchange of information under an MLAT application
when a foreign agency requests Canadian cooperation in connection with a foreign investiga-
tion or prosecution. However, at issue in Stucky was whether the Bureau should have alerted
the court, when it applied for a search warrant, of its intention to share information with a
foreign agency. The court determined that such disclosure was not necessary, but it did not
consider the scope of section 29 itself or whether it actually does permit information sharing
with foreign agencies.
Section 29, in conjunction with subsection 10(3), restricts the ability of the Bureau to pub-
licise the fact that it is conducting a formal inquiry, in addition to limiting the information in
its possession that can be provided to the public. However, in this regard, section 29 does not
apply to informal investigations undertaken by the Bureau prior to commencing a formal
section 10 inquiry. For example, in August 2020, the Bureau issued a call for information
from market participants in connection with a potential abuse of dominance investigation
into Amazon.ca, thereby announcing its intention to pursue a formal inquiry into Amazon.ca.
For additional detail on the Bureau’s interpretation on section 29, see Information Bulletin
on the Communication of Confidential Information Under the Competition Act (Ottawa:
Competition Bureau, 2013). See also Hostile Transaction Interpretation Guideline Number
2: Bureau Policy on Disclosure of Information.
Case Law
Pro-Sys Consultants Ltd. v. Microsoft Corp., 2016 BCSC 97 (B.C. S.C.) — The Court con-
sidered whether the Competition Bureau was required to provide to plaintiffs in a class ac-
tion documents relating to prior investigations, which had occurred 10–15 years earlier and
were not directly related to the current class action proceedings. Section 29 did not apply
46
because a section 36 action falls within the exception in section 29(1). However, both
Microsoft and the Competition Bureau opposed the application on the basis that the docu-
ments were privileged, and as well on the basis that they were not relevant, that the request
was overbroad, and that the production of such documents would be disproportional. The
Court did not accept that the fact the investigations were done under Part 8 necessarily
makes the documents irrelevant to a Part 6 action. The Court agreed with the plaintiffs that
Act
there may be substantial overlaps between the two in terms of ascertaining the market, the
state of the market, the competition within it and Microsoft’s behaviour that might relate to
both parts of the Act.
R. v. Nestlé Canada Inc., 2015 ONSC 810 (Ont. S.C.J.) — Based on information provided to
the Competition Bureau by Cadbury relating to a domestic price fixing cartel, the Competi-
tion Bureau executed search warrants against Nestlé and Hershey. Cadbury was granted im-
munity and Hershey pled guilty in exchange for leniency in sentencing. When the Crown
made disclosure to the accused, it inadvertently included some documents provided by Her-
shey and Cadbury. Solicitor-client privilege did not apply to the information. Even if solici-
tor-client privilege applied, it was waived once the information was revealed to the Competi-
tion Bureau for the purpose of entering into a plea agreement. Settlement privilege did not
apply to prohibit the disclosure of factual information provided to the Crown. The informa-
tion was likely relevant to the accused and neither Cadbury nor Hershey could point to any
specific prejudice that would be occasioned to them from the disclosure of the information to
the accused. Furthermore, in providing the information, both Cadbury and Hershey knew
that the information would be used against others. Even if settlement privilege applied, there
should be an exception to settlement privilege in this case so that the information could be
disclosed to the accused on the basis of the accused’s right to make full answer and defence.
Furthermore, Cadbury and Hershey waived privilege as a clause in the agreement indicated
that the information would be disclosed as required by law.
Jacques c. Pétroles Irving inc., 2014 SCC 66 (S.C.C.) — The case arose in the context of a
class proceeding relating to price-fixing by various gasoline distributors in Quebec. The
class proceeding was commenced contemporaneously with a criminal prosecution. The issue
to be determined on appeal was whether a party to a civil proceeding can request disclosure
of recordings of private communications intercepted by the Bureau in the course of a crimi-
nal investigation. A majority of the Court dismissed the appeal by the defendants, who re-
sisted disclosure, on the basis that while s. 29 of the Competition Act provides for confidenti-
ality of the Competition Bureau’s record of investigation, it does not prohibit the disclosure
of private communications intercepted under Part VI of the Criminal Code.
Metropolitan Toronto Apartment Builders Assn. v. LIUNA, Local 183, 2014 ONSC 4976
(Ont. Div. Ct.) — Although not a s. 29 case, the court held that confidentiality orders may be
granted by courts where competitively sensitive financial information is at issue. Confidenti-
ality orders will not be granted to prevent disclosure of Competition Bureau advisory
opinions.
Canada (Commissioner of Competition) v. Chatr Wireless Inc., 2011 ONSC 3387, 2011
CarswellOnt 4451 (Ont. S.C.J.) — In the course of a proceeding pursuant to s. 74.01, the
Commissioner sought an order that information in its possession be kept confidential and not
disclosed prior to, during or after the proceeding. In concluding that the requested order be
limited in scope and the disclosure of certain commercially sensitive information be permit-
ted, the court noted that while the Competition Bureau’s assurance of confidentiality encour-
ages voluntary co-operation in its enforcement activities and the disclosure of such informa-
tion potentially causes a serious risk to the proper administration of justice, the nature of the
assurances given by the Commissioner with respect to confidentiality are not absolute and
47
are well-known. The Commissioner’s public guidance indicates that while efforts will be
taken to prevent or minimize the disclosure of confidential and competitively-sensitive infor-
mation, the information may be disclosed in the course of proceedings before the courts or
the Competition Tribunal. Every time the Commissioner concludes an investigation and de-
cides to commence proceedings, and until the court or the Tribunal, as the case may be,
makes a ruling, the risk of disclosure exists. In reaching a conclusion with respect to the
preservation of confidentiality, the court will be guided by the factors outlined by the Su-
preme Court in Sierra Club of Canada v. Canada (Minister of Finance), 2002 SCC 41,
[2002] 2 S.C.R. 522 (S.C.C.).
Canada (Commissioner of Competition) v. Sears Canada Inc. (2003), 24 C.P.R. (4th) 534
(Competition Trib.) — Section 29 of the Act does not prohibit the Commissioner from using
transcripts of an examination conducted under s. 11 of the Act as evidence on a prehearing
motion. Leave is not required in order to introduce the transcript of the examination on a
prehearing motion.
Forest Protection Ltd. v. Bayer AG (1996), (sub nom. Forest Protection Ltd. v. Bayer A.G.)
68 C.P.R. (3d) 59, 178 N.B.R. (2d) 129, 454 A.P.R. 129 (Q.B.); leave to appeal refused (July
2, 1996), Doc. 131/96/CA, 132/96/CA, 134/96/CA (N.B. C.A.); leave to appeal refused
(1996), 182 N.B.R. (2d) 319 (note), 463 A.P.R. 319 (note), 182 N.B.R. (2d) 320 (note), 463
A.P.R. 320 (note), 206 N.R. 159 (note) (S.C.C.) — In a civil action pursuant to s. 36 alleging
price-fixing by the defendants, discovery of documents in the possession of the Director
which had been seized pursuant to a s. 10 inquiry which ultimately resulted in a guilty plea,
was permitted subjected to the claims of any third-party privilege.
Notwithstanding the failure to gain access to the information under the Access to Information
Act, R.S.C. 1985, c. A-1, and the possibility of an appeal therefrom to the Federal Court, it
was within the jurisdiction of a superior court of a province to grant discovery of such docu-
ments since s. 29, which prohibits disclosure of documents seized, is subject to an exception
where such disclosure is “... for the purposes of the administration or enforcement of this
Act...”. The bringing of a civil action falls within such exception.
(Competition Trib.) — The combined effect of ss. 11 (orders for production of documents
and examinations), 19 (claims of solicitor-client privilege) and 29 of the Act is that docu-
mentation not protected by s. 19 can be used by the Director in launching an application
under the Act.
(Competition Trib.) — The confidentiality provisions found in subs. 29(2) of the Act cease
to apply once the investigation has stopped and proceedings before the Competition Tribunal
have commenced. Pursuant to r. 40(1) [now r. 29] of the Competition Tribunal Rules, all
proceedings before the Tribunal are public in nature.
Middlekamp v. Fraser Valley Real Estate Board (1990), 29 C.P.R. (3d) 385 (B.C. Master);
affirmed (1990), 32 C.P.R. (3d) 206 (B.C.S.C.) — Section 29 does not bind the target of an
investigation, but the firm hired by the Director was required by s. 29 not to disclose infor-
mation obtained pursuant to the Act. On appeal, the court found that the computer program
used by the firm was not “information,” so s. 29 did not apply to the computer program, but
s. 29(1)(b) applied to the firm.
29.1 (1) Communication to Minister of Transport — Notwithstanding

subsection 29(1), the Commissioner may, if requested to do so by the Minister
of Transport in accordance with subsection (3), communicate or allow to be
48
Part II — Administration (ss. 7–29.2) S. 29.2(1)
communicated to that Minister any information referred to in subsection (2)

that is specifically requested by that Minister.
(2) Information — The information that may be communicated under this
section is
(a) the identity of any person from whom information was obtained under
Act
this Act;
(b) any information obtained in the course of an inquiry under section 10;
(c) any information obtained under section 11, 15, 16 or 114;
(c.1) any information obtained under any of sections 53.71 to 53.81 of the
Canada Transportation Act;
section 102;
(e) whether notice has been given or information supplied in respect of a
particular proposed transaction under section 114; and
(f) any information collected, received or generated by or on behalf of the
Commissioner, including compilations and analyses.
(3) Contents of request — Requests under this section must be in writing
and must
(a) specify the information referred to in any of paragraphs (2)(a) to (f)
that is required; and
(b) state that the Minister of Transport requires the information for the
purposes of section 53.1 or 53.2 or any of sections 53.71 to 53.81 of the
Canada Transportation Act and identify the transaction being considered
under that section.
(4) Restriction — The information communicated under subsection (1) may
be used only for the purposes of section 53.1 or 53.2 or any of sections 53.71 to
53.81, as the case may be, of the Canada Transportation Act.
(5) Confidentiality — No person who performs or has performed duties or
functions in the administration or enforcement of the Canada Transportation
Act shall communicate or allow to be communicated to any other person any
information communicated under subsection (1), except to persons who per-
form duties or functions under section 53.1 or 53.2 or any of sections 53.71 to
53.81 of that Act.
2000, c. 15, s. 12; 2007, c. 19, s. 61; 2018, c. 10, s. 84
29.2 (1) Communication to Minister of Finance — Notwithstanding

subsection 29(1), the Commissioner may, if requested to do so by the Minister
of Finance in accordance with subsection (3), communicate or allow to be com-
municated to the Minister of Finance any information referred to in subsec-
tion (2) that is specifically requested by the Minister of Finance.
49
S. 29.2(2) Competition Act
(2) Information — The information that may be communicated under this

section is
(a) the identity of any person from whom information was obtained under
this Act;
(b) any information obtained in the course of an inquiry under section 10;
(c) any information obtained under section 11, 15, 16 or 114;
section 102;
(e) whether notice has been given or information supplied in respect of a
particular proposed transaction under section 114; and
(f) any information collected, received or generated by or on behalf of the
Commissioner, including compilations and analyses.
(3) Contents of request — Requests under this section must be in writing
and must
(a) specify the information referred to in any of paragraphs (2)(a) to (f)
that is required;
(b) state that the Minister of Finance requires the information
(i) to consider a merger or proposed merger under the Bank Act, the
Cooperative Credit Associations Act, the Insurance Companies Act or
the Trust and Loan Companies Act, or
(ii) to permit the Minister of Finance to determine whether he or she
should provide the Commissioner with a certificate described in par-
agraph 94(b) in respect of such a merger or proposed merger;
and
(c) identify the merger or proposed merger.
(4) Restriction — The information communicated under subsection (1) may
be used only for the purpose of making a decision in respect of the merger or
proposed merger.
(5) Confidentiality — No person who performs or has performed duties or
functions, in the administration or enforcement of the Bank Act, the Coopera-
tive Credit Associations Act, the Insurance Companies Act or the Trust and Loan
Companies Act shall communicate or allow to be communicated to any other
person any information communicated under subsection (1), except to other
persons who perform those duties or functions.
2001, c. 9, s. 578
50
Part III — Mutual Legal Assistance S. 30
PART III — MUTUAL LEGAL ASSISTANCE (SS. 30–30.3)

Interpretation
[Heading added 2002, c. 16, s. 3.]
Act
30. Definitions — The definitions in this section apply in this Part.
“agreement” means a treaty, convention or other international agreement to
which Canada is a party that provides for mutual legal assistance in competi-
tion matters, other than a matter in respect of which the Mutual Legal Assis-
tance in Criminal Matters Act applies. (“accord”)
“conduct” means conduct or matters within the meaning of the relevant agree-
ment in respect of which mutual legal assistance may be requested in accor-
dance with this Part. (“comportement”)
“data” [Repealed 2014, c. 31, s. 32.]
“foreign state” means a country other than Canada, and includes any interna-
tional organization of states. (“État étranger”)
“judge” means
(a) in Ontario, a judge of the Superior Court of Justice;
(b) in Quebec, a judge of the Superior Court;
(c) in Nova Scotia, British Columbia, Prince Edward Island, Yukon and
the Northwest Territories, a judge of the Supreme Court, and in Nunavut,
a judge of the Nunavut Court of Justice;
(d) in New Brunswick, Manitoba, Saskatchewan and Alberta, a judge of
the Court of Queen’s Bench;
(e) in Newfoundland and Labrador, a judge of the Trial Division of the
Supreme Court; and
(f) in any province or territory, a judge of the Federal Court.
(“juge”)
2002, c. 7, s. 276; 2002, c. 8, s. 198(c)(i); 2002, c. 16, s. 3; 2014, c. 31, s. 32; 2015, c.
3, s. 38
Commentary
Part III provides the legal basis for the government to enter into agreements for reciprocal
assistance in civil competition matters and prescribes the minimum prerequisites to be in-
cluded in any mutual legal assistance agreement. The provisions set out in Part III do not in
themselves permit the Competition Bureau to take any action other than through the auspices
of a treaty, and the government has not yet entered into any civil Mutual Legal Assistance
Treaties (“MLATs”). The absence of any agreements does not prevent other forms of co-
operation in cross border civil cases, as confirmed in section 30.3. In the context of a foreign
request for information, it may be possible for the Bureau to send information abroad pursu-
ant to section 29. In the context of a domestic investigation, it may be possible for the Bu-
51
reau to gather information located abroad pursuant to subsection 11(2). However, the lack of
any civil MLATs under Part III would prevent, for example, a foreign state investigating a
potential abuse of dominance matter from requiring the Bureau to gather information in Can-
ada on its behalf.
Part III applies to only to civil competition matters and not to matters in respect of which the
Mutual Legal Assistance in Criminal Matters Act applies. For a commentary on criminal
MLATs in the competition context, see Oliver Borgers and Madeleine Renaud, “Mutual Le-
gal Assistance in Criminal Antitrust Matters: A Canadian Perspective” presented at the 8th
Annual Competition Conference Held 17-18 September 2004 in Fiesole, Italy (London, En-
gland: International Bar Association, 2004).
Additional information on the Bureau’s interpretation of Part III may be found in Mutual
Legal Assistance in Civil Competition Matters (Part III of the Competition Act): Back-
grounder (Ottawa: Competition Bureau, June 2002). See also Speaking Notes for Konrad
von Finckenstein Commissioner of Competition on Bill C-23 An Act to Amend the Competi-
tion Act and the Competition Tribunal Act, Senate Committee on Banking, Trade and Com-
merce (24 April 2002).
Functions of the Minister of Justice

30.01 Agreements respecting mutual legal assistance — Before

Canada enters into an agreement, the Minister of Justice must be satisfied that
(a) the laws of the foreign state that address conduct that is similar to
conduct prohibited or reviewable under this Act are, in his or her opin-
ion, substantially similar to the relevant provisions of this Act, regardless
of whether the conduct is dealt with criminally or otherwise;
(b) any record or thing provided by Canada under the agreement will be
protected by laws respecting confidentiality that are, in his or her opinion,
substantially similar to Canadian laws;
(c) the agreement contains provisions in respect of
(i) the circumstances in which Canada may refuse, in whole or in
part, to approve a request, and
(ii) the confidentiality protections that will be afforded to any record
or thing provided by Canada;
(c.1) the agreement contains one of the following undertakings by the for-
eign state:
(i) that any record or thing provided by Canada will be used only for
the purpose for which it was requested, or
(ii) that any record or thing provided by Canada will be used only for
the purpose for which it was requested or for the purpose of making
a request under any Act of Parliament or under any treaty, conven-
tion or other international agreement to which Canada and the for-
eign state are parties that provides for mutual legal assistance in civil
or criminal matters;
52
Part III — Mutual Legal Assistance S. 30.01
(d) the agreement also contains the following undertakings by the foreign
state, namely,
(i) that it will provide assistance to Canada comparable in scope to
that provided by Canada,
(ii) [Repealed 2020, c. 1, s. 22(3).]
Act
(iii) that any record or thing provided by Canada will be used subject
to any terms and conditions on which it was provided, including con-
ditions respecting applicable rights or privileges under Canadian
law,
(iv) that, at the conclusion of the investigation or proceedings in re-
spect of which any record or thing was provided by Canada, the for-
eign state will return the record or thing and any copies to Canada
or, with the consent of Canada, return the record or thing to Canada
and destroy any copies,
(v) subject to paragraph (c.1), that it will, to the greatest extent possi-
ble consistent with its laws, keep confidential any record or thing ob-
tained by it pursuant to its request, and oppose any application by a
third party for disclosure of the record or thing, and
(vi) that it will promptly notify the Minister of Justice in the event
that the confidentiality protections contained in the agreement have
been breached; and
(e) the agreement contains a provision in respect of the manner in which
it may be terminated.
2002, c. 16, s. 3; 2020, c. 1, s. 22
Commentary
Prior to Canada entering into an agreement respecting mutual legal assistance, the Minister
of Justice must be satisfied that:
• the laws of the foreign state that the conduct are substantially similar to Canadian law;
• the information provided will be subject to confidentiality laws substantially similar to
Canadian laws;
• the proposed agreement will contain provisions specifying the circumstances wherein
Canada may refuse a request, and the applicable confidentiality provisions;
• the proposed agreement will contain undertakings that the foreign state will provide
similar assistance to Canada, the information provided will not be used for other pur-
poses, all information will be returned or, on consent, destroyed, the recipient will keep
the information confidential, and the recipient will promptly notify the Minister of Jus-
tice if the confidentiality agreement is breached; and
• the agreement contains a termination provision.
53
Publication of Agreements
30.02 (1) Publication in Canada Gazette — An agreement must be pub-

lished in the Canada Gazette no later than 60 days after the agreement comes
into force, unless it has already been published under subsection (2).
(2) Publication in Canada Treaty Series — An agreement may be pub-
lished in the Canada Treaty Series and, if so published, the publication must be
no later than 60 days after the agreement comes into force.
(3) Judicial notice — Agreements published in the Canada Gazette or the
Canada Treaty Series are to be judicially noticed.
2002, c. 16, s. 3
Commentary
A mutual assistance agreement must be published in the Canada Gazette, or may be pub-
lished in the Canada Treaty Series not later than 60 days after it comes into force. Once
published, a court may take judicial notice of the agreement, and the existence of the agree-
ment does not need to be proven by evidence.
Requests Made to Canada from Abroad

Requests
30.03 Requests — The Minister of Justice is responsible for dealing with a

request made by a foreign state under an agreement, in accordance with the
agreement and this Part.
2002, c. 16, s. 3
Commentary
The Act contemplates four different judicial orders by which evidence may be gathered for
use in a foreign proceeding:
• a search and seizure order (search warrant);
• an order to permit evidence-gathering for use in the foreign state;
• an order to permit the “virtual presence” (video teleconferencing) of a person in the
foreign state; and
• an order permitting the lending to a foreign state of an exhibit previously used as evi-
dence in another proceeding. In all instances, the process is commenced by the foreign
state making a “request”.
54
Part III — Mutual Legal Assistance S. 30.06(1)(c)
Search and Seizure

30.04 Application of sections 15, 16 and 19 — Sections 15, 16 and 19

apply, with any modifications that the circumstances require, in respect of a
Act
search or a seizure under this Part, except to the extent that those sections are
inconsistent with this Part.
2002, c. 16, s. 3
Commentary
Where the Canadian government undertakes a search and seizure pursuant to a request by a
foreign government, the procedural protections in sections 15, 16 and 19 of the Act will
continue to apply, except to the extent that those sections are inconsistent with Part III.
Those sections deal with search warrant requirements, procedures for asserting solicitor-cli-
ent privilege, and rules for retrieving data from a computer system.
30.05 (1) Approval of request for search and seizure — If the Min-
ister of Justice approves a request of a foreign state to have a search and
seizure carried out in respect of conduct that is the subject of the request, the
Minister of Justice shall provide the Commissioner with any documents or in-
formation necessary to apply for a search warrant.
(2) Application for search warrant — The Commissioner or the author-
ized representative of the Commissioner shall apply ex parte for a search war-
rant to a judge.
2002, c. 16, s. 3
Commentary
The Minister of Justice, upon receiving a request, provides the Commissioner of Competi-
tion with the information necessary to apply ex parte to a judge of the Superior Court of the
province or Territory for the warrant.
30.06 (1) Warrant for entry of premises — A judge to whom an applica-

tion is made under subsection 30.05(2) may issue a search warrant authorizing
the person named in it to execute it anywhere in Canada where the judge is
satisfied by information on oath or solemn affirmation that there are reasona-
ble grounds to believe that
(a) conduct that is the subject of a request made by a foreign state is tak-
ing place, has taken place or is about to take place;
(b) evidence in respect of the conduct referred to in paragraph (a) will be
found in any premises; and
(c) it would not, in the circumstances, be appropriate to make an order
under subsection 30.11(1).
55
(2) Authorization — A search warrant issued under subsection (1) autho-

rizes the person named in it to enter the premises specified in the warrant,
subject to any conditions that may be specified in the warrant, and to search
the premises for any record or thing specified in the warrant and to examine
and seize it.
(3) Hearing re execution — A judge who issues a search warrant under
subsection (1) shall fix a time and place for a hearing to consider the execution
of the warrant as well as the report referred to in section 30.07.
(4) Contents of warrant — A search warrant issued under subsection (1)
must
(a) set out the time and place for the hearing mentioned in subsection (3);
(b) state that, at that hearing, an order will be sought for the sending to
the foreign state of the records or things seized in execution of the war-
rant; and
(c) state that every person from whom a record or thing is seized in execu-
tion of the warrant and any person who claims to have an interest in a
record or thing so seized may make representations at the hearing before
any order is made concerning the record or thing.
(5) Duty of persons in control of premises — Every person who is in
possession or control of any premises, record or thing in respect of which a
search warrant is issued under subsection (1) shall, on presentation of the war-
rant, permit the person named in the warrant to enter the premises, search the
premises and examine the record or thing and seize it.
(6) Where admission or access refused — Where a person, in execut-
ing a search warrant issued under subsection (1), is refused access to any
premises, record or thing or where the Commissioner believes on reasonable
grounds that access will be refused, the judge who issued the warrant or a
judge of the same court, on the ex parte application of the Commissioner or the
authorized representative of the Commissioner, may by order direct a peace
officer to take any steps that the judge considers necessary to give access to the
person named in the warrant.
2002, c. 16, s. 3
Commentary
The superior court judge may issue the warrant where the judge is satisfied that there are
reasonable grounds to believe that
• conduct that is the subject of the request by the foreign state is taking place, has taken
place or will take place;
• evidence of the conduct will be found on the premises for which the warrant is sought;
and
• it would not be more appropriate to make an “evidence-gathering order” under s. 30.11.
56
Part III — Mutual Legal Assistance S. 30.08(1)(a)(ii)
A person in control of the premises or in possession of the information sought under the
warrant must permit the search (s. 30.06(5)). Where a person in control refuses access, or
there is reason to believe that access will be refused, the judge who issued the warrant or a
judge of the same court, on an ex parte application, may by order direct a peace officer to
take any steps that the judge considers necessary to give access to the person named in the
warrant (s. 30.06(6)). Every person in control who refuses access “without good and suffi-
Act
cient cause, the proof of which lies on that person” is liable to a fine of up to $5,000 and/or
up to two years’ imprisonment (s. 65.1(1)). Similarly, destroying or altering such informa-
tion is an offence punishable on summary conviction by a fine of up to $25,000 and/or im-
prisonment up to two years or, on indictment, by a fine of up to $50,000 and/or up to five
years’ imprisonment (s. 65.1(2)).
The judge must, at the time the warrant is issued, schedule a hearing to consider the execu-
tion of the warrant. Any person claiming to have an interest in the information seized may
make representations at the hearing.
30.07 (1) Report — The person who executes a search warrant shall, at least
five days before the time of the hearing to consider its execution, file with the
court of which the judge who issued the warrant is a member a written report
concerning the execution of the warrant that includes a general description of
the records or things seized.
(2) Copy to Minister of Justice — The person who files the report under
subsection (1) shall send a copy of it to the Minister of Justice promptly after
its filing.
2002, c. 16, s. 3
Commentary
The person who executes a search warrant must file with the court, at least five days in
advance of the hearing, a written report concerning the execution of the warrant and a gen-
eral description of the information seized.
30.08 (1) Sending abroad — At the hearing referred to in subsection

30.06(3), after having considered any representations of the Minister of Jus-
tice, the Commissioner, the person from whom a record or thing was seized
and any person who claims to have an interest in the record or thing, the judge
who issued the search warrant or another judge of the same court may
(a) where the judge is not satisfied that the warrant was executed accord-
ing to its terms and conditions or where the judge is satisfied that an or-
der should not be made under paragraph (b), order that a record or thing
seized be returned to
(i) the person from whom it was seized, if possession of it by that
person is lawful, or
(ii) the lawful owner or the person who is lawfully entitled to its pos-
session, if the owner or that person is known and possession of the
record or thing by the person from whom it was seized is unlawful;
or
57
S. 30.08(1)(b) Competition Act
(b) in any other case, order that a record or thing seized be sent to the
foreign state mentioned in subsection 30.05(1) and include in the order
any terms and conditions that the judge considers desirable, including
terms and conditions
(i) necessary to give effect to the request mentioned in that
subsection,
(ii) in respect of the preservation and return to Canada of any record
or thing seized, and
(iii) in respect of the protection of the interests of third parties.
(2) Requiring record, etc., at hearing — At the hearing mentioned in
subsection (1), the judge may require that a record or thing seized be brought
before him or her.
2002, c. 16, s. 3
Commentary
After considering all of the representations at the hearing, a judge of the court may:
• order that the information be sent to the foreign state, subject to any conditions the
judge considers desirable; or
• if the search warrant has not been properly executed, order the information returned.
30.09 Terms and conditions — No record or thing seized that has been
ordered under section 30.08 to be sent to a foreign state shall be so sent until
the Minister of Justice is satisfied that the foreign state has agreed to comply
with any terms or conditions imposed in respect of the sending abroad of the
record or thing.
2002, c. 16, s. 3
Evidence for Use Abroad

30.1 (1) Approval of request to obtain evidence — If the Minister of

Justice approves a request of a foreign state to obtain, by means of an order of
a judge, evidence in respect of conduct that is the subject of the request, the
Minister of Justice shall provide the Commissioner with any documents or in-
formation necessary to apply for the order.
(2) Application for order — The Commissioner or the authorized repre-
sentative of the Commissioner shall apply ex parte to a judge for an order for
the gathering of evidence.
2002, c. 16, s. 3
30.11 (1) Evidence-gathering order — A judge to whom an application is

made under subsection 30.1(2) may make an order for the gathering of evi-
58
Part III — Mutual Legal Assistance S. 30.11(7)
dence where the judge is satisfied that there are reasonable grounds to believe
that
ing place, has taken place or is about to take place; and
(b) there will be found in Canada evidence in respect of the conduct re-
Act
ferred to in paragraph (a).
(2) Provisions of order — An order made under subsection (1) must pro-
vide for the manner in which the evidence is to be obtained in order to give
effect to the request mentioned in subsection 30.1(1) and may
(a) order the examination, on oath or otherwise, of a person named in the
order, order the person to attend at the place fixed by the person desig-
nated under paragraph (c) for the examination and to remain in attend-
ance until he or she is excused by the person so designated, order the per-
son so named, where appropriate, to make a copy of a record or to make
a record from data and to bring the copy or record with him or her, and
order the person so named to bring with him or her any record or thing
in his or her possession or control, in order to produce them to the person
before whom the examination takes place;
(b) order a person named in the order to make a copy of a record or to
make a record from data and to produce the copy or record to the person
designated under paragraph (c), order the person to produce any record
or thing in his or her possession or control to the person so designated
and provide, where appropriate, for any affidavit or certificate that, pur-
suant to the request, is to accompany any copy, record or thing so pro-
duced; and
(c) designate a person before whom the examination referred to in para-
graph (a) is to take place or to whom the copies, records, things, affidavits
and certificates mentioned in paragraph (b) are to be produced.
(3) Designation of judge — For greater certainty, a judge who makes an
order under subsection (1) may designate himself or herself or another person,
including a judge of a Canadian or foreign court, under paragraph (2)(c).
(4) Order effective throughout Canada — An order made under sub-
section (1) may be executed anywhere in Canada.
(5) Terms and conditions of order — An order made under subsection
(1) may include any terms or conditions that the judge considers desirable,
including those relating to the protection of the interests of a person named in
the order and of third parties.
(6) Variation — The judge who made the order under subsection (1) or an-
other judge of the same court may vary its terms and conditions.
(7) Other laws to apply — A person named in an order made under sub-
section (1) shall answer questions and produce records or things to the person
59
designated under paragraph (2)(c) in accordance with the laws of evidence and
procedure in the foreign state that presented the request, but may refuse if
answering the questions or producing the records or things would disclose in-
formation that is protected by the Canadian law of non-disclosure of informa-
tion or privilege.
(8) Execution of order to be completed — If a person refuses to answer
a question or to produce a record or thing, the person designated under para-
graph (2)(c)
(a) may, if he or she is a judge of a Canadian or foreign court, make im-
mediate rulings on any objections or issues within his or her jurisdiction;
or
(b) shall, in any other case, continue the examination and ask any other
question or request the production of any other record or thing men-
tioned in the order.
(9) Statement of reasons for refusal — A person named in an order
made under subsection (1) who, under subsection (7), refuses to answer one or
more questions or to produce certain records or things shall, within seven
days, give to the person designated under paragraph (2)(c), unless that person
has already ruled on the objection under paragraph (8)(a), a detailed state-
ment in writing of the reasons on which the person bases the refusal to answer
each question that the person refuses to answer or to produce each record or
thing that the person refuses to produce.
(10) Expenses — A person named in an order made under subsection (1) is
entitled to be paid the travel and living expenses to which the person would be
entitled if the person were required to attend as a witness before the judge
who made the order.
(11) Contents of order — An order made under subsection (1) must state
that a person named in the order, and any person who claims an interest in
any record or thing provided pursuant to the order, may make representa-
tions referred to in subsection 30.13(2) before any order is made under subsec-
tion 30.13(1).
2002, c. 16, s. 3
Commentary
In appropriate cases, a court may order the examination under oath of a person, together with
the production of records in the person’s possession. As in the case of a search warrant, the
Minister of Justice shall, upon approving a request by a foreign state, provide the Commis-
sioner of Competition with the necessary information to apply ex parte to a judge for an
order. The judge may make this “evidence-gathering” order where the judge is satisfied that:
• the conduct that is the subject of the request by the foreign state is taking place, has
taken place or will take place; and
• the evidence of the conduct will be found in Canada.
60
The order may be executed anywhere in Canada and may be subject to the terms and condi-
tions the judge considers desirable, including those relating to the protection or interests of a
person named in the order and of third parties.
The person being examined pursuant to the order is required to answer questions and pro-
duce records in accordance with the laws of the requesting state, but may refuse to disclose
information that is protected by Canadian laws of non-disclosure or privilege (s. 30.11(7)). If
Act
the person refuses to answer a question, the examiner — if he or she is a judge of a Canadian
or foreign court — may rule immediately on the refusal and require the person to answer (s.
30.11(8(a)). Maintaining the refusal in spite of an order overruling the objection is an of-
fence punishable by a fine of up to $5,000 and/or up to two years’ imprisonment (s. 65.2).
Where the examiner is not a judge, the person must provide a detailed written statement
within seven days setting out the reasons for the refusal (s. 30.11(9)).
30.12 (1) Report — A person designated under paragraph 30.11(2)(c) in an

order made under subsection 30.11(1) shall make a report to the judge who
made the order, or another judge of the same court, accompanied by
(a) a transcript of every examination held under the order;
(b) a general description of every record or thing produced to the person
under the order and, if the judge so requires, a record or thing itself; and
(c) a copy of every statement given under subsection 30.11(9) of the rea-
sons for a refusal to answer any question or to produce any record or
thing.
(2) Copy to Minister of Justice — The person designated under para-
graph 30.11(2)(c) shall send a copy of the report to the Minister of Justice
promptly after it is made.
(3) Refusals — If any reasons contained in a statement given under subsec-
tion 30.11(9) are based on the Canadian law of non-disclosure of information
or privilege, a judge to whom a report is made shall determine whether those
reasons are well-founded and, if the judge determines that they are, that deter-
mination shall be mentioned in any order that the judge makes under section
30.13, but if the judge determines that they are not, the judge shall order that
the person named in the order made under subsection 30.11(1) answer the
questions or produce the records or things.
(4) Refusals based on foreign law — A copy of every statement given
under subsection 30.11(9) that contains reasons that purport to be based on a
law that applies to the foreign state shall be appended to any order that the
judge makes under section 30.13.
2002, c. 16, s. 3
Commentary
Where an order has been made under s. 30.11(1) for the examination under oath of a person,
the person designated to be the examiner shall make a report to the judge who made the
order, or to another judge of the same court, accompanied by a transcript of every examina-
tion held under the order; a general description of every record or thing produced to the
61
person; and a copy of every statement given under subs. 30.11(9) of the reasons for a refusal
to answer any question. Under subsection 30.12(3), where the reason for the refusal to an-
swer a question is based on Canadian law, a judge may then determine whether to uphold the
refusal or order that the question be answered.
30.13 (1) Sending abroad — A judge to whom a report is made under sub-
section 30.12(1) may order that there be sent to the foreign state mentioned in
subsection 30.1(1)
(a) the report, any transcript referred to in paragraph 30.12(1)(a) and any
record or thing produced;
(b) a copy of the order made under subsection 30.11(1) accompanied by a
copy of any statement given under subsection 30.11(9) that contains rea-
sons that purport to be based on a law that applies to the foreign state;
and
(c) any determination made under subsection 30.12(3) that the reasons
contained in a statement given under subsection 30.11(9) are well-
founded.
(2) Terms and conditions — An order made under subsection (1) may in-
clude any terms or conditions that the judge considers desirable, after having
considered any representations of the Minister of Justice, the Commissioner,
the person who produced any record or thing to the person designated under
paragraph 30.11(2)(c) and any person who claims to have an interest in any
record or thing so produced, including terms and conditions
(a) necessary to give effect to the request mentioned in subsection 30.1(1);
(b) in respect of the preservation and return to Canada of any record or
thing so produced; and
(c) in respect of the protection of the interests of third parties.
(3) Further execution — The execution of an order made under subsection
30.11(1) that was not completely executed because of a refusal, by reason of a
law that applies to the foreign state, to answer one or more questions or to
produce certain records or things to the person designated under paragraph
30.11(2)(c) may be continued, unless a ruling has already been made on the
objection under paragraph 30.11(8)(a), if a court of the foreign state or a per-
son designated by the foreign state determines that the reasons are not well-
founded and the foreign state so advises the Minister of Justice.
(4) Leave of judge required — No person named in an order made under
subsection 30.11(1) whose reasons for refusing to answer a question or to pro-
duce a record or thing are determined not to be well-founded, or whose objec-
tion has been ruled against under paragraph 30.11(8)(a), shall, during the con-
tinued execution of the order or ruling, refuse to answer that question or to
produce that record or thing to the person designated under paragraph
62
Part III — Mutual Legal Assistance S. 30.16(1)(a)
30.11(2)(c), except with the permission of the judge who made the order or
ruling or another judge of the same court.
2002, c. 16, s. 3
Commentary
Act
Where a refusal to answer a question is based on the law of the foreign state, the Canadian
court may order the continuation of an examination, and that the question be answered if a
court of the foreign state advises the Minister of Justice that the reasons for the refusal are
not well-founded by the laws of the foreign state (s. 30.13(3)). A judge may order that the
transcripts or records of the examination, and any statement that contains reasons that pur-
port to be based on the law of the foreign state be sent to the foreign state for the purpose of
its determination.
30.14 Terms and conditions — No record or thing that has been ordered
under section 30.13 to be sent to the foreign state mentioned in subsection
30.1(1) shall be so sent until the Minister of Justice is satisfied that the foreign
state has agreed to comply with any terms or conditions imposed in respect of
the sending abroad of the record or thing.
2002, c. 16, s. 3
30.15 (1) Approval of request to obtain evidence by video link,

etc. — If the Minister of Justice approves a request of a foreign state to com-
pel a person to provide evidence or a statement in respect of conduct that is
the subject of the request by means of technology that permits the virtual pres-
ence of the person in the territory over which the foreign state has jurisdiction,
or that permits the person to be heard and examined, the Minister of Justice
shall provide the Commissioner with any documents or information necessary
to apply for the order.
(2) Application for order — The Commissioner or the authorized repre-
sentative of the Commissioner shall apply ex parte to a judge for an order for
the taking of evidence or a statement from the person.
2002, c. 16, s. 3
Commentary
The Minister of Justice may approve a request of a foreign state to compel a person’s “vir-
tual presence” in the foreign state by means of a video link or similar technology. The Min-
ister of Justice will provide the Commissioner of Competition with the necessary informa-
tion to make an ex parte application to a judge of the superior court.
30.16 (1) Order for video link, etc. — A judge to whom an application is
made under subsection 30.15(2) may make an order for the taking of evidence
or a statement from a person where the judge is satisfied that there are rea-
sonable grounds to believe that
ing place, has taken place or is about to take place; and
63
(b) the foreign state believes that the person’s evidence or statement
would be relevant to the investigation or proceedings in respect of the
conduct referred to in paragraph (a).
(2) Provisions of order — An order made under subsection (1) shall order
the person
(a) to attend at the place fixed by the judge for the taking of the evidence
or statement by means of the technology and to remain in attendance un-
til the person is excused by the authorities of the foreign state;
(b) to answer any questions put to the person by the authorities of the
foreign state or by any person authorized by those authorities;
(c) to make a copy of a record or to make a record from data and to bring
the copy or record, when appropriate; and
(d) to bring any record or thing in his or her possession or control, when
appropriate, in order to show it to the authorities by means of the
technology.
(3) Order effective throughout Canada — An order made under sub-
section (1) may be executed anywhere in Canada.
(4) Terms and conditions of order — An order made under subsection
(1) may include any terms or conditions that the judge considers desirable,
including those relating to the protection of the interests of the person named
in it and of third parties.
(5) Variation — The judge who made the order under subsection (1) or an-
other judge of the same court may vary its terms and conditions.
(6) Expenses — A person named in an order made under subsection (1) is
entitled to be paid the travel and living expenses to which the person would be
entitled if the person were required to attend as a witness before the judge
who made the order.
2002, c. 16, s. 3
Commentary
The judge may grant the “virtual presence” order where there are reasonable grounds to
believe that:
• the conduct that is the subject of the request by the foreign state is taking place, has
taken place or will take place; and
• the foreign state believes that the person’s evidence would be relevant to the investiga-
tion in respect of the conduct.
The order is executable throughout Canada and may be subject to the terms and conditions
the judge considers desirable, including those relating to the protection of the interests of a
person named in the order and of third parties.
30.17 (1) Other laws to apply — When a person gives evidence or a state-
ment pursuant to an order made under subsection 30.16(1), the person shall
64
give the evidence or statement as though he or she were physically before the
court or tribunal outside Canada, in accordance with the laws of evidence and
procedure applicable to that court or tribunal, but may refuse to give evidence
or a statement, in whole or in part, if giving the evidence or statement would
disclose information that is protected by the Canadian law of non-disclosure of
Act
information or privilege.
(2) Statement of reasons for refusal — A person named in an order
made under subsection 30.16(1) who refuses to give evidence or a statement on
the grounds that it would disclose information that is protected by the Cana-
dian law of non-disclosure of information or privilege shall, within seven days,
give to the judge who made the order or another judge of the same court a
detailed statement in writing of the reasons on which the person bases each
refusal.
(3) Refusals — A judge to whom a statement is given under subsection (2)
shall determine whether the reasons for refusal are well-founded and, if the
judge determines that they are not, the judge shall order that the person
named in the order made under subsection 30.16(1) give the evidence or
statement.
(4) Contempt of court in Canada — When a witness gives evidence
under section 30.16, the Canadian law relating to contempt of court applies
with respect to a refusal by the person to answer a question or to produce a
record or thing as ordered by the judge under that section.
2002, c. 16, s. 3
Commentary
A person giving evidence pursuant to an order requiring a “video link” does so subject to the
laws of evidence and procedure of the foreign state; however, the person may still refuse to
answer questions on the basis of Canadian laws of non-disclosure or privilege. Refusals to
answer questions on the basis of Canadian law are dealt with by a Canadian judge according
to the same procedure used in “evidence-gathering” orders under ss. 30.11 to 30.14. Destroy-
ing or altering information required to be produced by the order is an offence punishable on
summary conviction by a fine of up to $25,000 and/or imprisonment up to two years or, on
indictment, by a fine of up to $50,000 and/or up to five years’ imprisonment (s. 65.1(2)).
Canadian laws of contempt will apply to a person who refuses to obey a court order requir-
ing that a question be answered or a record be produced. The contempt law, however, only
applies in the case of “video link” orders, but not in the case of “evidence-gathering” orders
under s. 30.11.
30.18 (1) Arrest warrant — The judge who made the order under subsection
30.11(1) or 30.16(1) or another judge of the same court may issue a warrant
for the arrest of the person named in the order where the judge is satisfied, on
an information in writing and under oath or solemn declaration, that
(a) the person did not attend or remain in attendance as required by the
order or is about to abscond;
65
(b) the order was personally served on the person; and

(c) in the case of an order made under subsection 30.11(1), the person is
likely to give material evidence and, in the case of an order made under
subsection 30.16(1), the foreign state believes that the testimony of the
person would be relevant to the investigation or proceedings in respect of
the conduct.
(2) Warrant effective throughout Canada — A warrant issued under
subsection (1) may be executed anywhere in Canada by any peace officer.
(3) Order — A peace officer who arrests a person in execution of a warrant
issued under subsection (1) shall, without delay, bring the person or cause the
person to be brought before the judge who issued the warrant or another
judge of the same court who may, to ensure compliance with the order made
under subsection 30.11(1) or 30.16(1), order that the person be detained in cus-
tody or issue a “release order”, as defined in section 2 of the Criminal Code,
the form of which may be adapted to suit the circumstances.
(4) Copy of information — A person who is arrested in execution of a war-
rant issued under subsection (1) is entitled to receive, on request, a copy of the
information on which the warrant was issued.
2002, c. 16, s. 3; 2019, c. 25, s. 387
Commentary
In the case of “evidence-gathering” orders under s. 30.11(1) or “video link” orders under s.
30.16(1), an arrest warrant may issue where the judge is satisfied that:
• the order was served personally on the person;
• the person did not attend as ordered, or is about to abscond; and
• the person has evidence that is material or relevant to the investigation or proceedings.
The warrant may be executed anywhere in Canada by any peace officer.
Lending Exhibits
30.19 (1) Approval of loan request — If the Minister of Justice approves

a request of a foreign state under an agreement to have an exhibit that was
admitted in evidence in a proceeding in respect of an offence in a court in
Canada or in a proceeding before the Tribunal lent to the foreign state, the
Minister shall provide the Commissioner with any documents or information
necessary to apply for a loan order.
(2) Application for loan order — The Commissioner or the authorized
representative of the Commissioner shall apply for a loan order in respect of
the exhibit to the court that has possession of the exhibit, or to the Tribunal if
66
it has possession of the exhibit, after having given reasonable notice to the par-
ties to the proceedings and to
(a) to the Attorney General of Canada, in the case of an application to the
Federal Court or the Federal Court of Appeal;
(b) the attorney general of the province in which the exhibit is located, in
Act
the case of an application to a court other than the Federal Court or the
Federal Court of Appeal; or
(c) the Chairman of the Tribunal, in the case of an application to the
Tribunal.
(3) Contents of application — An application made under subsection (2)
must
(a) contain a description of the exhibit requested to be lent;
(b) designate a person or class of persons to whom the exhibit is sought to
be given;
(c) state the reasons for the request and, if any tests are sought to be per-
formed on the exhibit, contain a description of the tests and a statement of
the place where they will be performed;
(d) state the place or places to which the exhibit is sought to be removed;
and
(e) specify the time at or before which the exhibit is to be returned.
2002, c. 8, s. 198(a), (b); 2002, c. 16, s. 3
Commentary
A foreign state may request the loan of an exhibit admitted as evidence in a proceeding
before a Canadian court or the Competition Tribunal. The Minister of Justice, upon approv-
ing the request, provides the Commissioner of Competition with the necessary information
to apply to the court in possession of the exhibit or to the Tribunal, as the case may be.
Unlike the other application procedures for orders under the Act, an application for a “lend-
ing exhibit” order is not made ex parte but rather on reasonable notice given to the parties to
the original proceedings, the Attorney General of Canada, the attorney general of the prov-
ince in which the exhibit is located, and the Chair of the Tribunal, in the case of an applica-
tion to the Tribunal.
30.2 (1) Making of loan order — If the court or the Tribunal, as the case
may be, is satisfied that the foreign state has requested the loan for a fixed
period and has agreed to comply with the terms and conditions that the court
or Tribunal proposes to include in any loan order, the court or Tribunal may,
after having considered any representations of the persons to whom notice of
the application was given in accordance with subsection 30.19(2), make a loan
order.
(2) Terms of loan order — A loan order made under subsection (1) must
(a) contain a description of the exhibit;
67
(b) order the person who has possession of the exhibit to give it to a per-
son designated in the order or who is a member of a class of persons so
designated;
(c) contain a description of any tests authorized to be performed on the
exhibit, as well as a statement of the place where the tests must be
performed;
(d) fix the place or places to which the exhibit may be removed; and
(e) fix the time at or before which the exhibit must be returned.
(3) Terms and conditions — A loan order made under subsection (1) may
include any terms or conditions that the court or the Tribunal considers desir-
able, including those relating to the preservation of the exhibit.
2002, c. 16, s. 3
Commentary
The Court or the Competition Tribunal, as the case may be, may make the loan order where
they are satisfied that the loan is for a fixed period and that the foreign state has agreed to
comply with the terms and conditions of the order. The Tribunal or the Court may include
such terms and conditions as they consider desirable, including those relating to the preser-
vation of the exhibit.
30.21 Variation of loan order — A court or the Tribunal may vary the
terms and conditions of any loan order made by it.
2002, c. 16, s. 3
30.22 Copy of order to custodian — A copy of a loan order and of an

order varying it shall be delivered by the Commissioner to the Minister of
Justice and to the person who had possession of the exhibit when the loan or-
der was made.
2002, c. 16, s. 3
30.23 Presumption of continuity — The burden of proving that an ex-

hibit lent to a foreign state pursuant to a loan order made under subsection
30.2(1) and returned to Canada is not in the same condition as it was when the
loan order was made or that it was tampered with after the loan order was
made is on the party who makes that allegation and, in the absence of that
proof, the exhibit is deemed to have been continuously in the possession of the
court that made the loan order or the Tribunal, as the case may be.
2002, c. 16, s. 3
Commentary
Under s. 30.23, there is a presumption of continuity regarding the loaned exhibit, and hence
a party who alleges that a loaned exhibit was tampered with after the loan order was made,
or has been returned in an altered condition bears the onus of proving the allegation. In the
absence of such proof, the exhibit is presumed to have been continuously in the possession
of the Court or Competition Tribunal that made the loan order.
68
Part III — Mutual Legal Assistance S. 30.26(1)
Appeal
30.24 (1) Appeal on question of law — An appeal lies, with leave, on a

question of law alone, to the court of appeal, within the meaning of section 2 of
Act
the Criminal Code, from an order or decision of a judge or a court in Canada
made under this Part, other than an order or decision of the Federal Court or
a judge of that Court, if the application for leave to appeal is made to a judge
of the court of appeal within fifteen days after the order or decision.
(2) Appeal on question of law — An appeal lies, with leave, on a question
of law alone, to the Federal Court of Appeal, from any order or decision of the
Federal Court or the Tribunal made under this Part, if the application for
leave to appeal is made to a judge of that Court within fifteen days after the
order or decision.
2002, c. 8, s. 198(c)(ii); 2002, c. 16, s. 3
Commentary
With respect to an appeal from an order or decision of a judge or court under Part III, the
only ground of appeal is on a question of law, and there is no appeal on questions of fact or
mixed questions of fact and law. The decisions of provincial courts may be appealed to the
court of appeal of the province. Appeals from the Competition Tribunal or the Federal Court
(Trial Division) are to the Federal Court of Appeal.
Evidence Obtained by Canada from Abroad

30.25 Evidence — The Minister of Justice shall, on receiving evidence sent

by a foreign state in response to a request made by Canada under an agree-
ment, send it promptly to the Commissioner.
2002, c. 16, s. 3
Commentary
In addition to responding to requests from foreign governments, the Government of Canada
may also request the assistance of foreign governments. Where the Minister of Justice re-
ceives evidence from a foreign government in response to a request, he or she must send it
promptly to the Commissioner of Competition.
30.26 (1) Foreign records — In a proceeding in respect of which Parlia-

ment has jurisdiction, a record or a copy of a record and any affidavit, certifi-
cate or other statement pertaining to the record made by a person who has
custody or knowledge of the record, sent to the Minister of Justice by a foreign
state in accordance with a Canadian request under an agreement, is not inad-
missible in evidence by reason only that a statement contained in it is hearsay
or a statement of opinion.
69
(2) Probative value — For the purpose of determining the probative value
of a record or a copy of a record admitted in evidence under Part VII.1 or
VIII, the court hearing the matter, or the Tribunal in proceedings before it,
may examine the record or copy, receive evidence orally or by affidavit, or by
a certificate or other statement pertaining to the record in which a person at-
tests that the certificate or statement is made in conformity with the laws that
apply to a foreign state, whether or not the certificate or statement is in the
form of an affidavit attested to before an official of the foreign state, including
evidence as to the circumstances in which the information contained in the
record or copy was written, stored or reproduced, and may draw any reasona-
ble inference from the form or content of the record or copy.
2002, c. 16, s. 3
Commentary
A foreign record is not inadmissible by reason only that it is, or contains, hearsay or a state-
ment of opinion (s. 30.26(1)). In order to determine the “probative value” of a foreign record
admitted in evidence under Part VII.I or VIII, the courts may examine the record itself, re-
ceive evidence orally, by affidavit, or in certificate or statement made in conformity with the
laws of the foreign state attesting to the circumstances in which the record or information
was made (s. 30.26(2)).
30.27 Foreign things — In a proceeding in respect of which Parliament has

jurisdiction, a thing and any affidavit, certificate or other statement pertaining
to the thing made by a person in a foreign state as to the identity and posses-
sion of the thing from the time it was obtained until its sending to the Commis-
sioner by the Minister of Justice in accordance with a Canadian request under
an agreement, are not inadmissible in evidence by reason only that the affida-
vit, certificate or other statement contains hearsay or a statement of opinion.
2002, c. 16, s. 3
Commentary
A foreign thing, and any affidavit, certificate or other statement pertaining to the identity and
possession of the thing is not inadmissible in evidence by reason only that the affidavit,
certificate or other statement contains hearsay or a statement of opinion.
30.28 Status of certificate — An affidavit, certificate or other statement

mentioned in section 30.26 or 30.27 is, in the absence of evidence to the con-
trary, proof of the statements contained in it without proof of the signature or
official character of the person appearing to have signed it.
2002, c. 16, s. 3
70
General
30.29 (1) Confidentiality of foreign requests and evidence — No

person who performs or has performed duties or functions in the administra-
Act
tion or enforcement of this Act shall communicate or allow to be communi-
cated to any other person, except for the purposes of the administration or
enforcement of this Act,
(a) the contents of a request made to Canada from a foreign state or the
fact of the request having been made; or
(b) the contents of any record or thing obtained from a foreign state pur-
suant to a Canadian request.
(2) Confidentiality of Canadian evidence — No person who performs
or has performed duties or functions in the administration or enforcement of
this Act shall communicate or allow to be communicated to any other person,
except to a Canadian law enforcement agency or for the purposes of the ad-
ministration or enforcement of this Act, any information obtained under sec-
tion 30.06 or 30.11.
that has been made public.
2002, c. 16, s. 3
Commentary
A person who deals in the administration or enforcement of the Act is prohibited from com-
municating or allowing to be communicated the contents of a request, the fact that a request
has been made, or the contents of any record or thing obtained by a foreign state from Can-
ada (s. 30.29(1)). Similarly, no one may communicate or allow to be communicated any
information obtained by Canada pursuant to a search warrant or an evidence-gathering order
(s. 30.29(2)). The rule does not apply to information that has been made public (s. 30.29(3)).
30.291 (1) Records or other things already in Commissioner’s pos-

session — For greater certainty, any evidence requested by a foreign state
under an agreement may be obtained for the purposes of giving effect to the
request only in accordance with the agreement and the procedure set out in
this Part, even in the case of records or other things already in the possession
of the Commissioner.
that has been made public or any information the communication of which
was authorized by the person who provided the information.
2002, c. 16, s. 3
30.3 Preservation of informal arrangements — Nothing in this Part

shall be construed so as to abrogate or derogate from any arrangement or
71
agreement, other than an agreement under this Part, in respect of cooperation

between the Commissioner and a foreign authority.
2002, c. 16, s. 3
Commentary
Part III does not abrogate or derogate from any existing arrangement or agreement between
the Commissioner of Competition and a foreign authority.
PART IV — SPECIAL REMEDIES (SS. 31–36)

31. Reduction or removal of customs duties — Whenever, as a result
of an inquiry under this Act, a judgment of a court or a decision of the Tribu-
nal, it appears to the satisfaction of the Governor in Council that
(a) competition in respect of any article has been prevented or lessened
substantially, and
(b) the prevention or lessening of competition is facilitated by customs du-
ties imposed on the article, or on any like article, or can be reduced by a
removal or reduction of customs duties so imposed,
the Governor in Council may, by order, remove or reduce any such customs
duties.
R.S.C. 1985, c. 19 (2nd Supp.), s. 27
Case Law
Proprietary Articles Trade Assn. v. A.G. Can., [1931] A.C. 310, [1931] 1 W.W.R. 552, 55
C.C.C. 241, [1931] 2 D.L.R. 1 (P.C.). (See also entry under s. 32.) — Section 29 [now s. 31]
is intra vires Parliament as being reasonably ancillary to its taxation power (ss. 91(3) and
122, Constitution Act, 1867).
32. (1) Powers of Federal Court where certain rights used to

restrain trade — In any case where use has been made of the exclusive
rights and privileges conferred by one or more patents for invention, by one or
more certificates of supplementary protection issued under the Patent Act, by
one or more trademarks, by a copyright or by a registered integrated circuit
topography, so as to
(a) limit unduly the facilities for transporting, producing, manufacturing,
supplying, storing or dealing in any article or commodity that may be a
subject of trade or commerce,
(b) restrain or injure, unduly, trade or commerce in relation to any such
article or commodity,
(c) prevent, limit or lessen, unduly, the manufacture or production of any
such article or commodity or unreasonably enhance the price thereof, or
72
Part IV — Special Remedies (ss. 31–36) S. 32
(d) prevent or lessen, unduly, competition in the production, manufac-

ture, purchase, barter, sale, transportation or supply of any such article
or commodity,
the Federal Court may make one or more of the orders referred to in subsec-
tion (2) in the circumstances described in that subsection.
Act
(2) Orders — The Federal Court, on an information exhibited by the Attor-
ney General of Canada, may, for the purpose of preventing any use in the
manner defined in subsection (1) of the exclusive rights and privileges con-
ferred by any patents for invention, certificates of supplementary protection
issued under the Patent Act, trademarks, copyrights or registered integrated
circuit topographies relating to or affecting the manufacture, use or sale of any
article or commodity that may be a subject of trade or commerce, make one or
more of the following orders:
(a) declaring void, in whole or in part, any agreement, arrangement or
licence relating to that use;
(b) restraining any person from carrying out or exercising any or all of
the terms or provisions of the agreement, arrangement or licence;
(c) directing the grant of licences under any such patent, certificate of
supplementary protection, copyright or registered integrated circuit to-
pography to the persons and on the terms and conditions that the court
may deem proper or, if the grant and other remedies under this section
would appear insufficient to prevent that use, revoking the patent or cer-
tificate of supplementary protection;
(d) directing that the registration of a trademark in the register of trade-
marks or the registration of an integrated circuit topography in the regis-
ter of topographies be expunged or amended; and
(e) directing that such other acts be done or omitted as the Court may
deem necessary to prevent any such use.
(3) Treaties, etc. — No order shall be made under this section that is at va-
riance with any treaty, convention, arrangement or engagement respecting
patents, certificates of supplementary protection, trademarks, copyrights or
integrated circuit topographies to which Canada is a party.
R.S.C. 1985, c. 10 (4th Supp.), s. 18; 1990, c. 37, s. 29; 2014, c. 20, s. 366(1); 2017, c.
6, s. 123
Commentary
Additional information on the Competition Bureau’s approach to the enforcement of these
provisions may be found in Intellectual Property Enforcement Guidelines (Ottawa: Competi-
tion Bureau, March 2019) at paragraph 6.3, where it notes that enforcement under section 32
would occur “only in the very rare circumstances described in this document and when the
conduct cannot be remedied by the relevant [intellectual property] statute”.
73
Case Law
Society of Composers, Authors & Music Publishers of Canada v. Landmark Cinemas of
Canada Ltd. (1992), 45 C.P.R. (3d) 346, 60 F.T.R. 161 (T.D.) — If the activity complained
of is expressly authorized by federal legislation, then it is exempt from the operation of s. 32
of the Act. Thus, in an action alleging copyright infringement, a pleading that the quantum of
royalties certified by the Copyright Board constituted a restraint of trade contrary to s. 32 of
the Competition Act was ordered struck, as the Board’s activities fell within its explicit legis-
lative mandate as set out in the Copyright Act, R.S.C. 1985, c. C-42.
Genentech Canada Inc., Re (1992), 44 C.P.R. (3d) 316 (Can. Patented Medicine Prices Re-
view Bd.); stay granted (1992), (sub nom. Genentech Inc. v. Canada (Patented Medicine
Prices Review Bd.)) 44 C.P.R. (3d) 335 (Fed. T.D.) — A retrospective public dedication of a
patent does not preclude the making of an order under s. 32 of the Act.
Proprietary Articles Trade Assn. v. A.G. Can., [1931] A.C. 310, [1931] 1 W.W.R. 552, 55
C.C.C. 241, [1931] 2 D.L.R. 1 (P.C.). (See also entry under s. 31.) — Section 30 [now s. 32]
is intra vires Parliament as reasonably ancillary to its power to legislate in relation to patents
of invention and discovery (s. 91(2) Constitution Act, 1867).
33. (1) Interim injunction — On application by or on behalf of the Attorney

General of Canada or the attorney general of a province, a court may issue an
interim injunction forbidding any person named in the application from doing
any act or thing that it appears to the court could constitute or be directed
toward the commission of an offence under Part VI — other than an offence
under section 52 involving the use of any means of telecommunication or an
offence under section 52.01, 52.1 or 53 — or under section 66, pending the
commencement or completion of a proceeding under subsection 34(2) or a
prosecution against the person, if it appears to the court that
(a) the person has done, is about to do or is likely to do any act or thing
constituting or directed toward the commission of the offence; and
(b) if the offence is committed or continued,
(i) injury to competition that cannot adequately be remedied under
any other provision of this Act will result, or
(ii) serious harm is likely to ensue unless the injunction is issued and
the balance of convenience favours issuing the injunction.
(1.1) Injunction — offences involving telecommunication — On ap-
plication by or on behalf of the Attorney General of Canada or the attorney
general of a province, a court may issue an injunction forbidding any person
named in the application from doing any act or thing that it appears to the
court could constitute or be directed toward the commission of an offence
under section 52 involving the use of any means of telecommunication or an
offence under section 52.01, 52.1 or 53, if it appears to the court that
(a) the person has done, is about to do or is likely to do any act or thing
constituting or directed toward the commission of the offence;
(b) if the offence is committed or continued, serious harm is likely to en-
sue unless the injunction is issued; and
74
Part IV — Special Remedies (ss. 31–36) S. 33(5)(a)
(c) the balance of convenience favours issuing the injunction.

(1.2) Injunction against third parties — offences involving tele-
communication — On application by or on behalf of the Attorney General
of Canada or the attorney general of a province, a court may issue an injunc-
tion ordering any person named in the application to refrain from supplying
Act
to another person a product that it appears to the court is or is likely to be
used to commit or continue an offence under section 52 involving the use of
any means of telecommunication or an offence under section 52.01, 52.1 or 53,
or to do any act or thing that it appears to the court could prevent the commis-
sion or continuation of such an offence, if it appears to the court that
(a) a person has done, is about to do or is likely to do any act or thing
constituting or directed toward the commission of the offence;
(b) if the offence is committed or continued, serious harm is likely to en-
sue unless the injunction is issued; and
(c) the balance of convenience favours issuing the injunction.
(2) Notice of application — Subject to subsection (3), at least 48 hours’
notice of an application for an injunction under subsection (1), (1.1) or (1.2)
shall be given by or on behalf of the Attorney General of Canada or the attor-
ney general of a province, as the case may be, to each person against whom the
injunction is sought.
(3) Ex parte application — If a court to which an application is made
under subsection (1), (1.1) or (1.2) is satisfied that subsection (2) cannot rea-
sonably be complied with, or that the urgency of the situation is such that ser-
vice of notice in accordance with subsection (2) would not be in the public
interest, it may proceed with the application ex parte but any injunction issued
under subsection (1), (1.1) or (1.2) by the court on ex parte application has
effect only for the period, not exceeding 10 days, that is specified in the order.
(4) Terms of injunction — An injunction issued under subsection (1), (1.1)
or (1.2)
(a) shall be in the terms that the court that issues it considers necessary
and sufficient to meet the circumstances of the case; and
(b) subject to subsection (3), has effect for the period that is specified in
the order.
(5) Extension or cancellation of injunction — On application by or on
behalf of the Attorney General of Canada or the attorney general of a prov-
ince, as the case may be, or by or on behalf of any person to whom the injunc-
tion is directed, on at least 48 hours’ notice of the application to all other par-
ties to the injunction, a court that issues an injunction under subsection (1),
(1.1) or (1.2) may, by order,
(a) despite subsections (3) and (4), continue the injunction, with or with-
out modification, for any definite period that is specified in the order; or
75
(b) revoke the injunction.

(6) Duty of applicant — If an injunction is issued under subsection (1), (1.1)
or (1.2), the Attorney General of Canada or the attorney general of a province,
as the case may be, shall proceed as expeditiously as possible to institute and
conclude any prosecution or proceedings arising out of the acts or things on
the basis of which the injunction was issued.
(7) Punishment for disobedience — A court may punish any person
who contravenes an injunction issued by it under subsection (1), (1.1) or (1.2)
by a fine in the discretion of the court or by imprisonment for a term not
exceeding two years.
(8) Definition of “court” — In this section, “court” means the Federal
Court or a superior court of criminal jurisdiction as defined in the Criminal
Code.
1993, c. 34, s. 50; 1999, c. 2, s. 10; 2002, c. 16, s. 5; 2010, c. 23, s. 73
Commentary
Section 33 allows courts to issue interim injunctions to halt the operations of suspected
fraudulent telemarketers. Injunctions can also be issued, pursuant to subsection 33(1.1),
against third parties such as telephone companies providing services to businesses or persons
who have been previously convicted of deceptive telemarketing.
With the addition in 2002 of s. 53, which created the criminal offence of deceptive prize
notices, s. 33 was amended to permit the Attorney-General of Canada or the attorney-general
of a province to apply to a court for an interim injunction forbidding any person or corpora-
tion from doing any act directed toward the commission of an offence under s. 53. Subsec-
tion 33(1.1) also allows an injunction that has been issued in respect of deceptive telemarket-
ing or contests to forbid the supplying to another person of a product that is likely to be used
for the commission of such offences.
Case Law
Tele-Mobile Co., A Partnership v. Bell Mobility Inc., 46 C.P.R. (4th) 146 (B.C.S.C. [In
Chambers]); additional reasons at 2006 CarswellBC 2462 (B.C.S.C. [In Chambers]); addi-
tional reasons at 2006 CarswellBC 2482 (B.C.S.C. [In Chambers]) — Where the defendant
has stated his intention not to engage in the conduct that aggrieves the victim, any claim for
irreparable harm is speculative and cannot justify the extraordinary remedy of an injunction.
A.G. Can. v. Fleet Aerospace Corp. (1985), 5 C.P.R. (3d) 470, 21 C.C.C. (3d) 180
(F.C.T.D.) — The Attorney General must present clear and cogent, reasonable and probable
grounds supported by evidence for an injunction pursuant to s. 29.1 [now s. 33]. Dismissal of
an application for an injunction because of failure to establish such grounds is procedural,
and does not preclude a further application based on better evidence.
34. (1) Prohibition orders — Where a person has been convicted of an of-
fence under Part VI, the court may, at the time of the conviction, on the appli-
cation of the Attorney General of Canada or the attorney general of the prov-
ince, in addition to any other penalty imposed on the person convicted,
prohibit the continuation or repetition of the offence or prohibit the doing of
76
Part IV — Special Remedies (ss. 31–36) S. 34(3)(b)
any act or thing, by the person convicted or any other person, that is directed
toward the continuation or repetition of the offence.
(2) Idem — Where it appears to a superior court of criminal jurisdiction in
proceedings commenced by information of the Attorney General of Canada or
the attorney general of the province for the purposes of this section that a per-
Act
son has done, is about to do or is likely to do any act or thing constituting or
directed toward the commission of an offence under Part VI, the court may
prohibit the commission of the offence or the doing or continuation of any act
or thing by that person or any other person constituting or directed toward
the commission of the offence.
(2.1) Prescriptive terms — An order made under this section in relation to
an offence may require any person
(a) to take such steps as the court considers necessary to prevent the com-
mission, continuation or repetition of the offence; or
(b) to take any steps agreed to by that person and the Attorney General of
Canada or the attorney general of the province.
(2.2) Duration of order — An order made under this section applies for a
period of ten years unless the court specifies a shorter period.
(2.3) Variation or rescission — An order made under this section may be
varied or rescinded in respect of any person to whom the order applies by the
court that made the order
(a) where the person and the Attorney General of Canada or the attorney
general of the province consent to the variation or rescission; or
(b) where the court, on the application of the person or the Attorney Gen-
eral of Canada or the attorney general of the province, finds that the cir-
cumstances that led to the making of the order have changed and, in the
circumstances that exist at the time the application is made, the order
would not have been made or would have been ineffective in achieving its
intended purpose.
(2.4) Other proceedings — No proceedings may be commenced under Part
VI against a person against whom an order is sought under subsection (2) on
the basis of the same or substantially the same facts as are alleged in proceed-
ings under that subsection.
(3) Appeals to courts of appeal and Federal Court — The Attorney
General of Canada or the attorney general of the province or any person
against whom an order is made under this section may appeal against the or-
der or a refusal to make an order or the quashing of an order
(a) from a superior court of criminal jurisdiction in the province to the
court of appeal of the province, or
(b) from the Federal Court to the Federal Court of Appeal,
77
as the case may be, on any ground that involves a question of law or, if leave to
appeal is granted by the court appealed to within twenty-one days after the
judgment appealed from is pronounced or within such extended time as the
court appealed to or a judge thereof for special reasons allows, on any ground
that appears to that court to be a sufficient ground of appeal.
(3.1) Appeals to Supreme Court of Canada — The Attorney General of
Canada or the attorney general of the province or any person against whom
an order is made under this section may appeal against the order or a refusal
to make an order or the quashing of an order from the court of appeal of the
province or the Federal Court of Appeal, as the case may be, to the Supreme
Court of Canada on any ground that involves a question of law or, if leave to
appeal is granted by the Supreme Court, on any ground that appears to that
Court to be a sufficient ground of appeal.
(4) Disposition of appeal — Where the court of appeal or the Supreme
Court of Canada allows an appeal, it may quash any order made by the court
appealed from, and may make any order that in its opinion the court appealed
from could and should have made.
(5) Procedure — Subject to subsections (3) and (4), Part XXI of the Criminal
Code applies with such modifications as the circumstances require to appeals
under this section.
(6) Punishment for disobedience — A court may punish any person
who contravenes an order made under this section by a fine in the discretion
of the court or by imprisonment for a term not exceeding five years.
(7) Procedure — Any proceedings pursuant to an information of the Attor-
ney General of Canada or the attorney general of a province under this section
shall be tried by the court without a jury, and the procedure applicable in
injunction proceedings in the superior courts of the province shall, in so far as
possible, apply.
(8) Definition of “superior court of criminal jurisdiction” — In this
section “superior court of criminal jurisdiction” means a superior court of
criminal jurisdiction as defined in the Criminal Code.
R.S.C. 1985, c. 19 (2nd Supp.), s. 28; R.S.C. 1985, c. 34 (3rd. Supp.), s. 8; 1999, c. 2, s.
11; 2002, c. 8, s. 183(1)(f); 2009, c. 2, s. 409
Commentary
Prohibition orders are a unique remedy under the Competition Act. Unlike interim injunctive
proceedings pursuant to s. 33 which require that upon the issuing of an injunction, the prose-
cution or proceeding be proceeded with as expeditiously as possible, prohibition orders may
be issued pursuant to subs. 34(2) without any requirement that prosecution for a substantive
offence under the Act take place. Of course, it is also possible under subs. 34(1) that a prohi-
bition order is issued after conviction.
In fact, prohibition orders pursuant to subs. 34(2) without any prosecution for a substantive
offence are common. Often such prohibition orders are consented to by the persons subject
78
to such an order to avoid the expense and opprobrium which a full scale prosecution and
ultimate conviction would entail. The Crown might also seek a prohibition order without
prosecution where the illegality of the conduct is uncertain or where there are other mitigat-
ing circumstances.
Note that prohibition orders whether under subs. (1) or (2) may prohibit the repetition of the
offence or acts or things “... directed toward the commission of the offence...”. Prohibition
Act
orders may thus vary in their detail from simple enjoinders not to commit or repeat the
offence to detailed requirements prohibiting parties subject to the order from engaging in
very specific acts or conduct otherwise legitimate, but prohibited because they are (alleg-
edly) directed towards an offence.
Another unusual feature of prohibition orders is that they can enjoin persons other than the
accused or the defendant. It has been held that these “other persons” must have some con-
nection to the accused. They are usually officers, directors, agents and/or employees. It is
doubtful whether such orders against “other persons” would be binding against them where
they have not received individual notice of such orders such that they can make their own
representations to the court in respect thereof.
Note that the remedy for violation of a prohibition order is found in subs. 34(6) which pro-
vides for a fine or imprisonment for a term not exceeding five years.
Prohibition orders should be distinguished from the entering into of “undertakings”, a prac-
tice which has developed whereunder in lieu of prosecution of a criminal offence or proceed-
ings in respect of a reviewable trade practice, persons agree to engage or not to engage in
certain behaviour. “Undertakings” are not specifically authorized or mentioned in the Act.
Probably the remedy for violation of an undertaking is contractual. They are similar to con-
sent prohibition orders in the function that they serve. Because they are completely outside
the purview of the Act they are inherently more flexible in terms of their contents. However,
the penalty for violation is not as severe as for violation of a prohibition order.
See also paragraph 74.1(1)(a), which permits a similar remedy with respect to deceptive
marketing practices.
The Competition Tribunal has a similar ability to make prohibition orders in connection with
the civil reviewable practices of tied selling, exclusive dealing, market restriction (section
77) and abuse of dominance (section 79). In addition, section 105 of the Act permits parties
to enter into a consent agreement that, once registered, has the force of a Tribunal order. A
consent agreement could prohibit a party from engaging in certain conduct.
For a commentary on prohibition orders in the criminal and civil contexts, see Mark J. Nich-
olson, Yana Ermak and Nicole Washington, “‘Criminals’ Get A Better Deal: The Statutory
Double Standard For Prohibition Orders in Criminal Matters vs. Reviewable Matters under
the Competition Act”, presented at the CBA Competition Law Section’s 2010 Annual Fall
Competition Law Conference, 30 September-l October 2010.
Case Law
R. v. S.S. Kresge Co. (1975), 25 C.P.R. (2d) 16, 27 C.C.C. (2d) 420, 8 Nfld. & P.E.I.R. 415,
65 D.L.R. (3d) 628 (P.E.I. C.A.) — Since a summary conviction court is not “a superior
court of criminal jurisdiction in the province” s. 30(3) [now s. 34(3)] does not apply to ap-
peals from a prohibition order made by a summary conviction court under s. 30(1) [now s.
34(1)] and consequently such appeals are not restricted to questions of law. The Crown had
elected to proceed by way of summary conviction. The accused had pleaded guilty and made
restitution. These and other circumstances surrounding the commission of the offence did
not justify a prohibition order.
79
R. v. Ameublements Leger Inc. (1975), 26 C.P.R. (2d) 130 (Que. S.P.) — Sections 30(1)(b)
[now s. 34(1)(b)] and 30(7) [now s. 34(7)] do not constitute compulsory procedure, and their
provisions do not apply to s. 30(1)(a) [now s. 34(1)(a)] and s. 30(6) [now s. 34(6)]. The
legislature intended to leave it to the discretion of the prosecution to submit a case either to a
superior court of criminal jurisdiction or a lower court.
Subsection (1)
R. v. Rolex Watch Co. of Can. (1980), 50 C.P.R. (2d) 222, 53 C.C.C. (2d) 445 (Ont. C.A.).
(See also entries under ss. 61(1)(a) and 69.) — The substance of s. 38(1)(a) [now s. 61(1)(a)]
is the same as the former s. 38(2)(a) [re-en. 1974–75–76, c. 76, s. 18(1)] and accordingly an
order may issue under s. 30(1) [now s. 34(1)] prohibiting an accused convicted of an offence
under the former s. 38(2)(a) from continuing or repeating the offence.
R. v. Levi Strauss of Can. Inc. (1979), 45 C.P.R. (2d) 215 (Ont. Co. Ct.). (See also entry
under s. 61(1).) — The accused had come under new corporate direction since the offences
under s. 38(1) [now s. 61(1)] were committed, its policies had undergone a radical change
for the better, and there was no likelihood of a repetition of the illegal conduct. A prohibition
order was accordingly not made.
R. v. Bidwell Food Processors Ltd. (1976), 29 C.P.R. (2d) 266 (Man. Q.B.). (See also entry
under s. 52.) — The corporate accused had sold all its assets, and the Crown would have
remedies for at least three years under s. 30 [now s. 34]. The individual accused were no
longer in the business and had no intentions of being in the business again. Therefore prohi-
bition orders were not issued.
R. v. Kito Can. Ltd., [1976] 4 W.W.R. 189, 25 C.P.R. (2d) 145, 30 C.C.C. (2d) 531 (Man.
C.A.). (See also entry under s. 61.) — A prohibition order should not be made without evi-
dence of a likelihood of a continuing breach by the company and should not be made against
individuals without notice of the application. The company had already ceased to carry on its
business, and accordingly the order was denied.
R. v. Family Tire Centres Ltd. (1975), 25 C.P.R. (2d) 219, 28 C.C.C. (2d) 474 (Ont. C.A.) —
The accused’s advertising indicated that a person buying one tire for list price could have a
second for 1 cent. In the ordinary course of business the accused sold tires for about one half
the list price, using them as a loss leader. The advertisement was therefore untrue, deceptive
or misleading under s. 36(1)(a) [now s. 52(1)(a)]. The accused’s sales were $3 M gross, 50
per cent being for tire sales on which it made no net profit. Deterrence and protection of the
public are major concerns in sentencing. A $5,000 fine was appropriate. A prohibition order
was also appropriate, since the illegal practice was the basic reason for the accused’s success
and it was continued at least until the date of conviction.
R. v. Petrofina Can. Ltd. (1974), 20 C.P.R. (2d) 83, 21 C.C.C. (2d) 315 (Ont. Dist. Ct.) —
The accused had committed an offence under s. 38 [now s. 61]. It had terminated a dealer’s
lease due to failure to comply with the accused’s pricing policy, which included granting
subsidies to keep gasoline prices within 2 cents of competitors. Although it had a modest
share of the Canadian market, the accused had sales in the scores of millions. Deterrence of
the accused and other companies, and the crucial importance of the product in the economy,
were important factors in sentencing. A prohibition order was not restricted to sales of the
product to one particular dealer concerned. Although the Crown had not shown the conduct
would probably continue, the company had a policy of price maintenance, and its method of
distribution made it easier to implement such a policy, conduct which a prohibition order
could discourage. A fine of $15,000 was imposed and a prohibition order granted.
80
R. v. F.W. Woolworth Co. (1974), 3 O.R. (2d) 629, 16 C.P.R. (2d) 272, 18 C.C.C. (2d) 23, 46
D.L.R. (3d) 345 (C.A.). (See also entry under s. 52.) — A prohibition order must relate to
the continuation or repetition of the offence for which the conviction was made, and to the
class of goods which were the subject matter of the charge. It is an extraordinary remedy to
be invoked only when no other adequate remedy exists. The evidence ought to show a delib-
erate and flagrant disobedience of the Act, and the likelihood of a continuation or repetition
Act
in the absence of prohibition.
R. v. Consumers Distributing Co. (1973), 12 C.P.R. (2d) 34 (Ont. Prov. Ct.) — The accused,
a large business, committed an offence under s. 36 [now s. 52]. It had misled the public in its
catalogue as to what the public would normally expect to pay for certain items. Fines of
$500 on each of the four counts were imposed. A prohibition order was not issued, as the
particular type of advertising was not repeated in the current catalogue.
Paramount Indust. Inc. v. R. (1973), 10 C.P.R. (2d) 216 (Que. C.A.) — The labels on the
boxes of a model kit stocked by the accused wholesaler contained untrue statements. On
discovering the error, the accused’s president instructed that the words be crossed out. How-
ever, since mens rea is not an element of the offence the accused was guilty of an offence
under s. 36 [now s. 52]. A fine of $500 was appropriate. A prohibition order is similar to an
injunction, and requires a person not to do or to cease doing a specified act, and cannot
extend beyond that specific act or operation. A paragraph in the prohibition order which
went further than this was accordingly struck on appeal.
R. v. Arrow Petroleums Ltd. (1972), 8 C.P.R. (2d) 95 (Ont. Prov. Ct.) — The accused was
convicted of an offence under s. 38 [now s. 61] arising from actions designed to promote the
sale of gasoline by lowering the price. In the short run the public would benefit rather than
suffer, although gasoline station proprietors selling the accused’s products could be placed in
a squeeze situation. Due to a gas war, sales did not increase as a result of the scheme but
rather declined. A fine of $1,500 was imposed. Any prohibition order would have had to be
very broad and difficult to enforce, involving disputes between the accused and its proprie-
tors. Accordingly it was not granted.
R. v. Corning Glass Works of Can. Ltd. (1972), 9 C.P.R. (2d) 69 (Ont. Co. Ct.) — The ac-
cused pleaded guilty to three charges under s. 38 [now s. 61] relating to its attempts to ensure
that its suggested retail prices were charged by retailers. Its actions were part of an orderly
marketing policy which included maintenance of adequate stock, utilization of acceptable
advertising and display, and provision of satisfactory customer service. Its product was sold
in 7,000 stores, but there was no evidence the conduct complained of was widespread. As
there was insufficient evidence to establish the conduct would continue, a prohibition order
was refused. Fines of $1,000, $1,500 and $750 were imposed.
R. v. Can. Safeway Ltd. (1971), 4 C.P.R. (2d) 217 (Sask. Mag. Ct.). (See also entry under s.
52.) — The accused had pleaded guilty to an offence under s. 36 [now s. 52] and had discon-
tinued the illegal practice of its own volition, and it was a first offence. A prohibition order
was therefore denied.
R. v. T. Eaton Co. (1971), 4 C.P.R. (2d) 226 (Ont. Prov. Ct.) — A sale that goes on for at
least 114 days out of the year is not a sale, and prices charged on the other days cannot be
described as ordinary prices. In advertising such a sale the accused was guilty under s. 36
[now s. 52] of making a materially misleading representation to the public concerning the
price at which the items had been or were ordinarily sold. This was a practice of the entire
trade needing correction. A prohibition order was therefore made. However, since the ac-
cused was not morally culpable, a nominal fee of $200 was imposed.
81
R. v. Seltzer (1970), 64 C.P.R. 77 (Que. S.P.) — Special reasons for the issue of a prohibition
order must be given to ensure the discretion given by this section is exercised judiciously.
R. v. Atl. Sugar Refineries Ltd. (1967), 69 D.L.R. (2d) 142, [1968] 3 C.C.C. 374 (Que.
C.A.) — Even if a prohibition order is granted when the accused is sentenced, a further order
may be granted or the original order amplified within three years of the conviction. A prohi-
bition order may be made against a convicted person without the production of additional
evidence.
R. v. D.E. Adams Coal Ltd. (1957), 23 W.W.R. 419, 65 Man. R. 358, 27 C.R. 47, 29 C.P.R.
163, 119 C.C.C. 350 (Q.B.) — Whether a conspiracy to lessen competition benefited or
harmed the public is not to be considered in determining the appropriate penalty. Where
there are several accused, a proper approach is to divide them into categories according to
their volume of business and the length of time they participated in the conspiracy, and to
impose a different penalty in each category. Fines varying from $250 to $2,500 for the cor-
porate accused and from $50 to $1,500 for the individual accused were imposed for a con-
spiracy in Greater Winnipeg concerning coal supply contract tenders. Although the scheme
or arrangement had been abandoned, a prohibition order was also granted.
R. v. Dom. Steel & Coal Corp. (1956), 116 C.C.C. 117 at 135, 27 C.P.R. 57 (Ont. H.C.). (See
also entry under s. 45(1)(c).) — There is no reason to distinguish in relation to the amount of
the fine between a wholly-owned subsidiary acting under the orders of its parent company
and the parent. The duration of the conspiracy, 20 years, and the complete control of prices
and conditions of sale through the agreement were considered in imposing the maximum
fine of $10,000 on each of the participants. A prohibition order is discretionary. Although
the impugned practices had been stopped even before an inquiry was started, the duration of
the conspiracy, its scope and the tightness of control justified issuance of a prohibition order.
Goodyear Tire & Rubber Co. of Can. v. R., [1956] S.C.R. 303, 26 C.P.R. 1, 114 C.C.C. 380,
2 D.L.R. (2d) 11 — It is intra vires Parliament to empower the granting of an order prohibit-
ing “the continuation or repetition of the offence or the doing of any act or thing by the
person convicted or any other person directed towards the continuation or repetition of the
offence” on conviction of a person for an offence under the Act. The power to legislate in
relation to criminal law is not restricted to defining offences and providing penalties for their
commission, but extends to preventing crime. Whether in granting the power to make a pro-
hibition order Parliament was defining an offence or merely providing the means of prevent-
ing the commission of the offence, it was acting within its power under the criminal law
head. The words “or any other person” refer to a corporate accused’s directors, officers,
servants and agents, and not to persons unconnected with those convicted.
Subsection (2)
Canada v. Chambre d’Immeuble du Saguenay-Lac St. Jean Inc. (1999), 90 A.C.W.S. (3d)
378 (Fed. T.D.) — Pursuant to s. 34(2), a prohibition order was made on December 20, 1988
prohibiting certain conduct by the Canadian Real Estate Association (CREA) and nine-mem-
ber organizations relating to the MLS to prevent the MLS from being used to control certain
practices of real estate brokers. The order had no stated time limitation, and it appeared that
it was intended to have perpetual effect on the activities of CREA and its member organiza-
tions. On March 18, 1999, various amendments to the Act came into force including subs.
34(2.2) which provided that orders made under s. 34 applied for a period of ten years unless
the court specified a shorter period. CREA successfully obtained a declaration that the prohi-
bition order ceased to have effect on March 18, 1999. The order would remain in effect until
that date and would govern any breaches of the order that occurred before that date. How-
82
ever, subs. 34(2.2) put an end to the duration of the order so that it was no longer possible,
after March 18, 1999, for the order to be breached.
R. v. Services Sanitaires de Shawinigan Inc. (April 26, 1996), de Blois J. (Que. S.C.) — The
court issued an order under s. 34(2) prohibited the respondents from doing any act directed
toward the commission of an offence under s. 45(1)(c) including continuing or repeating any
act that was directed toward the commission of the said offence by means of agreements,
Act
combines or arrangements relating to calls or requests for tenders, prices, markets or services
offered by the respondents in the waste collection and removal industry.
R. v. Chambre d’Immeuble du Saguenay-Lac St.-Jean Inc. (1988), 23 C.P.R. (3d) 204 (Fed.
T.D.) — The court issued a prohibition order under this section with the consent of the appli-
cants. The order prohibited the commission of offences under ss. 45 and 61 as well as a
number of specific actions and ordered the respondents to carry out a number of specific
actions. (The judgment reproduces the order in full.) See also entry under subsection (2.2).
R. v. Law Assn. (Waterloo) (1988), 21 C.P.R. (3d) 528 (Ont. H.C.) — A prohibition order
was issued on consent prohibiting the commission of an offence under s. 45(1)(c), namely
conspiring, combining, agreeing or arranging re residential real estate legal services. The
judgment as reported consists of the full text of the Order.
R. v. Shaklee Can. Inc. (1985), 38 Alta. L.R. (2d) 289, 4 C.P.R. (3d) 433, 59 N.R. 147 (Fed.
C.A.); affirmed (sub nom. Shaklee Can. Inc. v. Canada (A.G.)) [1988] 1 S.C.R. 662, 58 Alta
L.R. (2d) 348, 20 C.P.R. (3d) 192, 84 N.R. 385 (S.C.C.) — The Federal Court (Trial Divi-
sion) has jurisdiction to issue an order of prohibition. Pursuant to s. 44(4) [now s. 67(5)], the
Attorney General may either request an order of prohibition under s. 30(2) [now s. 34(2)] or
prosecute under s. 36.3(3) [now s. 55(3)], but may not proceed with both remedies. The
respondent’s pyramid selling scheme contravened s. 36.3(1)(b) and (2) [now s. 55(3)(1)(b)
and (2)]. Such schemes are inherently deceptive and misleading by relating bonuses to peo-
ple rather than product, which increases the number of sellers in the market thereby reducing
the opportunity for earning bonuses. An order prohibiting continuation of such a scheme is
therefore appropriate.
R. v. Can. Oxygen Ltd. (1975), 24 C.P.R. (2d) 258, 26 C.C.C. (2d) 398, 64 D.L.R. (3d) 151
(Que. C.A.) — An order of prohibition should be refused where the Crown lays the informa-
tion eight years after the date of the alleged offence. Furthermore, to commit acts “directed
towards a conspiracy, combination, agreement or arrangement to prevent competition” is not
an offence under the Act and accordingly cannot be used to require a prohibition order. An
information alleging such acts is void.
R. v. Can. Safeway Ltd., [1974] 1 W.W.R. 210, 12 C.P.R. (2d) 3, 14 C.C.C. (2d) 14, 41
D.L.R. (3d) 254 (Alta. S.C.) — In order to have jurisdiction to issue an order of prohibition
the court must satisfy itself only that the party against whom such an order is sought has
done acts or things constituting or directed towards the commission of an offence under Pt.
V [now Pt. VI] and which if unrestrained would probably, at a later date, constitute an of-
fence. It is not necessary that the court finds that the offence has been committed.
R. v. Hemlock Park Co-op. Farm Ltd., [1974] S.C.R. 123, 5 C.P.R. (2d) 101, 6 C.C.C. (2d)
189, 24 D.L.R. (3d) 688 — The definition of “indictment” in the Criminal Code, R.S.C.
1970, c. C-34, is inapplicable to the word “information” in ss. 30(2) [now s. 34(2)] and 44(4)
[now s. 67(5)]. Although proceedings under s. 30 [now s. 34] are criminal, they are validly
commenced by an information drawn up in accordance with the Exchequer Court Rules and
filed in the Exchequer Court; ss. 30(2) [now s. 34(2)] and 44(4) [now s. 67(5)] create an
exception to the Criminal Code rule that “no criminal information shall be laid or granted”
(s. 488(2), now s. 576(2)).
83
Subsection (6)
R. v. Gignac (1975), 25 C.P.R. (2d) 265, 29 C.C.C. (2d) 74 (Ont. Prov. Ct.) — An informa-
tion laid against the accused for breach of a prohibition order was quashed since s. 30(6)
[now s. 34(6)] does not create an offence, nor does it give any guidance as to the procedure
to be followed to implement it, although the proper procedure might be an information under
s. 116 of the Criminal Code, R.S.C. 1970, c. C-34.
R. v. Allied Towers Merchants Ltd. (1969), 60 C.P.R. 140 (Ont. Prov. Ct.) — The offence of
making a materially misleading advertisement is distinct from the offence of breaching an
order prohibiting continuation of that offence, and on a charge of breaching such an order
autrefois convict is not available. Breach of such an order is not a summary conviction
offence.
35. (1) Court may require returns — Notwithstanding anything contained

in Part VI, where any person is convicted of an offence under that Part, the
court before whom the person was convicted and sentenced may, from time to
time within three years thereafter, require the convicted person to submit such
information with respect to the business of that person as the court deems ad-
visable, and without restricting the generality of the foregoing, the court may
require a full disclosure of all transactions, operations or activities since the
date of the offence under or with respect to any contracts, agreements or ar-
rangements, actual or tacit, that the convicted person may at any time have
entered into with any other person touching or concerning the business of the
person convicted.
(2) Punishment — The court may punish any failure to comply with an or-
der under this section by a fine in the discretion of the court or by imprison-
ment for a term not exceeding two years.
36. (1) Recovery of damages — Any person who has suffered loss or dam-
age as a result of
(a) conduct that is contrary to any provision of Part VI, or
(b) the failure of any person to comply with an order of the Tribunal or
another court under this Act,
may, in any court of competent jurisdiction, sue for and recover from the per-
son who engaged in the conduct or failed to comply with the order an amount
equal to the loss or damage proved to have been suffered by him, together with
any additional amount that the court may allow not exceeding the full cost to
him of any investigation in connection with the matter and of proceedings
under this section.
(2) Evidence of prior proceedings — In any action under subsection (1)
against a person, the record of proceedings in any court in which that person
was convicted of an offence under Part VI or convicted of or punished for
failure to comply with an order of the Tribunal or another court under this
Act is, in the absence of any evidence to the contrary, proof that the person
against whom the action is brought engaged in conduct that was contrary to a
84
provision of Part VI or failed to comply with an order of the Tribunal or an-

other court under this Act, as the case may be, and any evidence given in those
proceedings as to the effect of those acts or omissions on the person bringing
the action is evidence thereof in the action.
(3) Jurisdiction of Federal Court — For the purposes of any action
Act
under subsection (1), the Federal Court is a court of competent jurisdiction.
(4) Limitation — No action may be brought under subsection (1),
(a) in the case of an action based on conduct that is contrary to any provi-
sion of Part VI, after two years from
(i) a day on which the conduct was engaged in, or
(ii) the day on which any criminal proceedings relating thereto were
finally disposed of,
whichever is the later; and
(b) in the case of an action based on the failure of any person to comply
with an order of the Tribunal or another court, after two years from
(i) a day on which the order of the Tribunal or court was contra-
vened, or
(ii) the day on which any criminal proceedings relating thereto were
finally disposed of,
whichever is the later.
R.S.C. 1985, c. 1 (4th Supp.), s. 11
Commentary
Section 36 confers a private right of action for any person who has suffered loss or damage
as a result of a breach of one of the criminal provisions of the Act. Such persons may sue for
and recover damages equal to the actual loss suffered, plus the costs of investigating the
misconduct and of bringing the proceeding. There is also a right of action under section 36
for loss and damage resulting from a failure to comply with an order of a court or the Tribu-
nal, including an order of the Tribunal prohibiting a reviewable practice.
The right of action in section 36 has a relatively short limitation period. An action must be
brought within two years from the later of the day on which the conduct was engaged in, the
day on which any criminal proceedings are disposed of, or the day on which the breach of
the court or Tribunal order occurred. However, the “discoverability rule” applies to section
36 claims. This postpones the start of the limitation period until the time that the plaintiff
knew or ought to have known of the anti-competitive conduct. The discoverability rule does
not apply to the two-year period following disposition of any criminal proceedings. See
Pioneer Corp. v. Godfrey, 2019 SCC 42 (S.C.C.).
In contrast to the United States, a person suing under section 36 may not claim treble dam-
ages. Section 36 also does not allow for recovery of punitive damages. Whether interlocu-
tory or permanent injunctions are available in actions under section 36 remains an open
question, although some courts have found that injunctive relief is not available.
In an attempt to avoid these limitations, claimants commencing actions under section 36
typically also include tort claims alleging, for example, common law conspiracy and unlaw-
85
ful interference with economic interests. These claims may extend the limitation period and
the available remedies. They also permit claims for punitive damages.
There is some uncertainty about whether injunctive relief is available to a private party that
commences an action under section 36. Section 33 only allows the Attorney General of Can-
ada or of a province to seek an interim injunction where it appears that an offence has been
committed. Section 36 does not give private parties the right to seek injunctive relief; nor
does it expressly preclude courts from granting equitable injunctions at the behest of private
parties. Courts have expressed divergent views on the issue and, partially because of that
uncertainty, it is not uncommon for claimants to include in a section 36 action a tort claim
that would clearly permit a court to grant injunctive relief.
A private litigant may establish liability under section 36 whether or not the defendant com-
pany has been convicted of the criminal offence underlying the action. In most cases, how-
ever, a private action is brought only after a successful criminal prosecution for or a guilty
plea to one of the offences described below, or an equivalent offence under another coun-
try’s antitrust laws. The conviction can be used in civil proceedings to establish commission
of the offence.
It is expensive and often difficult for a claimant in a civil action to establish the commission
of one of the offences in the Act. In the absence of a prior conviction in a criminal proceed-
ing, courts will require a high degree of proof before finding that criminal conduct has taken
place. For these reasons, actions under section 36 of the Act have been rare, and successful
judgments even more so. With the advent of class proceedings in Canada, however, the vol-
ume of private actions has increased dramatically.
Class proceedings, or class actions, are now available by statute in all provinces except
Prince Edward Island and in the Federal Court of Canada. The incentives created by the
availability of contingency fees, and the possibility of much larger damage awards, have
encouraged counsel and potential class members to pursue claims under section 36 that oth-
erwise would not have been brought. While there are undoubtedly substantially more actions
being commenced under section 36, class proceedings involve their own unique procedural
hurdles.
Like other class proceedings, a class proceeding alleging a violation of Canadian competi-
tion law must satisfy the test for certification before a court will allow it to proceed to trial.
The certification test in a class proceeding in the common-law provinces typically includes
the following elements:
• the claim must disclose a cause of action;
• there must be an identifiable class of persons;
• the claims must raise common issues;
• a class proceeding must be the preferable procedure; and
• there must be an appropriate representative plaintiff.
In determining whether a proceeding can proceed as a class action, one of the key questions
is whether the claim raises common issues related to the economic loss suffered by proposed
class members. For many years the leading antitrust class proceeding case was Chadha v.
Bayer Inc., decided by the Ontario Court of Appeal in 2003. The case involved an alleged
conspiracy to fix the price of iron oxide pigments used in the manufacture of bricks, paving
stones and other building materials. A class composed entirely of indirect purchasers —
homeowners — asserted that the alleged overcharge was passed on to them through a
lengthy distribution chain. The appeal court determined that section 36 requires claimants to
establish proof of loss as an essential component of liability. Liability could not be a com-
86
mon issue on the facts of the case. Each homeowner would be required to establish his or her
loss independently. The complexities of proving the extent to which various participants in
the distribution chain passed on the higher price caused by the alleged price-fixing conspir-
acy led the Court to determine that a class proceeding was not the preferable procedure. The
Court left open the possibility that in another case where the evidence met the Court’s con-
cerns, claims by indirect purchasers could be pursued through a class action.
Act
The approach taken in Chadha is no longer favoured by the courts. Subsequent cases tended
to distinguish it on the facts, and in 2013, the Supreme Court of Canada determined that
indirect purchasers should be able to bring claims through class proceedings if they can sat-
isfy the court through expert evidence that there is a “plausible methodology” for establish-
ing that overcharges have been passed on to the indirect purchaser class (see Pro-Sys
Consultants Ltd. v. Microsoft Corp., 2013 SCC 57 (S.C.C.), and Sun-Rype Products Ltd. v.
Archer Daniels Midland Co., 2013 SCC 58 (S.C.C.).) Later, in the Godfrey case, the Su-
preme Court clarified that the plaintiff has to show a plausible methodology for establishing
that loss reached the indirect purchaser level; it does not need to identify particular class
members who may or may not have suffered harm.
Another question the courts have frequently considered is whether the cause of action cre-
ated by section 36 is a “complete code” for recovering loss or if common law or equitable
claims for damages resulting from an alleged conspiracy remained available to plaintiffs.
The Supreme Court decided in Godfrey that it was not, and both statutory and common law
claims remain available to plaintiffs.
Together, these cases will likely lead to more class proceedings under section 36, particu-
larly in international conspiracy cases involving classes comprised of both direct and indirect
purchasers.
Case Law
Lin v Airbnb, Inc., 2019 FC 1563, 2019 CarswellNat 10122, 2019 CarswellNat 10123, 315
A.C.W.S. (3d) 642 — The claimant alleged that Airbnb had breached section 54 of the Act
by engaging in “double ticketing” by supplying a product at a price that exceeds the lowest
of two or more clearly expressed prices at the time the product is supplied. The Court af-
firmed that to bring a claim under section 36, a plaintiff must only plead the elements of the
criminal offense contained in Part VI of the Act and demonstrate that he or she suffered a
loss or damage as a result of the defendant’s conduct. The Court acknowledged that novel
pleadings of law do not automatically bar section 36 claims at the class certification stage as
being “plain and obvious” to fail nor do anticipated difficulties in demonstrating that the
plaintiff has suffered loss or damage mean that there is no basis in fact that the loss or
damage occurred. Instead, the Court emphasized that the merits of both novel claims and the
plaintiff’s evidence that he or she has sustained a loss or damage are to be reviewed by a trial
judge who has the benefit of the issues being argued in full and with a complete discovery
record.
Pioneer Corp. v. Godfrey, 2019 CarswellBC 2746, 2019 CarswellBC 2747, 2019 SCC 42,
[2019] 11 W.W.R. 191, [2019] S.C.J. No. 42, 26 B.C.L.R. (6th) 1, 309 A.C.W.S. (3d) 32, 39
C.P.C. (8th) 229, 437 D.L.R. (4th) 383; aff’g 2017 BCCA 302; aff’g 2016 BCSC 844 — The
Supreme Court clarified a number of issues under section 36 in this proposed class proceed-
ing related to price fixing in the market for optical disk drives: limitations periods, whether
“umbrella purchasers” have a cause of action, the type of expert evidence required to certify
a class action, and whether relying on section 36 prevents a plaintiff from also seeking dam-
ages for common law or equitable causes of action. With respect to limitation periods under
87
subsection 36(4), the limitation period in paragraph 36(4)(a)(i) is triggered by the occurrence
of an element of an underlying cause of action, namely conduct contrary to Part VI of the
Act, and is subject to discoverability. Parliament could not have intended in enacting para-
graph 36(4)(a)(i) that a claimant’s right of action could expire before she or he had knowl-
edge of the anti-competitive behavior. In contrast, the discoverability rule does not apply to
the limitation period provided by paragraph 36(4)(a)(ii), which runs from the day on which
criminal proceedings are disposed of, because the event triggering the limitation period “is
not connected to a plaintiff’s cause of action or knowledge.” The Court also held that “um-
brella purchasers” (persons who purchased products neither manufactured nor supplied by
the cartel’s members but who are alleged to have paid higher prices due to the cartel’s activ-
ity in the market) have a cause of action under paragraph 36(1)(a) and it is not “plain and
obvious” that a claim brought by umbrella purchasers cannot succeed. Paragraph 36(1)(a)
provides a cause of action to “any person” who has suffered loss or damage as a result of
conduct contrary to section 45. Allowing umbrella purchaser claims is consistent with the
purposes of the Act by further deterring anti-competitive conduct and affording additional
recourse for plaintiffs to recover from loss arising from anti-competitive behavior. With re-
spect to the nature of required expert evidence, to certify loss-related questions as common
issues in a price-fixing class proceeding a court must be satisfied that the plaintiff has shown
a plausible methodology to establish that loss reached one or more purchasers. It is not nec-
essary that the methodology be able to identify which class members suffered a loss from
those who did not. Finally, bringing a claim under subsection 36(1) does not preclude the
plaintiff from pursuing common law or equitable causes rights of action. Subsection 36(1)
does not represent a comprehensive and exclusive code regarding claims for anti-competitive
conduct.
Ewert v. Nippon Yusen Kabushiki Kaisha, 2019 BCCA 187, 2019 CarswellBC 1478, 25
B.C.L.R. (6th) 268, 305 A.C.W.S. (3d) 706, 34 C.P.C. (8th) 312; rev’g 2017 BCSC 2357 —
The plaintiff in this proposed class proceeding had alleged a price fixing conspiracy by
marine shippers transporting automobiles and other vehicles made overseas to Canada, re-
sulting in higher costs for persons who purchased vehicles in British Columbia. The claimant
sought losses under section 36 of the Act and to have the action certified as a class action,
but was denied at the certification hearing on the basis the plaintiff’s expert had not estab-
lished the existence of the data needed to show the losses had been passed on to the members
of the proposed class. On appeal, the Court affirmed the approach articulated in Microsoft.
Where the methodology involves an econometric model, it is not necessary to build the
model or to identify with precision what information will be used to populate the model at
the certification stage as long as there is some evidence that information is available to do so
at the time of trial. The Court was satisfied that there was such evidence for the direct and
indirect purchasers of transported vehicles; however, the Court was unable to find that the
same methodology would be able to determine if losses had been suffered by umbrella
purchasers.
Hughes v. Liquor Control Board of Ontario, 2019 ONCA 305, 2019 CarswellOnt 5818, 145
O.R. (3d) 401, 304 A.C.W.S. (3d) 151 — The claimant alleged that the “Framework Agree-
ment” between the Liquor Control Board of Ontario and Brewers Retail Inc. violated section
45 of the Act as a conspiracy to divide the beer market in Ontario between the two entities.
The claimants sued for damages under subsection 36(1) of the Act. The Court noted that
subsection 45(7) allowed for a “regulated conduct defence” to avoid criminalizing conduct
that, in this instance, the province of Ontario, deemed to be in the public interest. A regulated
conduct defence insulates the defendant from criminal liability if the legislation governing
the regulated defendant (here, the Liquor Control Act) is constitutionally valid, it directs or
authorizes the defendant to engage in the impugned conduct, and the law providing for crim-
88
inal liability such as section 45 of the Act leaves room for the regulated activity to operate
without being criminalized. The Court found that where the regulated conduct defence is
available, it may also be used to defend against civil claims under section 36 of the Act that
stem from conduct allegedly contrary to section 45.
Evans v. General Motors of Canada Co., 2019 SKQB 98, 2019 CarswellSask 190, [2019] 10
W.W.R. 725, 304 A.C.W.S. (3d) 479. — The plaintiff alleged that she and other consumers
Act
had bought vehicles from the defendant manufacturer which subsequently started to leak
coolant fluid, causing health concerns and performance problems with the vehicle. The
plaintiff claimed, among other things, a breach of section 52 of the Act on the basis that the
defendants made false and misleading representations or omissions of material fact in con-
nection with the marketing, promotion and sale of the vehicle model. The plaintiff sought to
recover for loss and damage as a result of these misrepresentations pursuant to section 36.
The Court noted, citing Rebuck v. Ford Motor Company, 2018 ONSC 7405, that the state-
ment of claim pleaded facts which related to reliance and alleged that class members would
not have purchased the vehicles absent the false representations; however, the Court af-
firmed that under section 36, a plaintiff need not plead that misrepresentations were an in-
ducement to buy a product, but rather that the misrepresentations caused him or her to ac-
quire less value than he or she expected to acquire.
Bell Canada v. Cogeco Cable Canada GP Inc., 2016 ONSC 6044 (Ont. S.C.J.) — The plain-
tiff sought an injunction to cease the use of advertisements which stated that the defendant
had the “best Internet experience in your neighbourhood”. The Court granted the injunction.
The Court rejected the defendant’s propositions that in the internet context the overall im-
pression should be conveyed by taking into consideration all the content of the homepage,
graphics and hyperlinks. Rather, the Court indicated (while not expressly ruling on the issue)
that at minimum, the impression of the online advertisement should be analyzed by taking
into account what a consumer would see on a single screen.
Option Consommateurs c. Minebea Co., 2016 QCCS 3698 (C.S. Que.) — The Superior
Court authorized a class action alleging price fixing in the sale of small-sized ball bearings
on behalf of a group which included direct and indirect purchasers. The Superior Court con-
cluded that it was not unreasonable to find that the anticompetitive practices by defendants in
Korea, the United States or elsewhere could have an impact on Quebec consumers.
Murphy c. Cie Amway Canada, 2015 FC 958 (F.C.) — A plaintiff must provide evidence of
other class members with the same complaints against the defendant at the outset. A mere
inference that other class members likely exist is insufficient. Section 36 requires the plain-
tiff to show a causal link between alleged misrepresentations and the damages claimed. This,
in turn, requires showing reliance and causality for each class member, which will be diffi-
cult in factual circumstances where these issues are highly individualized for each class
member. The Court noted that the plaintiff did not lodge a complaint with the Competition
Bureau although it would be significantly less costly and more efficient than class action
proceedings to address the issues raised by the plaintiff.
Fairhurst v. Anglo American PLC, 2014 BCSC 2270 (B.C. S.C.) — Plaintiffs sought to cer-
tify a proposed class action, claiming that the defendants conspired to fix prices for
diamonds. Although there is inconsistency in the jurisprudence, claims for restitution, to the
extent that they are based on breaches of the Competition Act, are not viable. However, tort
claims based on these breaches may be viable.
1146845 Ontario Inc. v. Pillar to Post Inc., 2014 ONSC 7400 (Ont. S.C.J.); additional rea-
sons 2015 CarswellOnt 2305 (Ont. S.C.J.) — The defendant franchisor sought to stay a pro-
posed class action on the basis of an arbitration clause in the relevant franchise agreement.
89
The court rejected the plaintiffs’ argument that competition law, by its nature, should never
be the subject of arbitration because arbitration is not compatible with the public interest
objectives found in the Competition Act. Consequently, claims under s. 36 of the Competi-
tion Act can be determined by arbitration.
Pro-Sys Consultants Ltd. v. Microsoft Corporation, 2013 SCC 57 (S.C.C.); reversing 2011
BCCA 186, 2011 CarswellBC 930 (B.C. C.A.); reversing 2010 BCSC 285, 2010 Car-
swellBC 508 (B.C. S.C.) — The plaintiff brought a motion for certification of a class pro-
ceeding on behalf of indirect purchasers of Microsoft operating systems and/or application
software. The plaintiff alleged that Microsoft had breached subsections 45 and 52 of the Act,
which resulted in artificially inflated prices, and sought damages under section 36. The Su-
preme Court of Canada held that indirect purchasers have a cause of action for damages. The
“passing on defence” has been rejected in Canadian law, meaning that defendants cannot
defend a claim brought by direct purchasers by asserting that they (the direct purchasers)
suffered no loss because they passed on any overcharge to indirect purchasers (the direct
purchasers’ customers). However, that does not mean that passed-on overcharges cannot
form the basis of a cause of action. The unanimous Court rejected the arguments the respon-
dents had put forward in opposition. The Court held that (1) the risk of multiple recovery due
to claims brought by both direct and indirect purchasers can be managed by the courts; (2)
allowing indirect purchasers to bring claims does not frustrate the enforcement of competi-
tion laws; (3) indirect purchaser actions are consistent with the objectives of the law of resti-
tution, because they allow those who have actually suffered harm to obtain compensation;
and (4) the US Illinois Brick-line of precedent is not universally accepted: many states have
enacted “repealer statutes” to allow indirect purchaser claims to be brought in state courts,
the Antitrust Modernization Commission has recommended that Congress repeal the Illinois
Brick rule at the federal level, and, in the Court’s view, the weight of academic opinion is in
favour of repealing the decision and allowing indirect purchaser claims. The plaintiff indirect
purchasers therefore had a cause of action under s. 36. The fact that the s. 36 cause of action
was not specifically pleaded in the statement of claim was purely a technical objection and
could not be the basis on which to dismiss the claim. In 2014, the British Columbia Supreme
Court held that it is not plain and obvious that breaches of Part IV of the Competition Act
cannot be relied on as the basis for the tort of illegal means conspiracy. It is also not plain
and obvious that third parties against whom the illegal activities were directed must reside in
Canada (2014 BCSC 1280 (B.C. S.C.)).
Sun-Rype Products Ltd. v. Archer Daniels Midland Company, 2013 SCC 58 (S.C.C.); af-
firming in part and reversing in part 2011 BCCA 187, 2011 CarswellBC 931 (B.C. C.A.);
reversing in part 2010 BCSC 922, 2010 CarswellBC 1749 (B.C. S.C.) — The plaintiff
brought a motion for certification of a class proceeding on behalf of a class of both direct
and indirect purchasers of high-fructose corn syrup (HFCS) manufactured by the defendants.
The plaintiffs alleged that the defendants had engaged in a conspiracy to fix the price of
HFCS. The Supreme Court of Canada found, for the same reasons as in Pro-Sys, 2013 SCC
57, that indirect purchasers did have a cause of action. The Supreme Court held that there
was no difficulty in combining classes of direct and indirect purchasers. However, in this
case, the Court by a 7-2 majority held that there was no basis in fact to conclude that there
was an identifiable class of two or more indirect purchasers, which was one of the certifica-
tion requirements set out in BC’s class proceedings statute. Since there was no identifiable
class, the proceeding could not be certified. The defendants had cross-appealed the finding
that the direct purchasers had a claim in constructive trust. The Supreme Court allowed the
cross-appeal and therefore dismissed the action in its entirety.
90
321665 Alberta Ltd. v. ExxonMobil Canada Ltd., 2012 ABQB 76 (Alta. Q.B.) — “Full cost”
in section 36(1) means party and party costs. The court accepted the plaintiff’s claim for
investigation costs but reduced the award. The court also rejected the claims for reimburse-
ment of a litigation loan and compound interest and reduced the amount of time for which
the plaintiff was entitled to interest due to the plaintiff’s delay in advancing the matter to
trial.
Act
Rhodes v. Cie Amway Canada, 2011 FC 1341 (F.C.) — The plaintiff instituted a proposed
class proceeding. The defendant brought a motion to stay and compel arbitration on the basis
that an agreement between the parties granted jurisdiction to a specified arbitrator and pre-
cluded the Federal Court from hearing the plaintiff’s motion. The court rejected the plain-
tiff’s claim that section 36 overrides contractual agreements as to dispute resolution. The
court found that section 36 in no way excludes arbitration as a valid forum.
Steele v. Toyota Canada Inc., 2011 BCCA 98, 2011 CarswellBC 424, 90 C.P.R. (4th) 450
(B.C.C.A.); reversing 2008 CarswellBC 1658, 295 D.L.R. (4th) 653, 68 C.P.R. (4th) 27
(B.C.S.C.) — The plaintiffs were B.C. residents who sought to certify a class proceeding on
behalf of B.C. purchasers of new Toyota vehicles during the Toyota Access Program mar-
keting campaign. The plaintiffs alleged that the Access Program deprived them of their abil-
ity to negotiate for the purchase of their vehicles and sought damages under section 36 of the
Act for breach of subsections 52 and 61. Prior to this proceeding, in March 2003, Toyota and
the Commissioner had entered into a consent prohibition order pursuant to section 34 of the
Act, which ordered Toyota, among other things, to terminate the Access Program. The
chambers judge dismissed the application for certification, ruling that a class proceeding
would not be the preferable procedure because the plaintiffs had failed to provide sufficient
evidence that proof of liability could be established on a class-wide basis. The chambers
judge concluded that proof of liability would require an individual assessment of loss or
damage, similar to the finding by the Quebec Court of Appeal in Harmegnies c. Toyota
Canada, 2008 CarswellQue 1155 (Que. C.A.); leave to appeal refused 2008 CarswellQue
9014 (S.C.C.), where the court of appeal upheld the decision of the trial judge who refused to
grant certification of a class proceeding because, among other reasons, an individual exami-
nation would be required to determine whether any individual class member actually suf-
fered loss or damage. On appeal of the chambers judge’s decision, the Court of Appeal over-
turned the decision and certified the action as a class proceeding. The court ruled that given
the uncertain state of the law with respect to benefit-based claims, the chambers judge erred
in law by concluding that the applicants’ pleaded causes of action all required individual
proof of loss. The chambers judge did not have the benefit of the Court of Appeal’s decision
in Pro-Sys Consultants Ltd. v. Infineon Technologies AG, 2009 BCCA 503, 2009 Car-
swellBC 3035 (B.C.C.A.); leave to appeal refused 2010 CarswellBC 1361, 2010 CarswellBC
1362 (S.C.C.), which cast doubt on the need for proof of individual loss or damages as a pre-
requisite for the certification of a class proceeding in British Columbia. Additionally, the
Court of Appeal ruled that the applicants had demonstrated that sufficient evidence was
available to potentially convince a judge that proof of loss on a class-wide basis may be
possible and, although there were novel elements, the applicant’s proposed method for estab-
lishing aggregate damages was sufficient for the certification stage.
Novus Entertainment Inc. v. Shaw Cablesystems Ltd., 2010 BCSC 1030, 2010 CarswellBC
1962 (B.C.S.C.) — The defendant brought an application to strike out elements of the plain-
tiff’s statement of claim, including paragraphs alleging abuse of dominance by the defendant
under section 79. The plaintiff alleged that the defendant’s marketing campaign, which of-
fered products below their variable cost to the plaintiff’s customers, amounted to a breach of
section 79. Recovery was sought under section 36. The portions of the statement of claim
91
alleging a breach of section 79 were struck out along with other pleadings. In Pro-Sys
Consultants Ltd. v. Microsoft Corp., 2010 BCSC 285 (B.C.S.C.); reversed 2011 CarswellBC
930 (B.C.C.A.), the court held that in respect of conduct of the nature described in Part VIII
of the Act, a judicial remedy under section 36 is available only when the Tribunal has made
an order prohibiting the conduct and there has been non-compliance with the order. Recent
amendments to the Act have not changed the rationale underlying the decision in Pro-Sys.
The Tribunal has exclusive jurisdiction to determine whether conduct is anti-competitive,
and until this determination is made, it cannot be said that a party’s conduct is unlawful.
Telus Communications Co. v. Rogers Communications Inc., 2009 BCCA 581, 2009 Car-
swellBC 3424 (B.C.C.A.) — The Supreme Court of British Columbia has inherent jurisdic-
tion to grant an interlocutory injunction, notwithstanding that the plaintiff’s claim is statutory
and notwithstanding that the statute itself does not provide for the issuance of injunctions at
the behest of a private party. The Court of Appeal expressed no view on whether a perma-
nent injunction can be granted to a private party in a claim brought pursuant to s. 36.
Pro-Sys Consultants Ltd. v. Infineon Technologies AG, 2009 BCCA 503, 2009 CarswellBC
3035 (B.C.C.A.); reversing 2008 BCSC 575, 2008 CarswellBC 943 (B.C.S.C.); leave to ap-
peal refused 2010 CarswellBC 1361 (S.C.C.) — The plaintiff brought a motion for certifica-
tion of a class action on behalf of direct and indirect purchasers of dynamic random access
memory (DRAM) chips. The plaintiff alleged that the defendants engaged in a price fixing
conspiracy giving rise to damages under s. 36. The certification motion was denied but that
decision was reversed on appeal. The chambers judge concluded that the plaintiff failed to
establish that harm from the alleged conspiracy could be determined on a class-wide basis.
Given the absence of a class-wide means of proving harm, a class proceeding was not the
preferable procedure for the resolution of the common issues. The B.C. Court of Appeal
reversed the decision of the chambers judge and concluded that it was possible to establish
liability on a class-wide basis. It relied on the statistical aggregation provisions contained in
the Class Proceedings Act, R.S.B.C. 1996, c. 50, which permit the use of statistical evidence
to determine the amount of the unlawful gain attributable to the class. The aggregate assess-
ment would establish both that the defendant benefited from its wrongful conduct, thus es-
tablishing liability, and the extent of the benefit. The evidentiary burden on a plaintiff to
establish at the certification stage that there is a methodology for calculating damages on a
class-wide basis is not an onerous one. The Court of Appeal granted the application to certify
the action as a class proceeding.
Irving Paper Ltd. v. Atofina Chemicals Inc., 2009 CarswellOnt 8610 (Ont. S.C.J.); leave to
appeal refused 2010 ONSC 2705, 2010 CarswellOnt 3898 (Ont. S.C.J.) — The plaintiff
brought a motion for certification of a class action on behalf of direct and indirect purchasers
of hydrogen peroxide and products containing or produced using hydrogen peroxide. The
plaintiff alleged that the defendant companies had engaged in a conspiracy to, and did, allo-
cate markets, restrict supply and increase prices in Canada over an 11-year period as part of
a global cartel. The court described the proposed class as enormous and that it could poten-
tially include all residents of Canada. The defendants argued that the proposed class proceed-
ing was unmanageable and wholly unsuitable for class treatment. The court issued an order
granting certification. First, the plaintiffs’ pleadings disclosed causes of action. Second, the
proposed definition of a class that included both direct and indirect purchasers met the test
for an identifiable class. There was little question that the direct purchasers were readily
identifiable and it was not necessary to show that every member of the class suffered dam-
age. Third, there was sufficient evidence in the record to support the plaintiffs’ contention
that proposed common issues of the fact of harm and aggregate damages were appropriate
and viable common issues. A court is ill-equipped at the certification stage to resolve com-
92
peting expert opinions regarding the methodology to prove loss and damage on a class-wide
basis. It was sufficient at the certification stage to establish that a methodology may exist for
the calculation of damages on a class-wide basis. Fourth, a class proceeding was the prefera-
ble procedure. A class proceeding would meet the goals of behaviour modification and ac-
cess to justice and the defendants did not identify an alternate procedure. Their position that
no litigation was preferable to a class proceeding was untenable. Finally, the representative
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plaintiff was appropriate. Although there may be a conflict between direct and indirect pur-
chasers arising from the impact of passing-on, that does not disqualify them from acting in a
representative capacity. A motion for leave to appeal was dismissed. The Court of Appeal
found that the certification judge had correctly considered the evidence that concluded the
plaintiffs had met their evidentiary burden in relation to the certification requirements of
commonality and preferability. The role of the certification judge is to evaluate and weigh
the expert evidence to determine whether there is some basis in fact to find that proof of
aggregate damages on a class-wide basis is a common issue. While that might require some
review of the evidence, the assessment should not relate to the merits of the claim or the
resolution of conflicting expert reports.
Apotex Inc. v. Eli Lilly & Co., 2004 CarswellNat 1831, 2004 FCA 232, (sub nom. Eli Lilly &
Co. v. Apotex Inc.) 32 C.P.R. (4th) 195, 323 N.R. 180, 240 D.L.R. (4th) 679 (F.C.A); 2009
FC 991 (F.C.T.D.) — The plaintiff alleged that the defendant had infringed eight patents
owned by the plaintiff. Four of the patents had been assigned to the plaintiff by a company.
The defendant alleged that these assignments resulted in the plaintiff controlling all of the
commercially viable processes for making an antibiotic cefaclor. Prior to the assignments,
those processes were controlled by two companies. The defendant alleged that these assign-
ments constituted an agreement that resulted in an undue lessening of competition contrary
to s. 45 of the Competition Act, and counterclaimed for damages under s. 36 of the Act. The
plaintiff and the company moved for summary judgment striking out certain paragraphs of
the statement of defence and counterclaim, and dismissing the counterclaim against the com-
pany. The company also brought a motion appealing an order of a prothonotary dismissing a
motion to strike the counterclaim against it. The motions were granted, and the defendant
appealed. The appeals were allowed. The motions judge was correct in finding that the deci-
sion of the Federal Court of Appeal in Molnlycke AB v. Kimberly-Clark of Canada Ltd.
(1991), 36 C.P.R. (3d) 493 (Fed. C.A.) was binding on him. However, it was not dispositive
of the matter as the case involved a single supplier lawfully entitled to sell the subject matter
of the patent being assigned. The assignment merely transferred the patent to another com-
pany. The Molnlycke case did not prevent a motions judge from considering evidence of
facts beyond the assignment that resulted in an undue lessening of competition, which would
engage s. 45 of the Act. It was not plain and obvious that the defendant had no reasonable
cause of action against the company. The paragraphs of the statement of defence and coun-
terclaim that were struck out were reinstated.
At trial on the merits, the court concluded that the counterclaim for damages under s. 36 of
the Act, due to an alleged breach of s. 45, was without merit because it was time-barred
under subs. 36(4). In this case, the defendants, Eli Lilly, by counterclaim had entered into an
agreement to assign the patents in 1995, which meant the applicable limitation period ex-
pired in 1997. The court noted that even if the discoverability principle applied to this case,
Apotex would have been aware of the assignment to Eli Lilly no later than 1997, which
meant the limitation period would not have expired any later than 1999. The court also held
that Apotex had failed to establish that it suffered a loss arising from the alleged anti-com-
petitive conduct and therefore determined that it had no reason to inquire whether there was
a violation of s. 45 of the Act. The court noted that the issues in this case under s. 45 raised
novel questions, which should not be addressed by way of obiter comments.
93
2038724 Ontario Ltd. v. Quizno’s Canada Restaurant Corp., 2009 CarswellOnt 2533, 96
O.R. (3d) 252 (Ont. Div. Ct.); reversing 2008 CarswellOnt 1156, 89 O.R. (3d) 252 (Ont.
S.C.J.); additional reasons at 2009 CarswellOnt 4328 (Ont. Div. Ct.); affirmed 2010 ONCA
466, 2010 CarswellOnt 4305 (Ont. C.A.); additional reasons at 2010 CarswellOnt 6924 (Ont.
C.A.); leave to appeal refused 2011 CarswellOnt 499, [2010] S.C.C.A. No. 348 (S.C.C.) —
The appellants alleged that Quizno’s had unlawfully conspired with its distributor to sell
goods and supplies at prices fixed and maintained by Quizno’s contrary to s. 61 of the Act
and brought a motion to certify a class action on behalf of all Canadian franchisees of
Quizno’s to seek damages under s. 36. The action was denied. On appeal, the Divisional
Court overturned the decision of the motions judge, conditionally certified the class action
and referred the issue of certification back to the motions judge so the appellants could pro-
vide a revised litigation plan. With respect to the “common issue” criterion, the majority of
the court observed that “whether one of the proposed common issues is overwhelmed or
buried by the individual issues is part of the analysis for the preferable procedure criterion,
but is not necessarily determinative of the common issues requirement.” The court majority
was satisfied that the motions judge had erred in principle by focusing on proof of damages
and by failing to consider and identify other common issues. Specifically, the court majority
held that the motions judge had erred in failing to consider whether there was some other
basis in fact to find that breach of s. 61 and the existence of loss on a class-wide basis were
common issues. The majority observed that loss or damage is not a constituent element of s.
61 because price maintenance occurs when there is an attempt to influence prices upwards,
which exposes purchasers to loss. With respect to the “preferable procedure” criterion, the
court majority found that a class proceeding would be the preferable procedure for resolving
the common issues in light of the objectives of the Class Proceedings Act, 1992. The major-
ity was satisfied that the motions judge had erred in principle by concluding his assessment
with a finding that the individual issues in this case overwhelmed any common issues and by
failing to consider the objectives of the Class Proceedings Act, 1992. Even if loss could not
be proved on a class-wide basis, the majority of the court found that the breach of s. 61
would be a common issue that would have significantly advanced the claim. The Ontario
Court of Appeal held that the court majority had correctly concluded that the motion judge
had erred by focusing on the issue of damages, which overwhelmed the remaining proposed
common issues. The motions judge had referred to the other issues in passing without any
independent analysis, which is the kind of error that attracts the intervention of an appellate
court.
Maritime Travel Inc. v. Go Travel Direct.Com Inc. (2008), 265 N.S.R. (2d) 369, 66 C.P.R.
(4th) 61 (N.S.S.C.); additional reasons at 2008 NSSC 306, 2008 CarswellNS 580 (N.S.S.C.);
additional reasons at 2008 NSSC 328, 2008 CarswellNS 602 (N.S.S.C.); affirmed 2009
NSCA 42, 2009 CarswellNS 219 (N.S.C.A.) — The plaintiff was a travel agency that
brought an action against the defendant, a direct sale tour operator that had recently entered
the Halifax market, in respect of certain of the defendant’s advertisements that ran between
2003 and 2005. The advertisements compared the defendant’s price to the plaintiff’s price.
The plaintiff alleged that the advertisements contravened s. 52 of the Act and sought dam-
ages under s. 36. The court held that only the defendant’s 2004 advertisement had breached
s. 52 and awarded damages of $216,842. The court held that the defendant was required to
compensate the plaintiff for the drop in market share resulting in lost commissions due to the
misleading advertising. To determine the amount of damages, the court estimated the amount
of the plaintiff’s commissions in the absence of the misleading advertising and the amount of
its commissions as a result of it. The court noted that, while a number of factors could have
contributed the plaintiff’s loss, the plaintiff should only be compensated for loss caused by
the defendant’s misleading advertising and calculated damages on that basis. The court re-
94
jected the plaintiff’s claim for a remedy of accounting for profits on the basis that any loss
caused by the defendant’s legitimate competition in the market was not compensable under
s. 36. — See also entry under s. 52.
Laboratoires Servier v. Apotex Inc. (2008), 67 C.P.R. (4th) 241, 2008 CarswellNat 3000
(F.C.T.D.); additional reasons at (2008), 2008 CarswellNat 4195, 70 C.P.R. (4th) 347
(F.C.T.D.); affirmed (2009), 2009 CarswellNat 1922, 75 C.P.R. (4th) 443 (Fed. C.A.) — The
Act
plaintiff, Laboratoires Servier and its corporate affiliates, manufactured and distributed a
drug used primarily to treat hypertension. The drug’s active ingredient, perindopril, was pro-
tected by a patent owned by the plaintiff. The plaintiff sued Apotex for patent infringement.
Apotex counterclaimed that, among other things, the manner in which the plaintiff had ob-
tained the patent — through a court-approved settlement with other drug manufacturers —
breached s. 45 of the Act, giving rise to damages under s. 36. The defendant’s counterclaim
was dismissed. The court noted that a plaintiff must establish that the defendant did “some-
thing more” than merely exercise its patent rights for a court to find a contravention of s. 45
and that there was no evidence the plaintiff had obtained market power by methods other
than authorized under the Patent Act. The court held that the plaintiff was merely exercising
its right under the Patent Act to obtain a patent and nothing more. Courts have consistently
held that the existence of a patent is not an offence under the Competition Act. The court
distinguished this case from Eli Lilly & Co. v. Apotex Inc. (2004), 32 C.P.R. (4th) 195 (Fed.
C.A.). In that case, an agreement to assign patents was entered into after the patent grants so
those parties already held the level of market power granted to them by the patents. In this
case, the court-approved settlement entered into by the plaintiff and other drug manufactur-
ers occurred prior to the patent grant and, therefore, no market power could exist until the
patent was issued. The court also held that, even if its conclusion on the defendant’s counter-
claim was wrong, the claim was beyond the two-year limitation set out in subs. 36(4). In
obiter, the court suggested that if the common law discoverability rule applied, it would not
assist the defendant in this case because the defendant would have known about the settle-
ment approximately six years prior to the commencement of its counterclaim.
Matoni v. C.B.S. Interactive Multimedia Inc., 2008 CarswellOnt 228 (Ont. S.C.J.); additional
reasons at 2008 CarswellOnt 5077 (Ont. S.C.J.); additional reasons at 2008 CarswellOnt
5076 (Ont. S.C.J.); additional reasons at 2008 CarswellOnt 7185 (Ont. S.C.J.) — Two for-
mer students in the defendant’s dental hygienist program brought a motion to have their
action certified as a class proceeding. The plaintiffs alleged that the defendants breached s.
52 by failing to inform them of the risks of enrolling in a program that was not accredited by
the applicable professional body and sought damages under s. 36. The court dismissed the
certification motion for the Competition Act claims because the loss or damage suffered as a
result of the false or misleading representation was not a common issue for all class
members.
Hyprescon Inc. v. IPEX Inc. (2007), 2007 CarswellOnt 2046 (Ont. S.C.J.) — The plaintiff
fabricator of concrete pressure pipes alleged that the defendant manufacturer of plastic pip-
ing products made false or misleading representations to four municipalities for the purpose
of promoting the supply of its products. The plaintiff claimed that the defendant acted con-
trary to s. 52 of the Act, and sought damages under s. 36 of the Act. The defendant took the
position that no cause of action could be proven unless the plaintiff could establish that there
was reliance on the representation, and that the representation caused loss to the plaintiff.
The plaintiff was given leave to amend its pleading to claim a violation of s. 52 of the Act.
The common law elements of a claim in misrepresentation were not necessarily required to
establish a breach of s. 52(1) of the Act. The causal connection between the alleged breach
of the Competition Act, and the damage claimed by the plaintiff was no less than the causal
95
connection in Apotex Inc. v. Hoffman-LaRoche Ltd. (2000), 9 C.P.R. (4th) 417 (Ont. C.A.),
and therefore it could not be said that it was plain and obvious that the claim of the plaintiff
would fail because no pleading of reliance on a misrepresentation was made.
Axiom Plastics Inc. v. E.I. Dupont Canada Co. (2007), 87 O.R. (3d) 352, 46 C.P.C. (6th) 234
(Ont. S.C.J.); leave to appeal refused (2008), 55 C.P.C. (6th) 118 (Ont. Div. Ct.) — The
plaintiff, who brought a motion to certify the action as a class proceeding, alleged that the
defendant, through vertical conspiracies with its distributors and certain manufacturers in the
automotive industry, unlawfully fixed prices of engineering resins contrary to ss. 45(1) and
61. The plaintiff sought damages under s. 36. The certification motion was granted with
respect to the price-fixing claim against the defendant and its distributors, on the condition
that the class definition be narrowed to include only purchasers who were required by a
customer to use engineering resins manufactured by the defendant. The court held that, on
the narrowed class definition, there would be some basis in fact that each purchaser of engi-
neering resins from the defendant suffered some loss as a result of the price-fixing conspir-
acy. The certification motion was denied with respect to the price-fixing claim against the
defendant and its manufacturers because there were insufficient common issues on which to
grant certification.
Harmegnies c. Toyota Canada, 2007 QCCS 539, 2007 CarswellQue 926 (Que. S.C.); af-
firmed 2008 QCCA 380, 2008 CarswellQue 1155 (Que. C.A.); leave to appeal refused 2008
CarswellQue 9014 (S.C.C.) — The applicant applied for authorization to institute a class
proceeding against Toyota alleging that Toyota and its dealers conspired to unduly restrict
competition and artificially inflate the price of vehicles. The applicant sought damages under
s. 36 for breach of ss. 45(1)(b), 52(1) and 61(1). Prior to this case, the Competition Bureau
had commenced an investigation and reached a settlement with Toyota pursuant to which
Toyota admitted, at least implicitly, that there may have been a breach of ss. 52 and 61 and
therefore paid an amount of $2.3 million to various charitable organizations. The application
for authorization to institute a class action was dismissed because there were too many dif-
ferences between the class members, including the elements giving rise to liability. The
judge also held that the applicant had failed to provide prima facie evidence that a loss had
been sustained. The Court of Appeal dismissed the appeal. The Court of Appeal concluded
that it is not sufficient to make a vague, general and imprecise allegation. The applicant
bears the burden of adducing evidence of harm and cannot expect that harm will be pre-
sumed because the respondent allegedly broke the law. The Court of Appeal also noted that a
class action is not the way to punish someone who breaks the law, but rather only a way to
compensate a group of persons who have actually suffered similar losses.
Apotex Inc. v. Laboratoires Fournier S.A., 2006 CarswellOnt 7164, 54 C.P.R. (4th) 241
(Ont. S.C.J.) — The plaintiff generic drug manufacturer sought damages for conspiracy by
the defendant originator drug manufacturers, which delayed the marketing of a generic drug
by bringing two unsuccessful prohibition proceedings. The plaintiff claimed conspiracy at
common law and under ss. 36 and 45 of the Act. The defendants sought to strike out the
claim as the plaintiff failed to plead the required facts to support its allegation of conspiracy.
The conspiracy pleadings under the Act were permitted to stand. To support a pleading of
conspiracy, the plaintiff must identify the alleged conspirators, the agreement to conspire,
the improper purpose, the actions taken, and the damage that resulted. The pleading require-
ments did not oblige a plaintiff to provide such a detailed level of specificity at this stage of
the proceeding. The defendants had sufficient detail to reasonably draft, serve and file a
statement of defence.
Tele-Mobile Co., a Partnership v. Bell Mobility Inc. (2006), 46 C.P.R. (4th) 146 (B.C. S.C.
[In Chambers]); additional reasons at 2006 CarswellBC 2462 (B.C.S.C. [In Chambers]); ad-
96
ditional reasons at 2006 CarswellBC 2482 (B.C.S.C. [In Chambers]) — The plaintiff and the
defendant developed a shared high speed broadband wireless voice and data network based
on evolution, data optimized (EV-DO) technology. The network allowed the plaintiff and the
defendant to offer wireless services at a higher data transfer rate than their principal competi-
tor. The defendant began offering EV-DO service in some parts of Canada in October 2005.
The defendant developed advertisements announcing that it was the only provider of services
Act
based on the EV-DO standard, and that the defendant’s services were more than five times
faster than its competition in Canada. The defendant’s advertising campaign began in No-
vember 2005, one week after the plaintiff launched its EV-DO service. The plaintiff notified
the defendant that its advertising claims were erroneous, and the defendant took steps to
correct or remove the advertisements. The plaintiff applied for an interim injunction prohib-
iting the defendant from publishing or distributing the advertising materials. A senior officer
of the defendant committed by affidavit to cease the advertising at issue. The application for
the interim injunction was dismissed. Where the defendant has stated his intention not to
engage in the conduct that aggrieves the plaintiff, any claim for irreparable harm was specu-
lative and could not justify the extraordinary remedy of an injunction.
351694 Ontario Ltd. v. Paccar of Canada Ltd. (2004), 35 C.P.R. (4th) 257 (F.C.T.D.) —
The plaintiffs operated two truck sales, parts and service dealerships pursuant to agreements
with the defendant manufacturer and distributor of trucks and parts. The dealership agree-
ments were for three-year periods, and designated an area of primary marketing responsibil-
ity for each dealer. While the dealers were legally free to sell outside of their designated
area, such sales were actively discouraged. There were also discussions about deep price
reductions. In response to these issues, the defendant instituted a policy that they would only
ship parts directly to a customer if the customer was located within the dealer’s territory.
When a dispute arose over sales allowance requests, the plaintiffs advised the defendant that
they would not seek a renewal of one dealership agreement. The defendant responded by
advising the plaintiffs that both dealership agreements would be terminated. The plaintiffs
commenced an action for damages pursuant to s. 36 of the Act, on the basis that the defen-
dant had breached the resale price maintenance provisions of the Act. The defendant brought
a motion that the action was barred by the two-year limitation provision in subs. 36(4) of the
Act. The claims based on violations of s. 61(1)(a) of the Act were dismissed. Although an
inference could be drawn that the notice of termination of the agreements was an attempt to
discourage price reductions by other dealers, there was no evidence of further attempts in the
intervening two-year period prior to the application being brought. The claims based on vio-
lations of s. 61(1)(b) of the Act were not dismissed, in relation to the supply of parts, as there
was evidence of a refusal to ship parts outside the particular territory until the date of termi-
nation of the agreement, which was well within the limitation period.
Culhane v. ATP Aero Training Products Inc. (2004), 31 C.P.R. (4th) 113 (F.C.); affirmed
(2005), 39 C.P.R. (4th) 20, 252 D.L.R. (4th) 340 (F.C.A.); leave to appeal refused (2005),
256 D.L.R. (4th) vi (S.C.C.) — The plaintiff was an aviation author who published practice
guides, which were used to prepare for a pilot’s licence. The defendants provided free on-
line Canadian aviation exam guides on the internet. The defendants used to sell their pub-
lished guides, but later offered them free over the internet. The access to the free on-line
exam guides required the user to provide e-mail addresses that the defendants sold to other
businesses. The plaintiff brought an action for a declaration, an injunction and damages,
claiming that the defendants’ conduct amounted to predatory pricing. The plaintiff further
claimed that this was contrary to ss. 36(1) and 50(1) of the Act, which prohibited any busi-
ness from engaging in a policy of selling products at prices unreasonably low, having the
effect of substantially lessening competition, or designed to have that effect. The action was
dismissed. Although the defendants gave away the practice exams for free, they were en-
97
gaged in the business of selling aviation products. Giving away the exam guides for free
suggested an unreasonably low price. However, there was no evidence that the free give-
aways had increased the sales of the defendants’ other products. Furthermore, there was no
evidence that the defendants had a design to substantially lessen competition or eliminate a
competitor. Although the plaintiff experienced sales fluctuations, there were various causal
factors at play, aside from the defendants’ conduct.
Janelle Pharmacy Ltd. v. Blue Cross of Atlantic Canada, 2003 CarswellNS 314, 2003 NSSC
179, 217 N.S.R. (2d) 50, 683 A.P.R. 50, 27 C.P.R. (4th) 19 (N.S. S.C.) — The defendant
health care insurer required each pharmacy to agree to a member pharmacy agreement,
which included a maximum price for pharmaceutical products dispensed to the defendant’s
health care insurance customers, in order to receive direct payment from the defendant. The
defendant’s maximum prices were lower than the amounts charged by the plaintiffs for cus-
tomers of other health care insurers. The plaintiffs, who were independent pharmacies,
brought an action against the defendant under s. 36 of the Act for losses suffered as a result
of an alleged agreement between the defendant and others to unduly lessen competition in
the purchase of pharmaceutical supplies. The plaintiffs alleged that the defendant had market
power over each plaintiff by being able to terminate the agreement if a pharmacy tried to
exceed the maximum prices, causing a loss of purchasers and a loss of market share that
would threaten the economic viability of the plaintiffs. Expert testimony for the defendant
established that the defendant’s share of the market for prescription drug insurance in Nova
Scotia was 22 per cent, and that the plaintiffs’ prescription sales to the defendant’s customers
varied from seven percent to 13.3 per cent. In dismissing the action, the court concluded that
the defendant was not a buyers cartel, and did not have the degree of market power contem-
plated by s. 45 of the Act. Although a market share of 50 per cent may not need to be
reached in every case, the market share must be substantial, and in any event, more substan-
tial than the evidence indicated. There was nothing inherently wrong in the buyer attempting
to get the best possible price, and in doing so setting maximum prices. When these practices
are combined with agreements which have the purpose of preventing or lessening competi-
tion unduly, then they fall within the offence created in the Act.
Chadha v. Bayer Inc. (2001), 200 D.L.R. (4th) 309, 54 O.R. (3d) 520, 15 B.L.R. (3d) 177
(Ont. Div. Ct.); reversing (1999), 45 O.R. (3d) 29, 36 C.P.C. (4th) 188 (Ont. S.C.J.); addi-
tional reasons at (1999), 43 C.P.C. (4th) 91 (Ont. S.C.J.); affirmed (2003), 2003 CarswellOnt
49, 223 D.L.R. (4th) 158, 168 O.A.C. 143, 63 O.R. (3d) 22, 31 B.L.R. (3d) 214, 23 C.L.R.
(3d) 1, 31 C.P.C. (5th) 40 (Ont. C.A.); additional reasons at (2003), 2003 CarswellOnt 1205,
170 O.A.C. 126 (Ont. C.A.); leave to appeal refused (2003), 2003 CarswellOnt 2810, 2003
CarswellOnt 2811 (S.C.C.) — The plaintiffs’ motion to certify a class action claiming dam-
ages for a price fixing conspiracy in breach of s. 45 of the Act was granted. The plaintiffs
alleged that the defendants conspired to fix the price of iron oxide pigment used in construc-
tion materials resulting in higher prices for homes purchased by consumers. The recognized
class consisted of purchasers of homes who were thereby indirect purchasers of the construc-
tion materials. The defendant appealed, and the Divisional Court overturned the decision of
the motions judge. The action was not appropriate for certification under the Class Proceed-
ings Act, 1992. For a class action, the plaintiffs must establish that they have suffered loss or
injury as a result of the actions of the defendants, but in this case, it could only be done on an
individual basis and not a class-wide basis. The problem of proof was exacerbated by the
fact that the product in question was used merely as a small component in another product or
series of product, and the alleged overcharge was only an insignificant part of the purchase
price of the home. Even if the plaintiffs could prove that the defendants engaged in a con-
spiracy, the plaintiffs would still have to establish that the price increase was passed on to
the plaintiffs, which they were unable to do on a class-wide basis. Although statistical evi-
98
dence could be used for determining issues relating to the amount or distribution of a mone-
tary award, such evidence was not admissible for determining liability or resolving the “pass
on” problem.
Ford v. F. Hoffman-La Roche Ltd. (2002), 2002 CarswellOnt 235, 20 C.P.C. (5th) 351 (Ont.
S.C.J.); leave to appeal quashed (2002), 2002 CarswellOnt 1797, 23 C.P.C. (5th) 230 (Ont.
C.A.) — The plaintiffs brought five class actions alleging losses and damages in Canada,
Act
due to alleged worldwide price fixing conspiracies in respect of vitamins and related prod-
ucts. The defendants include multinational corporations based in Europe, with subsidiaries
located in North America. The plaintiffs alleged breaches of s. 45 of the Act, together with
civil conspiracy and other torts. Five of the corporate defendants brought motions challeng-
ing the jurisdiction of the court on the basis that the case did not satisfy the criteria for
service ex juris, and there was no jurisdiction simpliciter. The defendants submitted that they
did not conduct business in Canada nor have sufficient connection with Canada or Ontario.
In dismissing the jurisdiction motion, the court found there was a good arguable case that
any conspiracy entered into abroad, that fixed prices or allocated markets in Canada so as to
create losses through artificially higher prices in Canada, would give rise to a tort of civil
conspiracy in Canada. Moreover, s. 45 of the Act was not limited to conspiracies entered into
within Canada. The court also found a good arguable case for service ex juris on the basis
that the tort was committed in Ontario due to the damages occurring in Ontario. As for the
criteria of carrying on business in Ontario, the court held that, if the conspiracies were
proven, it was arguable that the price fixing scheme created outside Canada but implemented
in Canada through subsidiaries, constituted carrying on business in Canada on the part of the
co-conspirators. The court concluded that the alleged conspiracy created a real and substan-
tial connection with Ontario where the damage was suffered in Ontario.
Alfresh Beverages Canada Corp. v. Hoechst AG, 2002 CarswellOnt 77, 16 C.P.C. (5th) 301
(Ont. S.C.J.) — The plaintiffs commenced a class action in Ontario with respect to an al-
leged conspiracy to fix the prices and allocate the market shares of sorbates. The plaintiffs
sought damages for the class pursuant to s. 36 of the Act, as a result of the alleged contraven-
tion of s. 45 of the Act. The Ontario action included all class members in Canada other than
residents of British Columbia and Quebec where companion class actions had been com-
menced. Pursuant to settlement agreements entered into, the plaintiffs moved for final ap-
proval of the settlement in the class proceedings in Ontario. The court found that the criteria
for certification required by s. 5(1) of the Ontario Class Proceedings Act, 1992, S.O. 1992,
c. 6 were satisfied for purposes of completing the disposition of this proceeding. The court
further concluded that the proposed settlement represented a reasonable compromise of what
would have been expensive, complex and risky litigation. Even though the defendants did
not represent the entire sorbates market, they did dominate the world market for this product.
The settlement paid damages to all purchasers of sorbates on the assumption that non-con-
spiring suppliers would have increased their price as a result of the increase created by the
conspiracy. However, under the settlement, a reduced amount was paid to purchasers from
non-conspiring suppliers given the problematic nature of a court action by such class
members.
VitaPharm Canada Ltd. v. F. Hoffmann-La Roche Ltd., 2002 CarswellOnt 235, [2002]
O.T.C. 57, 20 C.P.C. (5th) 351 (Ont. S.C.J.) — The moving defendants submitted that an
agreement made outside of Canada to lessen competition or fix prices in the Canadian mar-
ket is not conduct contrary to s. 45 such as to give rise to a claim for damages under s. 36.
They argued that s. 45 renders a conspiracy to fix prices a criminal offence only when the
agreement is made within Canada. The court disagreed. The language of s. 45 is not directed
to only those conspiracies entered into within Canada. There is a good arguable case that any
99
conspiracy entered into abroad that fixes prices or allocates markets in Canada so as to create
losses through artificially higher prices in Canada, gives rise to the tort of civil conspiracy in
Canada. The most significant aspect of the alleged conspiracy, being the artificial raising of
prices in Canada, is implemented within Canada and the agreement is directed at Canadian
consumers.
Wong v. Sony of Canada Ltd., 2001 CarswellOnt 1546, 9 C.P.C. (5th) 122 (Ont. S.C.J.) —
The plaintiff, in a prospective class action, alleged that the defendant committed false and
misleading advertising by publishing a suggested price list to be shown to customers, and an
actual price list containing prices that were lower than those in the suggested price list. The
plaintiff also alleged that the prices in the actual price list were higher than would be the case
in a competitive market, and therefore the defendant engaged in resale price maintenance by
imposing the actual price list as a minimum price. The plaintiff, in its claim for relief, sought
punitive damages. In the defendant’s motion to strike out the statement of claim as failing to
disclose a reasonable cause of action, the motion was allowed in part. The claim for punitive
damages was struck-out as s. 36(1) of the Act did not permit punitive damages. As the defen-
dant sold its products through both independent retailers and company owned stores, the use
of price lists allowed the defendant to maintain high retail prices at its own stores. It was
arguable that customers purchasing from company owned stores were persons who had suf-
fered loss or damage within the meaning of s. 36(1) of the Act. Accordingly, it could not be
said that the statement of claim did not disclose a reasonable cause of action by class mem-
bers who were customers of the company owned stores.
Balanyk v. University of Toronto, 1999 CarswellOnt 1786, 1 C.P.R. (4th) 300 (Ont.
S.C.J.) — The plaintiff co-invented a dental polish while doing post-graduate work at the
defendant university. He assigned the invention to the defendant foundation which licensed
it to the defendant licensee. The plaintiff alleged, inter alia, that the defendants made false
representations to the public regarding the efficacy of the invention in breach of ss. 52(1)(a),
(b) and (3) of the Act. The defendants brought a motion to strike out all or portions of the
statement of claim. The motion was granted. The pleadings did not give particulars of con-
duct sufficient, if proved, to constitute conduct prohibited by this statute. In pursuing such a
civil claim, the plaintiff had to rely on s. 36 which required that the plaintiff suffered a loss
or damages as a result of conduct contrary to Part VI of that Act. The plaintiff failed to
allege any such loss or damages.
Forest Protection Ltd. v. Bayer AG (1998), (sub nom. Forest Protection Act v. Bayer A.G.)
84 C.P.R. (3d) 187, (sub nom. Forest Protection Act v. Bayer A.G.) 169 D.L.R. (4th) 374,
207 N.B.R. (2d) 50, 529 A.P.R. 50 (N.B. C.A.). After the defendants pleaded guilty to a
price-fixing conspiracy, the plaintiffs sued the defendants for damages suffered due to in-
creased costs resulting from the conspiracy. Prior to the conspiracy charges under the Act,
the Director prepared a summary of evidence which was forwarded to the Attorney General
of Canada. During the plea bargain negotiations, the Attorney General sent a copy of a por-
tion of the investigative summary to the defendants, who subsequently pleaded guilty. In the
civil proceedings, the plaintiffs sought production of the summary received by the defend-
ants. The defendants refused and claimed privilege. One of the defendants also refused to list
in its affidavit of documents or produce correspondence between counsel of the defendant
and its European parent corporation. A motions judge ruled that all of the contested docu-
ments were privileged and not subject to production. The plaintiffs appealed and the appeal
was allowed in part. The investigative summary prepared by the Director in order to advise
the Attorney General was privileged under the Act. The summary was provided to the de-
fendants as part of the plea bargain or settlement, and therefore remained privileged. Moreo-
ver, the privilege did not expire with the guilty plea. The term “record of proceedings” under
100
subs. 36(2) did not include documents beyond the record of proceedings in court. In regard
to the correspondence, all documents must be identified and listed in the affidavit of docu-
ments, and be subjected to examination for discovery with respect to the grounds of any
privilege claimed.
North York Branson Hospital v. Praxair Canada Inc. (1998), 84 C.P.R. (3d) 12 (Ont. Gen.
Div.); leave to appeal refused (1999), 1999 CarswellOnt 450 (Ont. Div. Ct.) — The plaintiff
Act
hospitals and health care centres claimed damages pursuant to s. 36 based on the price-fixing
conspiracy of the defendants in breach of s. 45 of the Act. The defendants had previously
pleaded guilty for breaching s. 45 for the period from June 1989 to May 1990. The plaintiffs
also alleged a civil conspiracy commencing in 1954. Some of the defendants moved to strike
out the claim relating to the civil conspiracy. The motion was dismissed. In this case, the
pleading precisely stated the relationship among the parties, the agreement between the de-
fendants to conspire and stated the purpose or objectives of the alleged conspiracy. The
pleading contained sufficient clarity and precision of the overt acts alleged to have been done
by each conspirator and alleged injury and damage.
Mil Davie Inc. v. Hibernia Management & Development Co., 1998 CarswellNat 814, 85
C.P.R. (3d) 320 (Fed. C.A.) — The motions judge found that the statement of claim failed to
allege a factual basis for a claim based on conspiracy under s. 45 of the Act, and ordered a
stay of the proceedings. The plaintiff’s appeal from the judgment was granted. The motions
judge misdirected himself when concluding that there were only three-bald assertions of
anti-competitive activity which were unsubstantiated with specific facts or proper factual
basis. While the plaintiff could have made a better presentation of the facts in the statement
of claim, there was a sufficient factual basis to substantiate jurisdictional facts as well as a
reasonable cause of action under s. 36.
Boehringer Ingelheim (Canada) Inc. v. Bristol-Myers Squibb Canada Inc., 1998 Carswell-
Ont 3893, 83 C.P.R. (3d) 51 (Ont. Gen. Div.) — The defendant was the only supplier of a
certain cancer medication and the plaintiff introduced a competing generic drug at a much
lower price. The defendant subsequently lowered its price to match that of the plaintiff re-
sulting in the plaintiff achieving a much smaller market penetration than would normally be
expected. The plaintiff also alleged that the defendant made false representations concerning
the plaintiff’s product. The plaintiff commenced an action relying upon several causes of
action including relief under s. 36 in respect of alleged predatory pricing. The defendant was
granted a summary judgment dismissing the predatory pricing claim. Even if the defendant
had sold below cost, the price reduction may be justified where it was done to meet a low
price of a competitor. The defendant’s reductions were not out of line with those of the
plaintiff, who was the attacker.
Belsat Video Marketing Inc. v. Astral Communications Inc., 1998 CarswellOnt 659, 81
C.P.R. (3d) 1 (Ont. Gen. Div.); additional reasons at 1998 CarswellOnt 1612 (Ont. Gen.
Div.); affirmed 1999 CarswellOnt 388 (Ont. C.A.) — The plaintiff was a joint venture part-
nership between the defendant A and another party which was formed for the purpose of
supplying video racking services to large retail chains. The joint venture agreement con-
tained a non-competition clause that was effective upon the termination of the joint venture.
After the termination of the joint venture agreement, the plaintiff brought a court action
against the defendant A and other defendants, inter alia, for breach of the non- competition
clause, breach of fiduciary duty and for refusal to supply contrary to the Competition Act.
The defendants successfully brought motions for summary judgment dismissing the action.
The plaintiff only had a direct business relationship with the defendant A, and as a result, the
claim for the breach of the non-competition clause was dismissed. The claim for refusal to
supply based on s. 75 of the Competition Act was also dismissed. Section 75 was a review-
101
able practice under the jurisdiction of the Competition Tribunal, and did not support a civil
cause of action.
Carom v. Bre-X Minerals Ltd. (1998), 82 C.P.R. (3d) 187, 20 C.P.C. (4th) 187 (Ont. Gen.
Div.) — The plaintiffs in their class action claimed damages from the defendants for losses
suffered due to the purchase of shares of the mining company. The causes of action asserted
by the plaintiffs included a claim based on a breach of the misleading advertising provision
of the Competition Act, and alleged representations relating to the secondary sale of the
shares. The defendants brought a motion seeking to strike out the cause of action relating to
the Competition Act as the application of the Act to the facts in this case constituted an
unconstitutional incursion into provincial jurisdiction. The motion was dismissed. The con-
stitutionality of predecessors to the Act and s. 36 were upheld by the Supreme Court of
Canada. Although the scope of s. 52 may be so broad as to encompass behaviour that is not
anti-competitive, it was arguable that the facts as pleaded could be anti-competitive in their
effect. Accordingly, it was best to leave this issue to the trial judge.
R. v. Consolidated Fastfrate Transport Inc. (1995), 24 O.R. (3d) 564, 40 C.P.C. (3d) 160, 61
C.P.R. (3d) 339, 99 C.C.C. (3d) 143, 125 D.L.R. (4th) 1, 83 O.A.C. 1 (C.A.) — The Crown
sought a Mareva injunction to prevent an accused from transferring assets so that there
would be sufficient assets to pay a fine under the Competition Act if the accused was con-
victed. The court held that in “exceptional circumstances” the court may grant a Mareva
injunction in aid of the criminal law. In determining whether these exceptional circum-
stances exist, the Crown bears a higher burden of proof that a plaintiff in a civil case. The
principles to be applied in determining whether a Mareva injunction should be granted in aid
of the criminal law are:
(1) the accused must have assets in the jurisdiction;
(2) the Crown must show a strong prima facia case that the accused will “likely” be
convicted and that the amount of the fine will “likely” exceed the assets sought to be
attached;
(3) the Crown must prove that the accused is or has been dissipating or transferring its
assets for the purpose of avoiding payment of a fine in the event of conviction; and
(4) the Crown must give the usual undertaking as to damages.
On the merits of the case, the Crown did not satisfy the burden of proof necessary to enable
the court to grant a Mareva injunction.
The seeking of a Mareva injunction is not under s. 33, rather it is civil in nature.
Dominion Ready Mix Inc. c. Rocois Construction Inc., (sub nom. Rocois Construction Inc. v.
Québec Ready Mix Inc.) [1990] 2 S.C.R. 440, 31 Q.A.C. 241, 112 N.R. 241 (S.C.C.) —
Where there is an identity of parties, object and cause between the two cases, a plaintiff
cannot simultaneously pursue an action in Superior Court relying on its general common law
jurisdiction and in Federal Court relying on the jurisdiction conferred by this section. The
identity of what is claimed in each of the actions does not have to be absolute for there to be
identity of object. Where additional amounts for costs are claimed, these are incidental and
do not affect the real object of the actions. That there may be two applicable rules of law
does not necessarily mean that there are distinct causes. When the essence of the legal char-
acterization of the facts alleged is identical under either rule, it must follow that there is
identity of cause. Minor differences regarding applicable forms of proof cannot affect iden-
tity of legal principles.
Pindoff Record Sales Ltd. v. CBS Music Products Inc. (1989), 44 C.P.C. (2d) 308, 27 C.P.R.
(3d) 380 (Ont. H.C.) — The question of whether a civil cause of action can be founded on
102
conduct in the nature of a breach of Part VIII of the Act should be put to the trial judge and
not be determined by a motions court judge on a preliminary application to dismiss or to
strike portions of the statement of claim. It is not an offence under s. 45(1)(c) or s. 46 to
lessen competition while not acting in conjunction with another person nor while acting with
an affiliated company. However, a company can conspire with its personnel, although not
with high placed officers. It would therefore be premature to strike out a statement of claim
Act
alleging conspiracy by a company, apparently acting alone, prior to examinations for discov-
ery at which such a conspiracy might be established.
Industrial Milk Producers Assn. v. British Columbia (Milk Bd.) (1988), [1989] 1 F.C. 463,
18 F.T.R. 147, 21 C.P.R. (3d) 33, 47 D.L.R. (4th) 710 (T.D.) — Under the regulated industry
defence, a provincial marketing board cannot be charged under s. 45 for activities engaged in
when exercising authority granted by provincial or federal statute. When so acting, a board is
deemed to be acting in the public interest. This applies even where a plaintiff is pursuing a
civil remedy under s. 36, as to have such a civil cause of action the plaintiff must prove the
same elements as must be proven for a criminal offence under s. 45.
Regatta Investments Ltd. v. Shell Can. Products Ltd. (1988), 23 C.P.R. (3d) 378 (Man.
Q.B.) — Where a plaintiff’s only cause of action rests on this section, damages will be lim-
ited to special damages.
Westfair Foods Ltd. v. Lippens Inc., [1987] 6 W.W.R 629, 49 Man. R. (2d) 220, 44 D.L.R.
(4th) 145 (Q.B.); affirmed (1989), [1990] 2 W.W.R. 42, 30 C.P.R. (3d) 209, 61 Man. R. (2d)
282, 64 D.L.R. (4th) 335 (C.A.); leave to appeal refused (1990), 106 N.R. 16 (note), 65 Man.
R. (2d) 80 (note), 30 C.P.R. (3d) 209 (note) (S.C.C.) — A civil cause of action exists inde-
pendent of the Act for unlawful interference with economic interests and for conspiracy.
Breach of the Act can be used in this context as proof of the unlawful means of a conspiracy
or an unlawful interference with economic interests. The remedy offered under the Act is
supplementary to existing rights of action under the common law and hence a plaintiff is not
limited to a claim for special damages as provided for by this section. To have limited ex-
isting rights would have constituted an intrusion on provincial jurisdiction. The wording of
the section does not suggest such an intention but rather purposefully avoids such intrusion.
ACA Joe Int. v. 147255 Can. Inc. (1986), 10 C.P.R. (3d) 301, 4 F.T.R. 311 (T.D.) — The
remedy under this section is confined to damages and does not include injunctive relief.
Procter & Gamble Co. v. Kimberly-Clark of Can. Ltd. (1986), 21 C.I.P.R. 317, 12 C.P.R.
(3d) 430 (Fed. T.D.) — The defendants in a civil patent action claimed damages by way of a
counterclaim under this section for an illegal combination or conspiracy by the plaintiffs,
who were parent and subsidiary. The plaintiffs moved to strike the counterclaim on the
grounds that affiliates cannot conspire. The application was dismissed but the defendants
were required to amend the counterclaim to specify any alleged parties to the conspiracy
who were not affiliates, which might include the company from whom the plaintiffs had
purchased the patent.
Rocois Construction Inc. v. Que. Ready Mix Inc., [1985] 2 F.C. 40, 32 B.L.R. 213, 24 C.C.C.
(3d) 158, 8 C.P.R. (3d) 145, (sub nom. Pilote Ready Mix Inc. v. Rocois Construction Inc.) 25
D.L.R. (4th) 373 (C.A.); affirmed [1989] 1 S.C.R. 695, 48 C.C.C. (3d) 501, 25 C.P.R. (3d)
304, 60 D.L.R. (4th) 124 — Section 31.1(1)(a) [now s. 36(1)(a)] is within federal jurisdiction
as having a rational connection with the overall federal economic plan manifested in the Act
in relation to competition, which plan also satisfies all the criteria of validity under the fed-
eral trade and commerce power. A civil remedy must be genuinely and bona fide integral
with the overall plan of supervision, but the personal remedy in damages in s. 31.1(1) [now
s. 36(1)] was clearly conceived as an integral part of the overall plan. The legislative aim
103
was evidently a more complete and more effective system of enforcement in which public
and private initiative can both operate to motivate and effectuate compliance. Within reason-
able limits, Parliament must be free to adopt and even to experiment with various approaches
to the regulation of the economy. The Federal Court of Canada has jurisdiction with respect
to proceedings under this section because the prerequisite that there be existing and applica-
ble federal law in support of those proceedings has been met.
City Nat. Leasing Ltd. v. Gen. Motors of Can. Ltd. (1984), 47 O.R. (2d) 653, 28 B.L.R. 41,
45 C.P.C. 174, 3 C.P.R. (3d) 262, 12 D.L.R. (4th) 273 (H.C.); reversed in part (1986), 54
O.R. (2d) 626, 9 C.P.R. (3d) 134, 28 D.L.R. (4th) 158 (C.A.); affirmed [1989] 1 S.C.R. 641,
68 O.R. (2d) 512 (note), 43 B.L.R. 225, 24 C.P.R. (3d) 417, 58 D.L.R. (4th) 255, 93 N.R.
326, 32 O.A.C. 332 — Section 31.1 [now s. 36], which provides a civil remedy to persons
who have suffered loss or damage as a result of conduct contrary to certain sections of the
Act, is constitutionally valid legislation of the Parliament of Canada. The Act itself is valid
federal legislation under the trade and commerce power. This section intrudes on a provin-
cial power but it is sufficiently related to the general object of the Act and to the structure
and content of the scheme to be constitutionally valid.
Henuset Bros. Ltd. v. Syncrude Can. Ltd., [1980] 6 W.W.R. 218, 52 C.P.R. (2d) 173, 33 A.R.
199, 114 D.L.R. (3d) 300 — Although it affects to some degree property and civil rights in
the provinces, s. 31.1 [now s. 36] forms an integral part of an overall legislative and regula-
tory scheme for the regulation of trade and commerce throughout Canada, and accordingly is
a valid exercise of the federal trade and commerce power. It does not fall within the criminal
law power or the peace, order and good government power.
Subsection (4)
Garford Pty Ltd. v. Dywidag Systems International Canada Ltd., 2012 FCA 48 (Fed.
C.A.) — The effects of a price fixing conspiracy do not form part of the conspiracy offence
under s. 45, and therefore do not extend the limitation time period established in subs. 36(4).
The offence under s. 45 is complete upon the finalization of an agreement that, if carried into
effect, would unduly limit competition. Without deciding if the discoverability principle is
legally available in the context of the s. 36 limitation period, the court held that the discover-
ability principle was not available given the evidence and facts of the case.
Price v. Panasonic Canada Inc., 2000 CarswellOnt 2931 (Ont. S.C.J.) — The plaintiff
brought a claim for damages under the Competition Act, and also sought a mandatory order
preventing the defendant from denying future claims by dealers for co-op advertising reim-
bursement. The defendant applied to strike out the portions of the claim in respect of
breaches of the Act occurring more than two years before the commencement of the claim
and also sought to strike out the request for a mandatory order. The court held that the issue
of whether portions of the claim were statute-barred should be deferred until after the defen-
dant had properly pleaded the limitation period as a defence. As there was no provision in
the Act for mandatory orders in civil claims, the plaintiff was permitted to amend its claim
accordingly.
Bérubé v. Makita Power Tools Canada Ltd. (1991), 40 C.P.R. (3d) 108, 47 F.T.R. 287 (Fed.
T.D.) — Bringing criminal proceedings will only suspend the two-year limitation period for
the bringing of civil proceedings under subs. 36(4) of the Act if the criminal charges relate
specifically to the conduct complained of in the civil action.
104
Part VI — Offences (ss. 45-62) S. 45(3)
PART V — (SS. 37–44)

37. [Repealed R.S.C. 1985, c. 19 (2nd Supp.), s. 29.]
Act
PART VI — OFFENCES IN RELATION TO COMPETITION

(SS. 45–62)
45. (1) Conspiracies, agreements or arrangements between com-

petitors — Every person commits an offence who, with a competitor of that
person with respect to a product, conspires, agrees or arranges
(a) to fix, maintain, increase or control the price for the supply of the
product;
(b) to allocate sales, territories, customers or markets for the production
or supply of the product; or
(c) to fix, maintain, control, prevent, lessen or eliminate the production or
supply of the product.
(2) Penalty — Every person who commits an offence under subsection (1) is
guilty of an indictable offence and liable on conviction to imprisonment for a
term not exceeding 14 years or to a fine not exceeding $25 million, or to both.
(2.1) [Repealed 2009, c. 2, s. 410.]
(2.2) [Repealed 2009, c. 2, s. 410.]
(3) Evidence of conspiracy, agreement or arrangement — In a
prosecution under subsection (1), the court may infer the existence of a con-
spiracy, agreement or arrangement from circumstantial evidence, with or
without direct evidence of communication between or among the alleged par-
ties to it, but, for greater certainty, the conspiracy, agreement or arrangement
must be proved beyond a reasonable doubt.
105
(4) Defence — No person shall be convicted of an offence under subsection

(1) in respect of a conspiracy, agreement or arrangement that would otherwise
contravene that subsection if
(a) that person establishes, on a balance of probabilities, that
(i) it is ancillary to a broader or separate agreement or arrangement
that includes the same parties, and
(ii) it is directly related to, and reasonably necessary for giving effect
to, the objective of that broader or separate agreement or arrange-
ment; and
(b) the broader or separate agreement or arrangement, considered alone,
does not contravene that subsection.
(5) Defence — No person shall be convicted of an offence under subsection
(1) in respect of a conspiracy, agreement or arrangement that relates only to
the export of products from Canada, unless the conspiracy, agreement or
arrangement
(a) has resulted in or is likely to result in a reduction or limitation of the
real value of exports of a product;
(b) has restricted or is likely to restrict any person from entering into or
expanding the business of exporting products from Canada; or
(c) is in respect only of the supply of services that facilitate the export of
products from Canada.
(6) Exception — Subsection (1) does not apply if the conspiracy, agreement
or arrangement
(a) is entered into only by parties each of which is, in respect of every one
of the others, an affiliate;
(b) is between federal financial institutions and is described in subsection
49(1); or
(c) is an “arrangement”, as defined in section 53.7 of the Canada Trans-
portation Act, that has been authorized by the Minister of Transport
under subsection 53.73(8) of that Act and for which the authorization has
not been revoked, if the conspiracy, agreement or arrangement is directly
related to, and reasonably necessary for giving effect to, the objective of
the arrangement.
(7) Common law principles — regulated conduct — The rules and
principles of the common law that render a requirement or authorization by
or under another Act of Parliament or the legislature of a province a defence
to a prosecution under subsection 45(1) of this Act, as it read immediately
before the coming into force of this section, continue in force and apply in
respect of a prosecution under subsection (1).
(7.1) [Repealed 2009, c. 2, s. 410.]
(8) Definitions — The following definitions apply in this section.
106
Part VI — Offences (ss. 45-62) S. 45
“competitor” includes a person who it is reasonable to believe would be likely

to compete with respect to a product in the absence of a conspiracy, agreement
or arrangement to do anything referred to in paragraphs (1)(a) to (c).
(“concurrent”)
“price” includes any discount, rebate, allowance, price concession or other ad-
Act
vantage in relation to the supply of a product. (“prix”)
R.S.C. 1985, c. 19 (2nd Supp.), s. 30; 1991, c. 45, s. 547; 1991, c. 46, s. 590; 1991, c.
47, s. 714; 2009, c. 2, s. 410; 2018, c. 8, s. 110; 2018, c. 10, s. 85
Commentary
Subsection (1)
Subsection (1) provides that “[e]very person commits an offence who, with a competitor of
that person with respect to a product, conspires, agrees or arranges (a) to fix, maintain, in-
crease or control the price for the supply of the product; (b) to allocate sales, territories,
customers or markets for the production or supply of the product; or (c) to fix, maintain,
control, prevent, lessen or eliminate the production or supply of the product.” Private actions
to recover damages for violations of the provision are possible under section 36 of the Act.
The current s. 45 entered into force in March 2010. Conduct carried out prior to March 2010
should be assessed pursuant to the criminal provision as it existed at the time. Conduct car-
ried out after March 2010 should be assessed pursuant to the new criminal provision.
A civil provision, section 90.1, permits the Competition Bureau to seek remedial cease-and-
desist orders (not fines or imprisonment) with respect to agreements between competitors
that substantially lessen or prevent competition. Private enforcement and damage awards are
not possible in connection with section 90.1.
Assessment of the legality of proposed arrangements under subsection 45(1) will in some
cases be difficult because of the absence of any enforcement history or jurisprudence, al-
though existing case law considering the phrase “conspires, combines, agrees or arranges”
will presumably be relevant under the new provision (which similarly requires that a defen-
dant “conspires, agrees or arranges”). Subsection 45(1) does appear to apply only to agree-
ments relating to supply or production and not to agreements between competitors to
purchase a product or service.
Senior Competition Bureau staff have repeatedly stated that subsection 45(1) will only apply
in connection with “the most egregious forms of cartel agreement” and that other forms of
competitor collaboration will be assessed under the new civil provision. Competitor collabo-
ration enforcement guidelines echo that enforcement policy approach. An agreement must
directly relate to one or more of the three subjects covered in paragraphs 45(1)(a), (b) or (c).
If not, an agreement should be assessed under section 90.1. Thus, an agreement on informa-
tion exchange, for example, should not violate subsection 45(1) because it is not an agree-
ment to fix prices, allocate sales, fix production, etc. However, subsection 45(1) is still capa-
ble of broad application. Bureau policy and enforcement guidelines will not bind private
parties or the courts (or indeed the Bureau). If private parties (continue to) bring cases under
section 36 for damages caused by breaches of subsection 45(1), it may be that the contours
of the new provision will be shaped by private and not public enforcement.
On its face, subsection 45(1) appears to apply to the sale of products and services and not the
supply of products and services. The Commissioner of Competition in the Competitor Col-
laboration Guidelines (Ottawa: Competition Bureau, December 2009) limits this interpreta-
107
tion to paragraph 45(1)(a) to exempt joint purchasing arrangements. From time to time,
Competition Bureau officials have taken the view that “anti-poaching” agreements — agree-
ments between competitors not to hire each other’s employees — are covered by subsection
45(1). That would presumably be based on an interpretation of paragraphs 45(1)(b) or (c) to
the effect that two or more competitors have agreed or arranged to control the supply of
(third party) labour. (“Product” is defined in subsection 2(1) as including an “article or ser-
vice.”) Although it may be possible to interpret the section in such a manner, it is not an
obvious interpretation and doing so seems inconsistent with the spirit of the section and the
Competitor Collaboration Guidelines. From a legal certainty and enforcement policy per-
spective, it would therefore be preferable to rely on section 90.1 with respect to arrange-
ments or arrangements relating to the supply of products or services.
In its Competitor Collaboration Guidelines (Ottawa: Competition Bureau, December 2009),
the Bureau notes that “[w]here an agreement involves competing and non-competing parties,
the fact that some parties are not competitors does not insulate the competing parties from
prosecution under section 45. Parties that are not competitors may also be prosecuted under
section 45 through the aiding and abetting provisions in section 21 or the counselling provi-
sions in section 22 of the Criminal Code (the “Code”) in circumstances where the conditions
of those sections are met.”
See also subsection 34(2) of the Interpretation Act, R.S.C. 1985, c. I-21, which states: “All
the provisions of the Criminal Code relating to indictable offences apply to indictable of-
fences created by an enactment, and all the provisions of that Code relating to summary
conviction offences apply to all other offences created by an enactment, except to the extent
that the enactment otherwise provides.” As the Competition Act does not provide otherwise,
ss. 21 (aiding or abetting), 22 (counselling), 23 (accessory after the fact) and 24 (attempt) of
the Code apply to all of the offences in the Act, including subsection 45(1).
See also R. v. Campbell, [1964] 2 O.R. 487, [1964] 3 C.C.C. 112, 46 D.L.R. (2d) 83; af-
firmed without written reason [1966] 4 C.C.C. 333n (S.C.C.), where it was held that al-
though the Combines Investigation Act, R.S.C. 1952, c. 314, did not refer to aiding and abet-
ting, it did not exclude the application of s. 21 of the Criminal Code, S.C. 1953-54, c. 51,
and s. 28 of the Interpretation Act, R.S.C. 1952, c. 158, and that its language would have to
be much stronger to do so. The Crown was therefore entitled to invoke s. 21 of the Code by
preferring charges of aiding and abetting.
An area not covered in detail in the Competitor Collaboration Guidelines, is — pre-merger
coordination and information exchanges between merging parties. Prior to the introduction
of a per se criminal offence, pre-merger information exchange would have had to have been
particularly egregious in order to meet the undue lessening of competition standard under
section 45. Indeed, there were no reported cases involving a section 45 prosecution for an
information exchange in a legitimate merger transaction. Although these cases will continue
to be uncommon in Canada, coordination between merger parties prior to the consummation
of a merger should be a matter to be mindful of in M & A transactions. For an overview of
the US approach to the topic, see The Rhetoric of Gun-Jumping: Remarks Before the Associ-
ation of Corporate Counsel Annual Antitrust Seminar of Greater New York Chapter — Key
Developments in Antitrust for Corporate Counsel by William Blumenthal, General Counsel,
Federal Trade Commission (New York, 10 November 2005).
Additional information on the Bureau’s approach to the enforcement of section 45 may be
found in its Competitor Collaboration Guidelines (Ottawa: Competition Bureau, December
2009) as well as various public statements by Competition Bureau officials such as Speaking
Notes for Melanie L. Aitken, Interim Commissioner of Competition Canadian Bar Associa-
tion, Competition Law Section, 2009 Spring Forum (Toronto, 12 May 2009).
108
Prosecuting domestic and international cartels under section 45 (and section 46) is an en-
forcement priority for the Bureau and, as part of that program of enforcement, the Bureau
has developed Immunity and Leniency Programs that prescribe the circumstances in which
parties that violate the conspiracy and other criminal offence provisions of the Act may seek
immunity or leniency from prosecution. The Immunity and Leniency Programs have been
remarkably successful. By encouraging parties to cooperate with the Bureau in its investiga-
Act
tions in exchange for immunity or leniency, the Bureau has been able to gather evidence that
has facilitated the prosecution of over 200 parties with resulting fines of over $228 million.
See Immunity and Leniency Programs Under the Competition Act (Ottawa: Competition Bu-
reau, 2019). For an overview of the Bureau’s immunity and leniency programs, see: Antonio
Di Domenico, Competition Enforcement and Litigation in Canada (Toronto: Emond Mont-
gomery Publications Limited, 2019) at Chapter 6.
Subsection (2)
The maximum penalty under subsection 45(2) of 14 years imprisonment is consistent with
the maximum penalty for other serious criminal offences under the Criminal Code such as
fraud. Bid-rigging under section 47 is similarly subject to a maximum term of imprisonment
of 14 years. The maximum fine was set at $25 million in part to distinguish the penalty for
the criminal offence of price-fixing from civil administrative monetary penalties under the
abuse of dominance provisions of the Act of $10 to $15 million.
In practice, the quantum of a fine is usually determined pursuant to Competition Bureau
enforcement policies that outline the method that the Bureau will use in determining the
magnitude of the fine it will recommend to the Public Prosecution Service of Canada. The
starting point for assessing a potential fine is to determine the relevant affected volume of
commerce or VOC. In establishing the base level of an appropriate fine recommendation, the
Bureau generally uses a proxy of 20 percent of the cartel participant’s affected VOC in Can-
ada. The 20 percent figure includes two components:
• 10 percent of the affected volume of commerce in Canada as a proxy for the over-
charge resulting from the cartel activity and other types of economic harm; and
• 10 percent of the affected volume of commerce for deterrence and to ensure that the
fine is sufficiently large that it does not represent a mere “cost of doing business”.
The fine level, estimated using 20 percent of the affected volume of commerce, may then be
adjusted up or down depending on the weight assigned by the Bureau to relevant aggravating
or mitigating factors. The weight ascribed to each factor in a given case is determined ac-
cording to the facts of the case. Relevant mitigating factors include making restitution to
victims and implementing a corporate compliance program. Relevant aggravating factors in-
clude destroying relevant records and attempting to conceal assets in order to show that an
applicant is not capable of paying a fine.
After the 20 percent proxy has been increased or reduced to account for any aggravating or
mitigating factors, the Bureau will assign a “leniency discount” to the fine for parties that co-
operate with the Bureau investigation pursuant to the Bureau’s Leniency Program. For ex-
ample, the first leniency applicant is eligible for a reduction of 50 percent of the fine that
would otherwise have been recommended.
If a leniency applicant discloses evidence of conduct constituting a further criminal offence
under the Act that is unknown to the Bureau, the applicant may be eligible for “immunity
plus” status. In such a case, the leniency applicant may receive immunity from prosecution
109
in respect of the newly disclosed offences. In addition, the Bureau will typically recommend
a further five to 10 percent be added to the applicant’s leniency discount.
In cases where the 20 percent proxy is greater than the statutory maximum for a fine, the
starting point for the Bureau’s assessment of the fine level for that applicant will be the
statutory maximum.
Pursuant to the Safe Streets and Communities Act, S.C. 2012, c. 1, which amended ss. 742 to
742.7 of the Criminal Code, judges no longer have the discretion to impose conditional
sentences on individuals for crimes carrying a maximum penalty of 14 years imprisonment.
Fines are still available, as are suspended sentences with probation. Conditional sentences
remain available for parties convicted under the former s. 45.
Subsection (3)
This subsection was originally enacted in 1986.
Subsection (4)
Subsection 45(4) establishes the “ancillary restraints defence” pursuant to which parties to an
agreement or term of an agreement that contravenes the prohibitions in subsection 45(1) will
not be convicted of an offence under subsection 45(1) if the agreement or term of the agree-
ment is directly related to and reasonably necessary for giving effect to a broader and lawful
agreement. The defence applies to restraints on competition that are reasonably necessary to
accomplish legitimate objectives. Thus, for example, a non-compete provision in a purchase
and sale agreement would normally be considered ancillary to the purchase agreement.
the Competition Bureau summarises subsection 45(4) as follows: “[i]n short, to invoke the
defence, the parties to the agreement must establish that the challenged restraint does not
represent the object of their cooperation, but rather constitutes a matter functionally inciden-
tal and subordinate to the main purpose or end of their collaboration.”
Constitutional challenges to subsection 45(4) should be expected. The issue is whether the
defence would violate the presumption of innocence protected under section 11(d) of the
Charter of Rights and Freedoms. If it does, it may nevertheless be found to be permitted by
section 1, which authorises “such reasonable limits [to the rights and freedoms protected by
the Charter that are] prescribed by law as can be demonstrably justified in a free and demo-
cratic society.”
Subsection (5)
Subsection 45(5) establishes a defence from prosecution under subsection 45(1) for export
cartels, subject to the conditions set out in the subsection. In its Competitor Collaboration
Guidelines (Ottawa: Competition Bureau, December 2009), the Competition Bureau notes
that “[a]n export agreement that benefits from the defence in subsection 45(5) may be sub-
ject to prosecution or other proceedings in the jurisdictions to which products are exported
under the agreement.”
Subsection (6)
Paragraph 45(6)(a) provides an exception for conspiracies, agreements or arrangements that
are entered into between affiliates. The definition of affiliate is set out in subsection 2(2) and
can include corporations, partnerships, sole proprietorships, trusts or other unincorporated
organizations capable of conducting business.
110
Paragraph 45(6)(b) provides an exception where the agreement is between federal financial
institutions as described in subsection 49(1) of the Act. Criminal prosecution under subsec-
tion 45(1) could, however, be possible where the subject-matter of the agreement falls
outside the scope of subsection 49(1) or an exemption in subsection 49(2). Agreements be-
tween federal financial institutions may also be subject to review under section 90.1.
Sections 4, 5 and 6 of the Act provide for a number of exemptions relating to collective
Act
bargaining, underwriting and amateur sport that would apply to section 45.
Although there are, generally speaking, no exemptions to subsection 45(1) other than those
in the Competition Act, an exception to that rule is the Shipping Conferences Exemption Act
1987, R.S.C., 1985, c. 17 (3rd Supp.), which exempts the Competition Act from applying to
certain shipping conference agreements.
The Canada Transportation Act contains a voluntary review and approval process that en-
ables the Minister of Transport to determine whether an airline joint venture agreement or
arrangement is in the public interest. If so, it will be exempt from sections 45, 47, 90.1 and
91 of the Act. This exemption does not extend to other civil reviewable practices provisions,
such as section 76 (price maintenance) and section 79 (abuse of dominance). Under this new
process, the Commissioner will provide a report to assist the Minister of Transport in the
latter’s review. If the Minister of Transport is satisfied that the proposed arrangement is in
the public interest, he or she has the authority to approve it (and specify any terms and
conditions relating to the public interest and competition), without separate approval from
the Commissioner. See the Guidelines for the Assessment of Air Carrier Joint Ventures (Ot-
tawa: Transport Canada, 2019).
Based on the wording of these provisions, it does not appear that this voluntary review re-
gime extends to existing arrangements. Further, it is clear from the definition of “arrange-
ment” under the Canada Transportation Act that this review regime does not apply to trans-
actions that are subject to pre-merger notification under Part IX of the Act.
Subsection (7)
Subsection 45(7) allows defendants to advance a “regulated conduct defence” which, if suc-
cessful, would allow a defendant to avoid criminal liability on the basis that the activity in
question was authorised or carried out pursuant to a valid scheme of provincial or federal
regulation. The Ontario Court of Appeal in Hughes v. Liquor Control Board of Ontario,
2019 ONCA 305 (Ont. C.A.), determined that impugned conduct may be impliedly author-
ized by valid provincial or federal legislation — in other words, the regulated conduct de-
fence does not require the state to explicitly authorize the impugned conduct.
The reference to the common law in subsection 45(7) creates some uncertainty because the
common law includes the decision of the Supreme Court in Garland v. Consumers’ Gas Co.,
[2004] 1 S.C.R. 629 (S.C.C.), in which the Court held that the defence only applies where
the criminal offence with which the defendant has been charged either expressly or by neces-
sary implication contemplates that there will be exceptions to its application. Pursuant to
Garland, the criminal offence must contain “leeway” language referring to the “public inter-
est” or requiring that there be an “undue lessening of competition.” Such language would
allow a court to reconcile the two statutory provisions (i.e., the provincial or federal regula-
tion and the criminal offence) on the basis that a validly enacted scheme of regulation could
not be contrary to the public interest or unduly lessen competition. It is not clear how the
Garland decision can be reconciled with a per se criminal offence such as that created by
subsection 45(1), which appears to grant no leeway for any of the prohibited conduct to be
authorised or carried out pursuant to a regulatory scheme. (See also The Commissioner of
111
Competition v. Vancouver Airport Authority, 2019 Comp. Trib. 6 (Competition Trib.), in

which the Tribunal considered whether the regulated conduct defence applies in the context
of an alleged abuse of dominance. The Tribunal found that, as a matter of law, it does not
apply because section 79 does not contain the “leeway” language to allow the regulated
conduct defence doctrine to be invoked. See the case commentary below.)
the Bureau attempts to address this uncertainty by pointing out that subsection 45(7) pro-
vides that the regulated conduct doctrine applies to subsection 45(1) as it applied to subsec-
tion 45(1) prior to the March 2010 amendment which removed the undue lessening of com-
petition requirement. That is, the regulated conduct defence will continue to apply as if
section 45 still contained an “undue lessening of competition” requirement. As such, the
Bureau will apply the approach to the regulated conduct doctrine articulated in its Bulletin,
titled: “Regulated” Conduct (Ottawa: Competition Bureau, September 2010).
See generally, The “Regulated Conduct Defence” in Canada by Mark Katz and Charles
Tingley in Competition Law, Volume IX, No. 2 (Ottawa: Federated Press, 2006).
Subsection (8)
Subsection 45(8) defines the words “competitor” and “price.”
Subsection 45(8) provides that “competitor” “includes” potential competitors. Use of the
verb “includes” casts some doubt on the precise scope of the definition. The drafters likely
intended subsection 45(8) to clarify that the offence applies to conduct involving both “ac-
tual competitors and potential competitors” but the definition leaves open the theoretical
possibility that the offence could also apply to a more expansive group of “competitors.”
Whether or not the parties to an agreement were or would have been “competitors” in the
absence of the agreement could be a subject of dispute in a section 45 case. In its Competitor
Collaboration Guidelines (Ottawa: Competition Bureau, December 2009), the Bureau states
that it “is of the view that it is not required to engage in a detailed definition of the relevant
market(s).” However, some sort of marketplace assessment will be necessary in some cases
to determine whether parties were or would have been competitors. The well-established
approach to market definition outlined in the Bureau’s Merger Enforcement Guidelines
(Competition Bureau: Ottawa, 2011) provides an analytical framework that may help deter-
mine whether parties to an agreement were or could have been competitors in the absence of
the agreement.
In R. v. Electrical Contractors’ Assn. (1961), [1961] O.R. 265, 1961 CarswellOnt 26, 36
C.R. 1, 27 D.L.R. (2d) 193, 37 C.P.R. 1, 131 C.C.C. 145 (Ont. C.A.), the Ontario Court of
Appeal held that a trade association and corporation were capable of conspiring even though
the same individual was an officer of the trade association and a director of the corporation.
Case Law
The Commissioner of Competition v. Vancouver Airport Authority, 2019 Comp. Trib. 6 —
In response to an application brought by the Commissioner of Competition under section 79
alleging that the Vancouver Airport Authority (VAA) decreased competition among in-flight
catering companies at Vancouver International Airport (YVR) by denying new in-flight ca-
tering suppliers access to the airport, VAA sought to rely on the regulated conduct defence to
shield it from scrutiny under section 79 by asserting that, as the regulator of access at YVR,
it acted in accordance with its statutory mandate to operate the airport in furtherance of the
public interest. The Tribunal found that, as a matter of law, the regulated conduct defence
did not apply to section 79 because: (i) it does not contain the “leeway” language to allow
112
the regulated conduct defence doctrine to be invoked; and (ii) the rationales that supported
the development of the doctrine (i.e., balancing the weight of the stigma of a criminal of-
fence and giving precedence to provincial legislation) did not apply to that particular case.
Moreover, as a matter of fact, no legal instrument required, directed, mandated or authorized
VAA to engage in the impugned conduct. See the commentary to section 79 for additional
information.
Act
Hughes v. Liquor Control Board of Ontario, 2019 ONCA 305 (Ont. C.A.) — The appellants
alleged that a framework agreement between the Liquor Control Board of Ontario and Brew-
ers Retail violated section 45(1) of the Competition Act because the parties conspired to
divide the beer market between themselves. The Court held that the Liquor Control Act au-
thorized the impugned conduct and that the regulated conduct defence is applicable to sec-
tion 45. The regulated conduct defence does not require the state to explicitly authorize the
impugned conduct — the power can also be “necessarily implied”.
Moreover, the word “authorization” in section 45(7) does not require the conduct to be ex-
plicitly authorized by the statute. Therefore, the regulated conduct defence insulated the re-
spondents from liability under the Competition Act in relation to the framework agreement.
Dow Chemical Canada ULC v. NOVA Chemicals Corporation, 2018 ABQB 482 (Alta.
Q.B.) — Provisions in a joint venture agreement between Dow and NOVA imposing restric-
tions on Dow’s ability to acquire ethane, inhibiting its ability to compete with NOVA, were
found to contravene section 45(1) of the Act pre-March 12, 2010. The court held that, post-
2010 amendments to the Act, agreements between competitors that affect only the purchase
of a product are no longer prima facie prohibited by section 45(1), but could be prohibited
under section 90.1. NOVA argued that the court should show deference to the Competition
Bureau’s issuance of an ARC with respect to the joint venture and its subsequent issuance of
an ARC with respect to the Dow/Union Carbide Corporation (the party that originally en-
tered into the joint venture agreement with NOVA) merger. The court determined that a
court has jurisdiction to determine whether conduct contravenes section 45(1) of the Act
even where the Competition Bureau has reviewed such conduct and decided not to challenge
it by pursuing the matter before the Competition Tribunal. The court also considered whether
the ancillary restraints defence could apply, despite holding that, post-2010 amendments to
the Act, section 45(1) does not apply to agreements between competitors that affect only the
purchase of a product. It found that the defence did not apply in the circumstances because
the 80-year duration of the restrictions in the joint venture agreement far exceeded any pe-
riod that could have been considered reasonably necessary for the protection of any NOVA
interest with respect to the joint venture. NOVA’s records showed that it anticipated it would
earn a positive return from its investment in the joint venture after just 8 years. The court
also considered whether the restrictions contravened section 90.1 of the Act and concluded
that they did. See also the commentary to section 90.1.
R. c. Gosselin, 2017 QCCA 244, 2017 CarswellQue 883 (C.A. Que.); leave to appeal refused
2017 CarswellQue 6860, 2017 CarswellQue 6861 (S.C.C.); R. c. Gosselin, 2013 QCCS 717
(C.S. Que.) — The word “ok,” as an acknowledgement of information received, can be in-
dicative of an agreement when it is consistent with participation in a conspiracy. There was
no explicit agreement between the competitors to fix prices. The Court heard expert evidence
that the conspiracy had an undue effect on competition in the relevant markets, a now re-
pealed element of the offence. The Court found that the markets of Sherbrooke and Magog,
Quebec experienced a statistically significant and otherwise unexplained increase in prices
(relative to a nearby reference city) during the period of the cartel’s existence. An appeal of
the conviction and the sentence were both dismissed.
113
Shah v. LG Chem, Ltd., 2015 ONSC 2628 (Ont. S.C.J.) — An Ontario court does not have
jurisdiction simpliciter over foreign defendants alleged to have conspired to fix the price of
rechargeable lithium ion batteries where the foreign defendants do not carry on business in
Ontario, were not parties to a conspiracy to fix prices in Ontario, and it was not reasonably
foreseeable that the batteries manufactured by the foreign defendants would make their way
through normal channels of trade to Ontario.
R. c. Couche-Tard inc., 2014 QCCA 1456, 2014 CarswellQue 14609 (C.A. Que.); R. c.
Couche-Tard inc., 2012 CarswellQue 10745, [2012] J.Q. No. 8109 (C.S. Que.); affirmed
2014 CarswellQue 7899, 2014 CarswellQue 14609 (C.A. Que.) — The Court overturned the
Director of Public Prosecutions’ decision to resile from a plea agreement in a case where
Couche-Tard was charged with fixing retail gas prices under s. 45. Although the repudiation
of the plea agreement itself was not an abuse of process, because Couche-Tard was induced
to disclose its defence to accusations of conspiracy, Couche-Tard’s right to a fair hearing
was compromised and the proceedings were ordered to be stayed. The Superior Court deci-
sion was upheld on appeal for substantially the same reason.
R. c. Drouin, 2010 CarswellQue 2248 (Que. C.A.) — The defendant, who plead guilty to a s.
45 charge and later made a $10,000 donation to the United Way, was granted an absolute
discharge at trial pursuant to subs. 730(1) of the Criminal Code. Subsection 730(1) permits a
court to grant a guilty individual an absolute or conditional discharge, unless the offence has
a minimum prescribed punishment or is punishable by imprisonment for 14 years or for life.
Leave for appeal was denied.
Rogers Communications Inc. v. Shaw Communications Inc., 2009 CarswellOnt 5849 (Ont.
S.C.J.) — Rogers brought a motion for an interlocutory injunction to restrain Shaw from
acquiring a broadband wireline cable business in Hamilton on the basis that Shaw was bound
by a restrictive covenant in an agreement between Rogers and Shaw which prohibited Shaw
from acquiring any broadband wireline cable business in Ontario, Quebec or Atlantic Can-
ada. The covenant was contained in an agreement that was approved by the CRTC prior to
completion. The motion was dismissed because Rogers was unable to satisfy the three-part
test for injunctions. The court rejected Roger’s argument that the restrictive covenants were
immune from scrutiny because the agreement had been authorized by the CRTC. The CRTC
had not authorized the restrictive covenants but rather merely had approved the transaction.
Shaw had a good case that the restrictive covenants were contrary to the public interest and a
good case that the covenants were contrary to former para. 45(1)(d) of the Act.
Bernstein v. Stoytcheva-Todorova (2007), 44 C.C.L.T. (3d) 181 (B.C. S.C.) — Stoytcheva-
Todorova commenced a counterclaim alleging that Bernstein was engaged in a conspiracy.
The alleged conspiracy related to a manufacturer’s refusal to provide its product to Stoytch-
eva-Todorova because it supplied Bernstein, a competitor of Stoytcheva-Todorova. The
counterclaim was dismissed. For there to be a conspiracy, there must be an agreement with a
second party or evidence from which an agreement can be inferred. In this case, the manu-
facturer refused to fill the order placed by Stoytcheva-Todorova because of an internal pol-
icy to refuse to supply to new customers, such as Stoytcheva-Todorova, who had set up a
competing business after leaving an existing customer. Whether or not Bernstein had trig-
gered the operation of the manufacturer’s internal policy or took some satisfaction from its
operation vis-à-vis Stoytcheva-Todorova was insufficient in this case to constitute a conspir-
acy contrary to s. 45.
Apotex v. Laboratoires Fournier S.A. (2006), 54 C.P.R. (4th) 241 (Ont. S.C.J.) — The plain-
tiff generic drug manufacturer sought damages for conspiracy by the defendant originator
drug manufacturers, which delayed the marketing of a generic drug by bringing two unsuc-
cessful prohibition proceedings. The plaintiff claimed conspiracy at common law and under
114
ss. 36 and 45 of the Competition Act. The defendants sought to strike out the claim as the
plaintiff failed to plead the required facts to support its allegation of conspiracy. The conspir-
acy pleadings under the Competition Act were permitted to stand. To support a pleading of
conspiracy, the plaintiff must identify the alleged conspirators, the agreement to conspire,
the improper purpose, the actions taken, and the damage that resulted. The pleading require-
ments did not oblige a plaintiff to provide such a detailed level of specificity at this stage of
Act
the proceeding. The defendants had sufficient detail to reasonably draft, serve and file a
statement of defence. Furthermore, the various subsections of s. 45 were not so distinct that a
failure to plead specific subsections would alter the nature of the obligation.
Eli Lilly & Co. v. Apotex Inc. (2005), 44 C.P.R. (4th) 1 (F.C.A.); reversing (2004), 35 C.P.R.
(4th) 155, [2005] 2 F.C.R. 225 (F.C.) — The plaintiff alleged that the defendant had in-
fringed eight patents owned by the plaintiff. Four of the patents had been assigned to the
plaintiff by the patent holder. The defendant alleged that this assignment resulted in the
plaintiff controlling all of the commercially viable processes for making a particular antibi-
otic. Before the assignment, those processes were controlled by the two companies. The
defendant maintained that the assignment agreement gave rise to an undue lessening of com-
petition in violation of s. 45 of the Act, and counterclaimed for damages. The plaintiff and
the patent holder moved for summary judgment striking out certain paragraphs of the state-
ment of defence and counterclaim, and dismissing the counterclaim against the patent holder.
The motions judge granted the motion as the agreement dealt only with patent rights, and
was itself specifically authorized by the Patent Act. Moreover, any resulting lessening of
competition, being authorized by Parliament, was not “undue” and was not an offence under
s. 45 of the Act. The defendant appealed, and its appeal was allowed. The assignment of a
patent may, as a matter of law, unduly lessen competition. Section 50 of the Patent Act does
not immunize the assignment of patents from s. 45 of the Competition Act when the effect of
the assignment was to increase the assignee’s market power by more than that inherent in the
patent rights assigned. Since s. 50 of the Patent Act neither compels nor expressly authorizes
what s. 45 of the Competition Act forbids, there is no true conflict between these two provi-
sions. The question for trial was whether the lessening of competition was sufficiently signif-
icant as to be undue.
Apotex Inc. v. Eli Lilly & Co. (2005), 40 C.P.R. (4th) 289 (F.C.A.) — The plaintiff alleged
that the defendant had infringed eight patents owned by the plaintiff, of which four had been
assigned to the plaintiff by the patent holder. The defendant submitted that the assignment
gave rise to an undue lessening of competition in violation of s. 45 of the Act. The plaintiff
and the patent holder moved for summary judgment striking out certain paragraphs of the
statement of defence and counterclaim, and dismissing the counterclaim against the patent
holder. The motions judge granted the motion as the agreement dealt only with patent rights,
and was itself specifically authorized by the Patent Act. The defendant appealed, and the
Commissioner of Competition sought leave to intervene in the appeal. The leave application
was granted. The Commissioner was directly affected by the appeal, and was also affected
by the interpretation of the Intellectual Property Enforcement Guidelines. The Commis-
sioner’s ability to administer the Competition Act in respect of patent rights could be affected
by the outcome of the appeal as the outcome could remove the assignment of patents from
her jurisdiction under s. 45 of the Act. The relationship between s. 50 of the Patent Act and s.
45 of the Competition Act involved a question of statutory interpretation that was plainly
justiciable and of public interest.
VitaPharm Canada Ltd. v. F. Hoffmann-La Roche Ltd., 2002 CarswellOnt 235, [2002]
O.T.C. 57, 20 C.P.C. (5th) 351 (Ont. S.C.J.) — The moving defendants submitted that an
agreement made outside of Canada to lessen competition or fix prices in the Canadian mar-
115
ket is not conduct contrary to s. 45 such as to give rise to a claim for damages under s. 36.
They argued that s. 45 renders a conspiracy to fix prices a criminal offence only when the
agreement is made within Canada. The court disagreed. The language of s. 45 is not directed
to only those conspiracies entered into within Canada. There is a good arguable case that any
conspiracy entered into abroad that fixes prices or allocates markets in Canada so as to create
losses through artificially higher prices in Canada, gives rise to the tort of civil conspiracy in
Canada. The most significant aspect of the alleged conspiracy, being the artificial raising of
prices in Canada, is implemented within Canada and the agreement is directed at Canadian
consumers.
Ed Miller Sales & Rentals Ltd. v. Caterpiller Tractor Co., 17 Alta. L.R. (3d) 251, 54 C.P.R.
(3d) 1, [1994] 5 W.W.R. 473, 151 A.R. 1 (Q.B.); additional reasons at (1994), 26 Alta. L.R.
(3d) 16, [1995] 3 W.W.R. 716, 170 A.R. 341 (Q.B.) — In the absence of express authority to
the contrary, the common law tort of conspiracy is not subsumed by the statute, so the civil
common law evidentiary rules continue to apply where the statute is silent. Satisfying the
common law requirements of proof would satisfy the statutory requirements, absent express
words to the contrary.
R. v. Dave Spear Ltd (1986), 11 C.P.R. (3d) 63 (Ont. H.C.) — After deciding to raise its
body shop labour rate and having been asked to put this in writing by one insurance com-
pany one of the accused wrote to the other body shops in the area asking if they wished their
names included on the letter. Thirteen shops agreed and accordingly a letter was sent to
appraisers, insurance companies, insurance adjusters and the body shops setting out the new
rate. A similar letter was sent 11 months later with 11 other shops named. On the basis of
these letters the accused were charged under this section. The two letters, as well as the fact
that the body shops all did raise their rates at about the same time, strongly imply an agree-
ment to fix rates but are also consistent with a leading shop deciding on ordinary business
considerations to raise its rate and other shops, agreeing with the reasons, deciding to do
likewise. It was a reasonable inference from the evidence that the latter view was correct and
hence there was a reasonable doubt that the accused were acting pursuant to an agreement.
Furthermore, the evidence did not establish that the effect of the alleged agreement was to
lessen competition to the point that the accused could carry on their businesses virtually
unaffected by competition. The charges were accordingly dismissed.
Subsection (1)
Ed Miller Sales & Rentals Ltd. v. Caterpillar Tractor Co., 17 Alta. L.R. (3d) 251, 54 C.P.R.
(3d) 1, [1994] 5 W.W.R. 473, 151 A.R. 1 (Q.B.); additional reasons at (1994), 26 Alta. L.R.
(3d) 16, [1995] 3 W.W.R. 716, 170 A.R. 341 (Q.B.) — The plaintiff was in the business of
selling, renting and servicing heavy equipment and replacement parts, including those of the
defendant manufacturer. The defendant dealer was the exclusive authorized dealer of the
manufacturer in the province, and the plaintiff obtained the manufacturer’s goods on the
“grey market” through the manufacturer’s offshore dealers. The manufacturer instituted an
allocation programme whereby some of its dealers would receive machines in excess of the
demand in their territory while other’s would have a scarcity of machines. It had a price
protection policy for its dealers, but the policy limited the price protection offered to resel-
lers such as the plaintiff. Its parts transhipment policy prohibited dealers in the United States
from reselling parts to any other reseller for export from the United States. Its dealers were
required to charge a 5 per cent service fee on any sales outside of their service territory.
Prices charged to dealers varied from time to time between the manufacturer’s marketing
subsidiaries. The manufacturer’s policy that all sales were to pass title at the point of origin
resulted in artificial transportation costs for the plaintiff. The plaintiff sued the defendants,
116
including a claim for common law conspiracy and the action was allowed in part on other
grounds. To succeed in an action for common law conspiracy, the plaintiff had to prove an
agreement between two or more persons to act unlawfully or to injure the plaintiff, with a
common intention, resulting in damage to the plaintiff. To balance its interests, the manufac-
turer encouraged individual authorized dealers to believe that they operated within exclusive
territories while at the same time tolerating intra-brand competition within those territories.
Act
A number of the economic mechanisms relied upon by the plaintiff as evidence of conspir-
acy were merely strategems adopted by the manufacturer to perpetuate the myth of exclusive
territory. The allocation system encouraged trade in the grey market in which the plaintiff
operated, and the manufacturer had legitimate reasons for concern about the type of transac-
tions for which price protection was available as it bore the costs of price protection itself.
The parts transhipment policy was a unilateral act by the manufacturer and not part of any
common design, nor was thereany common design in its selling its equipment at a discount
to its dealers. The 5 per cent service fee fairly reflected the costs of providing product sup-
port driven by currency fluctuations. The manufacturer’s sales policy, which had resulted in
higher transportation costs to the plaintiff, had proceeded on a principled basis to give the
manufacturer control over its internal production and distribution (based on Competition Act,
R.S.C. 1970, c. C-34, s. 31.1).
Du Pont Canada Inc. v. Dennis (1993), 50 C.P.R. (3d) 53 (Ont. Gen. Div.) — Where a party
makes a unilateral decision to cease selling to one company and to commence selling to
another company, there is no conspiracy. The defendant’s company bought the plaintiff’s
products and resold them. The defendant signed a written guarantee which guaranteed pay-
ment for products to be supplied by the plaintiff to the defendant. The plaintiff stopped sell-
ing to the defendant and began selling to a third party. The defendant owed a debt to the
plaintiff but resisted judgment, claiming the plaintiff was involved in a conspiracy with the
third party, in breach of the Competition Act. The plaintiff’s motion for summary judgment
was granted because his decision to cease selling to the defendant and commence selling to
another company was a unilateral one and did not constitute a conspiracy.
R. v. Mediacom Indust. Inc. (1985), 3 C.P.R. (3d) 47 (Ont. H.C.) — The accused are entitled
to have stated in plain terms in an indictment for conspiracy the nature and effect of the
unlawful agreements alleged. An order that the Crown provide particulars may be made
under the Criminal Code, R.S.C. 1970, c. C-34, s. 516(1), if this is not done.
A.G. Can. v. Law Soc. of B.C.; Jabour v. Law Soc. of B.C., [1982] 2 S.C.R. 307, [1982] 5
W.W.R. 289, 37 B.C.L.R. 145, 19 B.L.R. 234, 66 C.P.R. (2d) 1, 137 D.L.R. (3d) 1, 43 N.R.
451; affirming [1981] 2 W.W.R. 159, 24 B.C.L.R. 1, 53 C.P.R. (2d) 87; which reversed
[1979] 4 W.W.R. 385, 45 C.P.R. (2d) 163, 98 D.L.R. (3d) 442 — The activities of the
benchers of the Law Society of British Columbia under the authority of the Legal Profes-
sions Act, R.S.B.C. 1960, c. 214 (see now Barristers and Solicitors Act, R.S.B.C. 1979, c.
29), do not constitute an offence under this subsection since the Act can be properly inter-
preted so as not to interfere with the Legal Professions Act. The words creating the offence
are not the kind ordinarily used to apply to a group that is proceeding as a deliberative body
whose existence is mandated by a provincial statute. The addition of subs. (6) did not alter
this since it is a defence creating provision, not an expansion of the charging provision.
R. v. St. Lawrence Corp., [1969] 2 O.R. 305, 7 C.R.N.S. 265, 59 C.P.R. 97, [1969] 3 C.C.C.
263, 5 D.L.R. (3d) 263; varying 51 C.P.R. 170 (C.A.) — A corporation may be indicted for
an offence under the Act relating to the conduct of an individual who is a vital organ of the
body corporate and virtually its directing mind and will in the sphere of duty and responsibil-
ity assigned to him so that his action and intent are the very action and intent of the company
itself, provided he was acting within the scope of his express or implied authority. A corpo-
117
ration can have more than one directing mind or alter ego, including individuals in branch
offices widely separated from its head office. On a charge of conspiracy it is not necessary
for the prosecution to establish that the agreement or arrangement must have been intended
to have the effect of unduly preventing or lessening competition. That an accused advertently
entered into an agreement which had the effect, or would have the effect, of inducing a
person to resell the accused’s commodities at not less than minimum prices is sufficient to
establish mens rea. Sentence — In imposing fines on the 20 accused varying from $1,000 to
$75,000 the trial judge correctly took into account the following factors:
(1) The size of the companies.
(2) Their share of the market of both container board and shipping containers.
(3) Their position or influence in the conspiracy and the initiative in promoting the
agreement.
(4) Length of time as a member of the conspiracy.
(5) The limit of the penalty during the greater part of the indictment period (as the
offence continued after the amendment removing the limitation, the court is not subject
to the previous limitation).
(6) The penalties levied in previous cases.
(7) The obtaining of and relying upon legal advice from an eminent counsel exper-
ienced in combines law, advice which approved of the proposed agreement and proce-
dure but — I have not overlooked the evidence in respect of the destroying of certain
letters and the effort to disguise the scheme in the beginning.
(8) Previous convictions of the accused herein. In my opinion it is not proper to con-
sider the convictions registered since 1954, that is, after the period to which the indict-
ment herein relates, as such convictions could not be considered as a warning which
the accused herein chose to ignore or defy.
That 17 of the accused pleaded guilty was also relevant.
R. v. Elec. Contr. Assn. of Ont., [1961] O.R. 265, 37 C.P.R. 1, 131 C.C.C. 145, 36 C.R. 1, 27
D.L.R. (2d) 193 (C.A.) — Although one person alone cannot conspire, two separate legal
entities may be found to have conspired even if only one person who was in control of both
was involved.
R. v. Lyons Fuel, Hardware & Supplies Ltd., [1961] O.R. 860, 36 C.R. 156, 131 C.C.C. 189,
30 D.L.R. (2d) 6 (S.C.) — It is not necessary to prove an agreement by writing; it may be
inferred from the circumstances. An agreement fixing prices which gives the parties a virtual
monopoly, eliminating or preventing all competition, is necessarily “undue”. If it is proved
beyond a reasonable doubt that the parties entered into the offending arrangement deliber-
ately, with full knowledge of its effect, it is not necessary to prove they had an intention to
commit a crime.
R. v. Abitibi Power & Paper Co. (1960), 36 C.R. 96, 36 C.P.R. 188, 131 C.C.C. 201 (Que.
Q.B.) — The essence of a conspiracy is an agreement to carry out an unlawful act; such
agreement constitutes the offence, even if nothing is ever done to implement it or if it is
imperfectly implemented. Once an unlawful agreement is established, a single voluntary act
in aid of the execution of the agreement is sufficient to identify an accused with the conspir-
acy and render him liable. Where the evidence for a conspiracy is indirect, the law concern-
ing circumstantial evidence must be applied, and where a fact is capable of giving rise to an
inference which is as consistent with innocence as with guilt, the accused are entitled to have
the fact considered as unproven, in accordance with the rule of Hodge’s Case (1838), 2 Lew.
227. The words “prevent” and “lessen” should be given their ordinary meaning; accordingly
118
it is not necessary that the prevention or lessening of competition be carried to the point
where there is no or virtually no competition. The manner, extent and degree to which com-
petition has been lessened is one, but not the only, factor in determining whether the interfer-
ence with competition was “undue”. Sentence — The 17 accused had conspired over a pe-
riod of 8 years not to compete with one another in the purchase of pulpwood wherever they
would normally have competed in the provinces of Quebec, Ontario and New Brunswick.
Act
Fines varying from $8,000 to $25,000, for a total of $240,000, were imposed.
R. v. D.E. Adams Coal Ltd. (1957), 23 W.W.R. 419, 27 C.R. 47, 29 C.P.R. 163, 119 C.C.C.
350, 65 Man. R. 358 (Q.B.) — Sentence — Whether the offending agreement benefited or
harmed the public is not to be considered in determining the appropriate penalty. Where
there are several accused, a proper approach is to divide them into categories according to
their volume of business and the length of time they participated in the conspiracy, and to
impose a different penalty in each category. Fines varying from $250 to $2,500 for the cor-
porate accused and from $50 to $1,500 for the individual accused were imposed for a con-
spiracy in Greater Winnipeg concerning coal supply contract tenders. Although the scheme
or arrangement had been abandoned, a prohibition order was also granted.
Howard Smith Paper Mills Ltd. v. R., [1957] S.C.R. 403, 29 C.P.R. 6, 26 C.R. 1, 118 C.C.C.
321, 8 D.L.R. (2d) 449 — Conspiracy is a crime by itself, without the necessity of establish-
ing the carrying out of an overt act. Accordingly, the Crown need not establish that the
agreement was detrimental to the public in the sense that the manufacture or production was
effectively lessened, limited or prevented as a result of the agreements entered into. It is also
no defence that the acts complained of were beneficial to the public, their purpose being to
achieve the stabilization of prices and production. The word “unduly” does not change this
interpretation.
A.G. Que. v. Lazarovitch (1940), 69 Que. K.B. 214; affirming in the result, but disapproving
as to this ground (sub nom. Lazarovitch v. Court of Sessions of the Peace) 77 Que. S.C. 68
(C.A.) — Neither the Collective Labour Agreements Act, 1937 (Que.), c. 49 [am. 1938, c.
52], nor agreements and orders in council made thereunder, so far as they affect the relations
between employers and employees and prescribed minimum wages, are in conflict with s.
498 of the Criminal Code, R.S.C. 1927, c. 36, or the Combines Investigation Act, R.S.C.
1927, c. 26.
Lefebvre v. Knott (1907), 32 Que. S.C. 441, 13 C.C.C. 223 — A combination of employers,
for the purpose of resisting the demands of a union for higher wages, did not violate s. 520 of
the Criminal Code, S.C. 1892, c. 29.
R. v. McMichael (1907), 10 O.W.R. 268, 18 C.C.C. 186 (H.C.) — An association of master
plumbers and an association of dealers in plumbing supplies agreed that the plumbers would
buy all their goods from the dealers, that the dealers would not sell to the general public, and
that the dealers would charge plumbers who were not members of the association 20 per cent
more. Since the agreement prevented the general public from purchasing plumbing supplies
and tended to put non-members out of business, it contravened this section. A subsequent
agreement intended to absolutely prohibit sales to non-members, under which a monthly list
of persons to whom sales might be made was to be published and penalties imposed for
breach of the agreement, was likewise contrary to this section. It unduly limited the facilities
for supplying or dealing in plumbing supplies; restrained or injured trade or commerce in
relation thereto; unreasonably enhanced prices; and unduly prevented or lessened competi-
tion in their purchase, sale and supply. The accused took part in the negotiations for the
creation of the combination and signed the agreement as a representative of his company,
and thereafter endeavoured to have his company live up to the terms of the agreement. His
119
conduct was not merely that of acquiescence, and since he actively aided in bringing about
the illegal agreement he was guilty as a principal.
R. v. Master Plumbers etc. Assn. (1907), 14 O.L.R. 295, (sub nom. R. v. Central Supply
Assn.) 12 C.C.C. 371 (C.A.) — Two incorporated bodies may be guilty of conspiracy with-
out a natural person being mentioned as co-conspirator.
Subsection (1)(b)
Bass Clef Entertainments Ltd. v. HOB Concerts Canada Ltd. (2007), 31 B.L.R. (4th) 255
(Ont. S.C.J.) — A concert promotion company commenced an action against a competitor
for entering into a merger with third parties that allegedly resulted in an undue lessening of
competition contrary to s. 45. The plaintiff alleged that the merger established a monopoly in
the concert promotion business, resulting in the termination of the essential business rela-
tionship the plaintiff had enjoyed with the third parties. The action was dismissed because
the merger was not a conspiracy. The judge accepted that the merger was necessary and that,
but for the merger, the third parties would have wound up their concert business.
Subsection (1)(c)
Apotex Inc. v. Eli Lilly & Co., 2004 CarswellNat 1831, 2004 FCA 232, (sub nom. Eli Lilly &
Co. v. Apotex Inc.) 32 C.P.R. (4th) 195, 323 N.R. 180, 240 D.L.R. (4th) 679 (F.C.A) — The
plaintiff alleged that the defendant had infringed eight patents owned by the plaintiff. Four of
the patents had been assigned to the plaintiff by a company. The defendant alleged that these
assignments resulted in the plaintiff controlling all of the commercially viable processes for
making an antibiotic cefaclor. Prior to the assignments, those processes were controlled by
two companies. The defendant alleged that these assignments constituted an agreement that
resulted in an undue lessening of competition contrary to s. 45 of the Competition Act, and
counterclaimed for damages under s. 36 of the Act. The plaintiff and the company moved for
summary judgment striking out certain paragraphs of the statement of defence and counter-
claim, and dismissing the counterclaim against the company. The company also brought a
motion appealing an order of a prothonotary dismissing a motion to strike the counterclaim
against it. The motions were granted, and the defendant appealed. The appeals were allowed.
The motions judge was correct in finding that the decision of the Federal Court of Appeal in
Molnlycke AB v. Kimberly-Clark of Canada Ltd. (1991), 36 C.P.R. (3d) 493 (Fed. C.A.) was
binding on him. However, it was not dispositive of the matter as the case involved a single
supplier lawfully entitled to sell the subject matter of the patent prior to the patent being
assigned. The assignment merely transferred the patent to another company. The Molnlycke
case did not prevent a motions judge from considering evidence of facts beyond the assign-
ment that resulted in an undue lessening of competition, which would engage s. 45 of the
Act. It was not plain and obvious that the defendant had no reasonable cause of action
against the company. The motions judge was obligated to carry out his own analysis of
whether s. 45 could apply and, if so, whether there was sufficient evidence to prove that the
plaintiff and/or the company engaged in conduct that was contrary to s. 45.
R. v. Bayda & Associates Surveys Inc. (1997), 207 A.R. 28, 55 Alta. L.R. (3d) 95, [1998] 4
W.W.R. 252, 78 C.P.R. (3d) 203 (Q.B.) — The accused land surveyors were charged with
conspiring or agreeing to unduly lessen competition contrary to s. 45(1)(c) as a result of a
meeting whereby they agreed to supply residential resale real estate reports for a minimum
price of $325. The charges were dismissed at the preliminary hearing, although there was
discussion of cost and price, where there was evidence from the participants that there was
no agreement as to price, and where one of the accused specifically stated at the meeting that
he would charge what he wanted.
120
R. v. Can. Packers Inc. (1988), 91 C.P.R. (3d) 133 (Alta. Q.B.) — An exchange of views
with respect to prices is not sufficient to constitute an offence under this section. The Crown
must establish that there was a meeting of minds, an agreement, although it need not prove
that the agreement worked.
Waterloo Law Assn. v. Canada (A.G.) (1986), 58 O.R. (2d) 275, 31 C.C.C. (3d) 564, 14
C.P.R. (3d) 413, 35 D.L.R. (4th) 751 (H.C.) — The Competition Act as a valid exercise of
Act
the federal criminal law power applies to all persons in Canada, including lawyers and law
associations. The latter are not removed from the reach of the criminal law by the fact that
the governance of the legal profession is within provincial jurisdiction. A lawyer or law
association may, however, be able to claim an exemption where the activities concerned are
required or authorized by provincial statute or by a governing body having delegated author-
ity under a provincial statute. However, where charges are based on an alleged county law
association fee schedule, this constitutional issue cannot be determined until it has been es-
tablished whether the accused have enforced or attempted to enforce minimum fee sched-
ules, whether the Law Society has put into effect a scheme requiring or authorizing lawyers
to adhere to uniform fee schedules, and whether county law associations have delegated
authority to enforce minimum fee schedules.
Atl. Sugar Refineries Co. v. A.G. Can., [1980] 2 S.C.R. 644, 12 B.L.R. 171, 53 C.P.R. (2d) 1,
54 C.C.C. (2d) 373, 16 C.R. (3d) 128, 32 N.R. 562, 115 D.L.R. (3d) 21 — A conspiracy may
be effected in any way and may be established by inference. However, an agreement by the
tacit acceptance of an offer requires explicit communication of the offer and a course of
conduct from which acceptance may be inferred. A conscious but independent adoption of a
uniform course of action without any communication, assent or promise amongst the ac-
cused is not such a tacit agreement.
R. v. Lethbridge Concrete Prod. Ltd. (1979), 52 C.P.R. (2d) 85, 24 A.R. 335 (T.D.). (See
also entry under s. 69.) — Simulated participation in an agreement to fix prices in order to
obtain information does not support a conviction for conspiracy.
R. v. Aluminum Co. (1976), 29 C.P.R. (2d) 183 (Que. S.C.) — The burden is on the Crown to
prove the accused’s guilt beyond a reasonable doubt. Circumstantial evidence must not only
be consistent with the guilt of the accused but inconsistent with any other rational conclusion
(applying Hodge’s Case (1838), 2 Lew. 227). The agreement in a conspiracy charge may be
proved by direct evidence or by a number of overt acts which raise the presumption of a
common design.
R. v. Can. Gen. Elec. Co. (1976), 15 O.R. (2d) 360, 29 C.P.R. (2d) 1, 34 C.C.C. (2d) 489, 75
D.L.R. (3d) 664 (Ont. H.C.). — Sentence — Factors to be considered in setting a fine for
conspiracy include: (1) deterrence (applying R. v. Armco Can. Ltd. (1975), 8 O.R. (2d) 573;
varied 13 O.R. (2d) 32); (2) the fine should exceed the profits generated by the violation,
although the economic evidence may be insufficient to apply this properly; (3) the protection
of the public interest in free competition; (4) the size and scale of the defendants’ operations;
(5) the defendants’ share of the market; (6) the length of time the conspiracy was active; (7)
the geographical area involved; (8) any previous convictions; (9) the penalties in other cases;
and (10) any mitigating circumstances. In assessing relative monetary penalties between de-
fendants factors to be considered include: (1) their position or influence in the conspiracy
and their initiative in promoting the agreement; (2) their overall financial position in relation
to the penalty to be enacted; and (3) their respective percentage of the total turnover of the
goods involved. In a conspiracy involving aggregate Canada-wide sales of millions of dol-
lars over 8 2/3 years by companies holding an aggregate of 95 per cent of the market, fines
imposed ranged from $100,000 for a company holding 23.4 per cent of the market to
$300,000 for a company holding 44 to 50 per cent of the market.
121
R. v. Armco Can. Ltd. (1976), 13 O.R. (2d) 32, 24 C.P.R. (2d) 145, 30 C.C.C. (2d) 183, 70
D.L.R. (3d) 287; leave to appeal to S.C.C. refused 13 O.R. (2d) 32n, 30 C.C.C. (2d) 183n
(S.C.C.) — “Conspire, combine, agree or arrange” all contemplate a mutual arriving at of an
understanding or agreement between the accused and some other person to do the acts for-
bidden. It is not necessary that each item of circumstantial evidence meet the test of Hodge’s
Case ((1838), 2 Lew. 227); it is sufficient if all facts put in evidence when considered to-
gether satisfy the rule (applying R. v. John, [1971] S.C.R. 781). Sentence — Factors to con-
sidered in setting a fine include: (1) the duration of the conspiracy; (2) the period for which
any particular accused was involved; (3) the accused’s market share; (4) the relative size of
the accused’s business; (5) the accused’s influence on the conspiracy; and (6) previous con-
victions. The fine imposed must be more than a mere licence fee. The accused members of
the Corrugated Steel Pipe Institute had maintained a uniform price for their product over a
period of about four years. Sales by the accused to the Department of Highways, the largest
customer for corrugated pipe, ranged from about $200,000 to about $1.4 M. Two of the
larger companies had previously pleaded guilty to similar charges, and were assessed fines
of $125,000 and $100,000. Fines for the other accused ranged from $2,000 (lowered on
appeal from $10,000) to $110,000. A prohibition order was also issued.
R. v. Anthes Business Forms Ltd. (1975), 10 O.R. (2d) 153, 20 C.P.R. (2d) 1, 26 C.C.C. (2d)
349; affirmed [1978] 1 S.C.R. 970, 28 C.P.R. (2d) 33n, 32 C.C.C. (2d) 207n, 22 N.R. 541.
(See also entry under s. 69.) — The onus is on the Crown to prove beyond a reasonable
doubt that the accused intended to enter into a conspiracy, combination, agreement or ar-
rangement, and that the conspiracy, combination, agreement or arrangement if (not when)
carried into effect would prevent or lessen competition unduly.
R. v. Can. Gen. Elec. Co. (1974), 16 C.P.R. (2d) 186, 17 C.C.C. (2d) 445 (Ont. H.C.) — A
fair trial does not require that the Crown give details in pleadings of all the minutiae of acts
and omissions over a number of years. Moreover, the terms of a conspiracy are seldom, if
ever, express and they must be gathered by implication from conduct.
R. v. Ocean Const. Supplies Ltd. (1974), 18 C.P.R. (2d) 166, 22 C.C.C. (2d) 340, 61 D.L.R.
(3d) 323 (B.C. C.A.) — Sentence — Sentencing is not an arithmetic problem. Income and
ability to pay of the accused and relative markets are relevant, but there are many other
factors. It was not relevant that the fines were larger than the accused could foresee and that
they were shocked, since it is disadvantageous that offenders be able to budget for the size of
the fine when deciding to commit an offence. It was also irrelevant that ownership of the
accused’s share had changed since the offence. Fines ranging from $25,000 to $125,000 on a
charge relating to the cement industry in British Columbia over periods of 1 2/3 to 10 years;
from $7,000 to $65,000 on a charge relating to the ready-mix cement business in the lower
mainland over periods of 1 1/4 to 11 years; and from $15,000 to $30,000 on a charge relating
to ready-mix in Victoria over 9 years were appropriate in the circumstances. Prohibition
orders were also appropriate.
R. v. Can. Cement Lafarge Ltd. (1973), 12 C.P.R. (2d) 12 (Ont. Prov. Ct.) — A pricing pol-
icy resulting from conscious parallelism is not, in the absence of collusion, an offence.
R. v. A.B.C. Ready-Mix Ltd. (1972), 17 C.P.R. (2d) 91 (Ont. H.C.) — Sentence — The 12
accused pleaded guilty to a conspiracy concerning the price of ready-mix concrete in To-
ronto. The accused had cooperated in providing information to the Crown and none had
previous convictions. Neither excessive profits nor undue price increases resulted from the
conspiracy. Fines varying from $7,500 to $35,000, with a total of $245,000, were imposed
and an order prohibiting continuation or repetition of the offending conduct granted.
122
R. v. Burrows (1966), 54 C.P.R. 95 (B.C.). — The accused, wholesale importers, distributors

and retailers of Japanese oranges, having reduced the number of importers to three of their
choosing, controlled the quantity and allocation of oranges imported, and fixed prices, pursu-
ant to a common agreement, were guilty of conspiring to limit competition unduly. It was no
defence that some of their practices were economically beneficial. The offence lay in the
prevention and limitation of competition pursuant to an agreement, and not in the economic
Act
effects of their practices. The accused were responsible for the unlawful acts of their em-
ployees acting within the scope of their employment, even though a superior had forbidden
the acts.
R. v. Civil Const. Inc. (1964), 47 C.P.R. 208 (Que.) — Sentence — The accused pleaded
guilty to a charge of conspiring with other named companies to decrease competition in
connection with tendering for a sewer contract for a municipality. The accused had taken
completed tender forms with different prices to the other companies which were not inter-
ested in tendering, and induced them to sign, then forwarded the tenders as from these com-
panies, together with its own tender at a lower price, to the municipality and obtained the
contract. The sentence, in order to be effective, should be prohibitive. The accused’s action
was reprehensible and completely distorted the objective of a call for tenders, which was to
secure a competitive price. The fact that the accused did not realize an unreasonable profit
was no justification. A fine of $1,000 was imposed and a prohibition order granted.
R. v. B.C. Pro. Pharmacists’ Soc., [1971] 1 W.W.R. 705, 64 C.P.R. 129, 3 C.C.C. (2d) 29,
17 D.L.R. (3d) 285 (B.C.) — The words “sale” and “supply” as used in this subsection are
appropriate to describe a transaction by which a pharmacist charges a $1 surcharge for sup-
plying a prescription to a welfare recipient which previously would have been supplied free.
Although the market in respect of welfare prescriptions is limited and controlled by the wel-
fare department and although a prescription is designed for only one person, a prescription is
nevertheless an “article” which is in the stream of commerce within the meaning of the Act.
Although prior to the imposition of the surcharge there was no general price competition,
there are other sources of competition, including those referred to in s. 32(3) [now s. 45(4)].
Competition in this case was provided by the seller’s option to sell or not sell to welfare
recipients at the price fixed. If the price was too low many could refuse to sell and thus force
the price up. Competition was also limited by the elimination of competition from non-phar-
macists. The ultimate objective of the scheme was to force the government to agree to pay a
higher price for prescription drugs supplied to welfare recipients, and the short-term objec-
tive was to prevent competition and restrain trade until the long-term objective had been
achieved. Those involved had therefore conspired to prevent or unduly lessen competition in
the sale or supply of prescription drugs. It was no defence to say that the surcharge was
necessary to prevent loss. It was irrelevant that each pharmacy exercised its own judgment as
to whether to impose the surcharge, that some may not have done so, that the accused society
had no power to force its imposition, and that the number of owners subscribing to the agree-
ment to impose the surcharge was not proven. The essence of the offence is an agreement to
prevent or unduly lessen competition, its success being irrelevant.
R. v. Dom. Steel & Coal Corp. (1956), 27 C.P.R. 57, 116 C.C.C. 117 (Ont. H.C.). (See as to
sentence [1956] O.W.N. 753.) — Sentence — There is no reason to distinguish in relation to
the amount of the fine between a wholly-owned subsidiary acting under the orders of its
parent company and the parent. The duration of the conspiracy, 20 years, and the complete
control of prices and conditions of sale through the agreement were considered in imposing
the maximum fine of $10,000 on each of the participants. A prohibition order is discretion-
ary. Although the impugned practices had been stopped even before an inquiry was started,
123
the duration of the conspiracy, its scope and the tightness of control justified issuance of a
prohibition order.
R. v. Howard Smith Paper Mills Ltd., [1954] O.R. 663, 22 C.P.R. 119, 19 C.R. 242, 109
C.C.C. 213, [1954] 4 D.L.R. 517 (S.C.) — Sentence — It is within the proper jurisdiction of
the court to comment on the propriety and effectiveness of the maximum penalty provided
and to express its opinion that it is wholly inadequate, and to impose the maximum penalty
without finding an excessively evil breach of the statute. In assessing the penalty factors,
such as the length of participation in the conspiracy, the activity with which an accused
pursued its intent and the size of an accused’s business are relevant, but not the economic
results of the conspiracy. Costs should be awarded against an accused only in special
circumstances.
45.1 Where application made under section 76, 79, 90.1 or 92 —

No proceedings may be commenced under subsection 45(1) against a person
on the basis of facts that are the same or substantially the same as the facts on
the basis of which an order against that person is sought by the Commissioner
under section 76, 79, 90.1 or 92.
R.S.C. 1985, c. 19 (2nd Supp.), s. 31; 2009, c. 2, s. 410
46. (1) Foreign directives — Any corporation, wherever incorporated, that

carries on business in Canada and that implements, in whole or in part in
Canada, a directive, instruction, intimation of policy or other communication
to the corporation or any person from a person in a country other than Can-
ada who is in a position to direct or influence the policies of the corporation,
which communication is for the purpose of giving effect to a conspiracy, com-
bination, agreement or arrangement entered into outside Canada that, if en-
tered into in Canada, would have been in contravention of section 45, is,
whether or not any director or officer of the corporation in Canada has knowl-
edge of the conspiracy, combination, agreement or arrangement, guilty of an
indictable offence and liable on conviction to a fine in the discretion of the
court.
(2) Limitation — No proceedings may be commenced under this section
against a particular company where an application has been made by the
Commissioner under section 83 for an order against that company or any
other person based on the same or substantially the same facts as would be
alleged in proceedings under this section.
R.S.C. 1985, c. 19 (2nd Supp.), s. 32; 1999, c. 2, s. 37(s)
Commentary
Section 46 makes it an offence for a corporation that carries on business in Canada to imple-
ment any foreign directive intended to give effect to an agreement or arrangement entered
into outside of Canada that, if entered into in Canada, would have been in contravention of
section 45.
This provision is targeted at international cartel activity affecting Canada. It is designed to
circumvent jurisdictional issues surrounding the application of the Act to offshore conspira-
124
cies where the conspirators are not located or incorporated in Canada but where the effects
of the conspiracy might be felt in Canada.
Section 46 does not require that the Canadian corporation have knowledge of the conspiracy
or even be affiliated with the person issuing the foreign directive. The section only applies to
corporations and not other sorts of entities such as partnerships.
Act
Case Law
R. v. Maxzone Auto Parts (Canada) Corp., 2012 FC 1117 (Fed. Court) — Maxzone Canada
carried out directives, instructions, and other communications from foreign affiliates that had
the authority to give directions to Maxzone Canada as to prices and sales of products in
Canada. The directives, instructions and other communications were for the purpose of giv-
ing effect to a price-fixing agreement in Canada. Maxzone Canada pleaded guilty to the
single count with which it was charged under s. 46. The jointly recommended sentence of a
fine of $1.5 million was arithmetically determined by reference to the volume of Maxzone
Canada’s total sales, or volume of commerce, in Canada during the relevant period of
$15,000,000. The court reluctantly agreed to the sentence primarily because of the signifi-
cant weight it gave to the expectations of the Crown and Maxzone Canada that the manner in
which the recommended sentence was determined in this case would be endorsed by the
court. However, the court had serious concerns as to its ability to become satisfied, on the
basis of the evidentiary record and cursory submissions, that a sentence calculated in the
arithmetical manner that was followed in this case would not be contrary to the public inter-
est and would not bring the administration of justice into disrepute. In the future, the court
may require a more detailed evidentiary record or a modified approach to the determination
of a jointly recommended sentence, as well as more detailed submissions. The court also
noted that price fixing and other hard core cartel agreements ought to be treated at least as
severely as fraud and theft, if not even more severely than those offences. In future cases it
will be advisable for the Crown and the offender to explain to the court why any jointly
recommended sentence that does not include a period of imprisonment in a penal institution
ought to be accepted by the court.
R. v. Mitsubishi Corp. (2005), 40 C.P.R. (4th) 333 (Ont. S.C.J.) — The accused, which was a
subsidiary of a U.S. company, owned 50 per cent of a graphite electrode manufacturer that
entered into an anti-competitive conspiracy with other manufacturers to restrict production
and fix prices of graphite electrodes in the world markets. The accused’s representative was
seconded to the manufacturer, facilitated procedural arrangements for meetings between the
manufacturers, and had knowledge of the discussions and the conspiracy agreement. The
accused implemented in Canada a directive on behalf of the U.S. company for the purpose of
giving effect to the conspiracy, contrary to s. 46 of the Act. On a plea of guilty to aiding and
abetting the implementation of the conspiracy, contrary to s. 21 of the Criminal Code, the
accused was fined the sum of $1 million on a joint submission. The aggravating circum-
stances were the economic benefits of the agreement, the volume of commerce involved, and
the fact that the defendant had a prior conviction. The mitigating circumstances were that the
accused was not a principal party to the agreement, and had no direct involvement in it.
R. v. UCAR Inc. (1999), (sub nom. Canada v. UCAR Inc.) 164 F.T.R. 85 (Fed. T.D.) — The
accused Canadian corporation carried out the directives of its international parent in order to
conduct a foreign price-fixing conspiracy. In Canada, the accused and its co-conspirator con-
trolled over 90% of the relevant market, and the sales of the accused during the five-year
period of the conspiracy were about $214 million. The accused voluntarily approached the
Competition Bureau to disclose the conspiracy and it had commenced the process of making
125
restitution. The accused pleaded guilty to an offence contrary to s. 46(1) of the Act and on a
joint submission to the court, a fine of $11 million was imposed.
47. (1) Definition of “bid-rigging” — In this section, “bid-rigging” means

(a) an agreement or arrangement between or among two or more persons
whereby one or more of those persons agrees or undertakes not to submit
a bid or tender in response to a call or request for bids or tenders, or
agrees or undertakes to withdraw a bid or tender submitted in response
to such a call or request, or
(b) the submission, in response to a call or request for bids or tenders, of
bids or tenders that are arrived at by agreement or arrangement between
or among two or more bidders or tenderers,
where the agreement or arrangement is not made known to the person calling
for or requesting the bids or tenders at or before the time when any bid or
tender is submitted or withdrawn, as the case may be, by any person who is a
party to the agreement or arrangement.
(2) Bid-rigging — Every person who is a party to bidrigging is guilty of an
indictable offence and liable on conviction to a fine in the discretion of the
court or to imprisonment for a term not exceeding 14 years, or to both.
(3) Exception — This section does not apply to
(a) an agreement or arrangement that is entered into or a submission that
is arrived at only by parties each of which is, in respect of every one of the
others, an affiliate; or
(b) an agreement or arrangement that is an “arrangement”, as defined in
section 53.7 of the Canada Transportation Act, or a submission that is ar-
rived at under that arrangement, that has been authorized by the Min-
ister of Transport under subsection 53.73(8) of that Act and for which the
authorization has not been revoked, if the agreement, arrangement or
submission is directly related to, and reasonably necessary for giving ef-
fect to, the objective of the arrangement.
R.S.C. 1985, c. 19 (2nd Supp.), s. 33; 2009, c. 2, s. 411; 2018, c. 8, s. 111; 2018, c. 10,
ss. 86, 97(2)
Commentary
Section 47 creates the offence of bid-rigging, which prohibits two or more persons, in re-
sponse to a call or request for bids or tenders, from either: (a) reaching an agreement
whereby one of them agrees (i) not to submit a bid or tender or (ii) to withdraw a bid or
tender already submitted or (b) submitting bids that are arrived at by agreement. Agreements
under paragraph (a) may be entered into by any “persons” whereas paragraph (b) is limited
to “bidders or tenderers”.
Bid-rigging is a per se offence. In other words, the prohibited behaviour alone is sufficient to
convict the accused and the Crown need not prove any anti-competitive effects.
In Defending a Cartel Case in Canada by Graham Reynolds and Janet Bolton, Antitrust,
Vol. 25, No. 2, Spring 2011, the authors note that “[d]efenses based upon principles of Cana-
126
dian law regarding a “call or request for bids or tenders” may be available in appropriate
cases [. . .and that. . .] mere requests for proposals (a common business practice) do not con-
stitute “calls or requests for bids or tenders” as required under section 47.”
In R. v. Durward (2014), the presiding judge noted in her instructions to the jury that the
words “bid” and “tender” are synonymous, requiring an invitation by the caller for offers
from contractors to enter into a subsequent contract on terms specified in the invitation to
Act
undertake the services for a price as specified by the contractor. Contractors’ offers must
comply with the terms of the call for tenders and must set out the terms on which the con-
tractor would provide the services sought. A call for bids or tenders involves the formation
of two contracts: Contract A and Contract B. Contract A is created when a caller issues a call
for bids or tenders (offer) and a bidder submits a bid in response (acceptance). Contract B is
formed when a winning bidder is ultimately selected. The parties must intend to be legally
bound. The title of the tendering document is not determinative of the parties’ intent.
The instructions to the jury distinguished between permissible and impermissible agreements
between bidders. An agreement to merely cooperate in the recruitment or pooling of re-
sources to fulfill the requirements of the bids is permissible. Prime-subcontractor agreements
(where subcontractors submit their own proposals to the same call) are also permissible. The
jury was asked to determine whether the similarities between the bids submitted by the ac-
cused parties to several government agencies occurred based on coincidences of market in-
telligence, or whether the similarities of were the result of an intention to arrive at the bid
submission by agreement.
According to the jury instructions, the “made known” defence could be satisfied by either
express or implied notification (which does not follow older case law relied on by the Crown
which required explicit notice to the caller of bids). Circumstantial evidence is sufficient to
determine whether the agreement has been made known.
As a result of the 2009/2010 amendments, ss. 45 and 47 are partially and imperfectly over-
lapping offences. Both provisions create per se offences targeting “hard core” cartel conduct
assumed to have such negative effects on the market (e.g., increasing prices or reducing
supply) as to render any other benefits, such as efficiency gains, irrelevant. Moreover, s. 45
clearly could apply to situations where two or more competitors agree to fix the price for the
supply of a product in response to a bid or tender, or where competitors “fix” prices by
agreeing to not submit or withdraw a bid. Presumably, s. 45 would capture situations of non-
action such as agreeing not to bid or withdraw a bid through broad concepts such as agreeing
to “allocate” markets or “control” prices, production or supply. Indeed, nothing in the Act
would prevent proceedings from being commenced under both ss. 45 and 47 in cases of
alleged bid rigging (s. 45.1 states that “[n]o proceedings may be commenced under section
45(1) against a person on the basis of facts that are the same or substantially the same as the
facts on the basis of which an order against that person is sought by the Commissioner under
section 76, 79, 90.1 or 92”, but not s. 47).
Section 47 expressly provides that there is no offence if the agreement has been made known
to the person calling for bids before the deadline for submission of bids. The penalty on
conviction includes an unlimited fine and/or prison sentences of up to 14 years. Prior to the
enactment of the bid-rigging offence in 1976, bid-rigging could be prosecuted as conspiracy
under s. 45 or fraud under the Criminal Code but convictions were difficult to obtain, even in
egregious cases. The per se section 47 offence was intended to alleviate these difficulties but
bid-rigging was and is still capable of breaching s. 45 (and the Criminal Code). Amendment
of the Act’s main conspiracy offence in 2010 re-opens as a practical matter the possibility
that s. 45 may be used in the context of bid-rigging where the conduct does not fit squarely
into the parameters of s. 47. On its face, s. 45 would apply to situations where two or more
127
competitors agreed to fix the price for the supply of a product in response to a bid or tender.
Section 45.1 would not prevent proceedings from being commenced under both s. 45 and s.
47 in cases of alleged bid-rigging. Similarly, the Competition Bureau has used s. 47 in cartel
cases where the conspiracy involved the submission of bids or tenders in response to re-
quests for quotations to supply. See, for example, Competition Bureau, New Release, “Re-
cord $30M Fine Obtained by Competition Bureau Against Japanese Auto Parts Supplier” 18
April 2013.
The Canada Transportation Act provides for the review and approval of airline joint venture
arrangements by the Minister of Transport. This process enables the Minister of Transport to
determine whether an agreement is in the public interest and, if so, to exempt the arrange-
ment from several provisions of the Act, including section 47. See also the commentary to
subsection 45(6).
Case Law
R. c. Fedele, 2018 QCCA 1901 — The trial judge sentenced the four respondents, an agent
and three officers of an excavating contracting company, to conditional sentences of 18 to 24
months of community service less a day for colluding through the agent with other general
contractors to win municipal contracts at higher margins. While the bid-rigging charges laid
against the respondents pursuant to section 47 of the Act were dropped as the presumptive
ceiling of 18 months set out in R. v. Jordan, 2016 SCC 27 was exceeded, criminal charges of
fraud, conspiracy to commit fraud, forgery, use of forged documents and conspiracy to make
and use forged documents resulted in their conviction. The trial judge found that the respon-
dents’ bid-rigging conspiracy was fraudulent and deprived the municipalities by forcing
them to award higher contracts than they otherwise would have, constituting “other fraudu-
lent means” within the meaning of section 380(1) of the Criminal Code. On appeal, the
applicant asked the court to reverse the Court of Quebec’s judgment and to substitute the
sentences it sought at trial with imprisonment terms ranging from 21 months less a day to 42
months. The court held that the gravity of the offences committed by the respondents was
greatly minimized by the trial judge, citing the fact that the value of the fraudulently ob-
tained contracts exceeded $15 million while the offences related to forgery and using forged
documents involved transactions totaling nearly $1 million. Because the sentences rendered
by the trial judge were clearly inconsistent with the principles of public condemnation and
denunciation, the court substituted the sentences with terms of imprisonment ranging from
18 to 36 months.
R. c. Rousseau, 2018 QCCS 640 — The offence of bid-rigging does not apply to all invita-
tions to submit bids, but to a bidding process that has the essential attributes of a more
formal call or request for bids or tenders. A formal process includes: (i) the existence of a
direct link between the tender and the bidders; (ii) the presence of a project defined and
sufficiently circumscribed; (iii) the commitment of the “tenderer” to treat bidders fairly; and
(iv) the expectation that the tender call triggers a contractual relationship between the com-
pliant bidders and the “tenderer”. Rousseau was eventually acquitted as the prosecution, in
the Court’s view, did not prove that the alleged bid-rigging (related to a request for bids for
ventilation work on large residential project) occurred in response to a “call or request for
bids or tenders” given that points (iii) and (iv) above were not met. The “tenderer” was
allowed to consider non-conforming bids and intended to invite one or more bidders to nego-
tiate the eventual contract without making the negotiation criteria known in advance and
without undertaking to select the lowest bidder.
R. v. Dowdall, 2013 ONCA 196 (Ont. C.A.) — Requests for proposals may be calls or re-
quests for bids or tenders even where they do not result in reciprocal and enforceable con-
128
tractual rights. The fact that a contract is not finalised does not mean that there has not been
a call or request for bids or tenders. The analysis of whether there was a “call or request for
tenders” should focus on the intention of the parties and whether they intended to enter into
contractual arrangements.
R. c. Industries Garanties ltée, 2014 QCCS 1582 (C.S. Que.); affirmed R. c. Al Nashar, 2015
CarswellQue 8671 (C.A. Que.) — The Superior Court quashed on certiorari a decision of the
Act
Provincial Court which held that there is no “call or request for bids or tenders” within the
meaning of s. 47 because it found, based on testimony and tendering documents, that the
parties did not intend to be bound contractually. The parties — building developers and po-
tential contractors — never stated that they did not intend to be bound. The Crown brought a
certiorari application in which it argued, successfully, that the court had exceeded its juris-
diction in that the judge had preferred an inference in favour of the defence instead of prefer-
ring an inference in favour of the Crown. The decision was upheld by the Court of Appeal.
R. c. Électromega ltée, 2010 CarswellQue 5468 (Que. S.C.) — The defendant and its com-
petitor had submitted identical bids on three items, two of which were the most important
and profitable bid items. The court held that the evidence did not establish, beyond a reason-
able doubt, that the defendant had entered into an agreement with its competitor. Given the
passage of time, the witness testimonies were imprecise, incomplete and even contradictory
as to certain key aspects. The defendant corporation was acquitted.
Canada v. R.L. Crain Inc. (1988), 22 C.P.R. (3d) 462 (N.S. T.D.) — Sentence — The ac-
cused pleaded guilty to bid-rigging. It was a first offence but the agreement to fix prices
existed for a number of years. A fine of $200,000 was imposed with the agreement of all
parties.
R. v. McLellan Supply Ltd. (1986), 69 A.R. 132, (sub nom. R. v. 215626 Alta. Ltd.) 12 C.P.R.
53 (Q.B.) — The accused Scott supplied and installed chain link fences. It obtained its fenc-
ing from the accused McLellan whom it also consulted re pricing and appropriate mark-up
before submitting tenders. McLellan often also tendered on the jobs on which it had been
consulted. The accused were charged with bid-rigging when they both tendered on one such
job, but they were acquitted. Although McLellan knew Scott was submitting a bid and could
estimate what that bid would be, and although Scott knew McLellan might submit a bid,
there was no agreement or arrangement between them to submit a bid of any particular na-
ture or even to bid at all. Their respective bids were not made known to one another.
R. v. York-Hanover Hotels Ltd. (1986), 9 C.P.R. (3d) 440 (Ont. Prov. Ct.) — The words
“bid” and “tender” are intended to describe part of a system which is designed and intended
to take advantage of the competitive factor in the market by inviting offers to provide a
service or product at a price to be stipulated by the individual making the offer and re-
warding those who submit the lowest or lower offers. If, after such offers are submitted, the
offerors are encouraged to submit revised proposals, then the bid process is destroyed. The
original offers made do not in such circumstances constitute bids or tenders.
R. v. Coastal Glass & Aluminum (1984), 8 C.P.R. (3d) 46, 17 C.C.C. (3d) 313 (B.C. S.C.);
affirmed (1986), 11 C.P.R. (3d) 391, 27 C.C.C. (3d) 289 (B.C. C.A.) — A quotation by a
sub-contractor for part of a building contract, submitted in accordance with the custom of the
construction industry after it becomes known a building is to be constructed but not in re-
sponse to a specific direction or call that the bid depository system be utilized, is not covered
by s. 32.2(1)(b) [now s. 47(1)(b)] as there has been no “call or request” as contemplated by
that section. Furthermore, a price quotation does not constitute a bid or tender within the
meaning of the section.
129
R. v. R.L. Thorpe Sales Ltd. (1983), 49 A.R. 354 (C.A.) — Sentence — Three heating equip-
ment suppliers were each convicted of six counts of bid-rigging in relation to an agreement
to share the market on a pre-arranged basis. For this purpose several bids were rigged on
contracts ranging from $1,500 to $20,000. At trial they were sentenced to $250 each on each
count. On appeal this was increased to $1,000 each on each count. A fine must not be a mere
licence fee, but rather must be sufficient to impress on the commercial public that the integ-
rity of the tender system must be upheld.
R. v. Lorne Wilson Tpt. Ltd.; R. v. Travelways Sch. Transit Ltd. (1982), 40 O.R. (2d) 86, 67
C.P.R. (2d) 188, 69 C.C.C. (2d) 94, 138 D.L.R. (3d) 690; affirming (sub nom. R. v.
Charterways Tpt. Ltd.) 32 O.R. (2d) 719, 60 C.C.C. (2d) 510, 123 D.L.R. (3d) 159 (C.A.) —
An agreement or arrangement to submit identical tenders is not, within the meaning of this
section, “made known” to a person requesting tenders because it was or may be inferred
from the fact that identical tenders were submitted. Express notification is required. Section
10 of the Public Vehicles Act, R.S.O. 1970, c. 392 [re-en. 1971, c. 50, s. 74], does not pre-
clude the operation of this section. The existence of a bid-rigging arrangement would prevent
the appropriate provincial authority from effectively exercising the power given to protect
the public interest under that Act. At trial and on an application to quash the committal for
trial ((1980), 52 C.P.R. (2d) 63, affirmed at 70 (Ont. C.A.)) it was held that mens rea and
proof of collusion need not be established before a conviction under this section could be
made. The only intention required to be proved is the intention to enter into the agreement.
The trial judge also stated that this section establishes a strict liability offence. On appeal
from the trial judgment it was held that the intention to do the very thing prohibited by this
section having been proved, it was unnecessary to determine if the offence created by this
section is one of strict liability.
48. (1) Conspiracy relating to professional sport — Every one who

conspires, combines, agrees or arranges with another person
(a) to limit unreasonably the opportunities for any other person to partici-
pate, as a player or competitor, in professional sport or to impose unrea-
sonable terms or conditions on those persons who so participate, or
(b) to limit unreasonably the opportunity for any other person to negoti-
ate with and, if agreement is reached, to play for the team or club of his
choice in a professional league
is guilty of an indictable offence and liable on conviction to a fine in the discre-
tion of the court or to imprisonment for a term not exceeding five years or to
both.
(2) Matters to be considered — In determining whether or not an agree-
ment or arrangement contravenes subsection (1), the court before which the
contravention is alleged shall have regard to
(a) whether the sport in relation to which the contravention is alleged is
organized on an international basis and, if so, whether any limitations,
terms or conditions alleged should, for that reason, be accepted in Can-
ada; and
(b) the desirability of maintaining a reasonable balance among the teams
or clubs participating in the same league.
130
Part VI — Offences (ss. 45-62) S. 49(1)(e)
(3) Application — This section applies, and section 45 does not apply, to
agreements and arrangements and to provisions of agreements and arrange-
ments between or among teams and clubs engaged in professional sport as
members of the same league and between or among directors, officers or em-
ployees of those teams and clubs where the agreements, arrangements and
Act
provisions relate exclusively to matters described in subsection (1) or to the
granting and operation of franchises in the league, and section 45 applies and
this section does not apply to all other agreements, arrangements and provi-
sions thereof between or among those teams, clubs and persons.
Commentary
There has been little judicial consideration of section 48 and it is not clear how it would be
interpreted by the courts.
Limitations placed on players in the context of a collective agreement would be exempt from
section 48, by virtue of section 4, which exempts collective bargaining activities from the
scope of the Act.
See also section 6, which provides that the Act does not apply with respect to agreements
and arrangements in amateur sport.
Case Law
Yashin v. National Hockey League (2000), 192 D.L.R. (4th) 747 (Ont. S.C.J.) — The appli-
cant, a professional hockey player, filed an application for judicial review of an arbitrator’s
decision requiring him to fulfill his contract in order to gain a particular status under the
National Hockey League’s collective bargaining agreement. The application was dismissed.
The judge held that the arbitrator’s decision did not violate s. 48(1). Section 4(1) specifically
exempts collective bargaining activities and, furthermore, the judge noted that collective bar-
gaining agreements entered into by trade unions do not constitute an illegal restraint of trade.
Reed v. Ottawa Football Club (1988), 62 Alta. L.R. (2d) 347 (Alta. Q.B.) — A professional
football player and the league’s players’ association applied for an interim injunction to re-
strain the league from enforcing certain amendments to the collective agreement that would
effectively bar a player from playing in the league contrary to s. 32.3 [now s. 48]. The appli-
cants argued that the amendments in question were implemented without any input from the
players’ association and breached the parties’ collective agreement. The court determined
that there was a serious issue to be tried and granted an interim injunction ordering that the
defendant be restrained from enforcing the modified provisions of the collective agreement.
49. (1) Agreements or arrangements of federal financial institu-

tions — Subject to subsection (2), every federal financial institution that
makes an agreement or arrangement with another federal financial institution
with respect to
(a) the rate of interest on a deposit,
(b) the rate of interest or the charges on a loan,
(c) the amount or kind of any charge for a service provided to a customer,
(d) the amount or kind of a loan to a customer,
(e) the kind of service to be provided to a customer, or
131
S. 49(1)(f) Competition Act
(f) the person or classes of persons to whom a loan or other service will be
made or provided or from whom a loan or other service will be withheld,
and every director, officer or employee of the federal financial institution who
knowingly makes such an agreement or arrangement on behalf of the federal
financial institution is guilty of an indictable offence and liable to a fine not
exceeding ten million dollars or to imprisonment for a term not exceeding five
years or to both.
(2) Exceptions — Subsection (1) does not apply in respect of an agreement
or arrangement
(a) with respect to a deposit or loan made or payable outside Canada;
(b) applicable only in respect of the dealings of or the services rendered
between federal financial institutions or by two or more federal financial
institutions as regards a customer of each of those federal financial insti-
tutions where the customer has knowledge of the agreement or by a fed-
eral financial institution as regards a customer thereof, on behalf of that
customer’s customers;
(c) with respect to a bid for or purchase, sale or underwriting of securities
by federal financial institutions or a group including federal financial
institutions;
(d) with respect to the exchange of statistics and credit information, the
development and utilization of systems, forms, methods, procedures and
standards, the utilization of common facilities and joint research and de-
velopment in connection therewith, and the restriction of advertising;
(e) with respect to reasonable terms and conditions of participation in
guaranteed or insured loan programs authorized pursuant to an Act of
Parliament or of the legislature of a province;
(f) with respect to the amount of any charge for a service or with respect
to the kind of service provided to a customer outside Canada, payable or
performed outside Canada, or payable or performed in Canada on behalf
of a person who is outside Canada;
(g) with respect to the persons or classes of persons to whom a loan or
other service will be made or provided outside Canada;
(h) in respect of which the Minister of Finance has certified to the Com-
missioner that Minister’s request for or approval of the agreement or ar-
rangement for the purposes of financial policy and has certified the names
of the parties to the agreement or arrangement; or
(i) that is entered into only by financial institutions each of which is an
affiliate of each of the others.
(3) Definition of “federal financial institution” — In this section and
section 45, “federal financial institution” means a bank or an authorized for-
eign bank within the meaning of section 2 of the Bank Act, a company to which
132
Part VI — Offences (ss. 45-62) S. 52(1.1)(b)
the Trust and Loan Companies Act applies or a company or society to which
the Insurance Companies Act applies.
(4) Where proceedings commenced under section 76, 79, 90.1 or
92 — No proceedings may be commenced under this section against a person
on the basis of facts that are the same or substantially the same as the facts on
Act
the basis of which an order against that person is sought by the Commissioner
under section 76, 79, 90.1 or 92.
R.S.C. 1985, c. 19 (2nd Supp.), s. 34; 1991, c. 45, s. 548; 1991, c. 46, ss. 591, 593;
1991, c. 47, s. 715; 1993, c. 34, s. 51; 1999, c. 2, s. 37(t); 1999, c. 28, s. 153; 2009, c. 2,
s. 412
Commentary
This section was formerly found in s. 309 of the Bank Act, S.C. 1980–81–82–83, c. 40. It
was transferred from the Bank Act to the Competition Act with some modifications. The
changes include the addition of the word “arrangement” and the raising of the maximum
penalty from two years’ imprisonment to five years. A maximum fine of $10 million is also
established.
To date, there have been no reported decisions under subsection 49(1). Although section 49
does not appear to be an enforcement priority for the Competition Bureau, its per se nature
makes it applicable at least in theory to a wide range of commercial arrangements between
federal financial institutions. For example, an otherwise legal non-compete clause in a
purchase agreement between federal financial institutions could, as a technical matter, con-
travene subsection 49(1) and not be saved by an exemption in subsection 49(2).
The exempting provision in paragraph (2)(h) is somewhat narrower than the earlier provision
in the Bank Act. That provision exempted agreements “requested or approved by the Min-
ister” whereas the new exemption requires the Minister to make a certification to the Com-
missioner of Competition that such approval or request was for the “purposes of financial
policy”. To date, there have been no certificates issued under paragraph 49(2)(h).
50. [Repealed 2009, c. 2, s. 413.]
51. [Repealed 2009, c. 2, s. 413.]
52. (1) False or misleading representations — No person shall, for the

purpose of promoting, directly or indirectly, the supply or use of a product or
for the purpose of promoting, directly or indirectly, any business interest, by
any means whatever, knowingly or recklessly make a representation to the
public that is false or misleading in a material respect.
(1.1) Proof of certain matters not required — For greater certainty, in
establishing that subsection (1) was contravened, it is not necessary to prove
that
(a) any person was deceived or misled;
(b) any member of the public to whom the representation was made was
within Canada; or
133
S. 52(1.1)(c) Competition Act
(c) the representation was made in a place to which the public had access.
(1.2) Permitted representations — For greater certainty, in this section
and in sections 52.01, 52.1, 74.01, 74.011 and 74.02, the making or sending of a
representation includes permitting a representation to be made or sent.
(2) Representations accompanying products — For the purposes of
this section, a representation that is
(a) expressed on an article offered or displayed for sale or its wrapper or
container,
(b) expressed on anything attached to, inserted in or accompanying an
article offered or displayed for sale, its wrapper or container, or anything
on which the article is mounted for display or sale,
(c) expressed on an in-store or other point-of-purchase display,
(d) made in the course of in-store or door-to-door selling to a person as
ultimate user, or by communicating orally by any means of telecommuni-
cation to a person as ultimate user, or
(e) contained in or on anything that is sold, sent, delivered, transmitted or
made available in any other manner to a member of the public,
is deemed to be made to the public by and only by the person who causes the
representation to be so expressed, made or contained, subject to subsection
(2.1).
(2.1) Representations from outside Canada — Where a person re-
ferred to in subsection (2) is outside Canada, a representation described in
paragraph (2)(a), (b), (c) or (e) is, for the purposes of subsection (1), deemed to
be made to the public by the person who imports into Canada the article, thing
or display referred to in that paragraph.
(3) Deemed representation to public — Subject to subsection (2), a per-
son who, for the purpose of promoting, directly or indirectly, the supply or use
of a product or any business interest, supplies to a wholesaler, retailer or other
distributor of a product any material or thing that contains a representation of
a nature referred to in subsection (1) is deemed to have made that representa-
tion to the public.
(4) General impression to be considered — In a prosecution for a con-
travention of this section, the general impression conveyed by a representation
as well as its literal meaning shall be taken into account in determining
whether or not the representation is false or misleading in a material respect.
(5) Offence and punishment — Any person who contravenes subsection
(1) is guilty of an offence and liable
(a) on conviction on indictment, to a fine in the discretion of the court or
to imprisonment for a term not exceeding 14 years, or to both; or
134
(b) on summary conviction, to a fine not exceeding $200,000 or to impris-

onment for a term not exceeding one year, or to both.
(6) Reviewable conduct — Nothing in Part VII.1 shall be read as exclud-
ing the application of this section to a representation that constitutes review-
able conduct within the meaning of that Part.
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(7) Duplication of proceedings — No proceedings may be commenced
under this section against a person against whom an order is sought under
Part VII.1 on the basis of the same or substantially the same facts as would be
alleged in proceedings under this section.
1999, c. 2, s. 12; 2009, c. 2, s. 414; 2010, c. 23, s. 74; 2014, c. 31, s. 33
Commentary
Misleading advertising is both a criminal offence and a civil reviewable practice under the
Competition Act (see section 74.01). These two tracks are mutually exclusive pursuant to
sections 52(7) and 74.16 of the Act. Once charges have been laid or an application has been
filed with the Competition Tribunal, the Commissioner of Competition may not switch re-
gimes. In most instances, the civil track will be pursued unless the Commissioner is satisfied
that the circumstances of the case warrant criminal prosecution. In making this determina-
tion, the Commissioner will consider the criteria outlined in Information Bulletin on Mis-
leading Representations and Deceptive Marketing Practices: Choice of Criminal or Civil
Track under the Competition Act (Ottawa: Competition Bureau, September 1999).
Subsection 52(1) establishes the criminal offence of knowingly or recklessly making a repre-
sentation to the public that is false or misleading in a material respect in order to promote a
product, service or business interest. Pursuant to subsection 52(1.1), there is no requirement
to prove that anyone was actually deceived or misled. Whether a representation is “mislead-
ing in a material respect” depends on whether or not it will influence a customer’s buying
decision. The permitting of a representation to be made under section 52 of the Act is also
prohibited.
In proceedings under section 52, it is not necessary to prove that (a) any person was actually
deceived or misled, (b) any member of the public to whom the representation was made was
within Canada, or (c) the representation was made in a place to which the public had access.
The specific mens rea requirement that the Crown must prove is that a person “knowingly”
or “recklessly” made a false or misleading representation to the public. The general impres-
sion conveyed by a representation, as well as its literal meaning, is also taken into account in
determining whether or not a representation is false or misleading in a material respect. The
main principles applicable to a determination under section 52 were summarized in Maritime
Travel Inc. v. Go Travel Direct.Com Inc. (2008), 66 C.P.R. (4th) 61, 265 N.S.R. (2d) 369
(N.S.S.C.); additional reasons at (2008), 269 N.S.R. (2d) 396 (N.S.S.C.); additional reasons
at 2008 CarswellNS 602 (N.S.S.C.); affirmed 2009 CarswellNS 219 (N.S.C.A.). Maritime
Travel is also the first case in which a court has awarded damages under section 36 for
breach of section 52.
The 2009 amendments to the Competition Act increased the maximum prison term that can
be imposed under section 52 from five years to 14 years. The maximum fine has not been
changed and remains in the discretion of the court.
135
Case Law
Energizer Brands, LLC v. The Gillette Company, 2020 FCA 49 (Fed. C.A.) — Plaintiffs ap-
pealed a decision from the Federal Court dismissing a claim to an accounting of profits
under subsection 52(1) of the Competition Act. The Court upheld the motion judge’s sum-
mary dismissal, deciding that subsection 36(1) of the Competition Act limits remedies to the
recovery of a plaintiff’s actual loss or damage. The Court also held that, because the determi-
nation of remedies under subsection 36(1) is a matter of law, such a question may be prop-
erly determined on a motion for summary judgement.
Durand c. Subway Franchise Systems of Canada, 2019 QCCS 477 (C.S. Que.) — Durant
sought to certify a class proceeding after a CBC report claimed that the chicken pieces in
Subway sandwiches contained 50% chicken DNA. The Court refused to certify the class,
holding that there was no evidence that Subway represented its chicken sandwiches as con-
taining 100% chicken to the public. Therefore, there was no cause of action under section
52(1).
British Columbia Recreation and Parks Assn. v. Zakharia, 2015 BCSC 1650 (B.C. S.C.) —
The defendant made false or misleading representations to the public by using a false British
Columbia Recreation and Parks Association certificate in order to obtain a CanFitPro desig-
nation. The designation allowed him to promote himself as a personal trainer in furtherance
of his business interests.
Demone Monuments and Granite Products Ltd. v. Heritage Memorials Ltd., 2015 NSSC 314
(N.S. S.C.) — The parties both sell cemetery headstones or monuments. Demone alleged
that Heritage and its employees made false and misleading statements with respect to the
products and services offered by Demone (i.e., that the plaintiff uses inferior or substandard
material in its production of granite monuments and that the plaintiff cannot manufacture its
own monuments). The Court granted an injunction to prohibit Heritage from making certain
statements until the issues are resolved at trial.
The Court held that Heritage should not be restricted from expressing its opinion that
Demone uses products that are “substandard.” Heritage should remain free to express un-
favourable opinions about the quality of its competitor’s products, the quality of its work or
its capability to perform work. Heritage was enjoined only from making specific assertions
of fact that, based on the evidence before the court on the motion, are not factually correct.
For example, it cannot represent that Demone uses granite from China for its monuments
(because the granite is from India). Heritage is not restrained from offering its opinions as to
the quality of granite sourced from India and is not enjoined from saying that it believes that
granite from its own quarries is superior to that sourced from India. Heritage cannot, how-
ever, say that Demone either does not or does not have the capacity to cut, shape, polish and
finish, monuments or headstones.
Sandoff v. Loblaw Companies Ltd., 2015 SKQB 345 (Sask. Q.B.) — The plaintiffs alleged
misleading and deceptive advertising of low sodium beverages by the defendants. Specifi-
cally, the plaintiffs alleged that while the beverages had minimal sodium content, the sodium
content was not low relative to comparative alternative products that did not include a low
sodium label. The Court concluded that the plaintiffs’ claim under the Competition Act can-
not succeed because: (i) the “low sodium” label when attached to PC Low Sodium Bever-
ages is neither a false representation nor a misleading representation; and (ii) the evidence
established that Loblaws carefully informs itself of, and follows, the relevant regulations;
there is no evidence that the defendants acted “knowingly or recklessly” in labelling the PC
Low Sodium Beverages as “low sodium.”
136
Sandhu v. HSBC Finance Mortgages Inc., 2014 BCSC 2041 (B.C. S.C.); reversed 2016 Car-
swellBC 1899 (B.C. C.A.) — Plaintiffs sought an order for class certification, claiming dam-
ages arising from the defendant’s alleged failure to disclose the cost of borrowing and the
secret charging of legal fees. A failure to divulge information could amount to
misrepresentation.
Arora v. Whirlpool Canada LP, 2012 ONSC 4642 (Ont. S.C.J.) — Whirlpool’s failure to
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disclose an alleged design defect did not constitute misrepresentation contrary to s. 52.
Whirlpool was under no obligation to disclose the defect. Remaining silent did not constitute
a misrepresentation.
Maritime Travel Inc. v. Go Travel Direct.Com Inc. (2008), 66 C.P.R. (4th) 61, 265 N.S.R.
(2d) 369 (N.S.S.C.); additional reasons at (2008), 269 N.S.R. (2d) 396 (N.S.S.C.); additional
reasons at 2008 CarswellNS 602 (N.S.S.C.); affirmed 2009 CarswellNS 219 (N.S.C.A.) —
The plaintiff was a travel agency that brought an action against the defendant, a direct sale
tour operator that had recently entered the Halifax market, in respect of certain of the defen-
dant’s advertisements that ran between 2003 and 2005. All of the advertisements at issue
compared the defendant’s price for a specific vacation destination to the plaintiff’s price for
the same destination. The plaintiff alleged that the advertisements contravened s. 52 of the
Act and sought damages under s. 36. The court held that only the defendant’s 2004 adver-
tisement had breached the section and awarded damages of $216,842 to the plaintiff. To
arrive at this conclusion, the trial judge summarized the main principles applicable to a de-
termination under s. 52: (1) the general impression of the advertisement must be determined,
which requires a consideration of the advertisement’s target audience; (2) the literal meaning
of the advertisement must be considered; (3) extraneous evidence may be considered in de-
termining if the advertisement is false or misleading in a material respect, but not for the
purpose of altering the general impression created by the advertisement; (4) whether an ad-
vertisement is misleading in a material respect depends on the effect it would have on a
consumer’s buying decision; (5) aggressive advertising is allowed, unless it is an “untruthful
disparagement” of the goods or services of a competitor, (6) the court should not interfere
with advertising unless it is clearly unfair; (7) even advertisements that “push the bounds of
what is fair” are not misleading in a material way; and (8) in the civil context of awarding
damages under s. 36, the burden of proof on the plaintiff is proof on a balance of probabili-
ties but it is a heavier burden because of the seriousness of the alleged conduct. In this case,
the court found that the general impression and literal meaning of the 2004 advertisement
were the same (specifically, that the defendant offered vacation packages at lower prices
than the plaintiff without a travel agent earning commissions) and that the advertisement was
misleading because it might leave consumers with the impression that the plaintiff’s pack-
ages were more expensive than the defendant’s packages because commissions increased the
plaintiff’s price (the advertisements omitted to state that the plaintiff often price matched).
On materiality, the example in the advertisement of the savings per person was determined
to be one that would affect a consumer’s buying decision. The court also found that the
defendant had knowingly made the false and misleading representation because it had
dropped its price for the sole purpose of running the 2004 advertisement. — See also entry
under s. 36.
Telus Communications Co. v. Bell Mobility Inc., 2007 BCSC 518 (B.C.S.C. [In Cham-
bers]) — The plaintiff brought an application for an interim injunction to restrain the defen-
dant from continuing to advertise to prospective cell phone customers with the statement “on
the most powerful network in Western Canada”. The plaintiff alleged the defendant’s adver-
tisements violated s. 52. The application was denied. The statement was literally true. The
network was the most powerful network even though it was owned by and built at the plain-
137
tiff’s expense and the defendant was entitled to use the network by virtue of a legal arrange-
ment with the plaintiff.
Tele-Mobile Co., a Partnership v. Bell Mobility Inc. (2006), 46 C.P.R. (4th) 146 (B.C. S.C.
[In Chambers]); additional reasons at 2006 CarswellBC 2462 (B.C.S.C. [In Chambers]); ad-
ditional reasons at 2006 CarswellBC 2482 (B.C.S.C. [In Chambers]) — The plaintiff and the
defendant developed a shared high speed broadband wireless voice and data network based
on evolution, data optimized (EV-DO) technology. The network allowed the plaintiff and the
defendant to offer wireless services at a higher data transfer rate than their principal competi-
tor. The defendant began offering EV-DO service in some parts of Canada in October 2005.
The defendant developed advertisements announcing that it was the only provider of services
based on the EV-DO standard, and that the defendant’s services were more than five times
faster than its competition in Canada. The defendant’s advertising campaign began in No-
vember 2005, one week after the plaintiff launched its EV-DO service. The plaintiff notified
the defendant that its advertising claims were erroneous, and the defendant took steps to
correct or remove the advertisements. The plaintiff applied for an interim injunction prohib-
iting the defendant from publishing or distributing the advertising materials. A senior officer
of the defendant committed by affidavit to cease the advertising at issue. The application for
the interim injunction was dismissed. Where the defendant has stated his intention not to
engage in the conduct that aggrieves the plaintiff, any claim for irreparable harm was specu-
lative and could not justify the extraordinary remedy of an injunction.
CC&L Dedicated Enterprise Fund (Trustee of) v. Fisherman (2001), (sub nom. Mondor v.
Fisherman) 15 C.P.R. (4th) 289 (Ont. S.C.J.) — In a class action, the plaintiffs claimed that
the defendant auditors misrepresented that a company was a legitimate business with income
only from legitimate business activities. The plaintiffs alleged negligence, negligent misrep-
resentation at common law and reckless misrepresentation under s. 52. The defendants
brought a motion to strike out the statement of claim on the basis that it disclosed no reason-
able cause of action against them. The motion was dismissed. The plaintiffs had pleaded
sufficient material facts to support a relationship of proximity between the parties thereby
giving rise to a prima facie duty of care. It was arguable that the defendants ought to have
reasonably foreseen that the plaintiffs would rely upon their representations in deciding
whether to invest in the company. Whether a plaintiff has actually relied upon a misrepresen-
tation is a question of fact and may be inferred from the circumstances. Professionals argua-
bly have a secondary intention to promote their own professional services when they place
their name on a document. Accordingly, it could be argued that the defendants’ alleged mis-
representations were for the purpose of promoting their “business interests” within the mean-
ing of s. 52, even though it constituted only an indirect intention of the representation.
Apotex Inc. v. Hoffman-LaRoche Ltd. (2000), 9 C.P.R. (4th) 417, 195 D.L.R. (4th) 244, 139
O.A.C. 63 (Ont. C.A.) — The plaintiff was a manufacturer of generic drug products. The
brand name defendants were owners of patents on drug products and incorporated a com-
pany to sell their name brand drug products as generic products. The name brand defendants
had manufactured certain “pseudo-generic drug products” which were identified in composi-
tion to the name brand drug product and produced them on the same production line. These
“pseudo-generic drug products” were, however, labelled as originating from the company,
and sold at much lower prices. The plaintiff commenced an action alleging that the defend-
ants’ marketing strategy violated s. 52. On a motion by the defendants, the trial judge struck
out the plaintiff’s statement of claim. On appeal, the plaintiff’s appeal was allowed. The core
of the plaintiff’s claim was the positive representation that the drugs originated with the
company, when they in fact originated from the defendants. This representation amounted to
a violation of s. 52(1) as, on the facts pleaded, this was false. There were sufficient facts
138
pleaded to support a finding that the representation was made knowingly. A representation
was material for the purposes of s. 52(1) if it is so pertinent, germane or essential that it
could affect the decision to purchase. Although the causal connection between the false rep-
resentation and loss or damage to the plaintiff was weak, it was not plain or obvious that the
plaintiff’s claim would fail given the broad wording of s. 52.
R. v. Woolworth Canada Inc. (2000), 3 B.L.R. (3d) 174 (Ont. C.J.) — The accused were
Act
alleged to have engaged in false advertising in respect of the availability of a particular toy
product in reasonable quantities contrary to s. 52. The toy product was advertised at a bar-
gain basement price without sufficient quantities being available. The accused adduced evi-
dence that, based on prior disappointing sales, fewer numbers of the product were ordered at
the time of the advertising campaign. The magnitude of the consumer response resulted in
the accused having insufficient volume of the product available. The court concluded that the
accused breached s. 52 due to the representation that they would provide the product during
the sale period but were unable to do so through error in their estimation of the consumer
demand. However, the court further concluded that the defence of due diligence was made
out at common law and at former s. 60(2). In acquitting the accused, the court found that the
accused exercised due diligence both prior to and after the first day of the sale. They had a
rational ordering system in place and a reasonable approach to the buying process. They
responded to the unforeseen consumer demand by a prompt reordering of replacement prod-
uct, they undertook to supply the product to all customers who requested it by providing
“rainchecks” at the bargain price, and they fulfilled that undertaking.
Boehringer Ingelheim (Canada) Inc. v. Bristol-Myers Squibb Canada Inc. (1998), 83 C.P.R.
(3d) 51 (Ont. Gen. Div.) — The defendant was the only supplier of a certain cancer medica-
tion and the plaintiff introduced a competing generic drug at a much lower price. The defen-
dant subsequently lowered its price to match that of the plaintiff resulting in the plaintiff
achieving a much smaller market penetration than would normally be expected. The defen-
dant also alleged that the defendant made false or misleading statements contrary to s. 52.
The plaintiff sought both damages and injunctive relief. The plaintiff also sought an interloc-
utory mandatory injunction ordering the defendant to send a retraction letter with respect to
certain statements. The plaintiff’s motion for injunctive relief was dismissed. The plaintiff’s
claim in respect of false and misleading statements was based on several causes of action
including s. 52 and harm was an essential element. There was a lack of clear evidence of
harm. The statements were made close to a year previous and if there was harm, objective
evidence should have surfaced. A previous order of the court had preserved the status quo
until trial.
Carom v. Bre-X Minerals Ltd. (1998), 82 C.P.R. (3d) 187, 20 C.P.C. (4th) 187 (Ont. Gen.
Div.) — The plaintiffs in their class action claimed damages from the defendants for losses
suffered due to the purchase of shares of the mining company. The causes of action asserted
by the plaintiffs included a claim based on a breach of the misleading advertising provision
of the Competition Act, and alleged representations relating to the secondary sale of the
shares. The defendants brought a motion seeking to strike out the cause of action relating to
the Competition Act as the application of the Act to the facts in this case constituted an
unconstitutional incursion into provincial jurisdiction. The motion was dismissed. The con-
stitutionality of predecessors to the Act and s. 36 were upheld by the Supreme Court of
Canada. Although the scope of s. 52 may be so broad as to encompass behaviour that is not
anti-competitive, it was arguable that the facts as pleaded could be anti-competitive in their
effect. Accordingly, it was best to leave this issue to the trial judge.
R. v. Medi-Man Rehabilitation Products, Inc. (1998), 81 C.P.R. (3d) 267 (Ont. Gen. Div.) —
The company imported hydraulic and electric patient lifts which were assembled in Canada.
139
The company exchanged the boxing of the products, removed the manufacturer’s labels, and
reprinted the instruction booklets, which effectively removed the identification of the foreign
manufacturer, and gave the impression that the products were manufactured in Canada. The
company pleaded guilty to three counts of fraudulent business practices. An aggravating fac-
tor was that the fraudulent practices were carried out over a lengthy period of time. On the
other hand, there were mitigating factors such as the guilty plea, the company’s co-operation
in the investigation and the lack of a past record. The company was fined $60,000 on each
count, and the two principals of the company were each fined a total of $10,000.
Purolator Courier Ltd. v. United Parcel Service Canada Ltd. (1995), 20 B.L.R. (2d) 270, 60
C.P.R. (3d) 473 (Ont. Gen. Div.); additional reasons at (November 8, 1995), Doc 95-CU-
81492 (Ont. Gen. Div.) — Whether an advertisement is misleading is a question of general
impression and not literal meaning. The general impression depends on a number of factors
including the use of qualifiers such as “usually” and “up to”. Thus, where the defendant
advertised rates “... usually at rates up to 40% less than other couriers charge ...”, given the
facts that the consumers were business individuals and that the use of the qualifier “... up to
...” was common, the natural import of the advertisement was that savings up to 40 per cent,
depending on weight, size, etc., may be available, pending further inquiry. The action was
therefore dismissed. However, not all qualifiers negate a misleading impression. The effect
of a qualifier is dependent on the facts of each case. The fact that the plaintiff was not specif-
ically identified in the advertisement would not itself defeat a civil action under s. 36. An
advertisement may sometimes be understood as referring to all members of a given class.
Thus the plaintiff was free to assert its claim, since it was referred to by implication.
R. v. Independent Order of Foresters, [1989] I.L.R. 1-2420, 26 C.P.R. (3d) 229, 32 O.A.C.
278 (C.A.); affirming (1987), 26 C.P.R. (3d) 56 (Ont. Dist. Ct.) — This section is directed at
advertising in relation to goods and services and was not intended to cover advertisements
inviting applications for employment as commission salespeople. Furthermore, the accused
was registered as a seller of life insurance and accordingly was entitled to invoke the regu-
lated industries defence in relation to such advertising. In addition, the impugned advertising
either was not untrue or was not false or misleading in a material respect.
R. v. Independent Order of Foresters (No. 1) (1986), 13 C.P.R. (3d) 563 (Ont. Dist. Ct.) —
The regulated industry defence does not shield an industry from prosecution but rather is to
be raised as a defence. In each case the particular activities or allegations must be measured
against the provincial regulation to see if they are addressed by these regulations.
R. v. Postal Promotions Ltd. (1986), 11 C.P.R. (3d) 215 (Ont. Dis. Ct.); leave to appeal to
Ont. C.A. refused (1987), 16 C.P.R. (3d) 383 (Ont. C.A.) — The accused was a Canadian
mailing house which copied and sent out letters on behalf of an American exporter, using
mailing labels supplied by the exporter. The accused had no input into the content of the
letter nor any authority to alter the letter. It also received and forwarded orders to the ex-
porter, who in turn sent pre-packaged books to the accused who labelled and mailed them.
The accused received payment for the books from which it paid refunds and deducted its
fees before forwarding the balance to the exporter. In these circumstances the accused was
not an importer within the meaning of s. 52(2) [now s. 52(2.1)] and could not be responsible
as a principal for the contents of the letters or books or be said to have caused the impugned
representations to have been made.
R. v. Clarke (1983), 71 C.P.R. (2d) 38, 5 C.C.C. (3d) 58, 43 Nfld. & P.E.I.R. 127, 127
A.P.R. 127, 147 D.L.R. (3d) 763 (Nfld. C.A.) — There is no essential conflict between this
section, which creates an offence relating to specific misleading representations to the pub-
lic, and ss. 5, 7 and 20 of the Newfoundland Trade Practices Act, S.N. 1978, c. 10, which
provide remedies to individual consumers who are victims of unfair trade practices and un-
140
conscionable acts or practices, and penalties for contravention of the Act. The latter Act is
regulatory and not penal in nature.
R. v. Nova Motors Ltd. (1982), 51 N.S.R. (2d) 273, 102 A.P.R. 273 (Co. Ct.) — Knowledge
of the misleading nature of an advertisement is an element of the offence under this subsec-
tion which must be proven, although the Crown has the assistance of the presumption in s.
45(2)(a) [now s. 69(2)(a)]. Pursuant to s. 45(1)(a) [now s. 69(1)(a)] a corporate accused is
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not responsible for statements made by an employee in excess of his authority and contrary
to instructions.
R. v. Yukon Auto. Brokers Ltd. (1979), 50 C.P.R. (2d) 81 (Y.T. S.C.) — An accused corpora-
tion which raises a reasonable doubt that a misrepresentation by a salesman was authorized
within the meaning of s. 45(2)(a) [now s. 69(2)(a)] is entitled to acquittal on a charge under
this section.
Subsection (1)
R. v. Benlolo, 2004 CarswellOnt 8781 (Ont. S.C.J.); varied (2006), 49 C.P.R. (4th) 161, 81
O.R. (3d) 440 (Ont. C.A.) — The primary defendants, two brothers, operated a mail fraud
scheme with the assistance of the secondary defendants, a third brother and an associate. The
defendants generated revenues exceeding $1.1 million through this scheme and were con-
victed of misleading advertising contrary to s. 52(1). The court held that a significant sen-
tence was required to denounce this conduct and to demonstrate that this type of misleading
advertising is not merely unethical, but criminal. The primary defendants were each sen-
tenced to a three-year prison term and a $400,000 fine. With respect to the secondary de-
fendants, the brother received a conditional sentence of nine months and a fine of $100,000
and the associate received a conditional sentence of 18 months and a fine of $15,000. On
appeal, the sentence of the trial judge was upheld for the primary defendants but the fine for
the brother who was a secondary defendant was reduced to $35,000 because the amount of
the fine was disproportionate to the revenue from his actions and to his level of responsibil-
ity for the entire enterprise. The associate who was a secondary defendant did not participate
in the appeal. The Court of Appeal noted that sentencing decisions in s. 52(1) cases will
often involve an assessment of the following factors: the extent and impact of the misleading
material; the magnitude of the offence, including the time period and the geographic penetra-
tion of the dissemination of the material; and the economic impact on the public, on competi-
tors of the offenders and the financial benefit to the offenders.
R. v. Sunrise Lighting Distributors (Maritime) Ltd. (1992), 48 C.P.R. (3d) 289 (N.S. Prov.
Ct.) — The accused had advertised that lamps had been imported directly from Italy. Al-
though they had been made in Italy, he had actually imported them from Toronto. It was held
that consumers would be primarily interested in the fact that the lamps were made in Italy
and not whether they had been imported directly or indirectly. Therefore, the misrepresenta-
tion was held not to be material.
R. v. Wholesale Travel Group Inc., [1991] 3 S.C.R. 154, 8 C.R. (4th) 145, 38 C.P.R. (3d)
451, 67 C.C.C. (3d) 193, 84 D.L.R. (4th) 161, 7 C.R.R. (2d) 36, 130 N.R. 1, 49 O.A.C. 161.
R. v. Sears Canada Inc. (1989), 28 C.P.R. (3d) 248 (Ont. Dist. Ct.) — The accused’s ad for
an air conditioner stated “price applies to basic installation”, although the cost of installation
was in fact not included. The word “installation” appeared at the top of the ad with a notice
indicating that the cost of installation was extra. However, the ad referred to products other
than the air conditioner, and, read in its entirety applying the common sense principle, was
open to only one interpretation — that installation was included in the price of the air condi-
tioner. A person making a significant monetary commitment in the $1,200 range would be
141
intelligent and literate and would read the advertisement carefully. Section 60(2) does not
relieve the Crown of proving beyond a reasonable doubt all the essential elements of the
offence and it had done so. Nothing in the evidence established a defence of due diligence.
See also the sentencing entry below.
R. v. Simpsons Ltd. (1988), 25 C.P.R. (3d) 34 (Ont. Dist. Ct.) — The accused distributed
over one million one-day discount cards, each containing four tabs hiding the discount per-
cent, representing that the holder could save from 10% to 25% on almost everything in the
store. Ninety percent of the cards had a discount figure of 10% under each of the four tabs.
The representation was false or misleading in a material respect in that it gave the impression
that a different percentage appeared under each tab. The promotion was not a contest, lottery
or game within the meaning of s. 59 [now s. 74.06] but it did dispose of a benefit — a
discount — by a mode of chance and accordingly fell within that section. As the accused had
failed to disclose the limited odds of winning a discount greater than 10%, it was guilty of an
offence under this section. However, since the essential offence alleged on all three counts
was the failure to disclose the odds, only one conviction would be entered and the other two
stayed conditionally pending disposition of any appeal or expiration of the time for appeal.
Sections 52(1)(a) [now s. 52(1)] and 59 in combination do not create an absolute liability
offence but rather create a strict liability offence and thus do not offend ss. 7 or 11(d) of the
Charter.
R. v. Fitopco Inc. (1988), 22 C.P.R. (3d) 41 (Ont. Dist. Ct.) — The term “regular prices” in
an advertisement must be deemed to refer to the prices at which the product was sold by
sellers generally in the market area, including other locations of the accused’s business in
that area. Accordingly, it is not critical that the accused never sold the product at the regular
prices unless clearly specified otherwise.
R. v. Total Ford Sales Ltd. (1987), 18 C.P.R. (3d) 404 (Ont. Dist. Ct.); varying (July 11,
1986), Charles Prov. J. (Ont. Prov. Ct.) — Whether an advertisement is to be construed as
false or misleading in a material respect is a question of law alone, and the test to be applied
is the meaning that would be discerned by the average person at whom the ad is directed.
The accused’s ads left the false and misleading impression that the cars advertised were new
when in fact they were used. The trial judge did not err in fact or in law and accordingly the
appeal against conviction was dismissed.
Sentence — The 22 counts were based on six advertisements in major Toronto newspapers
over a period of six months. The accused cooperated fully and discontinued the advertise-
ments when the conduct complained of was drawn to its attention. Fines imposed should be
per advertisement rather than for each item complained of in the ad. The fine of $3,000 for
each of the 22 counts was accordingly reduced to $3,000 per ad plus $100 for each addi-
tional item in the ads for a total fine of $19,600.
R. v. Muralex Distributions Inc./Distributions Muralex Inc. (1987), 15 B.C.L.R. (2d) 151
(Co. Ct.); leave to appeal refused (May 10, 1989), Doc. No. CA008106, [1989] B.C.W.L.D.
1521, [1989] C.L.D. 830 (B.C. C.A.) — The test to be applied to mass mail offers is the
understanding of the average householder. Such mass mailings are not directed at a specific
and identifiable group of people who can be deemed to be sophisticated in assessing such
offers but rather they are sent indiscriminately. This test should be applied to the whole of
the document, that is, one must consider the immediate impression of the advertisement on
the average householder to determine whether it was false or misleading. Much of the Act,
including this section, is devoted to the protection of the public from unfair or unscrupulous
trade practices. It does not relate only to the sale or use of products. Sentence — The ac-
cused, a mail order company and its sole director/president, were each fined $15,000. Each
had a prior conviction for a similar offence. Deterrence was the main object of the sentence.
142
R. v. Cdn. Tire Corp. (1986), 14 C.P.R. (3d) 372 (Man. Prov. Ct.); appeal from conviction
dismissed, appeal on sentence allowed [1987] C.L.D. 932 (Man. C.A.) — The accused ad-
vertised in a catalogue and newspaper new valves, springs and pushrods. The parts were in
fact reconditioned, argued by the accused to be as good as new. The emphasis on the word
“new” in the advertisement indicates that this was an important consideration and the word is
clear and concise in meaning. To represent the reconditioned parts as new was false and
Act
misleading in a material respect. A market survey suggesting the word “new” had little or no
impact on perspective purchasers was irrelevant. Sentence — On appeal the fines were re-
duced to $25,000 on the first count and $10,000 on the second count, taking into account the
mitigating factor that there had been no intent to defraud or cheat the public. The ads con-
tained false information by error rather than by design.
R. v. Pneus Grand Prix Ltée, 1985 CarswellQue 344 (C.S.P. Qué.) — Certain advertisements
of the accused referred to a sale of tires at 40 to 50% off. Others offered a second tire free or
for $1 if the first tire was purchased at catalogue price. The accused was acquitted on
charges of false or misleading advertising. There was no evidence that the accused would not
have sold tires at the catalogue price. The advertisements were sufficiently clear for the aver-
age and reasonable customer to understand the nature of the offers.
Freeway Plymouth Chrysler Ltd. v. R., [1986] B.C.W.L.D. 448 (Co. Ct.) — If there are two
or more constructions of the language used in an advertisement, on one of which an offence
would be made out, the advertisement must bear this construction beyond a reasonable doubt
in order for a conviction to result. Prior advertisements are not admissible as an aid in inter-
preting the advertisement at issue, unless the prior advertisement is proffered as evidence of
similar acts.
R. v. Dyck, [1984] 6 W.W.R. 425, 35 Sask. R. 229 (Prov. Ct.) — The term “factory prices”
does not indicate whether it is factory prices to an individual customer or to a retailer which
are meant. Such ambiguity in the meaning of words must be construed in a manner favour-
able to the accused.
R. v. K.B.M. Electropedic Adjustable Beds Ltd. (1983), 75 C.P.R. (2d) 58, 50 A.R. 76
(Q.B.) — If a retailer normally sells a product at an outrageous price, it is not false or mis-
leading within the meaning of this subsection to advertise the product at that price, or to
advertise a special lower price, although that price may also be outrageous.
R. v. Skylark Holidays Ltd. (1981), 51 Nfld. & P.E.I.R. 248 (Nfld. Dist. Ct.) — The descrip-
tion of a hotel in the accused’s brochure was rendered inaccurate by a subsequent fire. The
accused promptly notified travel agents of the damage to the hotel, but one such agent failed
to pass the information on to a customer. This failure by the travel agent did not constitute a
false representation by the accused.
R. v. Int. Vacations Ltd. (1980), 33 O.R. (2d) 327, 56 C.P.R. (2d) 251, 22 C.R. (3d) 382, 59
C.C.C. (2d) 557, 124 D.L.R. (3d) 319 (C.A.) — An advertisement containing a schedule of
European air flights in small print and a statement at the bottom in ordinary print “Please
check individual flight availability ... as some flights may be sold out” was not false or
misleading and did not hold out to the public that seats were available on all flights listed.
The average reader interested in travelling overseas can be taken to be literate, intelligent,
and unlikely to make a relatively large monetary commitment without carefully reading the
advertisement: the import of the advertisement would be absolutely clear to such a discern-
ing reader.
R. v. Kenitex Can. Ltd. (1980), 51 C.P.R. (2d) 103; appeal on acquittal of individual accused
only allowed (sub nom. R. v. Fell) 34 O.R. (2d) 665, 59 C.P.R. (2d) 34, 64 C.C.C. (2d) 456,
131 D.L.R. (3d) 105 (C.A.) — A representation is false or misleading in a material respect if,
143
in the context in which it is made, it readily conveys an impression to the ordinary citizen
which is in fact false or misleading, and if that citizen would be likely to be influenced. The
offence is one of strict liability; to escape liability the accused must therefore show that he
took all the care a reasonable man would take to determine if the representation were true
and that he honestly believed it to be true. An accused commits a separate offence each time
a representation is made, even if the objective of each representation is the same. Separate
convictions for each representation do not accordingly violate the Kienapple principle. Sen-
tence — The accused had made exaggerated claims concerning a paint, which was a good
and widely used product but not appropriate for the universal use which the accused pro-
moted. Factors to be considered were protection of the public, general deterrence, the finan-
cial ability of the accused, and totality. A fine should not be a mere licence fee, but it should
not bankrupt the company. Fines of $5,000 on each of 6 counts, for a total of $30,000, were
imposed.
R. v. Scotia Chevrolet Oldsmobile Ltd. (1980), 62 C.P.R. (2d) 172, 44 N.S.R. (2d) 410, 83
A.P.R. 410 (Co. Ct.) — A sale advertisement advertised a “Was” price for trucks, being the
manufacturer’s recommended price, although the dealer had made no sales at that price dur-
ing any relevant period. Any reasonable person would conclude he could make a better bar-
gain during the sale, which was not so, and accordingly the advertisement was misleading.
R. v. Irving Oil Ltd. (1978), 47 C.P.R. (2d) 179 (N.B. Prov. Ct.) — A large sign stating “6¢
off per gallon” beside a gas station selling gas at the same price as neighbouring stations and
as other stations owned by the same company was posted for the sole purpose of influencing
the public and was false or misleading. The travelling public, which includes the ignorant,
unthinking and credulous, would be influenced or enticed by the sign to buy gas.
R. v. Michaud (1978), 40 C.P.R. (2d) 63, 41 C.C.C. (2d) 139 (Ont. Dist. Ct.) — The ac-
cused’s ad stated “stuff envelopes, $500 per thousand immediately”. Those replying and
sending the $5 requested were merely offered the opportunity of having their availability
made known to various publications, or of being given advice on how to implement similar
schemes themselves. The general impression created by the ad was misleading and accord-
ingly the accused was guilty.
R. v. Park Realty Ltd. (1978), 2 C.R. (3d) 336 (Man. Prov. Ct.) — The test as to whether a
statement in an advertisement is misleading is the meaning taken not by the skilled and
knowledgeable members of the public but by the uninitiated and inexperienced who became
exposed to the advertisement. It is a subjective as well as an objective test. It is not what is in
the mind of the advertiser in publishing the advertisement, but what actual effect the wording
has on the public and what is the public’s understanding of the meaning conveyed by the
words used in an advertisement. A statement that an old house is in “top condition” must be
taken in context. However, if the purpose of the legislation is to establish more ethical trade
practices, then the courts have a duty to caution those resorting to phrases such as “top con-
dition”, “A-1”, “excellent buy” that such phrases be applied carefully and only quite truth-
fully. While in the mind of the knowledgeable the house here was in “top condition” relative
to its age, to the uninitiated, to the average reader or viewer, that phrase conveyed the im-
pression that more or less everything of substance was in excellent condition, from roof to
basement. That was not the case. Therefore the representation was a false or misleading
statement.
R. v. WCC Publishing Ltd. (1978), 44 C.P.R. (2d) 64 (Que. S.P.) — An advertisement stating
the accused would pay delivery costs apart from those specified was not false or misleading
in failing to state that the purchaser was responsible for customs duties and federal sales tax
since a purchaser normally pays sales tax and must pay customs duties. Ignorance of the law
is no excuse.
144
R. v. Lowe Real Estate Ltd. (1978), 40 C.C.C. (2d) 529 (Ont. C.A.) — The words “absolutely
the lowest price in Erin Mills” in a house advertisement could mean either a house of the
nature advertised or any house. Given that there were two possible constructions, one of
which was true, a conviction was not sustainable. However, pictures shown with the adver-
tisements, which stated “Variations of houses as shown below”, did not depict what was
being sold and accordingly constituted false advertising. Sentence — A fine of $3,000 was
Act
upheld.
R. v. Simpsons-Sears Ltd. (1976), 28 C.P.R. (2d) 249 (Ont. Co. Ct.) — The accused’s sale
catalogue advertised bottles of 100 vitamin tablets at a price of 1/$3.98, 2/$3.90. In its gen-
eral catalogue bottles of 250 tablets were priced at $3.79. Bottles of 100 were not sold in the
general catalogue. What the accused meant by the advertisement was not relevant, but rather
what effect it actually had on the probable or possible consumer (applying R. v. Family Tire
Centres Ltd. (1975), 25 C.P.R. (2d) 219, 28 C.C.C. (2d) 474 (Ont. C.A.)). The advertisement
as a whole was deceptive and misleading since it gave the impression that bottles of 100
tablets were ordinarily sold for $3.89. Sentence — This manner of merchandising had con-
tinued for three years and had resulted in sales of $118,812. The accused had ceased the
practice when the charges were laid, but it had two previous convictions concerning advertis-
ing. A fine of $7,500 was imposed.
R. v. Discount Broadloom Centre Ltd. (1976), 31 C.P.R. (2d) 110 (Ont. Co. Ct.) — The
granting of a trade mark “Factory Carpet Outlet” to the accused by the Registrar of Trade
Marks did not act as an estoppel against quasi-criminal proceedings concerning advertising
containing such words. Since the accused’s place of business was not a factory, the public
would be misled, and accordingly the accused was convicted.
R. v. Steinberg’s Ltd. (1976), 13 O.R. (2d) 293, 26 C.P.R. (2d) 109, 31 C.C.C. (2d) 30, 70
D.L.R. (3d) 624 (C.A.) — An advertisement stating the price of goods must be true at the
time it is published. It cannot be made untrue by subsequent events. Accordingly, the ac-
cused was guilty of untrue, deceptive or misleading advertising in relation to goods on its
shelves marked with prices higher than advertised, but was not guilty on charges relating to
advertised items later being out of stock since there was no evidence they were not in stock
at the time of publication of the advertisement. The advertisement was not a statement of
present intention that the accused “would sell” at the listed price if errors in marked prices
were brought to its attention. Sentence — The errors in price marking were contrary to com-
pany policy and specific directions. The accused did not deliberately break the law but rather
failed to ensure its employees observed it. Accordingly, fines were reduced on appeal to
$5,000 for each of the two advertisements involved.
R. v. Family Tire Centres Ltd. (1975), 25 C.P.R. (2d) 219, 28 C.C.C. (2d) 474 (Ont. C.A.) —
The accused’s advertising indicated that a person buying one tire for list price could have a
second for 1 cent. In the ordinary course of business the accused sold tires for about one-half
of list price, using them as a loss leader. The advertisement was therefore untrue, deceptive
or misleading. Sentence — The accused’s sales were $3M gross, 50 per cent being for tire
sales on which it made no net profit. Deterrence and protection of the public are major con-
cerns in sentencing. A $5,000 fine was appropriate. A prohibition order was also appropriate,
since the illegal practice was the basic reason for the accused’s success and it was continued
until at least the date of conviction.
R. v. T. Eaton Co. (1975), 26 C.P.R. (2d) 118 (Alta. T.D.) — An advertisement stating that a
calculator “deals in square roots and squares” etc. and that “it’s one of the handiest little
calculators any engineer or architect could want” could only be taken to mean that the ma-
chine will assist the operator in performing the functions described. Being a sophisticated
machine it called for some sophistication on the part of the person using it. The advertise-
145
ment as a whole could not fail to make that clear to the reader. The accused was therefore
not guilty.
R. v. Nat. Upholstering Mfg. (1964) Ltd. (1975), 23 C.P.R. (2d) 23, 27 C.C.C. (2d) 551
(Man. Co. Ct.) — The accused’s advertisements stated “Factory-to-you eliminates the mid-
dleman”. The accused did not manufacture most of the furniture it sold but rather only as-
sembled it, and accordingly the advertisement was untrue. It was not relevant that a pur-
chaser could achieve the savings claimed, nor that the Crown had not proved anyone was
misled or deceived.
R. v. T. Eaton Co., [1974] 4 W.W.R. 484, 15 C.P.R. (2d) 25, 17 C.C.C. (2d) 501, 47 D.L.R.
(3d) 746 (Man. C.A.); affirming 12 C.P.R. (2d) 276, 14 C.C.C. (2d) 124 (Man. Q.B.) — The
accused advertised tools as “specially priced at Eaton’s”. The prices were as shown in the
manufacturer’s catalogue, which were shown as a “price break-through”. The manufacturer’s
packages also had “special” printed on them. The prices charged were the same or higher
than those of its competitors. The advertisement was deceptive or misleading, and the ac-
cused was convicted.
Alta. Giftwares Ltd. v. R., [1974] S.C.R. 584, [1973] 5 W.W.R. 458, 11 C.P.R. (2d) 233, 11
C.C.C. (2d) 513, 36 D.L.R. (3d) 321 — The accused’s discount catalogue stated “Whenever
obtainable, we have included manufacturer’s suggested retail prices. Where no such price is
available we have ourselves suggested what we feel to be a fair retail price.” The accused
actually had manufacturer’s retail prices for all items for which it listed its own retail prices.
The trial judge had, however, considered these to be unrealistic since they were intended to
apply in the Montreal area where the items were manufactured, and prices would be higher
in Edmonton. In so deciding the trial judge had erred in law in the meaning he assigned to
“available”. Since the accused had the manufacturer’s suggested retail price the catalogue
was untrue, and accordingly the accused had knowingly published an advertisement which
was untrue, deceptive or misleading.
R. v. Standard Metal Prod. Ltd. (1973), 15 C.P.R. (2d) 39 (Sask. Q.B.) — The accused’s
advertisement stated “Wholesale from factory to you. No dealer markup to pay”. Since the
accused actually purchased from the selling arm of the manufacturer, which was an indepen-
dent company, and charged substantially more than it paid for its products, the advertisement
was untrue, deceptive and misleading.
R. v. Cunningham Drug Stores Ltd. (1973), 13 C.P.R. (2d) 244, 17 C.C.C. (2d) 279, 47
D.L.R. (3d) 47 (B.C. C.A.); affirming (1972), 8 C.P.R. (2d) 127, 12 C.C.C. (2d) 4 (B.C.
Prov. Ct.) — The trial judge found that the appropriate trading area in which to compare
prices of the accused’s Burnaby store was the Greater Vancouver area. This was a finding of
fact not to be disturbed on appeal. Since the Crown had established lower prices being
charged in that area, the accused’s advertisement that it offered “the best possible dollar
value and saving on every item, every day” was untrue, deceptive or misleading. What in
former days might have been regarded as mere puffing was now an offence.
R. v. Sutson Ltd. (1972), 6 C.P.R. (2d) 246 (Ont. Co. Ct.) — It is incumbent on the Crown to
prove that the material complained of was misleading to the average credulous person. Mate-
rial which may be capable of different interpretations is not per se deceptive or misleading.
R. v. S.S. Kresge Co. (1972), 5 C.P.R. (2d) 133 (Alta. S.C.) — The accused advertised “New
Year Bargains”, which to the average mind would suggest lower than usual prices. However,
the prices advertised were the accused’s regular prices. The accused was therefore guilty of
misleading advertising.
146
Subsection (2)(d)
R. v. Wonder Steel Bldg. (Central) Ltd. (1981), 56 C.P.R. (2d) 103, 59 C.C.C. (2d) 372 (Ont.
Co. Ct.) — To constitute door-to-door selling there must be some evidence that the person
making the representation at the buyer’s home appeared either in the course of canvassing,
selling, calling, etc., at a number of houses in a defined area, or at the home of a person
whose name appears on a restricted list of persons to be called on.
Act
Subsection (4)
Vidéotron, s.e.n.c. c. Bell Canada, 2015 QCCS 1663 (C.S. Que.) — The court dismissed the
motion for an interlocutory injunction that would have required Bell Canada to remove ad-
vertisements promoting its new optic fiber services. Videotron considered the advertisements
to be false and misleading because they indicated that Bell’s fiber optic service is offered
throughout Quebec when, in reality, Bell was not able to provide services to the majority of
the target market. Videotron accused Bell of adopting a “bait and switch” approach to at-
tracting new customers. The court concluded that Bell’s advertisements were not conveying
the general impression that Bell was offering its services to all customers because it had
specifically advertised that its services were available only where access and technology
permit.
Richard v. Time Inc., 2012 SCC 8, [2012] 1 S.C.R. 265 (S.C.C.) — The Supreme Court
considered the meaning of the “general impression” test found in s. 218 of the Quebec Con-
sumer Protection Act, which is largely based upon subs. 52(4) of the Competition Act. In the
case of false or misleading advertising, the general impression is the one a person has after
an initial contact with the entire advertisement, and it relates to both the layout of the adver-
tisement and the meaning of the words used. It is analysed without considering the personal
attributes of the consumer who has instituted proceedings against the merchant. To be con-
sistent with the legislature’s objective of protecting vulnerable persons from the dangers of
certain advertising techniques, the general impression test must be applied from the perspec-
tive of the average consumer, who is credulous and inexperienced and takes no more than
ordinary care to observe that which is staring him or her in the face upon first entering into
contact with an entire advertisement.
R. v. J. Clark & Son Ltd. (1986), 71 N.B.R. (2d) 257, 182 A.P.R. 257 (Q.B.); leave to appeal
to N.B. C.A. refused (September 25, 1986), Doc. No. 148/86/CA (N.B. C.A.) — An adver-
tisement offered car financing at 4.9 per cent for a limited time, and invited readers to visit
for complete details. What the accused in fact did was provide a cash rebate sufficient to
reduce a purchaser’s effective interest rate to 4.9 per cent for six months. The trial judge
acquitted the accused on the grounds that the average person of reasonable intelligence and
reasonably well-informed would understand that the terms and conditions of financing vary
and should be checked. Nothing in the ad suggested the 4.9 per cent financing would last for
any specific time. An appeal was dismissed. Considering the language of the entire adver-
tisement, its initial meaning, and the impression it conveyed, the advertisement was not
misleading.
R. v. Westfair Foods Ltd. (Supervalu), [1985] 3 W.W.R. 423, 5 C.P.R. (3d) 373, 18 C.C.C.
(3d) 178, 38 Sask R. 12, 16 D.L.R. (4th) 669 (Q.B.) — The accused’s advertisement com-
pared its prices to those of a competitor. In certain cases it indicated the product was not
available. In some of these cases the competitor sold a similar product, but not sufficiently
similar to be comparable. In these circumstances the trial judge did not err in holding that the
representation was not false or misleading in a material respect, and had properly considered
subs. (4).
147
R. v. 359286 Ont. Ltd. (1981), 58 C.P.R. (2d) 169 (Nfld. Prov. Ct.) — A television advertise-
ment showed a nail file being drawn across panty hose without any apparent damage result-
ing. It did not, however, tell the viewer that a certain amount of tension had to be put on the
hose for this to happen. The general impression was that the test could be done in the manner
apparently portrayed, and thus the advertisement was misleading in a material respect.
R. v. K-Mart Can. Ltd. (1978), 50 C.P.R. (2d) 271 (N.S. Co. Ct.). Similarly R. v. K-Mart
Can. Ltd., [1980] 2 W.W.R. 548, 52 C.C.C. (2d) 223, 24 A.R. 505 (Q.B.) — The accused
advertised that if you left your film for developing and printing with them they would pro-
vide a new roll of film at no charge. In fact the cost of the film was included in the price, and
a cash rebate was given to those who did not want the film. The advertising having created
the general impression that the film was free, it was false or misleading in a material respect.
Subsection (5)
R. v. Fuel Base Industries Inc. (1992), 4 Alta. L.R. (3d) 188, 44 C.P.R. (3d) 184 (Prov.
Ct.) — In cases involving false claims regarding gas saving additives, the paramount con-
cern in sentencing is general deterrence. Other facts to consider include the size and profit-
ability of the operation, prior criminal activity, and attempts to comply with the law. Corpo-
rations cannot hide behind their own failure to test products in order to reduce their liability
under the law.
52.01 (1) False or misleading representation — sender or subject

matter information — No person shall, for the purpose of promoting, di-
rectly or indirectly, any business interest or the supply or use of a product,
knowingly or recklessly send or cause to be sent a false or misleading repre-
sentation in the sender information or subject matter information of an elec-
tronic message.
(2) False or misleading representation — electronic message —
No person shall, for the purpose of promoting, directly or indirectly, any busi-
ness interest or the supply or use of a product, knowingly or recklessly send or
cause to be sent in an electronic message a representation that is false or mis-
leading in a material respect.
(3) False or misleading representation — locator — No person shall,
for the purpose of promoting, directly or indirectly, any business interest or
the supply or use of a product, knowingly or recklessly make or cause to be
made a false or misleading representation in a locator.
(4) Proof of deception not required — For greater certainty, in estab-
lishing that any of subsections (1) to (3) was contravened, it is not necessary to
prove that any person was deceived or misled.
travention of any of subsections (1) to (3), the general impression conveyed by
a representation as well as its literal meaning are to be taken into account.
148
Part VI — Offences (ss. 45-62) S. 52.02(1)(b)(ii)
(6) Offence and punishment — Any person who contravenes any of sub-
sections (1) to (3) is guilty of an offence and
(a) liable on conviction on indictment to a fine in the discretion of the
court or to imprisonment for a term not exceeding 14 years, or to both; or
(b) liable on summary conviction to a fine not exceeding $200,000 or to
Act
imprisonment for a term not exceeding one year, or to both.
(7) Reviewable conduct — Nothing in Part VII.1 is to be read as excluding
the application of this section to the making of a representation that consti-
tutes reviewable conduct within the meaning of that Part.
(8) Where application made under Part VII.1 — No proceedings may
be commenced under this section against a person on the basis of facts that are
the same or substantially the same as the facts on the basis of which an order
against that person is sought under Part VII.1.
(9) Interpretation — For the purposes of this section,
(a) an electronic message is considered to have been sent once its trans-
mission has been initiated; and
(b) it is immaterial whether the electronic address to which an electronic
message is sent exists or whether an electronic message reaches its in-
tended destination.
2010, c. 23, s. 75
52.02 (1) Assisting foreign states — The Commissioner may, for the pur-
pose of assisting an investigation or proceeding in respect of the laws of a for-
eign state, an international organization of states or an international organiza-
tion established by the governments of states that address conduct that is
substantially similar to conduct prohibited under section 52, 52.01, 52.1, 53, 55
or 55.1,
(a) conduct any investigation that the Commissioner considers necessary
to collect relevant information, using any powers that the Commissioner
may use under this Act or the Criminal Code to investigate an offence
under any of those sections; and
(b) disclose the information to the government of the foreign state or to
the international organization, or to any institution of any such govern-
ment or organization responsible for conducting investigations or initiat-
ing proceedings in respect of the laws in respect of which the assistance is
being provided, if the government, organization or institution declares in
writing that
(i) the use of the information will be restricted to purposes relevant
to the investigation or proceeding, and
(ii) the information will be treated in a confidential manner and, ex-
cept for the purposes mentioned in subparagraph (i), will not be fur-
ther disclosed without the Commissioner’s express consent.
149
(2) Mutual assistance — In deciding whether to provide assistance under

subsection (1), the Commissioner shall consider whether the government, or-
ganization or institution agrees to provide assistance for investigations or pro-
ceedings in respect of any of the sections mentioned in subsection (1).
2010, c. 23, s. 75
52.1 (1) Definition of “telemarketing” — In this section, “telemarketing”

means the practice of communicating orally by any means of telecommunica-
tion for the purpose of promoting, directly or indirectly, any business interest
or the supply or use of a product.
(2) Required disclosures — No person shall engage in telemarketing
unless
(a) disclosure is made, in a fair and reasonable manner at the beginning
of each communication, of the identity of the person on behalf of whom
the communication is made, the nature of the business interest or product
being promoted and the purposes of the communication;
(b) disclosure is made, in a fair, reasonable and timely manner, of the
price of any product whose supply or use is being promoted and any ma-
terial restrictions, terms or conditions applicable to its delivery; and
(c) disclosure is made, in a fair, reasonable and timely manner, of such
other information in relation to the product as may be prescribed by the
regulations.
(3) Deceptive telemarketing — No person who engages in telemarketing
shall
(a) make a representation that is false or misleading in a material respect;
(b) conduct or purport to conduct a contest, lottery or game of chance,
skill or mixed chance and skill, where
(i) the delivery of a prize or other benefit to a participant in the con-
test, lottery or game is, or is represented to be, conditional on the
prior payment of any amount by the participant, or
(ii) adequate and fair disclosure is not made of the number and ap-
proximate value of the prizes, of the area or areas to which they re-
late and of any fact within the person’s knowledge, that affects mate-
rially the chances of winning;
(c) offer a product at no cost, or at a price less than the fair market value
of the product, in consideration of the supply or use of another product,
unless fair, reasonable and timely disclosure is made of the fair market
value of the first product and of any restrictions, terms or conditions ap-
plicable to its supply to the purchaser; or
(d) offer a product for sale at a price grossly in excess of its fair market
value, where delivery of the product is, or is represented to be, conditional
on prior payment by the purchaser.
150
Part VI — Offences (ss. 45-62) S. 52.1(10)(b)

travention of paragraph (3)(a), the general impression conveyed by a repre-
sentation as well as its literal meaning shall be taken into account in determin-
ing whether or not the representation is false or misleading in a material
respect.
Act
(5) Time of disclosure — The disclosure of information referred to in par-
agraph (2)(b) or (c) or (3)(b) or (c) must be made during the course of a com-
munication unless it is established by the accused that the information was
disclosed within a reasonable time before the communication, by any means,
and the information was not requested during the communication.
(6) Due diligence — No person shall be convicted of an offence under this
section who establishes that the person exercised due diligence to prevent the
commission of the offence.
(7) Offences by employees or agents — Notwithstanding subsection
(6), in the prosecution of a corporation for an offence under this section, it is
sufficient proof of the offence to establish that it was committed by an em-
ployee or agent of the corporation, whether or not the employee or agent is
identified, unless the corporation establishes that the corporation exercised
due diligence to prevent the commission of the offence.
(8) Liability of officers and directors — Where a corporation commits
an offence under this section, any officer or director of the corporation who is
in a position to direct or influence the policies of the corporation in respect of
conduct prohibited by this section is a party to and guilty of the offence and is
liable to the punishment provided for the offence, whether or not the corpora-
tion has been prosecuted or convicted, unless the officer or director establishes
that the officer or director exercised due diligence to prevent the commission
of the offence.
(2) or (3) is guilty of an offence and liable
(10) Sentencing — In sentencing a person convicted of an offence under this
section, the court shall consider, among other factors, the following aggravat-
ing factors:
(a) the use of lists of persons previously deceived by means of
telemarketing;
(b) characteristics of the persons to whom the telemarketing was directed,
including classes of persons who are especially vulnerable to abusive
tactics;
151
S. 52.1(10)(c) Competition Act
(c) the amount of the proceeds realized by the person from the
telemarketing;
(d) previous convictions of the person under this section or under section
52 in respect of conduct prohibited by this section; and
(e) the manner in which information is conveyed, including the use of
abusive tactics.
1999, c. 2, s. 13; 2009, c. 2, s. 415; 2010, c. 23, s. 76; 2014, c. 31, s. 34(1)
Commentary
Section 52.1 makes it an offence where “interactive telephone communications” are used to
make false or misleading representations in promoting the supply of a product or a business
interest. In its Enforcement Guidelines — Telemarketing — Section 52.1 of the Competition
Act, the Bureau has clarified that the term “interactive telephone communications” will be
interpreted as live voice communications between two or more persons. The Bureau does not
consider that communications occurring through fax, Internet or automated pre-recorded
messages are “interactive telephone communications”; however, these forms of communica-
tion are subject to the general provision relating to false or misleading representations under
ss. 52 and 74.01 of the Act.
Subsection 52.1(2) requires strict disclosure to help potential victims make informed deci-
sions and distinguish between legitimate telemarketers and scams. All telemarketers are re-
quired, at the beginning of the telephone call, to disclose the following:
• the name of the company or person they are working for;
• the type of product or business interest they are promoting; and
• the price of any product being sold, and any restrictions or conditions that must be met
before the product will be delivered.
At the same time, telemarketers are prohibited, under subs. 52.1(3) from engaging in the
following practices:
• making payment in advance a condition for receiving a prize that had been, or suppos-
edly has been, won in a contest or game;
• failing to provide adequate and fair disclosure of the number and value of the “prizes”;
• offering a “gift” as an inducement to buy another product, without fairly disclosing the
value of the gift; or
• offering a product at a grossly inflated price and requiring payment in advance.
Unlike the misleading advertising provisions (subs. 52(1)), there is no specific mens rea
requirement but the defence of due diligence is available (subs. 52.1(6)). Officers and direc-
tors of companies engaged in deceptive telemarketing may also be charged as parties to the
offence and found guilty unless they establish that they exercised due diligence to prevent
the offence. The maximum penalty for deceptive marketing is 14 years’ imprisonment, and a
fine in the discretion of the court (subs. 52.1(9)).
The majority of judicial consideration of section 52.1 is found in extradition cases, which
require an extradition judge to determine (i) the admissibility of the evidence and (ii)
whether that admissible evidence would be sufficient to justify committal for trial in Canada
if the events had occurred in Canada. See e.g. United States v. Edwards, 2009 CarswellBC
3756 (B.C.S.C.); United States v. Costanzo (2008), 234 C.C.C. (3d) 108 (B.C.S.C.); affirmed
2009 CarswellBC 878 (B.C.C.A.); leave to appeal refused 2009 CarswellBC 2262, 2009
152
Part VI — Offences (ss. 45-62) S. 53(2)(b)
CarswellBC 2263 (S.C.C.); and United States v. Yemec (2003), 67 O.R. (3d) 394 (Ont.
S.C.J.); affirmed 2005 CarswellOnt 1164 (Ont. Div. Ct.); additional reasons at 2005 Cars-
wellOnt 3274 (Ont. Div. Ct.).
provisions of the Act may be found in Enforcement Guidelines Telemarketing — Section
52.1 of the Competition Act (Ottawa: Competition Bureau, October 2009).
Act
Case Law
In October 2016, a third individual was sentenced to 16 months of imprisonment to be
served in the community and to two years’ probation for deceptive telemarketing activities
related to office supplies and medical kits including falsely implying that the caller repre-
sented a business that had an existing relationship with the victim’s company, indicating that
certain products or services were required under government rules, or implying that the call
was being made on behalf of a government agency.
R. v. Cheung, 2011 ABQB 225 (Alta. Q.B.) — The accused, principals and managers of a
Canadian telemarketing firm selling an American business registry, were charged with,
among other things, deceptive marketing practices, including making false or misleading
representations under section 52 and deceptive telemarketing under section 52.1. The ac-
cused designed and implemented questionable sales techniques that included creating a false
impression by the target of the call that the business directory product had been previously
ordered by the target’s company. The court considered whether the accused should be
charged under both section 52 and section 52.1 for the same conduct, concluding that the
intention of Parliament was to specifically deal with all telemarketing misrepresentations
under section 52.1 and that identical conduct should not be caught by both provisions. The
court noted that if an accused’s conduct falls within the defined activity of telemarketing,
that the representation need only be false or material in a material way and need not, as in
section 52, be made to the public. In respect of the s. 52.1(2)(a) charges, each of the accused
was found guilty of engaging in telemarketing activity and failing to disclose the purpose of
the communication.
53. (1) Deceptive notice of winning a prize — No person shall, for the
purpose of promoting, directly or indirectly, any business interest or the sup-
ply or use of a product, send or cause to be sent by electronic or regular mail
or by any other means a document or notice in any form, if the document or
notice gives the general impression that the recipient has won, will win, or will
on doing a particular act win, a prize or other benefit, and if the recipient is
asked or given the option to pay money, incur a cost or do anything that will
incur a cost.
(2) Non-application — Subsection (1) does not apply if the recipient actu-
ally wins the prize or other benefit and the person who sends or causes the
notice or document to be sent
(a) makes adequate and fair disclosure of the number and approximate
value of the prizes or benefits, of the area or areas to which they have
been allocated and of any fact within the person’s knowledge that materi-
ally affects the chances of winning;
(b) distributes the prizes or benefits without unreasonable delay; and
153
S. 53(2)(c) Competition Act
(c) selects participants or distributes the prizes or benefits randomly, or

on the basis of the participants’ skill, in any area to which the prizes or
benefits have been allocated.
(3) Due diligence — No person shall be convicted of an offence under this
section who establishes that the person exercised due diligence to prevent the
commission of the offence.
(4) Offences by employees or agents — In the prosecution of a corpo-
ration for an offence under this section, it is sufficient proof of the offence to
establish that it was committed by an employee or agent of the corporation,
whether or not the employee or agent is identified, unless the corporation es-
tablishes that the corporation exercised due diligence to prevent the commis-
sion of the offence.
(5) Liability of officers and directors — Where a corporation commits
an offence under this section, any officer or director of the corporation who is
in a position to direct or influence the policies of the corporation in respect of
conduct prohibited by this section is a party to and guilty of the offence and is
liable to the punishment provided for the offence, whether or not the corpora-
tion has been prosecuted or convicted, unless the officer or director establishes
that the officer or director exercised due diligence to prevent the commission
of the offence.
(6) Offence and punishment — Any person who contravenes this section
is guilty of an offence and liable
(7) Sentencing — In sentencing a person convicted of an offence under this
section, the court shall consider, among other factors, the following aggravat-
ing factors:
(a) the use of lists of persons previously deceived by the commission of an
offence under section 52.1 or this section;
(b) the particular vulnerability of recipients of the notices or documents
referred to in subsection (1) to abusive tactics;
(c) the amount of the proceeds realized by the person from the commis-
sion of an offence under this section;
(d) previous convictions of the person under section 52 or 52.1 or this sec-
tion; and
(e) the manner in which information is conveyed, including the use of
abusive tactics.
2002, c. 16, s. 6; 2009, c. 2, s. 416
154
Part VI — Offences (ss. 45-62) S. 54(1)
Commentary
This provision creates a criminal offence for deceptive prize notices. Unlike certain other
deceptive marketing practices, this offence may only be prosecuted as a criminal matter, and
the Commissioner of Competition does not have the option of pursuing it as an administra-
tive offence. The offence under s. 53(1) of the Act is committed if the following four ele-
ments are present:
Act
• a person sends, or causes to be sent, by mail or e-mail, a document or notice in any
form;
• the document or notice is for the purpose of “promoting, directly or indirectly, any
business interest or the supply or use of a product”;
• the document or notice “gives the general impression that the recipient has won, will
win, or will win on doing a particular act, a prize or benefit”; and if
• the recipient is asked or given the option of paying money or doing anything to incur a
cost.
Section 53 creates a hybrid offence by which the Crown may proceed by way of summary
conviction or indictment. A summary conviction may result in a fine of up to $200,000
and/or one year in prison. A conviction on indictment may result in a fine in the discretion of
the court and/or up to 14 years in prison. In prosecuting a corporation, it is sufficient to
prove that the offence was committed by an employee or agent of the corporation, whether
or not that person is specifically identified. Where a corporation commits an offence under
this section, any officer or director of the corporation who is in a position to direct or influ-
ence the policies of the corporation in respect of the offence is a party to and guilty of the
offence.
Both a person and a corporation may escape liability if it is shown that “due diligence” was
exercised to prevent the commission of the offence. An offence is not committed if the fol-
lowing conditions are met:
• the recipient actually wins the prize or benefit;
• the sender makes adequate and fair disclosure of the number and approximate value of
the prizes or benefits, the areas to which the prizes have been allocated, and any facts
within the senders knowledge that materially affect the chances of winning;
• the prize or benefit is distributed without unreasonable delay; and
• participants are selected or the prizes are distributed randomly, or on the basis of the
participants’ skill, in any area to which the prizes or benefits have been allocated.
The implications for businesses are that they must take care to ensure that any promotional
contests conducted comply with the conditions set out in the provisions, including the need
to make adequate disclosure, and can meet a due diligence defence, if required.
provisions of the Act may be found in Guidelines on the Deceptive Notice of Winning a
Prize Provision — Section 53 of the Competition Act (Ottawa: Competition Bureau, April
2007).
54. (1) Double ticketing — No person shall supply a product at a price that
exceeds the lowest of two or more prices clearly expressed by him or on his
155
behalf, in respect of the product in the quantity in which it is so supplied and

at the time at which it is so supplied,
(a) on the product, its wrapper or container;
(b) on anything attached to, inserted in or accompanying the product, its
wrapper or container or anything on which the product is mounted for
display or sale; or
(c) on an in-store or other point-of-purchase display or advertisement.
(1) is guilty of an offence and liable on summary conviction to a fine not ex-
ceeding ten thousand dollars or to imprisonment for a term not exceeding one
year or to both.
55. (1) Definition of “multi-level marketing plan” — For the purposes

of this section and section 55.1, “multi-level marketing plan” means a plan for
the supply of a product whereby a participant in the plan receives compensa-
tion for the supply of the product to another participant in the plan who, in
turn, receives compensation for the supply of the same or another product to
other participants in the plan.
(2) Representations as to compensation — No person who operates or
participates in a multi-level marketing plan shall make any representations
relating to compensation under the plan to a prospective participant in the
plan unless the representations constitute or include fair, reasonable and
timely disclosure of the information within the knowledge of the person mak-
ing the representations relating to
(a) compensation actually received by typical participants in the plan; or
(b) compensation likely to be received by typical participants in the plan,
having regard to any relevant considerations, including
(i) the nature of the product, including its price and availability,
(ii) the nature of the relevant market for the product,
(iii) the nature of the plan and similar plans, and
(iv) whether the person who operates the plan is a corporation, part-
nership, sole proprietorship or other form of business organization.
(2.1) Idem — A person who operates a multi-level marketing plan shall en-
sure that any representations relating to compensation under the plan that are
made to a prospective participant in the plan by a participant in the plan or by
a representative of the person who operates the plan constitute or include fair,
reasonable and timely disclosure of the information within the knowledge of
the person who operates the plan relating to
(a) compensation actually received by typical participants in the plan; or
156
(b) compensation likely to be received by typical participants in the plan,

having regard to any relevant considerations, including those specified in
paragraph (2)(b).
(2.2) Due diligence defence — A person accused of an offence under sub-
section (2.1) shall not be convicted of the offence if the accused establishes that
Act
he or she took reasonable precautions and exercised due diligence to ensure
(a) that no representations relating to compensation under the plan were
made by participants in the plan or by representatives of the accused; or
(b) that any representations relating to compensation under the plan that
were made by participants in the plan or by representatives of the ac-
cused constituted or included fair, reasonable and timely disclosure of the
information referred to in that subsection.
(2) or (2.1) is guilty of an offence and liable
to imprisonment for a term not exceeding five years or to both; or
1992, c. 14, s. 1; 1999, c. 2, s. 15
Commentary
See commentary for section 55.1.
Case Law
R. v. All Communications Network of Canada Co. (November 26, 2003) (N.S. Prov. Ct.) —
The accused was charged with seven counts under paragraph 55(3)(a) and one count under
sub-section 55.1(3). The marketing scheme principally consisted of sales of long distance
services through sales representatives. In addition to sales to consumers, each new represen-
tative had the option of paying a fee in order to become a “team trainer” and sign up addi-
tional marketing representatives. Only “team trainers” were eligible to earn “customer acqui-
sition bonuses” which accrued when a recruited (or “down-line”) marketing representative in
turn became a “team trainer” and signed up additional customers. With respect to the ques-
tion of whether the marketing scheme constituted a “multi-level marketing plan” under sub-
section 55(1), while the evidence suggested that the accused had failed to satisfy the subsec-
tion 55(2) disclosure requirements, the judge concluded that the receipt of the “team trainer”
fee was not in exchange for the supply of a product — the right to sign-up additional market-
ing representatives and potentially earn certain bonuses did not fit the Act’s section 2 defini-
tion of product (or service). The accused was acquitted on all charges under the Act.
R. v. Charles Press (February 12, 1999) (Alta. Q.B.) — The accused was the principal be-
hind a multi-level marketing company. He was charged personally with several counts under
s. 55(2) for making earnings representations without disclosure of the actual compensation
received or likely to be received by typical participants in the plan. The representations were
made at a public meeting during which specific earnings claims were made without disclo-
sure as required under s. 55(2). On these counts, the accused was found guilty on the basis
that he was the directing mind of the company, and therefore had personal liability in addi-
157
tion to the liability of the company. On other counts relating to occurrences where company
employees made earnings representations in private meetings, the accused was acquitted as
the court was not satisfied that the accused was aware of or in any way directed the
representations.
55.1 (1) Definition of “scheme of pyramid selling” — For the pur-

poses of this section, “scheme of pyramid selling” means a multi-level market-
ing plan whereby
(a) a participant in the plan gives consideration for the right to receive
compensation by reason of the recruitment into the plan of another par-
ticipant in the plan who gives consideration for the same right;
(b) a participant in the plan gives consideration, as a condition of partici-
pating in the plan, for a specified amount of the product, other than a
specified amount of the product that is bought at the seller’s cost price for
the purpose only of facilitating sales;
(c) a person knowingly supplies the product to a participant in the plan in
an amount that is commercially unreasonable; or
(d) a participant in the plan who is supplied with the product
(i) does not have a buy-back guarantee that is exercisable on reasona-
ble commercial terms or a right to return the product in saleable
condition on reasonable commercial terms, or
(ii) is not informed of the existence of the guarantee or right and the
manner in which it can be exercised.
(2) Pyramid selling — No person shall establish, operate, advertise or pro-
mote a scheme of pyramid selling.
(2) is guilty of an offence and liable
to imprisonment for a term not exceeding five years or to both; or
1992, c. 14, s. 1; 1999, c. 2, s. 16
Commentary
The combined effect of ss. 55 and 55.1 is to allow multilevel marketing plans, but then to
prohibit variations of such plans that would have the effect of converting them into pyramid
selling schemes. Prior to 1992, there existed only a s. 55, which defined schemes of pyramid
selling and prohibited that activity.
Case Law
There is limited case law under section 55.1 (see R. v. All Communications Network of Can-
ada Co. in case law for section 55). However, the following cases which were decided under
its predecessor, the former section 55, may be of assistance:
158
R. v. CLP Canmarket Lifestyle Products Corp. (1989), 58 Man. R. (2d) 95 (Q.B.) — That a
member receives for the fee paid not only the right to participate but also other benefits such
as an explanation of the scheme, general advice on participation and price lists does not put
the scheme outside the operation of the statute where payment of the fee is a condition prece-
dent to the right to participate in the scheme.
R. v. CLP Canmarket Lifestyle Products Corp., [1987] 5 W.W.R. 687, 50 Man. R. (2d) 113,
Act
17 C.P.R. (3d) 429 (Q.B.); affirmed [1988] 2 W.W.R. 170, 50 Man. R. (2d) 106, 19 C.P.R.
(3d) 342 (C.A.); leave to appeal to S.C.C. refused [1988] 6 W.W.R. 1xix (note), 88 N.R. 89
(note), 57 Man. R. (2d) 160 (note) (S.C.C.) — Regional disparity in the application of the
law is not itself a violation of s. 15 of the Charter.
R. v. Boivin, 28 C.C.C. (3d) 129, (sub nom. Boivin c. R.) [1986] R.L. 674 (Que. C.A.) — The
accused’s business involved selling membership cards which entitled the holder to receive
discounts from merchants. These cards were sold by agents of the corporation who, to have
this right, had to pay an initial fee, an annual fee, and participate in a training seminar. Each
agent was required to recruit three more agents and to maintain this recruiting unit and he or
she earned commission on sales made by persons in this unit. This scheme constituted a
scheme of pyramid selling within the meaning of this section.
R. v. Shaklee Can. Inc., [1985] 1 F.C. 593, 38 Alta. L.R. (2d) 289, 4 C.P.R. (3d) 433, 59
N.R. 147 (C.A.); reversing [1981] 2 F.C. 730, 55 C.P.R. (2d) 243 (Fed. T.D.); affirmed (sub
nom. Shaklee Can. Inc. v. Canada (A.G.)) [1988] 1 S.C.R. 662, 20 C.P.R. (3d) 192 — Sec-
tion 55(1) [now s. 55.1(1)] clearly indicates the public evil which it addresses, and accord-
ingly is clearly supportable under the criminal law power, being “in truth and in substance”
criminal legislation and not a “colourable invasion of provincial jurisdiction over property
and civil rights.” The Attorney General may either prosecute under s. 36.3(3) [now s. 55(3)]
or request an order of prohibition under s. 30(2) [now s. 34(2)], but may not proceed with
both remedies in accordance with s. 44(4) [now s. 67(5)].
56. [Repealed 1999, c. 2, s. 17.]
57. [Repealed 1999, c. 2, s. 17.]
58. [Repealed 1999, c. 2, s. 17.]
59. [Repealed 1999, c. 2, s. 17.]
60. Defence — Section 54 does not apply to a person who prints or publishes
or otherwise distributes a representation or an advertisement on behalf of an-
other person in Canada if he or she establishes that he or she obtained and
recorded the name and address of that other person and accepted the repre-
sentation or advertisement in good faith for printing, publishing or other dis-
tribution in the ordinary course of his or her business.
1999, c. 2, s. 17.1
Commentary
The defence for printers and publishers is limited to the criminal offence of double ticketing
(s. 54). This defence is not available for the offence of false or misleading representations (s.
52). Pursuant to s. 74.07, this defence is available for reviewable matters such as misrepre-
159
sentations to the public (s. 74.01), representation as to reasonable test and publication of
testimonials (s. 74.02), and representations accompanying products (s. 74.03).
Case Law
R. v. Woolworth Canada Inc. (2000), 3 B.L.R. (3d) 174 (Ont. C.J.) — The accused was al-
leged to have engaged in false advertising in respect of the availability of a particular toy
product in reasonable quantities contrary to s. 52 of the Act. The unexpected magnitude of
the consumer response to the bargain price resulted in the accused having insufficient vol-
ume of the product available. The court concluded that the accused breached s. 52 but found
that the defence of due diligence was made out at common law and at former s. 60(2). The
accused had a rational ordering system in place, and responded to the unforeseen consumer
demand by a prompt reordering of replacement product and undertaking to supply the prod-
uct to all customers who requested it by providing “rainchecks” at the bargain price.
R. v. Suntours Ltd. (1974), 20 C.P.R. (2d) 179, 21 C.C.C. (2d) 239 (Ont. Prov. Ct.) — This
section is meant to apply to a publisher of an advertisement and not to a person who causes it
to be published. Accordingly, it does not provide a defence to a travel agency placing an
advertisement on behalf of a tour company.
R. v. Multitech Warehouse Direct Inc. (1993), 50 C.P.R. (3d) 468, 124 N.S.R. (2d) 378, 345
A.P.R. 378 (T.D.); affirming (1992), 119 N.S.R. (2d) 52, 330 A.P.R. 52 (Prov. Ct.) — In
order to establish a due diligence defence under former s. 60(2) of the Act, it is incumbent
upon the accused to persuade the court that its failure to abide by the law ought to be ex-
cused by proving on a balance of probabilities that all due care was taken. This is neither
easy nor inexpensive, and each case must be decided on its own merits.
R. v. Wholesale Travel Group Inc., [1991] 3 S.C.R. 154, 8 C.R. (4th) 145, 38 C.P.R. (3d)
451, 67 C.C.C. (3d) 193, 84 D.L.R. (4th) 161, 7 C.R.R. (2d) 36, 130 N.R. 1, 49 O.A.C.
161 — Paragraphs (c) and (d) of former s. 60(2) violate s. 7 of the Charter and are of no
force or effect. The reason is that it would be possible for a person who exercised due dili-
gence in conformity with paras. (a) and (b) to still be found guilty in the absence of a timely
retraction. The reverse onus implicit in the requirement that the accused “establish that ...”
was upheld.
R. v. Beam of Canada Inc. (June 27, 1990), Doc. No. CA 31/90 (Ont. C.A.) — There is no
evidence in the record capable of raising a reasonable doubt with respect to the defence of
error and due diligence. Accordingly, the trial judge’s reference to the onus of proof being
on the appellant and the change in the law resulting from R. v. The Wholesale Travel Group
Inc. (1989), 52 C.C.C. (3d) 9 (Ont. C.A.), are of no consequence.
R. v. Giftwares Wholesale Co. (1987), 19 C.P.R. (3d) 75 (Man. Prov. Ct.) — Former s. 60(2)
violates the presumption of innocence guaranteed by s. 11(d) of the Canadian Charter of
Rights and Freedoms in shifting to the accused the burden of proving the four requirements
stated. It also contravenes s. 7 of the Charter. It is accordingly of no force or effect. An
information containing four counts of misleading advertising contrary to s. 52 was accord-
ingly quashed.
An accused charged under s. 52(1) cannot claim as a defence that the representations were
not false and misleading and at the same time claim the defence of due diligence under s. 60.
The Supreme Court of Canada has established that absolute liability offences do not per se
violate s. 7 of the Charter, and hence the less offensive strict liability offences do not do so
either. Thus, even if the combined effect of s. 52(1) and s. 60 is to create a strict liability
offence, this does not invalidate these sections. Parliament does not lack the constitutional
160
jurisdiction to create the offence in the words that it has and to restrict the statutory defence
in the way that it has. [Note: The case as reported refers to s. 37(3) instead of s. 37.3 [now s.
60].]
R. v. Westfair Foods Ltd. (1986), 33 B.L.R. 163, 11 C.P.R. (3d) 345, 41 Man. R. (2d) 205
(Q.B.) — The accused was not aware until charged that an error had allegedly occurred in
one of its advertisements. It was therefore impossible for it to comply with subs. (2)(c) and
Act
(d), but if it did not do so by publishing a retraction a conviction would automatically follow.
This is contrary to the principles of fundamental justice guaranteed by s. 7 of the Canadian
Charter of Rights and Freedoms, Constitution Act, 1982, Pt. I. Furthermore, the effect of
compliance with subs. (2)(c) and (d) is that the accused must admit the actus reus of the
offence. This is a reverse onus which is contrary to the presumption of innocence guaranteed
by s. 11(d) of the Charter. This infringement of Charter rights is not a reasonable limit within
the meaning of s. 1 of the Charter. Subsection (2)(c) and (d) therefore contravenes the Char-
ter and is of no force or effect. Even if subs. (2)(c) and (d) were valid the accused should not
be convicted since through no fault of the accused it was impossible for it to comply with
subs. (2)(c), (d). The accused was unaware of the error, although it had acted with reasonable
care, and the Crown did not notify the accused of the error prior to laying the charge. Once
the charge had been laid the accused could no longer make use of subs. (2)(c) and (d). In
such circumstances the accused should be acquitted.
R. v. Westfair Foods Ltd. (Supervalu), [1985] 3 W.W.R. 423, 5 C.P.R. (3d) 373, 18 C.C.C.
(3d) 178, 38 Sask. R. 12, 16 D.L.R. (4th) 669 (Q.B.) — The accused’s advertisement com-
pared its prices to those of a competitor. Two items were indicated as being not available
because an employee of the accused was told on two occasions by the competitor that they
were out of stock. The accused had thereby met the common law test of due diligence set out
in R. v. Sault Ste. Marie, [1978] 2 S.C.R. 1299, 3 C.R. (3d) 30, 40 C.C.C. (2d) 353, 7
C.E.L.R. 53, 85 D.L.R. (3d) 161, 21 N.R. 295 but in the circumstances it could not meet the
requirements of subs. (2)(c) and (d) of former s. 60. To meet these requirements, that is, to
establish the lack of mens rea, the accused would have had to have admitted the actus reus
of the offence. If it honestly believed there was no actus reus and accordingly did not com-
ply with subs. (2)(c) and (d), but the court found there was an actus reus, no defence would
be available. The offence therefore became one of absolute liability. Given the potential se-
verity of the penalty, this was contrary to the principles of fundamental justice and therefore
contravened s. 7 of the Canadian Charter of Rights and Freedoms, Constitution Act, 1982,
Pt. I.
R. v. Westfair Foods Ltd. (1984), 3 C.P.R. (3d) 174 (Man. Prov. Ct.) — The offence created
by s. 52(1)(a) is one of strict liability. It is not necessary for the Crown to prove the accused
intended to deceive or mislead the public, or that someone was misled by the representation.
If the Crown proves beyond a reasonable doubt that the accused committed the prohibited
act, the onus is on the accused to establish on a balance of probabilities the defence of rea-
sonable care or due diligence under former s. 60(2). To establish this, a company whose
major policy is to advertise on a comparative price basis must establish a defined, consistent
policy and safeguards for doing price checks, which should include double checking.
R. v. Consumers Distributing Co. (1980), 54 C.P.R. (2d) 50, 57 C.C.C (2d) 317 (Ont.
C.A.) — The defence of due diligence created by this section is more stringent than the com-
mon law defence of due diligence set out in R. v. Sault Ste. Marie, [1978] 2 S.C.R. 1299 and
is paramount. In a case of strict liability, such as false and misleading advertising, the burden
is on the accused to establish the defence of due diligence on the balance of probabilities.
The error referred to in subs. (2)(a) of former s. 60 includes not only a clerical slip but also
an honest but mistaken belief. The conduct of the Crown in failing to release an adverse
161
product report did not, however, make it impossible for the accused to issue a retraction of
its false representation, only extremely difficult, and was accordingly no defence under subs.
(2)(c) and (d). It should, however, have been considered in sentencing, a nominal penalty
being appropriate.
R. v. Les Distributeurs Cardinal Ltée (1979), 55 C.P.R. (2d) 155 (Que. S.P.) — The burden
is on the accused to establish a defence under this section once the actus reus has been
established by the Crown. On a charge relating to inaccuracies in a catalogue it is not suffi-
cient to present general evidence concerning the problems in and complexity of designing
and preparing a catalogue. The accused must establish that it took all necessary precautions
to avoid errors such as those with which it is charged, and that once confronted with such
errors it did what a reasonable person would have done to repair the damage.
R. v. Tege Invt. Ltd. (1978), 51 C.P.R. (2d) 216 (Alta. Prov. Ct.) — The accused, who placed
newspaper advertisements for rental property on the basis of information supplied by land-
lords, had not taken reasonable precautions nor exercised due diligence by doing an unspeci-
fied number of spot checks of the accuracy of the information provided every week or two.
Personal inspection of all properties would not, however, be required.
R. v. Bennett Stores Ltd. (1977), 46 C.P.R. (2d) 136 (B.C. Prov. Ct.) — An error appeared in
a newspaper advertisement which was not in the copy provided. The merchant did not learn
of the error until two or three months later, too late to do anything about it. It was neverthe-
less entitled to take advantage of the defence created by this section although no advertise-
ment correcting the error was published.
Giftwares Wholesale Co. v. Rodger, [1977] 4 W.W.R. 326, 32 C.P.R. (2d) 243, (sub nom. R.
v. Giftwares Wholesale Co.) 36 C.C.C. (2d) 330 (Man. Co. Ct.) — An offence under s. 36
[now s. 52] is one of strict liability and mens rea is not a necessary element. A retailer of
gems who was not a gemologist had not, in dealing with reputable manufacturers and ac-
cepting the form of advertising for its catalogue from such a manufacturer, taken reasonable
precautions sufficient to support a defence of due diligence under this subsection. Sen-
tence — A fine of $500 was imposed.
61. [Repealed 2009, c. 2, s. 417.]
62. Civil rights not affected — Except as otherwise provided in this Part,
nothing in this Part shall be construed as depriving any person of any civil
right of action.
Case Law
Can. Cement Lafarge Ltd. v. B.C. Lightweight Aggregate Ltd.; B.C. Lightweight Aggregate
Ltd. v. Can. Cement Lafarge, [1983] 1 S.C.R. 452, [1983] 6 W.W.R. 385, 21 B.L.R. 254, 24
C.C.L.T. 111, 72 C.P.R. (2d) 1, 145 D.L.R. (3d) 385, 47 N.R. 191 — A tort action in con-
spiracy will lie if
(1) there has been concerted conduct in pursuance or execution of the conspiracy, and
(2) the conduct caused actual damage to the plaintiff, and
(3)
(a) whether the means used by the defendants are lawful or unlawful, the predom-
inant purpose of the defendant’s conduct is to cause injury to the plaintiff, or
162
(b) where the conduct of the defendant is unlawful, the conduct is directed to-
wards the plaintiff (alone or together with others), and the defendants should
know in the circumstances that injury is likely to and does result (constructive
intent).
Bell Can. v. Intra Can. Telecommunications Ltd. (1982), 70 C.P.R. (2d) 252 (Fed. C.A.) —
A counterclaim in a civil proceeding stating “that the plaintiffs entered into a conspiracy to
Act
unduly lessen competition in the field of business directories and thereby caused substantial
financial loss to the defendants” does not disclose any reasonable cause of action.
Tank Lining Corp. v. Dunlop Indust. Ltd. (1982), 40 O.R. (2d) 219, 68 C.P.R. (2d) 162, 140
D.L.R. (3d) 659 (C.A.) — In a civil proceeding a covenant in restraint of trade may be found
to be unreasonable with reference to the public interest and therefore void as contrary to
public policy although it would not be likely to invite prosecution under the Act because it
neither reached criminal proportions nor conferred market dominance on the parties.
Valley Salvage Ltd. v. Molson Brewery B.C. Ltd., [1976] 1 W.W.R. 597, 64 D.L.R. (3d) 734,
25 C.P.R. (2d) 37 (B.C. S.C.). (See also entry under s. 45(1).) — It is doubtful whether a
conspiracy to violate the Combines Investigation Act can form the basis of a civil cause of
action.
Philippe Beaubien & Cie Ltée v. Can. Gen. Elec. Co. (1976), 30 C.P.R. (2d) 100 (Que.
S.C.) — A breach of s. 38(3) [now s. 61(3)] might give rise to a civil cause of action.
Direct Lumber Co. v. Western Plywood Co., [1962] S.C.R. 646, 39 W.W.R. 43, 35 D.L.R.
(2d) 1 — The purchaser of goods cannot resist an action for payment on the ground of ille-
gality of the contract by proving a subsequent sale of similar goods to a third party at a lower
price in contravention of the Combines Investigation Act. There is no connection between
the illegality pleaded and the transaction in question.
Philco Prod. Ltd. v. Thermionics Ltd., [1943] S.C.R. 396, 3 Fox Pat. C. 92, 3 C.P.R. 17,
[1943] 3 D.L.R. 499 — That patents may have been assigned as a result of an agreement to
control prices was no defence to an action for infringement of such patents.
Rubenstein v. Kumer, [1940] O.W.N. 153, 73 C.C.C. 303, [1940] 2 D.L.R. 691 (H.C.) —
That an agreement may be illegal because its effect may be to unduly lessen competition is
no grounds for granting a civil injunction.
Gordon v. Imp. Tobacco Sales Co. of Can., [1939] O.R. 122, 71 C.C.C. 322, [1939] 2 D.L.R.
27 (H.C.) — The Act does not confer a civil right of action for damages on a person or
corporation affected by the operation of a combine.
Tpt. Oil Co. v. Imp. Oil Co., [1935] O.R. 215, 63 C.C.C. 108, [1935] 2 D.L.R. 500 (C.A.) —
There is nothing in the Combines Investigation Act, R.S.C. 1927, c. 26, from which an inten-
tion to give a private right of action concerning a combine could be inferred.
Floyd v. Edmonton City Dairy, [1934] 3 W.W.R. 326, 62 C.C.C. 254, [1935] 1 D.L.R. 754
(Alta. S.C.) — A civil action will lie for damage resulting from a criminal conspiracy under
the Criminal Code, R.S.C. 1927, c. 36, s. 498.
Peloquin v. Latraverse (1919), 57 Que. S.C. 379, 33 C.C.C. 165, 54 D.L.R. 181 — An ac-
tion based on quantum meruit for the cost of electrical work was dismissed as the prices
claimed were those fixed by a combination which was illegal under the Criminal Code,
R.S.C. 1906, c. 146, s. 498(1), and accordingly could not be regarded as reasonable prices.
Dom. Supply Co. v. T.L. Robertson Mfg. Co. (1917), 39 O.L.R. 495, 34 D.L.R. 740 (S.C.) —
A contract for the purchase of nails which provided that the nails could be resold only at the
prices fixed by a manufacturers’ association was unenforceable since the price fixing by the
association was contrary to s. 498(1), Criminal Code, R.S.C. 1906, c. 146.
163
Stearns v. Avery (1915), 33 O.L.R. 251, 24 C.C.C. 339 (H.C.) — An injunction to restrain
the defendants from selling at prices other than as stipulated in an agreement between the
parties was refused since the stipulated prices unreasonably enhanced the price to the
purchasing public and were accordingly illegal under s. 498 (1)(c), Criminal Code, R.S.C.
1906, c. 146.
Weidman v. Shragge (1912), 46 S.C.R. 1, 2 W.W.R. 330, 20 C.C.C. 117, 2 D.L.R. 734. (See
also entry under s. 45(1).) — An agreement entered into for the purpose of unduly limiting
competition in the purchase or sale of an article, contrary to s. 498(1), Criminal Code, R.S.C.
1906, c. 146, was unenforceable between the parties.
Wampole & Co. v. F.E. Karn Co. (1906), 11 O.L.R. 619 — In contracts with the plaintiff the
defendant agreed not to sell any of the pharmaceutical products manufactured by the plaintiff
at prices below those fixed by agreements of an association of dealers in pharmaceutical
products. These agreements entirely destroyed competition and prices were thereby unrea-
sonably enhanced, and accordingly were contrary to s. 520 of the Criminal Code, 1892
(Can.), c. 29. The plaintiff’s action for damages for breach of the contracts and for an injunc-
tion was therefore dismissed.
Hately v. Elliott (1905), 9 O.L.R. 185 (C.A.) — An agreement among several importers of a
commodity to fix prices is not sufficient to constitute an offence unless there is evidence that
the parties conspired to prevent competition unduly, especially where there are other import-
ers of the commodity who sell to dealers without imposing any restriction as to the price at
which they should sell to consumers. Since all the importers of coal in a town were members
of an association, the rules of which (i) bound them not to sell coal below the prices fixed by
the association, (ii) fixed the method to be adopted in tendering for supplies of coal to muni-
cipal bodies so as to prevent competition among members, and (iii) provided penalties for
non-observance of the rules, there was sufficient evidence to show that the combination was
of a character which would unduly prevent competition in coal contrary to s. 520(1)(d),
Criminal Code, 1892 (Can.), c. 29. An agreement made to carry out the purposes of the
association was invalid.
PART VII — OTHER OFFENCES (SS. 63–74)

Offences
64. (1) Obstruction — No person shall in any manner impede or prevent or

attempt to impede or prevent any inquiry or examination under this Act.
(2) Offence and punishment — Every person who contravenes subsection
(1) is guilty of an offence and
imprisonment for a term not exceeding two years, or to both.
2009, c. 2, s. 418
164
Part VII — Other Offences (ss. 63–74) S. 65(2)
Commentary
There are no reported cases under ss. 64 or 65 of the Act. In 2006 the Competition Bureau
announced that the Attorney General had laid criminal charges relating to obstruction and
destruction of documents. An individual was “charged under sections 64 and 65 of the Com-
petition Act with obstructing the course of an investigation and destroying documents during
the execution of a search warrant.” The matter did not proceed to trial. The Court of Quebec
Act
granted a non-suit motion brought by the defendant on the charge of destruction and ordered
a stay of proceedings on the charge of obstruction. See Competition Bureau, News Release,
“Obstruction and Destruction of Documents Charges Laid” 11 September 2006 and R. v.
Perreault (Cour du Quebec, Laval) in the Competition Bureau Litigation Status Report
Archive, both of which are available on the Competition Bureau website.
Obstruction charges under the Criminal Code may and have been laid in connection with
Competition Act investigations. In 2004 Morgan Crucible pleaded guilty to obstruction of
justice charges under subs. 139(2) of the Criminal Code for wilfully providing false and
incomplete evidence to Competition Bureau investigators. During the Bureau’s investiga-
tion, former senior executives of Morgan Crucible and some of its subsidiaries were inter-
viewed and falsely denied participating in, or having knowledge of, a conspiracy to fix
prices. The Morgan Crucible Company was fined $550,000 for obstruction and Morgan Cru-
cible’s Canadian affiliate, Morganite Canada Corp., was fined $450,000 for its part in imple-
menting the international conspiracy in Canada. See Competition Bureau, News Release,
“Morgan Companies Fined $1 Million for Obstruction and Price-Fixing” (16 July 2004).
Subsection 139(2) of the Criminal Code provides that “[e]very one who wilfully attempts in
any manner [. . .] to obstruct, pervert or defeat the course of justice is guilty of an indictable
offence and liable to imprisonment for a term not exceeding ten years.” Paragraph 735(1)(a)
of the Code provides that “[a]n organization that is convicted of an offence is liable, in lieu
of any imprisonment that is prescribed as punishment for that offence, to be fined in an
amount, except where otherwise provided by law, [. . .] that is in the discretion of the court,
where the offence is an indictable offence.” Amendments to s. 64 in 2009 increased penalties
for obstruction to mirror those in the Criminal Code. As penalties under s. 64 and ss. 139(2)
are now identical it is unlikely that Criminal Code obstruction charges will be favoured over
s. 64 charges in the future.
65. (1) Contravention of Part II provisions — Every person who, with-

out good and sufficient cause, the proof of which lies on that person, fails to
comply with an order made under section 11 and every person who contra-
venes subsection 15(5) or 16(2) is guilty of an offence and
court or to imprisonment for a term not exceeding two years, or to both;
or
(2) Failure to supply information — Every person who, without good
and sufficient cause, the proof of which lies on that person, contravenes sub-
section 114(1) is guilty of an offence and liable on conviction on indictment or
on summary conviction to a fine not exceeding $50,000.
165
(3) Destruction or alteration of records or things — Every person

who destroys or alters, or causes to be destroyed or altered, any record or
other thing that is required to be produced under section 11 or in respect of
which a warrant is issued under section 15 is guilty of an offence and
(4) Liability of directors — Where a corporation commits an offence under
this section, any officer, director or agent of the corporation who directed, au-
thorized, assented to, acquiesced in or participated in the commission of the
offence is a party to and guilty of the offence and is liable to the punishment
provided for the offence whether or not the corporation has been prosecuted
or convicted.
R.S.C. 1985, c. 19 (2nd Supp.), s. 38; 1999, c. 2, s. 18; 2009, c. 2, s. 419
Commentary
It is a criminal offence under subsection 65(2) to fail to notify the Commissioner of Compe-
tition of a proposed notifiable transaction. Violations are punishable by fines of up to
$50,000.
Reference to “every person” likely refers to every person with a notification obligation in
Part IX (e.g., on a share acquisition the purchaser and the target). However, in the case of
corporations, subsection 65(4) also provides that “any officer, director or agent [. . .] who
directed, authorized, assented to, acquiesced in or participated in the commission of the of-
fence is a party to and guilty of the offence.” This suggests that multiple individuals in addi-
tion to the corporation could be liable to charge and conviction. Further, Criminal Code
charges for offences such as aiding and abetting or counselling are also at least theoretically
possible. In practice, the stigma of a criminal conviction is usually sufficient to deter would-
be violators.
Notably, it is only an offence if the failure to file was done without “good and sufficient
cause.” The phrase has not been judicially considered in the context of the Act but should
give merging parties comfort when making difficult but good-faith assessments as to
whether there is a filing obligation in a particular case. It is difficult to imagine the Competi-
tion Bureau recommending a prosecution, much less securing a conviction, in a tough case
where a reasonable analysis was made. It has also been suggested that the language may give
parties the ability to assert that there ought not to be a sanction where the failure to file was
unintentional. Indeed, as the acquisition of as little as 20% of the voting shares of a public
company can trigger the notification obligation, merger parties occasionally inadvertently
fail to file. (In most cases, this is easily rectified by making a corrective filing.) A more
difficult hypothetical situation might be one in which an informed no-file decision was made
in the face of a conflicting Bureau Interpretation Guideline or informal advice from the Bu-
reau’s Merger Notification Unit.
Although implementing a corporate compliance program is not required under the Competi-
tion Act, the Bureau has accepted the implementation of a compliance program as a remedy
for failure to notify. Parrish and Heimbecker, Limited, an agribusiness company, failed to
notify the Bureau of two proposed acquisitions. The company’s management immediately
166
Part VII — Other Offences (ss. 63–74) S. 65.2(2)
reported the situation once it learned of the failure. In light of management’s voluntary re-
porting and the immediate measures it took, the Bureau was of the view that the company
should adopt a compliance program to ensure it complies with the Act in the future by,
among other things: ensuring that employees are familiar with the Act; appointing two senior
executives as Compliance Officers who will be responsible for the development, implemen-
tation and maintenance of the compliance program; seeking a legal opinion on all proposed
Act
transactions exceeding $5 million in value to determine if they are subject to premerger noti-
fication; and informing the Bureau of the progress being made on the implementation of the
compliance program. See Competition Bureau, News Release, “Competition Bureau takes
steps to ensure Parrish and Heimbecker complies with pre-merger notification obligations”
(29 May 2015).
Prior to amendments in March 2009, subsection 65(2) also made it an offence to consum-
mate a transaction prior to the expiry of the statutory waiting period. That is now a review-
able matter pursuant to section 123.1.
65.1 (1) Contravention of subsection 30.06(5) — Every person who,

without good and sufficient cause, the proof of which lies on that person, con-
travenes subsection 30.06(5) is guilty of an offence and liable on summary con-
viction or on conviction on indictment to a fine not exceeding $5,000 or to im-
prisonment for a term not exceeding two years, or to both.
who destroys or alters, or causes to be destroyed or altered, any record or
thing in respect of which a search warrant is issued under section 30.06 or that
is required to be produced pursuant to an order made under subsection
30.11(1) or 30.16(1) is guilty of an offence and liable
(a) on conviction on indictment to a fine not exceeding $50,000 or to im-
prisonment for a term not exceeding five years, or to both; or
(b) on summary conviction to a fine not exceeding $25,000 or to imprison-
ment for a term not exceeding two years, or to both.
2002, c. 16, s. 7
65.2 (1) Refusal after objection overruled — Every person who, without
good and sufficient cause, the proof of which lies on that person, refuses to
answer a question or to produce a record or thing to the person designated
under paragraph 30.11(2)(c) after a judge has ruled against the objection
under paragraph 30.11(8)(a), is guilty of an offence and liable on conviction on
indictment or on summary conviction to a fine not exceeding $5,000 or to im-
prisonment for a term not exceeding two years, or to both.
(2) Refusal where no ruling made on objection — Every person is
guilty of an offence and liable on summary conviction or on conviction on in-
dictment to a fine not exceeding $5,000 or to imprisonment for a term not
exceeding two years, or to both, who, without good and sufficient cause, the
proof of which lies on that person, refuses to answer a question or to produce a
167
record or thing to the person designated under paragraph 30.11(2)(c), where

no ruling has been made under paragraph 30.11(8)(a),
(a) without giving the detailed statement required by subsection 30.11(9);
or
(b) if the person was previously asked the same question or requested to
produce the same record or thing and refused to do so and the reasons on
which that person based the previous refusal were determined not to be
well-founded by
(i) a judge, if the reasons were based on the Canadian law of non-
disclosure of information or privilege, or
(ii) a court of the foreign state or by a person designated by the for-
eign state, if the reasons were based on a law that applies to the for-
eign state.
2002, c. 16, s. 7
66. Contravention of order under Part VII.1 or VIII — Every person

who contravenes an order made under Part VII.1, except paragraphs
74.1(1)(c) and (d), or under Part VIII, except subsection 79(3.1), is guilty of an
offence and liable
to imprisonment for a term not exceeding five years, or to both; or
Commentary
Section 66 is a strict liability offence that has been described as “extremely serious.” In R. v.
Hovila the court concluded that “willful disobedience of a court order [. . .] should always
attract a significant penalty because it is necessary to impose that type of penalty in order to
maintain the public confidence in judicial oversight of the administration of justice.” In 2012
the Competition Bureau announced that criminal charges had been laid under s. 66 for multi-
ple breaches of a 2010 Consent Agreement with the Bureau that had been entered into to
address concerns that a merger would result in a substantial lessening or prevention of com-
petition. See Competition Bureau, News Release, “Charges Laid Against Waste Services
Company for Breaching Consent Agreement” 11 September 2012, which is available on the
Competition Bureau website. The Public Prosecution Service of Canada subsequently
dropped the charges for procedural reasons, after privileged communications were inadver-
tently included in the Competition Bureau’s investigative files and given to the prosecution
service to be used in the case. See Ron Knox, “Evidence problems end Canada’s case against
Progressive Waste,” Global Competition Review, 17 December 2012. See also Competition
Bureau, News Release, “Alberta Man to Stand Trial for Breach of Consent Agreement” 29
June, 2012.
168
Part VII — Other Offences (ss. 63–74) S. 66.2(1)(b)
Case Law
R. v. Hovila (2014), 112 W.C.B. (2d) 611, 2014 CarswellAlta 393 (A.B.Q.B.) — The ac-
cused owned and operated a job opportunities website which contained false or misleading
representations with respect to employment opportunities in the oil and gas industry. The
offences took place over a period of approximately four years and resulted in website mem-
bership sales of over $300,000. The accused had previously entered into a consent agreement
Act
relating to similar conduct. This agreement was registered with the Competition Tribunal
and had the same force and effect as a court order.
The accused was convicted of three counts of misleading advertising contrary to s. 52 of the
Competition Act, one count of possessing property obtained by crime contrary to s. 354 of
the Criminal Code and one count of contravening a consent order contrary to s. 66 of the
Competition Act.
A total sentence of 30 months of imprisonment was imposed along with a prohibition order
pursuant to s. 34(1) of the Competition Act. The sentence consisted of a term of 15 months of
imprisonment to be served concurrently for each of the 52 offences and a consecutive term
of imprisonment of 15 months for the s. 66 offence. In a separate and unreported decision,
the court imposed a concurrent 12 month term of imprisonment for the proceeds offence.
In arriving at a sentence for the Competition Act offences, the court observed that use of the
Internet has become a multi-billion dollar industry in Canada and that Internet users need to
be protected from fraudulent behaviour. It also found that willful disobedience of a court
order requires a significant penalty in order to maintain public confidence in judicial over-
sight of the administration of justice.
This is the first conviction under s. 66 of the Competition Act. In a related decision [R. v.
Hovila (2014), 110 W.C.B. (2d) 47, 2013 CarswellAlta 2082 (A.B.Q.B.)] the court found
that s. 66 of the Competition Act is a strict liability offence.
66.1 (1) Whistleblowing — Any person who has reasonable grounds to be-
lieve that a person has committed or intends to commit an offence under the
Act, may notify the Commissioner of the particulars of the matter and may
request that his or her identity be kept confidential with respect to the
notification.
(2) Confidentiality — The Commissioner shall keep confidential the identity
of a person who has notified the Commissioner under subsection (1) and to
whom an assurance of confidentiality has been provided by any person who
performs duties or functions in the administration or enforcement of this Act.
1999, c. 2, s. 19
66.2 (1) Prohibition — No employer shall dismiss, suspend, demote, disci-

pline, harass or otherwise disadvantage an employee, or deny an employee a
benefit of employment, by reason that
(a) the employee, acting in good faith and on the basis of reasonable be-
lief, has disclosed to the Commissioner that the employer or any other
person has committed or intends to commit an offence under this Act;
(b) the employee, acting in good faith and on the basis of reasonable be-
lief, has refused or stated an intention of refusing to do anything that is an
offence under this Act;
169
S. 66.2(1)(c) Competition Act
(c) the employee, acting in good faith and on the basis of reasonable belief,
has done or stated an intention of doing anything that is required to be
done in order that an offence not be committed under this Act; or
(d) the employer believes that the employee will do anything referred to in
paragraph (a) or (c) or will refuse to do anything referred to in paragraph
(b).
(2) Saving — Nothing in this section impairs any right of an employee either
at law or under an employment contract or collective agreement.
(3) Definitions — In this section, “employee” includes an independent con-
tractor and “employer” has the corresponding meaning.
1999, c. 2, s. 19
Commentary
Sections 66.1 and 66.2 provide for the protection of the identity of persons
(“whistleblowers”) who report offences under the Act to the Competition Bureau. It is illegal
for employers to take reprisals against employees who make such reports on reasonable be-
lief and in good faith. The Commissioner of Competition will keep confidential the identity
of their sources, and the information provided where an assurance of confidentiality is re-
quested and given to the “whistleblower”.
Procedure
67. (1) Procedure for enforcing punishment — Where an indictment is
found against an accused, other than a corporation, for any offence against
this Act, the accused may elect to be tried without a jury and where he so
elects, he shall be tried by the judge presiding at the court at which the indict-
ment is found, or the judge presiding at any subsequent sittings of that court,
or at any court where the indictment comes on for trial.
(2) Application of Criminal Code — Where an election is made under
subsection (1), the proceedings subsequent to the election shall be regulated in
so far as may be applicable by the provisions of the Criminal Code relating to
the trial of indictable offences by a judge without a jury.
(3) Jurisdiction of courts — No court other than a superior court of crim-
inal jurisdiction, as defined in the Criminal Code, has power to try any offence
under section 45, 46, 47, 48, or 49.
(4) Corporations to be tried without jury — Notwithstanding anything
in the Criminal Code or in any other statute or law, a corporation charged with
an offence under this Act shall be tried without a jury.
(5) Option as to procedure under subsection 34(2) — In any case
where subsection 34(2) is applicable, the Attorney General of Canada or the
attorney general of the province may in his discretion institute proceedings
170
Part VII — Other Offences (ss. 63–74) S. 67
either by way of an information under that subsection or by way of

prosecution.
(6) Limitation period — Proceedings in respect of an offence that is de-
clared by this Act to be punishable on summary conviction may be instituted
at any time within two years but not later than after the time when the sub-
Act
ject-matter of the proceedings arose.
Case Law
Subsection (1)
R. v. Integrity Group (Canada) Inc. (1997), 199 A.R. 234, 73 C.P.R. (3d) 525 (Alta. Prov.
Ct.) — An accused was charged with an information containing 13 counts contrary to s. 55.
The Crown proceeded by way of indictment and the accused elected to be tried by provincial
court judge. The provincial court judge lacked jurisdiction. An information was not an in-
dictment within the meaning of s. 67(1). Sections 67 and 73 of the Act contained a complete
code of trial court jurisdiction, and there was no room to incorporate the Criminal Code
rights of election. Accordingly, the Superior Courts of criminal juridiction had exclusive
jurisdiction to try indictable trade offences.
Subsection (3)
R. v. McLellan Supply Ltd. (1985), 64 A.R. 6 (Prov. Ct.) — As a corporation charged with an
offence under s. 47 may only be tried by a superior court of criminal jurisdiction without a
jury, a provincial court judge prior to or during a preliminary inquiry has no jurisdiction to
decide on an application for a remedy under s. 24(1) of the Charter.
Subsection (4)
R. v. Bogardus, Wilson Ltd. (1982), 2 C.R.R. 110 (B.C. Prov. Ct.) — Section 11(f) of the
Charter of Rights and Freedoms, Constitution Act, 1982, Pt. I, does not give corporations the
right to trial by jury. Corporations are not exposed to risk of imprisonment. Furthermore, the
complexity of a case under the Act renders trial by jury inappropriate.
P.P.G. Indust. Can. Ltd. v. A.G. Can. (1982), 40 B.C.L.R. 299, 67 C.P.R. (2d) 192, 3 C.C.C.
(3d) 97 at 99, 3 C.R.R. 171, 146 D.L.R. (3d) 261 at 263 (S.C.); affirmed (1983), 42 B.C.L.R.
334, 71 C.P.R. (2d) 56, 3 C.C.C. (3d) 97, 4 C.R.R. 193, 146 D.L.R. (3d) 261 (C.A.) — The
denial of the right of a corporation to a trial by jury for an offence under the Act is not
inconsistent with s. 11(f) of the Charter of Rights and Freedoms since in the context of s.
11(f) the word “person” must be taken to mean a natural person. Furthermore, the limitation
on the right to trial by jury is reasonable given the length and complexity of trials under the
Act.
R. v. McGavin Bakeries Ltd., 2 W.W.R. (N.S.) 1, 12 C.R. 123, 100 C.C.C. 195, [1951] 4
D.L.R. 806 (Alta. S.C.) — It is intra vires Parliament, pursuant to its criminal law power
(Constitution Act, 1867, s. 91(27)) to abolish trial by jury in any or all criminal cases. Alter-
natively, the power to abolish juries in cases involving corporations is necessarily incidental
to Parliament’s criminal law power.
R. v. Hobbs Glass Ltd., [1950] O.W.N. 368, 97 C.C.C. 156 (H.C.) — The trial of a corpora-
tion should proceed in exactly the same manner as if the case were being tried with a jury,
but the jurisdiction to decide all questions of law and fact is vested in the presiding judge of
171
the superior court. The omission of the words “by a judge” after the word “tried” does not
deprive the court of jurisdiction to try accused corporations.
Subsection (5)
R. v. Hemlock Park Co-operative Farm Ltd., [1974] S.C.R. 123, 5 C.P.R. (2d) 101, 6 C.C.C.
(2d) 189, 24 D.L.R. (3d) 688 — The definition of “indictment” in the Criminal Code, S.C.
1953–54, c. 51, is inapplicable to the word “information” in ss. 30(2) [now s. 34(2)] and
44(4) [now s. 67(5)]. Although proceedings under s. 30 [now s. 34] are criminal, they are
validly commenced by an information drawn up in accordance with the Exchequer Court
Rules and filed in the Exchequer Court; ss. 30(2) [now s. 34(2)] and 44(4) [now s. 67(5)]
create an exception to the Criminal Code rule that “No criminal information shall be laid or
granted” (s. 488(2), now s. 576(2)).
68. Venue of prosecutions — Notwithstanding any other Act, a prosecu-

tion for an offence under Part VI or section 66 may be brought, in addition to
any place in which the prosecution may be brought by virtue of the Criminal
Code,
(a) where the accused is a corporation, in any territorial division in which
the corporation has its head office or a branch office, whether or not the
branch office is provided for in any Act or instrument relating to the in-
corporation or organization of the corporation; and
(b) where the accused is not a corporation, in any territorial division in
which the accused resides or has a place of business.
1999, c. 2, s. 20
69. (1) Definitions — In this section,

“agent of a participant” means a person who by a record admitted in evidence
under this section appears to be or is otherwise proven to be an officer, agent,
servant, employee or representative of a participant;
“document” [Repealed R.S.C. 1985, c. 19 (2nd Supp.), s. 40(1).]
“participant” means any person against whom proceedings have been insti-
tuted under this Act and in the case of a prosecution means any accused and
any person who, although not accused, is alleged in the charge or indictment to
have been a co-conspirator or otherwise party or privy to the offence charged.
(2) Evidence against a participant — In any proceedings before the Tri-
bunal or in any prosecution or proceedings before a court under or pursuant
to this Act,
(a) anything done, said or agreed on by an agent of a participant shall, in
the absence of evidence to the contrary, be deemed to have been done,
said or agreed on, as the case may be, with the authority of that
participant;
172
(b) a record written or received by an agent of a participant shall, in the

absence of evidence to the contrary, be deemed to have been written or
received, as the case may be, with the authority of that participant; and
(c) a record proved to have been in the possession of a participant or on
premises used or occupied by a participant or in the possession of an
Act
agent of a participant shall be admitted in evidence without further proof
thereof and is prima facie proof
(i) that the participant had knowledge of the record and its contents,
(ii) that anything recorded in or by the record as having been done,
said or agreed on by any participant or by an agent of a participant
was done, said or agreed on as recorded and, where anything is re-
corded in or by the record as having been done, said or agreed on by
an agent of a participant, that it was done, said or agreed on with the
authority of that participant, and
(iii) that the record, where it appears to have been written by any
participant or by an agent of a participant, was so written and,
where it appears to have been written by an agent of a participant,
that it was written with the authority of that participant.
R.S.C. 1985, c. 19 (2nd Supp.), s. 40
Commentary
Section 69 creates an evidentiary presumption that actions taken by agents of a participant or
records written by, received by, or in the possession of an agent of a participant, or in the
possession of a participant, are prima facie attributable to the participant. A participant
means the subject of Competition Act proceedings and, in the case of prosecutions, an ac-
cused or alleged co-conspirator or otherwise party or privy to the offence charged.
Section 69 was originally introduced into the Combines Investigation Act, R.S.C. 1927, c. 26
on 10 December 1949. The purpose of s. 69 is to alleviate the difficulties of proof con-
fronting the Commissioner or Crown in Competition Act proceedings. The presumption ef-
fectively shifts the burden of proof regarding the attribution from the prosecutor to the
defendant.
Paragraphs 69(2)(a) and (b) provide opportunity for the participant to produce evidence to
rebut the presumption that the actions or records of an agent are deemed to have been under-
taken with the authority of the participant.
Paragraph 69(2)(c) does not provide in the statutory provision opportunity for the participant
to rebut the presumption. This paragraph has received different treatment by the courts. One
lower court decision found that the paragraph offends section 11(d) of the Canadian Charter
of Rights and Freedoms and is of no force and effect, unless saved by section 1. Other court
and tribunal decisions, including decisions made after the decision finding paragraph
69(2)(c) to offend section 11(d), have read in an opportunity for the participant to rebut the
presumption or for the court or tribunal to consider the importance of any of the evidence
and not simply convict solely on its basis as being prima facie proof.
The attribution principle of section 69 is similar to that of other statutory provisions in stat-
utes such as the Canadian Business Corporation Act, R.S.C. 1985, c. C-44 and the Criminal
Code, R.S.C. 1985, c. C-46. The reverse onus principle of section 69 is also similar to that of
certain food, agricultural and product regulatory statutes.
173
Section 18 of the Canadian Business Corporation Act prevents a corporation from asserting
that the authority of a corporation agent or document is not actually valid even though it is
represented as valid to the outside world. A corporation may rebut this ostensible authority
presumption by demonstrating that the person whom the corporation is asserting against was
aware of the actual absence of authority.
The Criminal Code was amended in 2004 to add sections 22.1 and 22.2 to attribute criminal
liability to an organization based upon the acts or omissions of its representatives. These
amendments were intended to displace the common law attribution rules that attributed crim-
inal liability based on identification theory. Sections 22.1 and 22.2 significantly broaden the
range of persons by whom criminal liability can be asserted against a corporation than under
identification theory (which was restricted to a corporation’s “directing minds”).
Section 40 of the Canada Agricultural Products Act, R.S.C. 1985, c. 20 (4th Supp.) deems
that certificates and reports created by an analyst, inspector or grader constitute proof of the
matters asserted in the documents, unless there is evidence produced to the contrary. While
the provision is more restricted in the scope of documents covered than that of s. 69, it
similarly reduces the evidentiary burden for the Review Tribunal by requiring the party with
the greater knowledge of the situation to disprove the asserted facts, and it aids the tribunal
in achieving its public purpose, that of ensuring the safety and quality of Canadian agricul-
tural products.
Another example can be found in the Food and Drugs Act, R.S.C. 1985, c. F-27. Section 36
deems, in the absence of evidence to the contrary, that proof that a food or drug package
bore the name or address of manufacturer to be proof that the product was made by that
manufacturer. It is similar to section 69 in that it is incumbent upon the purported manufac-
turer to prove they did not manufacture the product, much like a participant in possession of
a record must prove they did not have knowledge of the record or its contents. The provision
however is restricted to a specific evidentiary item rather than the sweeping coverage of all
records under section 69. It however is in place for the similar reason of aiding the Tribunal
in achieving its purpose of ensuring the safety of Canadian food and drugs by reducing the
difficulty of a prosecution for a contravention of the Act.
Case Law
R. v. Durward, 2014 ONSC 4194 (Ont. S.C.J.) — Section 69(2) breaches the presumption of
innocence guaranteed by ss. 11(d) and 7 of the Charter because it could result in the accused
being convicted without requiring the Crown to establish the guilt of the accused beyond a
reasonable doubt. Section 69(2) presumes that a document or email discovered on a com-
puter located anywhere on the premises of the accused, whether or not it was located on a
computer used by the accused, was known or read by him or her, leaving it to the accused to
prove otherwise.
Eli Lilly & Co. v. Apotex Inc., 2009 FC 991 (F.C.T.D.) — The court was of the view that s.
69(2)(c) of the Act only applies to evidence tendered in the course of a party’s case in chief.
In this case, after Apotex had closed its case in chief, it tried to tender evidence in the course
of its cross-examination of the defendant by counterclaim’s witness.
Canada (Commissioner of Competition) v. Sears Canada Inc., 37 C.P.R. (4th) 65, 2005
Comp. Trib. 2 (Competition Trib.); additional reasons 2005 CarswellNat 7175 (Competition
Trib.) — Section 69 creates a limited, and rebuttable presumption and, in the case of para-
graph 69(2)(c), the reference to prima facie proof speaks to proof absent credible evidence to
the contrary. It is for the Tribunal to interpret a participant’s documents and to determine
what “facts” documents are evidence of and to consider whether those facts, when viewed in
174
the context of the entire body of evidence, establish reviewable conduct. The meaning,
weight and the conclusions to be drawn from any document must be assessed by the Tribu-
nal. Applicable participants’ documents are prima facie proof that the participant said, did
and agreed to the matters set out in the documents.
R. v. Canada Packers Inc. (1988), 19 C.P.R. (3d) 133 (Alta. Q.B.) — Where credible evi-
dence is adduced concerning the issue of authority of an employee, the Crown cannot rely on
Act
s. 45(2)(a) [now 69(2)(a)] but must rely on the common law rules governing the liability of
corporations for the acts of its employees. The court cited an Ontario Court of Appeal dissent
to suggest that for such credible evidence to be sufficient to displace the statutory presump-
tion, such evidence need not satisfy any civil or criminal case burden of proof but that it be
simply enough to blunt the effect of the statute. The common law test for attributing liability
to the corporation for the acts of its employees is that the act in question was done by the
directing force of the company when carrying out his assigned function in the corporation.
This test is based on identification theory.
“Prima facie deemed” as used in s. 69(2)(a) and (b) must mean something different than
“prima facie proof” used in s. 69(2)(c). “Prima facie proof” is a standard of proof at which
the fact is proved sufficiently for conviction if the accused adduces nothing to contradict the
fact or to raise a reasonable doubt. “Prima facie deemed” is a lesser standard, and a convic-
tion need not necessarily follow if the accused stands silent. Because of the large class of
persons who can be participants, all of whom can have one or more agents, and because s.
69(2)(c) establishes a level of proof where a conviction will ensue in the absence of evidence
to the contrary, the section offends s. 11(d) of the Charter (the presumption of innocence)
and is of no force or effect unless saved by s. 1.
R.L. Crain Inc. v. Couture (1983), 10 C.C.C. (3d) 119, 30 Sask. R. 191, 6 D.L.R. (4th) 478
(Q.B) — The prima facie presumptions arising under this section are permissive, not
mandatory, presumptions, and thus do not mean the accused must necessarily be convicted
in the absence of further evidence. As such they are not inconsistent with s. 11(d) of the
Canadian Charter of Rights and Freedoms, Constitution Act, 1982, Pt. I.
Albany Felt Co. of Can. v. R. (1982), 70 C.P.R. (2d) 36, 2 C.C.C. (3d) 129, 143 D.L.R. (3d)
691; leave to appeal to S.C.C. refused (1983), 2 C.C.C. (3d) 129n, 143 D.L.R. (3d) 691n —
The words a “document” used in this section do not denote only a single or particular piece
of paper, but include also several individual documents taken as a whole. Each separate
piece of paper need not record by itself something “as having been done, said or agreed
upon” so long as some of the documents seized, when read together, show that something
was “done, said or agreed upon”.
R. v. Nova Motors Ltd. (1982), 51 N.S.R. (2d) 273, 102 A.P.R. 273 (Co. Ct.) — Knowledge
of the misleading nature of an advertisement is an element of the offence under s. 36(1) [now
s. 52(1)] which must be proven, although the Crown has the assistance of the presumption in
s. 45(2)(a) [now s. 69(2)(a)]. A corporate accused is not pursuant to s. 45(1)(a) [now s.
69(1)(a)] responsible for statements made by an employee in excess of his authority and
contrary to instructions.
R. v. Rolex Watch Co. of Can. Ltd. (1980), 50 C.P.R. (2d) 222, 53 C.C.C. (2d) 445 (Ont.
C.A.) — The trial judge is entitled to interpret documents to determine what facts they are
evidence of and to consider whether they contain internally any evidence to the contrary. His
findings in this regard are findings of fact, not of law, and accordingly cannot be disturbed
on appeal from acquittal by the Crown.
175
R. v. Lethbridge Concrete Prod. Ltd. (1979), 52 C.P.R. (2d) 85, 24 A.R. 335 (T.D.). — A
document admitted into evidence by the operation of this section is prima facie proof that the
person writing it had knowledge of its contents and no more.
R. v. Yukon Auto. Brokers Ltd. (1979), 50 C.P.R. (2d) 81 (Y.T. S.C.) — An accused corpora-
tion who raises a reasonable doubt that a misrepresentation by a salesman was authorized
within the meaning of s. 45(2)(a) [now s. 69(2)(a)] is entitled to acquittal on a charge under
s. 36(1) [now s. 52(1)].
R. v. Can. Gen. Elec. Co. (1976), 15 O.R. (2d) 360, 29 C.P.R. (2d) 1, 34 C.C.C. (2d) 489, 75
D.L.R. (3d) 664 (Ont. H.C.). — The evidentiary effect of this section does not extend to
documents tendered by a defendant and proved to have been in the possession of a partici-
pant or on the premises used or occupied by a participant or in the possession of an agent of
a participant. It was passed to overcome the difficulties of proof that confronted the Crown,
but it was not meant to make prima facie true that which could not be considered true had it
been given by direct evidence. Accordingly, it cannot be used to establish the truth of any
acts or statements in documents admitted under it which are hearsay and not within the per-
sonal knowledge of the agent or participant recording those facts.
R. v. Anthes Business Forms Ltd. (1975), 10 O.R. (2d) 153, 20 C.P.R. (2d) 1, 26 C.C.C. (2d)
349; affirmed [1978] 1 S.C.R. 970, 28 C.P.R. (2d) 33n, 32 C.C.C. (2d) 207n, 22 N.R.
541. — If a corporation is alleged in a charge or indictment to have been a co-conspirator
then any document proved to have been in the possession of that corporation is prima facie
proof that anything recorded in the document as having been done, said or agreed upon by
any other participant was done, said or agreed upon as recorded.
R. v. F.W. Woolworth Co. (1974), 3 O.R. (2d) 629, 16 C.P.R. (2d) 272, 18 C.C.C. (2d) 23, 46
D.L.R. (3d) 345 (C.A.); reversing (1973), 21 C.R.N.S. 371, 11 C.P.R. (2d) 229, 11 C.C.C.
(2d) 572 (H.C.). (See also entry under s. 34.) — The accused permitted H. to demonstrate
and sell pens at a booth in one of its stores. False representations were made by H.’s em-
ployee M. concerning the ordinary selling price of the pens. On appeal by way of stated case
from conviction of the accused, the court found that the accused was not vicariously liable
for the actions of H. and M. since the relationship was either one of lessor and lessee or
licensor and licensee. The accused could not be found guilty as a participant under the Act
unless it could be held to be a party aiding and abetting the offence within the meaning of s.
21 of the Criminal Code, R.S.C. 1970, c. C-34. However, even with respect to offences of
strict liability, the alleged aider must know that he is aiding, that is, have actual knowledge
or be deliberately ignorant, which the accused did not. Furthermore, the alleged aider must
have done or omitted to do something for the purpose of aiding the principal to commit the
offence, not merely have incidently and innocently assisted.
Sunbeam Corp. (Can.) Ltd. v. R., [1969] S.C.R. 221, 56 C.P.R. 242, [1969] 2 C.C.C. 189, 1
D.L.R. (3d) 161 — A prima facie case established by documentary evidence pursuant to this
section does not require the trier of fact to convict. The weight to be attached to such evi-
dence may be considered. A finding by a trial judge in such circumstances that the Crown
has not established guilt beyond a reasonable doubt is a finding of fact which may not be
overturned on appeal since it relates to the sufficiency of evidence.
70. (1) Admissibility of statistics — A collection, compilation, analysis,

abstract or other record or report of statistical information prepared or pub-
lished under the authority of
(a) the Statistics Act, or
176
Part VII — Other Offences (ss. 63–74) S. 72(1)
(b) any other enactment of Parliament or of the legislature of a province,

is admissible in evidence in any proceedings before the Tribunal or in any
prosecution or proceedings before a court under or pursuant to this Act.
(2) Idem — On request from the Minister or the Commissioner
Act
(a) the Chief Statistician of Canada or an officer of any department or
agency of the Government of Canada the functions of which include the
gathering of statistics shall, and
(b) an officer of any department or agency of the government of a prov-
ince the functions of which include the gathering of statistics may,
compile from his or its records a statement of statistics relating to any industry
or sector thereof, in accordance with the terms of the request, and any such
statement is admissible in evidence in any proceedings before the Tribunal or
in any prosecution or proceedings before a court under or pursuant to this
Act.
(3) Privileged information not affected — Nothing in this section com-
pels or authorizes the Chief Statistician of Canada or any officer of a depart-
ment or agency of the Government of Canada to disclose any particulars relat-
ing to an individual or business in a manner that is prohibited by any
provision of an enactment of Parliament or of a provincial legislature designed
for the protection of those particulars.
(4) Certificate — In any proceedings before the Tribunal, or in any prosecu-
tion or proceedings before a court under or pursuant to this Act, a certificate
purporting to be signed by the Chief Statistician of Canada or the officer of
the department or agency of the Government of Canada or of a province
under whose supervision a record, report or statement of statistics referred to
in this section was prepared, setting out that the record, report or statement of
statistics attached thereto was prepared under his supervision, is evidence of
the facts alleged therein without proof of the signature or official character of
the person by whom it purports to be signed.
R.S.C. 1985, c. 19 (2nd Supp.), s. 41; 1999, c. 2, s. 37(u)
71. Statistics collected by sampling methods — A collection, compi-

lation, analysis, abstract or other record or report of statistics collected by
sampling methods by or on behalf of the Commissioner or any other party to
proceedings before the Tribunal, or to a prosecution or proceedings before a
court under or pursuant to this Act, is admissible in evidence in that prosecu-
tion or those proceedings.
R.S.C. 1985, c. 19 (2nd Supp.), s. 42; 1999, c. 2, s. 37(v)
72. (1) Notice — No record, report or statement of statistical information or

statistics referred to in section 70 or 71 shall be received in evidence before the
Tribunal or court unless the person intending to produce the record, report or
statement in evidence has given to the person against whom it is intended to be
177
produced reasonable notice together with a copy of the record, report or state-
ment and, in the case of a record or report of statistics referred to in section
71, together with the names and qualifications of those persons who partici-
pated in the preparation thereof.
(2) Attendance of statistician — Any person against whom a record or
report of statistics referred to in section 70 is produced may require, for the
purposes of cross-examination, the attendance of any person under whose su-
pervision the record or report was prepared.
(3) Idem — Any person against whom a record or report of statistics referred
to in section 71 is produced may require, for the purposes of cross-examina-
tion, the attendance of any person who participated in the preparation of the
record or report.
R.S.C. 1985, c. 19 (2nd Supp.), s. 43
73. (1) Jurisdiction of Federal Court — Subject to this section, the Attor-
ney General of Canada may institute and conduct any prosecution or other
proceedings under section 34, any of sections 45 to 49 or, if the proceedings are
on indictment, under section 52, 52.1, 53, 55, 55.1 or 66, in the Federal Court,
and for the purposes of the prosecution or other proceedings, the Federal
Court has all the powers and jurisdiction of a superior court of criminal juris-
diction under the Criminal Code and under this Act.
(2) No jury — The trial of an offence under Part VI or section 66 in the Fed-
eral Court shall be without a jury.
(3) Appeal — An appeal lies from the Federal Court to the Federal Court of
Appeal and from the Federal Court of Appeal to the Supreme Court of Can-
ada in any prosecution or proceedings under Part VI or section 66 of this Act
as provided in Part XXI of the Criminal Code for appeals from a trial court
and from a court of appeal.
(4) Proceedings optional — Proceedings under subsection 34(2) may in
the discretion of the Attorney General of Canada be instituted in either the
Federal Court or a superior court of criminal jurisdiction in the province but
no prosecution shall be instituted against an individual in the Federal Court in
respect of an offence under Part VI or section 66 without the consent of the
individual.
1999, c. 2, s. 21; 2002, c. 8, ss. 183(1)(f), 198(c)(iii); 2002, c. 16, s. 8; 2009, c. 2, s. 421
Case Law
D & B Co. of Canada v. Canada (Director of Investigation & Research) (1994), 58 C.P.R.
(3d) 342 at 348, (sub nom. Director of Investigation & Research, Competition Act v. D & B
Cos. of Canada) 175 N.R. 312 (Competition Trib.) — The test for an adjournment pending
an appeal is the same as that for a stay of proceedings pending an appeal. When proceedings
were brought by the Director against D. Co., the company unsuccessfully moved for the
Director to disclose documents that were subject to a public interest privilege. D. Co. ap-
178
Part VII.1 — Deceptive Marketing S. 74.01(1)(c)(ii)
pealed the ruling. Its motion to adjourn the proceedings until the appeal had been decided
was dismissed. Although D. Co.’s motion raised a serious issue regarding disclosure, it
would not suffer irreparable harm if the adjournment were denied. There was insufficient
evidence regarding what kind of findings might have been made in the proceedings or how
they might have damaged D. Co. In addition, while the disruption to the proceedings caused
by the appeal decision might have constituted a serious inconvenience, it did not amount to
Act
irreparable harm.
Air Canada v. Canada (Director of Investigation & Research) (1993), 51 C.P.R. (3d) 131
(Competition Trib.); affirmed (1993), 51 C.P.R. (3d) 131 at 142 (F.C.A.) — The Competi-
tion Tribunal issued a decision denying the application by the Director of Investigation and
Research pursuant to s. 106 of the Act to vary a consent order. The Federal Court of Appeal
reversed this decision and returned the matter to the Tribunal for reconsideration. The Tribu-
nal convened a pre-hearing conference to consider the scope of the reconsideration hearing
and its timing, given the pending application for leave to appeal to the Supreme Court of
Canada. It was held that the scope and timing of the hearing were to be discussed accord-
ingly. If leave to appeal were granted by the Supreme Court of Canada, the Tribunal was to
await the results of that appeal before continuing its hearing. An affirmation of the Federal
Court decision by the Supreme Court of Canada would make a further hearing unnecessary.
Insofar as the scope of the reconsideration was concerned, particulars of the remedies re-
quested were to be provided. As the reconsideration was not a new case, new evidence was
not permitted.
74. [Repealed 1999, c. 2, s. 22.]
PART VII.1 — DECEPTIVE MARKETING PRACTICES (SS.

74.01–74.19)
Reviewable Matters
74.01 (1) Misrepresentations to public — A person engages in review-
able conduct who, for the purpose of promoting, directly or indirectly, the sup-
ply or use of a product or for the purpose of promoting, directly or indirectly,
any business interest, by any means whatever,
(a) makes a representation to the public that is false or misleading in a
material respect;
(b) makes a representation to the public in the form of a statement, war-
ranty or guarantee of the performance, efficacy or length of life of a prod-
uct that is not based on an adequate and proper test thereof, the proof of
which lies on the person making the representation; or
(c) makes a representation to the public in a form that purports to be
(i) a warranty or guarantee of a product, or
(ii) a promise to replace, maintain or repair an article or any part
thereof or to repeat or continue a service until it has achieved a speci-
fied result,
179
if the form of purported warranty or guarantee or promise is materially mis-

leading or if there is no reasonable prospect that it will be carried out.
(2) Ordinary price: suppliers generally — Subject to subsection (3), a
person engages in reviewable conduct who, for the purpose of promoting, di-
rectly or indirectly, the supply or use of a product or for the purpose of pro-
moting, directly or indirectly, any business interest, by any means whatever,
makes a representation to the public concerning the price at which a product
or like products have been, are or will be ordinarily supplied where suppliers
generally in the relevant geographic market, having regard to the nature of
the product,
(a) have not sold a substantial volume of the product at that price or a
higher price within a reasonable period of time before or after the making
of the representation, as the case may be; and
(b) have not offered the product at that price or a higher price in good
faith for a substantial period of time recently before or immediately after
the making of the representation, as the case may be.
(3) Ordinary price: supplier’s own — A person engages in reviewable
conduct who, for the purpose of promoting, directly or indirectly, the supply
or use of a product or for the purpose of promoting, directly or indirectly, any
business interest, by any means whatever, makes a representation to the public
as to price that is clearly specified to be the price at which a product or like
products have been, are or will be ordinarily supplied by the person making
the representation where that person, having regard to the nature of the prod-
uct and the relevant geographic market,
(a) has not sold a substantial volume of the product at that price or a
higher price within a reasonable period of time before or after the making
of the representation, as the case may be; and
(b) has not offered the product at that price or a higher price in good faith
for a substantial period of time recently before or immediately after the
making of the representation, as the case may be.
(4) References to time in subsections (2) and (3) — For greater cer-
tainty, whether the period of time to be considered in paragraphs (2)(a) and
(b) and (3)(a) and (b) is before or after the making of the representation de-
pends on whether the representation relates to
(a) the price at which products have been or are supplied; or
(b) the price at which products will be supplied.
(5) Saving — Subsections (2) and (3) do not apply to a person who estab-
lishes that, in the circumstances, a representation as to price is not false or
misleading in a material respect.
(6) [Repealed 2009, c. 2, s. 422.]
1999, c. 2, s. 22; 2009, c. 2, s. 422
180
Part VII.1 — Deceptive Marketing S. 74.01
Commentary
Part VII.1 establishes the civil reviewable practices of misleading advertising and other de-
ceptive marketing practices. Prior to the amendments made in 1999, most of the deceptive
marketing practices set out in Part VII.1 were criminal offences. The conversion of these
criminal offences into reviewable practices did not cause any significant substantive change
to the type of conduct prohibited. As a result, the cases under those former criminal provi-
Act
sions may provide some guidance as to how a court may interpret these civil provisions
today.
For the prosecution of misleading representations and deceptive marketing practices, the
Commissioner of Competition can choose to pursue either the criminal track under section
52 or the civil track set out in Part VII.1. These two tracks are mutually exclusive pursuant to
subsection 52(7) and section 74.16. Once charges have been laid or an application has been
filed with the Tribunal, the Commissioner may not switch regimes. In most instances, the
civil track will be pursued unless the Commissioner is satisfied that the circumstances of the
case warrant criminal prosecution. In making this determination, the Commissioner will con-
sider the criteria outlined in Information Bulletin on Misleading Representations and Decep-
tive Marketing Practices: Choice of Criminal or Civil Track under the Competition Act (Ot-
tawa: Competition Bureau, September 1999).
Subsection (1)
Paragraph (a)
Subsection 74.01(1) governs the reviewable practice of making misleading representations to
the public. Paragraph 74.01(1)(a) establishes the general prohibition against misleading ad-
vertising. It prohibits the making of representations to the public that are false or misleading
in a material respect in order to promote a product, service or business interest. Whether a
representation is “misleading in a material respect” depends on whether or not it will influ-
ence a customer’s buying decision. This includes circumstances where fine print disclaimer
contradicts the main message of the advertisement. For example, see Competition Bureau,
News Release, “Competition Bureau Reaches Agreement with Bell Canada Requiring Bell
to Pay $10 Million for Misleading Advertising” (28 June 2011).
Telecommunications has been a point of focus for the Bureau with respect to false and mis-
leading representations. In 2016, Bell’s subsidiary Bell Mobility Inc. reached a consent
agreement regarding its practice of charging customers for third-party services that the cus-
tomer did not intend to purchase and for which they did not agree to pay, which the Commis-
sioner concluded contravened paragraph 74.01(1)(a). In 2019, the Bureau obtained a para-
graph 11(1)(a) order to advance an ongoing investigation into potentially false and
misleading representations made in connection with the promotion of Bell’s residential In-
ternet and telecommunications services.
Drip-pricing, the practice where advertisers charge consumers fees that are added during the
purchasing process and causing consumers to pay higher prices than advertised, is a common
form of misleading advertising against which the Bureau has taken enforcement action in the
car rental (Aviscar, Budgetcar, Hertz, Dollar Thrifty, Enterprise and Discount Car & Truck
Rentals), ticketing (Ticketmaster and StubHub) and flight booking (FlightHub) industries.
See Competition Bureau, News Release, “Avis and Budget to ensure prices advertised are
accurate” (2 June 2016); Competition Bureau, News Release, “Hertz and Dollar Thrifty to
pay $1.25 million penalty for advertising unattainable prices and discounts” (24 April 2017);
Competition Bureau, News Release, “Enterprise Rent-A-Car Canada to pay a $1 million
penalty for advertising unattainable prices” (22 February 2018); Competition Bureau, News
181
Release, “Discount car rental penalized for advertising unattainable prices” (11 October
2018); Competition Bureau, News Release, “Ticketmaster to pay $4.5 million to settle mis-
leading pricing case” (27 June 2019); Competition Bureau, News Release, “StubHub to pay
$1.3 million penalty for advertising unattainable prices for event tickets” (13 February
2020); and Competition Bureau, News Release, “Competition Bureau takes action on false
or misleading marketing practices in online flight sales” (28 October 2019).
This provision also applies to materially misleading claims for “free” digital services.
Facebook was fined $9 million for making misleading privacy claims about the access, use,
and sharing of Canadian users’ personal information. See Competition Bureau, News Re-
lease, “Facebook to pay $9 million penalty to settle Competition Bureau concerns about
misleading privacy claims” (May 19, 2020).
Paragraph (b)
Paragraph 74.01(1)(b) prohibits the making of representations to the public as to the efficacy
or length of life of a product that is not based on adequate and proper testing. The predeces-
sor of para. 74.01(1)(b) was added to the Criminal Code in 1935, the result of a recommen-
dation made by the Royal Commission on Price Spreads, and became part of the Combines
Investigation Act in 1969. It remained a criminal offence until 1999.
It has been well-established by case law that the determination of whether or not a particular
test is “adequate and proper” will depend on the nature of the claim made and the meaning
or impression conveyed by the claim. It does not necessarily have to be a scientific method
nor do the results need to meet a test of certainty. Courts have generally interpreted “proper”
to mean fit, apt, suitable or as required by the circumstances. Jurisprudence has also consist-
ently held that the adequate and proper tests must be carried out before the representations
are made. See B. (J.D.D.) (Litigation Guardian of) v. G. (J.E.), 1999 CarswellOnt 3204,
[1999] O.J. No. 3748 (Ont. S.C.J.); additional reasons 2000 CarswellOnt 53 (Ont. S.C.J.),
Pandolfo Management Services Ltd. v. Grasslands Feeders Ltd., 1993 CarswellSask 326,
[1993] S.J. No. 189 (Sask. Q.B.), R. v. Batt (1980), 53 C.P.R. (2d) 152 (B.C. Prov. Ct.), R. v.
Kachuk (1973), 12 C.P.R. (2d) 45 (Alta. Prov. Ct.), and R. v. Big Mac Investments Ltd.
(1988), 24 C.P.R. (3d) 39 (Man. Q.B.). A non-exhaustive list of the factors to be considered
in determining whether a test is adequate and proper was set out by the Tribunal in Canada
(Commissioner of Competition) v. Imperial Brush Co., 2008 Comp. Trib. 2, [2008] C.C.T.D.
No. 2 (Competition Trib.), ¶128. See also Competition Bureau, News Release, “Bauer
Ceases Certain RE-AKT Hockey Helmet Performance Claims” (13 November 2014).
Paragraph (c)
Paragraph 74.01(1)(c) prohibits the making of representations to the public in the form of a
warranty, guarantee or promise if the representation is materially misleading or has no rea-
sonable prospect that it will be carried out. To date, there have been no reported decisions
under this provision. The permitting of a representation to be made under subsection 74.01
of the Act is also prohibited.
Subsections (2) and (3)

Subsections 74.01(2) and 74.01(3) prohibit the making of a representation to the public in
respect of the ordinary selling price of a product. The ordinary selling price (OSP) provisions
are intended to prevent illusory bargains (i.e., the false appearance of a sale due to inflated
“regular” prices) by prohibiting the making, or the permitting of the making, of any materi-
182
ally false or misleading representation to the public as to the ordinary selling price of a
product.
The OSP provisions can be relevant in a wide range of circumstances, not merely when a
supplier promotes a product at a price that is a percentage discount off of a “regular” price.
“Buy one get one free” promotions are subject to the OSP provisions, for example. Simi-
larly, offering a “gift” could implicate the OSP provisions, such as offering a “gift” instead
Act
of a “free” product in a “buy one get one free” type of advertisement.
A person, however, will not be subject to penalty under subsections 74.01(2) or 74.01(3) if
he/she can establish that an ordinary selling price representation was not false or misleading
in a material respect based on one of the following tests:
• Volume Test — A substantial volume of the product was sold at that price or a higher
price within a reasonable period of time before or after the making of the
representation.
• Time Test — The product was offered for sale, in good faith, at that price or a higher
price for a substantial period of time recently before or immediately after the making of
the representation.
With respect to the Volume Test, the Bureau has taken the position that a substantial volume
means more than 50% of sales at (or above) the reference price and that a reasonable period
of time means 12 months before (or after) the claim, though this period may be shorter
depending on the nature of the product (e.g., seasonal products).
With respect to the Time Test, the Bureau’s position is that whether a product has been
offered for sale in good faith will depend on a number of factors and that a substantial period
of time means more than 50% of the six months before (or after) the claim is made. As with
the Volume Test, this period may be shorter depending on the nature of the product. In one
case, it was held that a product that had been “on sale” for more than half the applicable
reference period preceding the savings claim had not been offered at its “ordinary” price for
a “substantial period of time” and therefore could not meet the Time Test.
The Bureau pursues ordinary selling price cases once every two to three years and the targets
of enforcement action tend to be large and well-known businesses.
Year Respondent Product Resolution
$60,000 + corrective notice + compliance
Curry’s Art
2009 Art supplies program + 10-year agreement to comply
Store
with OSP provisions
$3.665 million + compliance program +
Frames and
2015 Michaels 10-year agreement to comply with OSP
framing services
provisions
$1.1 million + voluntary compliance
2017 Amazon Blu-Ray movies
practices
$4.5 million + compliance program + 10-
Hudson’s Bay
2019 Sleep sets year agreement to comply with OSP pro-
Company
visions
See Competition Bureau, News Release, “Michaels to pay $3.5 M penalty to settle frames
and custom framing services price advertising case” (6 May 2015); Competition Bureau,
Position Statement “Competition Bureau statement regarding its inquiry into Amazon’s price
advertising in Canada” (11 January 2017); and Competition Bureau, News Release, “Hud-
183
son’s Bay to pay $4.5 million to settle Competition Bureau investigation” (8 May 2019) for
additional detail regarding these cases.
Promotions involving new products appear to fail, by definition, to meet the standard formu-
lation of both the Volume Test and Time Test. That is because there is no track record of
previous sales on which to gauge either test. However, in such cases, the Bureau will typi-
cally assume an inference to future pricing, unless otherwise stated. That means that there
must, at minimum, be a good faith plan to sell an on-sale product at a higher future price and
a good faith belief that the future price can be supported by the market, having regard to
evidence such as market research or experience in other countries in which the product is
sold. The Bureau expectation, therefore, is that where a new product is sold at a promotional
price, it will in the future be sold at a higher price to comply with either the Volume Test or
the Time Test.
Existing Bureau guidelines on OSP create risks for manufacturers that have a limited ability
to control and standardize advertising across retailers. Manufacturers bear ultimate responsi-
bility for the representations they make on their products which will subsequently appear on
retail shelves, unless the manufacturer is outside Canada, in which case the importer is
responsible.
Retailers who display products on their shelves are not liable for representations on labels
and other point-of-sale material designed and produced by the manufacturer of the product
unless the representations were made at the retailer’s specific request, the product was for-
eign manufactured and the retailer was also the importer of the product, or the retailer trans-
forms the manufacturer’s representation into an advertisement of its own (e.g., by advertis-
ing the representation in-store or in a newspaper).
The Bureau clearly takes the view that operators of online marketplace platforms could be
liable for OSP representations made by third-party sellers on their sites. In fact, the Bureau’s
enforcement priority would likely be against platforms, rather than third-party sellers, since
the platforms allow representations to be made and profit though commissions. In such
cases, platforms are unlikely to avoid liability simply by having sellers confirm that they will
abide by the OSP provisions. However, it may be possible for platforms to avoid liability if a
third party contravened the OSP provisions despite robust monitoring and diligence on the
part of the platforms.
Subsection 74.03(4) provides that, in proceedings under section 74.01, it is not necessary to
prove that (a) any person was actually deceived or misled, (b) any member of the public to
whom the representation was made was within Canada, or (c) the representation was made in
a place to which the public had access. The general impression conveyed by a representation,
as well as its literal meaning, is also taken into account in determining whether or not the
person who made the representation engaged in the reviewable conduct.
Case Law
Canada (Commissioner of Competition) v. Chatr Wireless Inc., 2013 ONSC 5315 (Ont.
S.C.J.) — The Commissioner of Competition alleged that Rogers and Chatr had engaged in
false and misleading advertising and that claims they made were not adequately and properly
tested. The two representations at issue were that Chatr had “fewer dropped calls than new
wireless carriers” and that Chatr subscribers would have “no worries about dropped calls.”
Although Rogers’ performance claims about the dropped call rates for its Chatr brand mobile
wireless services were true, Rogers did not exercise due diligence because it did not com-
plete testing in all markets against all competitors prior to making the claims, and was or-
dered to pay an administrative monetary penalty of $500,000. The court modified the stan-
184
dard applied in Richard v. Time under the Quebec Consumer Protection Act and held that the
general impression was to be assessed from the perspective of a “credulous and technically
inexperienced wireless consumer.” The court rejected the Bureau’s argument that advertised
attributes must be discernable to consumers in order for the claim to not be misleading. What
constitutes an “adequate and proper test” requires a flexible and contextual analysis that con-
siders industry practice. Post-claim tests are relevant only to the issue of whether representa-
Act
tions are false and misleading, not to determine the adequacy of initial tests. The court re-
jected Rogers’ constitutional arguments, holding that (i) the infringement of s. 2(b) of the
Charter by s. 74.01(1)(b) is a demonstrably justified reasonable limit prescribed by law, and
(ii) the administrative monetary penalty under s. 74.1(1)(c) does not engage s. 11 of the
Charter.
Ontario (Commissioner of Competition) v. Yellow Page Marketing B.V., 2012 ONSC 927
(Ont. S.C.J.) — The Commissioner alleged that the respondents made materially false or
misleading representations as part of a concerted effort to appear to be related to a well-
known business directory contrary to para. 74.01.(1)(a). The respondents sent unsolicited
materials to existing or potential customers of the business directory that requested certain
details of their information ostensibly to update their existing records and to receive addi-
tional free advertising. In fact, the fine print of the materials stated that a response to the
request would commit the responding party to a two-year contract with the respondents.
Those who responded were sent two annual invoices and other communications related to
collections.
The court rejected the respondents’ claim that the representations contained in the invoices
were not misleading in a material respect because they were made after the decision of sub-
scribers to purchase the respondents’ business directory subscription. The court found that a
representation is misleading in a material respect where an ordinary citizen would likely be
influenced by that impression in deciding whether or not to purchase the product being of-
fered. The court found in this case that the complainants believed they were dealing with the
business directory and would not otherwise have ordered the service nor paid the invoices.
The fine print did not clarify that the respondents were not related to the business directory
and the disclosure regarding the two-year contract was insufficiently prominent.
The court also rejected the respondents’ claim that the representations in the invoices and
other collections communications were not made for the purpose of promoting business in-
terests but rather for the purpose of collecting accounts on business already acquired. The
court found that the phrase “business interest” must be given a wide meaning and collecting
money, and threats made in relation to collection efforts, constitute promotion of the respon-
dents’ business interests.
This was the first decision in a contested proceeding since the penalty regime was amended
in 2009. In addition to declaratory and restitutionary relief and a 10-year prohibition order,
the court issued the highest administrative penalty to date in contested deceptive marketing
proceeding. In determining the administrative penalty, the court identified as aggravating
factors the respondents’ continued engagement in misleading conduct in Canada through
another corporate entity in breach of an earlier injunction order and their similar conduct in
foreign jurisdictions, the materiality of the false or leading representations and the substan-
tial gross revenue of the respondents’ scheme. The court issued an $8 million administrative
penalty against the respondent corporations, $500,000 against the two individual respondents
who were the primary principals of the scheme and $35,000 against the individual respon-
dent who was less involved in the scheme and who received modest remuneration.
185
The Court rejected the respondents’ claim to a due diligence defence based on their genuine
belief that the trademarks were generic. The court found that the exercise of “due diligence”
in s. 74.1(3) is “to prevent the reviewable conduct from occurring”.
Canada (Commissioner of Competition) v. Premier Career Management Group Corp., 2009
FCA 295 (Fed. C.A.); reversing 2008 Comp. Trib. 18 (Competition Trib.) — The Commis-
sioner alleged that the respondent, an employment consulting business, made a number of
misleading representations contrary to para. 74.01(1)(a). The Tribunal held that, although the
representations were misleading, they were not made “to the public” because they were
made in the privacy of the respondents’ office on a one-to-one basis. The Tribunal’s decision
was overturned on appeal. The Federal Court of Appeal found that the representations were
made to members of the public who had been invited by advertisements to seek the respon-
dents’ services. Furthermore, the representations were not made to only one person; rather,
similar representations were made to a significant portion of the public. In these circum-
stances, the representations were held to be made “to the public”.
Canada (Commissioner of Competition) v. Imperial Brush Co., 2008 Comp. Trib. 2 (Compe-
tition Trib.) — The Commissioner brought an application alleging that the respondents failed
to perform proper and adequate tests before making representations to the public as to the
performance of its fireplace maintenance products and therefore had engaged in reviewable
conduct under to s. 74.01(1)(b). The respondents submitted that s. 74.01(1)(b) infringed their
right to freedom of expression under s. 2(b) of the Charter of Rights and Freedoms. The
Commissioner conceded that the section breached s. 2(b) of the Charter but put forward a s.
1 justification defence. The Tribunal accepted that s. 74.01 violates s. 2(b) of the Charter,
but that the violation is justified under s. 1. The objective of s. 74.01(1)(b) is to protect
consumers from representations based on inadequate or improper tests and such an objective
cannot be achieved through other means. In determining whether the respondents’ test was
“adequate and proper”, the Tribunal stated that the factors to consider will differ on a case by
case basis. In this case, the Tribunal considered the following factors and applied them on a
strict basis because the product is used in connection with dangerous chimney fires: how the
representation is understood by the common person; whether it reflects the risk or harm
which the product is designed to prevent or assist in preventing; whether the test was done
under controlled circumstances or in conditions which exclude or take into account external
variables; whether the test was conducted on more than one independent sample; whether the
results are reasonable given the nature of the harm at issue and establish that it is the product
itself which causes the desired effect, and whether a test has been performed regardless of
the size of the seller’s organization or the anticipated volume sales. The Tribunal held that
the respondents’ test did not meet the “adequate and proper” standard and accordingly or-
dered remedies pursuant to s. 74.1.
(Competition Trib.) — The Commissioner alleged that, during three sales events, the retailer
employed deceptive marketing practices in respect of price representations concerning dis-
counts for the purchase of single or multiple units of automobile tires. During half of the six-
month period preceding the representations, the retailer had offered the tires for sale at the
regular price for a substantial period of time. The retailer raised a constitutional issue, sub-
mitting that subs. 74.01(3) of the Act was contrary to s. 2 of the Charter of Rights and
Freedoms, which protects freedom of expression, and could not be saved under s. 1, as it was
too vague to be “prescribed by law” and was disproportionate. The Tribunal rejected those
arguments, and although the provision did infringe freedom of expression under s. 2, the
objectives of the legislation were of sufficient importance to justify the limitation on materi-
ally false or misleading price representations. On the merits of the case, the Tribunal found
186
that the retailer had not complied with either the volume test or the time test which serve to
determine whether a person has engaged in reviewable conduct in regards to the ordinary
selling price, and had failed to establish that its representations on the ordinary selling price
were not false or misleading in a material way. As a result, the Tribunal issued a prohibition
order, applicable to tires and other automotive products and services, directing the retailer
not to engage in conduct contrary to subs. 74.01(3) of the Act for a period of ten years.
Act
Canada (Commissioner of Competition) v. P.V.I. International Inc. (2004), 31 C.P.R. (4th)
331 (F.C.A.); varying (2002), 19 R.P.R. (4th) 129 (Competition Trib.) — The Commissioner
of Competition brought an application alleging that the respondents had made misrepresenta-
tions to the public for the purposes of promoting a product and misrepresentations as to the
performance of a product not based upon adequate and proper tests. The Commissioner sub-
mitted that these misrepresentations constituted reviewable conduct contrary to s. 74.01 of
the Act. The respondents were marketing and selling a product which they claimed would
increase gas or diesel mileage, and would reduce exhaust emissions. The Commissioner suc-
cessfully applied for an order of the Competition Tribunal requiring the respondents to pay
an administrative penalty with respect to the gasoline product, and prohibiting the respon-
dents from making representations to the public which were contrary to Part VII.1 of the
Act. Although a U.S. court decision dismissed the U.S. government claims of false advertis-
ing for the same product, the U.S. decisions were not binding on the Tribunal, and involved
different evidence being presented. The respondents’ advertising gave the impression that
the U.S. government had approved the product, and confirmed its capacity to increase fuel
efficiency by paraphrasing the U.S. District Court decision in a false and misleading manner.
In view of the U.S. court decision, however, it was not appropriate to award the maximum
administrative monetary penalty.
The respondents appealed against the Tribunal’s order with respect to the gasoline product.
The Commissioner cross-appealed on the basis that the Tribunal erred in law by declining to
order the respondents to issue a notice correcting the misrepresentations, and by declining to
issue an administrative penalty with respect to the diesel product. The appeal was dismissed,
and the cross-appeal was allowed in part only to the extent of correcting the reasoning of the
Tribunal. With respect to the respondent’s appeal, the Tribunal had not made any reviewable
error, nor breached its duty of fairness. With respect to the cross-appeal, if the Tribunal took
judicial notice of U.S. regulatory practice as a basis not to order the respondents to issue a
corrective notice, the Tribunal should have so indicated, and given the parties an opportunity
to respond. However, the Tribunal gave another reason for refusing the corrective notice, and
that was the reliance on a U.S. District Court decision, which found that misrepresentations
about the respondents’ product was not substantiated.
Section 74.1 did not require the kind of detail in a corrective notice apparently contemplated
by the Tribunal. The Tribunal, by taking into account an irrelevant consideration, erred in
law in the exercise of its discretion. However, with the lapse of time between the respon-
dents’ last false or misleading representations, and the Commissioner’s acknowledgment that
its primary concern related to the precedential nature of the Tribunal’s ruling, remitting the
matter back to the Tribunal for reconsideration would have little practical value. Even as-
suming that the respondents’ undertaking not to repeat the misrepresentations was an irrele-
vant consideration, the appellate court was not prepared to infer from the Tribunal’s reasons
that the Tribunal did not exercise its discretion not to impose an administrative penalty re-
specting the diesel product on a more holistic view of the facts of the case than the Commis-
sioner suggested.
187
74.011 (1) False or misleading representation — sender or subject

matter information — A person engages in reviewable conduct who, for the
purpose of promoting, directly or indirectly, any business interest or the sup-
ply or use of a product, sends or causes to be sent a false or misleading repre-
sentation in the sender information or subject matter information of an elec-
tronic message.
(2) False or misleading representation — electronic message — A
person engages in reviewable conduct who, for the purpose of promoting, di-
rectly or indirectly, any business interest or the supply or use of a product,
sends or causes to be sent in an electronic message a representation that is
false or misleading in a material respect.
(3) False or misleading representation — locator — A person en-
gages in reviewable conduct who, for the purpose of promoting, directly or
indirectly, any business interest or the supply or use of a product, makes or
causes to be made a false or misleading representation in a locator.
(4) General impression to be considered — In proceedings under this
section, the general impression conveyed by a representation as well as its lit-
eral meaning shall be taken into account in determining whether or not the
person who made the representation engaged in the reviewable conduct.
(5) Interpretation — For the purposes of this section,
(a) an electronic message is considered to have been sent once its trans-
mission has been initiated; and
(b) it is immaterial whether the electronic address to which an electronic
message is sent exists or whether an electronic message reaches its in-
tended destination.
2010, c. 23, s. 77
Commentary
These provisions apply to false, misleading or deceptive information in electronic messages.
Specifically, they cover sender information, subject matter information and the locator of
electronic messages (e.g., text, sound, voice or image messages). Conduct may contravene
these provisions even if the electronic message is not delivered to its intended recipient or is
sent to an electronic address that does not exist.
74.012 (1) Assisting foreign states — The Commissioner may, for the
purpose of assisting an investigation or proceeding in respect of the laws of a
foreign state, an international organization of states or an international organ-
ization established by the governments of states that address conduct that is
substantially similar to conduct that is reviewable under section 74.01, 74.011,
74.02, 74.04, 74.05 or 74.06,
(a) conduct any investigation that the Commissioner considers necessary
to collect relevant information, using any powers that the Commissioner
188
may use under this Act to investigate conduct that is reviewable under
any of those sections; and
(b) disclose the information to the government of the foreign state or to
the international organization, or to any institution of any such govern-
ment or organization responsible for conducting investigations or initiat-
Act
ing proceedings in respect of the laws in respect of which the assistance is
being provided, if the government, organization or institution declares in
writing that
(i) the use of the information will be restricted to purposes relevant
to the investigation or proceeding, and
(ii) the information will be treated in a confidential manner and, ex-
cept for the purposes mentioned in subparagraph (i), will not be fur-
ther disclosed without the Commissioner’s express consent.
(2) Limitation — Subsection (1) does not apply if the contravention of the
laws of the foreign state has consequences that would be considered penal
under Canadian law.
(3) Mutual assistance — In deciding whether to provide assistance under
subsection (1), the Commissioner shall consider whether the government, or-
ganization or institution agrees to provide assistance for investigations or pro-
ceedings in respect of any of the sections mentioned in subsection (1).
2010, c. 23, s. 77
74.02 Representation as to reasonable test and publication of tes-

timonials — A person engages in reviewable conduct who, for the purpose of
promoting, directly or indirectly, the supply or use of any product, or for the
purpose of promoting, directly or indirectly, any business interest, makes a
representation to the public that a test has been made as to the performance,
efficacy or length of life of a product by any person, or publishes a testimonial
with respect to a product, unless the person making the representation or pub-
lishing the testimonial can establish that
(a) such a representation or testimonial was previously made or published
by the person by whom the test was made or the testimonial was given, or
(b) such a representation or testimonial was, before being made or pub-
lished, approved and permission to make or publish it was given in writ-
ing by the person by whom the test was made or the testimonial was
given,
and the representation or testimonial accords with the representation or testi-
monial previously made, published or approved.
1999, c. 2, s. 22
189
74.03 (1) Representations accompanying products — For the pur-

poses of sections 74.01 and 74.02, a representation that is
(a) expressed on an article offered or displayed for sale or its wrapper or
container,
(b) expressed on anything attached to, inserted in or accompanying an
article offered or displayed for sale, its wrapper or container, or anything
on which the article is mounted for display or sale,
(c) expressed on an in-store or other point-of-purchase display,
(d) made in the course of in-store or door-to-door selling to a person as
ultimate user, or by communicating orally by any means of telecommuni-
cation to a person as ultimate user, or
(e) contained in or on anything that is sold, sent, delivered, transmitted or
made available in any other manner to a member of the public,
is deemed to be made to the public by and only by the person who causes the
representation to be so expressed, made or contained, subject to subsection (2).
(2) Representations from outside Canada — Where a person referred
to in subsection (1) is outside Canada, a representation described in paragraph
(1)(a), (b), (c) or (e) is, for the purposes of sections 74.01 and 74.02, deemed to
be made to the public by the person who imports into Canada the article, thing
or display referred to in that paragraph.
(3) Deemed representation to public — Subject to subsection (1), a per-
son who, for the purpose of promoting, directly or indirectly, the supply or use
of a product or any business interest, supplies to a wholesaler, retailer or other
distributor of a product any material or thing that contains a representation of
a nature referred to in section 74.01 is deemed to make that representation to
the public.
(4) Certain matters need not be established — For greater certainty,
in proceedings under sections 74.01 and 74.02, it is not necessary to establish
that
(a) any person was deceived or misled;
(b) any member of the public to whom the representation was made was
within Canada; or
(c) the representation was made in a place to which the public had access.
(5) General impression to be considered — In proceedings under sec-
tions 74.01 and 74.02, the general impression conveyed by a representation as
well as its literal meaning shall be taken into account in determining whether
or not the person who made the representation engaged in the reviewable
conduct.
1999, c. 2, s. 22; 2009, c. 2, s. 423; 2010, c. 23, s. 78; 2014, c. 31, s. 35
190
Commentary
Subsection 74.03(5) requires that the general impression of a representation, as well as its
literal meaning, be taken into account. Prior to adopting the “general impression” test, Parlia-
ment considered incorporating a “credulous man” test in the misleading advertising provi-
sions of the Combines Investigation Act. This language was subsequently abandoned due to
negative public reaction and was replaced by the current “general impression” test. However,
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courts continue to apply a “credulous” consumer standard to determine the general impres-
sion conveyed by an advertisement.
In Richard v. Time Inc., a case alleging prohibited business practices contrary to Quebec’s
Consumer Protection Act, RSQ c P-40.1, the Supreme Court of Canada concluded that the
general impression test should be assessed from the perspective of the credulous and inexpe-
rienced consumer. In Canada (Competition Bureau) v. Chatr Wireless Inc., the Ontario Su-
perior Court of Justice adapted that test for application to subsection 74.03(5) Competition
Act.
Cases
Vidéotron, s.e.n.c. c. Bell Canada, 2015 QCCS 1663 (C.S. Que.) — The court dismissed the
motion for an interlocutory injunction that would have required Bell Canada to remove ad-
vertisements promoting its new optic fiber services. Videotron considered the advertisements
to be false and misleading because they indicated that Bell’s fiber optic service is offered
throughout Quebec when, in reality, Bell was not able to provide services to the majority of
the target market. Videotron accused Bell of adopting a “bait and switch” approach to at-
tracting new customers. The court concluded that Bell’s advertisements were not conveying
the general impression that Bell was offering its services to all customers because it had
specifically advertised that its services were available only where access and technology
permit.
Canada (Competition Bureau) v. Chatr Wireless Inc., 2013 ONSC 5315 (Ont. S.C.J.) — The
credulous and inexperienced consumer standard set out in Richard v. Time Inc. is the starting
point for determining the proper consumer perspective for the purposes of subsection
74.03(5). However, the difference in purpose between Québec’s Consumer Protection Act,
under consideration in Richard v. Time Inc., and the Competition Act is a relevant considera-
tion in determining the proper consumer perspective to be applied to the contentious repre-
sentations under the Competition Act. The Québec act is intended to protect vulnerable per-
sons from the dangers of certain advertising techniques. The Competition Act is intended to
maintain and encourage competition in Canada in order to “provide consumers with compet-
itive prices and product choices.” In the present case, the requirement that the consumer be
inexperienced in is difficult to apply. The consumer by definition resides in a segment of the
wireless services market that wants unlimited talking and texting wireless services. Such a
consumer cannot be viewed as inexperienced with wireless talking and texting, otherwise the
consumer would not reside in a segment of the wireless services market. Accordingly, the
lack of experience relates to the technical information contained in the advertisements. It is
this aspect of the claim with which the consumer lacks experience. The consumer perspec-
tive in this case is that of a credulous and technically inexperienced consumer of wireless
services.
Richard v. Time Inc., 2012 SCC 8, [2012] 1 S.C.R. 265 (S.C.C.) — The Supreme Court
considered the meaning of the “general impression” test found in s. 218 of the Quebec Con-
sumer Protection Act, which is largely based upon subs. 52(4) of the Competition Act, which
itself is identical to subs. 74.03(5). In the case of false or misleading advertising, the general
191
impression is the one a person has after an initial contact with the entire advertisement, and it
relates to both the layout of the advertisement and the meaning of the words used. It is
analysed without considering the personal attributes of the consumer who has instituted pro-
ceedings against the merchant. To be consistent with the legislature’s objective of protecting
vulnerable persons from the dangers of certain advertising techniques, the general impres-
sion test must be applied from the perspective of the average consumer, who is credulous
and inexperienced and takes no more than ordinary care to observe that which is staring him
or her in the face upon first entering into contact with an entire advertisement.
74.04 (1) Definition of “bargain price” — For the purposes of this sec-
tion, “bargain price” means
(a) a price that is represented in an advertisement to be a bargain price
by reference to an ordinary price or otherwise; or
(b) a price that a person who reads, hears or sees the advertisement would
reasonably understand to be a bargain price by reason of the prices at
which the product advertised or like products are ordinarily supplied.
(2) Bait and switch selling — A person engages in reviewable conduct
who advertises at a bargain price a product that the person does not supply in
reasonable quantities having regard to the nature of the market in which the
person carries on business, the nature and size of the person’s business and the
nature of the advertisement.
(3) Saving — Subsection (2) does not apply to a person who establishes that
(a) the person took reasonable steps to obtain in adequate time a quantity
of the product that would have been reasonable having regard to the na-
ture of the advertisement, but was unable to obtain such a quantity by
reason of events beyond the person’s control that could not reasonably
have been anticipated;
(b) the person obtained a quantity of the product that was reasonable
having regard to the nature of the advertisement, but was unable to meet
the demand therefor because that demand surpassed the person’s reason-
able expectations; or
(c) after becoming unable to supply the product in accordance with the
advertisement, the person undertook to supply the same product or an
equivalent product of equal or better quality at the bargain price and
within a reasonable time to all persons who requested the product and
who were not supplied with it during the time when the bargain price
applied, and the person fulfilled the undertaking.
1999, c. 2, s. 22
Commentary
The former criminal offence of bait and switch selling previously contained in section 57 is
now reviewable conduct under Part VII.1.
Section 74.04 applies to products advertised at a “bargain price” that are not available for
sale in reasonable quantities. This provision does not apply if: (i) the quantity of the product
192
obtained was reasonable; (ii) the non-availability of the product was due to circumstances
beyond the advertiser’s control; or (iii) the supplier undertook to provide the customer with
the product at issue (or an equivalent product) when supplies were exhausted and the exhaus-
tion was due to bona fide non-availability (and not a systematic practice of advertising at
bargain prices with no genuine effort to provide reasonable quantities at that price). “Reason-
able quantities” are determined on a case-by-case basis, but are generally based on historical
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consumer demand for the same or comparable products during previous sales using similar
advertisements.
74.05 (1) Sale above advertised price — A person engages in reviewable

conduct who advertises a product for sale or rent in a market and, during the
period and in the market to which the advertisement relates, supplies the
product at a price that is higher than the price advertised.
(2) Saving — This section does not apply
(a) in respect of an advertisement that appears in a catalogue in which it
is prominently stated that the prices contained in it are subject to error if
the person establishes that the price advertised is in error;
(b) in respect of an advertisement that is immediately followed by another
advertisement correcting the price mentioned in the first advertisement;
(c) in respect of the supply of a security obtained on the open market dur-
ing a period when the prospectus relating to that security is still current;
or
(d) in respect of the supply of a product by or on behalf of a person who is
not engaged in the business of dealing in that product.
(3) Application — For the purpose of this section, the market to which an
advertisement relates is the market that the advertisement could reasonably
be expected to reach, unless the advertisement defines the market more nar-
rowly by reference to a geographical area, store, department of a store, sale by
catalogue or otherwise.
1999, c. 2, s. 22
Commentary
The former criminal offence of sale above advertised price previously contained in section
58 is now reviewable conduct under Part VII.1.
Section 74.05 prohibits selling or renting a product at a price higher than its advertised price
unless an exemption listed in s. 74.05(2) applies. The provision is limited to advertisements
of a product for sale or rent. Therefore, it will likely not apply to representations in other
forms, such as oral statements and most labels.
74.06 Promotional contests — A person engages in reviewable conduct

who, for the purpose of promoting, directly or indirectly, the supply or use of a
product, or for the purpose of promoting, directly or indirectly, any business
interest, conducts any contest, lottery, game of chance or skill, or mixed
193
chance and skill, or otherwise disposes of any product or other benefit by any
mode of chance, skill or mixed chance and skill whatever, where
(a) adequate and fair disclosure is not made of the number and approxi-
mate value of the prizes, of the area or areas to which they relate and of
any fact within the knowledge of the person that affects materially the
chances of winning;
(b) distribution of the prizes is unduly delayed; or
(c) selection of participants or distribution of prizes is not made on the
basis of skill or on a random basis in any area to which prizes have been
allocated.
1999, c. 2, s. 22
Commentary
The former criminal offence of promotional contests previously contained in section 59 is
now reviewable conduct under Part VII.1.
Section 74.06 is one element of the Canadian regulatory regime on promotional contests,
supplemented by the general misleading advertising provisions of the Competition Act, ss.
206 and 207 of the Criminal Code and the common law. Further, specific provisions in the
Competition Act deal with contests in the contest of telemarketing (s. 52.1) and prize notices
(s. 53). A separate regulatory regime applies to contests in Quebec. The Bureau outlines its
approach to s. 74.06 in its Promotional Contests Enforcement Guidelines.
Contest organizers may provide “short rules” at the point of purchase, which typically in-
cludes disclosure of the value, number and allocation of prizes, any skill-testing require-
ments, odds of winning and the closing date of the contest. In such circumstances, the full
version of the contest rules should be made available on the contest organizer’s website or
upon request.
In 2009, the Bureau fined a Manitoba-based resort company $170,000 for running mislead-
ing promotional contests. The Bureau found that the resort company, which sells time shares
for vacation properties, ran contests without fair disclosure of accurate odds of winning and
without ensuring that winners were selected on a random basis. The company’s contests also
gave the misleading impression that the grand prize was a brand new SUV, when the prize, if
awarded, was a one or two year lease on an SUV, with stringent conditions. See Competition
Bureau, News Release, “Resort Company Penalized for Running Misleading Contests” (23
November 2009).
Case Law
R. v. Simpsons Ltd. (1988), 25 C.P.R. (3d) 34 (Ont. Dist. Ct.) — The accused distributed
over one million one-day discount cards, each containing four tabs hiding the discount per-
cent, representing that the holder could save from 10% to 25% on almost everything in the
store. Ninety percent of the cards had a discount figure of 10% under each of the four tabs.
The representation was false or misleading in a material respect in that it gave the impression
that a different percentage appeared under each tab. The promotion was not a contest, lottery
or game within the meaning of s. 59 [now s. 74.06] but it did dispose of a benefit — a
discount — by a mode of chance and accordingly fell within that section. As the accused had
failed to disclose the limited odds of winning a discount greater than 10%, it was guilty of an
offence under this section. However, since the essential offence alleged on all three counts
194
Part VII.1 — Deceptive Marketing S. 74.1(1)
was the failure to disclose the odds, only one conviction would be entered and the other two
stayed conditionally pending disposition of any appeal or expiration of the time for appeal.
Sections 52(1)(a) and 59 in combination do not create an absolute liability offence but rather
create a strict liability offence and thus do not offend ss. 7 or 11(d) of the Charter.
R. v. Pepsi Cola Can. Ltd. (1986), 14 C.P.R. (3d) 399 (Ont. Prov. Ct.) — Sentence — The
accused pleaded guilty to an offence under this section. The rules of a contest provided that
Act
the participating radio station would draw 150 entries from eligible entries received from
which 1 winner would be drawn. Three hundred entries were in fact drawn. The decision to
draw 300 was not made with the consent or knowledge of the head office of the accused.
Only one customer complaint was received. Nevertheless, wide acceptance of such contests
requires that the advertised odds be adhered to. A fine of $2,000 was imposed.
74.07 (1) Saving — Sections 74.01 to 74.06 do not apply to a person who
prints or publishes or otherwise disseminates a representation, including an
advertisement, on behalf of another person in Canada, where the person es-
tablishes that the person obtained and recorded the name and address of that
other person and accepted the representation in good faith for printing, pub-
lishing or other dissemination in the ordinary course of that person’s business.
(2) Non-application — Sections 74.01 to 74.06 do not apply in respect of
conduct prohibited by sections 52.1, 53, 55 and 55.1.
1999, c. 2, s. 22; 2002, c. 16, s. 9
Commentary
The defence for printers and publishers, formerly set out in subsection 60(1) [now s. 60] in
relation to criminal offences, is now also available for administrative proceedings under Part
VII.1. It provides for exemption from liability for deceptive marketing where a person prints
or publishes or otherwise disseminates a representation on behalf of another person. This
exemption applies where the printer or publisher has obtained and recorded the name and
address of the other person, and accepted the representation in good faith for printing, pub-
lishing or other dissemination in the ordinary course of that person’s business.
74.08 Civil rights not affected — Except as otherwise provided in this

Part, nothing in this Part shall be construed as depriving any person of a civil
right of action.
1999, c. 2, s. 22
Administrative Remedies
74.09 Definition of “court” — In sections 74.1 to 74.14 and 74.18, “court”
means the Tribunal, the Federal Court or the superior court of a province.
1999, c. 2, s. 22; 2002, c. 8, s. 183(1)(f)
74.1 (1) Determination of reviewable conduct and judicial order —

Where, on application by the Commissioner, a court determines that a person
195
is engaging in or has engaged in reviewable conduct under this Part, the court
may order the person
(a) not to engage in the conduct or substantially similar reviewable
conduct;
(b) to publish or otherwise disseminate a notice, in such manner and at
such times as the court may specify, to bring to the attention of the class
of persons likely to have been reached or affected by the conduct, the
name under which the person carries on business and the determination
made under this section, including
(i) a description of the reviewable conduct,
(ii) the time period and geographical area to which the conduct re-
lates, and
(iii) a description of the manner in which any representation or ad-
vertisement was disseminated, including, where applicable, the name
of the publication or other medium employed;
(c) to pay an administrative monetary penalty, in any manner that the
court specifies, in an amount not exceeding
(i) in the case of an individual, $750,000 and, for each subsequent
order, $1,000,000, or
(ii) in the case of a corporation, $10,000,000 and, for each subsequent
order, $15,000,000; and
(d) in the case of conduct that is reviewable under paragraph 74.01(1)(a),
to pay an amount, not exceeding the total of the amounts paid to the per-
son for the products in respect of which the conduct was engaged in, to be
distributed among the persons to whom the products were sold — except
wholesalers, retailers or other distributors, to the extent that they have
resold or distributed the products — in any manner that the court consid-
ers appropriate.
(2) Duration of order — An order made under paragraph (1)(a) applies for
a period of ten years unless the court specifies a shorter period.
(3) Saving — No order may be made against a person under paragraph
(1)(b), (c) or (d) if the person establishes that the person exercised due dili-
gence to prevent the reviewable conduct from occurring.
(4) Purpose of order — The terms of an order made against a person
under paragraph (1)(b), (c) or (d) shall be determined with a view to promot-
ing conduct by that person that is in conformity with the purposes of this Part
and not with a view to punishment.
(5) Aggravating or mitigating factors — Any evidence of the following
shall be taken into account in determining the amount of an administrative
monetary penalty under paragraph (1)(c):
(a) the reach of the conduct within the relevant geographic market;
196
(b) the frequency and duration of the conduct;

(c) the vulnerability of the class of persons likely to be adversely affected
by the conduct;
(d) the materiality of any representation;
(e) the likelihood of self-correction in the relevant geographic market;
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(f) the effect on competition in the relevant market;
(g) the gross revenue from sales affected by the conduct;
(h) the financial position of the person against whom the order is made;
(i) the history of compliance with this Act by the person against whom the
order is made;
(j) any decision of the court in relation to an application for an order
under paragraph (1)(d);
(k) any other amounts paid or ordered to be paid by the person against
whom the order is made as a refund or as restitution or other compensa-
tion in respect of the conduct; and
(l) any other relevant factor.
(6) Meaning of subsequent order — For the purposes of paragraph
(1)(c), an order made against a person in respect of conduct that is reviewable
under paragraph 74.01(1)(a), (b) or (c), subsection 74.01(2) or (3) or section
74.02, 74.04, 74.05 or 74.06 is a subsequent order if
(a) an order was previously made against the person under this section in
respect of conduct reviewable under the same provision;
(b) the person was previously convicted of an offence under the provision
of Part VI, as that Part read immediately before the coming into force of
this Part, that corresponded to the provision of this Part;
(c) in the case of an order in respect of conduct reviewable under para-
graph 74.01(1)(a), the person was previously convicted of an offence
under section 52, or under paragraph 52(1)(a) as it read immediately
before the coming into force of this Part; or
(d) in the case of an order in respect of conduct reviewable under subsec-
tion 74.01(2) or (3), the person was previously convicted of an offence
under paragraph 52(1)(d) as it read immediately before the coming into
force of this Part.
(7) Amounts already paid — In determining an amount to be paid under
paragraph (1)(d), the court shall take into account any other amounts paid or
ordered to be paid by the person against whom the order is made as a refund
or as restitution or other compensation in respect of the products.
197
(8) Implementation of the order — The court may specify in an order

made under paragraph (1)(d) any terms that it considers necessary for the
order’s implementation, including terms
(a) specifying how the payment is to be administered;
(b) respecting the appointment of an administrator to administer the pay-
ment and specifying the terms of administration;
(c) requiring the person against whom the order is made to pay the ad-
ministrative costs related to the payment as well as the fees to be paid to
an administrator;
(d) requiring that potential claimants be notified in the time and manner
specified by the court;
(e) specifying the time and manner for making claims;
(f) specifying the conditions for the eligibility of claimants, including con-
ditions relating to the return of the products to the person against whom
the order is made; and
(g) providing for the manner in which, and the terms on which, any
amount of the payment that remains unclaimed or undistributed is to be
dealt with.
(9) Variation of terms — On application by the Commissioner or the per-
son against whom the order is made, the court may vary any term that is spec-
ified under subsection (8).
1999, c. 2, s. 22; 2009, c. 2, s. 424(2)–(5)
Commentary
Section 74.1 contains a selection of administrative remedies aimed at insuring compliance
with the Act. These remedies can be obtained by the Commissioner of Competition upon an
application to the Competition Tribunal, the Federal Court (Trial Division) or the superior
court of a province, and following a determination that a person was engaging in the review-
able conduct of deceptive marketing. The Commissioner may obtain a “cease and desist”
order ordering the person not to engage in such conduct, requiring the person to publish or
otherwise disseminate a notice in regard to the reviewable conduct or requiring payment of
an administrative monetary penalty in the amount of $750,000 for an individual, and
$10,000,000 for a corporation. If a person has shown that due diligence was exercised, subs.
74.1(3) limits the administrative remedies available to a “cease and desist” order.
In 2011 the Commissioner and Bell Canada entered into a consent agreement pursuant to
which Bell agreed to modify its non-compliant advertisements within 60 days; to not make
any new representations that use disclaimers that contradict the general impression of the
representation; and pay an administrative monetary penalty of $10 million. The consent
agreement also required Bell to report to the Commissioner (within 30 days of a request) on
its compliance with the agreement. The term of the agreement was ten years. The Bureau
had concluded that Bell made misleading representations about the prices offered for its ser-
vices contrary to paragraph 74.01(1)(a). In the Commissioner’s view, Bell had advertised
prices that were not in fact available, as additional mandatory fees were hidden from con-
sumers in fine-print disclaimers. See Competition Bureau, News Release, “Competition Bu-
198
reau Reaches Agreement with Bell Canada Requiring Bell to Pay $10 Million for Misleading
Advertising” (28 June 2011).
In 2015 the Commissioner brought an application against Avis and Budget, alleging that
they had advertised prices for rental cars that were not attainable due to additional fees im-
posed during the rental process. The Commissioner sought an order from the Competition
Tribunal requiring Avis and Budget to stop making the representations, $30 million in ad-
Act
ministrative monetary penalties, and refunds for consumers. Avis and Budget settled the case
for $3.25 million, and agreed to establish internal education and monitoring programs for a
period of 10 years. Similarly, in 2017, Hertz Canada Ltd. and Dollar Thrifty Automotive
Group Canada Inc. entered into a consent agreement for advertising low prices that were
unattainable because of mandatory fees that were systematically added to those prices. The
Commissioner concluded that the companies’ price representations were misleading and it
was not sufficient for the companies to provide an estimate of the total price before consum-
ers completed their reservation. The companies agreed to pay an administrative monetary
penalty of $1.25 million, and to implement new procedures aimed at preventing future con-
traventions of the Competition Act. In 2018, Enterprise Rent-A-Car Canada and Discount
Car & Truck Rentals Ltd. agreed to pay administrative monetary penalties of $1 million and
$700,000, respectively, and review their practices to ensure that their advertisements comply
with the law. As of this writing, there have been four consent agreements related to the
Bureau’s investigations into drip pricing practices by car rental companies, leading to a total
of $5.95 million in administrative monetary penalties.
In 2017, Amazon agreed to pay a $1 million administrative monetary penalty and $100,000
towards the Competition Bureau’s costs as part of a consent agreement reached following an
investigation into its marketing practices. The conduct in this case also had to do with ordi-
nary sale price claims, where Amazon compared a product’s selling price with a list price
using struck-through typeface and often included “You Save” claims that included dollar and
percentage savings from the list price. However, these “list prices” were lower than prevail-
ing market prices (thus inflating the savings representation). Amazon had relied on its sup-
pliers to provide these list prices without verifying that they were accurate.
See also the commentary to subsection 79(3.1) for a discussion of the constitutionality of
administrative monetary penalties.
Case Law
The Commissioner of Competition v. Hudson’s Bay Company, 2017 Comp Trib 19 — Pursu-
ant to a motion brought by the Commissioner with respect to HBC’s (potentially insuffi-
cient) affidavit of documents in response to a Tribunal scheduling order, the Tribunal con-
cluded that 74.1 of the Act does not entitle the Commissioner to discovery regarding
“substantially similar reviewable conduct” simply because the Commissioner may be enti-
tled to a remedy that involves prohibiting “substantially similar reviewable conduct”. The
Tribunal refused to allow the Commissioner to expand the scope of its notice of application
and go on, what would constitute, a “fishing expedition” into all of HBC’s promotional prac-
tices and commercial conduct (rather than with respect to sleep sets specifically, which
formed the basis of the Commissioner’s notice of application). HBC, however, was required
to produce further documents with respect to sleep sets specifically. HBC and the Bureau
reached a consent agreement where HBC agreed to pay a $4 million penalty and $500,000
towards the Bureau’s costs to resolve the proceeding.
Canada (Competition Bureau) v. Chatr Wireless Inc., 2013 ONSC 5315 (Ont. S.C.J.) —
Misleading advertising proceedings, commenced in this case under the Ontario Rules of
199
Civil Procedure, are regulatory in nature and do not carry with them the possibility that the
respondents will be imprisoned. Section 74.1(4) provides that the terms of any order made
against a person under paragraph (1)(b), (c) or (d) shall be determined with a view to pro-
moting conduct by that person that is in conformity with the Deceptive Marketing Practices
Part of the Act, and not with a view to punishment. This section of the Competition Act
clearly informs any application of the principle of proportionality at the penalty-fixing stage
of proceedings under s. 74.01(1)(b). A consideration of these factors and the balance of the
evidence establishes that the administrative monetary penalties provided for in s. 74.1(1)(c)
are not “true penal consequences.” Accordingly, the $10 million administrative monetary
penalty provided for in s. 74.1(1)(c) does not engage s. 11 of the Charter.
Canada (Commissioner of Competition) v. Gestion Lebski, 2006 Comp. Trib. 32 (Competi-
tion Trib.) — The Commisioner of Competition alleged that the defendants had employed
deceptive marketing practices contrary to subs. 74.01(a) and (b) of the Act to promote cer-
tain products and an apparatus, purported to help people to lose weight. The defendants sub-
mitted that subs. 74.01(a) and (b) infringed their rights under ss. 11, 7 and 2 of the Charter of
Rights and Freedoms. The Tribunal ruled that s. 11 of the Charter was not applicable as
paragraphs 74.01(a) and 74.01(b) of the Act did not create an offence within the meaning of
s. 11, as they were not criminal proceedings, and did not give rise to true penal conse-
quences. With respect to s. 7 of the Charter, the Tribunal ruled this section was inapplicable
as the life, liberty or security interests of the defendant were not threatened by the impugned
provisions. Although paragraph 74.01(a) infringed freedom of expression under s. 2 of the
Charter, it was ruled to be constitutional as false advertising did not merit constitutional
protection. However, the Tribunal ruled that paragraph 74.01(b) of the Act did infringe the
freedom of expression, and was declared of no force or effect, as untested or insufficiently
tested claims may be entirely true. The Commissioner did not present any evidence to show
that the impairment of freedom of expression was demonstrably justified in a free and demo-
cratic society. The Tribunal found that the representations made to the public were false or
misleading in a material respect contrary to paragraph 74.01(a) of the Act, and issued a
prohibition order.
(Competition Trib.) — The Commissioner alleged that, during three sales events, the retailer
employed deceptive marketing practices in respect of price representations concerning dis-
counts for the purchase of single or multiple units of automobile tires. During half of the six-
month period preceding the representations, the retailer had offered the tires for sale at the
regular price for a substantial period of time. The Tribunal found that the retailer had not
complied with either the volume test or the time test which serve to determine whether a
person has engaged in reviewable conduct in regards to the ordinary selling price, and had
failed to establish that its representations on the ordinary selling price were not false or mis-
leading in a material way. As a result, the Tribunal issued a prohibition order, applicable to
tires and other automotive products and services, directing the retailer not to engage in con-
duct contrary to subs. 74.01(3) of the Act for a period of ten years. Limiting the order to
apply only to the retailer’s promotion of tires would construe the intent of the Act too nar-
rowly. The Tribunal did not order the issuance of a corrective notice as five years had
elapsed since the representations were made. There was no residual mistaken impression
existing which arose from the representations. On the issue of an administrative monetary
penalty, the retailer had previously been granted leave, if it was determined that it had en-
gaged in reviewable conduct, to present evidence and make submissions at a future hearing
on the factors to be taken into account in setting the amount of the administrative penalty.
200
74.101 (1) Deduction from administrative monetary penalty — If a

court determines that a person is engaging in or has engaged in conduct that is
reviewable under section 74.011 and orders the person to pay an administra-
tive monetary penalty under paragraph 74.1(1)(c), then the court shall deduct
from the amount of the penalty that it determines any amount that the person
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(a) has been ordered to pay under paragraph 51(1)(b) of An Act to pro-
mote the efficiency and adaptability of the Canadian economy by regulating
certain activities that discourage reliance on electronic means of carrying
out commercial activities, and to amend the Canadian Radio-television and
Telecommunications Commission Act, the Competition Act, the Personal In-
formation Protection and Electronic Documents Act and the Telecommuni-
cations Act in respect of the same conduct; or
(b) has agreed in a settlement agreement to pay on account of amounts
referred to in paragraph 51(1)(b) of that Act in respect of the same
conduct.
(2) Restitution and interim injunction — If a court determines that a
person is engaging in or has engaged in conduct that is reviewable under sub-
section 74.011(2), it may order the person to pay an amount under paragraph
74.1(1)(d), and may issue an interim injunction under section 74.111, as if the
conduct were conduct that is reviewable under paragraph 74.01(1)(a).
2010, c. 23, s. 79
74.11 (1) Temporary order — On application by the Commissioner, a court

may order a person who it appears to the court is engaging in conduct that is
reviewable under this Part not to engage in that conduct or substantially simi-
lar reviewable conduct if it appears to the court that
(a) serious harm is likely to ensue unless the order is issued; and
(b) the balance of convenience favours issuing the order.
(1.1) Temporary order — supply of a product — On application by the
Commissioner, a court may order any person named in the application to re-
frain from supplying to another person a product that it appears to the court
is or is likely to be used to engage in conduct that is reviewable under this
Part, or to do any act or thing that it appears to the court could prevent a
person from engaging in such conduct, if it appears to the court that
(a) serious harm is likely to ensue unless the order is issued; and
(b) the balance of convenience favours issuing the order.
(2) Duration — Subject to subsection (5), an order made under subsection (1)
or (1.1) has effect, or may be extended on application by the Commissioner,
for any period that the court considers sufficient to meet the circumstances of
the case.
(3) Notice of application — Subject to subsection (4), at least 48 hours’
notice of an application referred to in subsection (1), (1.1) or (2) shall be given
201
by or on behalf of the Commissioner to the person in respect of whom the

order or extension is sought.
(4) Ex parte application — The court may proceed ex parte with an appli-
cation made under subsection (1) or (1.1) if it is satisfied that subsection (3)
cannot reasonably be complied with or that the urgency of the situation is such
that service of notice in accordance with subsection (3) would not be in the
public interest.
(5) Duration of ex parte order — An order issued ex parte shall have ef-
fect for such period as is specified in it, not exceeding seven days unless, on
further application made on notice as provided in subsection (3), the court ex-
tends the order for such additional period as it considers necessary and
sufficient.
(6) Duty of Commissioner — Where an order issued under this section is
in effect, the Commissioner shall proceed as expeditiously as possible to com-
plete the inquiry under section 10 arising out of the conduct in respect of
which the order was issued.
1999, c. 2, s. 22; 2002, c. 16, s. 10; 2010, c. 23, s. 80
Commentary
Pursuant to s. 74.11, the Commissioner may apply to the court for a temporary order order-
ing a person not to engage in the reviewable conduct of deceptive marketing. The court may
grant such order if it is satisfied that (a) serious harm is likely to ensure unless the order is
issued, and (b) the balance of convenience favours issuing the order. “Court” is defined in s.
74.09 to include the Competition Tribunal, the Federal Court – Trial Division or the superior
court of a province.
74.111 (1) Interim injunction — If, on application by the Commissioner, a

court finds a strong prima facie case that a person is engaging in or has en-
gaged in conduct that is reviewable under paragraph 74.01(1)(a), and the
court is satisfied that the person owns or has possession or control of articles
within the jurisdiction of the court and is disposing of or is likely to dispose of
them by any means, and that the disposal of the articles will substantially im-
pair the enforceability of an order made under paragraph 74.1(1)(d), the court
may issue an interim injunction forbidding the person or any other person
from disposing of or otherwise dealing with the articles, other than in the man-
ner and on the terms specified in the injunction.
(2) Statement to be included — Any application for an injunction under
subsection (1) shall include a statement that the Commissioner has applied for
an order under paragraph 74.1(1)(d), or that the Commissioner intends to ap-
ply for an order under that paragraph if the Commissioner applies for an or-
der under paragraph 74.1(1)(a).
202
(3) Duration — Subject to subsection (6), the injunction has effect, or may be
extended on application by the Commissioner, for any period that the court
considers sufficient to meet the circumstances of the case.
(4) Notice of application by Commissioner — Subject to subsection
(5), at least 48 hours’ notice of an application referred to in subsection (1) or
Act
(3) shall be given by or on behalf of the Commissioner to the person in respect
of whom the injunction or extension is sought.
(5) Ex parte application — The court may proceed ex parte with an appli-
cation made under subsection (1) if it is satisfied that subsection (4) cannot
reasonably be complied with or where the urgency of the situation is such that
service of the notice in accordance with subsection (4) might defeat the pur-
pose of the injunction or would otherwise not be in the public interest.
(6) Duration of ex parte injunction — An injunction issued ex parte has
effect for the period that is specified in it, not exceeding seven days unless, on
further application made on notice as provided in subsection (4), the court ex-
tends the injunction for any additional period that it considers sufficient.
(7) Submissions to set aside — On application of the person against
whom an ex parte injunction is made, the court may make an order setting
aside the injunction or varying it subject to any conditions that it considers
appropriate.
(8) Duty of Commissioner — If an injunction issued under this section is
in effect, the Commissioner shall proceed as expeditiously as possible to com-
plete any inquiry under section 10 arising out of the conduct in respect of
which the injunction was issued.
(9) Definitions — The following definitions apply in this section.
“dispose”, in relation to an article, includes removing it from the jurisdiction
of the court, depleting its value, leasing it to another person or creating any
security interest in it. (“disposer”)
“security interest” means any interest or right in property that secures pay-
ment or performance of an obligation and includes an interest or right created
by or arising out of a debenture, mortgage, hypothec, lien, pledge, charge, se-
curity, deemed or actual trust, assignment or encumbrance of any kind
whatever, however or whenever arising, created, deemed to arise or otherwise
provided for. (“garantie”)
2009, c. 2, s. 425
74.12 (1) Consent agreement — The Commissioner and a person in re-

spect of whom the Commissioner has applied or may apply for an order under
this Part may sign a consent agreement.
(2) Terms of consent agreement — The consent agreement shall be
based on terms that could be the subject of an order of a court against that
203
person, and may include other terms, whether or not they could be imposed by
the court.
(3) Registration — The consent agreement may be filed with the court for
immediate registration.
(4) Effect of registration — Upon registration of the consent agreement,
the proceedings, if any, are terminated and the consent agreement has the
same force and effect, and proceedings may be taken, as if it were an order of
the court.
1999, c. 2, s. 22; 2002, c. 16, s. 11
Commentary
Section 74.12 provides for consent agreements for deceptive marketing and their registration
with the court. The Commissioner of Competition and a person against whom an order has
been or may be applied for under Part VII.I may sign a consent agreement. The agreement
shall be based on terms that could be the subject of an order of the court, and may include
other terms, whether or not they could be imposed by the court. The agreement may then be
filed with the court, and upon registration, shall have the same effect as an order of the court
itself.
Case Law
Canada (Commissioner of Competition) v. P.V.I. International Inc. (2004), 31 C.P.R. (4th)
331 (F.C.A.); varying (2002), 19 R.P.R. (4th) 129 (Competition Trib.) — The Commissioner
of Competition brought an application alleging that the respondents had made misrepresenta-
tions to the public for the purposes of promoting a product and misrepresentations as to the
performance of a product not based upon adequate and proper tests. The Commissioner sub-
mitted that these misrepresentations constituted reviewable conduct contrary to s. 74.01 of
the Act. The respondents were marketing and selling a product which they claimed would
increase gas or diesel mileage, and would reduce exhaust emissions. The Commissioner suc-
cessfully applied for an order of the Competition Tribunal requiring the respondents to pay
an administrative penalty with respect to the gasoline product, and prohibiting the respon-
dents from making representations to the public which were contrary to Part VII.1 of the
Act. Although a U.S. court decision dismissed the U.S. government claims of false advertis-
ing for the same product, the U.S. decisions were not binding on the Tribunal, and involved
different evidence being presented. The respondents’ advertising gave the impression that
the U.S. government had approved the product, and confirmed its capacity to increase fuel
efficiency by paraphrasing the U.S. District Court decision in a false and misleading manner.
In view of the U.S. court decision, however, it was not appropriate to award the maximum
administrative monetary penalty.
The respondents appealed against the Tribunal’s order with respect to the gasoline product.
The Commissioner cross-appealed on the basis that the Tribunal erred in law by declining to
order the respondents to issue a notice correcting the misrepresentations, and by declining to
issue an administrative penalty with respect to the diesel product. The appeal was dismissed,
and the cross-appeal was allowed in part only to the extent of correcting the reasoning of the
Tribunal. With respect to the respondent’s appeal, the Tribunal had not made any reviewable
error, nor breached its duty of fairness. With respect to the cross-appeal, if the Tribunal took
judicial notice of U.S. regulatory practice as a basis not to order the respondents to issue a
corrective notice, the Tribunal should have so indicated, and given the parties an opportunity
204
to respond. However, the Tribunal gave another reason for refusing the corrective notice, and
that was the reliance on a U.S. District Court decision, which found that misrepresentations
about the respondents’ product was not substantiated.
Section 74.1 did not require the kind of detail in a corrective notice apparently contemplated
by the Tribunal. The Tribunal, by taking into account an irrelevant consideration, erred in
law in the exercise of its discretion. However, with the lapse of time between the respon-
Act
dents’ last false or misleading representations, and the Commissioner’s acknowledgment that
its primary concern related to the precedential nature of the Tribunal’s ruling, remitting the
matter back to the Tribunal for reconsideration would have little practical value. Even as-
suming that the respondents’ undertaking not to repeat the misrepresentations was an irrele-
vant consideration, the appellate court was not prepared to infer from the Tribunal’s reasons
that the Tribunal did not exercise its discretion not to impose an administrative penalty re-
specting the diesel product on a more holistic view of the facts of the case than the Commis-
sioner suggested.
Canada (Commissioner of Competition) v. Universal Payphone Systems Inc. (September 24,
1999) (Comp. Trib., Lutfy J.) — The Commissioner applied to the Competition Tribunal for
an order under s. 74.11 directing Universal and any person acting on its behalf to cease to
engage in certain reviewable conduct for a period of 14 days from the date of the order.
Evidence was presented that Universal made specific false or misleading representations to
the public creating the impression as to the model of pay telephone available being the same
as that utilized by Bell Canada, and creating the impression that the telephones would gener-
ate an immediate and continuous cash flow. The Tribunal found that a strong prima facie
case was made out, and was satisfied that serious harm was likely to ensue if the order was
not issued. As Universal agreed that the order could extend for 28 days, the Tribunal ordered
the cessation of certain false or misleading representations to the public for a period of 28
days.
Case Law
Canada (Commissioner of Competition) v. 3628159 Canada Inc. (c.o. Antirouilles
Electroniques TP), Garantie Express Inc. and Jacques Nadeau (December 12, 2001), Doc.
CT-2001/006 (Competition Trib.) — On December 12, 2001, a consent order was issued
under s. 74.12 of the Act against two companies and a corporate officer in respect of false or
misleading representations concerning the non-inhibiting benefits of an electronic device and
a related warranty. The performance claims were not supported by proper testing, and there
was no reasonable likelihood of warranty coverage. For a period of ten years, the parties
were ordered to stop making the representations by any means, to cease promoting the prod-
uct, to retrieve the promotional material distributed in the market place, to cancel all installa-
tion contracts with car dealers and installers, to advise purchasers of the product of their right
to return the product for a refund, and to refrain from re-introducing the product without
sufficient testing.
Canada (Commissioner of Competition) v. Phone Directories Inc. (May 10, 2002), CT-
2002/02 (Competition Trib.) — The respondent contacted businesses in British Columbia in
promoting the sale of advertisements in telephone directories to be published and distributed
by the respondent. The respondent made false or misleading representations regarding the
number of directories to be published for given geographic regions, the date upon which the
directories would be published and distributed, and the density of distribution of any given
directory. The respondent entered into a consent order with the Commissioner agreeing to
resolve, expeditiously and on a commercially reasonable basis, all disputes arising from any
false or misleading representation referred to in the order. The respondent also agreed to
205
refrain from making any representations regarding the rate or level of usages of its telephone
directories, unless such usage representations were substantiated by a verifiable and statisti-
cally sound survey performed prior to the making of the representation.
74.13 Rescission or variation of consent agreement or order —

The court may rescind or vary a consent agreement that it has registered or an
order that it has made under this Part, on application by the Commissioner or
the person who consented to the agreement, or the person against whom the
order was made, if the court finds that
(a) the circumstances that led to the making of the agreement or order
have changed and, in the circumstances that exist at the time the applica-
tion is made, the agreement or order would not have been made or would
have been ineffective in achieving its intended purpose; or
(b) the Commissioner and the person who consented to the agreement
have consented to an alternative agreement or the Commissioner and the
person against whom the order was made have consented to an alterna-
tive order.
1999, c. 2, s. 22; 2002, c. 16, s. 11
Commentary
The Commissioner or the person who consented to an agreement pursuant to s. 74.12 may
apply to the court to rescind or vary the consent agreement that has been registered or an
order made under Part VII.I if the circumstances that led to such agreement or order have
changed, and under the current circumstances, the agreement or order would not have been
made or would have been ineffective in achieving its intended purpose.
74.14 Evidence — In determining whether or not to make an order under

this Part, the court shall not exclude from consideration any evidence by rea-
son only that it might be evidence in respect of an offence under this Act or in
respect of which another order could be made by the court under this Act.
1999, c. 2, s. 22
74.15 Unpaid monetary penalty — The amount of an administrative

monetary penalty imposed on a person under paragraph 74.1(1)(c) is a debt
due to Her Majesty in right of Canada and may be recovered as such from
that person in a court of competent jurisdiction.
1999, c. 2, s. 22
74.16 Where proceedings commenced under section 52 or

52.01 — No application may be made under this Part against a person on the
basis of facts that are the same or substantially the same as the facts on the
basis of which proceedings have been commenced against that person under
section 52 or 52.01.
1999, c. 2, s. 22; 2010, c. 23, s. 81
206
Part VIII — Reviewable Matters (ss.75-107) S. 75(1)(a)
Rules of Procedure
74.17 Power of courts — The rules committee of the Federal Court, or a
superior court of a province, may make rules respecting the procedure for the
disposition of applications by that court under this Part.
Act
1999, c. 2, s. 22
Appeals
74.18 (1) Appeal to Federal Court of Appeal — An appeal may be
brought in the Federal Court of Appeal from any decision or order made
under this Part, or from a refusal to make an order, by the Tribunal or the
Federal Court.
(2) Appeal to provincial court of appeal — An appeal may be brought
in the court of appeal of a province from any decision or order made under
this Part, or from a refusal to make an order, by a superior court of the
province.
(3) Disposition of appeal — Where the Federal Court of Appeal or the
court of appeal of the province allows an appeal under this section, it may
quash the decision or order appealed from, refer the matter back to the court
appealed from or make any decision or order that, in its opinion, that court
should have made.
1999, c. 2, s. 22; 2002, c. 8, s. 183(1)(f)
74.19 Appeal on question of fact — An appeal on a question of fact from

a decision or order made under this Part may be brought only with the leave
of the Federal Court of Appeal or the court of appeal of the province, as the
case may be.
1999, c. 2, s. 22

(SS. 75–107)

Refusal to Deal
75. (1) Jurisdiction of Tribunal where refusal to deal — Where, on

application by the Commissioner or a person granted leave under section
103.1, the Tribunal finds that
(a) a person is substantially affected in his business or is precluded from
carrying on business due to his inability to obtain adequate supplies of a
product anywhere in a market on usual trade terms,
207
(b) the person referred to in paragraph (a) is unable to obtain adequate

supplies of the product because of insufficient competition among suppli-
ers of the product in the market,
(c) the person referred to in paragraph (a) is willing and able to meet the
usual trade terms of the supplier or suppliers of the product,
(d) the product is in ample supply, and
(e) the refusal to deal is having or is likely to have an adverse effect on
competition in a market,
the Tribunal may order that one or more suppliers of the product in the mar-
ket accept the person as a customer within a specified time on usual trade
terms unless, within the specified time, in the case of an article, any customs
duties on the article are removed, reduced or remitted and the effect of the
removal, reduction or remission is to place the person on an equal footing with
other persons who are able to obtain adequate supplies of the article in
Canada.
(2) When article is a separate product — For the purposes of this sec-
tion, an article is not a separate product in a market only because it is differ-
entiated from other articles in its class by a trademark, proprietary name or
the like, unless the article so differentiated occupies such a dominant position
in that market as to substantially affect the ability of a person to carry on
business in that class of articles unless that person has access to the article so
differentiated.
(3) Definition of “trade terms” — For the purposes of this section, the
expression “trade terms” means terms in respect of payment, units of
purchase and reasonable technical and servicing requirements.
(4) Inferences — In considering an application by a person granted leave
under section 103.1, the Tribunal may not draw any inference from the fact
that the Commissioner has or has not taken any action in respect of the matter
raised by the application.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(w); 2002, c. 16, s. 11.1; 2014, c.
20, s. 366(1)
Commentary
Section 75 establishes the reviewable practice of refusal to supply. Pursuant to subsection
75(1), the Competition Tribunal may make an order if it determines the following five re-
quirements have been satisfied:
• A person must be substantially affected in his business or precluded from carrying on
business due to his inability to obtain adequate supplies of a product anywhere in a
market on usual trade terms. Case law has established that the entire business of the
person must be “substantially affected”, not just the portion of the business for which
supply has been cut-off. In practice, this requirement may be difficult to satisfy in the
absence of a previous course of dealings. In other words, it may be difficult for an
applicant seeking supply for the first time to establish that a refusal substantially af-
fected his business or precluded him from carrying on business.
208
Part VIII — Reviewable Matters (ss.75-107) S. 75
• The affected person must be unable to obtain adequate supplies of the product because
of insufficient competition among suppliers of the product in the market. This can and
has resulted in very narrow definitions of “product.” In Chrysler and Xerox, the Tribu-
nal determined that the relevant products were branded proprietary parts of a single
original equipment manufacturer. The Tribunal has also granted leave to make an ap-
plication in cases involving La-Z-Boy furniture and Harley Davidson motorcycles. It is
Act
unclear whether intellectual property meets the requirement of “product” (Per Director
of Investigation and Research) v. Warner Music Canada Ltd., discussed below). Per
Warner, intellectual property cannot be a product under s. 75 because the legal rights
over intellectual property, which are exclusive by their very nature, cannot be in ample
supply and there cannot be usual trade terms when licences may be withheld. Warner
has not been overturned; however, it was distinguished in 2005 by the Federal Court
(Cinémas Guzzo Inc. v. Canada (Attorney General)).
This issue also arose in Used Car Dealers Association of Ontario v. Insurance Bureau
of Canada. In September 2011, the Tribunal granted leave to the Used Car Dealers
Association of Ontario (UCDA) to bring an application against the Insurance Bureau of
Canada (IBC). UCDA claimed that the IBC had stopped supplying the UCDA with
information on vehicle accident and claims history, which the IBC compiles from its
member insurers. According to the UCDA, it relied on being able to purchase this data
to supply vehicle accident history reports to its members. The issue of whether “data”
meets the requirement of “product” was not addressed on its merits because a settle-
ment was reached between the parties and the application by the UCDA was with-
drawn in January 2013.
In 2015, an Ontario-based record label, Stargrove Entertainment, filed a complaint with
the Tribunal alleging that Universal Music Publishing Group Canada and others vio-
lated the refusal to deal and price maintenance provisions of the Competition Act by
withholding mechanical licenses on usual trade terms. Stargrove alleged that record
labels and music publishers have been applying pressure on Stargrove’s distributors,
thereby attempting to shut down its distribution chain and violating the exclusive deal-
ing provision of the Act.
The Tribunal affirmed prior case law which held that relief is not available under sec-
tions 75 or 77 where the impugned conduct involves the refusal to grant a license over
copyrighted material (although the Tribunal left open the possibility that, for some stat-
utory purposes, a copyright may be a “product”). Further, the Tribunal confirmed that
to be substantial there must be an effect (proven with sufficient evidence) that is “im-
portant or significant”; it need not be such that the affected party will be unable to carry
on.
Also in 2015, Audatex Canada, ULC (a corporation that licenses data and software to
Canadian automobile insurance companies) filed a complaint against CarProof Corpo-
ration alleging that CarProof has undertaken a systematic course of conduct by entering
into exclusive agreements for Canadian automobile listings data with the most signifi-
cant suppliers of Canadian automobile listings data. The direct suppliers of this data
are, therefore, contractually prohibited from sourcing a supply of Canadian automobile
listings to Audatex. Audatex argues that the automobile listings data needed by Au-
datex is merely factual data about automobiles that are for sale which is not arranged in
any original fashion (and is therefore not intellectual property).
Alternatively, Audatex argues that if the data is intellectual property, the general provi-
sions of the Act apply where an intellectual property holder’s conduct creates market
power beyond that inherent in the intellectual property rights. It argues that CarProof’s
209
accumulation of exclusive rights from multiple suppliers has allowed it to harm Au-
datex, not the exclusive rights flowing from any single supplier agreement. Audatex
further alleges that CarProof refuses to supply the data to Audatex on usual trade terms,
seeking expensive fees and concessions in unrelated dealings with Audatex. CarProof,
in its response, argues that the data at issue is IP (which cannot be in ample supply). It
also argues that Audatex is not willing to meet the usual trade terms for the supply of
the automobile listing data.
The Tribunal dismissed Audatex’s application for leave under section 75 because there
was insufficient evidence that it was directly and substantially affected by the refusal.
Specifically, there was insufficient evidence regarding: (i) the portion of Audatex’s to-
tal business that is represented by its total loss valuation business; (ii) the portion of its
supply of listings data that would be represented by Trader and Marktplaats data; and
(iii) how a refusal to supply listings data may impact Audatex’s partial loss valuation
business. The Tribunal held that in the circumstances, a loss of about one-quarter of the
business of Audatex resulting from the refusal to supply was not adequate to show the
substantial effect on a business necessary to obtain leave.
• The affected person must be willing and able to meet the usual trade terms of the sup-
plier or suppliers of the product. The phrase “trade terms” is defined in section 75(3).
• The product must be in ample supply. This provision is normally easy to satisfy, but
gives suppliers of scare resources increased flexibility to deny supply to existing or
potential customers.
• The refusal must be having or likely to have an adverse effect on competition in a
market. This requirement was added as part of the 2002 amendments to the Act that
introduced private access to the Tribunal for section 75. The phrase “likely to have an
adverse effect on competition” is also used in section 76 (price maintenance). In B-
Filer and Nadeau, the Tribunal distinguished between the term “substantial” found in
other provisions of the Act and the term “adverse” used in section 75. It found that the
difference lies in the degree of the effect and that “adverse”, according to its plain
meaning, is a lower threshold than “substantial”. Regarding the requirement that a re-
fusal to deal “is likely to have” such adverse effect, the Tribunal found the requirement
to establish the likelihood of an adverse effect requires proof that such an event is
“probable” and not merely possible.
The right of private parties to seek relief directly from the Tribunal is subject to the require-
ment to first obtain leave from the Tribunal to bring a case pursuant to section 103.1.
A refusal to supply could also breach section 76 or section 79, although refusal is not specifi-
cally identified as an anti-competitive act in section 78. In the case of abuse of dominance,
administrative monetary penalties of $10 million to $15 million can be imposed by the
Tribunal.
For a critical review and commentary on section 75 see: James Musgrove, Refusal to Deal in
Canada: a Primer, ABA Section of Antitrust Law Tele-seminar Distribution Issues in the
North Atlantic Triangle: Part III: Refusal to Deal: When Can — and Will — You be Re-
quired to Supply (January 2010); House of Commons Industry Committee, A Plan to Mod-
ernize Canada’s Competition Regime: Report of the Standing Committee on Industry, Sci-
ence and Technology, Chapter 8 (April 2002); and J. W. Rowley QC and A. N. Campbell,
Refusal to Deal (With Economics): An Assessment of the Competition Tribunal’s Decisions
in Chrysler and Xerox, University of Toronto Symposium Recent Developments in Canadian
Competition Law (December 1992).
210
Case Law
Nadeau Ferme Avicole Ltée v. Groupe Westco Inc., 2009 Comp. Trib. 6, 2009 CarswellNat
5934 (Competition Trib.); affirmed Nadeau Ferme Avicole Ltée/Nadeau Poultry Farm Ltd.
v. Groupe Westco Inc., 2011 FCA 188, 2011 CarswellNat 2032 (Fed. C.A.) — The appli-
cant, a chicken processor in New Brunswick, brought an application under section 75 against
the respondents, three of its chicken suppliers, for an order directing them to continue to
Act
supply the applicant with live chickens on usual trade terms in the volumes previously sup-
plied. The respondents had provided advance notice to the applicant in respect of the termi-
nation of supply. The applicant contended that the refusal to deal would reduce its supply of
live chickens by nearly 50% and would substantially affect its business. The application was
dismissed. The Tribunal held that the applicant had failed to establish that: it would be una-
ble to obtain adequate supplies of the product because of insufficient competition among
suppliers of the product anywhere in the market; the product was in ample supply; and the
refusal to deal was having or was likely to have an adverse effect on competition. In assess-
ing paragraph 75(1)(b) of the Act, the Tribunal found that there were many chicken produc-
ers in the relevant market and that the strict production quotas for chickens, not insufficient
competition, was the reason that the applicant would be unable to obtain an adequate supply
of replacement chickens. In assessing paragraph 75(1)(d) of the Act, the Tribunal held that a
product is in ample supply when its availability is not in issue for a supplier considering
developing or expanding its business by seeking new customers or new distribution chan-
nels. In this case, because the supply of live chickens was regulated under a quota by the
Chicken Farmers of Canada and, therefore, could not be made available on a timely basis to
enable business expansion or development, the Tribunal held that the product was not in
ample supply. In assessing paragraph 75(1)(e) of the Act, the Tribunal reaffirmed that its
approach for determining whether there has been an adverse effect on competition is similar
to its approach for determining whether there has been a “substantial lessening of competi-
tion”; however, the difference between the two is in the degree of the effect. The Tribunal
observed that “adverse” is something less than “substantial” and held that the refusal would
not have an adverse effect on competition in the market because, as a result of the refusal to
deal, no chicken processor would be placed in a position of created or enhanced market
power.
On appeal, the Federal Court of Appeal affirmed the Tribunal’s decision and dismissed the
appeal. The Tribunal did not err in concluding that the appellant failed to establish that it was
unable to obtain adequate supplies due to insufficient competition among suppliers in the
product market. The Court of Appeal agreed with the Tribunal’s conclusion on the issue of
ample supply but reformulated the appropriate test: A product is in ample supply when the
producers of that product have the capacity to increase production in a timely way to meet
increases in demand for the product. The appellant also failed to establish any basis on which
the court could conclude that the Tribunal had erred in law or come to an unreasonable
conclusion with respect to the Tribunal’s conclusion that the refusal to supply would not
have an adverse effect on a market.
B-Filer Inc. v. Bank of Nova Scotia, 2006 Comp. Trib. 42 (Competition Trib.); additional
reasons at 2007 CarswellNat 5893, 2007 Comp. Trib. 26 (Competition Trib.); additional rea-
sons at 2007 CarswellNat 5892, 2007 Comp. Trib. 29 (Competition Trib.) — The applicants
provided an Internet bank card debit payment service that allowed customers to make
purchases from participating Internet merchants with payments made directly from the cus-
tomer’s existing bank account. The applicants asserted that their former banker engaged in
reviewable conduct by terminating its banking relationship with the applicants, and thus re-
fusing to deal with them. The applicants sought an order requiring their former banker to
211
supply them with two specific banking services, bill payee services and bank accounts for
deposit of e-mail money transfers, that the bank formerly supplied to the applicants. The
Tribunal dismissed their application as the applicants failed to establish that they were subse-
quently affected in their business, or precluded from carrying on business, due to their inabil-
ity to obtain adequate supplies of a product anywhere in a market on usual trade terms (para.
75(1)(a)). The Tribunal held that upon termination of the banking services by the bank, the
applicants had replaced these services with e-mail money transfers into deposit accounts
such that they were not substantially affected in their business. The Tribunal further found
that the termination of the banking services was the result of objectively justifiable business
reasons related, in particular, to the fact that the applicants’ business required disclosure of
each customer’s electronic signature, and the fact that the applicants had not been compliant
with their anti-money laundering obligations.
Cinémas Guzzo Inc. v. Canada (Attorney General), [2005] F.C.J. No. 863 — The court dis-
tinguished Warner, where the dispute concerned the granting of licences by distributors to
licensees, with the present case, a dispute between distributors and movie theatre operators
over the acquisition of copies of films, not licences. In obiter, however, the court noted that
the term “product” does, “within the meaning of the Act, include licences, since to conclude
otherwise would prevent the Act from having any application at all in the area of intellectual
property.”
Manos Foods International Inc. v. Coca-Cola Ltd. (1999), 2 C.P.R. (4th) 283, 125 O.A.C.
66, 180 D.L.R. (4th) 309, 40 C.P.C. (4th) 113 (Ont. C.A.) — The court held that the statu-
tory remedies under ss. 75 and 77 of the Act were within the exclusive jurisdiction of the
Competition Tribunal and they did not give jurisdiction to common law courts. The court
had no common law jurisdiction to compel the defendants to enter into a contract for the sale
of its products to the plaintiff.
Canada (Director of Investigation & Research) v. Warner Music Canada Ltd. (1997), 78
C.P.R. (3d) 321 (Competition Trib.) — The Director brought an application alleging that the
respondents’ refusal to grant copyright licences to make sound recordings from their master
recordings to BMG, a mail-order record club business in Canada, contravened s. 75 of the
Act. The respondents moved to strike out the Directors’ application on the basis that s. 75
did not give the Tribunal jurisdiction to compel the respondents to issue licences for the
manufacture, distribution and sale of sound recordings from their master recordings. The
Director’s application was struck. The Tribunal concluded that it did not have jurisdiction to
grant the relief sought by the Director in his application. As a matter of copyright law, the
respondents had the right to refuse to licence their master recordings to BMG and any refusal
by the respondents could not be considered anti-competitive. The Tribunal held that the
licences were not a product as that term is used in s. 75 because on a sensible reading the
section did not apply to the facts. Intellectual property cannot be a product under s. 75 be-
cause the legal rights over intellectual property, which are exclusive by their very nature,
cannot be in ample supply and there cannot be usual trade terms when licences may be
withheld.
Canada (Director of Investigation & Research) v. Xerox Canada Inc. (1990), 33 C.P.R. (3d)
83 (Competition Trib.) — The Director filed an application with the Tribunal on behalf of
Exdos Corporation, an independent service organization involved in refurbishing copiers and
providing service for Xerox machines, following Xerox’s curtailment of supply of Xerox
parts. Xerox’s curtailment was specifically designed to eliminate competition from indepen-
dent service organizations, like Exdos, which were providing maintenance service for Xerox
photocopiers, and to preserve or enhance the revenue derived by Xerox from the service
aspect of its business. The application was granted. Xerox was ordered to supply post-1983
212
Xerox copier parts to Exdos; parts for the 50 series copiers were excluded from the order
because no evidence was adduced to indicate that Exdos would be substantially affected in
its business without supply of those parts.
The main issue in this case was the proper product market definition and whether Exdos’
inability to obtain adequate supplies of the product was caused by insufficient competition
among suppliers of the product in the market. Specifically, the Tribunal considered whether
Act
s. 75 encompasses a situation in which a product is proprietary and derives largely from a
single source. The Tribunal observed that a determination of the product market can be es-
tablished by a number of factors: actual and potential competition; integration and stages of
manufacturers; method of production or origin; physical characteristics of products or ser-
vices; end users of products; product substitutability; geographic area; and relative prices of
goods or services. In assessing these factors, the Tribunal concluded that the relevant market
was defined as parts for Xerox copiers in Canada. There was no compelling reason why
proprietary replacement parts should not be considered to be a relevant product for s. 75
purposes. The Tribunal concluded that there was an inadequate supply of Xerox parts due to
inadequate alternate sources of supply and that, as a result of Xerox’s refusal, Exdos would
be limited in its ability to obtain parts. The Tribunal noted that a market composed of numer-
ous suppliers acting independently would not qualify as insufficient competition among sup-
pliers. The overriding reason that adequate supplies are unavailable must be the competitive
conditions in the product market.
With respect to the constitutionality of s. 75, the respondent argued that if the Tribunal can
make an order under s. 75 to govern a supplier’s conduct without reference to the effect on
competition, then the section is legislation with respect to property and civil rights. The Tri-
bunal determined that the approach to use in assessing the constitutionality of a particular
section of the Act is the approach from City National Leasing Ltd. v. General Motors of
Canada Ltd., [1989] 1 S.C.R. 641 (S.C.C.). The Tribunal held that the the immediate effect
of an order under s. 75 is to open up the channels of distribution and free competitive forces
hindered by lack of access to supplies. The section’s primary objective is to promote or
preserve competition and its effect on contractual relations is only secondary.
Canada (Dir. of Investigation & Research) v. Chrysler Canada Ltd. (1989), 27 C.P.R. (3d) 1
(Competition Trib.); affirmed (1991), 38 C.P.R. (3d) 25, 129 N.R. 77 (Fed. C.A.); leave to
appeal to S.C.C. refused (1992), 41 C.P.R. (3d) v (note), 138 N.R. 319 (note) (S.C.C.) —
The Director filed an application with the Tribunal on behalf of Ralph Brunet, an auto parts
exporter. Brunet sold Chrysler parts and parts of other companies to customers in countries
outside of North America. Brunet had been encouraged by Chrysler to expand the sale of
Chrysler auto parts in the export market. Chrysler subsequently advised Brunet that it would
no longer be accepting orders from Brunet and had instructed its dealers not to sell Chrysler
auto parts for export. Chrysler also inserted a new clause into its dealer agreements to restrict
parts sales to the domestic market. The application was granted. The Tribunal determined
that the test for para. 75(1)(a) concerns the effect on the business of the person refused sup-
ply and, where products are purchased for resale, the effect on the business of the person
refused supply, will depend on the demand of that person’s customers and whether there are
acceptable substitutes. With respect to substitutes, the Tribunal noted that products that are
physically identical and are perfectly subsititutable in their end uses are properly regarded as
being in the same market unless geographic distance and directly related costs preclude their
substitutability. In this case, the Tribunal held that the relevant product market was the mar-
ket for Chrysler auto parts and that the relevant geographic market was Canada. The Tribu-
nal characterized Canada and the United States as distinct geographic markets because of the
213
existence of different price lists in the United States and Canada and the fact that price dif-
ferences were intended to respond to different market conditions in the two countries.
With respect to the meaning of “substantially affected”, the Tribunal held that “substantial”
should be given its ordinary meaning, which means more than something just beyond de
minimus. The Tribunal also held that the effect must be on the entire activity of which the
refused supplies are a part. The effect of a refusal to supply is not established solely by
examining the overall sales and profit figures. It is also necessary to consider whether: the
product at issue accounts for a large percentage of the overall business; the product can
easily be replaced by other products sold by the business; the sale of the product uses up
capacity that could be devoted to other activities; and the product is used or sold in conjunc-
tion with other products and services so that the effect on the overall results of the business
may be much greater than indicated by the volume of the product purchased.
While the Tribunal was satisfied that the Director had proven all of the elements of s. 75, it
took the following factors into account in determining whether or not to exercise its discre-
tion to issue an order: the reasons behind Chrysler’s decision to discontinue supply; the mar-
ket position of Chrysler and the changes it was making in its distribution system; the long
association between Brunet and Chrysler; the unquestioned encouragement that Chrysler
provided Brunet; and the manner in which the cut-off was implemented. The Tribunal
granted the order; Chrysler did not present any evidence that the granting of an order would
disadvantage it in any way.
On appeal, the court affirmed the Tribunal’s decision and held that s. 75 does not require that
the refusal to trade and resulting inability to obtain adequate supplies be the only factor
substantially affecting the business; it is sufficient that it have a substantial effect whatever
the impact of other factors.
Price Maintenance
76. (1) Price maintenance — On application by the Commissioner or a

person granted leave under section 103.1, the Tribunal may make an order
under subsection (2) if the Tribunal finds that
(a) a person referred to in subsection (3) directly or indirectly
(i) by agreement, threat, promise or any like means, has influenced
upward, or has discouraged the reduction of, the price at which the
person’s customer or any other person to whom the product comes
for resale supplies or offers to supply or advertises a product within
Canada, or
(ii) has refused to supply a product to or has otherwise discriminated
against any person or class of persons engaged in business in Canada
because of the low pricing policy of that other person or class of per-
sons; and
(b) the conduct has had, is having or is likely to have an adverse effect on
competition in a market.
(2) Order — The Tribunal may make an order prohibiting the person re-
ferred to in subsection (3) from continuing to engage in the conduct referred to
214
Part VIII — Reviewable Matters (ss.75-107) S. 76(8)
in paragraph (1)(a) or requiring them to accept another person as a customer

within a specified time on usual trade terms.
(3) Persons subject to order — An order may be made under subsection
(2) against a person who
(a) is engaged in the business of producing or supplying a product;
Act
(b) extends credit by way of credit cards or is otherwise engaged in a busi-
ness that relates to credit cards; or
(c) has the exclusive rights and privileges conferred by a patent, certifi-
cate of supplementary protection issued under the Patent Act, trademark,
copyright, registered industrial design or registered integrated circuit
topography.
(4) When no order may be made — No order may be made under sub-
section (2) if the person referred to in subsection (3) and the customer or other
person referred to in subparagraph (1)(a)(i) or (ii) are
(a) principal and agent or mandator and mandatary;
(b) an entity and an individual who controls it or affiliated entities; or
(c) directors, agents, mandataries, officers or employees of the same entity
or of entities that are affiliated.
(5) Suggested retail price — For the purposes of this section, a suggestion
by a producer or supplier of a product of a resale price or minimum resale
price for the product, however arrived at, is proof that the person to whom the
suggestion is made is influenced in accordance with the suggestion, in the ab-
sence of proof that the producer or supplier, in so doing, also made it clear to
the person that they were under no obligation to accept the suggestion and
would in no way suffer in their business relations with the producer or sup-
plier or with any other person if they failed to accept the suggestion.
(6) Advertised price — For the purposes of this section, the publication by
a producer or supplier of a product, other than a retailer, of an advertisement
that mentions a resale price for the product is proof that the producer or sup-
plier is influencing upward the selling price of any person to whom the prod-
uct comes for resale, unless the price is expressed in a way that makes it clear
to any person whose attention the advertisement comes to that the product
may be sold at a lower price.
(7) Exception — Subsections (5) and (6) do not apply to a price that is af-
fixed or applied to a product or its package or container.
(8) Refusal to supply — If, on application by the Commissioner or a per-
son granted leave under section 103.1, the Tribunal finds that any person, by
agreement, threat, promise or any like means, has induced a supplier, whether
within or outside Canada, as a condition of doing business with the supplier, to
refuse to supply a product to a particular person or class of persons because of
the low pricing policy of that person or class of persons, and that the conduct
215
of inducement has had, is having or is likely to have an adverse effect on com-

petition in a market, the Tribunal may make an order prohibiting the person
from continuing to engage in the conduct or requiring the person to do busi-
ness with the supplier on usual trade terms.
(9) Where no order may be made — No order may be made under sub-
section (2) in respect of conduct referred to in subparagraph (1)(a)(ii) if the
Tribunal is satisfied that the person or class of persons referred to in that sub-
paragraph, in respect of products supplied by the person referred to in subsec-
tion (3),
(a) was making a practice of using the products as loss leaders, that is to
say, not for the purpose of making a profit on those products but for pur-
poses of advertising;
(b) was making a practice of using the products not for the purpose of
selling them at a profit but for the purpose of attracting customers in the
hope of selling them other products;
(c) was making a practice of engaging in misleading advertising; or
(d) made a practice of not providing the level of servicing that purchasers
of the products might reasonably expect.
(11) Where proceedings commenced under section 45, 49, 79 or
90.1 — No application may be made under this section against a person on
the basis of facts that are the same or substantially the same as the facts on the
basis of which
(a) proceedings have been commenced against that person under section
45 or 49; or
(b) an order against that person is sought under section 79 or 90.1.
(12) Definition of “trade terms” — For the purposes of this section,
“trade terms” means terms in respect of payment, units of purchase and rea-
sonable technical and servicing requirements.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(x); 2009, c. 2, s. 426; 2014, c. 20,
s. 366(1); 2017, c. 6, s. 124; 2018, c. 8, s. 112
Commentary
Subsection 76(1) creates the reviewable practice of “resale price maintenance”. It is intended
to minimize restrictions on the ability of resellers to compete on price where restrictions
would have an “adverse impact on competition.” Section 76 was added to the Act in 2009 to
replace the criminal price maintenance offence previously found in s. 61 and now repealed.
The former criminal offence and current reviewable practice are largely the same, the only
significant substantive difference being that the former criminal offence made price mainte-
216
nance per se illegal, regardless of its impact on competition, whereas subs. 76(1) requires
that the price maintenance had an adverse effect on competition.
Conduct covered by s. 76 includes: influencing upward or discouraging the reduction of the
prices at which products are sold or advertised for sale (subpara. 76(1)(a)(i)); refusals to
supply a product or other discriminatory behaviour taken against a person or class of persons
due to their low pricing policies (subpara. 76(1)(a)(ii)); and pressuring a supplier, by making
Act
it a condition of doing business with the supplier, to refuse to supply a third party due to that
party’s low pricing policies (subs. 76(8)).
The Commissioner commenced a section 76 case against Visa and MasterCard in 2010 but,
as a general matter, public and private enforcement of section 76 is unlikely to be common.
The requirement that there be an adverse effect on competition will create a difficult hurdle
for applicants in a large number of cases. Some notable, high profile and presumably repre-
sentative criminal cases in the early 2000s involved Toyota automobiles, John Deere lawn
tractors, Stroh’s beer and Labatt beer. It is difficult to imagine that the Tribunal would have
concluded that the price maintenance alleged in those cases would have adversely affected
competition in markets for the relevant products. The procedural and remedial changes asso-
ciated with the move from a criminal offence to a civil reviewable matter are likely to make
private actions unlikely (they were never common) because private parties are unable to
commence class actions or seek damage awards.
provisions may be found in Price Maintenance (Section 76 of the Competition Act) Enforce-
ment Guidelines.
Subsections (1)–(4) and (8)

The burden of proof on the Commissioner or a private party under subpara. 76(1)(a)(i) is
essentially three-fold:
• First, the applicant must establish that the respondent directly or indirectly influenced
upward, or discouraged the reduction of, the price at which the respondent’s customer
or another reseller supplies, or offers to supply, a product. Unlike the previous criminal
offence, the respondent must actually affect the price — a mere attempt to do so is
insufficient. The removal of attempted price maintenance is a logical corollary to the
addition of a competitive effects test because a failed attempt to maintain prices could
not have an adverse effect on competition. Influencing the price downward is not sub-
ject to section 76.
• Second, the applicant must establish that the respondent’s actions were carried out by
agreement, threat, promise or like means. Under the former criminal price maintenance
offence, the word “threat” had been interpreted as meaning a form of intimidation,
fulmination, harassment or warning that carries with it some form of penalty. The
maintenance of prices through discussion, persuasion, complaints, suggestions, re-
quests, or advice that did not otherwise contravene the section had been found to be
legal.
• Third, the applicant must establish that the conduct had, is having or is likely to have
an “adverse effect on competition.” A similar standard applies for refusals to deal in
section 75, rather than the “substantially lessening” standard used elsewhere in the Act
(ss. 79, 90.1 and 92. The “adverse effect” test has been judicially considered on a few
occasions by the Competition Tribunal in section 75 cases and has been found to estab-
lish a lower threshold than the “substantial lessening” standard. That is, the negative
impact on competition under sections 75 and 76 need not be as severe as under sections
217
79, 90.1 and 92. In other respects, the same analytical approach will be taken to assess-
ing “adverse effect on competition” as with “substantial lessening of competition.” In
the price maintenance context, the Tribunal is unlikely to issue an order unless there is
an adverse effect on inter-brand competition (i.e., competition between brands). In
other words, although price maintenance could have the affect of eliminating intra-
brand competition (i.e., competition within a brand, such as price competition amongst
unaffiliated retailers of the same products), there will not be a contravention of section
76 as long as there is no adverse effect on competition within a relevant product mar-
ket. This will likely make it difficult for applicants to establish a contravention of sec-
tion 76 except in concentrated markets.
Similar burdens apply in connection with refusal to supply applications under subpara.
76(1)(a)(ii) and subsection 76(8).
The US Supreme Court in Leegin Creative Leather Products, Inc. v. PSKS, Inc. (2007), 551
U.S. 877 (U.S. S.C.) “identified four circumstances in which the use of RPM [Resale Price
Maintenance] might be anticompetitive: (1) when used by a manufacturer cartel to detect
cheating on a price-fixing agreement; (2) when used to organize a retailer cartel by coercing
manufacturers to eliminate price cutting; (3) when used by a dominant retailer to protect it
from retailers with better distribution systems and lower cost structures, thereby forestalling
innovation in distribution; and (4) when used by a manufacturer with market power to give
retailers an incentive not to sell the products of smaller rivals or new entrants.” See Christine
A. Varney, A Post-Leegin Approach to Resale Price Maintenance Using a Structured Rule
of Reason, 24 Antitrust 22, 24 (2009).
It is not clear when or why the Commissioner would commence a proceeding under s. 76 as
opposed to other provisions of the Act. Where RPM is used to support manufacturer or re-
tailer cartels, the US Supreme Court’s first two circumstances, the Commissioner should be
expected to proceed under the criminal price-fixing provision of the Act (s. 45). There may
be limited circumstances in which section 76 would permit enforcement in cartel-like cir-
cumstances where s. 45 would not be applicable. Section 76 may not necessarily require the
Commissioner to establish an agreement between the horizontal competitors; only an agree-
ment between marketplace participants with vertical relationships. Where RPM is engaged in
by a dominant retailer or manufacturer, the US Supreme Court’s second two circumstances,
the Commissioner may proceed under the Act’s specific abuse of dominance provision (s.
79), although in that case an incentive to proceeding under the specific RPM provision (s.
76) may be the lower “adverse effects” competitive effects standard.
It is not clear that the price maintenance provision would apply to situations in which the
independent conduct of multiple suppliers could have adverse effects. Section 76 refers to
circumstances in which “a person” engages in price maintenance. In contrast, the abuse of
dominance provision specifically refers to circumstances involving “one or more persons”
(para. 79(1)(a)) and the tied selling and exclusive dealing provisions refer to circumstances
in which the impugned conduct is “engaged in by a major supplier [. . .] or because it is
widespread in a market” (subs. 77(2)). Subsections 33(2) and 3(1) of the Interpretation Act
state, “Words in the singular include the plural” and vice-versa unless a contrary intention
appears, but it is not clear whether these provisions would or would not effectively allow for
the application of s. 76 to circumstances in which “a person or persons” engaged in price
maintenance.
Subsection (2) provides that remedies available to the Tribunal include an order prohibiting a
respondent from engaging in price maintenance or requiring a respondent to accept a person
as a customer on its usual trade terms.
218
The relief set out in section 76 is discretionary in nature. In Commissioner of Competition v.

Visa Canada Corporation, 2013 Comp. Trib. 10 (Competition Trib.) at paras. 393ff, the
Tribunal concluded that “even if the requirements under section 76 had been met, this is not
a proper case to grant discretionary relief.” In that case, an order would have been “a blunt
instrument” and there would have been “technical hitches, unforeseen consequences, a need
for ongoing adjustment and stakeholder consultation.” In those circumstances, the proper
Act
solution to the concerns raised by the Commissioner would require a regulatory framework.
Subsection (5)
Subsection 76(5) prohibits any suggestion by a product’s producer or supplier of a minimum
resale price, unless that person makes it clear to the recipient that he is under no obligation to
accept the suggestion and will in no way suffer in his business relations with the person
making the suggestion or with any other person if he fails to accept the suggestion.
Subsection (6)
Under subsection 76(6), product suppliers (other than retailers) who publish advertisements
that discuss resale prices for their products are deemed to be influencing upward the price of
those products, unless the advertisement is clear that the product may be sold at a lower
price. Case law under the previous criminal provision established that no separate offence
was created by subsection 61(4) [now subs 76(6)] and that the Crown still had to establish
that the influencing of prices upward was made by agreement, threat, promise or like means.
Subsections (7), (9)

Subsections 76(7) and 76(9) establish several exceptions and defences to price maintenance.
Notably, subs. 76(9) stipulates that no order may be made where the customer of the supplier
was selling the products in question not to make profit but for the purposes of advertising or
attracting customers in the hope of selling them other products; or where the customer was
engaging in misleading advertising or not providing the level of servicing that purchasers of
the products might reasonably expect.
Only the last of these exceptions (insufficient service) goes to the heart of the traditional pro-
competitive economic theory that explains why an upstream supplier would want to impose
resale prices on a downstream distributor. Moreover, the exceptions only apply to circum-
stances where a customer has been cut off as a result of its low pricing policy pursuant to
sub-para. 76(1)(a)(ii) and cannot be used to justify a practice of resale price maintenance
where there has not been a refusal to supply. This provides an usual incentive to cut-off
resellers in order to take advantage of the exemption. Moreover, the limited range of these
exemptions means that certain pro-competitive justifications may not be available to suppli-
ers, although the Tribunal should be expected to assess the effect of any other pro-competi-
tive rationale for a practice of resale price maintenance as part of its assessment of adverse
effects.
Subsection (10)
Similar provisions are found in subs. 75(4) and subs. 77(7).
Subsection (11)
Subsection 76(11) specifically prohibits a price maintenance case from being brought in con-
junction with an abuse of dominance or price fixing/competitor collaboration case. This is to
be contrasted with the other reviewable practices of refusal to supply, tied selling and exclu-
219
sive dealing, which contain no such limitations. Indeed, a combined ss. 77 and 79 case
would not be unusual. Subsection 76(11) therefore requires the Commissioner to make a
determination as to whether to pursue a resale price maintenance case as form of abuse of
dominance under s. 79 or price-fixing/competitor collaboration under ss. 45, 49 or 90.1.
To date there has been only one s. 76 case. Certain case summaries under the former s. 61
have been provided here for reference.
Case Law
Safa Enterprises Inc. v. Imperial Tobacco Co., 2013 Comp. Trib. 19 — The applicant sought
leave to commence a s. 76 application against Imperial Tobacco for its preferred pricing
program. The applicant asserted that its exclusion from Imperial Tobacco’s low pricing pro-
gram had resulted in an adverse effect on its business because its direct competitor offered
Imperial Tobacco products at a lower price. The Competition Tribunal dismissed the appli-
cation because that the “low pricing policy” in s. 76(1)(a)(ii) refers to the pricing of the
applicant’s product, not those of the respondents.
The Commissioner of Competition v. Visa Canada Corporation, 2013 Comp. Trib. 10, 2013
CarswellNat 3285 (Competition Trib.) — The Commissioner brought an application against
Visa and MasterCard alleging that three rules imposed on their customers contravened sec-
tion 76. The three rules were: a No Surcharge Rule, prohibiting merchants from charging
credit card users more than the advertised price; an Honour All Cards Rule, requiring
merchants to accept all valid Visa or MasterCard cards; and (3) a No Discrimination Rule,
prohibiting merchants from discriminating against any MasterCard brand. The Tribunal dis-
missed the Commissioner’s application. Section 76 requires the resale of identical or sub-
stantially similar products. The respondents supplied authorization, clearance and settlement
of transaction services to acquirors over their respective networks (credit card network ser-
vices). The acquirors, on the other hand, provided merchants services that enabled them to
accept credit cards (credit card acceptance services). There is therefore no resale as these
services were different from those offered by Visa and MasterCard. The Tribunal continued
its analysis in the event that it was wrong with respect to the legal interpretation of section
76 or its finding that the resale requirement had not been met. As part of that analysis, it
concluded that the “influencing upward” requirement in paragraph 76(1)(a) must mean
something other than the consequences that flow from a company’s exercise of market
power which results in adverse effects on competition in the form of an increase in prices in
the downstream market. If not, section 76 would turn into an open-ended provision, with any
increased price resulting in an adverse effect on competition. The Tribunal ultimately found
that, in the absence of the No Surcharge Rule, either surcharging or the threat of it would
steer or threaten to steer credit card network transaction volume to other means of payment
and this would either constrain increases or bring about reductions in fees. Nonetheless, the
Tribunal held that, even if section 76 had been contravened, it was not a proper case to grant
discretionary relief and that the proper solution required a regulatory framework.
R. v. Royal LePage Real Estate Services Ltd. (1993), 12 Alta. L.R. (3d) 282, [1994] 1
W.W.R. 228, 50 C.P.R. (3d) 161, 105 D.L.R. (4th) 556, 143 A.R. 241 (Q.B.) — Subsection
61(1)(a) of the Act does not violate s. 7 of the Charter. The use of the words “or any like
means” does not create constitutional vagueness but, rather, introduces flexibility. That
phrase is capable of being interpreted by reference to the other specified types of conduct in
the paragraph. Private actions to influence the prices of another through complicity, duress
or inducement, or similar action, provides sufficient definition for informed legal debate. In
this context, the words are capable of judicial interpretation.
220
This same analysis applied to s. 61(1)(b). The use of the words “or otherwise discriminate”
does not create vagueness. The type of conduct that is prohibited is capable of definition;
that is, it covers acts of discrimination which are directed at other people because of their
low pricing policy. The generality provides for flexibility for the interpretive role of the
court, yet provides a risk zone capable of judicial definition.
Further, although both subsections do violate the freedom of expression provisions found in
Act
s. 2(b) of the Charter, this limitation can be demonstrably justified in a free and democratic
society in that the prohibition against price fixing is a valid and significant legislative objec-
tive, there is a rational connection between the provisions and this objective, and the provi-
sions are proportionate to this objective.
R. v. Must de Cartier Canada Inc. (1989), 45 B.L.R. 167, 27 C.P.R. (3d) 37 (Ont. Dist.
Ct.) — Not every attempt to influence upward or to discourage the reduction of the price is
an offence, only attempts made in a manner prohibited, that is “by agreement, threat, prom-
ise or any like means”. Hence, it is open to a distributor to try to persuade retailers not to
offer discount prices for a product in the interests of protecting the image of a trademark and
trade name.
R. v. Shell Canada Products Ltd. (1989), 24 C.P.R. (3d) 501 (Man. Q.B.); leave to appeal
refused (1990), 45 B.L.R. 231, 75 C.R. (3d) 365, 29 C.P.R. (3d) 32, 63 Man. R. (2d) 1
(C.A.) — Following telephone calls from a marketing representative of the accused, a re-
tailer under a readily terminable contract to purchase gas from the accused had raised its
price. The actions constituted a threat in that a reasonable person would fear alienating the
accused if its requests were not complied with. Accordingly, the accused was guilty of at-
tempting to influence prices upward by the use of a threat.
R. v. Sony of Canada Ltd. (1987), 16 C.P.R. (3d) 50 (Ont. Dist. Ct.) — It is not necessary
that price lists showing suggested list prices indicate that such prices are not mandatory. That
many retailers had for years sold the accused’s products at less than the suggested list price
is sufficient evidence that they were aware that such prices were not mandatory and that
retailers charging lower prices would not be punished by the accused.
R. v. North Sailing Products Ltd. (1987), 18 C.P.R. (3d) 497 (Ont. Dist. Ct.) — It is not an
offence under this section for a supplier to set the prices charged to retailers based on the
volume of purchases by such retailers. It is, however, an offence to charge higher prices to a
retailer on the basis that that retailer offers discount prices.
R. v. George Lanthier & Fils Ltée (1986), 12 C.P.R. (3d) 282 (Ont. Dist. Ct.); affirmed
(1988), 24 C.P.R. (3d) 288 (Ont. C.A.) — A retailer of the accused’s bread advised the ac-
cused that he wished to advertise the bread at a price below cost. The accused’s district
manager advised him that the accused could limit the supply of bread to him. This consti-
tuted a threat which was made in an attempt to discourage the price reduction, in violation of
s. 61(1)(a).
R. v. Griffith Saddlery & Leather Ltd. (1986), 14 C.P.R. (3d) 389 (Ont. Prov. Ct.) — Follow-
ing strenuous complaints by a long-standing customer, the defendant ceased supplying its
products to a riding and boarding stable that had been selling its products at a discount,
stating that it did not supply direct to consumers, riding schools, stables or blacksmiths but
only to retail outlets. The evidence did not establish beyond a reasonable doubt that the
reason for this decision was the stable’s low pricing policy and the charge was accordingly
dismissed.
R. v. Schelew (1984), 78 C.P.R. (2d) 102, 52 N.B.R. (2d) 142, 137 A.P.R. 142 (C.A.) —
Although providing rental accommodation may constitute “supplying a product”, attempts
by one landlord to persuade other landlords to increase rents by providing information, sta-
221
tistics and good management advice, in the absence of an agreement of sufficient magnitude
so as to restrict the freedom of other landlords to fix their own prices, was not an offence.
R. v. Andico Mfg. Ltd. (1983), 4 C.P.R. (3d) 476 (Man. Q.B.) — The accused, a distributor
of waterbeds, attempted to influence the price of its product upwards by threatening to cut
off supply to a dealer if it did not raise its price for the waterbeds, and thereby committed
offences under these subsections.
R. v. Philips Electronics Ltd. (1980), 30 O.R. (2d) 129, 11 B.L.R. 204, 53 C.P.R. (2d) 74, 55
C.C.C. (2d) 312, 116 D.L.R. (3d) 298; affirmed [1981] 2 S.C.R. 264, 59 C.P.R. (2d) 212, 62
C.C.C. (2d) 384, 126 D.L.R. (3d) 767 — The onus is on the Crown under subs. (1) to prove
both an attempt and that the attempt was made in a manner set forth. Unilateral advertising
constituting an attempt under subs. (1) is not an offence in the absence of an agreement,
threat or promise, “or any like means”. By amending the words “any other means whatso-
ever”, previously used, to read “any like means” [1974–75–76, c. 76, s. 18(1)] Parliament
intended to substantially restrict the type of attempts which constitute an offence. The con-
duct set out subs. (4) is not “any like means”. Subs. (4) rather removes the burden on the
Crown of showing that the conduct described in subs. (4) constitutes an attempt, thus requir-
ing the Crown to prove only the conduct and not intent.
R. v. William E. Coutts Co., [1968] 1 O.R. at 550, 52 C.P.R. 21, [1968] 2 C.C.C. at 222, 67
D.L.R. (2d) at 88; affirmed [1968] 1 O.R. at 564, 54 C.P.R. 60, [1968] 2 C.C.C. 221, 67
D.L.R. (2d) 87 (C.A.) — The accused’s refusal to sell cards to two retailers because they had
held one-cent sales of the accused’s cards on consecutive weeks was justified under this
section since there was uniformity and consistency for the term of each sale and the sales
were extensive. A practice need not be of indefinite duration. This section was intended to
provide a defence.
77. (1) Definitions — For the purposes of this section,

“exclusive dealing” means
(a) any practice whereby a supplier of a product, as a condition of supply-
ing the product to a customer, requires that customer to
(i) deal only or primarily in products supplied by or designated by
the supplier or the supplier’s nominee, or
(ii) refrain from dealing in a specified class or kind of product except
as supplied by the supplier or the nominee, and
(b) any practice whereby a supplier of a product induces a customer to
meet a condition set out in subparagraph (a)(i) or (ii) by offering to sup-
ply the product to the customer on more favourable terms or conditions if
the customer agrees to meet the conditions set out in either of those
subparagraphs;
“market restriction” means any practice whereby a supplier of a product, as a
condition of supplying the product to a customer, requires that customer to
supply any product only in a defined market, or exacts a penalty of any kind
from the customer if he supplies any product outside a defined market;
222
Part VIII — Reviewable Matters (ss.75-107) S. 77(3.1)
“tied selling” means

(a) any practice whereby a supplier of a product, as a condition of supply-
ing the product (the “tying” product) to a customer, requires that cus-
tomer to
(i) acquire any other product from the supplier or the supplier’s
Act
nominee, or
(ii) refrain from using or distributing, in conjunction with the tying
product, another product that is not of a brand or manufacture des-
ignated by the supplier or the nominee, and
(b) any practice whereby a supplier of a product induces a customer to
meet a condition set out in subparagraph (a)(i) or (ii) by offering to sup-
ply the tying product to the customer on more favourable terms or condi-
tions if the customer agrees to meet the condition set out in either of those
subparagraphs.
(2) Exclusive dealing and tied selling — Where, on application by the
Commissioner or a person granted leave under section 103.1, the Tribunal
finds that exclusive dealing or tied selling, because it is engaged in by a major
supplier of a product in a market or because it is widespread in a market, is
likely to
(a) impede entry into or expansion of a firm in a market,
(b) impede introduction of a product into or expansion of sales of a prod-
uct in a market, or
(c) have any other exclusionary effect in a market,
with the result that competition is or is likely to be lessened substantially, the
Tribunal may make an order directed to all or any of the suppliers against
whom an order is sought prohibiting them from continuing to engage in that
exclusive dealing or tied selling and containing any other requirement that, in
its opinion, is necessary to overcome the effects thereof in the market or to
restore or stimulate competition in the market.
(3) Market restriction — Where, on application by the Commissioner or a
person granted leave under section 103.1, the Tribunal finds that market re-
striction, because it is engaged in by a major supplier of a product or because
it is widespread in relation to a product, is likely to substantially lessen compe-
tition in relation to the product, the Tribunal may make an order directed to
all or any of the suppliers against whom an order is sought prohibiting them
from continuing to engage in market restriction and containing any other re-
quirement that, in its opinion, is necessary to restore or stimulate competition
in relation to the product.
(3.1) Damage awards — For greater certainty, the Tribunal may not make
an award of damages under this section to a person granted leave under sub-
section 103.1(7).
223
(4) Where no order to be made and limitation on application of

order — The Tribunal shall not make an order under this section where, in
its opinion,
(a) exclusive dealing or market restriction is or will be engaged in only for
a reasonable period of time to facilitate entry of a new supplier of a prod-
uct into a market or of a new product into a market,
(b) tied selling that is engaged in is reasonable having regard to the tech-
nological relationship between or among the products to which it applies,
or
(c) tied selling that is engaged in by a person in the business of lending
money is for the purpose of better securing loans made by that person
and is reasonably necessary for that purpose.
No order made under this section applies in respect of exclusive dealing, mar-
ket restriction or tied selling between or among entities that are affiliated.
(5) If entity affiliated — For the purposes of subsection (4), in addition to
the circumstances specified in paragraph 2(2)(a) or (b) under which two enti-
ties are affiliated, an entity is affiliated with another entity in respect of any
agreement between them in which one of them grants to the other the right to
use a trademark or trade name to identify the business of the grantee, if
(a) the business is related to the sale or distribution, in accordance with a
marketing plan or system prescribed substantially by the grantor, of a
multiplicity of products obtained from competing sources of supply and a
multiplicity of suppliers; and
(b) no one product dominates the business.
(6) When persons deemed to be affiliated — For the purposes of sub-
section (4) in its application to market restriction, where there is an agreement
whereby one person (the “first” person) supplies or causes to be supplied to
another person (the “second” person) an ingredient or ingredients that the sec-
ond person processes by the addition of labour and material into an article of
food or drink that he then sells in association with a trademark that the first
person owns or in respect of which the first person is a registered user, the
first person and the second person are deemed, in respect of the agreement, to
be affiliated.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, ss. 23, 37(y); 2002, c. 16, ss. 11.2,
11.3; 2014, c. 20, s. 366(1); 2018, c. 8, s. 113
Commentary
Section 77 establishes the reviewable practices of exclusive dealing, tied selling and market
restriction. These reviewable practices were first enacted in 1976, prior to the introduction of
224
the abuse of dominance provisions in 1986. These practices are all common commercial
activities that carry with them no opprobrium unless the strict requirements of section 77
have been satisfied. Section 77 applications are rarely brought before the Tribunal. Since
1986, two exclusive dealing cases (both brought in conjunction with abuse of dominance
applications), one tied selling case (Tele-direct) and no market restriction cases have been
considered on the merits by the Competition Tribunal.
Act
Exclusive dealing involves a situation in which a supplier requires or induces a customer to
agree to exclusivity. A situation in which a customer requires or induces a supplier to deal
exclusively with it may be an abuse of dominance. See paragraph 78(1)(h) of the Act.
Tied selling occurs where a supplier, as a condition of supplying one product (the tying
product), requires or induces a customer to purchase another product (the tied product). For
an inducement to constitute tied selling, there must be an element of coercion such that the
inducement essentially “forces” the customer to buy both.
Tied selling requires an assessment of whether there is one product or two. This usually
entails consideration of whether there is separate demand for the two alleged products and
whether it is efficient to bundle or sell the two products together (see paragraph 77(4)(b) of
the Act).
For a discussion of the difference between tying and bundling, see the commentary to sec-
tion 78.
Even where there has been exclusive dealing or tied selling, the Tribunal will not make an
order unless the following three conditions are met:
• The practice must be engaged in by a “major supplier” or because it is “widespread in a
market.” The “widespread in the market” requirement likely establishes a lower thresh-
old than “one or more persons” under section 79 because there is no need under section
77 to show market power. In other words, conduct can be widespread without being
engaged in by parties that collectively have market power whereas section 79 requires
that parties engaged in impugned conduct have market power.
• The practice must impede entry into or expansion of a firm, product or sales or have
another exclusionary effect.
• The practice must have, or be likely to, result in a substantial lessening of competition.
Market restriction is defined in subsection 77(1) as a practice whereby a supplier, as a condi-
tion of supplying a product to a customer, requires its customer to supply the product only in
defined markets, or extracts a penalty if the customer supplies the product outside of the
market.
The Tribunal may make an order in respect of a market restriction that it determines, because
it is engaged in by a major supplier of a product or because it is widespread in relation to a
product, is likely to substantially lessen competition in relation to the product.
Potential remedies in respect of exclusive dealing, tied selling and market restriction are
similar. If the substantive elements of one of the practices are proven, the Tribunal may
make an order prohibiting the supplier from engaging in the practice and “containing any
other requirement that, in [the Tribunal’s] opinion, is necessary to restore or stimulate com-
petition in relation to the product”. Note that there are a number of exemptions in subsection
77(4).
The Competition Bureau will not necessarily analyse exclusive dealing, tied selling or mar-
ket restriction solely under section 77: a Bureau inquiry may also consider whether there has
been an abuse of dominance under section 79. The distinction is important because adminis-
225
trative monetary penalties of $10 million to $15 million can be imposed by the Tribunal in
cases of abuse of dominance.
See also J. W. Rowley QC and A. N. Campbell, Vertical Non-Price Restraints, Insight Com-
petition Law Conference (May 1993).
Case Law
Canada (Commissioner of Competition) v. Canada Pipe Co., 2007 CarswellNat 3913 (Com-
petition Trib.) — This case involved the re-determination of the remaining elements to be
established to secure a remedy under s. 77. The respondent’s Stock Distributor Program
(SDP) constituted a practice of exclusive dealing for the purpose of s. 77 and the respondent
was previously prohibited from engaging in the SDP or any similar conduct. The evidence
established that the SDP had impeded entry and expansion of competing firms in the relevant
markets and that, but for the SDP, all of the relevant markets would have likely benefited
from substantially greater competition, including lower prices, increased switching between
competing suppliers and substantially more entry and expansion by competitors.
Canada (Commissioner of Competition) v. Canada Pipe Co., 2006 CarswellNat 1763, 2006
FCA 233, 49 C.P.R. (4th) 241 (F.C.A.); reversing 40 C.P.R. (4th) 453, 2005 CarswellNat
2348, 2005 Comp. Trib. 3 (Competition Trib.)) — The Commissioner applied for an order
under ss. 77 and 79 concerning alleged exclusive dealing and abuse of dominant position by
the company. The Commissioner alleged that the company’s Stocking Distributor Program
(SDP) was a practice of exclusive dealing under s. 77 of the Act. The SDP was a rebate
program whereby distributors of plumbing products in Canada received substantial discounts
in return for being supplied in cast iron drain, waste and vent (DWV) products exclusively
by a wholly-owned subsidiary of the company. The Tribunal found, under s. 79 of the Act,
that the company did substantially control the class of business comprising cast iron DWV
products in six areas in Canada. However, the Tribunal found that for a loyalty program such
as the SDP to be anti-competitive, the switching costs must prevent buyers from changing
suppliers. The Tribunal concluded that the SDP was not itself anti-competitive as its pres-
ence had not deterred entry by foreign and domestic suppliers, and its structure allowed cus-
tomers to leave SDP without incurring significant switching costs. The greatest savings to
customers came from the discounts applied at the point of purchase rather than the quarterly
or annual rebates. Accordingly, the Tribunal did not find that the SDP was a practice of anti-
competitive acts, nor did the Tribunal find that the SDP had substantially lessened or pre-
vented competition.
The Commissioner appealed from the decision of the Competition Tribunal, and the appeal
was allowed, with the matter referred back to the Tribunal for a re-determination. The Fed-
eral Court of Appeal found that the Tribunal did not apply the correct legal tests with respect
to the application of the abuse of dominance provisions. In particular, the Court ruled that
the Tribunal misapplied the legal test with respect to the requirements of (a) an “anticompeti-
tive act” and (b) “a substantial lessening or prevention of competition”. In regard to an an-
ticompetitive act, it must have an intended negative effect on a competitor that was preda-
tory, exclusionary or disciplinary. On the second issue, the Court reformulated the
substantial lessening of competition test to ask whether the relevant markets would be sub-
stantially more competitive but for the impugned practice of anti-competitive acts. This was
referred to as a “but for” test. In order to establish dominance in a market, both of these
elements must be shown before an order can be made. The Tribunal had erred in focusing on
whether there continued to be a substantial level of competition, rather than whether an im-
pugned practice had resulted, or will likely result, in a substantial prevention or lessening of
competition.
226
Manos Foods International Inc. v. Coca-Cola Ltd. (1999), 2 C.P.R. (4th) 283, 125 O.A.C.
66, 180 D.L.R. (4th) 309, 40 C.P.C. (4th) 113 (Ont. C.A.) — See entry under s. 75.
Canada (Director of Investigation & Research) v. Tele-Direct (Publications) Inc. (1997), 73
C.P.R. (3d) 1 (Competition Trib.) — The business provided both advertising in a published
directory and advertising services which included locating customers, selling space and pro-
viding advice and information to customers on the placement of directory advertising. The
Act
Tribunal found that the two aspects of the business constituted a single product for small
advertisers, who were less likely to seek out services separate from the provider of the adver-
tising space. The conditions of coercion for purposes of tied selling were not restricted to
contractual terms, and included economic conditions effectively precluding choice. The Tri-
bunal ordered the unbundling of the tying product, advertising space, from the tied product,
advertising services, in certain markets.
Polaroid Canada Inc. v. Continent-Wide Enterprises Ltd. (1994), 18 B.L.R. (2d) 294, 59
C.P.R. (3d) 257 (Ont. Gen. Div.) — The plaintiff distributed photographic products to deal-
ers for resale and further distribution. The defendant purchased products for distribution. The
plaintiff was concerned that its goods purchased in Canada were being exported for resale
outside established distribution systems. Accordingly, the plaintiff implemented an export
pricing policy and established a price list. The plaintiff confirmed its suspicions that the
defendant was carrying on that export and resale practice. The plaintiff then notified the
defendant that it intended to enforce the terms of sale entitling it to receive goods for export,
and requested a deposit equalling the difference between the domestic price and the applica-
tion export for 85 per cent of the goods ordered since the new price list had been put in
place. The plaintiff then terminated the defendant’s status as an authorized dealer. The plain-
tiff’s action for breach of contract was allowed while the defendant’s counter-claim for
breach of contract and breach of the Act was dismissed.
While the export policy may have been a market restriction under s. 77, only market restric-
tions enjoined by the Tribunal are illegal and inconsistent with the public trust.
Harbord Insurance Services Ltd. v. Insurance Corp. of British Columbia (1993), 13 C.C.L.I.
(2d) 262, 9 B.L.R. (2d) 81 (B.C. S.C.) — The conduct described in s. 77 of the Act will not
support the tort of unlawful interference with economic relations. For a claim based on the
tort to succeed, the interference complained of must be unlawful and the conduct covered by
the section cannot be characterized as such. Exclusive dealing and tied selling are only un-
lawful when the Competition Tribunal has issued an order against a particular person prohib-
iting such conduct. In the absence of such order the conduct is lawful.
(Comp. Trib.) — See entry under s. 79.
Dir. of Investigation & Research v. Broadcast News Ltd. (1986), 9 C.P.R. (3d) 429 (R.T.P.
Comm.) — Until the hearing commences, the Director is entitled to withdraw an application
for an inquiry by the Commission and the Commission is without jurisdiction to review that
decision.
Comm.) — See entry under Competition Tribunal Act, s. 9.
BBM Bureau of Measurement v. Dir. of Investigation & Research, [1985] 1 F.C. 173, 82
C.P.R. (2d) 60, 12 C.C.C. (3d) 560, 9 D.L.R. (4th) 600, 52 N.R. 137 (C.A.) — The accused
supplied radio and television viewing data to advertising agencies on the basis of charging a
substantial membership fee, plus a small additional fee for either radio or television reports,
or both. This placed its only competition in the television market at a severe competitive
disadvantage, and was likely to impede entry of a firm into the radio data market. The ac-
227
cused was therefore by order of the Restrictive Trade Practices Commission prohibited from
continuing to engage in tied selling of both radio and television audience measurement ser-
vices. The accused brought an application to have the order reviewed and set aside on the
grounds that this section was ultra vires Parliament. The application was dismissed. This
section meets all the criteria set out in Citizens Ins. Co. of Can. v. Parsons (1881), 7 App.
Cas. 96, for establishing legislation which is concerned with matters of general interest
throughout Canada. Read in context with the other provisions of the Act, it is clearly part of
a complex regulatory scheme, aimed not at a particular business or industry but at the gen-
eral regulation of trade and commerce throughout Canada for the benefit of Canadians in
general. It is accordingly valid federal legislation.
Dir. of Investigation & Research v. Bombardier Ltd. (1980), 53 C.P.R. (2d) 47 (R.T.P.
Comm.) — A “major” or important supplier is one whose actions are taken to have an appre-
ciable or significant impact on the markets where it sells. A firm’s market share is a good
indication of its importance. Its financial strength and record as an innovator are also rele-
vant. Various market levels may be considered, including manufacturing, distribution and
retail.
78. (1) Definition of “anti-competitive act” — For the purposes of sec-

tion 79, “anti-competitive act”, without restricting the generality of the term,
includes any of the following acts:
(a) squeezing, by a vertically integrated supplier, of the margin available
to an unintegrated customer who competes with the supplier, for the pur-
pose of impeding or preventing the customer’s entry into, or expansion in,
a market;
(b) acquisition by a supplier of a customer who would otherwise be avail-
able to a competitor of the supplier, or acquisition by a customer of a
supplier who would otherwise be available to a competitor of the cus-
tomer, for the purpose of impeding or preventing the competitor’s entry
into, or eliminating the competitor from, a market;
(c) freight equalization on the plant of a competitor for the purpose of
impeding or preventing the competitor’s entry into, or eliminating the
competitor from, a market;
(d) use of fighting brands introduced selectively on a temporary basis to
discipline or eliminate a competitor;
(e) pre-emption of scarce facilities or resources required by a competitor
for the operation of a business, with the object of withholding the facilities
or resources from a market;
(f) buying up of products to prevent the erosion of existing price levels;
(g) adoption of product specifications that are incompatible with products
produced by any other person and are designed to prevent his entry into,
or to eliminate him from, a market;
228
(h) requiring or inducing a supplier to sell only or primarily to certain

customers, or to refrain from selling to a competitor, with the object of
preventing a competitor’s entry into, or expansion in, a market; and
(i) selling articles at a price lower than the acquisition cost for the purpose
of disciplining or eliminating a competitor.
Act
(j) [Repealed 2009, c. 2, s. 427(1).]
(k) [Repealed 2009, c. 2, s. 427(1).]
(2) [Repealed 2009, c. 2, s. 427(2).]
Commentary
Section 78 contains a non-exhaustive list of anti-competitive acts for the purposes of
paragrpah 79(1)(b). Decided cases have cited paragraphs 78(1)(e), (h) and (i) but often in-
volve conduct not specifically identified in section 78. Additional anti-competitive acts iden-
tified by the Competition Tribunal or Commissioner of Competition (in settled cases)
include:
• Acquiring numerous competitors and including over-broad non-compete clauses in the
acquisition agreements for the purpose of initially acquiring a monopolistic position in
the market and then eliminating competitors from those markets (Laidlaw);
• Intimidating competitors and customers through actual or threatened litigation, includ-
ing nuisance litigation, to discourage customers from switching to competing suppliers
and to discourage competitors from seeking new customers (Laidlaw); and
• Entering into agreements that impose additional costs on customers who choose to
switch to a competitor for the purpose of excluding competitors from entering into or
expanding in a market (Enbridge; Laidlaw; Nielsen).
The Tribunal and courts have made it clear that any act that is “exclusive, disciplinary, or
predatory” could be an anti-competitive act and, in practice, the first step in assessing
whether conduct could be anti-competitive is to consider whether it is “exclusive, discipli-
nary, or predatory” rather than formalistically reviewing the list of acts in section 78 or in
cases. That said, a review of cases initiated by the Competition Bureau provides a useful
indication of areas of concern and enforcement priority. Historically, the Bureau has tended
to focus on exclusivity arrangements that limit the ability of competitors to enter into or
expand in a market (see, e.g., Canada Pipe; CANYPS; Enbridge; Heinz; ICBC; Interac;
Laidlaw; Nielsen; NutraSweet).
Paragraph (a) refers to a classical price squeeze whereby vertically integrated firms at, for
example, the manufacturing and distributing level of operations “squeeze” independent dis-
tributors so as to undercut the independent firm at the distributing level with consequential
anti-competitive effects. The “squeeze” may arise from either an artificially high price to the
independent distributors or from artificially low prices by the vertically integrated firm at the
retail level.
Paragraph 78(1)(b) refers to a form of vertical integration forward or backward wherein cus-
tomers or suppliers may be “foreclosed” from competitors. As with paragraph 78(1)(a), such
conduct must be engaged in for anti-competitive purposes.
Paragraph 78(1)(c) refers to the concept of meeting a competitor’s delivered price quotations
even where the competitor is closer to the buyer. Again there must be anti-competitive in-
229
tent. This could be difficult to prove where the freight equalizer alleges that it is simply
acting competitively in seeking additional business.
The “fighting brands” referred to in paragraph 78(1)(d) are brands of goods marketed with a
predatory intent. The brands must be introduced “selectively” and “on a temporary basis”.
Thus if a brand was not originally introduced as a fighting brand but was later changed for
that purpose, it would not meet the criteria of the paragraph.
The “pre-emption of scarce facilities or resources” in paragraph 78(1)(e) must be for the
purpose of withholding them from the market. Presumably, if the resources or facilities are
actually used in ordinary business operations, then even though there may be an anti-compet-
itive effect, the necessary “object” would not be present. An illustration of the application of
the paragraph would be where a scarce resource was bought to foreclose a competitor’s
purchase and then not used.
In Canada Pipe, the Federal Court of Appeal concluded that for an act to be anticompetitive,
it must be directed at a competitor of the person who is the target of the Commissioner’s
application. In 2014, this interpretation was reversed by the Federal Court of Appeal in
TREB, noting that unlike other paragraphs, paragraph 78(1)(f) does not contain an explicit
reference to a purpose vis-à-vis a competitor. Accordingly, the Court concluded that para-
graph 78(1)(f) is an indication that Parliament did not intend the scope of subsection 79(1) to
be limited in such a way that it could not apply to, for instance, a trade organization that does
not directly compete with its members. In a 2016 redetermination hearing, the Competition
Tribunal concluded that TREB had breached the abuse of dominance provision as a result of
restrictive rules imposed on a subset of innovative realtors.
An example of the conduct referred to in paragraph 78(1)(g) would be a franchise agreement
in which the product specifications given to the franchisee are delineated in such a way that
only the franchisor or the franchisor’s designate could possibly meet them. Similarly, leases
of certain business machines or equipment might specify products to be used in conjunction
with such machines or equipment that could in practice be supplied only by the lessor. Be-
cause the giving of detailed product specifications with attendant foreclosure effects can be
legitimate business behaviour, there is the requirement that the conduct be “designed” to
have the foreclosure effect mentioned in this paragraph.
Paragraph 78(1)(h) relates to exclusivity arrangements imposed by (dominant) customers on
(upstream) suppliers. This is the opposite of exlusive dealing in section 77, which relates to
exclusivity arrangements imposed by suppliers on customers. Although paragraph 79(1)(h)
refers to influencing “a supplier”, that is, one supplier, it would likely be difficult as a practi-
cal matter to establish that conduct was truly exclusionary if it were possible for customers
to source from other suppliers. The one case in which section 78(1)(h) has been judicially
considered, Neilsen, involved a series of exclusive contracts with all the major suppliers in a
market: see Canada (Director of Investigation & Research) v. D & B Co. of Canada Ltd.
(1995), 64 C.P.R. (3d) 216 (Competition Trib.). However, a number of section 79 abuse of
dominance cases have involved exclusivity arrangements imposed by suppliers on custom-
ers. Although those cases also involved section 77 claims, it is clear that supplier-imposed
exclusivity can consititute and anti-competitive act for the purpose of section 79. See:
Canada (Director of Investigation & Research) v. NutraSweet Co. (1990), 32 C.P.R. (3d) 1
(Competition Trib.) and Canada (Commissioner of Competition) v. Canada Pipe Co. (2005),
40 C.P.R. (4th) 453 (Competition Trib.); reversed 2006 CarswellNat 1762, 2006 Car-
swellNat 3352 (F.C.A.); leave to appeal refused 2007 CarswellNat 1107, 2007 CarswellNat
1108 (S.C.C.); reversed 2006 CarswellNat 4554, 2006 CarswellNat 1763 (F.C.A.).
230
Paragraph 78(1)(i) refers to predatory pricing. Selling at or below acquisition cost may be
legitimate where the market value of the goods has declined below cost or where the goods
are being sold at a loss as a promotion to induce customers to buy other goods, that is, loss-
leaders. In order for below cost selling to fall within the definition, it must be done “for the
purpose of disciplining or eliminating a competitor”. The Tribunal has considered paragraph
78(1)(i) in only one case, Canada (Director of Investigation & Research) v. NutraSweet Co.
Act
(1990), 32 C.P.R. (3d) 1 (Competition Trib.). In that case, while a specific finding on selling
below cost was not required in respect of any potential remedy, the Tribunal observed that
acquisition cost does not easily lend itself to manufacturing scenarios and made it clear that
predatory pricing can be an anti-competitive act regardless of whether it fits squarely within
the parameters of paragraph 78(1)(i) (or paragraphs 78(1)(c) or (d), which also address pred-
atory conduct).
The Bureau considers predatory pricing to occur when a company deliberately sets prices
below costs to incur losses for a sufficiently long period of time for the purpose of eliminat-
ing, disciplining, or deterring entry by a competitor, in the expectation that the company will
subsequently be able to recoup its losses by charging prices above the level that would have
prevailed in the absence of the impugned conduct, with the effect that competition would be
substantially lessened or prevented. The Bureau’s Predatory Pricing Enforcement Guide-
lines set out the Commissioner’s general approach to predation under section 79 of the Act:
see Predatory Pricing Enforcement Guidelines (Ottawa: Competition Bureau, July 2008).
The predation assessment involves a cost-revenue analysis to determine whether prices are
below average avoidable costs. Avoidable cost refers to the costs that a firm could have
avoided had it chosen not to sell the product(s) in question during the period of time the
policy was in place. Variable costs and product-specific fixed costs are relevant to the avoid-
able cost calculation; however, sunk costs and fixed costs (other than those which are prod-
uct-specific) are not. The Tribunal has judicially considered the avoidable costs standard in
one case, Commissioner of Competition v. Air Canada, 2003 Comp. Trib. 13 (Competition
Trib.), which involved paragraph 78(1)(j) of the Act, which has since been repealed.
Additional information on the Competition Bureau’s approach to the enforcement of the
abuse of dominance provisions of the Act may be found in the Abuse of Dominance Enforce-
ment Guidelines (Ottawa: Competition Bureau, March 2019).
Another type of conduct known as “bundling” — which is similar to, but distinct from, tied
selling — has been identified by the Competition Bureau as potentially abusive. Unlike tied
selling, there is no statutory definition of bundling in the Act. Bundling occurs where dis-
counts or rebates are based on a buyer’s purchase of two or more different products or ser-
vices. Unlike tied selling, bundled discounts do not prevent buyers from purchasing indivi-
dual products separately, although the aggregate price of the products purchased separately
is typically higher than the price of the product bundle.
The Competition Bureau identifies three types of bundling: (i) pure bundling (i.e., where a
firm requires a buyer to purchase more than one product in fixed amounts or proportions);
(ii) mixed bundling (i.e., where buyers have the option of purchasing the individual products
separately, but can also purchase them bundled on more favourable terms); and (iii) bundling
discounts or rebates (i.e., where a firm offers a better discount on one product, the “monop-
oly product,” if that buyer also purchases “all or a specified share” of the competitive prod-
uct to qualify for a discount on the monopoly product).
Bundling, assuming it is intended to exclude a competitor, can be problematic in two main
ways: (i) by discounting and bundling two or more products, bundling may constitute preda-
tory conduct; or (ii) to the extent that bundling by a dominant player anti-competitively
231
raises the costs of non-bundling competitors, it could make it uneconomic for them to com-
pete in the market for standalone products, thereby harming competition.
With respect to predatory conduct, the Bureau’s concern is that a bundling firm could cut
bundled prices below cost in order to drive out competitors, and where there are barriers to
entry, later recoup any losses by raising prices once there is no competition. Where a bundle
is properly characterized as a separate product market, the Competition Bureau will deter-
mine whether the bundle, as a single product, is being sold below its average avoidable cost.
Avoidable costs refer to all costs that could have been avoided by a firm had it chosen not to
sell those products during the relevant period.
The exclusionary or disciplinary effect of bundling potentially arises when competitors of
the bundling firm are unable to offer the same bundle (i.e., where the component products of
the bundle comprise separate product markets), making it more difficult for non-bundling
firms to compete. In such circumstances, the Competition Bureau will examine the extent to
which this can effectively exclude competitors by anti-competitively raising their costs.
For the most comprehensive discussion of the Bureau’s approach to bundling, see: the Bu-
reau’s 2009 submission to the International Competition Network’s Unilateral Conduct
Working Group on Tying and Bundled Discounting available at
<www.internationalcompetitionnetwork.org/uploads/questionnaires/uc%20tying/canada.pdf>.
79. (1) Prohibition where abuse of dominant position — Where, on

application by the Commissioner, the Tribunal finds that
(a) one or more persons substantially or completely control, throughout
Canada or any area thereof, a class or species of business,
(b) that person or those persons have engaged in or are engaging in a
practice of anti-competitive acts, and
(c) the practice has had, is having or is likely to have the effect of prevent-
ing or lessening competition substantially in a market,
the Tribunal may make an order prohibiting all or any of those persons from
engaging in that practice.
(2) Additional or alternative order — Where, on an application under
subsection (1), the Tribunal finds that a practice of anti-competitive acts has
had or is having the effect of preventing or lessening competition substantially
in a market and that an order under subsection (1) is not likely to restore
competition in that market, the Tribunal may, in addition to or in lieu of mak-
ing an order under subsection (1), make an order directing any or all the per-
sons against whom an order is sought to take such actions, including the di-
vestiture of assets or shares, as are reasonable and as are necessary to
overcome the effects of the practice in that market.
(3) Limitation — In making an order under subsection (2), the Tribunal
shall make the order in such terms as will in its opinion interfere with the
rights of any person to whom the order is directed or any other person af-
fected by it only to the extent necessary to achieve the purpose of the order.
(3.1) Administrative monetary penalty — If the Tribunal makes an or-
der against a person under subsection (1) or (2), it may also order them to pay,
232
Part VIII — Reviewable Matters (ss.75-107) S. 79(7)(b)
in any manner that the Tribunal specifies, an administrative monetary penalty

in an amount not exceeding $10,000,000 and, for each subsequent order under
either of those subsections, an amount not exceeding $15,000,000.
(3.2) Aggravating or mitigating factors — In determining the amount of
an administrative monetary penalty, the Tribunal shall take into account any
Act
evidence of the following:
(a) the effect on competition in the relevant market;
(b) the gross revenue from sales affected by the practice;
(c) any actual or anticipated profits affected by the practice;
(d) the financial position of the person against whom the order is made;
(e) the history of compliance with this Act by the person against whom the
order is made; and
(f) any other relevant factor.
(3.3) Purpose of order — The purpose of an order made against a person
under subsection (3.1) is to promote practices by that person that are in con-
formity with the purposes of this section and not to punish that person.
(4) Superior competitive performance — In determining, for the pur-
poses of subsection (1), whether a practice has had, is having or is likely to
have the effect of preventing or lessening competition substantially in a mar-
ket, the Tribunal shall consider whether the practice is a result of superior
competitive performance.
(5) Exception — For the purpose of this section, an act engaged in pursuant
only to the exercise of any right or enjoyment of any interest derived under the
Copyright Act, Industrial Design Act, Integrated Circuit Topography Act, Patent
Act, Trademarks Act or any other Act of Parliament pertaining to intellectual
or industrial property is not an anti-competitive act.
(6) Limitation period — No application may be made under this section in
respect of a practice of anti-competitive acts more than three years after the
practice has ceased.
(7) Where proceedings commenced under section 45, 49, 76, 90.1
or 92 — No application may be made under this section against a person on
basis of which
45 or 49; or
(b) an order against that person is sought by the Commissioner under
section 76, 90.1 or 92.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1990, c. 37, s. 31; 1999, c. 2, s. 37(z); 2002, c. 16,
s. 11.4; 2009, c. 2, s. 428; 2014, c. 20, s. 366(1)
233
Commentary
Subsection (1)
This subsection was enacted in 1986 and establishes the reviewable practice of abuse of
dominant position. It replaced the previous criminal offence of being a party to the formation
of a monopoly.
Subsection 79(1) authorizes the Commissioner of Competition to apply to the Competition
Tribunal for a remedial order where the Tribunal finds that the three conditions in paragraphs
79(1)(a), (b) and (c) are satisfied.
First, paragraph 79(1)(a) requires that one or more persons must substantially or completely
control a class or species of business. In the TREB, case, it was confirmed that the words
“substantially or completely control” are synonymous with market power. The degree of
market power required is higher than the degree of increased or maintained market power
generally required to demonstrate a substantial prevention or lessening of competition under
paragraph 79(1)(c). The Competition Tribunal confirmed its prior observation in Laidlaw
that no prima facie finding of dominance would arise when it is determined that the respon-
dent’s share of the relevant market is below 50%.
In the Competition Tribunal’s view, a substantial degree of market power is a degree of
market power that confers upon an entity considerable latitude to determine or influence
price or non-price dimensions of competition in a market, including the terms upon which it
or others carry on business in the market. Market power can be measured either directly or
indirectly. The direct approach focuses upon whether profits are indicative of substantial
market power. The indirect approach considers other indicia such as market share, entry
barriers or the countervailing power of customers.
The Abuse of Dominance Enforcement Guidelines state that the Bureau will utilize market
shares both as “safe harbours” and as indicators of likely market power. Market shares of
less than 50% (or 65% in a joint dominance case) will generally be considered as indicating
the absence of market power or dominance, unless other evidence indicates that the firm(s)
possess(es) a substantial degree of market power or that it appears the firm(s) is likely to
realize the ability to exercise a substantial degree of market power through the alleged anti-
competitive conduct within a reasonable period of time while that conduct is ongoing, while
market shares above this level will normally prompt further examination. All section 79 de-
cisions to date have concerned respondents that held more than 80% of relevant markets.
However, the Tribunal has observed in a section 76 case that while it is true that market
shares under 35% “do not normally raise unilateral market power concerns, this does not
mean that they can never do so.” In that case, there was a differentiated product market in
which one duopolist, Visa, had two-thirds of the market, with MasterCard holding the bal-
ance. “Taking into account MasterCard’s pricing discretion, its margins and the very high
barriers to entry,” the Tribunal concluded that MasterCard, as well as Visa, had market
power in the relevant market. See Commissioner of Competition v. Visa Canada Corpora-
tion, 2013 Comp. Trib. 10 (Competition Trib.) at paras. 260 and 267.
The reference to “one or more persons” permits the Tribunal to determine that there is “joint
dominance”, where two or more unaffiliated firms collectively possess market power. There
have been three joint dominance cases: Canada (Director of Investigation & Research) v.
Bank of Montreal (1996), 68 C.P.R. (3d) 527 (Competition Trib.); Canada (Director of
Investigation & Research) v. AGT Directory Ltd. (1994), [1994] C.C.T.D. No. 24, 1994 Car-
swellNat 3198 (Competition Trib.); Canada (Commissioner of Competition) v. Canadian
Waste Services Holdings Inc. (June 16, 2009), CT-2009-003 (Competition Trib.) (see also
the Competition Bureau press release “Competition Bureau Cracks Down on Joint Abuse of
234
Dominance by Waste Companies” Ottawa, 16 June 2009). All of these cases were resolved
on consent. In the Waste Services case, the Bureau appeared to have concluded that there
was joint dominance in the absence of any explicit coordination, agreement or understanding
between the parties. Previously, the Bureau had taken the view that more than consciously
parallel conduct would be required to establish joint dominance. The current position of the
Bureau is open to debate, in part because section 79, unlike section 77, does not expressly
Act
apply simply where conduct is “widespread in a market”.
Second, paragraph 79(1)(b) requires that the person or persons with market power must have
engaged in or be engaging in a practice of anti-competitive acts. Section 78 contains a non-
exhaustive list of anti-competitive acts. In the Canada Pipe case, the Federal Court of Ap-
peal stated that “an anti-competitive act is one whose purpose is an intended negative effect
[on a competitor] that is predatory, exclusionary or disciplinary.” In the subsequent TREB
case, the Federal Court of Appeal determined that it did “not interpret Canada Pipe to mean
that as a matter of law, a person who does not compete in a particular market can never be
found to have committed an anti-competitive act against competitors in the market.” This
reinterpretation was applied by the Competition Tribunal in the TREB redetermination hear-
ing, finding that TREB had abused its dominant position in the market for the supply of
residential real estate brokerage services in the GTA even though it did not directly compete
against its members in that market. As a result, it is now settled law that an anticompetitive
act must have an exclusionary, predatory or disciplinary effect, but that effect need not nec-
essarily be on a competitor of the dominant person engaged in the act. Proof of an intended
negative effect can be established “directly through evidence of subjective intent, or indi-
rectly by reference to the reasonably foreseeable consequences of the acts themselves and
the circumstances surrounding their commission, or both.” Business justifications are an im-
portant factor to be considered in determining the overall purpose of a practice. In the 2016
TREB redetermination hearing, the Competition Tribunal concluded that to be considered
“legitimate” in the context of paragraph 79(1)(b), a business justification must involve more
than a respondent’s self-interest. Rather, it “must be a credible efficiency or pro-competitive
rationale for the conduct in question, attributable to the respondent, which relates to and
counterbalances the anti-competitive effects and/or subjective intent of the acts” (citing the
Federal Court of Appeal decision, Canada Pipe). The business justification must also be
independent of the anti-competitive effect of the practice concerned. In The Commissioner of
Competition v. Vancouver Airport Authority, 2019 Comp. Trib. 6, the Vancouver Airport
Authority’s (VAA’s) justification for limiting the number of in-flight caterers to operate at
the Vancouver International Airport — protecting the continued viability of the operations
of the two existing catering firms as losing either caterer would be disruptive to the airport’s
operations — was found to be more important in the VAA’s decision-making process than
any subjective or deemed anti-competitive intent, or any reasonably foreseeable anti-compet-
itive effects of its conduct. There may also be legal considerations, such as privacy laws, that
legitimately justify an impugned practice, provided that the evidence supports that the im-
pugned conduct was primarily motivated by such considerations. See also the Commentary
to para. 78(1)(f).
Third, paragraph 79(1)(c) requires that the practice of anti-competitive acts must have had,
be having, or be likely to have the effect of preventing or lessening competition substantially
in a market. In Canada Pipe, the Federal Court of Appeal stated that this analysis requires a
comparative assessment of competitiveness in a market with and without the impugned prac-
tice of anti-competitive acts. If the market would have been substantially more competitive
(in the past, present or future) in the absence of the anti-competitive practice, there has been
a substantial lessening of competition. In November 2016, the Competition Bureau an-
nounced that it closed its investigation into allegations of anticompetitive conduct by TMX
235
Group related to securities market data. Aequitas, a competitor, announced plans to launch a
lower priced, consolidated market data product for traders. However the company alleged
that some of the clauses that are contained in contracts between TMX Group and investment
dealers prevent the dealers from sharing private market data with third parties such as Ae-
quitas, without the express written consent of TMX Group. The Competition Bureau con-
cluded that even absent TMX Group’s contractual clauses, it was unlikely that Aequitas
would be able to obtain a sufficient volume of private market data from investment dealers
to develop a sufficiently competitive product. Accordingly, the alleged anti-competitive con-
tractual clauses were not likely to have the effect of preventing competition substantially in a
market by preventing entry by Aequitas.
See also Appendix II of the Enforcement Guidelines on the Abuse of Dominance Provisions
(Ottawa: Competition Bureau, July 2001) for an overview of the interpretation of words and
phrases in section 79 that have been established by case law. The revised Abuse of Domi-
nance Enforcement Guidelines (Ottawa: Competition Bureau, March 2019) provide illustra-
tive examples of dominant behaviour at section 5.
Where there has been an abuse of dominance, the Tribunal may make an order prohibiting
all or any of those persons from engaging in that practice. Subsection 79(2) permits the
Tribunal to additionally or alternatively order any other remedial action, including divesti-
ture, necessary to overcome the abuse of dominance. Further, where an order is issued under
subsections 79(1) or 79(2), subsection 79(3.1) grants the Tribunal the discretion to also re-
quire that the person or persons subject to the order pay an administrative monetary penalty
not exceeding $10 million (or $15 million in the case of subsequent orders).
The Tribunal has rendered eight abuse of dominance decisions: Canada (Director of
Investigation & Research) v. NutraSweet Co. (1990), 32 C.P.R. (3d) 1 (Competition Trib.);
Canada (Director of Investigation & Research) v. Laidlaw Waste Systems Ltd. (1992), 40
C.P.R. (3d) 289 (Competition Trib.); Canada (Director of Investigation & Research) v. Tele-
Direct (Publications) Inc. (1997), 73 C.P.R. (3d) 1 (Competition Trib.); Canada (Director of
Investigation & Research) v. D & B Co. of Canada Ltd. (1995), 64 C.P.R. (3d) 216 (Compe-
tition Trib.); Canada (Commissioner of Competition) v. Air Canada (2003), 26 C.P.R. (4th)
476 (Competition Trib.); Canada (Commissioner of Competition) v. Canada Pipe Co.
(2005), 40 C.P.R. (4th) 453 (Competition Trib.); and Commissioner of Competition v.
Toronto Real Estate Board (2016), 2016 CarswellNat 1506, 2016 Comp. Trib. 7; and The
Commissioner of Competition v. Vancouver Airport Authority, 2019 Comp. Trib. 6. In addi-
tion, there have been several cases settled on consent.
The Bureau has also issued Technical Backgrounders or Position Statements in several abuse
of dominance cases in which inquiries were discontinued. See Competition Bureau, Techni-
cal Backgrounder, “Competition Bureau Concludes Examination into ICBC Policies” (19
August 2008); Competition Bureau, Technical Backgrounder, “Competition Bureau Con-
cludes Examination into National Hockey League Franchise Ownership Transfer and Relo-
cation Policies” (31 March 2008); Competition Bureau, Position Statement, “Competition
Bureau Statement Regarding NHL/Rogers Broadcasting Rights Agreement” (28 October
2015); Competition Bureau, Position Statement, “Competition Bureau Statement Regarding
its Investigation into Alleged Anti-Competitive Conduct by Google” (19 April 2016); Com-
petition Bureau, Position Statement, “Competition Bureau Statement Regarding its Investi-
gation into Alleged Anti-Competitive Conduct by TMX Group Limited” (21 November
2016); and Competition Bureau, Position Statement, “Competition Bureau statement regard-
ing its investigation alleged anti-competitive conduct by Apple” (6 January 2017); Competi-
tion Bureau, Position Statement, “Competition Bureau statement regarding its inquiry into
alleged anticompetitive conduct by Loblaw Companies Limited” (21 November 2017);
236
Competition Bureau, Position Statement, “Competition Bureau Statement Regarding Its In-
vestigation into Alleged Practices of Celgene, Pfizer, Sanofi” (20 December 2018); and
Competition Bureau, Position Statement, “Competition Bureau statement regarding its in-
quiry into alleged anti-competitive conduct by Janssen” (20 February 2019).
The Bureau’s stated enforcement priority areas are: the digital economy (see “No River too
Wide, No Mountain too High: Enforcing and Promoting Competition in the Digital Age”,
Act
speech delivered by Commissioner of Competition Matthew Boswell at the Canadian Bar
Association Competition Law Spring Conference 2019, May 7, 2019, in Toronto, Ontario);
airlines (see the Competition Bureau Statement Regarding Its Investigations into First Air,
Canadian North and Calm Air (Ottawa: Competition Bureau, August 2017; Commissioner of
Competition v. WestJet Airlines Ltd. et al., Court File No. T-2082-18); and pharmaceuticals
(see Competition Bureau statement regarding its inquiry into alleged anti-competitive con-
duct by Janssen (Ottawa: Competition Bureau, February 2019); Competition Bureau State-
ment Regarding Its Investigation into Alleged Practices of Celgene, Pfizer, Sanofi).
Additional information to the Bureau’s approach to the enforcement of the abuse of domi-
nance provisions of the Act may be found in its Abuse of Dominance Enforcement Guide-
lines (Ottawa: Competition Bureau, March 2019). See also Adam Fanaki, Special Counsel to
the Commissioner of Competition, “Flush with Success” or “Down the Tubes”: Abuse of
Dominance after Canada Pipe, 2008 Competition Law and Policy Forum, Landon Hall,
Cambridge, 6–8 February 2008.
Subsection (2)
Where the reviewable practice as defined in subsection 79(1) is found to exist and the order
prohibiting the practice is not sufficient to restore competition, the Tribunal has a wide dis-
cretion to issue an order compelling other actions which will restore competition. A divesti-
ture order is specifically contemplated but has never been ordered. Divestiture could be re-
quired where the anti-competitive practice was an acquisition (such as in Laidlaw) or where
the anti-competitive practice has led to 100% market share with high barriers to entry.
Subsection (3)
This limitation was probably inserted to indicate that orders under subsection 79(2) are not to
be punitive in nature but are to be directed at restoring competition.
Subsection (3.1)
The Competition Tribunal may order that the person or persons subject to an order issued
under subsections 79(1) or 79(2) also pay an administrative monetary penalty (AMP) not
exceeding $10 million (or $15 million in the case of subsequent orders). AMPs under section
79 are highly controversial for the reasons summarised in the 2007 Library of Parliament
report on Bill C-41 (which proposed to authorise the Tribunal to order telecommunications
service providers to pay AMPs of up to $15 million for abuse of dominance):
First, critics pointed out that the Competition Act’s civil provisions govern beha-
viour that is not inherently anti-competitive, and is prohibited only after the Compe-
tition Tribunal determines it is anti-competitive. Therefore, penalties imposed for
such behaviour should be limited to forward-looking remedies such as cease and
desist orders.
On a related point and in the case of abuse of dominant position, critics noted that
predatory behaviour is not easily distinguished from aggressive pro-competitive be-
haviour. The prospect of being ordered to pay an AMP of up to $15 million may
237
have a chilling effect on some companies in that it may deter them from engaging in
aggressive competitive pricing strategies.
Second, because AMPs are punitive in nature, the constitutional validity of imposing
them without providing customary criminal law safeguards is questionable. This
point was articulated by Professor Peter Hogg in relation to a prior attempt to amend
the Competition Act to increase the power to impose AMPs. He explained that, al-
though the Competition Act asserts that the purpose of an AMP is not to punish but
to promote conformity with the Act, such a large fine could be seen as a true penal
consequence that would attract the guarantees of section 11 of the Canadian Charter
of Rights and Freedoms. He commented that the magnitude of the penalty, $15 mil-
lion, is unheard of even in statutes that are avowedly criminal. He pointed out that
the Competition Act itself limits the fines for the crimes of conspiracy and bid-rig-
ging to $10 million.
Professor Hogg outlined three ways in which the Competition Act fails to meet
Charter standards in relation to AMPs. The first relates to the presumption of inno-
cence. AMPs are ordered in relation to practices proved on the balance of
probability; criminal offences must be proved beyond a reasonable doubt. The sec-
ond relates to disclosure of evidence. In criminal cases there must be full disclosure
to the defence, and the defence has a right to silence. Those guarantees are ignored
by the Competition Act in relation to civil proceedings that may lead to the imposi-
tion of AMPs. The third Charter issue, in Professor Hogg’s view, is that the type of
conduct that would attract an AMP is not well defined. There is no clear standard of
behaviour upon which companies may rely.
See Legislative Summary LS-552E, Bill C-41: An Act to amend the Competition Act by
Penny Becklumb, Andrew Kitching and Daniel J. Shaw (Ottawa: Library of Parliament Par-
liamentary Information and Research Service 20 March 2007 Revised 24 September 2007.
See also John B. Laskin, Administrative Monetary Penalties and Damages for Reviewable
Conduct: Not So Fast!, 2003 Competition Law Invitational Forum, Langdon Hall, Cam-
bridge, April/May 2003.
The Tribunal considered the constitutionality of AMPs for misleading advertising in Canada
(Commissioner of Competition) v. Gestion Lebski Inc., 2006 Comp. Trib. 32 (Competition
Trib.). The Tribunal held the protection provided by section 11 of the Charter is not availa-
ble to a person against whom the Commissioner institutes an proceeding under paragraph
74.01(1)(a) or (b) of the Act because proceedings under those paragraphs are not criminal in
nature and do not lead to true penal consequences. The maximum AMP under paragraphs
74.01(1)(a) or (b) was, at the time, $100,000 for individuals and $200,000 for corporations.
The Tribunal held that AMPs of that magnitude were not large enough to be considered truly
penal in nature. The Tribunal also accepted the Commissioner’s submissions that AMPs are
designed to encourage compliance with the law as opposed to punish wrongdoers.
The Ontario Superior Court reached a similar conclusion in its 2103 decision in Canada
(Competition Bureau) v. Chatr Wireless Inc., 2013 ONSC 5315 (Ont. S.C.J.). It found that
misleading advertising proceedings were regulatory in nature, commenced under the Ontario
Rules of Civil Procedure, and that they did not carry with them the possibility that the re-
spondents would be imprisoned. It considered whether such an administrative monetary pen-
alty is a fine “which by its magnitude would appear to be imposed for the purpose of re-
dressing the wrong done to society at large rather than to the maintenance of internal
discipline within the limited sphere of activity.” Section 74.1(4) provides that the terms of
any order made against a person under paragraph (1)(b), (c) or (d) shall be determined with a
view to promoting conduct by that person that is in conformity with the Deceptive Marketing
238
Practices Part of the Act, and not with a view to punishment. This section of the Competition
Act clearly informs any application of the principle of proportionality at the penalty-fixing
stage of proceedings under s. 74.01(1)(b).
In the 2010 decision Canada (Attorney General) v. United States Steel Corp., 2010 FC 642
(F.C.); affirmed 2011 FCA 176 (Fed. C.A.), the Federal Court concluded that the amount of
an AMP cannot be assessed in isolation and that a very high potential AMP was not, in and
Act
of itself, unconstitutional. That case involved AMPs of up to $10,000 per day of non-compli-
ance with the Investment Canada Act. To be effective in the context of the Investment Can-
ada Act, the Court concluded, an AMP must be flexible enough to address the wide financial
range of reviewable investments and of a sufficient magnitude to deter non-compliance,
rather than to be seen merely as a cost of doing business. Although section 79 AMPs have
not yet been considered by the Tribunal or a court, the Federal Court’s decision in the U.S.
Steel case lends clear support to the position that the high amount of an AMP alone will not
render it unconstitutional.
Subsections (3.2), (3.3)

Subsection 79(3.2) sets out the factors that the Tribunal will consider in determining the
amount of the AMP to impose under subsection 79(3.1). Subsection 79(3.3) specifies that
AMPs are not made for the purposes of punishment. The latter subsection coupled with juris-
prudence under section 11 of the Charter could in practice impose a downward pressure on
the quantum of AMPs. Both the Bureau and Tribunal may avoid seeking or ordering AMPs
near the maximums permitted by subsection 79(3.1) in an effort to reduce the possibility that
an AMP could be characterised as punitive.
Subsection (4)
Subsection 79(4) requires the Competition Tribunal to consider whether the lessening of
competition is attributable to the superior competitive performance of the dominant firm or
firms. If a lessening of competition is merely due to a dominant firm’s effectiveness as a
competitor, the Competition Tribunal should not issue an order because superior competitive
performance is the type of activity that the Act is intended to encourage.
Subsection (7)
Section 45 creates the offence of anti-competitive conspiracy and section 92 the reviewable
practice of merger. It is possible for alleged misconduct under both sections to also fall
within the scope of section 79. This subsection clarifies that dual proceedings cannot be
brought.
Case Law
The Commissioner of Competition v. Vancouver Airport Authority, 2019 Comp. Trib. 6 —
The Commissioner of Competition filed an application with the Competition Tribunal seek-
ing to stop the Vancouver Airport Authority (VAA) from imposing restrictions that allegedly
decreased competition among in-flight catering companies at Vancouver International Air-
port by denying new in-flight catering suppliers access to the airport.
While two judicial members of the panel found that VAA had a plausible competitive inter-
est with respect to catering and related services, the application was dismissed by the Tribu-
nal on the basis of a unanimous finding that the overall character, or overriding purpose, of
the Vancouver Airport Authority’s conduct was not anti-competitive, as contemplated by
paragraph 79(1)(b). Rather, VAA’s justifications for engaging in the impugned exclusionary
239
conduct — that the insufficient demand for catering and related services would cause any
entry of additional catering firms to imperil the continued viability of the operations of the
two existing catering firms at the airport — were more important than any subjective or
deemed anti-competitive intent, or any reasonably foreseeable anti-competitive effects of its
conduct. Moreover, the Tribunal found that the Commissioner did not establish that VAA’s
conduct prevented or lessened competition substantially, or that it was likely to do so in the
future, as contemplated by paragraph 79(1)(b) on the basis that the impugned conduct did
not materially reduce the degree of price or non-price competition with respect to catering
and related services, relative to the degree of competition that would likely have existed in
the absence of such conduct.
Canada (Commissioner of Competition) v. Toronto Real Estate Board, 2017 FCA 236; leave
to appeal to S.C.C. refused 2018 CarswellNat 4555 (S.C.C.) — The Federal Court of Appeal
dismissed TREB’s appeal of the Tribunal’s 2016 decision (described below). According to
the Court, the Tribunal did not make a reviewable error in relying on qualitative evidence for
its findings of anti-competitive effects (and its ultimate conclusion on substantiality), nor is
the Commissioner legally obligated to quantify all effects which can be quantified or to ad-
duce quantifiable evidence to successfully plead its case. In addition, the Court con-
firmed/opined on several other key issues, namely: (i) any anti-competitive act can form the
basis of an abuse of dominance claim (i.e., claims are not limited to the illustrative examples
set out at s. 78); (ii) competitive interest in the relevant market is enough (i.e., a party need
not be a direct competitor to substantially control a market); (iii) any alleged harm is mea-
sured relative to the level of actual competition that existed prior to the conduct (not against
a hypothetical perfectively competitive market) and whether, “but for” the impugned con-
duct, competition would no longer be lessened or prevented substantially; (iv) for a defence
to qualify as a legitimate business justification, there must be a credible or pro-competitive
rationale behind the impugned practice or policy and the efficiencies or competitive advan-
tages must, in turn, accrue to the benefit of the party that implements the practice or policy;
(v) a party can avoid liability for abuse of dominance, regardless of intent, if the anti-com-
petitive practice is necessary to comply with statutory or regulatory legal obligations, pro-
vided that a factual and legal connection exists between the statute or regulation and the
impugned practice or policy; and (vi) protecting intellectual property rights can justify an
anti-competitive practice if protection of the intellectual property right is the sole justifica-
tion for the practice (i.e., asserting intellectual property rights in part to eliminate competi-
tion would revoke a party’s ability to shield itself from liability under the abuse of domi-
nance provisions).
Commissioner of Competition v. Toronto Real Estate Board, 2016 Comp. Trib. 7 (Competi-
tion Trib.) — In 2014, the Federal Court of Appeal overturned the Competition Tribunal’s
dismissal of the Commissioner’s application against the Toronto Real Estate Board. TREB is
a trade association whose members are competing realtors. The Tribunal held that it was
bound by Canada Pipe to conclude that TREB can never engage in anti-competitive acts in
respect of the market for residential real estate services in Toronto because TREB is not a
competitor in that market. The Court agreed with the Commissioner that a person who is not
a competitor in a market can nevertheless substantially control a market within the meaning
of paragraph 79(1)(a). Its decision was informed by paragraph 78(1)(f), which describes con-
duct not necessarily taken by a person against that own person’s competitor. Therefore, Par-
liament could not have intended to limit the definition of anti-competitive acts to only those
acts having an effect on one’s own competitor for the purposes of paragraph 79(1)(b). The
Commissioner’s application was referred back to the Tribunal for reconsideration on the
merits.
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The Tribunal determined that the Commissioner had established that the three elements of
section 79 had been satisfied: TREB substantially or completely controlled the supply of
MLS-based residential real estate brokerage services in Toronto; TREB had engaged in a
practice of anti-competitive acts (i.e., the enactment of restrictions preventing some MLS
data from being used or displayed on “virtual office websites”); and these restrictions were
preventing competition substantially by reducing the degree of non-price competition in the
Act
supply of MLS-based residential real estate brokerage services. Accordingly, the Tribunal
ordered TREB to cease its practice of the anti-competitive acts (i.e., remove the restrictions
preventing use or display of MLS data on virtual office websites).
Commissioner of Competition v. Direct Energy Marketing Limited, 2015 Comp. Trib. 2
(Competition Trib.) — Approximately 22 months after the Commissioner of Competition
filed an application under s. 79 of the Competition Act alleging that Direct Energy had
abused its dominant position in the Ontario water heater rental market, Direct Energy exited
the market. The Tribunal rejected Direct Energy’s argument that its departure had effectively
put an end to the application. Otherwise, firms which substantially lessened or prevented
competition in the market for a number of years would be able to sell their business to an-
other firm and not be caught under s. 79. This could be particularly problematic where the
anti-competitive conduct had an impact on the valuation of the business or the acquisition
price.
Canada (Commissioner of Competition) v. Canada Pipe Co., 2006 CarswellNat 1763, 2006
FCA 233, 49 C.P.R. (4th) 241 (F.C.A.); reversing 40 C.P.R. (4th) 453, 2005 CarswellNat
2348, 2005 Comp. Trib. 3 (Competition Trib.) — The Commissioner applied for an order
under ss. 77 and 79 concerning alleged exclusive dealing and abuse of dominant position by
the company. The Commissioner alleged that the company’s Stocking Distributor Program
(SDP) was a practice of exclusive dealing under s. 77 of the Act. The SDP was a rebate
program whereby distributors of plumbing products in Canada received substantial discounts
in return for being supplied in cast iron drain, waste and vent (DWV) products exclusively
by a wholly-owned subsidiary of the company. The Tribunal found, under s. 79 of the Act,
that the company did substantially control the class of business comprising cast iron DWV
products in six areas in Canada. However, the Tribunal found that for a loyalty program such
as the SDP to be anti-competitive, the switching costs must prevent buyers from changing
suppliers. The Tribunal concluded that the SDP was not itself anti-competitive as its pres-
ence had not deterred entry by foreign and domestic suppliers, and its structure allowed cus-
tomers to leave SDP without incurring significant switching costs. The greatest savings to
customers came from the discounts applied at the point of purchase rather than the quarterly
or annual rebates. Accordingly, the Tribunal did not find that the SDP was a practice of anti-
competitive acts, nor did the Tribunal find that the SDP had substantially lessened or pre-
vented competition.
The Commissioner appealed from the decision of the Competition Tribunal, and the appeal
was allowed, with the matter referred back to the Tribunal for a re-determination. The Fed-
eral Court of Appeal found that the Tribunal did not apply the correct legal tests with respect
to the application of the abuse of dominance provisions. In particular, the Court ruled that
the Tribunal misapplied the legal test with respect to the requirements of (a) an “anticompeti-
tive act” and (b) “a substantial lessening or prevention of competition”. In regard to an an-
ticompetitive act, it must have an intended negative effect on a competitor that was preda-
tory, exclusionary or disciplinary. On the second issue, the Court reformulated the
substantial lessening of competition test to ask whether the relevant markets would be sub-
stantially more competitive but for the impugned practice of anti-competitive acts. This was
referred to as a “but for” test. In order to establish dominance in a market, both of these
241
elements must be shown before an order can be made. The Tribunal had erred in focusing on
whether there continued to be a substantial level of competition, rather than whether an im-
pugned practice had resulted, or will likely result, in a substantial prevention or lessening of
competition.
Canada (Commissioner of Competition) v. Air Canada (2003), 26 C.P.R. (4th) 476 (Compe-
tition Trib.) — The Commissioner alleged that the airline responded to the entry of two other
airlines on certain routes by increasing its capacity and/or decreasing its fares, in a manner
that did not cover the avoidable cost of operating the flights on such affected routes. The
Commissioner applied for an order of the Tribunal pursuant to s. 79 of the Act on the
grounds of abuse of the airline’s dominant position. The Commissioner was required to show
opportunities for cost avoidance generally and realistically available at the time of the al-
leged predation. The Tribunal found that the respondent operated or increased capacity at
fares that did not cover the avoidable costs of providing the service. Avoidable costs were all
costs that could be avoided by not producing the good or service in question. In general, the
avoidable cost of operating a service would consist of the variable costs, and the product-
specific fixed costs that were not sunk. The costs were avoidable through shedding, rede-
ployment or disposition of assets. The costs of labour, which were applied sequentially to
different services, were avoidable through redeployment.
Failing the avoidable cost test did not merely lead to the inference that a dominant carrier
had committed an anti-competitive act. Once a party fails the avoidable cost test, its conduct
does constitute an anti-competitive act. However, the Tribunal may consider legitimate busi-
ness justification when determining whether “a practice” of anti-competitive acts have
occurred.
Many of the “anti-competitive acts stated in s. 78 of the Act required an “object”, “design”
or “intent” to engage in exclusionary conduct that had the effect of augmenting, entrenching
or extending market power. The presence of such wording made the concept of legitimate
business justification relevant in prior tribunal jurisprudence. However, no such intention
was expressly stated in the definition of an “anti-competitive act” in s. 78(1)(j) of the Act.
Evidence of a legitimate business justification could be considered for the period prior to the
coming into effect of the Regulations Respecting Anti-Competitive Acts of Persons Operat-
ing a Domestic Service, SOR/2000-324. The Regulations did not specify a time period for
defining what constituted an anti-competitive act. Accordingly, whenever, the dominant car-
rier operates capacity at fares below the avoidable cost of providing the service, it commits
an anti-competitive act. A one-month period for determining whether revenue exceeded
avoidable cost was considered appropriate.
Canada (Commissioner of Competition) v. Air Canada (April 20, 2001), Trib. Dec. No.
CT2001/002/008 (Competition Trib.) — The Commissioner applied under s. 79 of the Com-
petition Act for an order prohibiting the respondent from engaging in anti-competitive prac-
tices directed against low cost carriers such as Westjet Airlines. Westjet applied for inter-
venor status in the proceedings which application was opposed by the respondent on the
basis that Westjet had failed to articulate the issues in which it seeks leave to intervene.
Westjet was granted leave to intervene as it satisfied the test stated in subsection 9(3) of the
Competition Tribunal Act. Westjet was directly affected by the alleged anti-competitive
practices, and had a unique perspective on the issues that would be before the Tribunal.
Westjet’s participation was limited to the issues that met the requirements of subsection 9(3)
such as the respondent’s dominant position, the substantial lessening of competition as it
relates to Westjet, and the issue of avoidable costs.
Chadha v. Bayer Inc. (1998), 82 C.P.R. (3d) 202 (Ont. Gen. Div.) — A civil conspiracy
claim could not be based upon an alleged abuse of dominant position contrary to s. 79 of the
242
Act as prior to any prohibition being ordered by the Competition Tribunal, such abuse of
dominant position as described in s. 79 is not unlawful.
Canada (Director of Investigation & Research) v. Tele-Direct (Publications) Inc. (1997), 73
C.P.R. (3d) 1 (Competition Trib.) — The respondents provided both advertising in a pub-
lished directory and advertising services. For purposes of abuse of dominant position under
s. 79 or tied selling under s. 77, it was first essential to determine the relevant product mar-
Act
ket. The respondent’s position that its Yellow Pages directories were only part of a broader
market comprised of all local advertising media was rejected. The respondents were found to
have control or market power based on its market share and the barriers to entry. They en-
gaged in a practice of discriminatory anti–competitive acts against advertising consultants.
Where a business with a high degree of market power engages in anti-competitive conduct,
smaller impacts on competition will meet the test of substantial lessening of competition.
The respondents were prohibited from rejecting orders submitted through consultants.
Canada (Director of Investigation & Research) v. D & B Co. of Canada Ltd. (1995), 64
C.P.R. (3d) 216 (Competition Trib.) — The Director brought an application against the re-
spondent to obtain an order to prohibit certain contracting practices of the respondent and for
additional remedies to restore competition in the market. The Director alleged that the word-
ing “class or species of business” is used in para. 79(1)(a) of the Act as an alternative to the
word “market” because “market” has a geographic element to it and there is already a geo-
graphic element in para. 79(1)(a), being the phrase “throughout Canada or any area thereof”,
which was put in specifically to limit the application of the word “control” to Canada. “Class
or species of business” is synonymous with the relevant product market and “control” is
synonymous with market power.
Where price and quantity changes are not in evidence, as is in the present case, it is neces-
sary to determine whether products are in the same market by examining the evidence of
both buyers and suppliers regarding the characteristics, the intended use and the price of the
various types of market tracking services. The Tribunal considered the timeliness, detail,
accuracy, reliability and cost of collection of the data and the extent to which product move-
ment data can be combined with causal data. The evidence overwhelmingly favoured the
conclusion that market tracking services based on information derived from audit, warehouse
shipment or consumer panel data are not in the same market as market tracking services
based on scanner data. Accordingly, the relevant product market was scanner–based market
tracking services. The relevant geographic market was Canada.
There was no dispute that the respondent was the sole supplier in the relevant market and
thus had a 100% market share. The Tribunal was prepared to find that, prima facie, the
respondent had market power, or control, in the relevant market absent some evidence that
there were no barriers to entry.
The respondent had contracts with all major grocery retailers and with several drug retailers,
including the largest, for exclusive access to their scanner data. Contracts also contained
inducements to exclusivity, being structured so that there was one level of payments as long
as the respondent retained its “preferred supplier” status and a lower level of payments if the
data were provided to others. The standard term for the exclusive contracts was five years.
The respondent also had contracts for scanner–based market tracking services with the man-
ufacturers of consumer packaged goods. There was little evidence in support of the proposi-
tion that exclusives were justified because of the time, energy and resources that had to be
expended to exploit a new technology. The Tribunal found that the long–term contracts,
along with the exclusives and inducements to exclusivity, were intended to exclude potential
competitors. These actions constituted a practice of anti–competitive acts within the meaning
of s. 78 and, in particular, paras. 78(e) and 78(h) of the Act.
243
The respondent’s exclusive contracts and the inducements that led to them resulted in the
prevention or lessening of competition substantially in the Canadian market for scan-
ner–based market tracking services. Its long–term contracts with its customers also pre-
vented competition by significantly reducing the volume of business available to a would–be
entrant. This latter consideration, however, assumed importance only in a context where the
barriers resulting from the exclusive contracts with retailers had been eliminated. If an en-
trant could not get access to the necessary input for providing a scanner–based market track-
ing service, namely the scanner data, it was irrelevant at that point that the entrant would also
be precluded by long–term contracts from obtaining sufficient customers to survive.
The Tribunal prohibited, inter alia, the respondent from entering into future contracts which
restricted or precluded a retailer from supplying data necessary for the provision of a scan-
ner-based market tracking service to someone other than the respondent and from offering a
retailer inducements to restrict or preclude access in that way. With respect to existing re-
tailer contracts, the Tribunal prohibited the respondent from enforcing the provisions in
those contracts which restrict or preclude a retailer from supplying the data necessary for the
provision of a scanner-based market tracking service to someone other than the respondent.
The Director did not ask the Tribunal to deal with the implicit inducements to exclusivity in
existing retailer contracts and the Tribunal found that it would have been difficult to do so.
Canada (Director of Investigation & Research) v. Laidlaw Waste Systems Ltd. (1992), 40
C.P.R. (3d) 289 (Competition Trib.) — The Director brought an application for orders
prohibiting the respondent, Laidlaw, from engaging in certain anti-competitive acts and for
orders to redress the anti-competitive situation created by those acts.
The relevant product market, a specific category of commercial waste collection and dispo-
sal service, was not in dispute. In considering the scope of the geographic market, the Tribu-
nal observed that it is not obvious that the significant non–transitory price increase test is
useful in an abuse of dominant position case. The Tribunal ultimately determined that the
geographic markets were local communities on Vancouver Island.
In deciding whether Laidlaw had substantial or complete control of a market, the Tribunal
considered whether Laidlaw had market power, the power to maintain prices above the com-
petitive level without losing so many sales that the higher price is not profitable. A prima
facie determination as to whether a firm is likely to have market power can be made by
considering its market share, but other considerations must also be taken into account includ-
ing: the number of competitors and their market shares; any excess capacity in the market-
place; and how easily a new firm can establish itself as a competitor.
The Tribunal ultimately concluded that Laidlaw had an 87% or higher market share in cer-
tain commercial waste collection and disposal services in local communities on Vancouver
Island and that it was dominant in those markets.
The Tribunal concluded that a pattern of acquisitions undertaken by Laidlaw designed to
create and maintain its monopoly position, together with contracting practices designed to
preserve that position, were anti–competitive acts even though they are not among those
enumerated in s. 78. The frequency, timing and result of the acquisitions and attempted ac-
quisitions supported the conclusion that they were entered into for the purpose of monopoliz-
ing markets. While subjective intent may not be a required element in order to find that a
given practice is of an anti–competitive nature, in this case such intent existed. Laidlaw’s
business purpose explanation for the acquisitions was not convincing. The overly restrictive
non–compete covenants in the acquisition agreements also demonstrated an intent to monop-
olize the markets. Laidlaw asserted that a horizontal merger agreement should be assessed as
a merger under s. 91, not s. 79, because: (a) para. 78(b) includes as anti–competitive acts the
244
acquisition by a supplier of a customer and the acquisition by a customer of a supplier, but

not the acquisition of a competitor; and (b) s. 91 defines merger, in part, as “the acquisi-
tion. . .of control over or significant interest in the whole or a part of a business of a competi-
tor. . .”. The Tribunal rejected those arguments. First, para. 78(b) is explicitly non-exhaus-
tive. The fact that an act is not listed in para. 78(b), even if it is listed elsewhere in the
statute, is no reason to conclude that it is excluded as an anti-competitive act. Second, while
Act
s. 91 does state that the acquisition of a competitor is a merger, it does not necessarily follow
that such an acquisition exclusively falls under the merger provisions. The Tribunal also
considered Laidlaw’s use of standard form contracts of adhesion to lock in a customer base.
In most cases long–term, exclusive contracts do not raise significant anti–competitive issues.
However, in this case, there was no credible explanation for many of the provisions of these
contracts other than to create barriers to entry for would-be competitors by making customer
purchase decisions inflexible. The tying of the customers to Laidlaw operated to exclude
other competitors from the market. Proof of subjective intention on the part of a respondent
is not necessary in order to find that a practice of anti–competitive acts has occurred. It is no
answer to say that the contracts were standard form or designed for a different market and
therefore not intended to have anti–competitive effects in the smaller market. Actions will be
presumed to have been intended to have the effects which actually occur in the absence of
convincing evidence to the contrary. The Tribunal also commented on Laidlaw’s practice of
using its vastly larger size and economic resources together with the threat of litigation to
prevent customers from switching to competitors. Laidlaw had commenced spurious litiga-
tion and threatened litigation against its competitors to drive or attempt to drive them out of
business by raising their costs of doing business, which the Tribunal found was “certainly
predatory behaviour.”
The Tribunal determined that there had been a substantial lessening of competition. The
substantial lessening need not necessarily be assessed by weighing the competitiveness of
the market in the past with its competitiveness at present. Substantial lessening can also be
assessed by reference to the competitiveness of the market in the presence of the anti-com-
petitive acts and its likely competitiveness in their absence.
In considering remedies, the Tribunal noted that it had broad jurisdiction to interfere with
property rights not only of the party or parties before it but also of third parties who have
contracts with the respondent. Among other things, the Tribunal prohibited Laidlaw from
acquiring any competitor in the market for a period of three years; declared restrictive cove-
nants in certain acquisition agreements to be null and void; and ordered that customer con-
tacts, both present and future, have an initial term of no longer than one year.
Procter & Gamble Co. v. Kimberly-Clark of Canada Ltd. (1991), 40 C.P.R. (3d) 1, (sub
nom. Procter & Gamble Co. v. Kimberly-Clark of Canada Ltd. (No. 4)) 49 F.T.R. 31
(T.D.) — The abuse of a dominant position is a reviewable practice under Part VIII of the
Act, but an order under s. 79 will be made only if the alleged offender substantially or com-
pletely controls throughout Canada or an area thereof a class or species of business, is engag-
ing in anti-competitive acts, and these acts have the effect of preventing or lessening compe-
tition in a market.
(Competition Trib.) — The respondent substantially controls through its market power the
sale of aspartame in Canada. It achieved this control in part through the practice of a number
of frequently repeated anti-competitive acts within the meaning of s. 79, including the use in
its supply contracts of exclusive supply and use clauses, logo display allowances, coopera-
tive marketing allowances, meet or release clauses, and most-favoured-nation clauses. The
respondent also used its United States patent to foreclose competition by a system of rebates
245
on exports from the United States to induce Canadian importers to have only the respon-
dent’s product used in products they purchased in Canada. These practices had the effect of
preventing or lessening competition substantially. Furthermore, the financial incentives and
the exclusivity clause in its contracts amounted to a practice of exclusive dealing within the
meaning of s. 77(1)(b). An order was therefore issued prohibiting the respondent from enter-
ing into or enforcing such contract terms with Canadian customers unless such terms also
appeared in contracts between the respondent and any competitors of the Canadian
customers.
79.1 Unpaid monetary penalty — The amount of an administrative mone-

tary penalty imposed on a person under subsection 79(3.1) is a debt due to Her
Majesty in right of Canada and may be recovered as such from that person in
a court of competent jurisdiction.
2002, c. 16, s. 11.5; 2018, c. 8, s. 114
Delivered Pricing
80. (1) Definition of “delivered pricing” — For the purposes of section

81, “delivered pricing” means the practice of refusing a customer, or a person
seeking to become a customer, delivery of an article at any place in which the
supplier engages in a practice of making delivery of the article to any other of
the supplier’s customers on the same trade terms that would be available to
the first-mentioned customer if his place of business were located in that place.
(2) Definition of “trade terms” — For the purposes of subsection (1), the
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
Commentary
The reviewable practice of delivered pricing must be understood in terms of the anti-compet-
itive effects of basing point pricing systems. Under a basing point pricing system a seller will
charge a delivered price to a buyer, consisting of the price plus transportation costs calcu-
lated from a situs, called the “basing point”, to the buyer’s place of business. If several
geographic regions are used with different basing points this is called a multiple basing point
system. Because the delivered price in basing point systems is comprised in part of a trans-
portation component predicated upon the buyer’s distance from the basing point, regardless
of the buyer’s actual distance from the seller’s plant, such formula pricing systems can result
in the buyer paying for transportation costs never actually incurred, the so-called “phantom
freight”, as well as in the seller not charging for freight charges which it has incurred,
“freight absorption”.
The real potential anti-competitive harm of basing point systems arises from their ability to
facilitate oligopolistic price coordination where all sellers use the same basing points. A
buyer will then be quoted the same delivered price by all sellers, regardless of the fact that
one seller may have a locational advantage.
Basing point pricing systems are not made a reviewable practice as such, nor is the refusal to
supply free on board (F.O.B.) plant made reviewable. What is reviewable is the practice of
246
refusing to supply a customer at a place where the seller supplies another customer. Thus, if
a buyer who was previously being charged “phantom freight” opted to take delivery at the
location of another buyer close to the basing point and pay his own transportation costs, and
was consistently refused this advantage by the supplier, then the practice as defined in this
section would have been committed.
It should be noted that “delivered pricing” as defined must constitute a “practice”. Isolated
Act
refusals to supply would not constitute a practice.
While basing point systems as such are not reviewable, orders made prohibiting delivered
pricing as defined should have the effect of making oligopolistic coordination more difficult,
as well as being more fair to particular buyers.
81. (1) Delivered pricing — Where, on application by the Commissioner,

the Tribunal finds that delivered pricing is engaged in by a major supplier of
an article in a market or is widespread in a market with the result that a cus-
tomer, or a person seeking to become a customer, is denied an advantage that
would otherwise be available to him in the market, the Tribunal may make an
order prohibiting all or any of such suppliers from engaging in delivered
pricing.
(2) Exception where significant capital investment needed — No
order shall be made against a supplier under this section where the Tribunal
finds that the supplier could not accommodate any additional customers at a
locality without making significant capital investment at that locality.
(3) Exception where trademark used — No order shall be made against
a supplier under this section in respect of a practice of refusing a customer
delivery of an article that the customer sells in association with a trademark
that the supplier owns or in respect of which the supplier is a registered user
where the Tribunal finds that the practice is necessary to maintain a standard
of quality in respect of the article.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.1); 2014, c. 20, s. 366(1)
Commentary
Subsection (1)
A condition which must be met before the Tribunal can issue an order prohibiting delivered
pricing as defined is for the “practice” to be engaged in by a “major” supplier or be wide-
spread in the market. The assumption is that if the practice is not widespread it can neither be
reflective of anti-competitive market conditions nor be in and of itself harmful to
competition.
The words “major supplier” are used in subsection 77(2) in defining the reviewable practices
of exclusive dealing and tied selling. See the annotations to section 77.
Subsection (2)
According to Competition Law Amendments: A Guide, Consumer and Corporate Affairs
Canada (1985), p. 25, this subsection would apply to a situation where the seller supplies
storage or shipping facilities which are operating at full capacity so that new capital would
be required to be invested to accommodate a new customer.
247
Subsection (3)
This subsection refers to circumstances where the practice of selling only on a delivered
basis might be necessary to ensure the standard or quality of a product associated with a
trade mark. Transportation might, in some circumstances, affect the quality of the product.
For example, the supplier might find it necessary to ensure the quality of a perishable prod-
uct by requiring that it be delivered to its ultimate destination in refrigerated trucks. It could
not ensure this if an order under s. 81(3) was made. Hence s. 81(3) was enacted as a defence
in such situations.
82. Foreign judgments, etc. — Where, on application by the Commis-

sioner, the Tribunal finds that
(a) a judgment, decree, order or other process given, made or issued by or
out of a court or other body in a country other than Canada can be imple-
mented in whole or in part by persons in Canada, by companies incorpo-
rated by or pursuant to an Act of Parliament or of the legislature of a
province, or by measures taken in Canada, and
(b) the implementation in whole or in part of the judgment, decree, order
or other process in Canada, would
(i) adversely affect competition in Canada,
(ii) adversely affect the efficiency of trade or industry in Canada
without bringing about or increasing in Canada competition that
would restore or improve that efficiency,
(iii) adversely affect the foreign trade of Canada without compensat-
ing advantages, or
(iv) otherwise restrain or injure trade or commerce in Canada with-
out compensating advantages,
the Tribunal may, by order, direct that
(c) no measures be taken in Canada to implement the judgment, decree,
order or process, or
(d) no measures be taken in Canada to implement the judgment, decree,
order or process except in such manner as the Tribunal prescribes for the
purpose of avoiding an effect referred to in subparagraphs (b)(i) to (iv).
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.2)
Commentary
The Tribunal has never issued an order under section 82.
83. (1) Foreign laws and directives — Where, on application by the

Commissioner, the Tribunal finds that a decision has been or is about to be
248
made by a person in Canada or a company incorporated by or pursuant to an

Act of Parliament or of the legislature of a province
(a) as a result of
(i) a law in force in a country other than Canada, or
(ii) a directive, instruction, intimation of policy or other communica-
Act
tion to that person or company or to any other person from
(A) the government of a country other than Canada or of any
political subdivision thereof that is in a position to direct or in-
fluence the policies of that person or company, or
(B) a person in a country other than Canada who is in a position
to direct or influence the policies of that person or company,
where the communication is for the purpose of giving effect to a law
in force in a country other than Canada,
and that the decision, if implemented, would have or would be likely to
have any of the effects mentioned in subparagraphs 82(b)(i) to (iv), or
(b) as a result of a directive, instruction, intimation of policy or other
communication to that person or company or to any other person, from a
person in a country other than Canada who is in a position to direct or
influence the policies of that person or company, where the communica-
tion is for the purpose of giving effect to a conspiracy, combination,
agreement or arrangement entered into outside Canada that, if entered
into in Canada, would have been in contravention of section 45,
(c) in a case described in paragraph (a) or (b), no measures be taken by
the person or company in Canada to implement the law, directive, in-
struction, intimation of policy or other communication, or
(d) in a case described in paragraph (a), no measures be taken by the
person or company in Canada to implement the law, directive, instruc-
tion, intimation of policy or other communication except in such manner
as the Tribunal prescribes for the purpose of avoiding an effect referred
to in subparagraphs 82(b)(i) to (iv).
(2) Limitation — No application may be made by the Commissioner for an
order under this section against a particular company where proceedings have
been commenced under section 46 against that company based on the same or
substantially the same facts as would be alleged in the application.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.3)
Foreign Suppliers
84. Refusal to supply by foreign supplier — Where, on application by

the Commissioner, the Tribunal finds that a supplier outside Canada has re-
fused to supply a product or otherwise discriminated in the supply of a prod-
249
uct to a person in Canada (the “first” person) at the instance of and by reason
of the exertion of buying power outside Canada by another person, the Tribu-
nal may order any person in Canada (the “second” person) by whom or on
whose behalf or for whose benefit the buying power was exerted
(a) to sell any such product of the supplier that the second person has
obtained or obtains to the first person at the laid-down cost in Canada to
the second person of the product and on the same terms and conditions as
the second person obtained or obtains from the supplier; or
(b) not to deal or to cease to deal, in Canada, in that product of the
supplier.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.4)
85. Definitions — For the purposes of this section and sections 86 to 90,
“article” includes each separate type, size, weight and quality in which an arti-
cle, within the meaning assigned by section 2, is produced;
“registered” means registered in the register maintained pursuant to section
89;
“specialization agreement” means an agreement under which each party
thereto agrees to discontinue producing an article or service that he is engaged
in producing at the time the agreement is entered into on the condition that
each other party to the agreement agrees to discontinue producing an article
or service that he is engaged in producing at the time the agreement is entered
into, and includes any such agreement under which the parties also agree to
buy exclusively from each other the articles or services that are the subject of
the agreement.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
Commentary
Sections 85–90 provide a procedure under which specialization agreements as defined in
section 85, can, if the criteria in section 86 are met, be exempted from the conspiracy and
exclusive dealing sections of the Act.
The underlying assumption behind this exemption is that in some market structures firms
may be producing too many articles or varieties or grades of articles, with consequently too
short a production run in respect of each article or grade thereof, for each firm. It is thought
costs could be lowered and substantial economies of scale attained if the firms in such a
market specialized in fewer product lines. Thus specialization agreements could, through the
mechanism of a contractual arrangement, achieve the economies of specialization that mar-
ket conditions themselves had failed to engender.
A hypothetical example of a specialization agreement will illustrate the intent of these provi-
sions. Suppose A, B and C each manufacture three separate varieties of widgets, that is, they
each produce three lines. Further assume that they each have approximately one third of the
market of each item. It might be possible that if the assets of A, B and C each were devoted
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to producing only one of the widget varieties, production runs would be longer and unit costs
less. Hence, A, B and C enter into an agreement under which each of them agrees to produce
only one variety. Each should be able to achieve economies of large scale production, as-
suming they were not producing at an optimum level previously.
In order to effectively implement a specialization agreement it might be necessary for the
parties to enter into an exclusive dealing arrangement, referred to in the definition of special-
Act
ization agreement. The reason for this is that even though the parties have by agreement
specialized in production, they have not agreed not to sell the discontinued line of articles or
service. In fact, their customers might demand to be able to purchase all grades from one
supplier; this might even be the most efficient way to distribute the articles or service. But if
a party to a specialization agreement could buy the discontinued line from a person not a
party to the agreement, this would obviously affect the other parties’ ability to achieve the
economies of scale and longer production runs. Hence, the definition of a specialization
agreement enables the parties to contract to buy exclusively from each other.
Specialization agreements as defined in s. 85 which meet the test set forth in s. 86 and which
are approved by the Tribunal may be registered and thus exempt from the conspiracy provi-
sions of the Act found in s. 45 and from the exclusive dealing provisions of s. 77.
Since the case for an exemption from s. 45 and s. 77 cannot even be made unless the agree-
ment in question falls within the meaning of a specialization agreement as defined in s. 85, it
is useful to examine this definition in some detail. First, it must be noted that each party must
agree to discontinue producing an article or service. This means that it is not open to a party
to agree to merely reduce production; it must discontinue production of an article or service
entirely. A party could not be said to have discontinued production if it agreed to close down
production only in one part of the country but still maintained it in another, even if the
specialization agreement in general was intended to be regional in nature. Secondly, the arti-
cle or service discontinued must be one that the party was producing at the time of the agree-
ment; this means that a promise not to produce a line of goods or services which the party
had not previously produced, but was contemplating producing, would be insufficient. In
sum, the essence of a specialization agreement is a promise to discontinue entirely existing
production of an article or service in consideration of equivalent promises from the other
parties.
The definition of “article” as including each separate type, size, weight and quality is obvi-
ously wider than the normal definition of article. It is necessary, however, since specializa-
tion agreements may very well entail specialization of production of a given article by sizes,
qualities, etc.
86. (1) Order directing registration — Where, on application by any per-

son, and after affording the Commissioner a reasonable opportunity to be
heard, the Tribunal finds that an agreement that the person who has made the
application has entered into or is about to enter into is a specialization agree-
ment and that
(a) the implementation of the agreement is likely to bring about gains in
efficiency that will be greater than, and will offset, the effects of any pre-
vention or lessening of competition that will result or is likely to result
from the agreement and the gains in efficiency would not likely be at-
tained if the agreement were not implemented, and
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(b) no attempt has been made by the persons who have entered or are
about to enter into the agreement to coerce any person to become a party
to the agreement,
the Tribunal may, subject to subsection (4), make an order directing that the
agreement be registered for a period specified in the order.
(2) Factors to be considered — In considering whether an agreement is
likely to bring about gains in efficiency described in paragraph (1)(a), the Tri-
bunal shall consider whether those gains will result in
(a) a significant increase in the real value of exports; or
(b) a significant substitution of domestic articles or services for imported
articles or services.
(3) Redistribution of income does not result in gains in effi-
ciency — For the purposes of paragraph (1)(a), the Tribunal shall not find
that an agreement is likely to bring about gains in efficiency by reason only of
a redistribution of income between two or more persons.
(4) Conditional orders — Where, on an application under subsection (1),
the Tribunal finds that an agreement meets the conditions prescribed by
paragraphs (a) and (b) of that subsection but also finds that, as a result of the
implementation of the agreement, there is not likely to be substantial competi-
tion remaining in the market or markets to which the agreement relates, the
Tribunal may provide, in an order made under subsection (1), that the order
shall take effect only if, within a reasonable period of time specified in the
order, there has occurred any of the following events, specified in the order:
(a) the divestiture of particular assets, specified in the order;
(b) a wider licensing of patents, certificates of supplementary protection
issued under the Patent Act or registered integrated circuit topographies;
(c) a reduction in tariffs;
(d) the making of an order in council under section 23 of the Financial
Administration Act effecting a remission or remissions specified in the or-
der of the Tribunal of any customs duties on an article that is a subject of
the agreement; or
(e) the removal of import quotas or import licensing requirements.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1990, c. 37, s. 32; 1999, c. 2, s. 37(z.5); 2017, c.
6, s. 125
Commentary
Subsection (1)
This section establishes the criteria for approval of specialization agreements by the Tribu-
nal. The test in paragraph 86(1)(a) entails a balancing of efficiency gains against the reduc-
tion of competition that is necessarily incidental to such agreements. It is difficult even to
speculate how the test will be applied in practice. It must be found that efficiency gains will
“both be greater than” and “will offset” the effects of the reduction in competition that will
252
likely result from the agreement. Whether efficiency gains are greater than the effects of
reduction in competition is in one sense difficult, if not impossible, to literally measure.
Efficiency gains, or rather the likelihood of such, can perhaps be quantified, particularly with
the assistance of expert witnesses such as economists and cost accountants. The effect of a
reduction in competition is much more abstract.
A possible interpretation would be that since specialization agreements will necessarily re-
Act
sult in the parties having increased market power, in some cases maybe even monopoly
power, and since according to economic theory increased market power can lead to a party
producing at a lower level and a higher price than would prevail in a competitive market, the
tribunal must consider this factor. Balanced against the quantified efficiency gains resulting
in potentially lower prices must be the increased market power of the parties which might
manifest itself in the parties producing at less than the optimal level of production and at a
higher price. In short, because of increased market power parties to the agreement might not
avail themselves fully of the potential efficiencies associated with long production runs and
might not pass on such efficiencies as are attainable to the consumer.
The last condition in paragraph 86(1)(a) is that the efficiency gains, “would not likely be
attained if the agreement were not implemented”. This might require the Tribunal to predict
the likelihood of specialization economies occurring in any event. Conceivably this could
happen independently as the result of market forces. It might also involve the Tribunal in an
inquiry into whether there was a less restrictive method of attaining the same projected
efficiencies.
Paragraph 86(1)(b) and subsection 86(4) are the safeguards built into the procedure for the
exemption of specialization agreements.
Note that the agreement may be registered for a period at the discretion of the Tribunal.
The Tribunal has never issued an order under section 86. The Competition Bureau appears to
have reviewed a specialisation agreement in at least one case and concluded that there were
“no grounds to proceed with an application to the Competition Tribunal or a referral to the
Attorney General of Canada under the criminal provisions.” See Competition Bureau, Tech-
nical Backgrounder, “Merger of TSX Group Inc. and Bourse de Montréal Inc.,” (24 Febru-
ary 2009), and Competition Bureau, News Release, “Restructuring of the Canadian Stock
Exchanges” (17 November 1999).
Subsection (2)
The phrase “real value” is used elsewhere in the Act, specifically in paragraphs 45(6)(a) and
96(2)(a), both again in relation to exports. While the phrase has received little judicial con-
sideration it almost certainly means, in this context, the actual monetary value of exports as
opposed to the physical volume. See the commentary to subsection 45(6).
On the face of it the section simply requires the Tribunal to consider whether there is a
significant increase in the real value of exports in determining whether there are efficiency
gains. An increase in the real value of exports could occur in two separate ways. First, actual
economies caused by the specialization might enable the firms to compete more effectively
against foreign rivals for export markets. The second possibility is that the increased market
power inherent in the specialization agreement, might, if foreign competition is very weak,
allow the firms to exert their market power through price increases to foreign buyers even
though the physical volume of exports might decrease. In such a case the “real value” of
exports might have increased substantially.
Conversely, paragraph (2)(b) refers to a situation where a Canadian market has been the
subject of import competition and where the economies associated with specialization will
253
enable the Canadian producers to lower their prices sufficiently to cause a shift in the market
from imported goods to those of the specializing firms.
It is important to note that the importance of the discussed effects will depend on whether
there has been a “significant” increase in exports or domestic substitution. Hence the inter-
pretation given to “significant” will be critical.
This subsection must also be placed in context. If the “significant” effects mentioned are
likely to occur, it does not necessarily mean the Tribunal must find that gains in efficiency
likely to outweigh the effects of reduced competition under subsection 86(1) have occurred.
The Tribunal must simply “consider” these “significant” effects in determining that issue.
Nevertheless, the special consideration which Parliament has given to the “balance of trade”
issue will have to be weighed very carefully by the Tribunal.
The phrase “real value” has received some judicial consideration, though not in this context,
in the following cases, most of which relate to appraisal of land or other assets: Grampian
Realties Co. v. Montreal East, [1932] 1 D.L.R. 705 (S.C.C.); Tellier v. St. Michel-des-
Caints, [1951] Que. S.C. 34; Croteau v. Corp de St. Joseph de Coleraine (1936), 42 R. de
Jur. 401; Lounsbury Co. v. Bathurst (1948), 22 M.P.R. 436, [1949] 1 D.L.R. 62 (N.B. C.A.).
Subsection (3)
This subsection differentiates between true and pecuniary efficiency gains. Efficiency gains
are not to be considered unless the gains result from true productivity increases. A classic
example of a pecuniary cost saving to which this section refers is where as a result of the
increased market power engendered by the specialization agreement a firm is able to
purchase goods from its suppliers more cheaply. If the only reason for this cost saving is the
exertion of increased market power, resulting in a transfer of income from the supplier to the
buyer, this would be a pecuniary efficiency to which this subsection refers. In contrast, if the
lower price from the supplier was made possible because the actual costs of the supplier
decreased, for example, as a result of lower distribution costs associated with selling in
larger volumes, then this would not be a mere pecuniary efficiency gain under this
subsection.
It should be noted that subsection 86(3) does not state that the Tribunal shall not consider
mere pecuniary efficiency gains. What it does state is that the criterion in paragraph 86(1)(a)
shall not be considered to have been satisfied “by reason only” of such gains. This leaves
open the possibility of the Tribunal considering pecuniary gains where there are also “true”
efficiency gains in terms of input of resources. One can particularly envision the Tribunal
considering pecuniary efficiency gains along with “true” economies where the pecuniary
efficiency gains are at the expense of foreign suppliers or buyers.
Subsection (4)
This subsection provides for an additional safeguard even where the “balancing” test in sub-
section 86(1) has been met, but where there will not likely be “substantial competition” re-
maining in the market. It is probable that a great many specialization agreements will result
in an absence of substantial competition if they are to have the desired effect in terms of
implementing efficiencies.
Subsection 86(4) allows for the making of conditional orders which the Tribunal “may”
make.
All of the events referred to in this subsection upon which the implementation of an order
may be conditional go to mitigating anti-competitive effects engendered by the agreement.
Paragraphs (4)(a) and (b) refer to events within the control of the parties to the agreement
254
whereas the events referred to in paragraphs (4)(c), (d), and (e) are outside their control. This
leaves open the very real possibility of specialization agreements which are approved condi-
tionally but which are never actually implemented.
87. (1) Registration of modifications — On application by the parties to

a specialization agreement that has been registered, and after affording the
Act
Commissioner a reasonable opportunity to be heard, the Tribunal may make
an order directing that a modification of the agreement be registered.
(2) Order to remove from register — Where, on application by the Com-
missioner, the Tribunal finds that the agreement or a modification thereof that
has been registered
(a) has ceased to meet the conditions prescribed by paragraph 86(1)(a) or
(b) or
(b) is not being implemented,
the Tribunal may make an order directing that the agreement or modification
thereof, and any order relating thereto, be removed from the register.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.6)
Commentary
Subsection (1)
The modification referred to here is a modification of the agreement, not the order. Presuma-
bly the modification sought could extend or decrease the specialized lines, add or delete an
exclusive dealing clause, etc. It seems doubtful whether new parties could be added, since
the subsection refers to application by the parties to the registered agreement. It is also
doubtful whether the period of registration could be extended, since this would be a modifi-
cation to the order, not the agreement.
Subsection (2)
The Commissioner can apply for deletion from the register of previously approved agree-
ments that have not been implemented or where the conditions in s. 86(1)(a) or (b) are no
longer being satisfied. Section 86(1)(a) proposes a balancing of efficiency gains against re-
duction in competition. Such a “balance” can change over time through no misconduct of the
parties.
For example, if at the time of the original agreement there was still significant competition
from non-parties but subsequently these competitors through natural attrition departed from
the market, then the conditions of s. 86(1)(a) might no longer exist. If so, the parties might
have monopoly power not originally anticipated. The Commissioner can then apply to have
registration of the agreement terminated, though not, it seems, to have the continuation of
registration made conditional.
One problem with this “safeguard” is that, even though the Tribunal may terminate registra-
tion of the agreement and hence immunity of the parties from prosecution under s. 45, an
established market structure of a monopoly or near monopoly will continue. Presumably if
the parties to the original agreement simply continue in their specialized production lines,
this will not be the result of an illegal agreement. In other words, deregistration does not
require the parties to revert back to their original production lines.
255
88. Right of intervention — The attorney general of a province may inter-

vene in any proceedings before the Tribunal under section 86 or 87 for the
purpose of making representations on behalf of the province.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
89. (1) Register of specialization agreements — The Tribunal shall

cause to be maintained a register of specialization agreements, and any modifi-
cations of those agreements, that the Tribunal has directed be registered, and
any such agreements and modifications shall be included in the register for the
periods specified in the orders.
(2) Public register — The register shall be accessible to the public.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 2014, c. 20, s. 389
90. Non-application of sections 45, 77 and 90.1 — Section 45, section

77 as it applies to exclusive dealing, and section 90.1 do not apply in respect of
a specialization agreement, or any modification of such an agreement, that is
registered.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 2009, c. 2, s. 429
Commentary
This section exempts from the conspiracy section (s. 45) and the exclusive dealing section (s.
77) agreements which have been approved and registered. Note that only the registered
agreement entails an exemption from prosecution under section 45. If the parties collude on
matters not in the registered agreement they can still be prosecuted under section 45.
Agreements or Arrangements that Prevent or Lessen

Competition Substantially
90.1 (1) Order — If, on application by the Commissioner, the Tribunal finds
that an agreement or arrangement — whether existing or proposed — be-
tween persons two or more of whom are competitors prevents or lessens, or is
likely to prevent or lessen, competition substantially in a market, the Tribunal
may make an order
(a) prohibiting any person — whether or not a party to the agreement or
arrangement — from doing anything under the agreement or arrange-
ment; or
(b) requiring any person — whether or not a party to the agreement or
arrangement — with the consent of that person and the Commissioner, to
take any other action.
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Part VIII — Reviewable Matters (ss.75-107) S. 90.1(6)(a)
(2) Factors to be considered — In deciding whether to make the finding

referred to in subsection (1), the Tribunal may have regard to the following
factors:
(a) the extent to which foreign products or foreign competitors provide or
are likely to provide effective competition to the businesses of the parties
Act
to the agreement or arrangement;
(b) the extent to which acceptable substitutes for products supplied by the
parties to the agreement or arrangement are or are likely to be available;
(c) any barriers to entry into the market, including
(i) tariff and non-tariff barriers to international trade,
(ii) interprovincial barriers to trade, and
(iii) regulatory control over entry;
(d) any effect of the agreement or arrangement on the barriers referred to
in paragraph (c);
(e) the extent to which effective competition remains or would remain in
the market;
(f) any removal of a vigorous and effective competitor that resulted from
the agreement or arrangement, or any likelihood that the agreement or
arrangement will or would result in the removal of such a competitor;
(g) the nature and extent of change and innovation in any relevant mar-
ket; and
(h) any other factor that is relevant to competition in the market that is or
would be affected by the agreement or arrangement.
(3) Evidence — For the purpose of subsections (1) and (2), the Tribunal
shall not make the finding solely on the basis of evidence of concentration or
market share.
(4) Exception where gains in efficiency — The Tribunal shall not
make an order under subsection (1) if it finds that the agreement or arrange-
ment has brought about or is likely to bring about gains in efficiency that will
be greater than, and will offset, the effects of any prevention or lessening of
competition that will result or is likely to result from the agreement or ar-
rangement, and that the gains in efficiency would not have been attained if the
order had been made or would not likely be attained if the order were made.
(5) Restriction — For the purposes of subsection (4), the Tribunal shall not
find that the agreement or arrangement has brought about or is likely to bring
about gains in efficiency by reason only of a redistribution of income between
two or more persons.
(6) Factors to be considered — In deciding whether the agreement or
arrangement is likely to bring about the gains in efficiency described in sub-
section (4), the Tribunal shall consider whether such gains will result in
257
(b) a significant substitution of domestic products for imported products.

(7) Exception — Subsection (1) does not apply if the agreement or arrange-
ment is entered into, or would be entered into, only by parties each of which is,
in respect of every one of the others, an affiliate.
(8) Exception — Subsection (1) does not apply if the agreement or arrange-
ment relates only to the export of products from Canada, unless the agreement
or arrangement
(b) has restricted or is likely to restrict any person from entering into or
expanding the business of exporting products from Canada; or
(c) has prevented or lessened or is likely to prevent or lessen competition
substantially in the supply of services that facilitate the export of products
from Canada.
(9) Exception — The Tribunal shall not make an order under subsection (1)
in respect of
(a) an agreement or arrangement between federal financial institutions,
as defined in subsection 49(3), in respect of which the Minister of Finance
has certified to the Commissioner
(i) the names of the parties to the agreement or arrangement, and
(ii) the Minister of Finance’s request for or approval of the agree-
ment or arrangement for the purposes of financial policy;
(b) an agreement or arrangement that constitutes a merger or proposed
merger under the Bank Act, the Cooperative Credit Associations Act, the
Insurance Companies Act or the Trust and Loan Companies Act in respect
of which the Minister of Finance has certified to the Commissioner
(ii) the Minister of Finance’s opinion that the merger is in the public
interest, or that it would be in the public interest, taking into account
any terms and conditions that may be imposed under those Acts;
(c) an agreement or arrangement that constitutes a merger or proposed
merger approved under subsection 53.2(7) of the Canada Transportation
Act in respect of which the Minister of Transport has certified to the
Commissioner the names of the parties to the agreement or arrangement;
or
(d) an agreement or arrangement that constitutes an existing or proposed
“arrangement”, as defined in section 53.7 of the Canada Transportation
Act, that has been authorized by the Minister of Transport under subsec-
tion 53.73(8) of that Act and for which the authorization has not been
revoked.
258
Part VIII — Reviewable Matters (ss.75-107) S. 90.1
(10) Where proceedings commenced under section 45, 49, 76, 79

or 92 — No application may be made under this section against a person on
basis of which
Act
45 or 49; or
(b) an order against that person is sought by the Commissioner under
section 76, 79 or 92.
(11) Definition of “competitor” — In subsection (1), “competitor” in-
cludes a person who it is reasonable to believe would be likely to compete with
respect to a product in the absence of the agreement or arrangement.
2009, c. 2, s. 429; 2018, c. 8, s. 115; 2018, c. 10, s. 87
Commentary
Section 90.1 authorises the Competition Tribunal on application by the Commissioner of
Competition to make remedial cease-and-desist orders in connection with agreements be-
tween competitors that substantially lessen or prevent competition. The Tribunal cannot or-
der fines or imprisonment. Private enforcement and damage awards are not possible.
Section 90.1, introduced into the Act in 2010, addresses a gap between mergers (under s. 92)
and criminal cartel conduct (under s. 45). It provides a mechanism to assess arrangements
between competitors that are neither structural nor egregiously illegal but that may neverthe-
less substantially lessen competition.
Senior Competition Bureau staff have stated that most forms of competitor collaboration will
be assessed under section 90.1; only “the most egregious forms of cartel agreement” will be
assessed under the section 45. Assessment of competitive effects under section 90.1 will
likely follow the well-known analytical approach used to assess mergers under section 92
given the close similarity in language between the two sections.
See the commentary to section 96 with respect to the efficiency defence in subsection 90.1
(4); the commentary to subsection 45(6) with respect to the affiliate exception in subsection
90.1(7); and the commentary to subsection 45(8) with respect to the definition of “competi-
tor” in subsection 90.1(11). The s. 90.1 requirement that the agreement be between competi-
tors would exclude from the scope of the provision vertical agreements between suppliers
and customers that may have anti-competitive effects, because they are not competitors.
Similarly, it is unlikely that a completed merger between competitors could be challenged
under s. 90.1, for example, following expiry of the statute of limitations in s. 97, because
after closing there is no longer an agreement between competitors.
Additional information on the Bureau’s approach to the enforcement section 90.1 may be
found in its Competitor Collaboration Guidelines (Ottawa: Competition Bureau, December
2009) as well as various public statements by Bureau officials such as Speaking Notes for
Melanie L. Aitken, Interim Commissioner of Competition Canadian Bar Association, Com-
petition Law Section, 2009 Spring Forum (Toronto, 12 May 2009).
The Canada Transportation Act provides for the review and approval of airline joint venture
arrangements by the Minister of Transport. This process enables the Minister of Transport to
determine whether an agreement is in the public interest and, if so, to exempt the arrange-
ment from several provisions of the Act, including section 90.1. See also the commentary to
subsection 45(6).
259
Case Law
Dow Chemical Canada ULC v. NOVA Chemicals Corporation, 2018 ABQB 482 — The
plaintiff asserted that a contractual restriction was unenforceable as contrary to section 90.1.
The defendant submitted that the Court had no jurisdiction to assess whether an agreement
violates section 90.1, as only the Competition Tribunal has such jurisdiction. No authority
was cited for that submission, and the Court found that an ouster of the jurisdiction of a
provincial superior court must be clear. There is nothing in section 90.1 that indicates such
an ouster. See also the commentary to section 45.
Mergers
91. Definition of “merger” — In sections 92 to 100, “merger” means the

acquisition or establishment, direct or indirect, by one or more persons,
whether by purchase or lease of shares or assets, by amalgamation or by com-
bination or otherwise, of control over or significant interest in the whole or a
part of a business of a competitor, supplier, customer or other person.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
Commentary
The definition of merger in this section is sufficiently broad to include almost any business
acquisition or the establishment of any business, howsoever accomplished. See Part 1 of the
Commissioner’s Merger Enforcement Guidelines for the views of the Commissioner on what
technically constitutes a “merger” under section 91. The definition of merger is also relevant
under sections 45, 49, 79 and 90.1 insofar as the Commissioner cannot commence proceed-
ings in respect of a merger under both the merger provisions of the Act in section 92 and
sections 45, 49, 79 and/or 90.1.
The word “control” is undefined for the purposes of this section. However, subsection 2(4)
describes “for the purpose of this Act” the circumstances under which a corporation or part-
nership are controlled by another person. In any event, the definition of merger includes not
only acquisition of control but also acquisitions of a “significant interest”. The Act is silent
on the meaning of “significant interest,” although the pre-merger notification provisions
clearly contemplate notification in circumstances where less than de jure control is acquired.
The Merger Enforcement Guidelines provide some guidance, describing that the acquisition
or establishment of a “significant interest” in a business will occur “when the person acquir-
ing or establishing the interest obtains the ability to materially influence the economic beha-
viour of the target business.” See Merger Enforcement Guidelines (Ottawa: Competition Bu-
reau, October 2011) at §1.4, §1.5 and §1.6. In practice, the Competition Bureau takes a broad
view of when an interest will be considered to be significant. The factors the Bureau will
consider when determining whether an acquisition or establishment of a “significant inter-
est” constitutes a merger include the relationship between the parties prior to the transaction
or event establishing the interest; the likely subsequent relationship between the parties; the
access that an acquirer has and obtains to confidential business information of the target
business; and evidence of the acquirer’s intentions to affect the behaviour of that business.
The Merger Enforcement Guidelines also suggest that a mere interlocking directorship may
constitute a significant interest, although it is uncertain whether a court would agree if there
has not also been an acquisition of some form of ownership interest. See Merger Enforce-
ment Guidelines (Ottawa: Competition Bureau, October 2011) at §1.16. See also Melanie
Aitken, Assistant Deputy Commissioner of Competition, Addressing Interlocking Director-
260
Part VIII — Reviewable Matters (ss.75-107) S. 92(1)(f)(iii)(A)
ships under the Merger Provisions of the Competition Act (2006 Annual Fall Conference on
Competition Law, Ottawa, Ontario, 28-29 September 2006 at p. 8. A detailed discussion of
“significant interest” is also found in the 1991 Merger Enforcement Guidelines (Ottawa:
Competition Bureau, March 1991) at Part 1.
Case Law
Act
Commissioner of Competition v. C.C.S. Corp., 2011 Comp. Trib. 23 (Competition Trib.) —
The Competition Tribunal rejected the respondents’ assertion that the transaction was not a
“merger” within the meaning of s. 91 because it did not involve the acquisition of a “busi-
ness.” At the time of the acquisition, the acquired company was not operational. The Tribu-
nal held that the statutory description of “business” in subs. 2(1) was not exhaustive and
noted that, unlike the definitions of the word “business” found in statutes such as the Invest-
ment Canada Act, the definition makes no reference to generating profits or revenues. The
Tribunal concluded that the definition includes a business in its developmental stage.
92. (1) Order — Where, on application by the Commissioner, the Tribunal

finds that a merger or proposed merger prevents or lessens, or is likely to pre-
vent or lessen, competition substantially
(a) in a trade, industry or profession,
(b) among the sources from which a trade, industry or profession obtains
a product,
(c) among the outlets through which a trade, industry or profession dis-
poses of a product, or
(d) otherwise than as described in paragraphs (a) to (c),
the Tribunal may, subject to sections 94 to 96,
(e) in the case of a completed merger, order any party to the merger or
any other person
(i) to dissolve the merger in such manner as the Tribunal directs,
(ii) to dispose of assets or shares designated by the Tribunal in such
manner as the Tribunal directs, or
(iii) in addition to or in lieu of the action referred to in subparagraph
(i) or (ii), with the consent of the person against whom the order is
directed and the Commissioner, to take any other action, or
(f) in the case of a proposed merger, make an order directed against any
party to the proposed merger or any other person
(i) ordering the person against whom the order is directed not to pro-
ceed with the merger,
(ii) ordering the person against whom the order is directed not to
proceed with a part of the merger, or
(iii) in addition to or in lieu of the order referred to in subparagraph
(ii), either or both
(A) prohibiting the person against whom the order is directed,
should the merger or part thereof be completed, from doing any
261
S. 92(1)(f)(iii)(A) Competition Act
act or thing the prohibition of which the Tribunal determines to

be necessary to ensure that the merger or part thereof does not
prevent or lessen competition substantially, or
(B) with the consent of the person against whom the order is
directed and the Commissioner, ordering the person to take any
other action.
(2) Evidence — For the purpose of this section, the Tribunal shall not find
that a merger or proposed merger prevents or lessens, or is likely to prevent or
lessen, competition substantially solely on the basis of evidence of concentra-
tion or market share.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.7)
Commentary
Subsection (1)
Subsection 92(1) of the Act permits the Competition Tribunal to make a remedial order
where it finds that a merger “prevents or lessens, or is likely to prevent or lessen, competi-
tion substantially.” Paragraph 91(1)(a) has application to “horizontal” mergers — that is,
mergers between competitors. Paragraphs 91(1)(b) and (c) have application to “vertical’
mergers — that is, mergers between suppliers and customers. Paragraph 91(1)(d) has appli-
cation to “conglomerate” mergers between parties that are neither competitors nor in a cus-
tomer/supplier relationship.
Guidance as to the meaning of section 91 may be found in decisions of courts and the Com-
petition Tribunal (as noted below) as well as the Competition Bureau’s Merger Enforcement
Guidelines (Ottawa: Competition Bureau, October 2011) and Merger Enforcement Guide-
lines as Applied to a Bank Merger (Ottawa: Competition Bureau, October 1998). Case-spe-
cific technical backgrounders, speeches by enforcement officials and other materials from
the Bureau provide additional guidance as to how the agency is likely to interpret the “sub-
stantial lessening or prevention of competition” or “SLPC” test. For a practical overview of
the factors to consider in assessing whether or not there has been an SLPC in a merger case,
see John Bodrug, The Standard of Proof in Merger Cases: Key Factors for the Regulators
and the Courts (Presentation to the Third Annual Merger Control Conference of the British
Institute of International and Comparative Law: December 2004).
In general, an SLPC results only from mergers that are likely to create, maintain or enhance
the ability of the merged entity to exercise market power, unilaterally or in coordination with
other firms. In making a market power assessment, consideration will be given to whether
the merger is likely to provide the merged entity with an ability to materially influence price.
According to the Bureau, “the prevention or lessening of competition is considered to be
“substantial” in two circumstances: the price of the relevant product(s) would likely be mate-
rially higher in the relevant market than it would be in the absence of the merger; and suffi-
cient new entry would not occur rapidly enough to prevent the material price increase, or to
counteract the effects of any such price increase.” (See Merger Enforcement Guidelines at
§2.13.)
262
The Bureau’s analysis of competitive effects falls under two broad theories of competitive
harm:
• A unilateral exercise of market power can occur when a merger enables the merged
firm to profitably sustain higher prices than those that would exist in the absence of the
merger without relying on competitors’ accommodating responses.
Act
• A coordinated exercise of market power can occur when a merger reduces the “com-
petitive vigour” in a market by, for example, removing a particularly aggressive com-
petitor or otherwise enabling or enhancing the ability of the merged firm to coordinate
its behaviour with that of its competitors. In these situations, higher post-merger prices
are profitable and sustainable because other competitors in the market have accommo-
dating responses.
Although most problematic mergers are horizontal, some are vertical, and in rare cases the
Bureau may also evaluate conglomerate mergers. For an overview of the Bureau’s approach
to vertical mergers, see Part 11 of the Bureau’s Merger Enforcement Guidelines and the
Competition Bureau Submission to the OECD Competition Committee Roundtable on “Ver-
tical Mergers in the Technology, and Media and Telecom Sector” (June 2019). For an over-
view of the Bureau’s approach to conglomerate mergers, see Part 11 of the Competition
Bureau’s Merger Enforcement Guidelines and the International Competition Network’s
Merger Working Group Teleseminar on Conglomerate Mergers (October 2019).
Section 93 sets out factors to be considered by the Tribunal in determining whether a merger
is likely to result in an SLPC. Where a merger is likely to create, maintain or enhance the
ability of the merged entity to exercise market power, the Commissioner will ordinarily seek
a remedial order from the Competition Tribunal or enter into a Consent Agreement with the
merger parties. The standard for achieving an acceptable remedy was set out by the Supreme
Court of Canada in Canada (Director of Investigation and Research) v. Southam Inc. In that
case, the Court concluded that “the appropriate remedy for a substantial lessening of compe-
tition is to restore competition to the point at which it can no longer be said to be substan-
tially less than it was before the merger.” As the Court noted in Southam, “some lessening of
competition following a merger is tolerated, because the Act proscribes only a substantial
lessening of competition.” In other words, the remedy need not restore the pre-merger com-
petitive balance, but merely eliminate the “substantial” lessening or prevention of competi-
tion. Further guidance as to the Competition Bureau’s approach to merger remedies can be
found in Information Bulletin on Merger Remedies in Canada (Ottawa: Competition Bureau,
2006).
The Tribunal’s power to make remedial orders in respect of a merger is found primarily in
subparagraphs 92(1)(e)(iii) and 92(1)(f)(iii).
• In the case of a completed merger, subparagraph 92(1)(e)(iii) provides that the Tribunal
may order that the merger be dissolved (i.e., unwound) or that there be a divesture of
assets or shares. With the consent of the person against whom an order is be to issued
and the Commissioner, the Tribunal may also order that “any other action” be taken.
• In the case of a proposed merger, subparagraph 92(1)(f)(iii) provides that the Tribunal
may order a person not to proceed with all or part of a merger or, where a merger is to
be completed in whole or part, prohibiting that person against from doing any act or
thing necessary to ensure that there is no prevention or lessening competition substan-
tially. With the consent of the person against whom an order is be to issued and the
Commissioner, the Tribunal may also order that “any other action” be taken.
In effect, subparagraphs 92(1)(e)(iii) and 92(1)(f)(iii) allow the Tribunal to impose “struc-
tural” remedies only. The consent of both the respondent(s) and the Commissioner is re-
263
quired for the Tribunal to make a “behavioural” order unless it is ancillary to a structural
order. A further discussion of structural, quasi-structural and behavioural remedies can be
found in the Bureau’s Information Bulletin on Merger Remedies in Canada.
Fully litigated merger cases in Canada are rare. The Competition Tribunal has adjudicated or
resolved through mediation six mergers under subsection 92(1), with most decisions being
subject to appellate review:
• Commissioner of Competition v. Parkland Industries Ltd. (2015) — The Commissioner
alleged that an acquisition would substantially lessen competition in 14 local markets
for the retail supply of gasoline. Following mediation, the matter was resolved through
a consent agreement. Parkland agreed to divest either a station or gasoline supply
agreement in six markets and not increase profit margin earned on the wholesale sup-
ply of gasoline in two additional markets.
• Commissioner of Competition v. CCS Corp.(Tervita) (2010–2015) — The Commis-
sioner alleged that a completed acquisition was likely to substantially prevent competi-
tion in secure landfill services in Northeastern British Columbia. The Commissioner
sought dissolution of the transaction or a divestiture. The Tribunal rejected the Com-
missioner’s application for dissolution of the merger and instead ordered the divestiture
of the relevant landfill. The Federal Court of Appeal upheld the Tribunal decision. On
appeal, the Supreme Court of Canada accepted CCS’ efficiencies arguments despite
agreeing with the Tribunal and Federal Court of Appeal that the merger would likely
result in a substantial lessening of competition, allowing the merger.
• Commissioner of Competition v. Canadian Waste Services Holdings Inc.
(2000–2005) — The Commissioner alleged that an acquisition was likely to substan-
tially lessen and prevent competition in a local non-hazardous waste market. The Com-
petition Tribunal agreed and ordered the divestiture of a landfill. The order was upheld
on appeal.
• Commissioner of Competition v. Superior Propane Inc. (1998–2003) — The Commis-
sioner alleged that an acquisition of a supplier of propane products was likely to lessen
competition substantially in many local markets. The Tribunal ultimately declined to
make a remedial order on the basis of the efficiencies defence.
• Director of Investigation and Research) v. Southam Inc. (1989–1997) — The Director
alleged that Southam’s acquisition of certain community newspapers and other publica-
tions would result in a lessening or prevention of competition. The Tribunal found a
substantial lessening in competition in one aspect of the case, the real estate print ad-
vertising market in the North Shore of Vancouver. It ordered a divestiture of one of two
acquired real estate print advertising publications. On appeal to the Supreme Court of
Canada, the divestiture order was affirmed. (As noted above, the Supreme Court of
Canada held that the appropriate remedy in merger cases is to restore competition to
the point at which it can no longer be said to be substantially less than it was before the
merger.).
• Director of Investigation & Research v. Hillsdown Holdings (Canada) Ltd.
(1990–1992) — The Director alleged that an acquisition was likely to result in a sub-
stantial lessening of competition in the provision of rendering services for non-captive
red meat rendering services. The Tribunal “was not convinced,” citing amongst other
things the possibility of entry from firms bordering the relevant geographic market. No
remedy was ordered.
264
A large number of merger transactions have been settled on consent. See, for example:
Commissioner of Competition v. CCS Corporation, 2011 Comp. Trib. 4 (Competition Trib.);
Canada (Commissioner of Competition) v. Abitibi-Consolidated Inc., 2002 Comp. Trib. 3
(Competition Trib.); Canada (Commissioner of Competition) v. United Grain Growers Lim-
ited, 2002 Comp. Trib. 1 (Competition Trib.); Canada (Commissioner of Competition) v. Air
Canada, 2001 Comp. Trib. 4 (Competition Trib.); Canada (Commissioner of Competition) v.
Act
Canadian Waste Services Holdings Inc., 2000 Comp. Trib. 5 (Competition Trib.);
Commissioner of Competition v. British American Tobacco, 1999 Comp. Trib. 1;
Commissioner of Competition v. ADM Agri-Industries Ltd., 1997 Comp. Trib. 2; Director of
Investigation and Research v. Dennis Washington, 1996 Comp. Trib. 1; Director of
Investigation and Research v. Air Canada, 1988 Comp. Trib. 1; Director of Investigation
and Research v. Imperial Oil Limited, 1989 Comp. Trib. 1; and Director of Investigation and
Research v. Asea Brown Boveri Inc., 1989 Comp. Trib. 1.
The Commissioner has also withdrawn applications after transactions were abandoned. See,
for example: Commissioner of Competition v. Aviscar Inc., 2015 Comp. Trib. 12 (Competi-
tion Trib.); and Commissioner of Competition v. Saskatchewan Wheat Pool Inc., 2006
Comp. Trib. 9 (Competition Trib.).
As noted above, a contested merger was resolved through a Tribunal-supervised mediation
process in Commissioner of Competition v. Parkland Industries Ltd, 2015 Comp. Trib. 4
(Competition Trib.). The Tribunal thereafter released a practice direction regarding this me-
diation process (see Competition Tribunal, Practice Direction Regarding Mediation (Ot-
tawa: Competition Tribunal, 2016)).
In 2016, the Bureau issued a template document for use as a form of Consent Agreement, to
be filed with the Competition Tribunal to resolve concerns the Bureau may have with pro-
posed mergers. The Bureau’s stated purpose is to provide formal guidance for the legal and
business community “with better insight into the Bureau’s expectations when negotiating
measures to address competitive issues likely to arise from a proposed merger.”
Subsection (2)
Subsection 92(2) provides that the Competition Tribunal cannot find that a merger results in
an SLPC based solely on evidence of market shares or concentration. However, market
shares are clearly a preliminary and helpful indicator of whether or not a proposed transac-
tion could result in an SPLC.
The Bureau has established thresholds to identify and distinguish mergers that are unlikely to
have anticompetitive consequences from those that require a more detailed analysis.
• When the post-merger market share of the merged firm would be less than 35 percent,
the Commissioner generally will not challenge a merger on the basis of a concern re-
lated to the unilateral exercise of market power.
• When the post-merger market share of the four largest firms would be less than 65
percent or where the post-merger market share of the merged firm would be less than
10 percent, the Commissioner generally will not challenge a merger on the basis of a
concern related to a coordinated exercise of market power.
See Merger Enforcement Guidelines (Ottawa: Competition Bureau, October 2011) at §5.9.
Despite the express prohibition on relying solely on market shares, the Bureau tends to rely
very heavily (if not exclusively) on market shares in mergers in the retail sector, such as
branch banking, grocery and retail gasoline.
265
Case Law
Commissioner of Competition v. Thoma Bravo, LLC, 2019 Comp. Trib. 2 — Thoma Bravo,
LLC, a private equity firm, acquired Wrangler Holdings Inc., which offered Val Nav, busi-
ness-critical reserve reporting and valuation software for oil and gas producers. One of
Thoma Bravo’s other portfolio companies offered MOSAIC, a competing software to Val
Nav. Virtually all oil and gas producers used either Val Nav or MOSAIC. The Commis-
sioner challenged the acquisition after it had closed and, in his application, described the
proposed transaction as a “merger to monopoly.” The matter was ultimately resolved on
consent and prior to a hearing on the merits, with Thoma Bravo agreeing to sell MOSAIC to
a purchaser acceptable to the Commissioner.
Commissioner of Competition v. Parkland Industries Ltd., 2015 Comp. Trib. 4 — The re-
spondent Parkland sought to merge with a competitor, Pioneer, a retail supplier of gasoline.
The Commissioner brought an application pursuant to section 92 alleging that the merger
would substantially lessen competition in 14 local markets in Ontario and Manitoba. The
Tribunal subsequently issued the first contested injunction in a merger application pursuant
to section 104, ordering a hold separate that prevented Parkland from implementing the
transaction in six local markets in Ontario and Manitoba, pending the outcome of the litiga-
tion. Following mediation, the matter was resolved through a consent agreement. Parkland
agreed to divest either a station or gasoline supply agreement in six markets and not increase
profit margin earned on the wholesale supply of gasoline in two additional markets.
Tervita Corp. v. Canada (Commissioner of Competition), 2015 SCC 3 (S.C.C.); reversing
Canada (Commissioner of Competition) v. CCS Corp., 2013 FCA 28, 2013 CarswellNat
1400, 2013 CarswellNat 6936, (sub nom. Tervita Corp. v. Canada (Commissioner of Com-
petition)) [2014] 2 F.C.R. 352, 360 D.L.R. (4th) 717, (sub nom. Tervita Corp. v.
Commissioner of Competition) 446 N.R. 261 (F.C.A.); affirming Commissioner of
Competition v. CCS Corp., 2012 Comp. Trib. 14, 2012 CarswellNat 4409, [2012] C.C.T.D.
No. 14 (Competition Trib.) — The Commissioner alleged that a completed acquisition was
likely to substantially prevent future competition in secure landfill services in Northeastern
British Columbia. The Commissioner sought an order to unwind the transaction or divest
Babkirk Land Services, a wholly owned subsidiary of CCS Corporation that held land in
Northeastern British Columbia and a permit to operate a solid hazardous waste landfill there.
The Tribunal held that the merger was likely to substantially prevent competition. However,
it rejected the application for dissolution and instead ordered a divestiture on the basis that
the latter solution was less intrusive, but still an effective remedy. The Tribunal’s decision
was affirmed on appeal, but ultimately reversed by the Supreme Court, which accepted
Tervita’s efficiencies defence and allowed the merger.
To determine whether a merger gives rise to a substantial prevention or lessening of compe-
tition, the Supreme Court established that the Tribunal must examine the relevant market’s
condition to assess the competitive landscape that would foreseeably exist “but for” the
merger. The forward-looking “but for” test consists of three steps: (i) identifying the poten-
tial competitor(s) the merger would prevent from independently entering the market (which
will typically be one of the merged parties); (ii) assessing whether, but for the merger, the
relevant potential competitor(s) would have likely entered the market (the likelihood of entry
of the potential competitor must be more than a mere possibility); and (iii) determining
whether the effect of this market entry would likely be substantial (which requires a case-by-
case analysis of a number of factors including price, output, the plans and assets of the merg-
ing party, current and expected market conditions, and other factors listed in s. 93 of the
Competition Act). A “discernible” time frame for a potential competitor’s entry is one that
266
does not extend too far into the future, does not depend on too many contingencies, and does
not stray too far from the lead time required to enter a market due to barriers to entry.
The Supreme Court also clarified that the Commissioner is required to quantify by estima-
tion all quantifiable anti-competitive effects. These estimates must be grounded in evidence
that can be challenged and weighed by the court. An anti-competitive effect can only be
assessed qualitatively if it is unquantifiable (such as the lessening of service, or reduction of
Act
quality). If the Commissioner fails to quantify a quantifiable anti-competitive effect, the ef-
fect will be considered to have zero impact.
Canada (Commissioner of Competition) v. Canadian Waste Services Holdings Inc. (2001),
11 C.P.R. (4th) 425 (Competition Trib.); additional reasons (2001), 15 C.P.R. (4th) 5 (Com-
petition Trib.); affirmed 2003 FCA 131, 2003 CarswellNat 2986, 2003 CarswellNat 643
(Fed. C.A.); leave to appeal refused 2004 CarswellNat 6 (S.C.C.) — The respondent (CWS)
was the largest waste management company in Canada, owning or controlling six landfill
sites in southern Ontario. When it acquired the solid waste business of its major competitor
in southern Ontario, the Commissioner applied for an order under section 92 requiring the
divestiture of the landfill facility acquired with the solid waste business. The application was
granted as the merger would result in the removal of a vigorous and effective competitor to
the respondent in the disposal of industrial, commercial and institutional (ICI) waste in
southern Ontario. The acquisition would give the respondent control over an estimated 70%
of the landfill capacity in southern Ontario capable of taking ICI waste from the Greater
Toronto Area, enhancing the respondent’s market power and substantially lessening compe-
tition in the disposal of ICI waste. On appeal, the Court held that CWS had failed to establish
that the Tribunal made any reviewable error in its conclusion that the merger would likely
result in a substantial lessening of competition. See also the commentary to section 106 for a
discussion of a subsequent application by CWS for an order rescinding or varying the divest-
iture order pursuant to section 106 of the Act.
CarswellNat 1906 (S.C.C.) — The Commissioner applied for an order under s. 92 to dissolve
the merger of two companies which marketed propane and related appliances and services,
or otherwise remedy the substantial prevention or lessening of competition. The Commis-
sioner alleged that the merger would create a dominant national propane marketer, and in
many markets, a dominant local propane marketer. The Tribunal found that the legal test to
be applied under s. 92 of the Act was whether the merger prevented or lessened, or was
likely to prevent or lessen, competition substantially. The Tribunal did not agree that a
merger which merely preserved existing power over price should be seen as lessening com-
petition. The Tribunal, however, found that the merger was likely to lessen competition in
Atlantic Canada and in many other local markets across Canada. The Tribunal then pro-
ceeded to rely on the s. 96 efficiency exception in dismissing the application. On appeal by
the Commissioner, the Federal Court of Appeal ordered a redetermination of the application
as the Tribunal erred in interpreting s. 96. The word “effects” in s. 96 should be interpreted
to include all anti- competitive effects to which a merger in fact gave rise.
Upon redetermination, the Tribunal applied the Federal Court of Appeal’s holding and found
that the efficiencies exemption still applied to dismiss the Commissioner’s application (see
Canada (Commissioner of Competition) v. Superior Propane Inc., 2002 Comp. Trib. 16
(Competition Trib.); affirmed 2003 FCA 53 (Fed. C.A.)).
(Competition Trib.) — The Competition Tribunal ordered the divesting of certain assets in
267
March, 1993. The divestiture order gave the respondents 180 days to finalize the divestiture
after which time the Director would apply for the appointment of a trustee to carry out the
divestiture. In the intervening years, the order has been stayed due to a series of appeals.
Following the completion of appeals, a variation application was brought about 130 days
into the 180-day divestiture period. The respondents sought an extension of an additional 50
days. The Director cross-applied for an order appointing a trustee. The motions were granted
in part. Even though the original 180-day divestiture period had expired, the variation appli-
cation was not frivolous or vexatious. In granting the extension of 50 days, the respondents
would have the benefit of the full 180-day period by discounting the period during which the
variation application was outstanding. In regard to the Director’s motion for the appointment
of a trustee, the parties consented to an order which would have the effect of appointing the
trustee without the need of further steps on the day following the expiry of the 50-day
period.
Canada (Director of Investigation & Research) v. ADM Agri-Industries, Ltd. (May 8, 1998)
(Competition Trib.) — The respondent purchased the flour milling assets of a competitor. In
an application brought pursuant to ss. 92 and 105, the Director alleged that the acquisition
resulted in a substantial lessening of competition in the supply of bulk hard wheat bakery
flour in the Quebec and Atlantic Canada markets. The Director and respondent agreed on the
terms of a consent order which required the respondent to sell the mill acquired from the
competitor in Quebec together with a supply agreement which would entitle the purchaser of
the mill to buy up to a specified amount of bulk hard wheat bakery flour from the respondent
for three years. The respondent was given 15 months to sell the mill. In approving the con-
sent order, the Tribunal was satisfied that the order would result in a situation where the
substantial lessening of competition identified by the Director would, in all likelihood, be
eliminated.
(Competition Trib.) — In determining an appropriate remedy under s. 92 of the Act, the
primary concern is the protection of the public interest and not the preservation of private
contractual entitlements. However, it is also reasonable to make the order on terms that are
the least harmful to all parties consistently with protecting the public interest in competition.
In this follow-up to (1993), 49 C.P.R. (3d) 417 (Fed. C.A.), reversing (1993), 49 C.P.R. (3d)
7 (Competition Trib.), leave to appeal to the S.C.C. refused (1993), 49 C.P.R. (3d) ix (note)
(see cases under s. 106 of the Competition Tribunal Act), it was also held that in determining
whether a merger will likely reduce competition, the intent of the parties is irrelevant, as is
the degree of care owed by anyone. Section 92 of the Act is concerned only with the factual
consequences that a merger has on competition.
(Competition Trib.); additional reasons (1993), 48 C.P.R. (3d) 224 (Competition Trib.); re-
versed [1995] 3 F.C. 557, 21 B.L.R. (2d) 1, 63 C.P.R. (3d) 1, 127 D.L.R. (4th) 263, (sub
nom. Director of Investigation & Research, Competition Act v. Southam Inc. (No. 1)) 185
N.R. 321 (Fed. C.A.); reversed 1997 CarswellNat 368, 1997 CarswellNat 369, [1997] 1
S.C.R. 748, 209 N.R. 20 (S.C.C.) — Southam was the owner of two daily newspapers in
Vancouver. Southam acquired a controlling interest in an additional 13 community newspa-
pers, a real estate advertising publication called Real Estate Weekly, and various printing
and distribution facilities. The Tribunal held that, given the existence of other advertising
options in the form of free-standing flyers and the conditions of entry, it was unlikely that
advertisers would be disadvantaged by Southam’s acquisition of any of the community
newspapers. However, the Tribunal also held that Southam’s acquisition of Real Estate
Weekly, combined with its purchase of a specific community newspaper called North Shore
268
News, would substantially lessen competition in the print real estate advertising market on
Vancouver’s North Shore. The Tribunal further held that entry-level barriers were not suffi-
ciently low to conclude that the acquisition did not lessen competition substantially and was
not likely to do so.
In a subsequent hearing dealing with the appropriate remedy ((1992), 47 C.P.R. (3d) 240
(Competition Trib.); additional reasons 1993 CarswellNat 2476 (Competition Trib.); af-
Act
firmed 1995 CarswellNat 709 (Fed. C.A.); affirmed 1997 CarswellNat 368, 1997 Car-
swellNat 369 (S.C.C.)), Southam proposed to sell the real estate section of one of its newspa-
pers as an alternative to a full divestiture. The Tribunal held that this alternative was not
sufficient. The Tribunal noted that the paramount goal of any section 92 remedy is to restore
the pre-merger competitive situation in the affected market, and not to punish the offender.
However, so long as the remedy does not seek to go beyond the pre-merger situation, it will
not be considered punitive. Further, the burden is on the respondent to show that the remedy
it favours will be effective and have a reasonable chance of success. In Southam’s case, it
had failed to meet this burden, meaning Southam was still required to divest itself of either
North Shore News or Real Estate Weekly.
On appeal, the Federal Court of Appeal reversed the divestiture order after holding that the
definition of the relevant market and the tests to be applied in determining the relevant mar-
ket are questions of law. In determining the relevant product market, the issue is whether
products are close substitutes. Products will be close substitutes if buyers will switch from
one to the other due to a change in price. In establishing this, statistical evidence of buyer
price sensitivity and anecdotal evidence constitute direct evidence. “Indirect” evidence, such
as functional interchangeability and industry views and behaviour, may also be useful where
direct evidence is not conclusive. The Federal Court of Appeal found that the two newspa-
pers were in the same product market but referred the matter back to the Tribunal to decide
whether the merger would substantially lessen competition, including a consideration of the
factors in section 93. The Federal Court of Appeal further dismissed Southam’s appeal of the
Tribunal’s finding that Southam’s proposed alternative remedy to the divestiture was inef-
fective. The Tribunal was entitled to deference on this question of mixed fact and law.
The Supreme Court reversed the Federal Court of Appeal’s decision and affirmed the Tribu-
nal’s original divestiture order. The Supreme Court noted that the questions before the Tribu-
nal were questions of mixed fact and law, rather than pure law as the Federal Court of Ap-
peal had held. Therefore, the Tribunal’s decisions were subject to the standard of
reasonableness. The Supreme Court also noted that the appropriate remedy in merger cases
is to restore competition to the point at which it can no longer be said to be substantially less
than it was before the merger.
The Tribunal’s original divestiture order gave Southam 180 days to finalize the divestiture
after which time the Director would apply for the appointment of a trustee to carry out the
divestiture. In the intervening years, the order was stayed due to the series of appeals. Fol-
lowing the completion of appeals, Southam brought a variation application about 130 days
into the 180-day divestiture period ((1998), 78 C.P.R. (3d) 428 (Competition Trib.)).
Southam sought an extension of an additional 50 days. The Director cross-applied for an
order appointing a trustee. The Tribunal granted the motions in part. Even though the origi-
nal 180-day divestiture period had expired, the variation application was not frivolous or
vexatious. In granting the extension of 50 days, Southam would have the benefit of the full
180-day period by discounting the period during which the variation application was out-
standing. Regarding the Director’s motion for the appointment of a trustee, the parties con-
sented to an order which would have the effect of appointing the trustee without the need of
further steps on the day following the expiry of the 50-day period.
269
Canada (Director of Investigation & Research) v. Hillsdown Holdings (Canada) Ltd. (1992),
41 C.P.R. (3d) 289 (Competition Trib.) — Hillsdown acquired a competitor meat rendering
company. The Director alleged that the acquisition was likely to result in a substantial les-
sening of competition in the provision of rendering services for non-captive red meat. The
Tribunal was ultimately unconvinced, citing the possibility of entry from firms bordering the
relevant geographic market. Additionally, the Tribunal noted that, in certain cases, market
share is not necessarily a reliable determinant of market power. In this case, there was re-
duced demand for meat rendering services, meaning other firms in the same market had
excess capacity. These firms would therefore provide adequate competitive pressure on Hill-
sdown and restrain its ability to raise prices. A divestiture order will not be issued if it will
not effectively preserve a significant degree of competition in the relevant market for a suffi-
cient period of time to justify its issuance. Here, a divestiture order was not necessary.
293 (C.A.); reversing (1990), (sub nom. Alex Couture Inc. v. Canada (Procureur général))
47 B.L.R. 154, 69 D.L.R. (4th) 635, 30 C.P.R. (3d) 486 (C.S.); leave to appeal to S.C.C.
refused (1992), 91 D.L.R. (4th) vii (note), 42 C.P.R. (3d) v (note), 141 N.R. 396 (note)
(S.C.C.) — Sections 92(1)(e)(ii) and 92(1)(f)(i) and (ii) of the Act do not violate the freedom
of association guaranteed by s. 2(d) of the Charter. The purpose of the former provisions is
not to prevent free association, but to prevent illicit mergers, which are not covered by s.
2(d) of the Charter.
Dir. of Investigation & Research v. Palm Dairies Ltd. (1986), 12 C.P.R. (3d) 425 (Comp.
Trib.) — Negotiated settlements may be preferable to those that are imposed, but the consent
of parties to the exercise of jurisdiction of a tribunal does not give a tribunal jurisdiction if it
does not otherwise exist. Hence, where there was some question whether a merger had been
substantially completed before the coming into force of the Act and hence whether it was
within the jurisdiction of the Tribunal, in accordance with s. 94(a) there should be fuller
consideration of the issue.
Furthermore, the Tribunal should not endorse a consent order whose terms are unenforceable
or ineffective. The Tribunal accordingly ordered further argument on these issues with re-
spect to an agreement for which the Tribunal’s approval was sought.
93. Factors to be considered regarding prevention or lessening

of competition — In determining, for the purpose of section 92, whether or
not a merger or proposed merger prevents or lessens, or is likely to prevent or
lessen, competition substantially, the Tribunal may have regard to the follow-
ing factors:
(a) the extent to which foreign products or foreign competitors provide or
are likely to provide effective competition to the businesses of the parties
to the merger or proposed merger;
(b) whether the business, or a part of the business, of a party to the
merger or proposed merger has failed or is likely to fail;
(c) the extent to which acceptable substitutes for products supplied by the
parties to the merger or proposed merger are or are likely to be available;
(d) any barriers to entry into a market, including
270
Part VIII — Reviewable Matters (ss.75-107) S. 94(c)
(iii) regulatory control over entry,

and any effect of the merger or proposed merger on such barriers;
(e) the extent to which effective competition remains or would remain in a
market that is or would be affected by the merger or proposed merger;
(f) any likelihood that the merger or proposed merger will or would result
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in the removal of a vigorous and effective competitor;
(g) the nature and extent of change and innovation in a relevant market;
and
(h) any other factor that is relevant to competition in a market that is or
would be affected by the merger or proposed merger.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
Commentary
The Competition Bureau’s Merger Enforcement Guidelines (Ottawa: Competition Bureau,
October 2011) contains an extensive discussion of section 93. See, in particular, Part 6 —
Anti-Competitive Effects, Part 7 — Entry, Part 8 — Countervailing Power and Part 9 —
Failing Firms and Exiting Assets.
In 2020, the Competition Bureau released a position statement in relation to subsection 93(b)
and the failing firm analysis it performed in relation to the acquisition of Total Metal Recov-
ery Inc. (TMR) by American Iron & Metal Inc. (AIM). The Competition Bureau concluded
that TMR’s assets were likely to exit the market, no competitively preferable buyer could be
found and concluded that no enforcement action should be taken in this case. See Competi-
tion Bureau, Position Statement, “Competition Bureau statement regarding the acquisition of
Total Metal Recovery (TMR) Inc. by American Iron & Metal Company Inc.” (29 April
2020).
For a further review of the failing firm defence in Canada, see also Richard Elliott and Jim
Dinning, Failing Firm Analysis in Canadian Merger Review, CBA Competition Law 2009
Spring Forum, Toronto, 12 May 2009.
94. Exception — The Tribunal shall not make an order under section 92 in
respect of
(a) a merger substantially completed before the coming into force of this
section;
(b) a merger or proposed merger under the Bank Act, the Cooperative
Credit Associations Act, the Insurance Companies Act or the Trust and
Loan Companies Act in respect of which the Minister of Finance has certi-
fied to the Commissioner the names of the parties and that the merger is
in the public interest — or that it would be in the public interest, taking
into account any terms and conditions that may be imposed under those
Acts;
(c) a merger or proposed merger approved under subsection 53.2(7) of
the Canada Transportation Act and in respect of which the Minister of
Transport has certified to the Commissioner the names of the parties; or
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S. 94(d) Competition Act
(d) a merger or proposed merger that constitutes an existing or proposed

“arrangement”, as defined in section 53.7 of the Canada Transportation
Act, that has been authorized by the Minister of Transport under subsec-
tion 53.73(8) of that Act and for which the authorization has not been
revoked.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1991, c. 45, s. 549; 1991, c. 46, ss. 592, 593;
1991, c. 47, s. 716; 1999, c. 2, s. 37(z.8); 2000, c. 15, s. 14; 2001, c. 9, s. 579; 2007, c.
19, s. 62; 2018, c. 10, s. 88
Commentary
There has been one occasion where a proposed merger was approved by the Governor in
Council under subsection 53.2(7) of the Canada Transportation Act, thereby invoking the
exception contemplated in paragraph 94(c). In 2018, First Air and Canadian North, two air-
lines that provided passenger and cargo services to, from and within Nunavut and the North-
west Territories, announced a proposed merger. The Commissioner determined that the pro-
posed merger would likely result in significant competition concerns with respect to the
provision of scheduled passenger and cargo services on all but one of the Parties’ overlap-
ping routes and characterized the proposed merger as a “merger to monopoly” on such
routes. See Report to the Minister of Transport and the Parties to the Transaction Pursuant
to Subsection 53.2(2) of the Canada Transportation Act — Proposed Merger of Bradley Air
Services Limited, d.b.a. First Air, and Canadian North Inc. (Ottawa: Competition Bureau,
February 2019). The Bureau report did not (consistent with the legislative scheme set out in
the legislation) concerns whether or what remedies could alleviate its substantive concerns.
The merger was ultimately approved subject to conditions including: limiting fare increases;
maintaining weekly schedule options on all routes; and ensuring access by new entrants to
cargo facilities. In its press release, Transport Canada noted that the decision to “[approve]
the merger with terms and conditions [struck] a balance between any public interest consid-
erations and the need to have a more efficient and financially sustainable northern air car-
rier.” These public interest considerations included employment in Nunavut and the North-
west Territories and Inuit representation, training and development.
The Canada Transportation Act also provides for the review and approval of airline joint
venture arrangements by the Minister of Transport. This process enables the Minister of
Transport to determine whether an agreement is in the public interest and, if so, to exempt
the arrangement from several provisions of the Act. See also the commentary to subsection
45(6).
95. (1) Exception for joint ventures — The Tribunal shall not make an
order under section 92 in respect of a combination formed or proposed to be
formed, otherwise than through a corporation, to undertake a specific project
or a program of research and development if
(a) a project or program of that nature
(i) would not have taken place or be likely to take place in the ab-
sence of the combination, or
(ii) would not reasonably have taken place or reasonably be likely to
take place in the absence of the combination because of the risks in-
volved in relation to the project or program and the business to
which it relates;
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Part VIII — Reviewable Matters (ss.75-107) S. 96(3)
(b) no change in control over any party to the combination resulted or

would result from the combination;
(c) all the persons who formed the combination are parties to an agree-
ment in writing that imposes on one or more of them an obligation to
contribute assets and governs a continuing relationship between those
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parties;
(d) the agreement referred to in paragraph (c) restricts the range of activ-
ities that may be carried on pursuant to the combination, and provides
that the agreement terminates on the completion of the project or pro-
gram; and
(e) the combination does not prevent or lessen or is not likely to prevent
or lessen competition except to the extent reasonably required to under-
take and complete the project or program.
(2) Limitation — For greater certainty, this section does not apply in respect
of the acquisition of assets of a combination.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
Commentary
This section provides that joint ventures (as defined) are exempt from Competition Tribunal
orders under section 92. It is the substantive corollary to the procedural exemption in section
112, pursuant to which joint ventures are exempted from the pre-merger notification obliga-
tion in Part IX.
The exemption in section 95 only applies to joint ventures that are non-corporate “combina-
tions” created pursuant to agreements which must provide for the termination of the joint
venture at the end of the project. That is, there must be a lack of permanency in the project.
Although the word “combination” is not defined in the Act, it covers non-corporate entities,
such as partnerships and trusts.
96. (1) Exception where gains in efficiency — The Tribunal shall not
make an order under section 92 if it finds that the merger or proposed merger
in respect of which the application is made has brought about or is likely to
bring about gains in efficiency that will be greater than, and will offset, the
effects of any prevention or lessening of competition that will result or is likely
to result from the merger or proposed merger and that the gains in efficiency
would not likely be attained if the order were made.
(2) Factors to be considered — In considering whether a merger or pro-
posed merger is likely to bring about gains in efficiency described in subsec-
tion (1), the Tribunal shall consider whether such gains will result in
(3) Restriction — For the purposes of this section, the Tribunal shall not
find that a merger or proposed merger has brought about or is likely to bring
273
about gains in efficiency by reason only of a redistribution of income between

two or more persons.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
Commentary
Section 96 prevents the Competition Tribunal from making a remedial order under section
92 where a merger results in efficiency gains that are greater than and offset any anticompe-
titive effects.
This “trade-off” analysis — which assesses whether the likely efficiency gains from the
merger outweigh the likely anticompetitive effects — has been the subject of significant
litigation.
The Superior Propane line of cases established that the Competition Tribunal may employ a
“modified balancing weights” approach to the trade-off assessment between efficiencies and
anticompetitive effects. Under that approach, any socially adverse portion of the wealth
transfer from consumers to producers may be considered an anti-competitive effect. (Wealth
transfers that are not socially adverse are treated as neutral.) For example, the transfer of
wealth from low income consumers or government entities would be considered an anti-
competitive effect rather than an efficiency. The transfer of wealth from a wealthy consumer
to a wealthy producer would be neutral.
• In Superior I, the Competition Tribunal initially adopted a “total surplus” standard for
the trade-off analysis, treating a dollar in the hands of a consumer and a producer as
equal. See Canada (Commissioner of Competition) v Superior Propane Inc, 2000
Comp. Trib. 15, 7 C.P.R. (4th) 385.
• In Superior II, the Federal Court of Appeal held that the total surplus standard did not
adequately reflect the various purposes of the Competition Act. The Court did not pre-
scribe an approach for the Tribunal to adopt. However, it observed that a “balancing
weights” standard, which would consider the relative importance of gains or losses to
producers or consumers, would be an acceptable approach for the Tribunal to adopt.
See Canada (Commissioner of Competition) v. Superior Propane Inc., 2000 Comp.
Trib. 15, 7 C.P.R. (4th) 385 (Competition Trib.); reversed 2001 CarswellNat 702, 2001
CarswellNat 2092 (Fed. C.A.); leave to appeal refused 2001 CarswellNat 1905, 2001
CarswellNat 1906 (S.C.C.).
• In Superior III, the Tribunal adopted a modified balancing weights standard, pursuant
to which efficiencies and anti-competitive effects ought to be given weights, with so-
cially adverse wealth transfers being considered an anti-competitive effect, as de-
scribed above. If the weighted efficiencies are greater than and offset the weighted
anticompetitive effects, the defence will apply. See Canada (Commissioner of
Competition) v. Superior Propane Inc., 2002 Comp. Trib. 16, 18 C.P.R. (4th) 417
(Competition Trib.); affirmed 2003 CarswellNat 1241, 2003 CarswellNat 217 (Fed.
C.A.).
• In Superior IV, the Federal Court of Appeal affirmed that the modified balancing
weights approach was an appropriate methodology for the Tribunal to use. See Canada
(Commissioner of Competition) v. Superior Propane Inc., 2003 FCA 53 (Fed. C.A.).
In the more recent CCS (Tervita) case, the Supreme Court of Canada observed that the total
surplus standard should be the analytical starting point, but that the Tribunal will also “deter-
mine whether there are likely to be any socially adverse effects associated with the merger”
if such arguments are put forth by the Commissioner. “If so, it will be necessary to determine
274
how to treat the wealth transfer that will be associated with any adverse price effects.” The
case also established that in making the trade-off analysis, the Tribunal must weigh and
balance both the quantitative and qualitative aspects of a merger. The Court explained that
the balancing test under section 96 may be framed as a two-step inquiry. First, the quantita-
tive efficiencies of the merger at issue should be compared against the quantitative anti-
competitive effects. Under the second step, the qualitative efficiencies should be balanced
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against the qualitative anti-competitive effects, and a final determination must be made as to
whether the total efficiencies offset the total anticompetitive effects of the merger at issue.
The Competition Bureau bears the burden of establishing the anti-competitive effects of a
merger and the merging parties bear the burden of establishing any relevant efficiency gains
and that such efficiency gains are likely to be greater than, and will offset, the likely anti-
competitive effects of the merger. The Court noted that in circumstances where the quantita-
tive anti-competitive effects outweigh the quantitative efficiencies, the first step will in most
cases be dispositive, and the section 96 defence will not apply. This case confirms that merg-
ing parties are not required to establish “more than marginal” efficiency gains and poten-
tially “small degrees” of net efficiencies are sufficient for section 96 to apply.
In assessing claimed efficiencies, the Competition Tribunal in the CCS (Tervita) case applied
five screens to eliminate efficiencies that are not cognisable under the section:
• Eliminating claims that do not involve a type of productive or dynamic efficiency, or
that are not otherwise likely to result in any increase in allocative efficiency.
• Narrowing the claimed efficiencies to those that are likely to be brought about by the
transaction.
• Filtering out claimed efficiency gains that would be brought about by reason only of a
redistribution of income between two or more persons.
• Filtering out claimed efficiency gains that would be achieved outside Canada and
would not flow back to shareholders in Canada as well as any savings from operations
in Canada that would flow through to foreign shareholders.
• Filtering out claimed efficiencies that either (a) would likely be attained through alter-
native means if the Competition Tribunal were to make the order that it determines
would be necessary to ensure that the merger in question does not prevent or lessen
competition substantially, or (b) would likely be attained through the transaction even
if that order were made.
The Bureau has stated that merging parties should explain how claimed efficiencies pass the
five screens by providing supporting evidence. See: draft A practical guide to efficiencies
analysis in merger reviews (Ottawa: Competition Bureau, March 2018).
Although the Competition Act contemplates the use of section 96 as defence in the context of
merger litigation, in practice the Competition Bureau often performs the trade-off analysis as
part of its merger reviews. Thus, the Bureau has declined to challenge a number of transac-
tions after having concluded that the efficiency gains resulting from the transactions were
likely to outweigh the likely anticompetitive effects. See for example: Competition Bureau,
Position Statement, “Competition Bureau statement regarding Superior’s proposed acquisi-
tion of Canexus” (28 June 2016); Competition Bureau, Press Release, “Acquisition of
Canexus by Chemtrade will not be challenged” (8 March 2017) and Competition Bureau,
Position Statement, “Competition Bureau statement regarding Canadian National Railway
Company’s proposed acquisition of H&R Transport Limited” (22 April 2020). In the Chem-
trade/Canexus merger transaction, the Bureau “determined that the proposed transaction
would likely result in anti-competitive effects because, among other things, it would elimi-
275
nate a competitor in a market with limited remaining competition. However, following a

thorough assessment of the expected efficiencies gained from the transaction including sav-
ings related to transportation costs, the Bureau found that they would significantly outweigh
the likely anti-competitive effects of the transaction.” The Canadian National Railway/H&R
Transport transaction was a non-notifiable merger in which the Bureau used a timing agree-
ment. The Bureau concluded that efficiency gains in the elimination of overhead costs and
duplicative facilities/IT systems would outweigh any anti-competitive effects.
In its assessment of the Superior/Canwest merger transaction, the combination of two pro-
pane retailers, the Bureau carried out the trade-off analysis in every local geographic market
where a substantial lessening of competition was found to be likely. This “market-by-mar-
ket” trade off analysis has been criticised for being “inconsistent with the statutory language
and governing jurisprudence.” See Competition Bureau, Position Statement, “Competition
Bureau statement regarding Superior Plus LP’s proposed acquisition of Canwest Propane
from Gibson Energy ULC” (28 September 2017) and the Letter from the National Competi-
tion Law Section to the Interim Commissioner of Competition Regarding A practical guide
to efficiencies analysis in merger reviews (3 May 2018). In accordance with the fourth
screen above, the Bureau has stated that it “will exclude efficiency gains that are achieved
outside Canada . . . [and that] savings related to operations in Canada that ultimately benefit
foreign shareholders will not be accepted.” See: draft A practical guide to efficiencies analy-
sis in merger reviews (Ottawa: Competition Bureau, March 2018) and the Letter from the
National Competition Law Section to the Interim Commissioner of Competition Regarding A
practical guide to efficiencies analysis in merger reviews (3 May 2018). See also Cutter
(Canada) Ltd. v. Baxter Travenol Laboratories of Canada Ltd. (1984), 1 C.P.R. (3d) 289
(Fed. C.A.); leave to appeal refused (1984), 57 N.R. 159 (S.C.C.), where this issue was
addressed in obiter dicta.
In accordance with the fourth screen above, the Bureau has stated that it “will exclude effi-
ciency gains that are achieved outside Canada . . . [and that] savings related to operations in
Canada that ultimately benefit foreign shareholders will not be accepted.” See: draft A prac-
tical guide to efficiencies analysis in merger reviews (Ottawa: Competition Bureau, March
2018) and the Letter from the National Competition Law Section to the Interim Commis-
sioner of Competition Regarding A practical guide to efficiencies analysis in merger reviews
(3 May 2018). See also Canada (Director of Investigation & Research) v. Hillsdown
Holdings (Canada) Ltd. (1992), 1 C.P.R. (3d) 289 (Competition Trib.), where this issue was
addressed in obiter dicta.
Dissatisfaction with the current balancing weights approach led at one time to various reform
proposals. That debate subsided somewhat following statements by the Commissioner that
the Bureau’s preferred approach was to work with the existing case law, assess efficiencies
on a case-by-case basis and not seek legislative amendment. See, for example, Speaking
Notes for Sheridan Scott, Commissioner of Competition, Competition Bureau, Canadian Bar
Association Annual Fall Conference on Competition Law, Hilton Lac-Leamy, Gatineau (28
September 2006). That has been changing, with subsequent Commissioners repeatedly ex-
pressing dissatisfaction with section 96. For example, in 2012, then Commissioner Aitken
said that “while the goal [of the efficiencies defence] is unquestionably laudable, [it] may in
the way it is currently embodied in the Act, allow for the most monopolistic and harmful of
mergers to go through.” See Remarks by Melanie L. Aitken, Commissioner of Competition,
Competition Bureau, Canadian Bar Association, Ottawa (20 September 2012). In 2016 Com-
missioner Pecman also expressed dissatisfaction with section 96: “Canada’s approach to effi-
ciencies is increasingly misaligned with other jurisdictions [and] that [is] bad for businesses
and bad for consumers.” See “Strengthening competition: Innovation, collaboration and
276
transparency,” Remarks by John Pecman, Commissioner of Competition, Canadian Bar As-

sociation’s Competition Law Fall Conference, Ottawa, Ontario (6 October 2016). In 2019,
Commissioner Boswell took this a step further and stated “I am highly unlikely to exercise
my enforcement discretion and not challenge a potentially anti-competitive merger without
reliable, credible, and probative evidence that supports and validates the efficiencies defence
being advanced. Our refined procedural approach, in these types of cases, will call for: the
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provision of detailed evidence supporting the efficiencies claimed; the ability to test the evi-
dence underlying those claims; and adequate time, set out in a timing agreement, to conduct
a meaningful assessment of the efficiencies claimed.” See “No River too Wide, No Moun-
tain too High: Enforcing and Promoting Competition in the Digital Age,” Remarks by Mat-
thew Boswell, Commissioner of Competition, Canadian Bar Association’s Competition Law
Spring Conference, Toronto, Ontario (7 May 2019).
Efficiencies are also referred to in sections 1.1, 82, 86 and 90.1 of the Act.
The treatment of efficiencies under section 96 has, as noted, been the subject of extensive
litigation and scholarly debate. The leading cases, summarised above, are Superior Propane
and CCS (Tervita). The primary sources of guidance from the Competition Bureau are its
Merger Enforcement Guidelines (Ottawa: Competition Bureau, October 2011) and its draft A
practical guide to efficiencies analysis in merger reviews (Ottawa: Competition Bureau,
March 2018). For a commentary on that draft guide, see the Letter from the National Compe-
tition Law Section to the Interim Commissioner of Competition Regarding A practical guide
to efficiencies analysis in merger reviews (3 May 2018). Scholarly commentary includes:
John F Clifford, Mark Opashinov and Michael Hollinger, “Efficiency-dependent mergers:
lessons from Canada,” 6 Global Competition Review 5 (May 2003); Report of the Advisory
Panel on Efficiencies, Submitted to Sheridan Scott, Commissioner of Competition (August
2005); Brian Facey and Joshua Krane, “Promoting Innovation and Efficiency by Streamlin-
ing Competition Reviews,” (2 March 2017) CD Howe Institute E-Brief; Joshua Krane, Cas-
sandra Brown and Jim Robson, “Marshalling the Efficiencies Defence,” (2016) 74 SCLR
(2d); Matthew Chiasson and Paul A Johnson, “Canada’s (In)efficiency Defence: Why Sec-
tion 96 May Do More Harm Than Good for Economic Efficiency and Innovation,” (2019)
32 CCLR 1; Brian Facey and David Dueck, “Canada’s Efficiency Defence: Why Ignoring
Section 96 Does More Harm Than Good for Economic Efficiency and Innovation” (2019) 32
CCLR 33.
Case Law
Commissioner of Competition v. CCS Corp., 2015 SCC 3 (S.C.C.) — The “reasonably ob-
jective” approach to s. 96 outlined by the Court is a two-pronged inquiry. First, the quantita-
tive merger efficiencies should be compared against the quantitative anti-competitive effects.
Where the quantitative anti-competitive effects outweigh the quantitative efficiencies, in
most cases this step will be dispositive and the defence will not apply. Second, the qualita-
tive efficiencies should be balanced against the qualitative anti-competitive effects, and a
final determination should then be made whether the total efficiencies offset the total anti-
competitive effects. Effects that can be quantified should be quantified, even as estimates. If
effects are realistically measurable, failure to at least estimate the quantum of those effects
will not result in the effects being assessed on a qualitative basis but in those effects being
attributed no value. The efficiencies defence can succeed even where only marginal effi-
ciency gains have been proven.
Canada (Commissioner of Competition) v. Superior Propane Inc., 2003 FCA 53 (Fed.
C.A.) — The Commissioner again appealed the Tribunal’s decision allowing the merger, and
submitted that the entire wealth transfer should be added to the deadweight loss calculated
277
by the Tribunal, in accordance with the “consumer surplus” standard. In dismissing the ap-
peal, the appellate court held that the Tribunal had prima facie followed its earlier directions
as the Tribunal had not restricted itself to the total surplus standard. If a monopoly was to be
taken into account for the purposes of s. 96(1), it is the effects of the monopoly that must be
considered and not the existence of the monopoly per se. The Tribunal had already taken
into account a number of the effects of the merger. The Tribunal was within the discretion
conferred by the earlier court ruling when it engaged in the “socially adverse effects” ap-
proach. There was evidence to support the Tribunal’s rejection of the Commissioner’s
favoured consumer surplus standard, and the Tribunal did not make an err in law in not
including the entire wealth transfer in assessing anti- competitive effects. Although the so-
cially adverse effects approach might place a greater burden on the Commissioner than
would have other approaches, there was no evidence to suggest that the burden was impossi-
ble to meet.
Canada (Commissioner of Competition) v. Superior Propane Inc. (2002), 18 C.P.R. (4th)
417 (Competition Trib.); affirmed (2003), 23 C.P.R. (4th) 316 (Fed. C.A.) — The Competi-
tion Tribunal conducted a redetermination proceeding with respect to the merger of Superior
Propane Inc. and ICG Propane Inc. following the Federal Court of Appeal decision at 11
C.P.R. (4th) 289. The Federal Court of Appeal held that the Tribunal had erred in concluding
that the merger was saved by the efficiency defence provided in s. 96 of the Act. On the
redetermination, the Commissioner’s application to dissolve the merger was dismissed. Ap-
plying the balancing weights approach proposed by the Commissioner’s expert would re-
quire a public interest determination which was outside of the mandate of the Tribunal. In its
initial decision, the Tribunal had concluded that efficiency was the paramount objective of
the merger provisions of the Act. The appellate court had stated that the Tribunal was correct
but had instructed the Tribunal to consider redistributive effects. However, there was insuffi-
cient evidence to evaluate the redistributive effects. There was no evidence of anti-competi-
tive conduct affecting small or medium-sized enterprises or the elimination of smaller com-
petitors. The Tribunal applied a “balancing weights” approach involving a two-stage
process. The first stage involved a decision whether (a) to determine the relative weights to
be assigned to producer gains and consumer losses, (b) to equate them, or (c) to make the
wealth transfer neutral in effect. The second stage was to engage in a value-judgment pro-
cess to decide whether the assigned weights were reasonable in light of societal interests.
The Tribunal calculated the wealth transfer from consumers to the shareholders of the
merged entity at about $40.5 million per annum, but was not prepared to assume that the
entirety of this transfer should necessarily be considered a socially adverse effect of the
merger. The Tribunal calculated the socially adverse portion of the wealth transfer to be
about $2.6 million per annum. The tests of “greater than” and “offset” in s. 96 required a
comparison of the aggregate gains in efficiency with the aggregate effects of lessening or
prevention of competition across all markets and areas. The gains in efficiency were greater
than and off-setting of adverse redistributive effects based on the evidence under any reason-
able weighting system.
CarswellNat 1906 (S.C.C.) — The Competition Tribunal dismissed the Commissioner’s ap-
plication for an order dissolving the merger of two companies which marketed propane and
related appliances and services. The Tribunal was unanimous in finding that the merger
would substantially lessen or prevent competition in nearly all local propane markets, and
that divestiture was the only appropriate remedy to prevent this result. By a majority, how-
ever, the Tribunal concluded that the merger was saved by the efficiency defence provided in
278
s. 96 of the Competition Act. In rendering its decision, the tribunal used the total surplus
standard under which the dead weight loss was the sole effect of the lessening of competition
that should be balanced against any quantitative efficiency gains. The Commissioner ap-
pealed, and the appeal was allowed with the matter remitted to the Tribunal for redetermina-
tion. The Tribunal erred when it interpreted s. 96 as mandating that, in all cases, the only
effects of an anti-competitive merger that may be balanced against the efficiencies created
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by the merger were those identified by the total surplus standard. The word “effects” in s. 96
should be interpreted to include all anti-competitive effects to which a merger in fact gave
rise, having regard to all of the statutory purposes set out in s. 1.1 of the Act. As Parliament
failed to state that only dead weight loss should be considered as an effect, it was reasonable
to infer that other effects must be taken into account in making the trade- off between effi-
ciencies and anti-competitive effects. Moreover, the Tribunal ignored as an effect of the
merger, the fact that monopolies would ensue in certain product markets and erred in failing
to give any weight to that effect in its analysis.
(3d) 573 (Competition Trib.) — The respondents were ordered to provide particulars about
efficiency gains pleaded in their response to the Director’s application respecting a merger.
Where the particulars provided were simply a bald and uninformative statement which did
not materially expand upon information contained in the pleadings, further particulars will
be ordered that contain a meaningful list of the types of efficiency gains claimed.
Canada (Director of Investigation & Research) v. Hillsdown Holdings (Canada) Ltd. (1992),
41 C.P.R. (3d) 289 (Competition Trib.) — In determining whether a merger will bring about
gains in efficiency greater than the effects of a lessening of competition, the Competition
Tribunal is not limited to examining only the effects of the merger on the economy as a
whole. All of the objectives listed in s. 1.1 of the Act may be considered and one is not to be
given priority over others.
97. Limitation period — No application may be made under section 92 in

respect of a merger more than one year after the merger has been substan-
tially completed.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 2009, c. 2, s. 430
98. Where proceedings commenced under section 45, 49, 79 or

90.1 — No application may be made under section 92 against a person on the
basis of facts that are the same or substantially the same as the facts on the
basis of which
45 or 49; or
(b) an order against that person is sought under section 79 or 90.1.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 2009, c. 2, s. 430
Commentary
Section 45 is the offence of conspiracies, agreements or arrangements between competitors;
section 49 is the offence of agreements or arrangements of federal financial institutions; sec-
tion 79 is the reviewable practice of abuse of dominant position; and section 90.1 is the
reviewable practice of agreements or arrangements that prevent or lessen competition
substantially.
279
In practice, a bone fide merger will typically be assessed under the merger provisions of the
Act. Given the broad definition of merger in section 91, it is highly unlikely that any sort of
merger transaction would fall outside the scope of the definition such that the Commissioner
could not assess it under section 92. Moreover, given the substantive and remedial similari-
ties between sections 90.1 and 92, it is unlikely, as a practical matter, that the Commissioner
would chose to assess a merger under section 90.1. However, in Laidlaw, a series of mergers
was considered to be an anti-competitive act and abuse of dominance under section 79. In R.
v. Beton, parties to a sham merger negotiation were prosecuted under the section 45 conspir-
acy provisions.
99. (1) Conditional orders directing dissolution of a merger — The

Tribunal may provide, in an order made under section 92 directing a person
to dissolve a merger or to dispose of assets or shares, that the order may be
rescinded or varied if, within a reasonable period of time specified in the
order,
(a) there has occurred
(i) a reduction, removal or remission, specified in the order, of any
relevant customs duties, or
(ii) a reduction or removal, specified in the order, of prohibitions,
controls or regulations imposed by or pursuant to any Act of Parlia-
ment on the importation into Canada of an article specified in the
order, or
(b) that person or any other person has taken any action specified in the
order
that will, in the opinion of the Tribunal, prevent the merger from preventing
or lessening competition substantially.
(2) When conditional order may be rescinded or varied — Where,
on application by any person against whom an order under section 92 is di-
rected, the Tribunal is satisfied that
(a) a reduction, removal or remission specified in the order pursuant to
paragraph (1)(a) has occurred, or
(b) the action specified in the order pursuant to paragraph (1)(b) has been
taken,
the Tribunal may rescind or vary the order accordingly.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
Commentary
Subsection (1)
An order under this subsection may be characterized as one subject to a condition subse-
quent. The conditions in para. (a) are outside the control of either the Tribunal or the parties
affected by the order.
Such an order would not be of much avail to parties proposing a merger unless governmental
action of the type referred to was seen as pending or imminent.
280
Paragraph (b) refers to orders where the condition is dependent on a party to the merger or
some other person. Such a condition might be the cessation of conduct perceived as anti-
competitive. For example the Tribunal could prohibit a merger unless the parties thereto
ceased the practice of selling only on a “delivered price” basis. The Tribunal might be of the
opinion that the merger would significantly increase oligopolistic interdependence. Oligo-
polistic interdependence can be facilitated by basing point pricing systems. See the commen-
Act
tary to s. 80. It might be that the Tribunal was of the opinion that any anti-competitive ef-
fects of the merger would be sufficiently mitigated by the cessation of delivered pricing.
Subsection (2)
This subsection simply established that the burden of proving the occurrence of the condi-
tions specified in the conditional order is on the party against whom the order was directed.
100. (1) Interim order where no application under section 92 — The

Tribunal may issue an interim order forbidding any person named in the ap-
plication from doing any act or thing that it appears to the Tribunal may con-
stitute or be directed toward the completion or implementation of a proposed
merger in respect of which an application has not been made under section 92
or previously under this section, where
(a) on application by the Commissioner, certifying that an inquiry is be-
ing made under paragraph 10(1)(b) and that, in the Commissioner’s opin-
ion, more time is required to complete the inquiry, the Tribunal finds that
in the absence of an interim order a party to the proposed merger or any
other person is likely to take an action that would substantially impair the
ability of the Tribunal to remedy the effect of the proposed merger on
competition under that section because that action would be difficult to
reverse; or
(b) the Tribunal finds, on application by the Commissioner, that there has
been a contravention of section 114 in respect of the proposed merger.
(2) Notice of application — Subject to subsection (3), at least forty-eight
hours notice of an application for an interim order under subsection (1) shall
be given by or on behalf of the Commissioner to each person against whom the
order is sought.
(3) Ex parte application — Where the Tribunal is satisfied, in respect of an
application for an interim order under paragraph (1)(b), that
(a) subsection (2) cannot reasonably be complied with, or
(b) the urgency of the situation is such that service of notice in accordance
with subsection (2) would not be in the public interest,
it may proceed with the application ex parte.
(4) Terms of interim order — An interim order issued under subsection
(1)
(a) shall be on such terms as the Tribunal considers necessary and suffi-
cient to meet the circumstances of the case; and
281
(b) subject to subsections (5) and (6), shall have effect for such period of
time as is specified in it.
(5) Duration of order: inquiry — The duration of an interim order issued
under paragraph (1)(a) shall not exceed thirty days.
(6) Duration of order: failure to comply — The duration of an interim
order issued under paragraph (1)(b) shall not exceed
(a) ten days after section 114 is complied with, in the case of an interim
order issued on ex parte application; or
(b) thirty days after section 114 is complied with, in any other case.
(7) Extension of time — Where the Tribunal finds, on application made by
the Commissioner on forty-eight hours notice to each person to whom an in-
terim order is directed, that the Commissioner is unable to complete an in-
quiry within the period specified in the order because of circumstances beyond
the control of the Commissioner, the Tribunal may extend the duration of the
order to a day not more than sixty days after the order takes effect.
(8) Completion of inquiry — Where an interim order is issued under par-
agraph (1)(a), the Commissioner shall proceed as expeditiously as possible to
complete the inquiry under section 10 in respect of the proposed merger.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, ss. 24, 37(z.9)
Commentary
Sections 100 and 104 of the Act empower the Commissioner of Competition to apply to the
Competition Tribunal for interim orders to prevent the completion or implementation of a
proposed merger.
Where no application has been made under section 92, section 100 orders may be made by
the Tribunal. Under subsection 100(1), the Tribunal may issue an interim order forbidding
the completion or implementation of a proposed merger (a) where the Tribunal finds that, in
absence of an interim order, an action is likely to be taken that will substantially impair the
ability of the Tribunal to remedy the effect of the proposed merger on competition; or (b)
where the Tribunal finds that section 114 of the Act has been contravened. Pursuant to sec-
tion 104 of the Act, where an application has been made under section 92, the Tribunal may
issue any interim order which it considers appropriate.
Section 100 allows the Commissioner of Competition to apply the Competition Tribunal for
an interim order forbidding any person named in the application from doing any act or thing
directed toward the completion or implementation of the proposed merger.
The section requires that:
• The Commissioner must certify that an inquiry under paragraph 10(1)(b) has been
commenced;
• The Commissioner must be of the opinion that more time is required to complete the
inquiry; and
• The Tribunal must be satisfied that likely action would substantially impair its ability
to impose a remedy because that action would be difficult to reverse.
282
Among other relief, the Tribunal may forbid the closing of a merger for a limited period of
time (30 days subject to an extension of up to an additional 30 days pursuant to subsection
100(7)).
See generally Antonio Di Domenico, Competition Enforcement and Litigation in Canada
(Toronto: Emond Montgomery Publications Limited, 2019) at page 575.
Act
Case Law
Commissioner of Competition v. American Iron & Metal Company Inc. (2008), CT-2008-
001 (Competition Trib.) — American Iron & Metal Company informed the Commissioner
that it would complete its proposed acquisition of S N F Inc. following expiry of the 42-day
waiting period under s. 123. The Commissioner applied for an interim order pursuant to s.
100 on January 29, 2008 forbidding American Iron from completing or taking steps toward
completing the proposed acquisition. On February 6, 2008, the Commissioner and the parties
to the proposed acquisition signed a consent agreement pursuant to which American Iron
agreed to a hold separate arrangement to preserve the assets of S N F Inc. for a period of 60
days following the closing of the transaction in order to enable the Commissioner to com-
plete her inquiry.
Canada (Commissioner of Competition) v. Labatt Brewing Co., 2007 Comp. Trib. 9 (Com-
petition Trib.); affirmed 2008 FCA 22 (F.C.A.) — Labatt had signed an agreement to acquire
Lakeport Brewing, a discount beer maker, and proposed to complete the transaction upon
expiry of the 42-day waiting period under s. 123. The Commissioner sought an interim order
from the Tribunal pursuant to s. 100, requesting a 30-day delay in the closing of a merger
transaction because she had not yet completed her review. Three requirements must be met
before the Tribunal may make an interim order under s. 100: (i) the Commissioner must
certify that an inquiry is being made into a proposed transaction under para. 10(1)(b); (ii) the
Commissioner must be of the opinion that more time is required to complete the inquiry; and
(iii) the Tribunal must be satisfied that if the order is not granted, an action is likely to be
taken that would substantially impair the Tribunal’s ability to remedy the proposed merger
on competition because that action would be difficult to reverse. The Commissioner submit-
ted that the last criterion requires a determination of whether the action contemplated by the
parties would be difficult to reverse and thus substantially impair the ability of the Tribunal
to remedy the negative effect of the merger on competition. The Commissioner submitted
that because the closing of the transaction would be difficult to reverse, the Tribunal would
be substantially impaired. The Commissioner’s application was dismissed. The Tribunal
concluded that its ability to remedy the effects of the merger was not substantially impaired
as it had other available measures to remedy a potential lessening of competition. The Tribu-
nal’s decision was upheld on appeal. The Court of Appeal found that the Commissioner’s
application for an interim order was deficient because it failed to establish that, without an
interim order, the Tribunal’s remedial powers under s. 92 would be substantially impaired.
Canada (Director of Investigation & Research) v. Superior Propane Inc. (1998), 85 C.P.R.
(3d) 192 (Competition Trib.). In an application under s. 100 to enjoin a merger, the Director
sought to introduce excerpts of the examination taken under oath pursuant to s. 11. The
introduction of the transcript excerpts into evidence was refused as the s. 11 testimony was
not referred to in the affidavit supporting the application. The Tribunal was confined to the
affidavit evidence submitted by the Director and by the respondents.
Canada (Director of Investigation & Research) v. Superior Propane Inc. (1998), 85 C.P.R.
(3d) 194 (Competition Trib.) — The Director brought an application for an interim order
under s. 100 seeking to enjoin the proposed merger. Section 100 is utilized prior to making
283
an application under s. 92, and after proceedings are commenced under s. 92, a further appli-
cation is made under s. 104. The application under s. 100 was dismissed. The principles
ordinarily considered when granting injunctive relief were found not to be applicable. The
Tribunal must determine whether the proposed merger was reasonably likely to prevent or
lessen competition substantially and whether, without an interim order, an action will be
taken that will substantially impair the ability of the Tribunal to remedy the effect of the
proposed merger under s. 92. This higher standard was less than s. 92 but higher than s. 104.
In this instance, the Director failed to provide evidence to establish that the merger was
reasonably likely to prevent or lessen competition substantially by solely relying on evidence
of concentration or market share. There was evidence of the substitutability of other compet-
ing gases to that of propane.
101. Right of intervention — The attorney general of a province may in-

tervene in any proceedings before the Tribunal under section 92 for the pur-
pose of making representations on behalf of the province.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
Commentary
A provincial government may, of course, make representations either for or against allowing
the merger. In instances where a provincial government has made its own investigation or
inquiry, such representations may provide invaluable information not otherwise available to
the Tribunal.
102. (1) Advance ruling certificates — Where the Commissioner is satis-

fied by a party or parties to a proposed transaction that he would not have
sufficient grounds on which to apply to the Tribunal under section 92, the
Commissioner may issue a certificate to the effect that he is so satisfied.
(2) Duty of Commissioner — The Commissioner shall consider any re-
quest for a certificate under this section as expeditiously as possible.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.10)
Commentary
As an alternative to a pre-merger notification filing, parties to a notifiable transaction may
apply for an advance ruling certificate (ARC), which may be issued when the Commissioner
of Competition is satisfied that he/she would not have sufficient grounds on which to chal-
lenge a proposed merger transaction before the Tribunal. The issuance of an ARC is discre-
tionary and ARCs are typically issued only to parties involved in non-complex transactions
that do not raise any significant competition law issues. If granted, an ARC exempts the
parties from the notification requirements under the Act and bars the Commissioner from
bringing an application under section 92 of the Act. (See also the commentary under section
103.) If an ARC is not granted, the Commissioner may, under paragraph 113(c) of the Act,
nevertheless waive the pre-merger notification requirement and issue a “no action” letter
confirming that she has no present intention to bring an application under section 92. (See
also the commentary under paragraph 113(c).) For that reason, parties requesting ARCs usu-
ally also request in the alternative that filing obligations under paragraph 113(c) be waived
and a “no action” letter be issued.
284
The ARC process is extremely flexible, particularly since there are no formal requirements
regarding the information to be supplied in an ARC application (although the Competition
Bureau Fees and Service Standards Handbook for Mergers and Merger-Related Matters
outlines the type of information the Competition Bureau typically expects to receive in order
to be able to process an ARC application). For the most part, the information supplied de-
pends upon the issues to which a proposed transaction gives rise and counsel’s assessment of
Act
those issues. ARC applications typically take the form of a letter to the Competition Bureau
describing the proposed transaction, the businesses of the parties and the competitive impact
of the proposed transaction. The competitive impact description usually includes an assess-
ment of the product and geographic markets in which the parties compete and an analysis of
the relevant factors set out in section 93 of the Act to be considered when determining
whether a proposed transaction is likely to prevent or lessen competition substantially in a
relevant market. Where there are clearly no business overlaps between the acquiror and tar-
get, ARC applications can be very short and straightforward. They certainly compare
favourably with requirements in other countries that may require detailed merger filings with
detailed information about the parties’ operations, even where there are clearly no issues.
See also Procedures Guide for Notifiable Transactions and Advance Ruling Certificates
under the Competition Act (Ottawa: Competition Bureau, 2010).
103. No application under section 92 — Where the Commissioner issues

a certificate under section 102, the Commissioner shall not, if the transaction
to which the certificate relates is substantially completed within one year after
the certificate is issued, apply to the Tribunal under section 92 in respect of the
transaction solely on the basis of information that is the same or substantially
the same as the information on the basis of which the certificate was issued.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.11)
Commentary
Section 103 prevents the Commissioner of Competition from applying to the Competition
Tribunal for a remedial order under section 92 where an Advance Ruling Certificate (ARC)
has been issued. The section and ARC application process more generally have a number of
important features.
First, an ARC will only insulate merger parties from challenge if the proposed transaction is
substantially completed within one year after the ARC was issued. After one year, paragraph
113(b) may operate to exclude the requirement for a new ARC application or pre-merger
notification, but s. 103 would no longer bar the Commissioner from lodging an application.
See generally the Competition Bureau’s Pre-Merger Notification Interpretation Guideline
Number 8: “Substantially Completed” and “Completed” (sections 103 and 119 of the Act)
for guidance as to the meaning of the phrase “substantially completed” as it is used in section
103.
Second, section 103 only prevents the Commissioner from challenging a merger “solely on
the basis of information that is the same or substantially the same as the information on the
basis of which the certificate was issued.” If circumstances change or new information
comes to light, the Commissioner is therefore free to seek an order from the Competition
Tribunal. This restriction should and does act as an incentive for merger parties to fully
disclose all information relevant to Competition Bureau’s competitive impact assessment of
a merger in respect of which an ARC is requested. Although the Bureau has never chal-
lenged a merger following the issuance of an ARC, it has, following the receipt of new
285
information, re-opened files to consider whether new information would have affected its
competitive impact assessment and decision to issue an ARC.
Third, an ARC application is a request for an exemption from a pre-merger notification fil-
ing obligation, but does not constitute notification for the purposes of Part IX of the Act.
Thus, an application for an ARC will not trigger the commencement of the statutory waiting
periods under section 123 of the Act. Although the Bureau normally completes its review of
ARC applications very quickly (in non-complex cases, a two-week turnaround time is stan-
dard), if certainty about regulatory timing is important, it may be prudent to make a pre-
merger notification filing. It is not uncommon to request an ARC and to make a pre-merger
notification filing at the same time.
The Competition Bureau Fees and Service Standards Handbook for Mergers and Merger-
Related Matters (Ottawa: Competition Bureau, 2010) sets out the information the Bureau
generally expects to receive in connection with ARC applications (and merger notification
filings) in order to be able to complete its competitive impact assessment.
General
103.1 (1) Leave to make application under section 75, 76 or 77 —
Any person may apply to the Tribunal for leave to make an application under
section 75, 76 or 77. The application for leave must be accompanied by an
affidavit setting out the facts in support of the person’s application under that
section.
(2) Notice — The applicant must serve a copy of the application for leave on
the Commissioner and any person against whom the order under section 75,
76 or 77, as the case may be, is sought.
(3) Certification by Commissioner — The Commissioner shall, within
48 hours after receiving a copy of an application for leave, certify to the Tribu-
nal whether or not the matter in respect of which leave is sought
(a) is the subject of an inquiry by the Commissioner; or
(b) was the subject of an inquiry that has been discontinued because of a
settlement between the Commissioner and the person against whom the
order under section 75, 76 or 77, as the case may be, is sought.
(4) Application discontinued — The Tribunal shall not consider an appli-
cation for leave respecting a matter described in paragraph (3)(a) or (b) or a
matter that is the subject of an application already submitted to the Tribunal
by the Commissioner under section 75, 76 or 77.
(5) Notice by Tribunal — The Tribunal shall as soon as practicable after
receiving the Commissioner’s certification under subsection (3) notify the ap-
plicant and any person against whom the order is sought as to whether it can
hear the application for leave.
(6) Representations — A person served with an application for leave may,
within 15 days after receiving notice under subsection (5), make representa-
286
tions in writing to the Tribunal and shall serve a copy of the representations
on any other person referred to in subsection (2).
(7) Granting leave to make application under section 75 or 77 —
The Tribunal may grant leave to make an application under section 75 or 77 if
it has reason to believe that the applicant is directly and substantially affected
Act
in the applicant’s business by any practice referred to in one of those sections
that could be subject to an order under that section.
(7.1) Granting leave to make application under section 76 — The
Tribunal may grant leave to make an application under section 76 if it has
reason to believe that the applicant is directly affected by any conduct referred
to in that section that could be subject to an order under that section.
(8) Time and conditions for making application — The Tribunal may
set the time within which and the conditions subject to which an application
under section 75, 76 or 77 must be made. The application must be made no
more than one year after the practice or conduct that is the subject of the
application has ceased.
(9) Decision — The Tribunal must give written reasons for its decision to
grant or refuse leave and send copies to the applicant, the Commissioner and
any other person referred to in subsection (2).
(10) Limitation — The Commissioner may not make an application for an
order under section 75, 76, 77 or 79 on the basis of the same or substantially
the same facts as are alleged in a matter for which the Tribunal has granted
leave under subsection (7) or (7.1), if the person granted leave has already
applied to the Tribunal under section 75, 76 or 77.
(11) Inferences — In considering an application for leave, the Tribunal may
not draw any inference from the fact that the Commissioner has or has not
taken any action in respect of the matter raised by it.
(12) Inquiry by Commissioner — If the Commissioner has certified under
subsection (3) that a matter in respect of which leave was sought by a person is
under inquiry and the Commissioner subsequently discontinues the inquiry
other than by way of settlement, the Commissioner shall, as soon as practica-
ble, notify that person that the inquiry is discontinued.
2002, c. 16, s. 12; 2009, c. 2, s. 431
Commentary
Private individuals and corporations are able to bring applications directly to the Competi-
tion Tribunal in relation to refusal to deal (s. 75), price maintenance (s. 76) and exclusive
dealing, tied selling, and market restriction (s. 77). The Federal Court of Appeal held in
Symbol Technologies ULC v. Barcode Systems Inc. that the test for leave is whether an appli-
cant has provided sufficient credible evidence to give rise to a bona fide belief that it may
287
have been directly and substantially affected in its business. The following safeguards con-
trol the use of private access and prevent frivolous or groundless proceedings:
• a prospective applicant will be required, as a first step, to obtain leave of the Tribunal
in order to bring an application (subs. 103.1(1));
• in granting leave for applications under sections 75 and 77, the Tribunal must believe
that the applicant’s business is directly and substantially affected by the relevant anti-
competitive practice. The Tribunal has consistently taken the position that a substantial
effect on a business is measured in the context of the entire business. A substantial
effect is one that is “important” or “significant.” (subs. 103.1(7));
• in granting leave for applications under section 76, the Tribunal must believe that the
applicant is directly affected by the relevant anti-competitive conduct (subs
103.1(7.1)); and
• leave will not be granted if the Commissioner has commenced an inquiry or settled a
matter (subs. 103.1(4)).
In considering an application for leave, the Tribunal may not draw any inference from the
fact that the Commissioner has or has not taken any action in respect of the matter raised by
it (subs. 103.1(11)).
Numerous applications for leave have been made since section 103.1 was added to the Act in
2002. The Tribunal has denied leave in most cases. In most instances, applicants have failed
to establish that the conduct had a substantial effect on the applicant’s business. Of the cases
for which leave was granted, all applications on the merits were resolved by way of settle-
ment or dismissed: Barcode Systems Inc. v. Symbol Technologies Canada ULC, 2004 Comp.
Trib. 1 (dismissed); Allan Morgan & Sons Ltd. v. La-Z-Boy Canada Ltd., 2004 Comp. Trib.
4 (settled); Quinlan’s of Huntsville Inc. v. Fred Deeley Imports Ltd., 2004 Comp. Trib. 20
(settled); Robinson Motorcycle Ltd. v. Fred Deeley Imports Ltd., 2005 Comp. Trib. 40 (set-
tled); B-Filer Inc. v. Bank of, 2005 Comp. Trib. 31 (dismissed); Nadeau Ferme Avicole Ltée
/ Nadeau Poultry Farm Ltd. v. Groupe Westco Inc., 2009 Comp. Trib. 6 (dismissed); Used
Car Dealers Assn. of Ontario v. Insurance Bureau of Canada, 2011 Trib. conc. 10 (settled);
and Stargrove Entertainment Inc. v. Universal Music Publishing Group Canada, 2015
Comp. Trib. 26 (settled).
Case Law
CarGurus, Inc. v. Trader Corporation, 2016 Comp. Trib. 15 (Competition Trib.); affirmed
2017 CarswellNat 4278 (F.C.A.) — The applicant applied pursuant to s. 103.1 for leave to
make applications under s. 75, s. 76, and s. 77 against Trader Corporation. The application
was dismissed. CarGurus had sought an order directing Trader to accept CarGurus as a cus-
tomer, to supply certain vehicle listings data to it on standard trade terms, and prohibiting
Trader from continuing to engage in the practices which formed the basis of CarGurus’ ap-
plication. The Tribunal found with respect to s. 75 and s. 77 that there was not sufficient
credible evidence to give rise to a bona fide belief that CarGurus may have been or was
substantially affected in its business by the alleged refusal to supply or exclusive dealing by
Trader. The Tribunal found a number of deficiencies with respect to CarGurus’ evidence of
substantial effect, including the fact that the evidence did not clearly indicate to the Tribunal
the proportion of supply represented by Trader in CarGurus’ business or in the upstream
market as a whole. The Tribunal questioned CarGurus’ evidence of substantial effect since
CarGurus was expecting and forecasting its revenues to continuously increase. A baldy as-
serted anticipated decrease in revenue growth, compared to an earlier unsupported projec-
tion, cannot provide the basis for a bona fide belief of an actual or likely substantial effect.
288
With respect to s. 76, the Tribunal concluded that CarGurus had not provided sufficient cred-
ible evidence that: (i) CarGurus had a low pricing policy; (ii) the alleged refusal by Trader to
supply CarGurus with its vehicle listing data was motivated by this low pricing policy; and,
(iii) that there was any likely adverse effect on competition in a relevant market.
Used Car Dealers Assn. of Ontario v. Insurance Bureau of Canada, 2011 Comp. Trib. 10 —
The applicant applied pursuant to subs. 103.1(1) for leave to make applications under s. 75
Act
and s. 76 against the Insurance Bureau of Canada. Leave was granted to make an application
under s. 75 but denied for a s. 76 application. In respect of the subsection 103.1(7) test for
leave to make a s. 75 application, the Tribunal concluded that the termination of the appli-
cant’s access to the respondent’s insurance claims database, which caused the applicant to
suspend its Auto Check vehicle accident history service, directly and substantially affected
the applicant’s business and that the action could be subject to an order under s. 75. The
meaning of “could” in subs. 103.1(7) may be equated to “possible”. Proving that an order
could be granted requires sufficient evidence to give rise to a bona fide belief that an order is
possible; inferences can be drawn and circumstantial evidence may be considered when
coming to this conclusion. With respect to the subsection 103.1(7.1) test for leave to make an
application under the price maintenance provision, the Tribunal held that although the appli-
cant’s business was directly affected by the closure of Auto Check, there was insufficient
credible evidence to establish that the respondent’s decision to terminate access to its
database was due to the applicant’s low pricing policy.
Olah v. Canada (Correctional Service), 2008 Comp. Trib. 29 (Competition Trib.) — The
applicant applied pursuant to subs. 103.1(1) for leave to make an application under s. 77
against Her Majesty the Queen as represented by the Correctional Service of Canada and
Home Hardware. The applicant alleged that the inmate purchasing service, which required
inmates at to purchase merchandise exclusively from Home Hardware, violated s. 77 of the
Act. The application was dismissed. The Tribunal found that the applicant had failed to pro-
vide evidence demonstrating that he was directly and substantially affected in his business
by the service and that the service could be subject to an order under subs. 77(2) of the Act.
The Tribunal also found that the service did not constitute exclusive dealing as defined under
subs. 77(1) of the Act because it was the customer, Correctional Service of Canada, that had
decided to deal exclusively with the supplier, Home Hardware, for the acquisition of in-
mates’ supplies. The applicant was ordered to pay $100 in costs. — See also entry under s.
2.1.
Canadian Standard Travel Agent Registry v. International Air Transport Assn., 2008 Com-
petition Trib. 14, 2008 CarswellNat 2593 (Competition Trib.) — The application was dis-
missed. The Tribunal held that the applicant had failed to adduce evidence that it was di-
rectly and substantially affected in its business by the alleged refusal to deal.
Nadeau Poultry Farm Ltd. v. Groupe Westco Inc., 2008 Comp. Trib. 7, 2008 CarswellNat
2590 (Competition Trib.) — The applicant, a chicken processor in New Brunswick, sought
leave under subs. 103.1(1) to make an application under s. 75 against three of its chicken
suppliers for an order directing them to continue to supply the applicant with live chickens
on usual trade terms in the volumes previously supplied. The respondents had provided ad-
vance notice to the applicant in respect of the termination of supply. The applicant contended
that the refusal to deal would reduce its supply of live chickens by nearly 50% and would
substantially affect its business. The application was granted. The Tribunal found that there
was sufficient evidence on each element of subsection 75(1) to conclude that the applicant
could be directly and substantially effected in its business by the respondent’s refusal to
supply. The Tribunal also held that an applicant may apply for leave prior to a scheduled
289
termination of supply and need not wait until harm actually occurs before making an applica-
tion under subs. 103.1(1).
John Guy Annable v. Capital Sports & Entertainment Inc., 2008 Comp. Trib. 5 (Competition
Trib.) — The applicant applied pursuant to subs. 103.1(1) for leave to make an application
under s. 77 against the owner of a professional hockey team. The applicant alleged that the
respondent had engaged in tied selling by prohibiting him from purchasing tickets to a pri-
mary event unless he also purchased tickets to a secondary event. The application was dis-
missed. The applicant had failed to show that the alleged tied selling had directly and sub-
stantially affected his business. The Tribunal also held that this application was presented
with such disregard for the provisions of the Act that it constituted an abuse of the Tribunal’s
process. The applicant was ordered to pay $300 in costs.
Sears Canada Inc. v. Parfums Christian Dior Canada Inc., 2007 Comp. Trib. 6, 2007 Car-
swellNat 1610 (Competition Trib.) — Sears operated 196 company stores in Canada, selling
Dior fragrance products in 104 stores and Givenchy fragrance products in 121 stores. The
annual revenue from the sale of these products was approximately $16 million. In 2007, after
14 years of supplying these products, both Dior and Givenchy advised Sears that they would
no longer be doing business with Sears. Sears speculated that the refusal to supply was
prompted by the discounts it offered at the end of 2006 on all cosmetic products. Sears
applied under s. 103.1(7) of the Act for leave to commence an application for a supply order
based on the refusal by Dior and Givenchy to supply their fragrances and cosmetics. The
leave application was dismissed. The Tribunal held that a substantial effect on a business is
measured in the context of the entire business. Although Sears would be directly affected by
the refusal to supply, the effect on Sears’ entire business as a department store retailer would
not be substantial. A substantial effect is one that is “important” or “significant.” The Tribu-
nal concluded that the lost revenue was not significant when compared to Sears’ overall sales
of approximately $6 billion.
B-Filer Inc. v. Bank of Nova Scotia (2005), 43 C.P.R. (4th) 37 (Competition Trib.) — The
applicants’ business involved offering customers the ability to use debit cards to pay partici-
pating vendors for the purchase of goods and services over the Internet. The applicants used
three services of the respondent bank in order to process the transactions required to offer
that service, namely e-mail money transfers, Internet banking and bank accounts. The bank
subsequently sent a notice terminating the services, and the Interac network announced that
it would soon start allowing bank customers to pay for on-line purchases with their debit
cards. The applicants applied to the Tribunal pursuant to s. 103.1 of Act for leave to make an
application under s. 75 (refusal to deal) and s. 77 (exclusive dealing) of the Act. The appli-
cants alleged that only two banks, including the respondent bank, offered e-mail money
transfers into business accounts without a charge per deposit in situations where the recipient
was not a bank. The applicants alleged that there were no equivalent suppliers for the respon-
dent bank’s e-mail transfer deposit services as the other bank refused to increase the volume
it processed in the applicants’ accounts. Leave to make an application under s. 75 was
granted, but leave to make an application under s. 77 was denied. The differences between
the applicants’ business, and the services proposed to be offered by Interac were not suffi-
cient to support a finding that they would not operate in the same market. Although there
were 20 fraudulent transfers of funds, there was no evidence of the applicants’ involvement
in any fraud, and they had reimbursed the victims. Even though the vast majority of custom-
ers, who used the applicants’ business, were paying amounts owed to offshore Internet casi-
nos, there were no cases supporting a finding of criminality where Canadians used the In-
ternet to gamble at offshore Internet casinos. There was sufficient credible evidence to give
rise to a bona fide belief that the elements of s. 75 could be satisfied as 50 per cent of the
290
applicants’ revenue was dependent on the banking services provided by the respondent bank.
Since the only other supplier had refused to accept more business from the applicants, there
could be insufficient competition among suppliers. There was no evidence of exclusive deal-
ing as defined by the Competition Act. The Federal Court of Appeal upheld the decision of
the Tribunal.
Robinson Motorcycle Ltd. v. Fred Deeley Imports Ltd. (2005), 44 C.P.R. (4th) 146 (Compe-
Act
tition Trib.) — The exclusive Canadian distributor of particular motorcycles and related
products notified the retailer that its retailer agreement would not be renewed. The retailer
applied to the Tribunal for leave to bring an application under s. 75 of the Act, and the
Tribunal granted leave. The retailer applied for interim relief under s. 104 of the Act, and, on
the consent of the parties, the Tribunal ordered that the distributor supply the retailer with
certain products until the Tribunal decided the merits of the application under s. 75. The
retailer and the distributor reached a settlement agreement on the s. 75 proceedings, provid-
ing for the dismissal of the s. 75 application and a continuation of the interim supply order
for some three months after the date of the settlement. The settlement agreement provided
that the issue of costs be referred to the Tribunal. The Tribunal ordered that each party bear
its own costs. Sections 75 and 103.1 of the Act preclude the Tribunal from drawing any
inference from the fact that the Commissioner of Competition had or had not taken any
action in respect of the matter raised by an application under those provisions. Accordingly,
it would be incongruous for the Tribunal to draw such an inference when allocating costs of
such an application. The Tribunal, when exercising its discretion over the amount and alloca-
tion of costs, may consider the fact that the applicant passed the leave stage. Success in these
proceedings was partially divided.
Construx Engineering Corp. v. General Motors of Canada, 2005 Comp. Trib. 21 (Competi-
tion Trib.) — In a leave application under s. 103.1 of the Act, the threshold is low, but there
must be some evidence presented that would, if the facts were proven, justify an order re-
quiring supply or prohibiting market restriction. The appropriate standard under s. 103.1(7)
is whether the leave application is supported by sufficient credible evidence to give rise to a
bona fide belief that the applicant may have been directly and substantially affected in the
applicant’s business by a reviewable practice, and that the impugned practice could be sub-
ject to an order. In this exercise, the Tribunal must determine whether the applicant was not
only “directly” affected by the respondent’s alleged anticompetitive practice, but had been
substantially affected in its business.
Barcode Systems Inc. v. Symbol Technologies Canada ULC, 2004 Comp. Trib. 1, 29 C.P.R.
(4th) 554 (Competition Trib.); affirmed (2004), 34 C.P.R. (4th) 481 (F.C.A.) — The appli-
cant sought leave pursuant to subs. 103.1(1) to commence an application under s. 75 against
its distributor on the basis that its distributor had refused to supply barcode scanners. The
application for leave was granted. The Tribunal found that the applicant had advanced suffi-
cient credible evidence, supported by an affidavit, to satisfy the Tribunal that there was a
reasonable possibility that its business has been directly and substantially affected by the
respondent’s alleged anti-competitive behaviour. In determining whether to grant leave, the
Tribunal confirmed that it will measure the evidence on a scale that is less than proof on a
balance of probabilities, but more than a mere possibility. The Tribunal’s role on leave appli-
cations is a screening function to determine the sufficiency of the evidence advanced. The
Tribunal also confirmed that it will only grant parties a right of reply in leave applications in
exceptional circumstances which are to be dealt with expeditiously. The Tribunal’s decision
was upheld on appeal. The court affirmed that the correct test for leave is whether an appli-
cant has provided sufficient credible evidence to give rise to a bona fide belief that it may
have been directly and substantially affected in its business. The court concluded that the
291
elements of the alleged anticompetitive conduct must be addressed by the Tribunal on an

application for leave under subs. 103.1(7). While not done in this case, the court held that
there was sufficient evidence to reasonably believe that the respondent’s alleged anticompe-
titive behaviour could be the subject of an order under s. 75(1).
Mrs. O’s Pharmacy v. Pfizer Canada Inc. (2004), 35 C.P.R. (4th) 171 (Competition Trib.) —
The applicant operated a pharmacy near the United States border. The pharmaceutical sup-
plier became aware of a website registered to the applicant, and advised the applicant that it
was not in compliance with the supplier’s terms of trade, which required it to sell or dis-
tribute the supplier’s products only to persons in Canada. When the supplier advised the
applicant that it was no longer approved to purchase the supplier’s product, the applicant
applied under s. 103.1 of the Act for an order under the refusal to deal provisions of the Act.
The leave application was refused. The applicant provided no figures as to the actual loss of
prescription sales due to the supplier’s actions. The affidavit evidence only indicated that the
number of daily prescriptions was not meeting the expectations of its business plan. The
Tribunal must have reason to believe that there existed a causal relationship between the
action of the supplier and the business consequences for the applicant. In this instance, the
causality was speculative.
Allan Morgan & Sons Ltd. v. La-Z-Boy Canada Ltd. (2004), 29 C.P.R. (4th) 559 (Competi-
tion Trib.) — The applicant claimed that it had developed a significant market for the re-
spondent’s furniture products over a period of 25 years. The applicant alleged that the re-
spondent then entered into an exclusive arrangement with a competing retailer, and placed
restrictions on the applicant’s ability to obtain product. The applicant’s sales of the respon-
dent’s product declined over several years, and the respondent terminated its relationship
with the applicant. The applicant applied to the Tribunal for leave to apply for an order under
the refusal to deal provision of the Act. The respondent submitted that it was justified in
terminating its relationship with the applicant, and that there continued to be adequate sup-
plies of comparable product. The application for leave was granted. From the data provided
by the applicant, the Tribunal was satisfied that the applicant may have been directly and
substantially affected by the respondent’s actions. At the leave stage, the applicant was not
required to meet any higher standard of proof.
National Capital News Canada v. Canada (Speaker of the House of Commons) (2002),
[2002] C.C.T.D. No. 38, 23 C.P.R. (4th) 77 (Competition Trib.); affirmed (2004), 29 C.P.R.
(4th) 421 (F.C.A.) — The applicant, an owner of a national newspaper, sought leave pursu-
ant to subs. 103.1(1) to make an application under s. 75 against the Speaker of the House of
Commons because the Speaker had refused the applicant access to the Parliamentary Press
Gallery. The application was denied because the practice complained of could not be subject
to any order of the Tribunal under s. 75. To grant leave to make an application under s. 75,
the Tribunal must have reason to believe that the applicant’s business is directly and substan-
tially affected by the respondent’s alleged practice and that the respondent could be subject
to an order under s. 75. The Tribunal accepted that “reason to believe” in subs. 103.1(7)
requires that there be reasonable grounds to believe the applicant’s allegation. The appropri-
ate standard is whether the leave application is supported by sufficient credible evidence to
give rise to a bona fide belief that the applicant may have been directly and substantially
affected in the applicant’s business by a reviewable practice, and that the practice in question
could be subject to an order. In this case, however, the practice could not be subject to an
order because the parliamentary privilege enjoyed by the House of Commons precluded the
Tribunal from having jurisdiction to hear the matter. The Court of Appeal dismissed the
appeal. The Court of Appeal concluded that the Tribunal did not have the jurisdiction to
292
Part VIII — Reviewable Matters (ss.75-107) S. 103.3(5.1)
make the order sought by the applicant under s. 75 because of Parliament’s privilege to
control access to its precincts and to regulate its internal affairs.
103.2 Intervention by Commissioner — If a person granted leave under

subsection 103.1(7) or (7.1) makes an application under section 75, 76 or 77,
Act
the Commissioner may intervene in the proceedings.
2002, c. 16, s. 12; 2009, c. 2, s. 432
103.3 (1) Interim order — Subject to subsection (2), the Tribunal may, on ex
parte application by the Commissioner in which the Commissioner certifies
that an inquiry is being made under paragraph 10(1)(b), issue an interim
order
(a) to prevent the continuation of conduct that could be the subject of an
order under any of sections 75 to 77, 79, 81, 84 or 90.1; or
(b) to prevent the taking of measures under section 82 or 83.
(2) Limitation — The Tribunal may make the interim order if it finds that
the conduct or measures could be of the type described in paragraph (1)(a) or
(b), and that, in the absence of an interim order,
(a) injury to competition that cannot adequately be remedied by the Tri-
bunal is likely to occur;
(b) a person is likely to be eliminated as a competitor; or
(c) a person is likely to suffer a significant loss of market share, a signifi-
cant loss of revenue or other harm that cannot be adequately remedied by
the Tribunal.
(3) Consultation — Before making an application for an order to prevent
the continuation of conduct that could be the subject of an order under any of
sections 75 to 77, 79, 81, 84 or 90.1 by an entity incorporated under the Bank
Act, the Insurance Companies Act, the Trust and Loan Companies Act or the
Cooperative Credit Associations Act or a subsidiary of such an entity, the Com-
missioner must consult with the Minister of Finance respecting the safety and
soundness of the entity.
(4) Duration — Subject to subsections (5) and (6), an interim order has effect
for 10 days, beginning on the day on which it is made.
(5) Extension or revocation of order — The Tribunal may, on applica-
tion by the Commissioner on 48 hours notice to each person against whom the
interim order is directed,
(a) extend the interim order once or twice for additional periods of 35
days each; or
(b) rescind the order.
(5.1) Application to Tribunal for extension — The Commissioner may,
before the expiry of the second 35 day period referred to in subsection (5) or of
293
S. 103.3(5.1) Competition Act
the period fixed by the Tribunal under subsection (7), as the case may be, ap-
ply to the Tribunal for a further extension of the interim order.
(5.2) Notice of application by Commissioner — The Commissioner
shall give at least 48 hours notice of an application referred to in subsection
(5.1) to the person against whom the interim order is made.
(5.3) Extension of interim order — The Tribunal may order that the ef-
fective period of the interim order be extended if
(a) the Commissioner establishes that information requested for the pur-
pose of the inquiry has not yet been provided or that more time is needed
in order to review the information;
(b) the information was requested during the initial period that the in-
terim order had effect, within the first 35 days after an order extending
the interim order under subsection (5) had effect, or within the first 35
days after an order extending the interim order made under subsection
(7) had effect, as the case may be, and
(i) the provision of such information is the subject of a written under-
taking, or
(ii) the information was ordered to be provided under section 11; and
(c) the information is reasonably required to determine whether grounds
exist for the Commissioner to make an application under any section re-
ferred to in paragraph (1)(a) or (b).
(5.4) Terms — An order extending an interim order issued under subsection
(5.3) shall have effect for such period as the Tribunal considers necessary to
give the Commissioner a reasonable opportunity to receive and review the in-
formation referred to in that subsection.
(5.5) Effect of application — If an application is made under subsection
(5.1), the interim order has effect until the Tribunal makes a decision whether
to grant an extension under subsection (5.3).
(6) When application made to Tribunal — If an application is made
under subsection (7), an interim order has effect until the Tribunal makes an
order under that subsection.
(7) Confirming or setting aside interim order — A person against
whom the Tribunal has made an interim order may apply to the Tribunal in
the first 10 days during which the order has effect to have it varied or set aside
and the Tribunal shall
(a) if it is satisfied that one or more of the situations set out in paragraphs
(2)(a) to (c) existed or are likely to exist, make an order confirming the
interim order, with or without variation as the Tribunal considers neces-
sary and sufficient to meet the circumstances, and fix the effective period
of that order for a maximum of 70 days, beginning on the day on which
the order confirming the interim order is made; and
294
(b) if it is not satisfied that any of the situations set out in paragraphs
(2)(a) to (c) existed or is likely to exist, make an order setting aside the
interim order.
(8) Notice — A person who makes an application under subsection (7) shall
give the Commissioner 48 hours written notice of the application.
Act
(9) Representations — At the hearing of an application under subsection
(7), the Tribunal shall provide the applicant, the Commissioner and any per-
son directly affected by the interim order with a full opportunity to present
evidence and make representations before the Tribunal makes an order under
that subsection.
(10) Prohibition of extraordinary relief — Notwithstanding section 13 of
the Competition Tribunal Act, an interim order shall not be appealed or re-
viewed in any court except as provided for by subsection (7).
(11) Duty of Commissioner — When an interim order is in effect, the
Commissioner shall proceed as expeditiously as possible to complete the in-
quiry arising out of the conduct in respect of which the order was made.
2002, c. 16, s. 12; 2017, c. 26, s. 13
Commentary
Under section 103.3, on an ex parte application of the Commissioner, an interim order would
be available, prior to the commencement of litigation, to prevent the continuation of certain
types of anti-competitive conduct:
• refusal to deal (s. 75);
• price maintenance (s. 76);
• exclusive dealing, tied selling and market restriction (s. 77);
• abuse of dominant position (s. 79);
• delivered pricing (s. 81); and
• refusal to supply by foreign supplier (s. 84).
In addition, an interim order would be available in situations where the Tribunal would not
be entitled to take measures under s. 82 (implementation of foreign judgment) or s. 83 (for-
eign directives). If the conduct is being engaged in by an entity incorporated under the Bank
Act, the Insurance Companies Act, the Trust and Loan Companies Act, or the Cooperative
Credit Associations Act, or a subsidiary of such an entity, the Commissioner must consult
with the Minister of Finance about the entity’s safety and soundness before applying for an
order under ss. 75 to 77, 79, 81 or 84 (subs. 103.3(3)).
Subsection 103.3(2) specifies the circumstances in which the Tribunal may make an interim
order. The order may issue if:
• injury to competition will occur that cannot be adequately remedied by the Tribunal;
• a person is likely to be eliminated as a competitor;
• a person is likely to suffer a significant loss of market share, a significant loss of reve-
nue, or other harm that cannot be adequately remedied by the Tribunal.
295
An interim order has affect for ten days (subs. 103.3(4)) but may be extended once or twice
for additional periods of 35 days each, upon application by the Commissioner on 48 hours
notice to each person against whom the interim order is directed (subs. 103.3(5)).
A person against whom an order is made has ten days to apply to the Tribunal to have the
order set aside or varied (subs. 103.3(7)). If the Tribunal remains satisfied that any of the
foregoing situations is likely to occur, it shall make an order confirming the interim order,
and fix the effective period of the interim order for a maximum of 70 days from the date of
the confirmation order. The Commissioner is entitled to 48 hours notice of the person’s ap-
plication (subs. 103.3(8)).
104. (1) Interim order — If an application has been made for an order under
this Part, other than an interim order under section 100 or 103.3, the Tribu-
nal, on application by the Commissioner or a person who has made an appli-
cation under section 75, 76 or 77, may issue any interim order that it considers
appropriate, having regard to the principles ordinarily considered by superior
courts when granting interlocutory or injunctive relief.
(2) Terms of interim order — An interim order issued under subsection
(1) shall be on such terms, and shall have effect for such period of time, as the
Tribunal considers necessary and sufficient to meet the circumstances of the
case.
(3) Duty of Commissioner — Where an interim order issued under sub-
section (1) on application by the Commissioner is in effect, the Commissioner
shall proceed as expeditiously as possible to complete proceedings under this
Part arising out of the conduct in respect of which the order was issued.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.12); 2002, c. 16, s. 13; 2015, c.
3, s. 39
Commentary
Section 104 interim orders may only be sought after an application to the Competition Tribu-
nal has been made under Part VIII (unlike section 100 interim orders).
Section 104 orders are issued by the Tribunal having regard to ordinary principles of injunc-
tive relief. Specifically, the applicant must establish that there is a serious issue to be tried;
that irreparable harm would be caused to the applicant if the injunctive relief requested is not
granted; and that the balance of convenience favours the granting of the order. (See RJR-
MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311 (S.C.C.).) This is
clearly a higher threshold test than the test Parliament prescribed for a section 100 interim
order.
In the Parkland case, the Commissioner of Competition successfully argued that protecting
consumers against the possible exercise of market power satisfied the “irreparable harm”
branch of the injunction test. Although the Parkland case ought to make it easier for the
Commissioner to obtain interim orders, the Commissioner does not typically obtain section
104 injunctions; since that case it has allowed transactions to close and proceeded to chal-
lenge them afterward. For example, see Competition Bureau, Press Release, “Competition
Bureau challenges Thoma Bravo’s acquisition of oil and gas reserves software firm
Aucerna” (17 June 2019) and Competition Bureau, Press Release, “Competition Bureau
296
challenges P&H’s acquisition of grain elevator from Louis Dreyfus in Virden, MB” (20 De-
cember 2019).
In the mergers context, the Parkland precedent establishes that, as a practical matter, a no-
tifiable transaction may be completed after the expiry of the applicable statutory waiting
periods, provided that the buyer is willing to hold separate any portion of the acquired busi-
ness at issue.
Act
When issuing a section 104 order, the Tribunal has the advantage of knowing the competi-
tion issues based on the application as well as any response from the respondent. Consistent
with that, the available terms of a section 104 order are broader than those of a section 100
order: under section 104, the Tribunal may issue such order as it considers appropriate for
such period of time as the Tribunal considers necessary to meet the circumstances of the
case. For guidance on the Competition Bureau’s policy approach to hold separate arrange-
ments in merger cases, see Melanie Aitken, Assistant Deputy Commissioner of Competition,
An Update on Merger Remedies Policy in Canada (British Institute for International and
Comparative Law Annual Merger Control Conference, London, England, November 16,
2007).
See also Antonio Di Domenico, Competition Enforcement and Litigation in Canada (To-
ronto: Emond Montgomery Publications Limited, 2019) at page 379 for a discussion of in-
terim orders under section 104, particularly as it relates to the Tribunal’s application of the
tripartite injunctive relief test set out in RJR-MacDonald Inc. v. Canada (Attorney General),
[1994] 1 S.C.R. 311 (S.C.C.).
Case Law
Commissioner of Competition v. Parkland Industries Ltd, 2015 Comp. Trib. 4 (Competition
Trib.) — The Competition Tribunal granted an interim injunction requiring Parkland Indus-
tries to preserve and “hold separate” six gas stations and eight supply agreements that it
proposed to acquire from Pioneer, the first time the Commissioner was able to obtain an
interim injunction preventing the integration of part of an acquired business on the grounds
that there would be adverse impact on consumers if those assets were merged. The Tribunal
concluded that there had to be “clear and non-speculative evidence” of “irreparable harm”
before such an interim order would be made, including evidence supporting market defini-
tion and market concentration. An offer by Parkland to resolve concerns by divesting assets
in certain markets was rejected by the Tribunal as inadequate to address the concerns raised
by the Commissioner. A remedy may obviate the need for an interim order, but only where
parties can persuade the Tribunal that the proposal is “viable and effective.” For a more
detailed commentary on this case, see A. Neil Campbell, “Holding Some Separate and
Scrambling the Rest: The Competition Tribunal’s Split Decision on a Retail Gasoline
Merger Injunction”, (2015) 15:3 The Threshold: Newsletter of the American Bar Association
Section of Antitrust Law Mergers & Acquisitions Committee 38.
Nadeau Poultry Farm Limited v. Groupe Westco Inc., 2012 Comp. Trib. 13 (Competition
Trib.) — The respondent applied to the Tribunal to enforce an undertaking by the applicant
to provide the respondent relief for damages suffered as a result of the interim relief re-
quested by the applicant if the application was ultimately unsuccessful. The applicant chal-
lenged the Tribunal’s authority to enforce the undertaking. The Tribunal held that it has
jurisdiction to enforce an undertaking provided to it in the context of an application for in-
terim relief brought under section 104 of the Act. The Tribunal’s power to enforce an under-
taking is necessarily incidental to its power to grant the injunction and it follows the princi-
ples ordinarily applied by superior courts when granting interlocutory or injunctive relief.
297
The purpose of an undertaking as to damages is to ensure that the defendant does not suffer
damages if unfairly deprived of his or her rights by an interlocutory injunction. The party
that requests a pre-trial remedy should bear this risk. The appropriateness of relief is a matter
within the discretion of the Tribunal and will turn on the specific circumstances of each case.
In this case, section 104 allows the Tribunal to issue interim relief in circumstances where it
is necessary to maintain the status quo until a determination is made on the allegations of
anticompetitive behaviour. The power to enforce an undertaking in damages does not mean
that the Tribunal has a general jurisdiction over damages.
Used Car Dealers Association of Ontario v. Insurance Bureau of Canada, 2012 Comp. Trib.
1 (Competition Trib.) — The respondent industry association brought a motion to rescind a
consent Interim Supply Order. The respondent had consented to the Interim Supply Order
but subsequently received instructions from one of its members to not supply the member’s
product to the applicant. The Tribunal denied the motion. The variation or rescission of an
interim order is extraordinary relief and requires the Tribunal to consider two questions: 1.
Are there new facts or changed circumstances which justify re-opening the original interim
order? 2. If so, is the requested relief appropriate? In the present circumstances, that raises
the question of whether the Interim Supply Order requested meets the tripartite test estab-
lished in RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311. The only
change of circumstances existing in this case is the member’s change of mind in a manner
which would frustrate the intent of a Tribunal order. In these circumstances, a change of
mind is not a change of circumstance which should ground a rescission of the Interim Supply
Order. The Tribunal also concluded, in obiter, that the requested relief would not have been
appropriate had the circumstances in fact changed. (The Tribunal also held that s. 104 and
not s. 106 is the governing provision for both the Interim Supply Order and for any amend-
ment or rescission of the Order.)
Nadeau Poultry Farm Ltd. v. Groupe Westco Inc., 2008 Comp. Trib. 16, 2008 CarswellNat
2591 (Competition Trib.) — The applicant, a chicken processor in New Brunswick, who was
granted leave under subs. 103.1(1) to bring an application under s. 75 against three of its
chicken suppliers, also applied for interim relief under s. 104. Interim relief was granted. In
assessing the irreparable harm element of the test for injunctive relief, the Tribunal held that
where direct evidence of harm is unavailable, the evidence relating to harm must be inferred.
In this case, the applicant could not provide direct evidence of harm because the respondents
were still supplying it with live chickens. However, the applicant had adduced compelling
evidence regarding the loss of profits it would suffer if the respondents’ terminated supply.
The Tribunal also distinguished this case from Quinlan’s of Huntsville Inc. v. Fred Deeley
Imports Ltd., 2004 Comp. Trib. 28 (Competition Trib.) by holding that where an applicant
deals in a commodity, which can be supplied for a variety of sources, there is a duty to
mitigate. In this case, the Tribunal noted that the applicant’s failure to mitigate was of little
or no consequence because of the magnitude of the lost supply. The Tribunal inferred that
even if the applicant had made diligent efforts to mitigate, its efforts could not have resulted
in replacing the lost supply in the short or medium term.
Canadian Standard Travel Agent Registry v. International Air Transport Assn., 2008 Car-
swellNat 2589, 2008 Comp. Trib. 12 (Competition Trib.) — CSTAR, a travel agency trade
association, sought leave under subs. 103.1 to begin a private action under s. 75 against the
International Air Transport Association regarding its decision to discontinue the use of paper
tickets and also applied for interim relief under s. 104. The application for interim relief was
denied. Typically, the Tribunal cannot grant a request for interim relief unless a s. 75 appli-
cation has been made. CSTAR’s request for leave under subs. 103.1 had not yet been deter-
mined. However, by characterizing the application as a motion in a pending proceeding, the
298
Tribunal established its jurisdiction over the matter. Because the Competition Tribunal Rules
do not address this particular issue directly, the gap rule in rule 34 of the Competition Tribu-
nal Rules applied. The gap rule allowed the Tribunal to rely on rule 372 of the Federal Court
Rules, which provides that in a case of urgency a party can apply for interim relief prior to
the commencement of a proceeding. In applying the test developed in RJR-MacDonald Inc.
v. Canada (Attorney General), [1994] 1 S.C.R. 311 (S.C.C.), the Tribunal held that the bal-
Act
ance of convenience did not favour the applicant and that requiring the continued use of
paper tickets in Canada would likely be ineffective and unenforceable.
Quinlan’s of Huntsville Inc. v. Fred Deeley Imports Ltd. (2004), 35 C.P.R. (4th) 517 (Com-
petition Trib.) — The exclusive Canadian distributor of particular motorcycles notified the
retailer that it would not be renewing the retailer agreement. The retailer proceeded to apply
to the Tribunal for leave to make an application for an order under the refusal to deal provi-
sions of the Act, and for an interim supply order under s. 104 of the Act. The Tribunal had
granted leave to make the application. The retailer submitted that the particular motorcycles,
clothing and accessories and motorcycle parts represented 55 to 60 per cent of its business.
The distributor argued that it had already ordered motorcycles from the manufacturer and
allocated its motorcycles to dealers for the 2005 model year. The interim supply order was
granted in part. Section 75 of the Act was meant to deal with situations where the product
was readily available and unencumbered by prior commitments to other purchasers. As the
only time of the year when the motorcycles for the 2005 model year were in ample supply
was before the distributor placed its order with the manufacturer, it was not appropriate to
order the distributor to supply the retailer with the 2005 model year motorcycles. The non-
seasonal merchandise and parts appeared to be in ample supply. As those items were only
supplied under the retailer agreement if ordered by the retailer, there was reason not to order
an interim supply.
Canada (Commissioner of Competition) v. Superior Propane Inc. (2000), 7 C.P.R. (4th) 385
(Competition Trib.) — The Commissioner had filed an application under s. 92 opposing the
merger of two companies which marketed propane products and services. Pending the hear-
ing of the matter, the parties had entered into a consent interim order. The Competition Tri-
bunal eventually dismissed the Commissioner’s application under s. 92, and declared that the
consent interim order was terminated given the dismissal of the s. 92 application. The Com-
missioner brought a motion for an order staying the order of the Tribunal on the basis that
the Tribunal no longer had jurisdiction to hear and decide issues arising under s. 104 of the
Act given the dismissal of the application under s. 92. The Commissioner sought the stay on
the basis of an intended appeal with respect to the s. 104 order to the Federal Court. In
dismissing the motion, the Tribunal determined that the intended appeal did not raise a seri-
ous issue and the balance of convenience favoured the companies.
Canada (Commissioner of Competition) v. Superior Propane Inc. (2000), 261 N.R. 50,
[2001] 3 F.C. 175, 2000 CarswellNat 2172, 2000 CarswellNat 3577 (Fed. C.A.) — Follow-
ing the dismissal of the Commissioner’s application under s. 92 opposing the merger of two
companies, the Commissioner appealed the dismissal to the Federal Court of Appeal. The
Commissioner also appealed the decision of the Tribunal which concluded that the consent
interim order (the hold-separate order) made pursuant to s. 104 of the Competition Act auto-
matically terminated with the decision dismissing the s. 92 application. The Commissioner
sought a stay of both the Tribunal’s s. 92 decision and its decision with respect to the consent
interim order pending determination of the appeal. Both parties agreed that the three-criteria
test set out in RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311, 54
C.P.R. (3d) 114, (sub nom. RJR-MacDonald Inc. c. Canada (Procureur général))) 164 N.R.
1, (sub nom. RJR-MacDonald Inc. c. Canada (Procureur général))) 60 Q.A.C. 241, 111
299
D.L.R. (4th) 385, 1994 CarswellQue 120F, 1994 CarswellQue 120 (S.C.C.) was the applica-
ble test for a stay pending the appeal. The appellate court found that the conflicting interpre-
tations of the efficiency defence in s. 96 raised a serious issue on appeal. In regard to the
second criteria, however, the Commissioner failed to establish that irreparable harm would
be caused if the stay was not granted. Although unwinding the merger through divestiture
after the fact would be difficult, it was not impossible. Accordingly, the motion for a stay
was dismissed but an order was made expediting the hearing of the appeal.
104.1 [Repealed 2009, c. 2, s. 433.]
105. (1) Consent agreement — The Commissioner and a person in respect

of whom the Commissioner has applied or may apply for an order under this
Part, other than an interim order under section 103.3, may sign a consent
agreement.
(2) Terms of consent agreement — The consent agreement shall be
based on terms that could be the subject of an order of the Tribunal against
that person.
(3) Registration — The consent agreement may be filed with the Tribunal
for immediate registration.
(4) Effect of registration — Upon registration of the consent agreement,
the proceedings, if any, are terminated, and the consent agreement has the
same force and effect, and proceedings may be taken, as if it were an order of
the Tribunal.
2, s. 434
Commentary
Section 105 permits Commissioner of Competition and a person against whom an order has
been or may be applied for under Part VIII may sign a consent agreement. The agreement
may not include any terms that the Tribunal could not make in an order. The agreement may
then be filed with the Tribunal, and upon registration, shall have the same effect as an order
of the Tribunal itself.
Case Law
Bank of Montreal v. Canada (Commissioner of Competition), 2013 Comp. Trib. 12 (Compe-
tition Trib.) — The Tribunal granted a consent order that was varied on three occasions to
expand the range of institutions eligible to issue cards and provide access to funds through
the Interac network. One variation was necessitated by changes to the federal financial insti-
tutions legislation, which expanded eligibility in the Canadian Payments Association to in-
clude life insurance companies, securities dealers, and money market mutual funds.
In 2013, the Tribunal approved a request filed by the Interac Association to allow it to oper-
ate under a cost-recovery model. Among the assurances sought by the Competition Bureau
before approving the proposal were specific guarantees that Interac Association would retain
safeguards ensuring open and non-discriminatory access to its Interac network. The applica-
tion was granted with the consent order varied to include that Interac revenue was to be
300
Part VIII — Reviewable Matters (ss.75-107) S. 106(1)(b)
derived entirely from switch fees, except where nonswitch fee revenue would have no mate-
rial effect on any market, and Interac would provide the Commissioner with advanced notice
of any new non-switch fee revenue.
Canada (Commissioner of Competition) v. Abitibi-Consolidated Inc., 2002 Comp. Trib. 3
(Competition Trib.) — Following the acquisition of a competitor, Abitibi agreed to an under-
taking to resolve the Commissioner’s concerns respecting the merger. The undertaking pro-
Act
vided for the divestiture of a mill within one year after which the Commissioner could ap-
point an independent agent. The parties also agreed that the Commissioner would have the
option to seek a consent order of the Tribunal under s. 105 of the Act. Disputes had arisen
between the parties, and the Commissioner applied for a consent order. The Commissioner
brought a motion for directions relating to the proper procedure to resolve the disputes that
had arisen between the parties with respect to the sale of the mill. The Tribunal concluded
that there was not a proper consent order application before it, as Abitibi had not consented
to the particular order. The consent to the undertaking did not constitute consent to a particu-
lar draft consent order, and therefore, the consent order was not a consent order within the
meaning of the undertaking. As a result, the Tribunal did not have jurisdiction to deal with
the matters related to the application.
Canada (Commissioner of Competition) v. Trilogy Retail Enterprises L.P., 2001 Comp. Trib.
29, 14 C.P.R. (4th) 216 (Competition Trib.) — The Commissioner applied for a consent or-
der in respect of an acquisition and a proposed merger of two bookselling companies. The
basis of the application was that the acquisition and proposed merger would likely prevent or
lessen competition substantially in the distribution of trade books nationally and locally. The
parties submitted a draft consent order requiring the divestiture of certain stores, and certain
online services. An intervener argued that a prospective purchaser required a critical mass of
stores to compete effectively against the merged entity. The consent order was issued as the
Tribunal was satisfied that the order would, in all likelihood, eliminate the substantial lessen-
ing of competition presumed to arise from the merger. There was no evidence to support the
intervener’s position that more superstores were required in the divestiture package to create
a critical mass of stores. Moreover, the scope of review in consent proceedings was narrower
than in contested proceedings. The Tribunal was only bound to approve a remedy that would
restore competition to a level where it would no longer be substantially less than it was
before the merger.
106. (1) Rescission or variation of consent agreement or order —

The Tribunal may rescind or vary a consent agreement or an order made
under this Part other than an order under section 103.3 or a consent agree-
ment under section 106.1, on application by the Commissioner or the person
who consented to the agreement, or the person against whom the order was
made, if the Tribunal finds that
(a) the circumstances that led to the making of the agreement or order
have changed and, in the circumstances that exist at the time the applica-
tion is made, the agreement or order would not have been made or would
have been ineffective in achieving its intended purpose; or
(b) the Commissioner and the person who consented to the agreement
have consented to an alternative agreement or the Commissioner and the
person against whom the order was made have consented to an alterna-
tive order.
301
(2) Directly affected persons — A person directly affected by a consent

agreement, other than a party to that agreement, may apply to the Tribunal
within 60 days after the registration of the agreement to have one or more of
its terms rescinded or varied. The Tribunal may grant the application if it
finds that the person has established that the terms could not be the subject of
an order of the Tribunal.
2, s. 435
Commentary
The Commissioner or the person who consented to an agreement pursuant to section 105
may apply to the Tribunal to rescind or vary the consent agreement that has been registered
or an order made under Part VIII if the circumstances that led to such agreement or order
have changed, and under the current circumstances, the agreement or order would not have
been made or would have been ineffective in achieving its intended purpose.
Subsection 106(2) allows a third parties “directly affected” by a consent agreement to apply
to have terms rescinded or varied. The meaning of the phrase “directly affected” was consid-
ered in the Burns Lake case. See also M. Nicholson, C. Hersh and Y. Ermak, “Challenges to
Consent Agreements after Burns Lake”, Canadian Competition Record (Fall 2006) at 102.
Case Law
Canada (Commissioner of Competition) v. Canadian Real Estate Assn., 2015 Comp. Trib. 3
(Comp. Trib.) — The Tribunal’s approach to interpreting consent agreements recognizes that
there are two important qualifications to principles otherwise applicable to the interpretation
of contracts: (1) unlike private contracts, s. 105 of the Act deems consent agreements that are
registered with the Tribunal to have the same force and effect as if they were an order of the
Tribunal. Non-compliance with a consent agreement can, therefore, give rise to contempt. As
a result, consent agreements must be clear and capable of enforcement, and any ambiguities
should be construed in favour of the respondent; (2) given the remedial context in which
consent agreements are drafted, a consent agreement must also be interpreted in light of the
purpose and objects of the Competition Act. Applying these principles, the Tribunal con-
firmed CREA’s right, pursuant to a consent agreement previously entered into with the Com-
missioner, to prohibit the display of a private seller’s contact information or the reference to
a private sale on webpages that are linked directly from realtor.ca.
Kobo Inc. v. The Commissioner of Competition, 2014 Comp. Trib. 14; affirmed Rakuten
Kobo Inc. v. Canada (Commissioner of Competition), 2015 CarswellNat 12187 (F.C.A.);
leave to appeal refused 2016 CarswellNat 51 (S.C.C.) — The jurisdiction of the Competition
Tribunal on an application under s. 106(2) is limited to assessing: (1) whether the terms of a
consent agreement are not within the scope of the type of orders that the Tribunal is permit-
ted to issue in respect of the reviewable trade practice in question; (2) whether the consent
agreement (a) identifies each of the substantive elements of the reviewable trade practice in
question, and (b) contains either (i) an explicit agreement between the Commissioner of
Competition and the respondent(s) that each of those elements has been met, or (ii) a state-
ment that the Commissioner has concluded that each of those elements has been met, to-
gether with a statement by the respondent(s) that they do not contest that conclusion; and (3)
whether the terms of the consent agreement are unenforceable because, for example, they are
too vague or would require perpetual monitoring by the Tribunal. Since the purpose of s.
106(2) is to facilitate resolutions that expeditiously address competition concerns with cer-
302
tainty and finality, it is not open to applicants to attempt to establish that substantive ele-
ments of a reviewable trade practice have not been met or that a defence or exception is
applicable. Kobo’s appeal was dismissed by the Federal Court of Appeal substantially for the
reasons given by the Tribunal. In 2015, the Tribunal rejected Kobo’s application to pause a
hearing to amend or adjust the consent agreement until the Supreme Court delivers an inter-
pretation of s. 106. According to the Tribunal, Kobo failed to prove the continuation of pro-
Act
ceedings would result in “irreparable harm.” For Kobo to be harmed, the Supreme Court
would have to agree to hear its appeal and rule in favour of its interpretation. In the
meantime, the Tribunal would have to decide to leave the consent agreement in place. As a
result, the Tribunal held that a delay to the hearing was not “in the interest of justice.”
In June 2016, the Tribunal revoked the 2014 consent agreement, rejecting Kobo’s request for
an order that would have prevented the Competition Bureau from resolving its competition
concerns in the ebooks industry with a new consent agreement. The Tribunal found that in
order to exercise its jurisdiction, the Commissioner must provide enough detail to give the
Tribunal sufficient understanding of the legal basis for the consent agreement. Since the
consent agreement between the Commissioner and the respondent publishers did not contain
such information, the agreement was fatally flawed.
Rakuten Kobo Inc. v. Canada (Commissioner of Competition), 2018 FC 64 — In February
2018, the Federal Court dismissed Kobo’s application for judicial review of the Commis-
sioner’s decision to enter into new consent agreements with the respondent publishers, fol-
lowing the Tribunal’s decision to set aside the 2014 agreement described below. The Court
declined to hear Kobo’s application on the grounds that judicial review applications brought
by third parties in respect of consent agreements should only be heard in exceptional cases.
However, in the event the Court erred in not considering Kobo’s application, the Court also
addressed the merits of Kobo’s application. Most notably, the Court concluded that s. 90.1 of
the Competition Act applies to all agreements or arrangements that involve a Canadian ele-
ment, regardless of whether they are entered into within or outside Canada.
Burns Lake Native Development Corp. v. Canada (Commissioner of Competition) (2006), 47
C.P.R. (4th) 343 (F.C.A.) — The applicants applied to the Tribunal to have the consent
agreement rescinded or varied pursuant to s. 106 of the Act. The Commissioner referred to
the Tribunal, pursuant to s. 124.2 of the Act, for determination of the nature and scope of
their interest sufficient to satisfy the “directly affected” requirement for standing in s. 106 of
the Act. In addition, the Commissioner sought a determination of whether or not the facts in
the notice of the application established that the applicants were directly affected. The Tribu-
nal held that bringing a reference after the applicants filed their s. 106 application was not
procedurally improper. The applicants appealed, and their appeals were dismissed. The
Commissioner’s power to make a reference under s. 124(2) of the Act “at any time” enabled
the Commissioner to refer a question arising in the course of a proceeding before the Tribu-
nal to which the Commissioner was a party. The questions referred for determination were
not improper on the ground that they were academic, hypothetical or advisory in nature. As a
reference under s. 124.2(2) of the Act may be made outside the context of a specific proceed-
ing, the case law under s. 18.3 of the Federal Courts Act did not apply. The Tribunal held
that the question of whether the applicants were directly affected would be answered on the
assumption that the facts set out by the applicants were true. As the facts were not in dispute
for the purpose of the reference, the question was one of law alone.
Symbol Technologies Canada ULC v. Barcode Systems Inc. (2005), 43 C.P.R. (4th) 291
(Competition Trib.) — The respondent obtained leave of the Tribunal to apply for an order
under s. 75 (refusal to deal) of the Act. The respondent alleged that the applicant had refused
to sell its barcode scanners to the respondent, which the respondent had previously distrib-
303
uted in Western Canada for a ten-year period. The Tribunal’s order granting leave was
stayed pending an appeal to the Federal Court of Appeal, which was dismissed. Before leave
was granted, an interim receiver was appointed for the assets and undertakings of the respon-
dent. The interim receiver subsequently sold the assets of the respondent. The applicant ap-
plied pursuant to s. 106 of the Act for an order rescinding the order granting leave. It was the
position of the applicant that the Tribunal would not have granted leave had the respondent’s
assets and business been sold when leave was sought. The applicant moved pursuant to s. 9
of the Competition Tribunal Act for summary disposition of the application for a rescission
order. The motion and the s. 106 application were granted as the respondent only existed as a
shell corporation, and had never applied to lift the stay of proceedings. Moreover, the re-
spondent had never applied for an interim order to maintain supply, as it was out of business.
With the change in circumstances since the leave was granted, and in the circumstances
which existed when the applicant filed its s. 106 application, leave would not have been
granted.
United Grain Growers Ltd. v. Canada (Commissioner of Competition) (2005), 43 C.P.R.
(4th) 343 (Competition Trib.) — The applicant and the Commissioner entered into a consent
agreement to resolve the Commissioner’s concerns regarding competition in the market for
the provision of port terminal grain handling services in the Port of Vancouver. The consent
agreement provided that the applicant was to divest its interest in a Vancouver terminal by a
certain date, following which a trustee would be appointed to complete the divestiture. After
extending the sale period on eleven occasions, the applicant sought a twelfth extension, but
the Commissioner refused. The applicant then applied to the Tribunal under s. 106 of the Act
for an order rescinding the consent agreement. The applicant submitted that independent
grain companies were able to secure port terminal grain handling services in the Port of
Vancouver at competitive rates. A farmer-controlled marketing organization was successful
in requesting leave to intervene in the proceedings before the Tribunal. The organization and
is member producers were directly impacted by the issues of whether or not the consent
agreement would be rescinded, and whether or not the divestiture occurred. The organization
was in a unique position to make original representations relating to whether or not changed
circumstances meant that the consent agreement should no longer be maintained.
RONA Inc. v. Canada (Commissioner of Competition) (2005), 42 C.P.R. (4th) 53 (Competi-
tion Trib.) — The applicant applied to rescind the consent agreement, which it had signed
with the Commissioner, concerning the divestiture of a store following the applicant’s
merger with a main competitor in the big box home renovation market. With the merger, the
applicant became the owner of the only two big box stores in the particular urban area.
However, after the merger, the applicant’s main competitor planned to open a new big box
store in the same urban area. The Tribunal found that the circumstances had changed, and
that in the new circumstances, the parties would not have signed the agreement. Although
consent orders should be enforceable, there would be no substantial lessening of competition
in this market. Moreover there was no evidence of abuse of process by the applicant in
unduly delaying the sale of its store. The application was within two years of the transaction,
which was within the time frame envisaged by the Bureau’s own guidelines.
Canadian Waste Services Holdings Inc. v. Canada (Commissioner of Competition) (2004),
33 C.P.R. (4th) 275 (Competition Trib.) — The Tribunal found that the applicant’s acquisi-
tion of a landfill facility as part of its acquisition of the solid waste business of its major
competitor would likely substantially prevent and lessen competition for the disposal of ICI
waste in two markets, and ordered the divestiture of the landfill facility. The Tribunal had
concluded that environmental assessments for expansion of two of the applicant’s existing
landfill sites were likely to be approved, and as a result, excess capacity would be available.
304
After the divestiture order, one landfill expansion was quashed by the Divisional Court and
the Minister of the Environment required an environmental assessment for the other landfill
expansion. As approval for the expansions would require several years, the applicant applied
for an order rescinding or varying the divestiture order. The application was dismissed as the
applicant had misled the Tribunal when the divestiture order was made. The divestiture order
was based on its prediction that excess capacity was likely to develop due to ministerial
Act
approval. At the time of the s. 92 hearing, the Tribunal was not told about two applications
for judicial review being filed with the court to quash the Minister’s approval. The alleged
changes in circumstances were not bona fide as they existed only because the applicant
failed to provide the Tribunal with all relevant facts.
Canadian Waste Services Holdings Inc. v. Canada (Commissioner of Competition) (2004),
33 C.P.R. (4th) 267 (Fed. C.A.) — The Tribunal found that the applicant’s acquisition of a
landfill facility as part of its acquisition of the solid waste business of its major competitor
would likely substantially prevent and lessen competition for the disposal of ICI waste in
two markets, and ordered the divestiture of the landfill facility. The Tribunal had concluded
that environmental assessments for expansion of two of the applicant’s existing landfill sites
were likely to be approved, and as a result, excess capacity would be available. After the
divestiture order, one landfill expansion was quashed by the Divisional Court and the Min-
ister of the Environment required an environmental assessment for the other landfill expan-
sion. As approval for the expansions would require several years, the applicant applied for an
order rescinding or varying the divestiture order pursuant to s. 106 of the Act. The applica-
tion was dismissed as the applicant had misled the Tribunal when the divestiture order was
made. The applicant appealed the s. 106 decision to the Federal Court of Appeal, and
brought a motion for a stay of the divestiture order. The stay was granted as there was a
serious issue for appeal concerning the applicant’s duty to inform the Tribunal of a freshly
commenced judicial review application, which it wrongly considered had little chance of
success. If no stay were granted, the applicant would be required to divest an economically
attractive asset, and would not be able to reacquire it, if the appeal were successful. The
harm would not be compensable in damages as there was no right in law to claim damages
from the Commissioner.
(Competition Trib.); reversed [1994] 1 F.C. 154, 49 C.P.R. (3d) 417, 104 D.L.R. (4th) 129,
157 N.R. 258 (C.A.); leave to appeal refused (1993), 49 C.P.R. (3d) ix (note), 104 D.L.R.
(4th) vii (note) (S.C.C.) — The words, “the circumstances that led to the making of the or-
der”, as used in s. 106 of the Act are to be read according to their ordinary grammatical
sense. This involves a determination of the existence of a simple causal relationship between
the circumstances and the order, but no more. In other words, it is not necessary that the
relationship be direct or demonstrable, other than in the very limited sense that the Tribunal
must be satisfied that it exists. Thus, the Federal Court of Appeal ruled that the Tribunal
erred in holding that the latter lacked jurisdiction under s. 106 to vary a consent order made
in 1989 which had merged the computer reservation systems (“CRS”) of Air Canada and
Canadian Airlines International (“Canadian”) into a limited partnership known as “Gemini”.
The variation was sought so as to allow financially strapped Canadian to complete a transac-
tion with American Airlines by terminating its agreement with Gemini and substituting
American Airline’s Sabre CRS. It was argued that if the transaction was not completed,
Canadian would collapse, resulting in Air Canada obtaining a monopoly in air travel in Can-
ada. The Tribunal ruled that since the maintenance of a duopoly was not the main reason for
the original order, this argument did not constitute grounds for a variation. On appeal, the
Federal Court of Appeal ruled that since the Tribunal had found that a duopoly of air trans-
portation in Canada had been a consideration in making the original order, it should have
305
then found that the original consent order would not have been made if Canadian had been in
its current financial situation at that time.
The case was ordered remanded to the Tribunal for reconsideration subject to the limitation
that, in exercising its power to vary its original order, the Tribunal could do no more than it
could have done pursuant to the original order. This limitation was based on the ruling that
the use of the word “vary” in s. 106 did not give the Tribunal an unlimited and independent
power to impose new terms on what was previously a consent order. Thus, since the original
order had been made pursuant to s. 92 of the Act, in making a variation, the Tribunal could
only do what was authorized by that provision.
Canada (Dir. of Investigation & Research) v. Imperial Oil (1990), 31 C.P.R. (3d) 277 (Com-
petition Trib.); affirmed (1992), 41 C.P.R. (3d) 483 (Fed. C.A.) — See entry under Competi-
tion Tribunal Act, s. 9.
Southam Inc. v. Canada (Director of Investigation & Research) (1998), 78 C.P.R. (3d) 341
(Competition Trib.) — The applicants who were related newspaper publishers sought a vari-
ation of the Tribunal’s order pursuant to s. 106. The Tribunal found that common ownership
of two community newspapers resulted in substantial lessening of competition in the adver-
tising market, and ordered divestiture of one of the two newspapers. The applicants sought
an alternative remedy being the divestiture of only one edition of one of the two newspapers,
and its sale to a new paper. Under s. 106(a), the applicants must establish that the circum-
stances that led to the making of the original order had changed, and that in the changed
circumstances, the original order would not have been made. Although the circumstances
had changed with the emergence of a competing paper, the Tribunal concluded that the new
paper would not provide effective competition if it acquired the edition proposed. As a re-
sult, the variation application was denied.
Washington v. Canada (Director of Investigation & Research) (1998), 78 C.P.R. (3d) 479
(Competition Trib.) — A prior application of the Director concerning a merger resulted in a
consent order requiring the divestiture of certain assets. The original respondents to the di-
vestiture order and the Director together brought a consent variation application dispensing
with the divestiture package due to the entry of a new effective competitor in the market. A
prospective purchaser of the divestiture package sought leave to intervene in the consent
variation proceedings. Leave to intervene was denied as the Tribunal was not satisfied that
the intervener would bring a unique or distinct perspective of the subject-matter in dispute.
Although the Director had consented to the variation, it did not create an evidentiary void as
the Director still retained the responsibility to represent the public interest and investigate the
proposed variation.
106.1 (1) Consent agreement — parties to a private action — If a

person granted leave under section 103.1 makes an application to the Tribunal
for an order under section 75, 76 or 77 and the terms of the order are agreed
to by the person in respect of whom the order is sought and consistent with the
provisions of this Act, a consent agreement may be filed with the Tribunal for
registration.
(2) Notice to Commissioner — On filing the consent agreement with the
Tribunal for registration, the parties shall serve a copy of it on the Commis-
sioner without delay.
(3) Publication — The consent agreement shall be published without delay
in the Canada Gazette.
306
Part IX — Notifiable Transactions (ss. 108–124) S. 108(1) equ
(4) Registration — The consent agreement shall be registered 30 days after

its publication unless a third party makes an application to the Tribunal
before then to cancel the agreement or replace it with an order of the
Tribunal.
(5) Effect of registration — Upon registration, the consent agreement has
Act
the same force and effect, and proceedings may be taken, as if it were an order
of the Tribunal.
(6) Commissioner may intervene — On application by the Commis-
sioner, the Tribunal may vary or rescind a registered consent agreement if it
finds that the agreement has or is likely to have anti-competitive effects.
(7) Notice — The Commissioner must give notice of an application under
subsection (6) to the parties to the consent agreement.
2002, c. 16, s. 14; 2015, c. 3, s. 40
Commentary
If a private party was granted leave under s. 103.1 to bring an application to the Tribunal for
an order under s. 75, 76 or 77, and the terms of the order are agreed by the person again
whom the order is sought, a consent agreement may be filed with the Tribunal for registra-
tion (subs. 106.1(1)). The agreement is to be registered within 30 days, unless a third party
applies within that period to cancel or replace it (subs. 106.1(4)). The Commissioner may
also apply to have the consent agreement rescinded or varied on the grounds that it would be
likely to have anti-competitive effects (subs. 106.1(6)).
To date, no consent agreements have been registered with the Tribunal by private parties
pursuant to section 106.1.
107. Evidence — In determining whether or not to make an order under this

Part, the Tribunal shall not exclude from consideration any evidence by rea-
son only that it might be evidence in respect of an offence under this Act or in
respect of which another order could be made by the Tribunal under this Act.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
PART IX — NOTIFIABLE TRANSACTIONS (SS. 108–124)

[See Summary Flow Chart for Prenotification for the prenotification provisions in
this part.]
Interpretation
108. (1) Definitions — In this Part,
“equity interest” means
(a) in the case of a corporation, a share in the corporation; and
(b) in the case of an entity other than a corporation, an interest that enti-
tles the holder of that interest to receive profits of that entity or assets of
that entity on its dissolution.
307
S. 108(1) ope Competition Act
“operating business” means a business undertaking in Canada to which em-

ployees employed in connection with the undertaking ordinarily report for
work;
“person” means an entity, an individual, a trustee, an executor, an administra-
tor or a liquidator of the succession, an administrator of the property of others
or a representative, but does not include a bare trustee or a trustee responsible
exclusively for preserving and transferring the property of a person;
“prescribed” means prescribed by regulations made under section 124;
“voting share” means any share that carries voting rights under all circum-
stances or by reason of an event that has occurred and is continuing.
(2) Entities controlled by Her Majesty — For the purposes of this Part,
except section 113, one entity is not affiliated with another entity by reason
only of the fact that both entities are controlled by Her Majesty in right of
Canada or a province, as the case may be.
Commentary
Further guidance as to the meaning of the phrase “operating business” may be found the
Competition Bureau’s Pre-Merger Notification Interpretation Guideline Number 1: Defini-
tion of “Operating Business” (section 108 of the Act). As noted in the guideline, the word
“business” is broadly defined in section 2 of the Competition Act. Other legislation, such as
the Investment Canada Act defines the word more narrowly to include “any undertaking or
enterprise capable of generating revenue and carried on in anticipation of profit”. Thus,
under the Investment Canada Act an undertaking must be actively earning revenue or be in a
present position to produce revenue earning goods or services to qualify as a business. This
is not a requirement under the Competition Act. In practice, the “operating business” require-
ment therefore sets a very low threshold and rarely operates to exempt a transaction from
pre-merger notification.
On the face of the definition of “voting shares,” the number of directors an owner of those
shares can elect is irrelevant. That is because the definition of “voting shares” does not in-
clude a requirement to have the right to elect directors, unlike the “securities” referred to in
the definition of “control” in subsection 2(4) of the Act. That likely means that a buyer
could, for example, acquire 100% of the shares to elect directors without triggering a pre-
merger notification requirement, as long as it owned less than 20% or 35% of all “voting
shares” aggregated across all share classes. What is important in these circumstances is the
percentage of overall votes being acquired, not the percentage of voting shares being ac-
quired; so, for example, a multiple voting share will count for as many votes as it represents,
not merely one voting share.
Shareholders’ agreements are also not relevant for the analysis. Hence, a shareholder could
in connection with a transaction acquire through contract a right to elect more than 50% of a
corporation’s directors without triggering a notification requirement, provided the 20% or
35% ownership thresholds were not exceeded.
Further guidance as to the meaning of the phrase “voting shares” may be found the Competi-
tion Bureau’s Pre-Merger Notification Interpretation Guideline Number 5: Acquisitions of
Non-Voting Shares and Convertible Securities (section 110(3) of the Act).
308
Part IX — Notifiable Transactions (ss. 108–124) S. 109
Application
109. (1) General limit relating to parties — This Part does not apply in
respect of a proposed transaction unless the parties thereto, together with
their affiliates,
Act
(a) have assets in Canada that exceed four hundred million dollars in ag-
gregate value, determined as of such time and in such manner as may be
prescribed, or such greater amount as may be prescribed; or
(b) had gross revenues from sales in, from or into Canada, determined for
such annual period and in such manner as may be prescribed, that exceed
four hundred million dollars in aggregate value, or such greater amount
as may be prescribed.
(2) Parties to acquisition of shares or interest — For the purposes of
this Part,
(a) the parties to a proposed acquisition of shares are the person or per-
sons who propose to acquire the shares and the corporation whose shares
are to be acquired; and
(b) the parties to a proposed acquisition of an interest in a combination
are the person or persons who propose to acquire the interest and the
combination whose interest is to be acquired.
Commentary
Subsection 109(1) sets out the first “threshold” for ascertaining whether pre-merger notifica-
tion is required and is based on the size of the parties to the proposed transaction together
with their affiliates. The second threshold is the size of the proposed transaction itself as
described in section 110. If the thresholds in sections 109 and 110 are met, then Part IX will
apply to the proposed transaction. Section 114 imposes the formal pre-merger notification
obligation to proposed transactions subject to Part IX.
See subsections 2(2), 2(3), 2(4) and 108(2) and related commentary for information relating
to the definition of “affiliate” for the purposes of subsection 109(1).
Information about the calculation of assets and gross revenues may be found in the Notifi-
able Transactions Regulations and the Competition Bureau’s draft Pre-Merger Notification
Guideline Number 15: Assets in Canada and Gross Revenues From Sales in, from or into
Canada (Sections 109 and 110 of the Act).
under the Competition Act: Procedures Guide (Ottawa: Competition Bureau, 2010).
Paragraph 109(2)(a) stipulates that the parties to a proposed acquisition of shares are the
person or persons who propose to acquire the shares and the corporation the shares of which
are to be acquired. This can result in apparently unusual outcomes. For instance, where there
is a private sale of shares between a purchaser and a vendor that is a shareholder, it is the
corporation whose shares are the subject of the transaction, which is not a party to the agree-
ment, that would have a notification obligation, not the vendor. From a pre-merger notifica-
tion perspective this is nevertheless a desirable outcome as it is the business activities of the
target and not the vendor that will be relevant to an assessment of competitive effects. Para-
309
graph 109(2)(b) is an analogous provision for the proposed acquisition of an interest in a

combination.
110. (1) Application of Part — This Part applies only in respect of pro-
posed transactions described in this section.
(2) Acquisition of assets — Subject to sections 111 and 113, this Part ap-
plies in respect of a proposed acquisition of any of the assets in Canada of an
operating business if the aggregate value of those assets, determined as of the
time and in the manner that is prescribed, or the gross revenues from sales in
or from Canada generated from those assets, determined for the annual pe-
riod and in the manner that is prescribed, would exceed the amount deter-
mined under subsection (7) or (8), as the case may be.
(3) Acquisition of shares — Subject to sections 111 and 113, this Part ap-
plies in respect of a proposed acquisition of voting shares of a corporation that
carries on an operating business or controls an entity that carries on an oper-
ating business
(a) if
(i) the aggregate value of the assets in Canada, determined as of the
time and in the manner that is prescribed, that are owned by the
corporation or by entities controlled by that corporation, other than
assets that are equity interests in those entities, would exceed the
amount set out in subsection (7) or the amount determined under
subsection (8), as the case may be, or
(ii) the gross revenues from sales in or from Canada, determined for
the annual period and in the manner that is prescribed, generated
from the assets referred to in subparagraph (i) would exceed the
amount determined under subsection (7) or (8), as the case may be;
and
(b) if, as a result of the proposed acquisition of the voting shares, the per-
son or persons acquiring the shares, together with their affiliates, would
own voting shares of the corporation that in the aggregate carry more
than the following percentages of the votes attached to all the corpora-
tion’s outstanding voting shares:
(i) 20%, if any of the corporation’s voting shares are publicly traded,
(ii) 35%, if none of the corporation’s voting shares are publicly
traded, or
(iii) 50%, if the person or persons already own more than the per-
centage set out in subparagraph (i) or (ii), as the case may be, before
the proposed acquisition.
(4) Amalgamation — Subject to subsection (4.1) and section 113, this Part
applies in respect of a proposed amalgamation of two or more entities if one or
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Part IX — Notifiable Transactions (ss. 108–124) S. 110(5)(b)
more of those entities carries on an operating business, or controls an entity

that carries on an operating business, and if
(a) the aggregate value of the assets in Canada, determined as of the time
and in the manner that is prescribed, that would be owned by the contin-
uing entity that would result from the amalgamation or by entities con-
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trolled by the continuing entity, other than assets that are equity interests
in those entities, would exceed the amount set out in subsection (7) or the
amount determined under subsection (8), as the case may be; or
(b) the gross revenues from sales in or from Canada, determined for the
annual period and in the manner that is prescribed, generated from the
assets referred to in paragraph (a) would exceed the amount determined
under subsection (7) or (8), as the case may be.
(4.1) General limit — parties to amalgamation — This Part does not
apply in respect of a proposed amalgamation of two or more entities if one or
more of those entities carries on an operating business or controls an entity
that carries on an operating business, unless each of at least two of the amalga-
mating entities, together with its affiliates,
(a) has assets in Canada, determined as of the time and in the manner
that is prescribed, that exceed in aggregate value the amount determined
under subsection (7) or (8), as the case may be; or
(b) has gross revenues from sales in, from or into Canada, determined for
the annual period and in the manner that is prescribed, that exceed in
aggregate value the amount determined under subsection (7) or (8), as the
case may be.
(5) Combination — Subject to sections 112 and 113, this Part applies in re-
spect of a proposed combination of two or more persons to carry on business
otherwise than through a corporation if one or more of those persons proposes
to contribute to the combination assets that form all or part of an operating
business carried on by those persons, or entities controlled by those persons,
and if
(a) the aggregate value of the assets in Canada, determined as of the time
and in the manner that is prescribed, that are the subject-matter of the
combination would exceed the amount determined under subsection (7)
or (8), as the case may be; or
(b) the gross revenues from sales in or from Canada, determined for the
annual period and in the manner that is prescribed, generated from the
assets referred to in paragraph (a) would exceed the amount determined
under subsection (7) or (8), as the case may be.
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(6) Combination — Subject to sections 111, 112 and 113, this Part applies in
respect of a proposed acquisition of an interest in a combination that carries
on an operating business otherwise than through a corporation
(a) if
(i) the aggregate value of the assets in Canada, determined as of the
time and in the manner that is prescribed, that are the subject-mat-
ter of the combination would exceed the amount determined under
subsection (7) or (8), as the case may be, or
(ii) the gross revenues from sales in or from Canada, determined for
the annual period and in the manner that is prescribed, generated
from the assets referred to in subparagraph (i) would exceed the
amount determined under subsection (7) or (8), as the case may be;
and
(b) if, as a result of the proposed acquisition of the interest, the person or
persons acquiring the interest, together with their affiliates, would hold
an aggregate interest in the combination that entitles the person or per-
sons to receive more than 35% of the profits of the combination, or more
than 35% of its assets on dissolution, or, if the person or persons acquir-
ing the interest are already so entitled, to receive more than 50% of such
profits or assets.
(7) Amount for notification — In the year in which this subsection comes
into force, the amount for the purposes of subsections (2) to (6) is $70,000,000.
(8) Amount for notification — subsequent years — In any year fol-
lowing the year in which subsection (7) comes into force, the amount for the
purposes of any of subsections (2) to (6) is
(a) any amount that is prescribed for that subsection; or
(b) if no amount has been prescribed for that subsection,
(i) the amount determined by the Minister in January of that year by
rounding off to the nearest million dollars the amount arrived at by
using the formula
A × (B )
C
where
A is the amount for the previous year,
B is the average of the Nominal Gross Domestic Products at mar-
ket prices for the most recent four consecutive quarters, and
C is the average of the Nominal Gross Domestic Products at mar-
ket prices for the four consecutive quarters for the comparable
period in the year preceding the year used in calculating B, or
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(ii) until the Minister has published under subsection (9) an amount
for that year determined under subparagraph (i), if the Minister does
so at all, the amount for that subsection for the previous year.
(9) Publication in Canada Gazette — As soon as possible after determin-
ing the amount for any particular year, the Minister shall publish the amount
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in the Canada Gazette.
118
Commentary
This section provides the second “threshold” for ascertaining whether pre-merger notifica-
tion is required and is based on the size of the transaction itself. Each of the subsections
under section 110 requires the acquisition of at least some Canadian assets — sales into Can-
ada alone cannot trigger a notification requirement — although these Canadian assets could
be very small, such as a single sales office. Assuming that the party size threshold is ex-
ceeded, pre-merger notification will normally be required if the target has assets in Canada
in excess of $70 million or if its assets in Canada generate revenues from sales “in or from
Canada” in excess of $70 million (but see subsection 110(4) with respect to amalgamations).
These thresholds are adjusted annually according to a GDP-indexed formula set out in sub-
sections (7) and (8). References in the Act to the $70 million threshold are somewhat mis-
leading as the threshold has changed over time. In 2020, for example, the threshold was $96
million.
Geographically segmented revenue information in financial statements may not provide a
definitive answer to whether section 110 thresholds are exceeded. Segmented information
may allocate revenues by customer location, whereas section 110 requires parties to include
revenues generated by exports from Canadian assets and exclude revenues from imports
from outside Canada (unless a Canadian asset is involved in “generating” those revenues).
Uncertainty can and does arise with respect to the location of assets for the purposes of pre-
merger notification. Section 110 (as well as section 109) refers to “assets in Canada” but
neither the Act nor the Regulations provide guidance as to the meaning of the phrase.
• The location of transportation assets (such as airplanes or ships) is not a settled issue
under section 109 or section 110. On occasion, the Competition Bureau has considered
the jurisdiction of registration or the time the assets spend in Canada as compared with
other jurisdictions. In practice, many mergers in the transportation sector are notifiable
for other reasons (e.g., on the basis of revenues that exceed the relevant thresholds), but
on occasion notification turns on a determination of asset location.
• For the purposes of determining whether intangible property such as shares or IP are
“assets in Canada”, the Bureau has consistently taken the view that the location of
intangible property is the jurisdiction that confers the rights and privileges associated
with the property right. Thus, a patent conferred by U.S. law would be located in the
United States, regardless of the nationality of the owner of the patent. Similarly, the
location of shares of a corporation is the jurisdiction of incorporation of that corpora-
tion, regardless of the nationality of the owner of the corporation or where that corpora-
tion carries on business. Therefore, if the financial statements of a Canadian corpora-
tion include assets that are shares of a foreign corporation (or foreign IP), the value of
those assets may be deducted from the asset value calculation for the purposes of deter-
mining whether the “transaction size” and “party size” notification thresholds are met.
313
The converse is also true: assets on the financial statements of a non-Canadian corpora-
tion that are shares of a Canadian corporation (or that are Canadian IP) will be treated
as assets in Canada. (Note, however, that the Bureau takes the view that cash is located
in the same jurisdiction as the corporation on whose books it appears. That is, it does
not go beyond the audited financial statements to look at the situs of bank accounts.
Note also that sub-paragraph 110(3)(a)(i) specifically excludes “assets that are shares
of any of these corporations” in a context which effectively means only assets that are
shares of non-controlled corporations ought to be included in calculating the transac-
tion-size test.)
The Competition Bureau has issued, in draft form for public consultation, a Pre-Merger No-
tification Interpretation Guideline Number 15: Assets in Canada and Gross Revenues from
Sales in, from or into Canada (Sections 109 and 110 of the Act). See Competition Bureau,
News Release, “Merger Interpretation Guidelines for Consultation” 11 April 2012, which is
available on the Competition Bureau website.
Information about the calculation of assets and gross revenues may be found in the Notifi-
able Transactions Regulations.
under the Competition Act (Ottawa: Competition Bureau, 2010).
Subsection (2)
This subsection applies to asset acquisitions.
Uncertainty occasionally arises with respect to whether a proposed transaction involves the
acquisition of assets. The granting of a licence generally does not constitute the sale of an
asset for the purposes of subsection 110(2). Accordingly, although licensing agreements may
constitute a merger for the purposes of section 92 and may be an agreement between com-
petitors for the purposes of section 90.1, they are not ordinarily subject to pre-merger notifi-
cation obligations. An exception to this rule would be circumstances in which the granting of
a licence is in effect an asset disposition, for example, where the licensor does not retain
residual rights and the licence has a long-term or perpetual duration.
Similarly, the creation of a royalty or lease is not notifiable but its subsequent sale would be
if the usual thresholds are exceeded. An option to purchase assets is not an asset acquisition.
(It could be notifiable if and when the option is exercised, if the usual thresholds are
exceeded.)
For commentary on the treatment of revenues and assets attributable to inter-company trans-
actions, see the commentary to section 4 of the Regulations.
Subsection (3)
This subsection applies to share acquisitions. The shares being acquired must be voting
shares of a corporation that carries on an operating business, where the Canadian assets of
the corporation (or its subsidiaries) exceed $70 million or where the gross revenues from
sales generated from those assets exceed $70 million ($96 million in 2020).
Paragraph 110(3)(b) requires notification where more than 20% or 35% of the voting shares
of a public or private corporation are acquired and again where, if 20% or 35% or more of
the voting shares are already held, an acquisition would result in the buyer owning more than
50% of the voting shares of the target corporation. Once the 50% threshold is crossed, fur-
ther acquisitions may be made without pre-merger notification under the Competition Act.
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The wording of paragraph 110(3)(b) suggests that notification would not be required where a
person acquires exactly 20% or exactly 35% of the voting shares of a corporation. This is
because the subsection only requires notification only if the buyer would own more than
20% or more than 35% of the voting shares.
Subsection 110(3) also refers to a “person or persons” acquiring shares that in the aggregate
carry more than 20%, 35% or 50% of the votes attached to all outstanding voting shares.
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This is meant to capture circumstances in which two or more persons propose to jointly
acquire and own shares — that is, a situation in which each share would be jointly owned,
and not a situation in which numerous parties separately acquire shares which, if aggregated,
would result in the acquisition of more than 20%, 35% or 50% of the voting shares of a
corporation. Thus, if Company A and Company B were to each acquire 15% of the voting
shares of Public Company C pursuant to a single purchase agreement, notification would not
be required, even though 30% of the voting shares would be held in the aggregate. Similarly,
if Company A proposes to acquire 40% of the voting shares of Company C and Company B
proposes to acquire 5% concurrently or as part of the same transaction, only Company A and
Company C (as the target) will have notification obligations.
This subsection establishes that the only acquisitions of securities that could be subject to a
pre-merger notification requirement are acquisitions of voting shares; acquisitions of non-
voting shares, bonds, warrants and other securities cannot trigger a notification requirement.
The reference to ownership of voting shares likely includes beneficial as well as legal owner-
ship. This is because legal title may carry no rights whereas beneficial (or equitable) owner-
ship confers the rights which are normally associated with ownership. Where beneficial
ownership and legal ownership are held by different persons, notification will therefore turn
on whether the proposed transaction will result in a beneficial owner of voting shares ex-
ceeding the 20%, 35% or 50% thresholds. Thus, in determining whether a person “owns”
voting shares for the purposes of subsection 110(3), merger parties should assess who enjoys
the benefits of ownership and not merely who has legal title. In the United States, under the
Hart-Scott-Rodino Act, the existence of beneficial ownership is determined on an case-by-
case basis and includes consideration of who bears the risk of loss, who has the benefit of
gain, who has the right to vote the shares being acquired and who has the ability to control
the investment and dispose of the shares. The right to vote is generally the most important
factor, but when the person that has the right to vote has no economic interest in the shares,
the right to vote does not control the outcome.
Pre-Merger Notification Interpretation Guideline Number 9: Shareholder Agreements is
consistent with this interpretation of subsection 110(3) in that it provides that the Bureau will
focus on rights acquired through ownership and not rights acquired through other means,
such as contract.
The words and phrases “operating business”, “person”, “prescribed” and “voting share” are
defined in section 108. Further guidance as to the meaning of the phrase “operating busi-
ness” may be found the Competition Bureau’s Pre-Merger Notification Interpretation
Guideline Number 1: Definition of “Operating Business” (section 108 of the Act). Further
guidance as to the meaning of the phrase “voting shares” may be found the Competition
Bureau’s Pre-Merger Notification Interpretation Guideline Number 5: Acquisitions of Non-
Voting Shares and Convertible Securities (subsection 110(3) of the Act).
Subsections (4), (4.1)

There is no definition of amalgamation in the Competition Act. The wording of subsection
110(4) and 110(4.1) of the Act extend to the amalgamation of two or more entities (not just
315
corporations), even though this is a concept rooted in corporate statutes. Section 181 of the
Canada Business Corporations Act, R.S.C. 1985, c. C-44, as amended, provides that “[t]wo
or more corporations, including holding and subsidiary corporations, may amalgamate and
continue as one corporation.” Sections 181-186.1 of that Act provide the requisite proce-
dures for amalgamations. In essence, amalgamation refers to the union of two or more corpo-
rations under a statutory procedure whereby they become one corporation only. Subsections
110(4) and (4.1) would be applicable whether the amalgamation occurred under the corpo-
rate statutes of Canada or a province or of a foreign jurisdiction, provided that the corporate
law provision in that foreign jurisdiction was substantially the same as an amalgamation in
Canadian law.
See also the Competition Bureau’s Pre-Merger Notification Interpretation Guideline Num-
ber 6: Amalgamation (subsections 110(4) and 110(4.1) of the Act). But note that that Guide-
line has not been updated to reflect (i) the current test for pre-merger notification with re-
spect to amalgamations and (ii) that amalgamations extend to all entities (and not just
corporations).
The threshold for pre-merger notification in connection with amalgamations is unique inso-
far as it contains a special secondary “size of the parties” threshold. In summary, pre-merger
notification is required in respect of a proposed amalgamation of two or more entities where
at least one of those entities directly or indirectly carries on an operating business in Canada
where each of the following three thresholds are satisfied:
(1) The “size-of-the-parties” threshold in subsection 109(1) requires that the parties to the
transaction, together with their affiliates, have assets in Canada, or annual gross reve-
nue from sales in, from or into Canada, which exceed $400 million in the aggregate.
(2) The “size-of-the-transaction” threshold in subsection 110(4) requires that the aggregate
value of assets in Canada owned by the continuing entity (or by entities it will control)
exceeds $70 million or the annual gross revenue from sales in or from Canada gener-
ated by those Canadian assets exceeds $70 million ($96 million in 2020).
(3) The “parties-to-the-amalgamation” threshold in subsection 110(4.1) requires that each
of at least two of the amalgamating entities, together with their affiliates, have assets in
Canada, or annual gross revenue from sales in, from or into Canada, which exceed $70
million ($96 million in 2020).
Subsection (5)
The word “combination” is not defined in the Act, but would include non-corporate entities
such as partnerships and trusts. See also subs. 110(6) and ss. 95 and 112 and related
commentaries.
Subsection (6)
This subsection covers a proposed acquisition of an interest in a combination that carries on
an operating business otherwise than through a corporation. For the proposed acquisition to
be notifiable, the following two conditions must be satisfied: (1) the aggregate value of the
assets in Canada of the combination, or the annual gross revenues from sales in or from
Canada generated from those assets, must exceed $70 million ($96 million in 2020); and (2)
where the acquiring party would be acquiring an interest that would entitle it to receive more
than 35% of the profits or of the assets on dissolution.
The word “combination” is not defined in the Act, but would include non-corporate entities
such as partnerships and trusts. See also subs. 110(5) and ss. 95 and 112.
316
Unlike subsections 110(3) and (4), which require parties to include the assets and revenues
of the target as well as assets and revenues of entities controlled by the target in assessing
whether the threshold is satisfied, subsection 110(6), as well as subsection 110(5), only re-
quires parties to consider the assets and revenues that are the “subject-matter” of the combi-
nation. This suggests that the assets and revenues of entities controlled by the combination
do not need to be included in determining whether pre-merger notification is required. In
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some cases, the assets and revenues of controlled entities will be included in the consolidated
financial statements of the combination (e.g., the trust or partnership the units of which are
being acquired) so the distinction would be immaterial.
Subsection 110(6) also requires that the acquisition of an interest be “in a combination that
carries on an operating business”, which suggests that the combination itself must carry on
an operating business. In contrast, subsections 110(3) and (4) clearly contemplate the acqui-
sition or amalgamation of holding companies that control corporations that carry on operat-
ing businesses. However, the Competition Bureau takes a broad interpretation of the term
operating business which in practice may effectively eliminate the technical differences be-
tween subsections 110(3) and (4) and subsection 110(6). In its Pre-Merger Notification In-
terpretation Guideline Number 1: Definition of “Operating Business” (section 108 of the
Act) the Bureau states that: “[a] company that is engaged in the business of holding invest-
ments, whether passive or otherwise, may be an operating business.”
Thus, where there is a proposed acquisition of an interest in a combination, the trust or part-
nership the units of which are being acquired must itself exceed the relevant financial thresh-
olds and must itself carry on an operating business. The assets, revenues and activities of its
subsidiaries are irrelevant to the analysis.
Subsection (8)
Subsection 110(8) sets out the mechanisms whereby the target-size thresholds in subsection
110(1) to 110(6) may be increased or decreased.
Paragraph 110(8)(a) provides that the threshold may be changed to any amount by
regulation.
Paragraph 110(8)(b) sets out a formula for annual revisions to the threshold. It requires that,
every January, the minister divide Current Nominal GDP for the previous year by that of the
year before the previous year. That gives the Minister a figure which is multiplied by the
previous threshold. If the GDP for the previous year is higher than the year before the previ-
ous year, the multiplier should be more than 1 and result in an increase in the threshold. If
the multiplier is less then 1, the threshold should fall.
Subparagraph 110(8)(b)(ii) provides that the new threshold is effective once published in the
Canada Gazette. It is not retroactive to the beginning of the calendar year or other point in
time. Note that this subparagraph permits the Minister to not adjust the threshold. In such a
case, and assuming that there is no threshold change implemented by regulation, the thresh-
old would remain the same as it was in the previous year. This occurred in 2010, when the
application of the paragraph 110(8)(b) formula would have resulted in a decrease to the
threshold.
Given the administrative burden of amending the threshold by regulation, year-over-year
threshold changes will not normally be implemented pursuant to paragraph 110(8)(a). Para-
graph 110(8)(a) was designed to permit the Competition Bureau to implement a significant
increase or decrease to the target-size notification threshold if it believed that the current
threshold was materially under- or over-inclusive.
317
Subsection (9)
Subsection 110(9) provides that the Minister shall publish the new threshold as soon as pos-
sible after it is determined, and subsection 110(8) requires that the threshold be determined
every January. The formula in subsection 110(8) is substantially similar to the formula used
under the Investment Canada Act. Annual adjustments to the Investment Canada Act thresh-
olds tend to be published in the Canada Gazette in late January or early February.
Exemptions
Acquisition of Voting Shares, Assets or Interests
111. Acquisitions — The following classes of transactions are exempt from

the application of this Part:
(a) an acquisition of real property or goods in the ordinary course of busi-
ness if the person or persons who propose to acquire the assets would not,
as a result of the acquisition, hold all or substantially all of the assets of a
business or of an operating segment of a business;
(b) an acquisition of voting shares or of an interest in a combination solely
for the purpose of underwriting the shares or the interest, within the
meaning of subsection 5(2);
(c) an acquisition of voting shares, an interest in a combination or assets
that would result from a gift, intestate succession or testamentary
disposition;
(d) an acquisition of collateral or receivables, or an acquisition resulting
from a foreclosure or default or forming part of a debt work-out, made
by a creditor in or pursuant to a credit transaction entered into in good
faith in the ordinary course of business;
(e) an acquisition of a Canadian resource property, as defined in subsec-
tion 66(15) of the Income Tax Act, pursuant to an agreement in writing
that provides for the transfer of that property to the person or persons
acquiring the property only if the person or persons acquiring the pro-
perty incur expenses to carry out exploration or development activities
with respect to the property; and
(f) an acquisition of equity interests in an entity under an agreement in
writing that provides for the creation of those equity interests only if the
person or persons acquiring them incur expenses to carry out exploration
or development activities with respect to a “Canadian resource property”,
as defined in subsection 66(15) of the Income Tax Act, in respect of which
the entity has the right to carry out those activities, if the entity does not
have any significant assets other than that property.
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318
Commentary
Paragraph (a)
This exemption was enacted for the benefit of large purchasers who buy real or personal
property for use in their ordinary business operations. Because of the nature of the exemp-
tion the purchase must be “in the ordinary course of business”. To make abundantly clear
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that the exemption applies only to purchases to be used in the course of business operations
and not purchases “of” business operations, the exemption is qualified so that it does not
apply if the acquisition would result in a holding of substantially all the assets of a business
or an operating segment thereof.
On the other hand, real property used to generate rental income, such as commercial, retail or
industrial properties, are typically considered by the Competition Bureau to be productive
capacity and not property acquired in the “ordinary course of business”. Further information
on the Competition Bureau’s interpretation of paragraph 111(a) may be found in the Compe-
tition Bureau’s Pre-Merger Notification Interpretation Guideline No. 3: Exemptions for Ac-
quisitions in the Ordinary Course of Business (Paragraph 111(a) of the Act).
In the Competition Bureau’s Pre-Merger Notification Interpretation Guideline No. 16: Defi-
nition of “Goods” (Paragraph 111(a) of the Act), the Bureau confirms that it considers fi-
nancial instruments, such as mortgages and other loans, to be “goods” and is prepared to
treat acquisitions of mortgage loan portfolios as exempt from merger notification. Accord-
ingly, acquisitions of mortgage loan portfolios will be exempt from merger notification
where a financial institution buys loan portfolios from time to time without acquiring the
vendor’s staff, offices, equipment, etc.
Paragraph (d)
This exemption reflects a similarly-worded exemption in United States antitrust law, specifi-
cally HSR Rule 802.63(a). The Competition Bureau has issued an interpretation guideline for
paragraph 111(d) (Pre-Merger Notification Interpretation Guideline Number 7: Credit Ac-
quisitions) and there is a separate interpretation guideline covering acquisitions made in the
“ordinary course of business.”
A question that often arises relates to the fact that defaults or debt work-outs are unusual
events and not “ordinary course.” In the author’s view, the “ordinary course” reference re-
lates to the original credit transaction, not the default or debt work-out.
The Bureau’s position as articulated in its interpretation guideline is that there must be a
good faith credit transaction. A “creditor” who buys debt when it is clear there will be a
default or work-out in the future may not qualify under the exemption on the theory that that
is not a good faith credit transaction, but a transaction intended to acquire the underlying
assets.
For example, paragraph 111(d) would apply to the following fact pattern to exempt Com-
pany A’s acquisition of Company B’s assets:
• Company A lends money to third parties from time-to-time.
• Company A lent money to Company B, secured on Company B’s assets.
• Company B defaulted on its loans.
• Company A successfully applied to put Company B into receivership.
• Company B’s assets are to be sold through the receivership.
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• Company A acquires Company B’s assets through the receivership sale.
Paragraphs (e), (f)

These exemptions refer to agreements common in resource industries whereby compensation
to the “active” party constitutes assets if the venture is not an entity or equity interests in the
venture if the venture is an entity. Because the venture, whether incorporated or not, will
often have a “passive” party well over the $400 million first threshold and because the com-
pensation to the active exploring or developing party will often exceed the second threshold
of $70 million ($96 million in 2020), and because these agreements are so common in the
resource sector with little chance of competition policy implications, pre-merger notification
was not thought necessary.
Combinations
112. Combinations that are joint ventures — A combination is exempt
from the application of this Part if
(a) all the persons who propose to form the combination are parties to an
agreement in writing or intended to be put in writing that imposes on one
or more of them an obligation to contribute assets and governs a continu-
ing relationship between those parties;
(b) no change in control over any party to the combination would result
from the combination; and
(c) the agreement referred to in paragraph (a) restricts the range of activ-
ities that may be carried on pursuant to the combination, and contains
provisions that would allow for its orderly termination.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
Commentary
Section 112 exempts joint ventures (as defined) from pre-merger notification. It is the proce-
dural corollary to the substantive exemption in section 95, pursuant to which joint ventures
are exempted from Tribunal orders under section 92. Both section 112 and section 95 only
apply to non-corporate joint ventures as specifically defined and, in practice, it is rare for an
otherwise notifiable joint venture to satisfy the conditions of section 112. (Most frequently
because joint ventures are usually formed through the creation of a corporation and subject
to notification under subsection 110(2)).
Although section 112 is not specifically limited to “non-corporate” combinations, section 95
and subsections 110(5) and (6) describe combinations as non-corporate entities. The Compe-
tition Bureau takes the view that use of the word “combination” in section 112 was also
intended to exempt only non-corporate combinations from the pre-merger notification obli-
gation, although it would have been preferable if section 112 was expressly limited to non-
corporate combinations.
Further information on the Competition Bureau’s interpretation of section 112 may be found
in the Competition Bureau’s Pre-Merger Notification Interpretation Guideline Number 4:
Exemption for Combinations that are Joint Ventures (section 112 of the Act).
320
General
113. General exemptions — The following classes of transactions are ex-
empt from the application of this Part:
(a) a transaction all the parties to which are affiliates of each other;
Act
(a.1) a transaction in respect of which the Minister of Finance has certi-
fied to the Commissioner under paragraph 94(b) that it is, or would be, in
the public interest;
(b) a transaction in respect of which the Commissioner has issued a certif-
icate under section 102;
(c) a transaction in respect of which the Commissioner or a person au-
thorized by the Commissioner has waived the obligation under this Part
to notify the Commissioner and supply information because substantially
similar information was previously supplied in relation to a request for a
certificate under section 102; and
(d) such other classes of transactions as may be prescribed.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1991, c. 45, s. 550; 1991, c. 46, s. 594; 1991, c.
47, s. 717; 1999, c. 2, ss. 30, 37(z.14); 2001, c. 9, s. 580
Commentary
Paragraph (a)
The reason for exempting parties which are affiliates is that there is no harm to competition
since they are of the same economic family in any event. See subsections 2(2), (3), (4) and
108(2) and commentary thereto for the definition of affiliates.
Note that under the definition of affiliated parties in the above sections a provincial Crown
corporation and a federal Crown corporation would not be affiliated parties. Hence a merger
between such entities would not be exempt from pre-merger notification under section 113.
Pursuant to subsection 109(2), the parties to an acquisition of shares are the purchaser and
the target. This likely means that only these parties must be affiliated for a merger transac-
tion to benefit from the exemption in paragraph 113(b), and not necessarily all of the parties
to a merger agreement. For example, suppose Company A has two subsidiaries, Company B
(100% owned) and Company C (75% owned by Company A and 25% owned by the third
party Company D). If Company B proposed to acquire all the outstanding voting shares of
Company C from Company A and the third party Company D, paragraph 113(a) would
likely apply to exempt the transaction from any pre-merger notification requirement. That is
because although the non-affiliated Company D would be a party to the purchase and sale
agreement, it would not be a party to the proposed transaction pursuant to subsection 109(2).
Only Company B and C are parties to the transaction for the purposes of Part IX, and they
would be considered affiliates pursuant to subsection 2(2).
This exemption was added to the Competition Act in 2001. The Minister of Finance has
never issued a certificate under s. 94(b) and, therefore, this exemption has never applied to
exempt a transaction from Part IX of the Act.
321
Paragraph (b)
Section 102 provides for Advance Ruling Certificates in certain circumstances. See the
Commentary to section 102. In practice the exemptions in paragraphs 113(b) and (c) may
apply in unusual circumstances. For example, if an ARC or no-action letter was issued in
connection with a proposed but uncompleted transaction, these paragraphs may permanently
exempt that transaction from the notification obligations in Part IX, even if completion were
to occur years after the ARC or no-action letter was issued. (Section 103 provides that the
Commissioner cannot challenge a transaction within one year of completion, but that provi-
sion operates independently of paragraph 113(b). In other words, after one year the ARC
may no longer insulate a merger from challenge by the Commissioner, but paragraph 113(b)
would nevertheless relieve the parties of their notification obligation.) Similarly, it may also
be possible to conclude that the exemption applies in certain re-acquisition situations. For
example, if Party A acquires 20 percent of the voting shares of Party B, subsequently dis-
poses of that interest and later seeks to re-acquire that interest, the initial clearance may
exempt the subsequent acquisition because the acquisition by Party A of more than 20 per-
cent of the voting shares of Party B is a transaction in respect of which the Commissioner
has issued an ARC (or no action letter). The issue in such circumstances may be whether the
later acquisition can properly be characterized as the same “proposed transaction” to which
the ARC or no-action letter was issued. Regardless, the Commissioner would still have sub-
stantive jurisdiction over the proposed transaction pursuant to s. 92.
Paragraph (c)
Where information supplied with an Advance Ruling Certificate (ARC) request is substan-
tially similar to the information which would be required under section 114, the Commis-
sioner may, pursuant to paragraph 113(c), waive the requirement to file a notice and supply
information under section 114. Accordingly, the Competition Bureau suggests that where the
possibility exists that an ARC made in relation to a notifiable transaction could be rejected,
the ARC request should contain the prescribed information in order to potentially bypass the
notification process and its waiting periods. The Commissioner is likely to waive notification
where the examination of the proposed transaction has been completed and additional infor-
mation is not required. Although a para. 113(c) waiver can simply waive the filing require-
ment, in practice it takes the form of a no-action letter, confirming also that the Bureau is
closing its file and it does not presently intend to take further enforcement action.
Paragraph (d)
Asset securitization transactions have been exempted by regulation.

114. (1) Notice of proposed transaction — Subject to this Part, the par-
ties to a proposed transaction shall, before the transaction is completed, notify
the Commissioner that the transaction is proposed and supply the Commis-
sioner with the prescribed information in accordance with this Part, if
(a) a person, or two or more persons pursuant to an agreement or ar-
rangement, propose to acquire assets in the circumstances set out in sub-
section 110(2), to acquire shares in the circumstances set out in subsection
322
110(3) or to acquire an interest in a combination in the circumstances set

out in subsection 110(6);
(b) two or more entities propose to amalgamate in the circumstances set
out in subsection 110(4); or
(c) two or more persons propose to form a combination in the circum-
Act
stances set out in subsection 110(5).
(2) Additional information — The Commissioner or a person authorized
by the Commissioner may, within 30 days after receiving the prescribed infor-
mation, send a notice to the person who supplied the information requiring
them to supply additional information that is relevant to the Commissioner’s
assessment of the proposed transaction.
(2.1) Contents of notice — The notice shall specify the particular addi-
tional information or classes of additional information that are to be supplied.
(3) Entity whose equity interests are acquired — If a proposed trans-
action is an acquisition of equity interests in an entity and the Commissioner
receives prescribed information supplied under subsection (1) by a party to
the transaction, other than the entity, the Commissioner shall, if he or she has
not already received the prescribed information from the entity, immediately
notify the entity that the Commissioner has received the prescribed informa-
tion from that party and the entity shall supply the Commissioner with the
prescribed information within 10 days after being so notified.
(4) Notice and information — Any of the persons required to give notice
and supply information under this section may
(a) if duly authorized to do so, give notice or supply information on behalf
of and in lieu of any of the others who are so required in respect of the
same transaction; or
(b) give notice or supply information jointly with any of those others.
120
Commentary
This is the section that establishes the pre-merger notification filing obligation. The refer-
ences to section 110 are to the proposed transactions described in that section. Since section
114 is “subject to this Part”, notification is required only for those transactions in respect of
which the $400 million size-of-parties threshold is met pursuant to section 109. The exemp-
tions in sections 111, 112 and 113 are also incorporated by reference through that phrase.
It is the “parties to the proposed transaction” who are required to give notification. Under
subsection 114(4), each party may separately notify the Commissioner of Competition or
they may do so jointly or on behalf of another party. In practice, each merger party normally
submits its own portion of the filing form but (in consensual transactions) following co-
ordination with the other parties, usually through their outside lawyers. Notification filings
are also normally accompanied by a submission that provides an assessment of the competi-
tive impact of the proposed transaction. This is typically prepared by the lawyer for the
323
buyer with the co-operation and assistance of the vendor’s counsel. The Competition Bureau
Fees and Service Standards Handbook for Mergers and Merger-Related Matters (Ottawa:
Competition Bureau, 2010) sets out the information the Bureau generally expects to receive
in connection with merger notification filings in order to be able to complete its review of
the proposed transaction. (The Handbook makes it clear that the Bureau typically will re-
quire much more information than called for by the filing form.)
Under the Canada Transportation Act, parties to a proposed transaction subject to notifica-
tion under this section must also give notice to the Minister of Transport if the proposed
transaction involves a federal transportation undertaking. There is some uncertainty as to the
scope of the Canada Transportation Act in these circumstances. The Act does not define
“transportation undertaking.” The reference to a proposed transaction that “involves” a trans-
portation undertaking means that transactions between parties that operate transportation un-
dertakings could be caught, even if the transaction does not involve the acquisition of a
transportation undertaking. That was almost certainly not the intention of Parliament, but the
legislation is ambiguous. Where notice is required or advisable, that notice should include
(1) the information that is either required to be provided to the Commissioner or that is filed
with the Commissioner; and (2) a Public Interest Impact Assessment containing information
with respect to the public interest as it relates to national transportation. Additional informa-
tion on the notification and review of mergers involving federal transportation undertakings
under the Canada Transportation Act may be found in the draft Guidelines for Mergers &
Acquisitions involving Transportation Undertakings (Ottawa: Transport Canada, June 2008).
Where the Minister of Transport is of the opinion that a proposed transaction raises issues
with respect to the public interest as it relates to national transportation, the Minister may
direct the Canadian Transportation Agency to examine those issues or appoint and direct any
person to examine those issues under the Canada Transportation Act and inform the Com-
missioner that a public interest review has been initiated and a report on competition con-
cerns is required. The Commissioner shall within 150 days after the Commissioner is noti-
fied of the proposed transaction, or within any longer period that the Minister may allow,
report to the Minister of Transport and the parties to the transaction on any concerns regard-
ing the potential prevention or lessening of competition that may occur as a result of the
transaction.
Subsection 114(2) permits the Commissioner to issue a supplemental information request
(“SIR”) to a party that has submitted a pre-merger notification filing under subsection
114(1). Where an SIR is issued, section 123.1 provides that the merger parties cannot com-
plete their transaction until 30 days following compliance with the request. Nothing in the
Act prevents the Commissioner from seeking section 11 orders against merging parties, even
where an SIR is issued. In the 2019 Kraft Heinz Canada/Parmalat transaction, for example,
the Bureau obtained a paragraph 11(1)(a) order requiring executives of the merging parties
to be interviewed under oath by Bureau investigators, in addition to issuing a SIR. The Bu-
reau did not challenge the transaction and issued a no-action letter. See Competition Bureau
will not oppose Kraft sale of natural cheese business to Parmalat (Ottawa: Competition Bu-
reau, 2019).
The Bureau usually receives more than 200 merger filings per year. Approximately 70% are
designated non-complex with an average review time of approximately 10 days and approxi-
mately 30% are designated complex with an average review time of approximately 50 days.
The Bureau typically issues between 10–20 SIRs per year, which usually take parties 50 to
80 days to respond to and 100 to 150 days to resolve.
A considerable volume of jurisprudence has upheld the constitutionality of demands for bus-
iness records in circumstances where there is no risk of criminal liability. However, one
324
commentator has observed that the absence of judicial control over the SIR process and the
scope of the Commissioner’s powers to demand information and documents creates at least a
“discordance” between s. 114(2) and s. 8 of the Charter. See: Joshua A. Krane, SIRches and
Seizures: Are Supplementary Information Requests Unconstitutional? (2011), 51 Canadian
Business Law Journal at pp. 232ff.
There need not be total compliance with a SIR under the Act. Section 116 provides that
Act
parties may exclude information that is: not known or reasonably obtainable (subsection
116(1)); privileged (subsection 116(1)); not relevant to the substantive assessment of the
transaction (subsection 116(2)); or has been previously provided to the Bureau (subsection
116 (2.1)). Section 118 requires that responses be certified as “complete and correct in all
material respects” thus non-material exclusions should not undermine the validity of a re-
sponse. In practice the recipients of many SIRs do not fully respond to the original request
either because the Bureau has concluded that a smaller amount of information is sufficient
for its assessment or because problematic merger transactions have been resolved on consent
before the SIR response has been certified complete.
Subsection 114(3) was originally added to Part IX by the 1999 amendments to ensure that
information required from the target of a hostile bid is submitted sufficiently in advance of
the expiration of the waiting period. Under subsection 114(3), the target of an equity interest
acquisition is required to provide information within 10 days of receiving notice from the
Commissioner.
As an alternative to relying on subsection 114(3), it may be possible for a bidder to comply
with Part IX by requesting an Advance Ruling Certificate, which could result in the possible
strategic advantage of not requiring the target to notify. Alternatively, it may submit a notifi-
cation on behalf of both parties, an option which seems to be contemplated by paragraph
114(4)(b), and rely on subsection 116(1) to the extent that information about the target is not
reasonably obtainable. The Competition Bureau for its part could presumably use section 11
to obtain the customer, supplier and additional information from the target that it might need
to complete its review of the proposed transaction.
An interesting jurisdictional issue may arise in connection with the proposed acquisition of
voting shares of a non-Canadian corporation. Even where notification thresholds are met
(e.g., as a result of the assets or revenues of a Canadian affiliate), the foreign target may not
itself have a real and substantial connection to Canada such that the Competition Tribunal or
Canadian Courts would have jurisdiction over that foreign corporation. It is not clear
whether the Commissioner has the authority to request that that foreign corporation submit a
notification filing or whether failure to comply with such a request would constitute an of-
fence under subsection 65(2). (Subsection 109(2) stipulates that the parties to a proposed
acquisition of shares are the person or persons who propose to acquire the shares and the
corporation the shares of which are to be acquired. Thus, where a foreign corporation is the
target of a hostile transaction it is that foreign corporation, and not any Canadian affiliate,
that would have the notification obligation.)
The Bureau also takes the view that subsection 114(3) applies to SIRs and that, therefore, the
30 day period in which the Commissioner may issue an SIR to the target of a hostile bid
starts with the submission of the target’s portion of the pre-merger notification form and not
30 days from the date that the bidder submitted its form.
For a further discussion of section 114 see the Procedures Guide for Notifiable Transactions
and Advance Ruling Certificates under the Competition Act (Ottawa: Competition Bureau,
2010) as well as the Competition Bureau’s Pre-Merger Notification Interpretation Guideline
Number 2: Number of Notices — Multiple Step or Continuous Transactions (section 114 of
325
the Act). See also Hostile Transactions Interpretation Guideline Number 1: Bureau Policy
on Disclosure of Information.
See David Rosner, Canadian Competition Law Reform: A Diagnosis and Proposals for Re-
form of Canada’s Ineffective Merger Notification Rules (Boston: Competition Policy Inter-
national, February 2018) for a discussion of ideas for reforming Canadian merger notifica-
tion rules.
Subsection 65(2) makes failure to comply with subsection 114(1) a criminal offence. Section
123.1 permits the Tribunal or a court to impose an administrative monetary penalty or other
remedy on parties that complete transactions without waiting for the expiry of the waiting
periods associated with the submission of pre-merger notification filings and responding to
supplemental information requests. In addition, failure to notify where required will entitle
the Commissioner to a preliminary injunction under s. 100, which would normally have ef-
fect until notification actually occurred. See the commentary to s. 100.
115. (1) Prior notice of acquisitions — It is not necessary to comply with

section 114 in respect of a proposed acquisition of voting shares or of an inter-
est in a combination where a limit set out in subsection 110(3) or (6) would be
exceeded as a result of the proposed acquisition within three years immedi-
ately following a previous compliance with section 114 required in relation to
the same limit.
(2) Notice of future acquisition — Where a person or persons who pro-
pose to acquire voting shares or an interest in a combination are required to
comply with section 114 because the twenty or thirty-five per cent limit set out
in subsection 110(3) or the thirty-five per cent limit set out in subsection 110(6)
would be exceeded as a result of the acquisition, the person or persons may, at
the time of the compliance, give notice to the Commissioner of a proposed fur-
ther acquisition of voting shares or of an interest in a combination that would
result in a fifty per cent limit set out in that subsection being exceeded, and
supply the Commissioner with a detailed description in writing of the steps to
be carried out in the further acquisition.
(3) Exemption for further acquisitions of voting shares — It is not
necessary to comply with section 114 in respect of a proposed further acquisi-
tion referred to in subsection (2) if
(a) notice of the further acquisition is given to the Commissioner under
subsection (2) and it is carried out in accordance with the description sup-
plied under that subsection; and
(b) an additional notice of the further acquisition is given to the Commis-
sioner in writing within twenty-one, and at least seven, days before the
further acquisition.
(4) Limitation — Subsection (3) does not apply in respect of a further acqui-
sition unless the further acquisition is completed within one year after notice
of it is given under subsection (2).
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, ss. 32, 37(z.15)
326
Part IX — Notifiable Transactions (ss. 108–124) S. 116(1)
Commentary
The basic duration of a notification pursuant to section 114 is established by section 119 as
one year. If the proposed transaction is not completed within one year (or longer if the Com-
missioner so specifies), then new notification is required if the parties wish to proceed with
the transaction. Section 115 provides exceptions to this basic s. 119 rule.
Act
Subsection (1)
Subsections 110(3) and 110(6) establish thresholds for notification based on the percentage
of shares or ownership interests proposed to be acquired. Subsection 115(1) probably refers
to situations where notice is given and the threshold is exceeded, then ownership of shares
falls below that threshold, and then it is again proposed to exceed the limit. In other words,
the three year duration period is intended to apply to circumstances where the limit referred
to in ss. 110(3) or 110(6) is attained and lost on a fluctuating basis. This could occur where
shares are bought and sold on the open market with the consequence that, for example, a 20
per cent limit is attained and lost frequently. It would be greatly inconvenient for the firm to
give notice each time it seeks to attain 20 per cent of the shares from a pre-20 per cent
ownership situation.
It should be noted that, as s. 115(1) literally reads, the three year duration for notifications
applies to notifications given where the limit is not exceeded at all over a one year period.
For example, notice is given, and no merger is about to take effect until, for example, 21/2
years after original notification. Literally, according to s. 115(1), no new notification is re-
quired. This would leave the one-year period referred to in s. 119 applying only to asset
acquisitions, amalgamations and combinations. However, this interpretation is so in conflict
with the basic one year duration for notifications set forth in s. 119 that s. 115(1) will proba-
bly be interpreted as requiring an initial exceeding of the limit.
Subsections (2), (3)

The combined effect of these two subsections is to provide for a procedure whereby notifica-
tion can be given of a proposal to acquire control of a corporation in stages. If the first
threshold is reached, no additional formal notification is required for the proposal to surpass
the 50 per cent threshold. All that is required is that a detailed description in respect of the
second stage acquisition be given at the time of notification to attain the first threshold, and
that the Commissioner be informed of the further acquisition when it occurs.
For this procedure to apply, the second acquisition must be completed within a year of origi-
nal formal notification. If the first threshold is attained and 50 per cent ownership is not
acquired within one year of original notification, then new formal notification must be given
if 50 per cent ownership is still proposed to be acquired.
116. (1) If information cannot be supplied — If any of the information

required under section 114 is not known or reasonably obtainable, or cannot
be supplied because of the privilege that exists in respect of lawyers and nota-
ries and their clients or because of a confidentiality requirement established by
law, the entity or individual who is supplying the information may, instead of
supplying the information, inform the Commissioner under oath or solemn af-
firmation of the matters in respect of which information has not been supplied
and the reason why it has not been supplied.
327
(2) If information not relevant — If any of the information required

under section 114 could not, on any reasonable basis, be considered to be rele-
vant to an assessment by the Commissioner as to whether the proposed trans-
action would or would be likely to prevent or lessen competition substantially,
the entity or individual who is supplying the information may, instead of sup-
plying the information, inform the Commissioner under oath or solemn affir-
mation of the matters in respect of which information has not been supplied
and why the information was not considered relevant.
(2.1) If information previously supplied — If any of the information re-
quired under section 114 has previously been supplied to the Commissioner,
the entity or individual who is supplying the information may, instead of sup-
plying it, inform the Commissioner under oath or solemn affirmation of the
matters in respect of which information has previously been supplied and
when it was supplied.
(3) Commissioner may require information — If an entity or indivi-
dual chooses not to supply the Commissioner with information required under
section 114 and so informs the Commissioner in accordance with subsection
(2) or (2.1) and the Commissioner or a person authorized by the Commis-
sioner notifies that entity or individual, within seven days after the Commis-
sioner is so informed, that the information is required, the entity or individual
shall supply the Commissioner with the information.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, ss. 33, 37(z.16); 2009, c. 2, s. 438;
2018, c. 8, s. 121
Commentary
Section 116 allows merger parties to not supply four types of information in a pre-merger
notification filing or in response to a supplemental information request:
• Information that is not known or reasonably obtainable (subsection 116(1)).
• Information that is privileged (subsection 116(1)).
• Information that is not relevant to the competition assessment of the transaction (sub-
section 116(2)). This is most commonly information about non-overlapping affiliates
or products and detailed information about operations exclusively outside Canada.
• Information that has been previously provided to the Competition Bureau and has not
changed, for example, if a party recently submitted a merger filing in connection with
another transaction and all of the information is still valid (subsection 116(2.1)).
Where the information is not supplied because it is not relevant or has been previously sup-
plied to the Bureau, subsection 116(3) authorises the Commissioner of Competition to re-
quire that the information be supplied.
Where information is not supplied under subsections 116(1) and 116(2), the merger party
must provide an explanation as to why the information is not being supplied.
Although parties withholding information on the basis that it is privileged must explain why
it is not being provided, s. 116 does not require the submission of “privilege logs.” In the
US, privilege logs must be provided where parties withhold information from a pre-merger
notification filing or second request on the basis of privilege. The log must contain, for each
328
Part IX — Notifiable Transactions (ss. 108–124) S. 117(3)
document, a statement of the claim of privilege and the facts relied on to support the claim,
including the identity of the document, its author, addressee, date, subject matter, parties
who received copies, its present location, and who has control of it. In Canada, detailed
information of this sort would serve no useful purpose because there is no procedural mecha-
nism for challenging a subs. 116(1) privilege claim, as there is for ss. 11, 15 and 16 in s. 19.
The s. 118 certificate should provide the Bureau with some comfort about the adequacy of
Act
privilege claims because the person certifying the filing or supplemental information request
must be comfortable that it is “correct and complete in all material respects,” including with
respect to matters of privilege. However, there is no obvious policy rationale for permitting
third party assessments of privilege claims for information produced pursuant to ss. 11, 15
and 16 and not subs. 116(1). It may be that this gap is filled in a future amendment to the
Act.
Section 116, particularly subsection 116(2), is as a practical matter critically important to the
efficient functioning of the merger notification and review system because it gives parties
the flexibly to craft notification filings and respond to information requests in a manner that
excludes information that would be expensive and time-consuming to obtain and of little or
no relevance to the substantive assessment of the proposed transaction.
117. (1) Saving — Nothing in section 114 requires

(a) any individual who is a director of a corporation to supply informa-
tion that is known to that individual by virtue only of their position as a
director of an affiliate of the corporation that is neither a wholly-owned
affiliate nor a wholly-owning affiliate of the corporation; or
(b) any individual who, in respect of an entity other than a corporation,
serves in a capacity similar to that of a director to supply information that
is known to that individual by virtue only of their serving in that capacity
with respect to an affiliate of the entity that is neither a wholly-owned
affiliate nor a wholly-owning affiliate of the entity.
(2) Wholly-owned affiliate — For the purposes of subsection (1), one cor-
poration is the wholly-owned affiliate of another corporation if all its outstand-
ing voting shares, other than shares necessary to qualify persons as directors,
are beneficially owned by that other corporation directly, or indirectly
through one or more affiliates where all the outstanding voting shares of the
affiliates, other than shares necessary to qualify persons as directors, are bene-
ficially owned by that other corporation or each other.
(3) Wholly-owning affiliate — For the purposes of subsection (1), one cor-
poration is the wholly-owning affiliate of another corporation if it beneficially
owns all the outstanding voting shares of that other corporation, other than
shares necessary to qualify persons as directors, directly, or indirectly through
one or more affiliates where all the outstanding voting shares of the affiliates,
other than shares necessary to qualify persons as directors, are beneficially
owned by the corporation or each other.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 2018, c. 8, s. 122
329
Commentary
For the definition of affiliate, see subsections 2(2), (3) and (4). Section 117 exempts cross-
directors of affiliated companies (and individuals who serve in a capacity similar to that of a
director for other entities) from being required to supply information “by virtue only” of the
cross-directorship. This provision makes sense, as otherwise a director could be placed in a
conflict of interest whereby he or she might be required to breach a fiduciary obligation.
Also, minority shareholders of the affiliated company could be unduly prejudiced if a direc-
tor (or individual who serves in a capacity similar to that of a director for other entities) were
required to give such information. The non-application of this section to wholly owned affili-
ates also makes sense, as unlike “mere” affiliates, wholly owned affiliates are essentially one
economic unit. In addition, there are no minority shareholders who could be prejudiced by
the release of such information.
This section can best be understood as a “saving” provision, since there is no apparent re-
quirement in the Act for a director of a corporation to supply any information. The entity is
required to supply information under section 114 and an authorized official, not necessarily a
director (or individual who serves in a capacity similar to that of a director for other entities),
is required by section 118 to certify the accuracy of such information. However, nowhere in
the Act is there any requirement that directors personally supply any information. In effect,
then, this section provides a “shield” for directors acquiring information by virtue of their
cross-directorship alone.
It should be noted that since affiliates are defined in section 2 in terms of de jure control, any
relevant information which an affiliate has should be able to be acquired by the corporation
proposing the merger through more formal means, for example, through exercise of its ma-
jority control of the board of directors.
118. Information to be certified — The information supplied to the Com-

missioner under section 114 shall be certified on oath or solemn affirmation as
having been examined by one of the following individuals and as being, to the
best of that individual’s knowledge and belief, correct and complete in all ma-
terial respects:
(a) in the case of a corporation supplying the information, by an officer of
the corporation or other person duly authorized by the board of directors
or other governing body of the corporation;
(b) in the case of an entity other than a corporation supplying the infor-
mation, by an individual who serves in a capacity similar to that of an
officer of a corporation or other individual duly authorized by the gov-
erning body of that entity;
(c) in the case of an individual supplying the information, by that
individual.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.17); 2018, c. 8, s. 123
Commentary
In practice, the Competition Bureau has not required that the affidavit and certificate to be
submitted in a particular legal form. The issue sometimes arises where the notifying party is
a non-Canadian and the oath or affirmation is being completed in a jurisdiction outside Can-
ada. In such cases, the Bureau has accepted oaths or affirmations completed pursuant to the
330
legal requirements of those foreign jurisdictions, as long as the materials are in the English
or French languages. If information is later found to be inaccurate or incomplete, the indivi-
dual who swore to the information would have a general duty to report and rectify the mis-
take or omission. This does not normally render the initial filing invalid.
The requirement to certify compliance with a Supplemental Information Request (“SIR”)
under subs. 114(2) using the form of words required by s. 118 can be problematic. This is
Act
because a person certifying compliance may be incapable of personally “examining” the
large volume of information produced in response to the SIR. In some cases the Commis-
sioner has permitted parties to certify that they have “examined or caused to have been ex-
amined” the SIR response.
119. Where transaction not completed — Where notice is given and in-
formation supplied in respect of a proposed transaction under section 114 but
the transaction is not completed within one year thereafter or such longer pe-
riod as the Commissioner may specify in any particular case, section 114 ap-
plies as if no notice were given or information supplied.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.17)
Commentary
Note that the one year duration during which the merger can be completed without re-notifi-
cation requires “completion”, not “substantial completion”.
Section 115 provides exceptions to the basic one-year duration rule. See the commentary to
section 115. See also the commentary to paragraph 113(b). There is a permanent exemption
from pre-merger notification where an Advance Ruling Certificate is sought and an ARC or
no-action letter pursuant to paragraph 113(c) is issued. This exemption does not apply if a
pre-merger notification form is also filed and an ARC or paragraph 113(c) waiver is not
granted. In those circumstances, that is, where the waiting periods expire and/or a standard
form no-action letter is issued, re-notification would be required if the proposed transaction
is not completed within one year.
The Competition Bureau’s Pre-Merger Notification Interpretation Guideline Number 8:
“Substantially Completed” and “Completed” (sections 103 and 119 of the Act) also pro-
vides guidance as to the meaning of the word “completed” as it is used in section 119.
120. [Repealed 1999, c. 2, s. 34.]
121. [Repealed 1999, c. 2, s. 34.]
122. [Repealed 1999, c. 2, s. 34.]
331

123. (1) Time when transaction may not proceed — A proposed trans-
action referred to in section 114 shall not be completed before the end of
(a) 30 days after the day on which information required under subsection
114(1) has been received by the Commissioner, if the Commissioner has
not, within that time, required additional information to be supplied
under subsection 114(2); or
(b) 30 days after the day on which the information required under subsec-
tion 114(2) has been received by the Commissioner, if the Commissioner
has within the 30-day period referred to in paragraph (a) required addi-
tional information to be supplied under subsection 114(2).
(2) Waiving of waiting period — A proposed transaction referred to in
section 114 may be completed before the end of a period referred to in subsec-
tion (1) if, before the end of that period, the Commissioner or a person author-
ized by the Commissioner notifies the parties to the transaction that the Com-
missioner does not, at that time, intend to make an application under section
92 in respect of that proposed transaction.
(3) Acquisition of equity interests — In the case of an acquisition of eq-
uity interests to which subsection 114(3) applies, the periods referred to in sub-
section (1) shall be determined without reference to the day on which the in-
formation required under section 114 is received by the Commissioner from
the entity whose equity interests are being acquired.
124
Commentary
This section establishes the statutory waiting period during which the proposed transaction
cannot be completed. The section does not prohibit steps taken towards completion, it
merely provides that the transaction may not close prior to the expiry of the waiting period.
This likely grants merger parties the flexibility to engage a relatively wide range of activities
during the waiting period. Indeed, concerns about “gun-jumping” in the US and other juris-
dictions are likely not relevant in Canada.
However, merger parties should not view their activities as being without legal consequence
so long as they fall short of completion of the transaction. In a merger between rivals, signif-
icant transfers of competitively sensitive information, the integration of operations or coordi-
nation in the marketplace may raise issues under sections 45 and 90.1.
The 1991 Merger Enforcement Guidelines contained the following statement on information
exchanges between merging parties:
Information exchanged during merger negotiations which do not ultimately lead to a
merger could raise questions which may require examination pursuant to the con-
spiracy provisions of section 45 of the Act. This risk can be reduced by limiting the
information exchanged to that which is reasonably necessary to make a decision to
merge, and by ensuring to the extent possible that such information is restricted to
332
persons involved in negotiating the transaction, e.g., lawyers, accountants, chief ex-
ecutive officers or merger counsellors. Unless there are legitimate reasons why com-
mercially sensitive information needs to be shared in both directions, such risk can
also be reduced by ensuring that information flow is one way.
See Merger Enforcement Guidelines (Ottawa: Competition Bureau, March 1991) at §6.6.
Act
According to the Competitor Collaboration Guidelines, “[a]n agreement to abstain from
making material changes to a business pending the consummation of a “merger” will be
assessed under 90.1. Such pre-merger coordination would be subject to a remedial order if it
was found to result in a substantial lessening or prevention of competition.
In R. v. Béton Régional Inc., two companies in the cement industry in Quebec became the
subject of a Bureau conspiracy investigation because of activities prior to approval of their
merger, which ultimately did not proceed. As part of the agreement in principle, the pur-
chaser assumed control over a subsidiary and also asked the seller to raise the price of ready-
mix concrete, to which the seller obliged. The case was resolved when the sellers consented
to an issuance of a court order prohibiting them from engaging in certain activities.
The initial waiting period is 30 days, which begins to run from receipt of information by the
Commissioner. Section 123 provides that the 30-day waiting periods begin to run from the
time when the information is “received” by the Commissioner of Competition and not from
the time when information is filed or sent to the Commissioner. The Commissioner takes the
position that materials must be received during normal business hours for the waiting period
to start on the day that they are submitted to the Competition Bureau. In other words, a
notification filing submitted by email at 6 p.m. Monday will not be received until 9 a.m.
Tuesday. The word “receive” is not defined in the Competition Act. In general, case law
indicates that materials are received when they are actually opened or viewed by the in-
tended recipient. Materials that were appropriately sent but not viewed due to some fault of
the intended recipient have been considered to have been constructively received by the re-
cipient. Constructive receipt will also be made out if the recipient intentionally avoids the
materials. Therefore, unless the Competition Bureau actually opened or viewed the material
after business hours, the Commissioner’s policy on the timeframe for the receipt of materials
under s. 123 is likely reasonably defensible.
In practice, each merger party generally files its own filing form, which means that the wait-
ing period will not commence until each or all parties have submitted their filings. An excep-
tion to this is provided for in subsection 123(3). Under subsection 123(3), designed to be
used in hostile takeover transactions, the waiting period begins to run from the date upon
which the person proposing to acquire equity interests has filed its notification form and not
the date upon which a complete filing with information from both parties is filed. See also
Hostile Transactions Interpretation Guideline Number 2: Bureau Policy on Running of Sub-
section 123(1) Waiting Periods.
Section 26 of the Interpretation Act, RSC 1985, c I-21, as amended, provides that “[w]here
the time limited for the doing of a thing expires or falls on a holiday, the thing may be done
on the day next following that is not a holiday.” Holidays are defined both in the Act and in
the Procedures Guide. Subsection 27(4) Interpretation Act provides that “[w]here a time is
expressed to begin after or to be from a specified day, the time does not include that day.”
Failure to comply with section 123 is reviewable practice under section 123.1.
Under the Competition Act (Ottawa: Competition Bureau, 2010).
333
123.1 (1) Failure to comply — If, on application by the Commissioner, the

court determines that a person, without good and sufficient cause, the proof of
which lies on the person, has completed or is likely to complete a proposed
transaction before the end of the applicable period referred to in section 123,
the court may
(a) order the person to submit information required under subsection
114(2);
(b) issue an interim order prohibiting any person from doing anything
that it appears to the court may constitute or be directed toward the com-
pletion or implementation of the proposed transaction;
(c) in the case of a completed transaction, order any party to the transac-
tion or any other person, in any manner that the court directs, to dissolve
the merger or to dispose of assets or shares designated by the court;
(d) in the case of a completed transaction, order the person to pay, in any
manner that the court specifies, an administrative monetary penalty in an
amount not exceeding $10,000 for each day on which they have failed to
comply with section 123, determined by the court after taking into ac-
count any evidence of the following:
(i) the person’s financial position,
(ii) the person’s history of compliance with this Act,
(iii) the duration of the period of non-compliance, and
(iv) any other relevant factor; or
(e) grant any other relief that the court considers appropriate.
(2) Purpose of order — The terms of an order under paragraph (1)(d)
shall be determined with a view to promoting conduct by the person that is in
conformity with the purposes of this Part and not with a view to punishment.
(3) Unpaid monetary penalty — The amount of an administrative mone-
tary penalty imposed under paragraph (1)(d) is a debt due to Her Majesty in
right of Canada and may be recovered as such from the person in a court of
competent jurisdiction.
(4) Definition of “court” — In this section, “court” means the Tribunal,
the Federal Court or the superior court of a province.
2009, c. 2, s. 439
Commentary
Subsection 123.1(1) provides for far-reaching remedies where the parties to a proposed
transaction complete or are likely to complete the transaction prior to the expiry of the rele-
vant waiting period. These include administrative monetary penalties of up to $10,000 per
day of non-compliance as well as dissolution or divestiture. The non-financial remedies are
unusual and would appear to permit a dissolution or divestiture regardless of whether or not
the transaction resulted or would result in a substantial lessening or prevention of competi-
tion (unlike s. 92).
334
Part X — General (ss. 124.1–128) S. 124.1
It is unclear whether parties to a transaction would contravene subs. 123.1(1) if they (also)
failed to submit a pre-merger notification under subs. 114(1), or whether subs. 123.1(1) is
only applicable where such notification has been made. The latter interpretation is likely
preferable, in part because a failure to notify a proposed transaction would not trigger the s.
123 waiting period referred to in subs. 123.1(1). If this interpretation is correct, only subs.
65(2) would be applicable in circumstances where parties failed to notify and subsequently
Act
completed, or were likely to complete, a proposed transaction.
Regulations
124. (1) Regulations — The Governor in Council may make regulations
prescribing anything that is by this Part to be prescribed.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
PART X — GENERAL (SS. 124.1–128)

Commissioner’s Opinions
124.1 (1) Application for written opinion — Any person may apply to the
Commissioner, with supporting information, for an opinion on the applicabil-
ity of any provision of this Act or the regulations to conduct or a practice that
the applicant proposes to engage in, and the Commissioner may provide a
written opinion for the applicant’s guidance.
(2) Opinion binding — If all the material facts have been submitted by or
on behalf of an applicant for an opinion and they are accurate, a written opin-
ion provided under this section is binding on the Commissioner. It remains
binding for so long as the material facts on which the opinion was based re-
main substantially unchanged and the conduct or practice is carried out sub-
stantially as proposed.
2002, c. 16, s. 15
Commentary
This section, which has never been judicially considered, allows the Commissioner of Com-
petition to issue binding written opinions. The precise meaning of the term “binding on the
335
Commissioner” is somewhat unclear. Unlike section 103, the section does not expressly bar
the Commissioner from bringing an application to the Tribunal (or recommending a criminal
prosecution) because an opinion may be unfavourable to an applicant. Where the Commis-
sioner issues a favourable binding opinion that conduct would not constitute a reviewable
practice or offence, the Commissioner presumably would be prevented from subsequently
bringing an application or prosecution recommendation in connection with that conduct. The
section does not on its face bind the Attorney General (with respect to criminal prosecutions)
nor does it prevent third parties from commencing: damage claims under section 36; private
applications under section 103.1; or common law claims. That said, it would likely be factu-
ally difficult for a plaintiff or applicant to assert that conduct sanctioned by the Commis-
sioner breached the Competition Act.
See also Competition Bureau Fee and Service Standards Handbook for Written Opinions
(Ottawa: Competition Bureau, 2010), which provides an outline of the application process,
including information about filing fees and processing times.
References to Tribunal
124.2 (1) Reference if parties agree — The Commissioner and a person

who is the subject of an inquiry under section 10 may by agreement refer to
the Tribunal for determination any question of law, mixed law and fact, juris-
diction, practice or procedure, in relation to the application or interpretation
of Part VII.1 or VIII, whether or not an application has been made under Part
VII.1 or VIII.
(2) Reference by Commissioner — The Commissioner may, at any time,
refer to the Tribunal for determination a question of law, jurisdiction, practice
or procedure, in relation to the application or interpretation of Parts VII.1 to
IX.
(3) Reference by agreement of parties to a private action — A per-
son granted leave under section 103.1 and the person against whom an order is
sought under section 75, 76 or 77 may by agreement refer to the Tribunal for
determination any question of law, or mixed law and fact, in relation to the
application or interpretation of Part VIII, if the Tribunal grants them leave.
They must send a notice of their application for leave to the Commissioner,
who may intervene in the proceedings.
(4) Reference procedure — The Tribunal shall decide the questions re-
ferred to it informally and expeditiously, in accordance with any rules on ref-
erences made under section 16 of the Competition Tribunal Act.
2002, c. 16, s. 15; 2015, c. 3, s. 41
Commentary
Section 124.2 gives the Tribunal the authority to hear references concerning a specific aspect
of a dispute without the need for a full hearing. The Commissioner and a person that is
subject to a s. 10 inquiry can by agreement refer to the Tribunal for determination of any
question of law, mixed law and fact, jurisdiction, and practice or procedure in relation to the
336
Part X — General (ss. 124.1–128) S. 125
deceptive marketing practices and reviewable practices parts of the Act. The Commissioner
can at any time refer to the Tribunal a question of law, jurisdiction, practice or procedure
relating to the deceptive marketing practices part, the reviewable practices part, and the pro-
visions concerning notifiable transactions. A party acting alone cannot refer a matter to the
Tribunal. To date there have been two references brought before the Tribunal pursuant to
section 124.2. Both of these references were brought unilaterally by the Commissioner under
Act
subsection 124.2(2), in connection with s. 106 of the Act. See also section 106 and related
commentary.
Case Law
Burns Lake Native Development Corp. v. Canada (Commissioner of Competition) (2006), 47
C.P.R. (4th) 343 (F.C.A.) — The Commissioner’s power to make a reference under s. 124(2)
of the Act “at any time” enables the Commissioner to refer a question arising in the course of
a proceeding before the Tribunal to which the Commissioner is a party. The questions re-
ferred for determination were not improper on the ground that they were academic, hypothet-
ical or advisory in nature. As a reference under s. 124.2(2) of the Act may be made outside
the context of a specific proceeding, the case law under s. 18.3 of the Federal Courts Act did
not apply. Where the Tribunal rendered its decision on the basis of a case management tele-
phone conference, there was no denial of a fair hearing.
Representations to Boards, Commissions or Other

Tribunals
125. (1) Representations to federal boards, etc. — The Commissioner,
at the request of any federal board, commission or other tribunal or on his
own initiative, may, and on direction from the Minister shall, make represen-
tations to and call evidence before the board, commission or other tribunal in
respect of competition, whenever such representations are, or evidence is, rele-
vant to a matter before the board, commission or other tribunal, and to the
factors that the board, commission or other tribunal is entitled to take into
consideration in determining the matter.
(2) Definition of “federal board, commission or other tribunal” —
For the purposes of this section, “federal board, commission or other tribunal”
means any board, commission, tribunal or person that carries on regulatory
activities and is expressly charged by or pursuant to an enactment of Parlia-
ment with the responsibility of making decisions or recommendations related
directly or indirectly to the production, supply, acquisition or distribution of a
product.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.18)
Case Law
Canada (Director of Investigation & Research, Competition Act) v. Canadian International
Trade Tribunal (1993), 52 C.P.R. (3d) 71, 164 N.R. 254 (Fed. C.A.) — The power given to
the Director to intervene in the public interest before any federal tribunal does not include an
automatic right to all confidential information in the tribunal’s possession.
337
126. (1) Representations to provincial boards, etc. — The Commis-

sioner, at the request of any provincial board, commission or other tribunal,
or on his own initiative with the consent of the board, commission or other
tribunal, may make representations to and call evidence before the board,
commission or other tribunal in respect of competition, whenever such repre-
sentations are, or evidence is, relevant to a matter before the board, commis-
sion or other tribunal, and to the factors that the board, commission or other
tribunal is entitled to take into consideration in determining the matter.
(2) Definition of “provincial board, commission or other tribu-
nal” — For the purposes of this section, “provincial board, commission or
other tribunal” means any board, commission, tribunal or person that carries
on regulatory activities and is expressly charged by or pursuant to an enact-
ment of the legislature of a province with the responsibility of making deci-
sions or recommendations related directly or indirectly to the production, sup-
ply, acquisition or distribution of a product.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37(z.19)
127. Annual report — The Commissioner shall report annually to the Min-
ister on the operation of the Acts referred to in subsection 7(1), and the Min-
ister shall cause the report to be laid before each House of Parliament on any
of the first fifteen days after the Minister receives the report on which that
House is sitting.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 36
Regulations
128. (1) Regulations — The Governor in Council may make such regula-
tions as are necessary for carrying out this Act and for the efficient adminis-
tration thereof.
R.S.C. 1985, c. 19 (2nd Supp.), s. 45
338
Part X — General (ss. 124.1–128) S. 128(3)
— 2009, c. 2, s. 440:
440. Agreements or arrangements entered into before royal assent — Any
party to an agreement or arrangement entered into before the day on which this Act
receives royal assent may, within one year after that day, apply under section 124.1
Act
of the Competition Act without payment of any fee for an opinion on the applicabil-
ity to the agreement or arrangement of section 45 or 90.1 of the Competition Act, as
enacted by sections 410 and 429, respectively, as if the agreement or arrangement
had not yet been entered into and as if that section 45 or 90.1 were in force.
339
CAN. REG. 87-348 — NOTIFIABLE TRANSACTIONS
REGULATIONS
Regulations
made under the Competition Act
Regulations Respecting Notifiable Transactions Pur-
suant to Part VIII of the Competition Act
SOR/87-348, as am. SOR/2000-8, ss. 1–4, 5 (Fr.), 6 (Fr.), 7, 8; SOR/2003-
104; SOR/2010-22.
SHORT TITLE
1. These Regulations may be cited as the Notifiable Transactions Regulations.
INTERPRETATION
2. In these Regulations,
“Act” means the Competition Act; (“Loi”)
“asset securitization transaction” means a transaction or series of related
transactions entered into where
(a) for the purpose of obtaining funds or credit or for related financial
purposes, a person, directly or indirectly, sells, assigns, transfers, leases or
otherwise disposes of financial assets to a person or persons or a trust or
trusts who acquire an undivided co-ownership interest or interests in the
financial assets or whose business consists solely or primarily of acquir-
ing, holding or creating interests in, creating securities or debt backed or
secured by, or otherwise dealing in, financial assets, and
(b) after their disposal, the financial assets will be administered, serviced
and operated by
(i) the person disposing of the financial assets or an affiliate of that
person,
(ii) a person that is an agent of or a trustee for all persons that own
securities or debt backed or secured by, or representing an interest
in, the financial assets unless there is a person that, together with
that person’s affiliates, owns, directly or indirectly, or exercises con-
trol or direction over more than 10 per cent of the securities or debt
backed or secured by, or representing an interest in, the financial
assets, or
341
S. 2 ass Can. Reg. 87-348 — Notifiable Transactions
(iii) any other person or trust other than,

(A) a person or persons or trust or trusts that acquire any inter-
est in the financial assets unless the interest is held by way of
security only or is limited to an undivided co-ownership interest
or interests that, in aggregate, are not more than 10 per cent of
all the interests,
(B) an affiliate of a person described in clause (A),
(C) a person that, together with that person’s affiliates, owns,
directly or indirectly, or exercises control or direction over more
than 10 per cent of the securities or debt back or secured by, or
representing an interest in, the financial assets,
(D) a person that owns, directly or indirectly,
(I) securities carrying more than 10 per cent of the voting
rights attached to all voting securities for the time being
outstanding of a person described in clause (C), or
(II) more than 10 per cent of the equity securities for the
time being outstanding of a person described in clause (C),
or
(E) a corporation of which a person described in clause (C)
owns, directly or indirectly,
(I) securities carrying more than 10 per cent of the voting
rights attached to all voting securities of the corporation for
the time being outstanding, or
(II) more than 10 per cent of the equity securities of the cor-
poration for the time being outstanding;
(“transaction de titralisation d’éléments d’actif”)
“audited financial statements” means financial statements in respect of which
a report has been prepared by an external professional auditor accredited for
that purpose who is a member in good standing of any corporation, association
or institute of professional accountants; (“états financiers vérifiés”)
“equity security” (means any security that carries a residual right to partici-
pate in the earnings of the issuer of the security and, upon the liquidation and
winding up of the issuer, in the issuer’s assets; (“titres de toute nature”)
“financial asset” means any interest, including any related security or collat-
eral, in any
(a) debt, receivable, account, claim or other right to payment,
(b) contract or obligation that generates or secures any thing referred to
in paragraph (a), and
(c) security (other than a voting share of a corporation or an interest in a
combination) backed or secured by, or representing an interest in, a thing
referred to in paragraph (a) or (b) or in both paragraphs (a) and (b);
342
Audited Financial Statements S. 3
(“actif financier”)
“reference date” means
(a) where the Commissioner is notified of a proposed transaction pursu-
ant to section 114 of the Act, the date on which the Commissioner receives
the notification; and
(b) where the notification referred to in paragraph (a) is not given to the
Commissioner,
Regulations
(i) in the case of a proposed transaction referred to in subsection
110(4) of the Act, the thirtieth day preceding the day on which arti-
cles of amalgamation in respect of the proposed transaction are filed
with the appropriate governmental or regulatory authority, and
(ii) in the case of a proposed transaction referred to in subsection
110(2), (3), (5) or (6) of the Act, the thirtieth day preceding the day
on which beneficial ownership of property forming any part of the
subject-matter of the transaction is to be conveyed, assigned or oth-
erwise transferred;
(“date de référence”)
“senior officer” [Repealed SOR/2010-22, s. 1.]
“voting security” means any security that carries voting rights under all cir-
cumstances or by reason of an event that has occurred and is continuing; (“ti-
tres comportant droit de vote”)
SOR/2000-8, s. 1; SOR/2010-22, s. 1
AUDITED FINANCIAL STATEMENTS

3. Audited financial statements shall
(a) be prepared in accordance with accounting principles that are nor-
mally used by the person with respect to whom the statements were pre-
pared and that are generally accepted for the type of business carried on
by the person; and
(b) include working papers and other records used to prepare audited fi-
nancial statements if reference to the working papers and other records is
necessary to obtain information required for making a determination,
pursuant to sections 109 and 110 of the Act, of the aggregate value of
assets or the gross revenues from sales.
SOR/2010-22, s. 11(a)
Commentary
The determination of whether the relevant thresholds for merger notification are satisfied
must be made by reference to “audited financial statements.” However, the reference in para-
graph 3(b) to “working papers and other records” allows parties to refer to and rely on
unaudited financial statements if necessary. For example, if the target does not itself prepare
audited financial statements but is the subsidiary of an entity that does prepare audited finan-
343
S. 3 Can. Reg. 87-348 — Notifiable Transactions
cial statements, the determination of asset values and revenues should be based on the au-
dited financial statements of the parent. If that is not possible, for example because the au-
dited financial statements do not have segmented information about the subsidiary, the
regulations permit parties to turn to the unaudited financial statements, in this case of the
unaudited financial statements of the subsidiary/target, in order to determine the relevant
financial values.
DETERMINATION OF AGGREGATE VALUE — GENERAL

4. (1) For the purposes of sections 109 and 110 of the Act, in determining the
aggregate value of assets, the following amounts shall be deducted:
(a) any amount that represents duplication arising from transactions be-
tween affiliates;
(b) any amount that represents duplication arising from an ownership in-
terest of one person in another person, whether or not those persons are
affiliated; and
(c) any amount provided for depreciation or diminution of value.
(2) For the purposes of sections 109 and 110 of the Act, in determining the
aggregate value of assets, no amount shall be deducted for liabilities or
encumbrances.
(3) The aggregate value of assets shall be expressed in Canadian dollars.
(4) The conversion into Canadian dollars of the aggregate amount of assets
reported in foreign currency shall be based on the noon exchange rate quoted
by the Bank of Canada on the date that the aggregate value of assets is to be
determined in accordance with these Regulations.
SOR/2000-8, s. 2; SOR/2010-22, s. 11(b)
Commentary
Paragraph 4(1)(a) and subsection 5(2) permit deductions for amounts that represent duplica-
tion arising from transactions between affiliates. However, these provisions do not permit
deductions for all transactions between affiliates, even where such transactions would be
eliminated on consolidation. This is because the pre-merger notification requirements in sec-
tions 109 and 110 of the Competition Act are designed to identify parties and transactions
that have a material nexus to Canada by reference to economic activity in Canada. Account-
ing rules, and their treatment of transactions between affiliates, are designed to assess the
overall economic value of a total enterprise and not the geographic location of economic
activity. This means that the strict application of accounting rules can defeat the intention of
the legislation and that consolidated financial statements cannot necessarily be relied on to
determine asset and revenue values for the purposes of sections 109 and 110.
For example, assume a Canadian parent sells of $50 million of Product A to its US subsidi-
ary and the US subsidiary sells the product to US customers for a total of $60 million. On
consolidation that would be booked as $60 million of revenue attributable to the Canadian
parent. However, for the purposes of pre-merger notification, this transaction ought to be
treated as a sale “from Canada” of $50 million. The fact that is was an inter-company trans-
344
Determination of Aggregate Value — General S. 5(2)
action is irrelevant and subsection 5(2) is inapplicable, because there is no duplication in

calculating the revenues generated from sales “from Canada”.
Paragraph 4(1)(a) and subsection 5(2) merely permit deductions relating to any “duplica-
tion”, or double-counting, of assets or revenues. For example, assume a Belgian parent com-
pany had two Canadian affiliates and that Canadian affiliate A sold $50 million worth of
Product A to Canadian affiliate B, which then sold it to Canadian consumers for $50 million.
On consolidation, $50 million in revenues would appear on the income statement of the
Belgian parent company. For the purposes of pre-merger notification, however, that transac-
Regulations
tion should be treated as a sale “in Canada” that generated revenue of $50 million. Subsec-
tion 5(2) would permit the deduction of the initial sale from Canadian affiliate A of $50
million to avoid having that revenue counted twice, once as revenue of Canadian affiliate A
and once as revenue of Canadian affiliate B. Similarly, a sale from US affiliate C to one of
the Canadian affiliates would be a sale “into Canada”, unless it could be shown that the
product was subsequently resold in Canada (or was an input that accounted for a Canadian
sale) and was accounted for as the Canadian affiliate’s sale. If it was re-sold in Canada, a
subsection 5(2) deduction could be made, because including both the revenues generated
from the sale “into Canada” and the subsequent sale “in Canada” would be double-counting
and result in duplication.
Inter-company debts may also be treated as Canadian assets. For example, an account receiv-
able on the financial statements of a Canadian affiliate relating to a sale to a Dutch affiliate
would be treated as an asset in Canada. So too would a loan from a Canadian affiliate to a
Dutch affiliate, which would also appear as an asset on the financial statements of the Cana-
dian affiliate. Nevertheless, the mere fact that the debts are inter-company does not permit
them to be deducted; deductions can only be made where there is duplication.
These rules can give rise to considerable practical difficulty because it may be necessary for
merger parties to go beyond a consolidated financial statements in order to assess whether
pre-merger notification thresholds are exceed. However, there is a clear logic to the require-
ments: Part IX is designed to capture transactions involving parties that have a material con-
nection to Canada by reference to the size of their assets and revenues.
See also Pre-Merger Notification Interpretation Guideline Number 14: Duplication Arising
From Transactions Between Affiliates, designed to provide guidance to parties when calcu-
lating what amounts may be deducted owing to duplication where a proposed transaction
involves affiliates.
5. (1) Subject to subsection (2), for the purposes of sections 109 and 110 of the
Act, the gross revenues from sales of a person for an annual period shall be
determined by aggregating the following amounts accruing to that person dur-
ing that period:
(a) amounts accruing from the sale or lease of goods, other than amounts
that are not properly included in revenue in accordance with the account-
ing principles referred to in paragraph 3(a);
(b) amounts accruing from the rendering of services
without deducting any expenses or other amounts incurred or provided for in
relation to the sale or lease of goods or the rendering of services.
(2) In determining the gross revenues from sales, any amount that represents
duplication arising from transactions between affiliates shall be deducted.
345
S. 5(3) Can. Reg. 87-348 — Notifiable Transactions
(3) Gross revenues from sales shall be expressed in Canadian dollars.

(4) The conversion into Canadian dollars of the gross revenues from sales re-
ported in foreign currency shall be based on the noon exchange rate quoted by
the Bank of Canada on the last day of the annual period for which the gross
revenues from sales are to be determined in accordance with these
Regulations.
SOR/2000-8, s. 3; SOR/2010-22, s. 11(c)
Commentary
See commentary under section 4 of the Regulations.
6. Subject to section 12, for the purposes of sections 109 and 110 of the Act, the
aggregate value of assets of a person shall be determined as of the last day of
the period covered by the most recent audited financial statements in which
those assets are accounted for, where that day is not more than 15 months
prior to the reference date.
SOR/2010-22, s. 11(d)
7. Subject to section 13, for the purposes of sections 109 and 110 of the Act,
gross revenues from sales of a person shall be determined for the annual pe-
riod ended on the last day, which day is not more than 15 months prior to the
reference date, of the period.
(a) covered by the most recent audited financial statements in which those
gross revenues are accounted for; and
(b) in the case where the period covered by the financial statements re-
ferred to in paragraph (a) is less than 12 months, covered by those finan-
cial statements and by audited financial statements in which the gross
revenues are accounted for, covering the balance of the 12-month period.
SOR/2010-22, s. 11(d)
PROVISIONS WITH RESPECT TO PARTIES TO THE TRANSACTION

8. (1) For the purposes of paragraph 109(1)(a) of the Act, the aggregate value
of assets in Canada of the parties to a transaction, together with their affili-
ates, shall be determined by aggregating the aggregate values of the assets in
Canada of each of the parties and each affiliate.
(2) For each party or affiliate referred to in subsection (1), the aggregate value
of its assets in Canada shall equal the aggregate amount of these assets as
stated in the audited financial statements referred to in section 6.
SOR/2010-22, s. 11(e)
9. (1) For the purposes of paragraph 109(1)(b) of the Act, gross revenues from
sales in, from or into Canada of the parties to a transaction, together with
346
Provisions Applicable to Transactions S. 10(d)
their affiliates, shall be determined by aggregating the gross revenues from

sales in, from or into Canada of each of the parties and each affiliate.
(2) For each party or affiliate referred to in subsection (1), the gross revenues
from sales in, from or into Canada shall equal the aggregate amount of those
gross revenues as stated in the audited financial statements referred to in sec-
tion 7.
SOR/2010-22, s. 11(f)
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PROVISIONS WITH RESPECT TO PARTIES TO AN
AMALGAMATION
[Heading added SOR/2010-22, s. 2.]
9.1 (1) For the purpose of subsection 110(4.1) of the Act, the aggregate value of
assets in Canada of an amalgamating corporation, together with its affiliates,
shall be determined by aggregating the aggregate values of the assets in Can-
ada of the corporation and each affiliate.
(2) For the amalgamating corporation and each affiliate, the aggregate value
of its assets in Canada shall equal the aggregate amount of those assets as
stated in the audited financial statements referred to in section 6.
SOR/2010-22, s. 2
9.2 (1) For the purpose of subsection 110(4.1) of the Act, gross revenues from
sales in, from or into Canada of an amalgamating corporation, together with
its affiliates, shall be determined by aggregating the gross revenues from sales
in, from or into Canada of the corporation and each affiliate.
(2) For the amalgamating corporation and each affiliate, the gross revenues
from sales in, from or into Canada shall equal the aggregate amount of those
gross revenues as stated in the audited financial statements referred to in sec-
tion 7.
SOR/2010-22, s. 2
PROVISIONS APPLICABLE TO TRANSACTIONS

10. For the purposes of subsections 110(2) to (4), (5) and (6) of the Act, the
aggregate value of assets in Canada
(a) of an operating business referred to in subsection 110(2) of the Act,
(b) that are owned by any corporation referred to in paragraph 110(3)(a)
of the Act,
(c) that would be owned by any corporation referred to in paragraph
110(4)(a) of the Act, or
(d) that are the subject-matter of a combination referred to in subsection
110(5) or (6) of the Act
347
shall equal the aggregate value of such assets, as stated in the audited financial
statements referred to in section 6.
SOR/2000-8, s. 4; SOR/2010-22, s. 3
11. For the purposes of subsections 110(2) to (4), (5) and (6) of the Act, the
gross revenues from sales in or from Canada generated from the assets in
Canada
(a) of an operating business referred to in subsection 110(2) of the Act,
(b) that are owned by any corporation referred to in paragraph 110(3)(a)
of the Act,
(c) that would be owned by any corporation referred to in paragraph
110(4)(a) of the Act, or
(d) that are the subject-matter of a combination referred to in subsection
110(5) or (6) of the Act
shall equal the aggregate amount of the gross revenues from sales in or from
Canada generated from such assets, as stated in the audited financial state-
ments referred to in section 7.
SOR/2000-8, s. 4; SOR/2010-22, s. 4
DETERMINATION OF AGGREGATE VALUE — SPECIFIC

CIRCUMSTANCES
12. (1) If the aggregate value of a person’s assets cannot reasonably be deter-
mined in accordance with subsection 8(2) or 9.1(2) or section 10, the aggregate
value of the assets
(a) shall equal the aggregate amount of the assets as stated in the books of
the person with such adjustment as may be necessary to ensure that the
determination is in accordance with the accounting principles referred to
in paragraph 3(a); and
(b) shall be determined as of the most recent date that the amount can
reasonably be determined, provided that that date is within three months
prior to the reference date.
(2) Specific Circumstances — The determination of the aggregate value
of assets referred to in subsection (1) is subject to the requirements of section
4.
SOR/2010-22, s. 5
13. (1) If gross revenues from a person’s sales cannot reasonably be deter-
mined in accordance with subsection 9(2) or 9.2(2) or section 11, the gross
revenues
(a) shall equal the amount of the gross revenues as stated in the books of
the person with such adjustments as may be necessary to ensure that the
348
Determination of Aggregate Value — Specific Circumstances S. 14
determination is in accordance with the accounting principles referred to

in paragraph 3(a); and
(b) shall be determined for the most recent annual period for which the
amount can reasonably be determined provided that the last day of that
period is within three months prior to the reference date.
(2) The determination of the gross revenues from sales referred to in subsec-
tion (1) is subject to the requirements of section 5.
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SOR/2010-22, s. 6
14. (1) If, subsequent to the day or date referred to in section 6 or 12 or the
annual period referred to in section 7 or 13, as the case may be, any party to a
proposed transaction or any affiliate of that party was a party to or was other-
wise affected by a transaction or event the consequences of which, if taken into
account, would affect the determination of whether notification is required to
be given under section 114 of the Act with respect to the proposed transaction,
the values or amounts referred to in sections 8 to 13 shall be adjusted to reflect
that transaction or event.
(2) A transaction or event referred to in subsection (1) includes any of the
following:
(a) a write-down or re-evaluation for financial reporting purposes of the
value of any assets of the parties to the proposed transaction or their
affiliates;
(b) any disposition, acquisition or reorganization that is likely to have a
material effect on the aggregate value of the assets of the parties to the
proposed transaction or their affiliates; and
(c) any agreement, arrangement, understanding or other transaction or
event that is likely to have a material effect on the aggregate value of the
assets or gross revenues from sales of the parties to be proposed transac-
tion or their affiliates.
SOR/2010-22, s. 7
Commentary
Adjustments only need to be made where there is a material transaction or event. Normal
appreciation or depreciation between financial reporting periods will not usually require any
adjustment to be made under section 14. Where, however, ordinary business activities in-
volve material transactions or events, even ordinary course transactions or events may re-
quire that a section 14 adjustment be made.
Subsection 14(2) provides a non-exhaustive list of the types of transactions or events that
should be considered a subsequent event. Paragraph 14(2)(a) provides that any “write-down
or re-evaluation” of the value of the assets for financial reporting purposes constitutes a
subsequent event. Although there is no express materiality requirement in the paragraph,
write-downs or re-evaluations to reflect the reduced value of an impaired asset are generally
material from a financial reporting perspective. Paragraphs 14(2)(b) and 14(2)(c) are more
349
broadly worded and specifically require that the transaction or event in question have a “ma-
terial effect” on the aggregate value of the assets.
The Bureau in its Interpretation Guidelines states that “a material effect is one which would
affect the determination of whether notice is required under section 114.” This suggests that
a transaction or event that is non-material for financial reporting purposes could nevertheless
be material under section 14 if it is sufficient to trigger a notification obligation. This cannot
be correct: whether a transaction or event is “material” should be assessed by reference to
financial reporting standards and not by reference to whether it would not trigger a notifica-
tion obligation.
Where there is a subsequent event, the adjustment is made by adding or subtracting the as-
sets and revenues related to the event or events to and from the assets and revenues in the
party’s most recent audited annual financial statements. Unaudited interim financial state-
ments, if available, should not be used, although the net result of an adjustment may not be
materially different from the values or amounts reported in any interim financial statements.
Similarly, section 14 together with subsections 4(4) and 5(4) suggest that where amounts are
reported in a foreign currency the fiscal year-end Bank of Canada exchange rate is to be used
for conversion purposes; not the exchange rate on the date of the subsequent event or interim
financial statements.
Further guidance on the subsequent event rule may be found the Competition Bureau’s Pre-
Merger Notification Interpretation Guideline Number 10: Notifiable Transactions Regula-
tions — Transactions and Events (Section 14 of the Regulations).
[Heading repealed SOR/2010-22, s. 8.]
14.1 [Repealed SOR/2010-22, s. 8.]
TRANSACTIONS THAT ARE EXEMPT FROM PART IX OF THE

ACT
15. (1) A transaction that is an acquisition of financial assets that is under-

taken to give effect to an asset securitization transaction is exempt from the
application of Part IX of the Act.
(2) A transaction that is an acquisition of assets other than financial assets that
is undertaken to give effect to an asset securitization transaction is exempt
from the application of Part IX of the Act, unless any person would, as a result
of the transaction or transactions, acquire all or substantially all of the assets,
other than financial assets, of a business or an operating segment of a business
carried on by the person disposing of the assets.
SOR/2000-8, s. 7
350
Information Required S. 16(1)(c)(iv)(C.1)
INFORMATION REQUIRED
16. (1) For the purposes of subsection 114(1) of the Act and subject to subsec-
tion (2), the following information is to be supplied to the Commissioner:
(a) a description of the proposed transaction and the business objectives
intended to be achieved as a result of it;
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(a.1) a copy of each legal document, or the most recent draft of that docu-
ment if it is not yet executed, that is to be used to implement the proposed
transaction;
(b) a list of the foreign competition or antitrust authorities that have been
notified of the proposed transaction by the parties and the date on which
each authority was notified;
(c) in respect of each party,
(i) its full name,
(ii) the addresses of its principal offices,
(iii) a list of its affiliates that have significant assets in Canada or
significant gross revenues from sales in, from or into Canada and a
chart describing the relationships between the party and those affili-
ates, and
(iv) a description of its principal businesses and the principal busi-
nesses of its affiliates referred to in subparagraph (iii), including
(A) their most recent annual report and, if the annual report is
not available or if the financial statements are different from
those contained in the report, audited financial statements relat-
ing to their principal businesses for their most recently com-
pleted fiscal year, and financial statements for subsequent in-
terim periods,
(B) a summary description of each of the principal categories of
products, as defined by the party in its day-to-day operations,
that it produces, supplies or distributes and each of the principal
categories of products produced, supplied or distributed by its
affiliates referred to in subparagraph (iii),
(C) statements identifying, for each of those principal categories
of products, the twenty most important current suppliers and
customers, the contact names, the telephone numbers and ad-
dresses of those suppliers and customers, and the annual volume
or dollar value of purchases from and sales to those suppliers
and customers,
(C.1) statements identifying, for each of those principal catego-
ries of products, the total annual volume or dollar value of
purchases from and sales to all suppliers and customers, and
351
S. 16(1)(c)(iv)(D) Can. Reg. 87-348 — Notifiable Transactions
(D) the geographic regions of sales for its principal businesses

and the principal businesses of its affiliates; and
(d) in respect of each party, and each of its affiliates referred to in subpar-
agraph (c)(iii), all studies, surveys, analyses and reports that were pre-
pared or received by an officer or director of the corporation — or in the
case of an unincorporated entity, an individual who serves in a similar
capacity — for the purpose of evaluating or analysing the proposed trans-
action with respect to market shares, competition, competitors, markets,
potential for sales growth or expansion into new products or geographic
regions and, if not otherwise set out in that document, the names and ti-
tles of the individuals who prepared the document and the date on which
it was prepared.
(2) Instead of being supplied with a report or financial statement referred to in
clause (1)(c)(iv)(A), the Commissioner may be supplied with the address of an
Internet site from which a copy of those documents can be obtained without
charge, which is operational at the time the address is supplied and which re-
mains operational prior to the expiry of the period referred to in subsection
123(1) of the Act.
SOR/2000-8, s. 7; SOR/2010-22, s. 9
Commentary
Section 16 sets out the information required to be supplied to the Commissioner of Competi-
tion in connection with a merger transaction that is subject to a pre-merger notification re-
quirement pursuant to Part IX of the Competition Act. The Competition Bureau has pub-
lished these requirements in a pre-merger notification form, copies of which are reproduced
in this book and available on the Competition Bureau website.
Certain information is required to be provided for affiliates with “significant” assets or reve-
nues, but the word “significant” is not defined in the Regulations or the Act and therefore
ought to be assessed on a case-by-case basis.
Paragraph 16(1)(d) requires parties to provide information for the “most important current
suppliers and customers.” The word “important” is in practice usually taken to mean the top
suppliers and customers by reference to the current value of purchases and sales. However,
merger parties could presumably use some other measure to identify their “most important”
customers. Merger parties often provide supplier and customer information for a 12 month
period which is the same as their most recently completed fiscal year. Competition Bureau
staff usually accept filings with such information as being complete. However, the Regula-
tions clearly require that “current” customer and supplier information be provided. There is
therefore a risk that a filing could be rejected as incomplete if information is not current, for
example, if information for the most recent fiscal year has been provided and where the
suppliers and customers would be materially different if the data was “current.”
Paragraph 16(1)(d) requires parties to provide certain documents “prepared or received by an
officer or director.” The requirement is very similar to Item 4(c) of the US Hart-Scott-
Rodino Notification and Report Form required to be submitted pursuant to §803.1(a) of the
US pre-merger notification rules. The US practice is to confine the scope of “officers” to
positions designated by the by-laws or articles of incorporation or appointed by the board of
directors (or to individuals designated in a similar way by an unincorporated entity). See:
352
Information Required S. 16
ABA Section of the Antitrust Law, Pre-Merger Notification Practice Manual (4th edition)
(2007) at 333.
Paragraph 16(1)(d) is slightly different than Item 4(c). The US requirement is to submit “all
studies, surveys, analyses and reports which were prepared by or for any officer(s) or direc-
tor(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, compe-
tition, competitors, markets, potential for sales growth or expansion into product or geo-
graphic markets” (emphasis added). The Canadian requirement to produce any responsive
Regulations
document “received by” an officer or director appears to capture any responsive document
found in his or her possession. This seems broader than the US requirement, which only
requires the production of documents that were specifically “prepared for” an officer or di-
rector. However, in practice the US enforcement agencies presume that any responsive docu-
ment found in the files of an officer or director was prepared for him or her and therefore
responsive. The Canadian requirement would exclude documents “prepared for” a senior
officer but not actually received by him or her. Although this clearly differs from the word-
ing of the US requirement, here too, in practice the US enforcement agencies do not treat
documents that were never received by an officer or director as responsive. The Canadian
requirement eliminates the theoretical need to search files of individuals that may have pre-
pared a document “for” an officer or director but did not actually provide it to that person. In
sum, the Canadian requirement to produce documents “prepared or received by” certain indi-
viduals therefore appears to reflect the manner in which the US requirement is interpreted in
US practice.
For a review of the approach to the interpretation of the words and phrases in US Item 4(c),
see Marian R. Bruno, Brian C. Mohr and Bruce J. Prager, Some practical guidance for the
HSR practitioner: Locating and Identifying Item 4(c) Documents in Antitrust magazine
(ABA Section of Antitrust Law Spring, 2002) at 46. The article should provide Canadian
practitioners with a great deal of practical guidance with respect to the approach the Bureau
will take to clause 16(1)(c)(iv)(D), given the very close similarity between it and Item 4(c).
Section 116 of the Act allows parties to exclude information required to be provided by
subsection 16(1) on the basis that it is irrelevant, not reasonably obtainable or has previously
been provided to the Commissioner. In practice, the irrelevancy carve out helpfully permits
parties to exclude a great deal of information that is technically responsive to the form re-
quirements but clearly unrelated to the proposed transaction, most notably information relat-
ing to non-overlapping businesses of the merger parties.
Subsection 16(2) permits merger parties referring to an internet address in their pre-merger
notification filing rather than submitting paper copies of documents. Annual reports and fi-
nancial statements of public companies required to be submitted pursuant to clause
16(1)(c)(iv)(A) is could be submitted in this manner for example. Although this represents a
reasonable attempt by the Bureau to reduce the paper burden on merger parties, caution
should be exercised in doing so where the internet address could change or where the under-
lying information could be taken off-line. Such issues are reasonably likely in complex
cases, where the subsection 123(1) timeframe referred to in subsection 16(2) could last 5
months or more. It would have been preferable had subsection 16(2) referred to paragraph
123(1)(a); that is, only required the internet address to be operational for the initial 30 day
waiting period.
Additional information on merger notification information requirements may be found in
Procedures guide for Notifiable Transactions and Advance Ruling Certificates under the
Competition Act (Ottawa: Competition Bureau, 2010).
353
See also Pre-Merger Notification Interpretation Guideline Number 13: Satisfying the Infor-
mation Requirements set out in Section 16 of the Notifiable Transactions Regulations and
Completeness of Notification.
17. [Repealed SOR/2010-22, s. 10.]
354
Merger Notification Form
Notifiable Transactions*
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* Notifiable Transactions – Form and certificate, (2015-11-05), Innovation, Science and

Economic Development Canada, https://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/
eng/01705.html. Reproduced with the permission of the Minister of Innovation, Science and
Economic Development, 2020. The content of this document may be subject to change or
may be removed from the Government website without notice.
355
356
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357
358
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359
360
Certificate
CERTIFICATE*
Pursuant to sections 116 and 118 of the Competition Act, R.S.C.
1985, c.C-34, as amended (the “Act”);
In the matter of the [insert a description of the proposed trans-
Regulations
action] (the “Proposed Transaction”); and
In the matter of the information supplied by [insert name of

party] to the Commissioner of Competition (the “Commission-
er”) pursuant to 114(1) of the Act on [insert date] in respect of
the Proposed Transaction (the “Notification”);
I, [name of person], of the City of [name of city], in the Province of [name of
province], make oath and swear (or solemnly affirm and declare) as follows:
1. I am [position title] of [name of Company]. I have knowledge of the matters
set out herein and am duly authorized to execute this certificate.
[Note: Where information required by subsection 114(1) is not being supplied on
the basis of subsection 116(1), 116(2) or 116(2.1), include the following applica-
ble paragraphs. Please refer to appropriate section or subsection of the Notifica-
tion when describing the information that has not been supplied.]
2. Pursuant to subsection 116(1) of the Act, the following information has not
been supplied for the following reasons:
a) with respect to section [ ] of the Notification, information relating to
[insert description of omitted information] cannot be supplied because [it
is not known or not reasonably obtainable, of the privilege that exists in
respect of lawyers and notaries and their clients, or it cannot be obtained
without breaching a confidentiality requirement established by law — in-
dicate which circumstance applies and the reason why information has
not been supplied];
b) with respect to section [ ] of the Notification, etc.
3. Pursuant to subsection 116(2) of the Act, the following information has not
been supplied and could not be considered relevant for the following reasons:
[insert description of omitted information] has not been supplied because
it could not, on any reasonable basis, be considered to be relevant to an
* Notifiable Transactions – Certificate, (2015-11-05), Innovation, Science and Economic

Development Canada, https://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03199.
html. Reproduced with the permission of the Minister of Innovation, Science and Economic
Development, 2020. The content of this document may be subject to change or may be
removed from the Government website without notice.
361
Certificate
assessment by the Commissioner as to whether the Proposed Transaction

would or would be likely to prevent or lessen competition substantially
because [insert reason why the information was not considered relevant];
4. Pursuant to subsection 116(2.1) of the Act, the following information has not
been supplied at this time and was previously supplied at the following
time(s):
[insert description of omitted information] has not been supplied because
it has previously been supplied [insert details of when and the matters in
respect of which the information was previously supplied];
5. In accordance with section 118 of the Act, I have examined the information
contained in the Notification which is being supplied to the Commissioner
under subsection 114(1) of the Act and hereby certify that [if information has
not been supplied pursuant to section 116 insert “, except as described
above,”] the information so supplied is, to the best of my knowledge and be-
lief, correct and complete in all material respects and the records supplied are
certified true copies of the original records.
SWORN BEFORE ME, )
[or SOLEMNLY AFFIRMED BEFORE ME], )
at the City of [name of city], )
in the Province of [name of province], )
this [number] day of [month], [year]. )
)
)
................................... ) ..........
A Commissioner, etc. [NAME]
362
COMPETITION TRIBUNAL ACT
An Act to establish the Competition Tribunal and to
amend the Combines Investigation Act and the Bank
Act and other Acts in consequence thereof
R.S.C. 1985, c. 19 (2nd Supp.), as am. SI/91-111; S.C. 1992, c. 1, s. 145
(Sched. VIII, item 5) (Fr.); 1994, c. 24, s. 34(1)(h) (Fr.); 1995, c. 1, s.
Tribunal Act
62(1)(e); 1999, c. 2, ss. 41–43; 2000, c. 15, s. 16; 2002, c. 8, ss. 130,
183(1)(g), 198(c)(iv); 2002, c. 16, ss. 16–19; 2003, c. 22, s. 224(z.19);
2009, c. 2, s. 441; 2014, c. 20, ss. 447, 448.
PART I — COMPETITION TRIBUNAL ACT (SS. 1–17)

Short Title
1. Short Title — This Part may be cited as the Competition Tribunal Act.
Interpretation
2. Definitions — In this Part,
“judicial member” means a member of the Tribunal appointed under para-
graph 3(2)(a);
“lay member” means a member of the Tribunal appointed under paragraph
3(2)(b);
“Minister” means the Minister of Industry;
“Tribunal” means the Competition Tribunal established by subsection 3(1).
1995, c. 1, s. 62(1)(e)
Tribunal Established
3. (1) Tribunal — There is hereby established a tribunal to be known as the
Competition Tribunal.
(2) Constitution of Tribunal — The Tribunal shall consist of
(a) not more than six members to be appointed from among the judges of
the Federal Court by the Governor in Council on the recommendation of
the Minister of Justice; and
363
S. 3(2)(b) Competition Tribunal Act
(b) not more than eight other members to be appointed by the Governor
in Council on the recommendation of the Minister.
(3) Advisory council — The Governor in Council may establish an advi-
sory council to advise the Minister with respect to appointments of lay mem-
bers, which council is to be composed of not more than ten members who are
knowledgeable in economics, industry, commerce or public affairs and may
include, without restricting the generality of the foregoing, individuals chosen
from business communities, the legal community, consumer groups and
labour.
(4) Consultation — The Minister shall consult with any advisory council es-
tablished under subsection (3) before making a recommendation with respect
to the appointment of a lay member.
2002, c. 8, ss. 183(1)(g), 198(c)(iv); 2002, c. 16, s. 16
Case Law
Canada (Commissioner of Competition) v. Superior Propane Inc., 2001 FCA 104 (Fed.
C.A.); leave to appeal refused 2001 CarswellNat 1905 (S.C.C.) — In an appeal from a Com-
petition Tribunal decision, the Federal Court of Appeal considered the Tribunal’s expertise
in order to determine the appropriate standard of review and held that, when appointing lay
members to the Tribunal, the Advisory Council is expected to recommend members to the
Minister that have a similar breadth of experience to the Advisory Council members them-
selves. Members’ fields of expertise do not have to be limited to economics, and their per-
spectives can reflect a variety of industry groups.
293, [1991] R.J.Q. 2534 (C.A.); reversing 47 B.L.R. 154, (sub nom. Alex Couture Inc. v.
Canada (Procureur général)) 69 D.L.R. (4th) 635, 30 C.P.R. (3d) 486, [1990] R.J.Q. 2668
(C.S.); leave to appeal to S.C.C. refused (1992), 91 D.L.R. (4th) vii (note), 42 C.P.R. (3d) v
(note), 141 N.R. 396 (note) (S.C.C.) — In a challenge to the appointment of lay persons to
the Competition Tribunal, it was held that, although the Competition Tribunal exercises
some superior court functions, it is not a superior court as defined in s. 96 of the Constitution
Act, 1867 and, therefore, the provisions found in ss. 97 to 100 of the latter Act relating to the
selection of judges, their terms of office and the setting of their salaries do not apply to the
appointment of Tribunal members. Further, there are adequate provisions in the Competition
Tribunal Act guaranteeing Tribunal lay members tenure, financial security and institutional
independence such that it cannot be said their presence violates constitutional guarantees of
judicial independence and impartiality required by s. 11(d) of the Charter.
(Comp. Trib.) — The Competition Tribunal is validly constituted and not constitutionally
invalid. There is no constitutional requirement that lay members of such a Tribunal be
granted the same security of tenure as judicial members, and there is adequate protection
against bias in the legislation. Nor does concurrent membership of such members on the
Restrictive Trade Practices Commission result in bias. Furthermore, nothing in the Constitu-
tion precludes persons with specialized knowledge other than law from sitting on tribunals.
4. (1) Chairman — The Governor in Council shall designate one of the judi-
cial members to be Chairman of the Tribunal.
364
Part I — Competition Tribunal Act (ss. 1–17) S. 5
(2) Role of Chairman — The Chairman has supervision over and direction
of the work of the Tribunal including, without restricting the generality of the
foregoing, the allocation of the work of the members thereof.
(3) Absence or incapacity — Where the office of Chairman is vacant, or
the Chairman is absent from Canada or is for any reason unable to act, the
powers of the Chairman shall be exercised and the duties performed by the
senior judicial member who is in Canada and is able and willing to act.
5. (1) Tenure of Judicial Members — Each judicial member shall be ap-

pointed for a term not exceeding seven years and holds office so long as he
remains a judge of the Federal Court.
Tribunal Act
(2) Tenure of lay members — Each lay member shall be appointed for a
term not exceeding seven years and holds office during good behaviour but
may be removed by the Governor in Council for cause.
(3) Re-appointment — A member of the Tribunal, on the expiration of a
first or any subsequent term of office, is eligible to be re-appointed for a fur-
ther term.
(4) Acting after expiration of appointment — A person may continue
to act as a member of the Tribunal after the expiration of his term of appoint-
ment in respect of any matter in which he became engaged during the term of
his appointment.
(5) Temporary substitute members — In the event of the absence or in-
capacity of a member of the Tribunal, the Governor in Council may appoint a
temporary substitute member for such period of time as the Governor in
Council prescribes.
Case Law
(Competition Trib.) — The authority granted to members whose term has expired to com-
plete matters in which they became engaged during the term of their appointment, pursuant
to s. 5(4) of the Competition Act, applies whether the expiration is through lapse of time or
resignation.
(note), 141 N.R. 396 (note) (S.C.C.) — The fact that lay members of the Competition Tribu-
nal may be removed only for cause is a sufficient guarantee of tenure that it cannot be said
that they lack the judicial independence required by s. 11(d) of the Charter.
(Comp. Trib.) — See entry under Competition Tribunal Act, s. 3.
365
S. 6(1) Competition Tribunal Act
6. (1) Remuneration of Lay Members — Each lay member shall be paid

such remuneration as may be fixed by the Governor in Council.
(2) Expenses of members — Each member of the Tribunal is entitled to
be paid the travel allowances that a judge is entitled to be paid under the
Judges Act.
(3) Other benefits — Each lay member is deemed to be employed in the
federal public administration for the purposes of the Government Employees
Compensation Act and any regulations made under section 7.7 of the Aeronau-
tics Act.
2003, c. 22, s. 224(z.19)
Case Law
(note), 141 N.R. 396 (note) (S.C.C.) — The fact that the remuneration of lay members of the
Competition Tribunal is set by the Governor in Council would not result in a reasonable
person concluding that they lack the judicial independence and impartiality required by s.
11(d) of the Charter.
7. (1) Oath of Office — Every member of the Tribunal shall, before entering
on the duties of his office, take an oath that he will duly and faithfully, and to
the best of his skill and knowledge, execute the powers and trusts reposed in
him as a member of the Tribunal.
(2) How administered — The oath referred to in subsection (1) shall be ad-
ministered to the Chairman of the Tribunal before the Chief Justice of the
Federal Court, and to the other members by the Chairman, or in his absence
or incapacity, by any other member.
Jurisdiction and Powers of the Tribunal

8. (1) Jurisdiction — The Tribunal has jurisdiction to hear and dispose of
all applications made under Part VII.1 or VIII of the Competition Act and any
related matters, as well as any matter under Part IX of that Act that is the
subject of a reference under subsection 124.2(2) of that Act.
(2) Powers — The Tribunal has, with respect to the attendance, swearing
and examination of witnesses, the production and inspection of documents, the
enforcement of its orders and other matters necessary or proper for the due
exercise of its jurisdiction, all such powers, rights and privileges as are vested
in a superior court of record.
366
(3) Power to penalize — No person shall be punished for contempt of the

Tribunal unless a judicial member is of the opinion that the finding of con-
tempt and the punishment are appropriate in the circumstances.
1999, c. 2, s. 41; 2002, c. 16, s. 16.1
Commentary
Subsection 8(1) confers upon the Competition Tribunal the jurisdiction over Parts VII.1 and
VIII under the Act and subsection 8(2) confirms that the powers of the Tribunal are similar
to those of a court.
Subsection 8(3) codifies that Tribunal’s contempt power for breaches of its orders. To estab-
lish contempt of a Tribunal order, the party alleging contempt must prove the following
elements beyond a reasonable doubt: (1) the existence of an order; (2) that the alleged con-
Tribunal Act
temnor had knowledge of the order; and (3) knowing disobedience of the order: see Louis
Vuitton Malletier S.A. v. Bags O’Fun Inc. (2003), 242 F.T.R. 75 (F.C. T.D.). The particular
context in which an order was issued and the intent and spirit of an order must be considered
in determining non-compliance. Where an order is unclear, ambiguity should be resolved to
the benefit of the alleged contemnor.
A defence to contempt is available for an order that is impossible to perform. However, this
defence is not available where the contemnor’s own conduct has produced this result.
Case Law
The Commissioner of Competition v. HarperCollins Publishers LLC and HarperCollins
Canada Limited, 2017 Comp. Trib. 10 (Competition Trib.) — HarperCollins sought an order
to dismiss the application brought against it by the Commissioner under s. 90.1. HarperCol-
lins claimed that the Tribunal lacks the jurisdiction to grant the relief requested by the Com-
missioner, because the alleged conduct forming the basis of the application occurred in the
United States. HarperCollins further claimed that the conduct in question no longer existed,
because it was resolved by courts and antitrust enforcers in the United States in 2012-2013.
The motion was dismissed. The Tribunal held that a motion for summary dismissal for lack
of jurisdiction will only be granted if it is “plain and obvious” that the Tribunal does not
have jurisdiction. The Tribunal was not satisfied that the Commissioner’s allegations could
not be supported or that the application was bereft of all possibility of success and certain to
fail. Accepting the facts and allegations as pleaded, the Tribunal determined that a “real and
substantial connection” could well be established between the subject-matter of the applica-
tion and Canada, sufficient to provide the Tribunal with jurisdiction. It further concluded that
it was not plain and obvious that the alleged arrangement no longer exists in Canada.
Nadeau Ferme Avicole Ltée v. Groupe Westco Inc., 2010 Comp. Trib. 2, 2010 CarswellNat
2822, 2010 Comp. Trib. 15 (Competition Trib.); affirmed 2011 CarswellNat 770, 2011 FCA
106 (Fed. C.A.) — The Tribunal had ordered the respondent to supply the applicant with
chickens pending consideration of its section 75 application. The respondent argued that it
had been supplying fewer, but larger, chickens than required under the terms of the interim
order and that the interim order was impossible to perform. The respondent was held in
contempt. The Tribunal was not satisfied that the weight of the larger chickens was compen-
sation for the shortfall in terms of numbers of chickens delivered. The Tribunal was also not
persuaded that the interim order was impossible to perform given that the respondent had
made a business decision to produce larger chickens. On appeal, the court concluded that the
respondent had taken it upon itself to change the interim order’s terms so that it could pursue
an alternative business plan. The court affirmed the Tribunal’s conclusion that the terms of
367
S. 8 Competition Tribunal Act
the interim order were clear and were deliberately breached by the respondent. The appeal
was dismissed.
At sentencing, in addition to seeking a fine against the respondent, the applicant sought resti-
tution for business losses attributable to the respondent’s conduct. The applicant asserted that
the Tribunal had broad discretion to determine the appropriate penalty in a contempt pro-
ceeding, including granting a remedy of a civil nature, and that civil contempt bears the
imprint of criminal law and that any criminal sanction, such as restitution, is also available to
the Tribunal. The Tribunal rejected the applicants claims for restitution, stressing that the
objective in civil contempt proceedings is ensuring compliance with Tribunal orders and that
the proceedings are not a means for a party to pursue indemnification claims. Any claims for
losses incurred by the applicant as a result of the respondent’s breach of the Tribunal’s in-
terim order should be pursued under section 36(b), and the Tribunal is not a court of compe-
tent jurisdiction under section 36. With respect to the fine, the Tribunal applied the sentenc-
ing factors outlined in Minister of National Revenue v. Marshall, 2006 FC 788, 2006
CarswellNat 1706 (F.C.), concluding, among other things, that (i) the respondent’s ultimate
success in the main section 75 proceeding had no bearing on the penalty to be imposed for
contempt of the interim order, (ii) the respondent had not acted with the bona fide belief that
its conduct did not constitute a breach of the order and (iii) the respondent had breached the
order for financial gain. The Tribunal assessed a $75,000 fine against the respondent.
Symbol Technologies Canada ULC v. Barcode Systems Inc. (2005), 43 C.P.R. (4th) 291
(Competition Trib.) — The respondent obtained leave of the Tribunal to apply for an order
under s. 75 (refusal to deal) of the Act. The respondent alleged that the applicant had refused
to sell its barcode scanners to the respondent, which the respondent had previously distrib-
uted in Western Canada for a ten-year period. The Tribunal’s order granting leave was
stayed pending an appeal to the Federal Court of Appeal, which was dismissed. Before leave
was granted, an interim receiver was appointed for the assets and undertakings of the respon-
dent. The interim receiver subsequently sold the assets of the respondent. The applicant ap-
plied pursuant to s. 106 of the Act for an order rescinding the order granting leave. It was the
position of the applicant that the Tribunal would not have granted leave had the respondent’s
assets and business been sold when leave was sought. The applicant moved pursuant to s. 9
of the Competition Tribunal Act for summary disposition of the application for a rescission
order. The motion and the s. 106 application were granted as the respondent only existed as a
shell corporation, and had never previously applied to lift the stay of proceedings. Moreover,
the respondent had never applied for an interim order to maintain supply, as it was out of
business. With the change in circumstances since the leave was granted, and in the circum-
stances which existed when the applicant filed its s. 106 application, leave would not have
been granted.
B-Filer Inc. v. Bank of Nova Scotia (2005), 43 C.P.R. (4th) 37 (Competition Trib.) — The
applicants filed an application before the Tribunal pursuant to s. 103.1 of the Competition
Act for leave to apply to the Tribunal under s. 75 (refusal to deal) and s. 77 (exclusive deal-
ing) of the Act, and for interim relief under s. s. 104 of the Act. The applicants had also
commenced proceedings before the Alberta Court of Queen’s Bench based on breach of
contract and unlawful interference with economic interests. The Alberta court dismissed the
application for injunctive relief. The respondents moved pursuant to s. 9 of the Competition
Tribunal Act for summary disposition of the application for leave to apply to the Tribunal on
the basis of res judicata, issue estoppel, and that to continue the proceedings would be an
abuse of process. The motion was dismissed. In rendering its decision, the Alberta court did
not determine whether the Competition Act applied, and drew a distinction between general
contract law and competition law. The issues before the Tribunal were not the same as the
368
issues before the Alberta court. It was not an abuse of process for the applicants to seek
redress before the Tribunal as the Tribunal had exclusive jurisdiction to apply ss. 75 and 77
of the Act.
United Grain Growers Ltd. v. Canada (Commissioner of Competition) (2005), 43 C.P.R.
(4th) 343 (Competition Trib.) — The applicant and the Commissioner entered into a consent
agreement to resolve the Commissioner’s concerns regarding competition in the market for
the provision of port terminal grain handling services in the Port of Vancouver. The consent
agreement provided that the applicant was to divest its interest in a Vancouver terminal by a
certain date, following which a trustee would be appointed to complete the divestiture. After
extending the sale period on eleven occasions, the applicant sought a twelfth extension, but
the Commissioner refused. The applicant then applied to the Tribunal under s. 106 of the Act
for an order rescinding the consent agreement. The applicant submitted that independent
grain companies were able to secure port terminal grain handling services in the Port of
Tribunal Act
Vancouver at competitive rates. A farmer-controlled marketing organization was successful
in requesting leave to intervene in the proceedings before the Tribunal. The organization and
is member producers were directly impacted by the issues of whether or not the consent
agreement would be rescinded, and whether or not the divestiture occurred. The organization
was in a unique position to make original representations relating to whether or not changed
circumstances meant that the consent agreement should no longer be maintained.
Canada (Commissioner of Competition) v. Abitibi-Consolidated Inc. (2002), 2002 Comp.
Trib. 3 (Competition Trib.) — Following the acquisition of a competitor, Abitibi agreed to
an undertaking to resolve the Commissioner’s concerns respecting the merger. The undertak-
ing provided for the divestiture of a mill within one year after which the Commissioner
could appoint an independent agent. The parties also agreed that the Commissioner would
have the option to seek a consent order of the Tribunal under s. 105 of the Act. Disputes had
arisen between the parties, and the Commissioner applied for a consent order. The Commis-
sioner brought a motion for directions relating to the proper procedure to resolve the disputes
that had arisen between the parties with respect to the sale of the mill. The Commissioner
relied upon s. 105 of the Act, and s. 8 of the Competition Tribunal Act. The Tribunal did not
have jurisdiction to review undertakings. The Tribunal concluded that there was not a proper
consent order application before it as Abitibi had not consented to the particular order. The
consent to the undertaking did not constitute consent to a particular draft consent order, and
therefore, the consent order was not a consent order within the meaning of the undertaking.
As a result, the Tribunal did not have jurisdiction to deal with the matters related to the
application.
Tremblay c. Acier Leroux inc., 2003 CarswellQue 1876, [2003] J.Q. No. 9385 (C.S. Que.);
affirmed 2004 CarswellQue 449 (C.A. Que.); affirmed 2004 CarswellQue 450 (C.A. Que.);
affirmed 2004 CarswellQue 461 (C.A. Que.) — A party to an arbitration moved to reject the
arbitrator’s jurisdiction on the basis that the Competition Tribunal has exclusive jurisdiction
over competition issues. The Court ruled that section 8 of the Competition Tribunal Act —
and section 36 of the Competition Act — do not operate to make the Competition Tribunal
the exclusive forum for the determination of competition issues.
Canada (Commissioner of Competition) v. Air Canada (2002), 19 C.P.R. (4th) 226 (Compe-
tition Trib.) — The Commissioner brought an application alleging abuse of dominant posi-
tion by Air Canada. The Commissioner alleged that Air Canada had responded to the entry
of two airlines on routes in eastern Canada by increasing capacity and/or decreasing fares in
a manner that did not cover the avoidable costs of operating the flights on the affected
routes. The hearing commenced with a number of preliminary questions, which had taken
61/2 days. The matter was then adjourned, and it was to reconvene in April, 2002. Due to the
369
illness of a panel member, the hearing was not expected to recommence until September,
2002. The Commissioner moved for an order providing that the panel should be reconsti-
tuted with another judicial member in order that the case be heard expeditiously. The Com-
missioner relied, inter alia, upon s. 8(2) of the Competition Tribunal Act. The motion was
dismissed. The premature removal of a judge seized of a case raised serious concerns regard-
ing judicial independence. The reconstituting of a new panel was an extreme measure which
should only be resorted to in compelling circumstances, and when the anticipated delay
clearly outweighed the prejudice to the parties, and the potential damage to the perception of
judicial independence.
Canada (Commissioner of Competition) v. Air Canada (2002), 2002 CarswellNat 4018, 19
C.P.R. (4th) 226, 2002 Comp. Trib. 15 (Competition Trib.) — The Commissioner’s first ap-
plication to reconstitute the panel due to the illness of a panel member was dismissed. Subse-
quently, the parties were advised that the judicial member would not be available to recom-
mence the hearing on the anticipated date. As a result, the Commissioner moved again to
reconstitute the panel, and sought other relief relating to extending time periods. With re-
spect to constituting a new panel, given the consent of the respondent, and considering ss.
8(2), 9(2), and 10(2) of the Competition Tribunal Act, the Tribunal held that it was appropri-
ate to order the termination of the hearing before the seized Tribunal panel, and to appoint a
new panel. The Tribunal further concluded that it would not amend the questions and issues
referred to the Tribunal as part of the preliminary questions prior to the adjournment. The
Tribunal did order Air Canada to produce certain information requested by the Commis-
sioner, which extended beyond the time period covered at the hearing of the preliminary
questions. Air Canada had obtained the adjournment on the basis that intervening events had
changed matters relevant to the issue of avoidable costs, and it required more time to assess
the effects of such change.
Canada (Commissioner of Competition) v. Trilogy Retail Enterprises L.P. (2001), 2001
Comp. Trib. 29, 14 C.P.R. (4th) 216 (Competition Trib.) — The Commissioner applied for a
consent order in respect of an acquisition and a proposed merger of two bookselling compa-
nies. The basis of the application was that the acquisition and proposed merger would likely
prevent or lessen competition substantially in the distribution of trade books nationally and
locally. The parties submitted a draft consent order requiring the divestiture of certain stores,
and certain online services. An intervener argued that a prospective purchaser required a
critical mass of stores to compete effectively against the merged entity. The consent order
was issued as the Tribunal was satisfied that the order would, in all likelihood, eliminate the
substantial lessening of competition presumed to arise from the merger. There was no evi-
dence to support the intervener’s position that more superstores were required in the divesti-
ture package to create a critical mass of stores. Although the consent order contained an
arbitration mechanism to resolve disputes, the Tribunal was not thereby waiving or aban-
doning its jurisdiction to enforce the order pursuant to s. 8 of the Act. The arbitration proce-
dures related only to disputes arising from the code of conduct, which provided for ceilings
on the terms of contracts with book suppliers. If the code of conduct was not complied with,
it could amount to a breach of the Tribunal’s order and be subject to contempt proceedings.
(3d) 55 (Competition Trib.) — The Director’s application sought to review the acquisition of
a company by the respondent. Prior to the application, the National Transportation Agency
had reviewed the same merger and had determined that the merger was not contrary to the
public interest. The respondent pleaded that the Director’s application was an abuse of pro-
cess in light of the prior determination by the Agency. The Director brought a motion to
strike out these pleadings as the Tribunal had no jurisdiction to examine whether its conduct
370
Part I — Competition Tribunal Act (ss. 1–17) S. 8.1(5)
constituted abuse of process. The motion was granted in part. Section 8(1) accorded to the
Tribunal jurisdiction to govern its own process, and implicit in this is the power of the Tribu-
nal to ensure that its process was not undermined through the Director’s conduct of his in-
quiries. The Tribunal had jurisdiction to deal with allegations that the Director’s conduct of
inquiry had led to an abuse of Tribunal process. The Director’s persistence in his inquiry
after the Agency’s decision, and the use of the Director’s powers under s. 11, in addition to
discovery procedures, did not constitute an abuse of process.
Chrysler Canada Ltd. v. Canada (Competition Tribunal), [1992] 2 S.C.R. 394, 12 Admin.
L.R. (2d) 1, 7 B.L.R. (2d) 1, 42 C.P.R. (3d) 353, 92 D.L.R. (4th) 609; reversing [1990] 2
F.C. 565, 48 B.L.R. 125, 31 C.P.R. (3d) 510, 111 N.R. 368 (C.A.) — The powers granted to
the Tribunal by s. 8 of the Act includes the power to punish for contempt those who fail to
comply with its orders under Part VIII of the Competition Act.
Canada (Director of Investigation & Research) v. Chrysler Canada Ltd. (1992), 44 C.P.R.
Tribunal Act
(3d) 430 (Competition Trib.) — The Competition Tribunal ordered the respondents to accept
the intervenor as a customer for supply of automobile parts on trade terms usual and custom-
ary to its relationship with him prior to a specified date. The intervenor alleged that the
Canadian supplier was deliberately slow and uncooperative with his orders and attempted to
change the terms. The intervenor also alleged that the American respondents were exerting
pressure on him by reason of the litigation in refusing to supply parts. The Director brought a
motion for a “show cause” order requiring the respondents to show cause why they should
not be held in contempt.
The Tribunal held that the affidavit evidence before it must show a prime facie breach of the
order. Since it did not, the motion for a show cause order was denied.
8.1 (1) Costs — The Tribunal may award costs of proceedings before it in
respect of reviewable matters under Parts VII.1 and VIII of the Competition
Act on a final or interim basis, in accordance with the provisions governing
costs in the Federal Court Rules, 1998.
(2) Payment — The Tribunal may direct by whom and to whom any costs
are to be paid and by whom they are to be taxed and allowed.
(3) Award against the Crown — The Tribunal may award costs against
Her Majesty in right of Canada.
(4) Costs adjudged to Her Majesty in right of Canada — Costs ad-
judged to Her Majesty in right of Canada shall not be disallowed or reduced
on taxation by reason only that counsel who earned the costs, or in respect of
whose services the costs are charged, was a salaried officer of Her Majesty in
right of Canada performing those services in the discharge of that counsel’s
duty and remunerated for those services by salary, or for that or any other
reason was not entitled to recover any costs from Her Majesty in right of Can-
ada in respect of the services so rendered.
(5) Amounts to Receiver General — Any money or costs awarded to Her
Majesty in right of Canada in a proceeding in respect of which this section
applies shall be paid to the Receiver General.
2002, c. 16, s. 17
371
S. 8.1 Competition Tribunal Act
Commentary
This section provides the Tribunal with the authority to award costs, on a final or interim
basis, in proceedings under Part VII.I (Deceptive Marketing Practices) and Part VIII (Mat-
ters Reviewable by the Tribunal) in accordance with the provisions governing costs in the
Federal Court Rules, 1998 (s. 8.1(1)). Where the Tribunal is of the view that litigants are
engaging in proceedings that are frivolous or vexatious and designed to hinder or delay the
progress of a proceeding, it could award costs against the offending party. The Tribunal may
also award costs against the Crown (s. 8.1(3)). Where costs are awarded to the Government
of Canada, the assessment or taxation is not to be reduced by reason only that the counsel
involved were salaried employees of the Government (s. 8.1(4)).
9. (1) Court of Record — The Tribunal is a court of record and shall have
an official seal which shall be judicially noticed.
(2) Proceedings — All proceedings before the Tribunal shall be dealt with
as informally and expeditiously as the circumstances and considerations of
fairness permit.
(3) Interventions by persons affected — Any person may, with leave of
the Tribunal, intervene in any proceedings before the Tribunal, other than
proceedings under Part VII.1 of the Competition Act, to make representations
relevant to those proceedings in respect of any matter that affects that person.
(4) Summary dispositions — On a motion from a party to an application
made under Part VII.1 or VIII of the Competition Act, a judicial member may
hear and determine the application in a summary way, in accordance with any
rules on summary dispositions.
(5) Decision — The judicial member may dismiss the application in whole or
in part if the member finds that there is no genuine basis for it. The member
may allow the application in whole or in part if satisfied that there is no genu-
ine basis for the response to it.
1999, c. 2, s. 42; 2002, c. 16, s. 18
Commentary
The Tribunal has been given powers similar to those of the Federal Court and provincial
superior courts to dispose of matters summarily without the need for a trial (s. 9(4)). Sum-
mary disposition matters may be dealt with by a single judicial member of the Tribunal. An
application may be dismissed in whole or in part if the member finds that there is “no genu-
ine basis” for the application. Similarly, the application may be allowed in whole or in part if
the member is satisfied that there is no genuine basis for the response to the application (s.
9(5)).
Subsection (3)
While a person affected by the proceedings may “intervene” in proceedings before the Tri-
bunal, only the Commissioner may initiate proceedings in respect of a reviewable practice.
Thus persons who feel victimized by a practice must complain to the Commissioner, who
has the ultimate authority to initiate proceedings to have a practice stopped. Affected parties
may include, in addition to those victimized by a practice, those sought to be made subject to
372
an order. In Canada (Dir. of Investigation & Research) v. Air Can., (sub nom. American
Airlines Inc. v. Canada (Competition Tribunal)) [1989] 1 S.C.R. 236, 23 C.P.R. (3d) 178n,
92 N.R. 320, 26 C.P.R. (3d) 95, the Tribunal was held to have inherent jurisdiction to allow
intervenors to call evidence and cross-examine.
Case Law
Commissioner of Competition v. HarperCollins Publishers LLC, 2017 Comp. Trib. 5 (Com-
petition Trib.) — The applicant, Rakuten Kobo sought leave to intervene in a proceeding
brought by the Commissioner under s. 90.1 against HarperCollins. Kobo sought to intervene
on three topics, and was supported by HarperCollins. The Commissioner generally con-
sented to Kobo’s appearance as an intervener, but opposed its being permitted to make argu-
ments as to whether the Tribunal has jurisdiction to determine a case under s. 90.1, on the
ground that it would unnecessarily lengthen the proceedings. The Tribunal allowed Kobo to
Tribunal Act
intervene on all topics, including that which the Commissioner opposed, accepting Kobo’s
argument that it would bring a unique perspective. The Tribunal determined that the Com-
missioner’s concerns could be dealt with by limiting Kobo’s submissions to “non-repetitive”
submissions on the topic.
Commissioner of Competition v. Direct Energy Marketing Ltd., 2013 Comp. Trib. 16 (Com-
petition Trib.) — National Energy Corporation, a supplier of natural gas and electric water
heaters, sought leave to intervene in two similar proceedings filed on the same day on abuse
of dominance. In granting leave, with certain adjustments on topics and terms, the Tribunal
determined that neither section 9(3) or the case law provide that intervener status can only be
granted to persons who establish their evidence cannot be presented by the party whose posi-
tion they support. The Tribunal also refused to place an arbitrary limit on the number of
experts National could bring, stating however that it should be guided by the principles in
9(2).
Commissioner of Competition v. Visa Canada Corp., 2011 Comp. Trib. 2 (Competition
Trib.) — In the context of an application brought by the Commissioner concerning fees paid
by merchants for the ability to accept Visa and MasterCard purchases, TD Bank and the
Canadian Bankers Association, in their capacity as issuers, sought leave to intervene on the
basis that the Commissioner’s application may adversely affect their banking businesses.
The Tribunal declined to apply the reasoning in Canada (Commissioner of Competition) v.
Burns Lake Native Development Corp., 2006 Comp. Trib. 16 (Competition Trib.) holding
that parties must show direct impact as the context for intervenor status under section 9(3)
allows for some degree of speculation as to the impacts that applicants may suffer. The Tri-
bunal also held that proposed intervenors could not expand the hearing to subjects that are
not alleged.
United Grain Growers Ltd. v. Canada (Commissioner of Competition), 2006 Comp. Trib. 25
(Competition Trib.) — United Grain and the Commissioner of Competition entered into a
consent agreement which United Grain then sought to rescind on the basis that its circum-
stances had changed. During proceedings, United Grain moved to adjourn and the Commis-
sioner filed a motion for the summary disposition of United Grain’s application to rescind
the consent agreement. The Tribunal held that summary disposition is a pre-hearing proce-
dure and thus an application under 9(4) cannot be brought after the commencement of a
hearing, an interpretation that is in accord with the Federal Court Rules, which apply when
the Competition Tribunal Rules are silent on an issue.
Note: In subsequent proceedings, the Commissioner refused to grant the application to ad-
journ proceedings, holding that it violated section 9(2)’s objectives of efficiency.
373
Canada (Commissioner of Competition) v. P.V.I. International Inc., 2004 FCA 197

(F.C.A.) — Following its finding that appellants had engaged in reviewable conduct, the
Competition Tribunal issued orders preventing them from repeating the misrepresentations
leading to the orders and imposing an administrative monetary penalty. Appellants — unrep-
resented at the hearing for the appeal — raised issues relating to the alleged lack of eviden-
tiary support for the Tribunal’s findings and its allegedly unfair procedure. The Court held
that the Tribunal has wide discretion over its procedure and that its decisions relating to
procedure had been made within that discretion, in the interest of striking a balance between
fairness and expeditiousness.
Canada (Commissioner of Competition) v. United Grain Growers Ltd. (2002), 19 C.P.R.
(4th) 157 (Competition Trib.) — Following the acquisition by the respondent of Agricor, the
Commissioner filed an application requiring that the respondent divest, at its option, its inter-
est in one of two grain terminals. The respondent submitted that divestiture of part of a
terminal would remedy the substantial lessening of competition. A farmer-controlled market-
ing organization successfully moved for leave to intervene. The test for granting intervenor
status as set out in s. 9(3) of the Competition Tribunal Act must be met. The elements of that
test are: (a) the matter alleged to affect the person seeking leave to intervene must be legiti-
mately within the scope of the Tribunal’s consideration; (b) the person seeking leave to inter-
vene must be directly affected; (c) all representations made by a person seeking leave to
intervene must be relevant to an issue specifically raised by the Commissioner; and (d) the
person seeking leave to intervene must bring to the Tribunal a unique or distinct perspective
that will assist the Tribunal in deciding the issues before it. The marketing organization’s
involvement in the grain industry with producers placed it in a unique position to assist the
Tribunal in considering the effectiveness of the remedies proposed.
Astral Média Inc. c. Canada (Commissaire de la concurrence) (2002), (sub nom. Astral
Media Inc. v. Canada (Commissioner of Competition)) 20 C.P.R. (4th) 356 (Fed. T.D.) —
Astral proposed to acquire control of the broadcasting enterprises of Télémédia. The Com-
missioner initiated an inquiry into the proposed transaction pursuant to s. 10(1)(b) of the
Competition Act. Both Astral and Télémédia applied to the Federal Court asking it to rule
that the Act did not apply to the proposed transaction. The Canadian Association of Broad-
casters brought a motion seeking leave to intervene. In dismissing the motion, the court was
not satisfied that the outcome of the application would seriously affect the Association’s
rights or financial interests. Furthermore, the Association did not discharge its burden of
establishing that its intervention would assist in the making of a decision on any fact or law
relating to the case.
8(2), 9(2), and 10(2) of the Competition Tribunal Act, the Tribunal held that it was appropri-
ate to order the termination of the hearing before the seized Tribunal panel, and to appoint a
new panel. The Tribunal further concluded that it would not amend the questions and issues
referred to the Tribunal as part of the preliminary questions prior to the adjournment. The
Tribunal did order Air Canada to produce certain information requested by the Commis-
sioner, which extended beyond the time period covered at the hearing of the preliminary
questions. Air Canada had obtained the adjournment on the basis that intervening events had
374
changed matters relevant to the issue of avoidable costs, and it required more time to assess
the effects of such change.
Canada (Commissioner of Competition) v. Air Canada (April 20, 2001), Trib. Dec. No.
CT2001/002/008 (Competition Trib.) — The Commissioner applied under s. 79 of the Com-
petition Act for an order prohibiting the respondent from engaging in anti-competitive prac-
tices directed against low cost carriers such as Westjet Airlines. Westjet applied for inter-
venor status in the proceedings which application was opposed by the respondent on the
basis that Westjet had failed to articulate the issues in which it seeks leave to intervene.
Westjet was granted leave to intervene as it satisfied the test stated in s. 9(3) of the Competi-
tion Tribunal Act. Westjet was directly affected by the alleged anti-competitive practices,
and had a unique perspective on the issues that would be before the Tribunal. Westjet’s
participation was limited to the issues that met the requirements of s. 9(3) such as the respon-
dent’s dominant position, the substantial lessening of competition as it relates to Westjet, and
Tribunal Act
the issue of avoidable costs.
Canada (Commissioner of Competition) v. Trilogy Enterprises L.P. (May 17, 2001), Trib.
Dec. No. CT2001/003/023 (Competition Trib.) — The Commissioner brought an application
pursuant to ss. 92 and 105 of the Competition Act for a consent order directing the divestiture
of certain assets. Two members of a group of investors, that was considering whether to
make a bid for the assets, applied for leave to intervene in the proceedings. The Tribunal
granted them intervenor status as the investors demonstrated that as potential bidders they
were directly affected by the divestiture consent order. The investors expressed serious con-
cerns with respect to the ability of a prospective purchaser of the listed assets to compete
effectively against the new entity. These concerns were relevant in determining the effective-
ness of the proposed remedy in restoring competition to the level that existed prior to the
acquisition.
(3d) 37 (Competition Trib.) — The Director challenged a merger of the respondent and a
company alleging a substantial lessening of competition in shipping services through the
Port of Montreal. Newfoundland Capital Corp. sought leave to intervene as the it was willing
to purchase the company as a competitor to the respondent. The Director provided additional
grounds in support of the request to intervene. At the time of its submissions, the intervenor
sought to rely upon the reasons and supporting material filed by the Director. The applica-
tion for intervention was dismissed. Only the grounds proposed by the intervenor may be
considered. The assertion by the intervenor that it was a competitively preferable purchaser
was not a sufficient basis for intervention. The application by the Port of Montreal to inter-
vene was allowed as its efficiency and competitiveness were at issue in the proceeding.
(3d) 167 (Competition Trib.) — The applicant sought to intervene in merger review proceed-
ings before the Tribunal in order to make representations concerning the confidentiality of
documents provided to the Director. The Director listed the documents obtained from the
applicant in its affidavit of documents. Documents provided to the Director under s. 11 pro-
cess have severely diminished or exhausted any privacy right that previously existed in busi-
ness records. Although there was no basis for intervenor status, the Tribunal may grant per-
mission to a third party to make submissions concerning document confidentiality.
Southam Inc. v. Canada (Director of Investigation & Research) (1997), 78 C.P.R. (3d) 315
(Competition Trib.) — The respondents to a merger review proceedings were ordered to
divest certain assets. Subsequently, they filed an application to vary the divestiture order to
permit sale of the assets to a specific individual. In the context of the variation application,
the parties and the Director both requested leave to amend pleadings. The individual who
375
intended to purchase the assets to be divested sought leave to intervene in the proceedings.
The application to intervene was dismissed. Although the proposed intervenor was directly
affected by the proceedings if the application to vary the divestiture order was successful, the
interests of the intervenor and the applicants in the main proceeding were entirely the same.
Washington v. Canada (Director of Investigation & Research) (1998), 78 C.P.R. (3d) 479
(Competition Trib.) — A prior application of the Director concerning a merger resulted in a
consent order requiring the divestiture of certain assets. The original respondents to the di-
vestiture order and the Director brought a consent variation application dispensing with the
divestiture package due to the entry of a new effective competitor in the market. A prospec-
tive purchaser of the divestiture package sought leave to intervene in the consent variation
proceedings. Leave to intervene was denied as the Tribunal was not satisfied that the inter-
venor would bring a unique or distinct perspective of the subject-matter in dispute. Although
the Director had consented to the variation, it did not create an evidentiary void as the Direc-
tor still retained responsibility to represent the public interest and investigate the proposed
variation.
(Competition Trib.) — A tribunal may grant intervenor status to a party pursuant to s. 9(3) of
the Act only if the party is directly affected by the proceedings.
Canada (Director of Investigation & Research) v. Imperial Oil (1990), 31 C.P.R. (3d) 277
(Competition Trib.); affirmed (1992), 41 C.P.R. (3d) 493 (Fed. C.A.) — The applicant
sought to intervene pursuant to s. 9(3) of the Competition Tribunal Act in proceedings in
which a consent order had been approved pursuant to s. 105 of the Competition Act, an order
which was under appeal in the Federal Court of Appeal. While the Tribunal may pursuant to
s. 106 alter such an order, it may do so only “on application by the Director or a person
against whom an order has been made”. Even if the applicant were such a person, the proper
course of action would be to seek to be added as a party to the existing appeal. Furthermore,
s. 106 operates only where there has been a change in circumstances. That one of the parties
to the consent order may have misled the applicants concerning the terms of the order does
not constitute such a change. The facts also did not support the contention that there had
been fraud on the Tribunal. Finally, if the Tribunal erred in not giving notice to the appli-
cants of the consent order hearings the remedy would be in the Court of Appeal by joinder in
the appeal or application under s. 28 of the Federal Court Act.
(Fed. C.A.) — The Director brought proceedings before the Competition Tribunal against
NutraSweet, a major producer of aspartame. A rival producer sought and was granted inter-
venor status. An appeal from this decision was dismissed. The intervenor was a person af-
fected by the matter before the Tribunal. It had not been demonstrated that the Tribunal erred
in principle in the exercise of its discretion to grant such status. A request by the intervenor
for the costs of the appeal was refused.
Canada (Dir. of Investigation & Research) v. Air Can. (1989), 37 Admin. L.R. 95, 24 C.P.R.
(3d) 29 (Comp. Trib.) — One basic tenet of litigation is that the litigation belongs to the
parties and accordingly the speed of litigation is determined by counsel. However, one of the
major concerns of the Tribunal and the rules drafted for its operation was to provide an
expeditious means of dealing with applications for review of mergers. Hence, when prepara-
tion for the hearing of such an application has been proceeding very slowly, lack of prepara-
tion is not a sufficient excuse for delaying the commencement of the hearing.
Air Canada v. American Airlines Inc. (1989), 26 C.P.R. (3d) 575 (S.C.C.) — The Supreme
Court of Canada ordered the Tribunal not to hear expert evidence from intervenors, entertain
376
Part I — Competition Tribunal Act (ss. 1–17) S. 11(2)
applications from intervenors, re direct evidence or cross-examination, or otherwise deal

with the role of intervenors pending disposition of the appeal in the matter by the Court (see
entry under this section Canada (Dir. of Investigation & Research) v. Air Canada, infra.).
Canada (Dir. of Investigation & Research) v. Air Can. (1988), [1989] 2 F.C. 88, 33 Admin.
L.R. 229, 23 C.P.R. (3d) 178, (sub nom. American Airlines Inc. v. Canada (Competition
Trib.)) 89 N.R. 241, 54 D.L.R. (4th) 741 (C.A.); affirmed [1989] 1 S.C.R. 236, 26 C.P.R. 95,
92 N.R. 320, 23 C.P.R. (3d) 178n — Courts and tribunals have inherent power to permit
interventions on such terms and conditions as they believe appropriate in the circumstances,
subject to any clearly expressed legislative restriction on such power. Such inherent author-
ity is reinforced for the Competition Tribunal by s. 8(2) of the Competition Tribunal Act
which equates the Tribunal with a superior court of record with respect to the control of its
process. In this context s. 9(2) does not provide an express limitation on the Tribunal’s dis-
cretion to permit participation by intervenors or to determine the nature of such participation.
Tribunal Act
Comm.) — An intervenor does not automatically or necessarily acquire a standing identical
and/or equal to the parties in the proceeding and conditions may be attached when intervenor
status is granted. In a tied selling matter an order may issue which binds not only the defen-
dant but also its competitors, and hence it would be logical to hear from such competitors
and permit them intervenor status.
Organization of Work
10. (1) Sittings of Tribunal — Subject to section 11, every application to
the Tribunal shall be heard before not less than three or more than five mem-
bers sitting together, at least one of whom is a judicial member and at least
one of whom is a lay member.
(2) Judicial member to preside at hearings — The Chairman shall
designate a judicial member to preside at any hearing or, if the Chairman is
present at a hearing, may preside himself.
(3) Prohibition where financial interest — No member shall take part
in any matter before the Tribunal in which the member has a direct or indi-
rect financial interest.
11. (1) Hearing of applications — The Chairman of the Tribunal, sitting

alone, or a judicial member designated by the Chairman, sitting alone, may
hear and dispose of applications under subsection 100(1), section 103.1 or
103.3 or subsection 104(1) or 123.1(1) of the Competition Act and any related
matters.
(2) Administrative remedies — Applications for orders under Part VII.1
of the Competition Act and any related matters shall be heard and disposed of
by the Chairman of the Tribunal, sitting alone, or by a judicial member desig-
nated by the Chairman, sitting alone.
1999, c. 2, s. 43; 2000, c. 15, s. 16; 2002, c. 16, s. 19; 2009, c. 2, s. 441
377
Case Law
Used Car Dealers Assn. of Ontario v. Insurance Bureau of Canada, 2012 Comp. Trib. 1
(Competition Trib.) — The Tribunal issued an interlocutory order under section 106 of the
Competition Act which the Insurance Bureau sought to rescind. The Tribunal informed par-
ties that the application could be refiled as a motion for relief under section 104 of the Com-
petition Act to be heard by a judicial member sitting alone pursuant to section 11 of the
Competition Tribunal Act. The Used Car Dealers Association objected on the basis that “re-
lated matter” could only refer to matters arising under the initial section 104 proceedings and
that the Tribunal should therefore proceed under section 106, which would require it to give
notice to the public, deal with intervenors and sit a three-member panel. The Tribunal re-
jected this objection as unsupported by the Competition Tribunal Act and cumbersome.
Air Canada v. Canada (Commissioner of Competition), 2002 FCA 121 (Fed. C.A.); leave to
appeal refused 2002 CarswellNat 3657 (S.C.C.) — In the context of an application that was
held before a single judicial member of the Tribunal under section 11(1), the court held that
the words “and any related matter” in section 11(1) could not extend the Tribunal’s jurisdic-
tion to determine whether an order issued by the Commissioner was statutorily authorized
when the Tribunal does not have this jurisdiction when normally constituted under section
8(1).
Proceedings
12. (1) Questions of Law, Fact, Mixed Law and Fact — In any pro-
ceedings before the Tribunal,
(a) questions of law shall be determined only by the judicial members sit-
ting in those proceedings; and
(b) questions of fact or mixed law and fact shall be determined by all the
members sitting in those proceedings.
(2) Where there are differing opinions — In any proceedings before the
Tribunal,
(a) in the event of a difference of opinion among the members determin-
ing any question, the opinion of the majority shall prevail; and
(b) in the event of an equally divided opinion among the members deter-
mining any question, the presiding member may determine the question.
(3) Where member unable to take part in judgment — Where a
member of the Tribunal is unable to take part in the giving of judgment in any
proceedings or has died, the other members sitting in those proceedings may,
whether or not they include a judicial member or a lay member, give judg-
ment and, for that purpose, shall be deemed to constitute the Tribunal.
Appeal
13. (1) Appeal — Subject to subsection (2), an appeal lies to the Federal
Court of Appeal from any decision or order, whether final, interlocutory or
interim, of the Tribunal as if it were a judgment of the Federal Court.
378
(2) Questions of fact — An appeal on a question of fact lies under subsec-

tion (1) only with the leave of the Federal Court of Appeal.
2002, c. 8, s. 130
Commentary
By virtue of s. 27 of the Federal Court Act, R.S.C. 1985, c. F-7, an appeal lies to the Federal
Court of Appeal from final judgments, judgments on questions of law determined before trial
and interlocutory judgments of the Trial Division.
In addition, under s. 28 of the Federal Court Act the Federal Court of Appeal has jurisdiction
to judicially review decisions or orders of a judicial or quasi-judicial nature made by a fed-
eral tribunal.
Under s. 18 of the Federal Court Act the Trial Division has “exclusive original jurisdiction”
Tribunal Act
in respect of prerogative writs and declaratory relief sought against a federal tribunal.
Case Law
Tervita Corp. v. Canada (Commissioner of Competition), 2015 SCC 3 (S.C.C.) — Tervita
appealed a Tribunal decision in relation to a contested merger under section 13. The Su-
preme Court held that Competition Tribunal decisions may be appealed as decisions of the
Federal Court, which rebuts the presumption under New Brunswick (Board of Management)
v. Dunsmuir, (sub nom. Dunsmuir v. New Brunswick) [2008] 1 S.C.R. 190 (S.C.C.) that
questions of law arising under a home statute are entitled to deference. The standard of cor-
rectness thereby applies to Tribunal decisions on issues of law, and reasonableness applies to
questions of mixed law and fact.
Barcode Systems Inc. v. Symbol Technologies Canada ULC, 2004 FCA 339 (F.C.A.) — In
an appeal from a Tribunal decision granting leave to the respondent to make an application
under the Competition Act for an order requiring the appellant to accept the respondent as a
customer, the Federal Court held that whether the Tribunal is required to consider all the
elements of the restrictive trade practice of refusal to deal when exercising its discretionary
power to grant leave under 103.1(7) is a question of law that does not engage any particular
expertise of the Tribunal and is therefore subject to the standard of correctness on review.
La-Z-Boy Canada Ltd. v. Allan Morgan and Sons Ltd. (2004), 35 C.P.R. (4th) 99 (Fed.
C.A.) — The Competition Tribunal granted leave to the applicant to bring an application
under the refusal to deal provision (s. 75) of the Competition Act. The respondent appealed
on the grounds that the Tribunal erred by not taking into account whether the practice al-
leged by the applicant could properly be the subject of a Tribunal order under s. 75 of the
Act. The respondent filed its notice of appeal 27 days after the pronouncement of the Tribu-
nal order. As the decision was interlocutory, and the time for filing an appeal with the Fed-
eral Court of Appeal was within ten days after the pronouncement of the decision, it was
necessary to obtain an order extending the time to file its appeal. As there was merit to the
appeal, it was in the interests of justice that the extension be granted.
(3d) 342, (sub nom. Director of Investigation & Research, Competition Act v. D & B Cos. of
Canada) 175 N.R. 306 (Fed. C.A.) — The Director commenced proceedings before the
Competition Tribunal alleging anti-competitive conduct on the part of the applicant. The
applicant sought an order for disclosure of the complainant’s information but its motion was
dismissed. The applicant appealed the dismissal and, then, being unable to obtain the consent
of the Director and intervenor to its request for an adjournment of the hearing before the
379
Tribunal, applied for an adjournment of the proceedings before the Tribunal pending the
results of the applicant’s appeal. When that was refused, the applicant brought an application
for a stay of proceedings before the Tribunal pending the appeal. The motion was dismissed
because the applicant had not shown that it would suffer irreparable harm if the stay were not
granted. The balance of convenience could not be said to be in the applicant’s favour.
(3d) 342 at 348, (sub nom. Director of Investigation & Research, Competition Act v. D & B
Cos. of Canada) 175 N.R. 312 (Competition Trib.) — The test for an adjournment pending
an appeal is the same as that for a stay of proceedings pending appeal. When proceedings
were brought by the Director against D. Co., the company unsuccessfully moved for the
Director to disclose documents that were subject to a public interest privilege. D. Co. ap-
pealed the ruling. Its motion to adjourn the proceedings until the appeal had been decided
was dismissed. Although D. Co.’s motion raised a serious issue regarding disclosure, it
would not suffer irreparable harm if the adjournment were denied. There was insufficient
evidence regarding what kind of findings might have been made in the proceedings or how
they might have damaged D. Co. In addition, while the disruption to the proceedings caused
by the appeal decision might have constituted a serious inconvenience, it did not amount to
irreparable harm.
Canada (Dir. of Investigation & Research) v. Imperial Oil (1990), 31 C.P.R. (3d) 284 (Fed.
C.A.) — Section 13(1) provides an express comprehensive statutory right of appeal of deci-
sions of the Tribunal which, by virtue of s. 29 of the Federal Court Act, precludes an appeal
under s. 28 of the Federal Court Act. Such an appeal is to be treated as if it were an appeal
from the Federal Court, Trial Division. An extension of time for an appeal from the Trial
Division must be obtained from that division, and accordingly an extension of time for an
appeal from a Tribunal decision must be sought from the Tribunal. The Federal Court of
Appeal is without jurisdiction to hear an application for such an extension.
Canada (Dir. of Investigation & Research) v. Imperial Oil (1990), 31 C.P.R. (3d) 277 (Com-
petition Trib.); affirmed (1992), 41 C.P.R. (3d) 493 (Fed. C.A.) — See entry under Competi-
tion Tribunal Act, s. 9.
Canada (Dir. of Investigation & Research) v. Air Can. (1988), [1989] 2 F.C. 88, 33 Admin
L.R. 229, 23 C.P.R. (3d) 178, (sub nom. American Airlines Inc. v. Canada (Competition
Tribunal)) 89 N.R. 241, 54 D.L.R. (4th) 741 (C.A.); affirmed [1989] 1 S.C.R. 236, 26 C.P.R.
95, 92 N.R. 320, 23 C.P.R. (3d) 178n — Since this section provides that any decision or
order of the Tribunal may be appealed as if it were an order of the Federal Court, Trial
Division, costs should be disposed of in an appeal from the Tribunal on a basis similar to that
employed in appeals from the Trial Division.
Canada (P.G.) c. Alex Couture Inc., [1987] R.J.Q. 1971, (sub nom. Canada (A.G.) v. Alex
Couture Inc.) 18 C.P.R. (3d) 382, (sub nom. Couture (Alex) Inc. c. Canada (P.G.)) 14
Q.A.C. 259 (C.A. Qué.) — The Superior Courts of the provinces have jurisdiction to deal
with constitutional questions concerning the Competition Act. The power to stay proceedings
before the Tribunal pending the outcome of such an action falls within this inherent
jurisdiction.
Administration of Tribunal
14. [Repealed 2014, c. 20, s. 447.]
380
Part II — Combines Investigation Act [R.S., c. C-34] (ss. 18–45) S. 18
15. Sittings — The Tribunal may sit at such times and at such places
throughout Canada as it considers necessary or desirable for the proper con-
duct of its business.
Rules
16. (1) Rules — Subject to the approval of the Governor in Council, the Tri-
bunal may make general rules that are not inconsistent with this Part of the
Competition Act
(a) for regulating the practice and procedure of the Tribunal; and
(b) for carrying out the work of the Tribunal and the management of its
internal affairs.
Tribunal Act
(2) When effective — No rule made under this section has effect until it has
been published in the Canada Gazette.
(3) Tabling of rules — A copy of every rule made under this section shall be
laid before Parliament on any of the first fifteen days after the making thereof
that either House of Parliament is sitting.
(4) Quorum — Five members of the Tribunal, at least three of whom are ju-
dicial members, constitute a quorum of the Tribunal for the purpose of mak-
ing rules under this section.
2014, c. 20, s. 448
17. Advance Publication of Rules and Amendments — Where the

Tribunal proposes to make any rule under section 16, it
(a) shall give notice of the proposal by publishing it in the Canada Gazette
and shall, in the notice, invite any interested person to make representa-
tions to it in writing with respect thereto within sixty days after the day of
the publication; and
(b) may, after the expiration of the sixty days referred to in paragraph (a)
and subject to the approval of the Governor in Council, implement the
proposal either as originally published or as revised in such manner as
the Tribunal deems advisable having regard to any representations so
made to it.
PART II — COMBINES INVESTIGATION ACT [R.S., C.

C-34] (SS. 18–45)
18. The long title of the Combines Investigation Act is repealed and the follow-
ing substituted therefor:
381
An Act to provide for the general regulation of trade and

commerce in respect of conspiracies, trade practices and
mergers affecting competition
19. Section 1 of the said Act is repealed and the following substituted therefor:
1. Short title — This Act may be cited as the Competition Act.
PURPOSE
1.1 Purpose of Act — The purpose of this Act is to maintain and en-
courage competition in Canada in order to promote the efficiency and
adaptability of the Canadian economy, in order to expand opportuni-
ties for Canadian participation in world markets while at the same time
recognizing the role of foreign competition in Canada, in order to en-
sure that small and medium-sized enterprises have an equitable oppor-
tunity to participate in the Canadian economy and in order to provide
consumers with competitive prices and product choices.
20. (1) Section 2 of the said Act is renumbered as subsection 2(1).

(2) The definitions “Commission”, “merger” and “monopoly” in subsection
2(1) of the said Act are repealed.
(3) Subsection 2(1) of the said Act is further amended by adding thereto, in
alphabetical order within the subsection, the following definitions:
“record” includes any correspondence, memorandum, book, plan, map,
drawing, diagram, pictorial or graphic work, photograph, film,
microform, sound recording, videotape, machine readable record, and
any other documentary material, regardless of physical form or char-
acteristics, and any copy or portion thereof; (“document”)
“Tribunal” means the Competition Tribunal established by subsection
3(1) of the Competition Tribunal Act. (“Tribunal”)
(4) Section 2 of the said Act is further amended by adding thereto the follow-
ing subsections:
(2) Affiliated corporation, partnership or sole proprietorship —
For the purposes of this Act,
(a) one corporation is affiliated with another corporation if one of
them is the subsidiary of the other or both are subsidiaries of the
same corporation or each of them is controlled by the same
person;
(b) if two corporations are affiliated with the same corporation at
the same time, they are deemed to be affiliated with each other;
and
382
(c) a partnership or sole proprietorship is affiliated with another

partnership, sole proprietorship or a company if both are con-
trolled by the same person.
(3) Subsidiary corporation — For the purposes of this Act, a corpo-
ration is a subsidiary of another corporation if it is controlled by that
other corporation.
(4) Control — For the purposes of this Act,
(a) a corporation is controlled by a person other than Her Majesty
if
(i) securities of the corporation to which are attached more
than fifty per cent of the votes that may be cast to elect direc-
Tribunal Act
tors of the corporation are held, directly or indirectly,
whether through one or more subsidiaries or otherwise, other-
wise than by way of security only, by or for the benefit of that
person, and
(ii) the votes attached to those securities are sufficient, if exer-
cised, to elect a majority of the directors of the corporation;
and
(b) a corporation is controlled by Her Majesty in right of Canada
or a province if
(i) the corporation is controlled by Her Majesty in the manner
described in paragraph (a), or
(ii) in the case of a corporation without share capital, a major-
ity of the directors of the corporation, other than ex officio
directors, are appointed by
(A) the Governor in Council or the Lieutenant Governor
in Council of the province, as the case may be, or
(B) a Minister of the government of Canada or the prov-
ince, as the case may be.
21. The said Act is further amended by adding thereto, immediately after sec-
tion 2 thereof, the following section:
2.1 Binding on agents of Her Majesty in certain cases — This Act
is binding on and applies to an agent of Her Majesty in right of Canada
or a province that is a corporation, in respect of commercial activities
engaged in by the corporation in competition, whether actual or poten-
tial, with other persons to the extent that it would apply if the agent
were not an agent of Her Majesty.
383
22. Paragraphs 9(1)(a) to (c) of the said Act are repealed and the following
substituted therefor:
(a) a person has contravened or failed to comply with an order made
pursuant to section 32, 33 or 34, or Part VIII,
(b) grounds exist for the making of an order under Part VIII, or
(c) an offence under Part VI or VII has been or is about to be
committed,
23. (1) Section 10 of the said Act is renumbered as subsection 10(1).

(2) Subparagraphs 10(1)(b)(i) to (iii) of the said Act are repealed and the fol-
lowing substituted therefor:
(i) a person has contravened or failed to comply with an order made
pursuant to section 32, 33 or 34, or Part VIII,
(ii) grounds exist for the making of an order under Part VIII, or
(iii) an offence under Part VI or VII has been or is about to be commit-
ted, or
ing subsections:
(2) Information on inquiry — The Director shall, on the written re-
quest of any person whose conduct is being inquired into under this Act
or any person who applies for an inquiry under section 9, inform that
person or cause that person to be informed as to the progress of the
inquiry.
(3) Inquiries to be in private — All inquiries under this section shall
be conducted in private.
24. Sections 11 to 24 of the said Act are repealed and the following substituted
therefor:
11. (1) Order for oral examination, production or written return —
Where, on the ex parte application of the Director or the authorized
representative of the Director, a judge of a superior or county court or
of the Federal Court is satisfied by information on oath or solemn affir-
mation that an inquiry is being made under section 10 and that any
person has or is likely to have information that is relevant to the in-
quiry, the judge may order that person to
(a) attend as specified in the order and be examined on oath or
solemn affirmation by the Director or the authorized representa-
tive of the Director on any matter that is relevant to the inquiry
before a person, in this section and sections 12 to 14 referred to as
a “presiding officer”, designated in the order;
384
(b) produce a record, or any other thing, specified in the order to

the Director or the authorized representative of the Director
within a time and at a place specified in the order; or
(c) make and deliver to the Director or the authorized representa-
tive of the Director, within a time specified in the order, a written
return under oath or solemn affirmation showing in detail such in-
formation as is by the order required.
(2) Records in possession of affiliate — Where the person against
whom an order is sought under paragraph (1)(b) in relation to an in-
quiry is a corporation and the judge to whom the application is made
under subsection (1) is satisfied by information on oath or solemn affir-
mation that an affiliate of the corporation, whether the affiliate is lo-
Tribunal Act
cated in Canada or outside Canada, has records that are relevant to the
inquiry, the judge may order the corporation to produce the records.
(3) No person excused from complying with order — No person
shall be excused from complying with an order under subsection (1) or
(2) on the ground that the testimony, record or other thing or return
required of the person may tend to criminate the person or subject him
to any proceeding or penalty, but no testimony given by an individual
pursuant to an order made under paragraph (1)(a), or return made by
an individual pursuant to an order made under paragraph (1)(c), shall
be used or received against that individual in any criminal proceedings
thereafter instituted against him, other than a prosecution under sec-
tion 132 or 136 of the Criminal Code.
(4) Effect of order — An order made under this section has effect any-
where in Canada.
12. (1) Witness competent and compellable — Any person sum-
moned to attend pursuant to paragraph 11(1)(a) is competent and may
be compelled to give evidence.
(2) Fees — Every person summoned to attend pursuant to paragraph
11(1)(a) is entitled to the like fees and allowances for so doing as if sum-
moned to attend before a superior court of the province in which the
person is summoned to attend.
(3) Representation by counsel — A presiding officer shall permit a
person who is being examined pursuant to an order under paragraph
11(1)(a) and any person whose conduct is being inquired into to be rep-
resented by counsel.
(4) Attendance of person whose conduct is being inquired
into — Any person whose conduct is being inquired into at an exami-
nation pursuant to an order under paragraph 11(1)(a) and that per-
son’s counsel are entitled to attend the examination unless the Director
or the authorized representative of the Director, or the person being
examined or his employer, establishes to the satisfaction of the presid-
385
ing officer that the presence of the person whose conduct is being in-
quired into would
(a) be prejudicial to the effective conduct of the examination or the
inquiry; or
(b) result in the disclosure of confidential commercial information
that relates to the business of the person being examined or his
employer.
13. (1) Presiding officer — Any person may be designated as a presid-
ing officer who is a barrister or advocate of at least ten years standing
at the bar of a province or who has been a barrister or advocate at the
bar of a province for at least ten years.
(2) Remuneration and expenses — A presiding officer shall be paid
such remuneration, and is entitled to be paid such travel and living ex-
penses, and such other expenses, incurred in the performance of his du-
ties under this Act, as may be fixed by the Governor in Council.
14. (1) Administration of oaths — The presiding officer may adminis-
ter oaths and take and receive solemn affirmations for the purposes of
examinations pursuant to paragraph 11(1)(a).
(2) Orders of presiding officer — A presiding officer may make such
orders as he considers to be proper for the conduct of an examination
pursuant to paragraph 11(1)(a).
(3) Application to court — A judge of a superior or county court or of
the Federal Court may, on application by a presiding officer, order any
person to comply with any order made by the presiding officer under
subsection (2).
(4) Notice — No order may be made under subsection (3) unless the
presiding officer has given to the person in respect of whom the order is
sought and the Director twenty-four hours notice of the hearing of the
application for the order or such shorter notice as the judge to whom
the application is made considers reasonable.
15. (1) Warrant for entry of premises — Where, on the ex parte ap-
plication of the Director or the authorized representative of the Direc-
tor, a judge of a superior or county court or of the Federal Court is
satisfied by information on oath or solemn affirmation
(a) that there are reasonable grounds to believe that
(i) a person has contravened or failed to comply with an order
made pursuant to section 32, 33 or 34, or Part VIII,
(ii) grounds exist for the making of an order under Part VIII,
or
(iii) an offence under Part VI or VII has been or is about to be
committed, and
386
(b) that there are reasonable grounds to believe that there is, on
any premises, any record or other thing that will afford evidence
with respect to the circumstances referred to in subparagraph
(a)(i), (ii) or (iii), as the case may be,
the judge may issue a warrant under his hand authorizing the Director
or any other person named in the warrant to
(c) enter the premises, subject to such conditions as may be speci-
fied in the warrant, and
(d) search the premises for any such record or other thing and
copy it or seize it for examination or copying.
(2) Contents of warrant — A warrant issued under this section shall
Tribunal Act
identify the matter in respect of which it is issued, the premises to be
searched and the record or other thing, or the class of records or other
things, to be searched for.
(3) Execution of search warrant — A warrant issued under this sec-
tion shall be executed between six o’clock in the forenoon and nine
o’clock in the afternoon, unless the judge issuing it, by the warrant,
authorizes execution of it at another time.
(4) Idem — A warrant issued under this section may be executed any-
where in Canada.
(5) Duty of persons in control of premises — Every person who is
in possession or control of any premises or record or other thing in
respect of which a warrant is issued under subsection (1) shall, on pres-
entation of the warrant, permit the Director or other person named in
the warrant to enter the premises, search the premises and examine the
record or other thing and to copy it or seize it.
(6) Where admission or access refused — Where the Director or
any other person, in executing a warrant issued under subsection (1), is
refused access to any premises, record or other thing or where the Di-
rector believes on reasonable grounds that access will be refused, the
judge who issued the warrant or a judge of the same court, on the ex
parte application of the Director, may by order direct a peace officer to
take such steps as the judge considers necessary to give the Director or
other person access.
(7) Where warrant not necessary — The Director or the authorized
representative of the Director may exercise any of the powers set out in
paragraph (1)(c) or (d) without a warrant if the conditions set out in
paragraphs (1)(a) and (b) exist but by reason of exigent circumstances
it would not be practical to obtain the warrant.
(8) Exigent circumstances — For the purposes of subsection (7), exi-
gent circumstances include circumstances in which the delay necessary
to obtain a warrant under subsection (1) would result in the loss or
destruction of evidence.
387
16. (1) Operation of computer system — A person who is authorized

pursuant to subsection 15(1) to search premises for a record may use or
cause to be used any computer system on the premises to search any
data contained in or available to the computer system, may reproduce
the record or cause it to be reproduced from the data in the form of a
printout or other intelligible output and may seize the printout or other
output for examination or copying.
(2) Duty of person in control of computer system — Every person
who is in possession or control of any premises in respect of which a
warrant is issued under subsection 15(1) shall, on presentation of the
warrant, permit any person named in the warrant to use or cause to be
used any computer system or part thereof on the premises to search
any data contained in or available to the computer system for data
from which a record that that person is authorized to search for may be
produced, to obtain a physical copy thereof and to seize it.
(3) Order restricting operation of computer system — A judge
who issued a warrant under subsection 15(1) or a judge of the same
court may, on application by the Director or any person who is in pos-
session or control of a computer system or a part thereof on any prem-
ises in respect of which the warrant was issued, make an order
(a) specifying the individuals who may operate the computer sys-
tem and fixing the times when they may do so; and
(b) setting out any other terms and conditions on which the com-
puter system may be operated.
(4) Notice by person in possession or control — No order may be
made under subsection (3) on application by a person who is in posses-
sion or control of a computer system or part thereof unless that person
has given the Director twenty-four hours notice of the hearing of the
application or such shorter notice as the judge considers reasonable.
(5) Notice by Director — No order may be made under subsection (3)
on application by the Director after a search has begun of the premises
in respect of which the order is sought unless the Director has given the
person who is in possession or control of the premises twenty-four
hours notice of the hearing of the application or such shorter notice as
the judge considers reasonable.
(6) Definitions — In this section, “computer system” and “data” have
the meanings set out in subsection 342.1(2) of the Criminal Code.
17. (1) Presentation of or report on record or thing seized —
Where a record or other thing is seized pursuant to paragraph 15(1)(d),
subsection 15(7) or section 16, the Director or the authorized represen-
tative of the Director shall, as soon as practicable,
(a) take the record or other thing before the judge who issued the
warrant or a judge of the same court or, if no warrant was issued,
388
before a judge of a superior or county court or of the Federal

Court; or
(b) make a report in respect of the record or other thing to a judge
determined in accordance with paragraph (a).
(2) Report — A report to a judge under paragraph (1)(b) in respect of
a record or other thing shall include
(a) a statement as to whether the record or other thing was seized
pursuant to paragraph 15(1)(d), subsection 15(7) or section 16;
(b) a description of the premises searched;
(c) a description of the record or other thing seized; and
(d) the location in which it is detained.
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(3) Retention or return of thing seized — Where a record or other
thing is seized pursuant to section 15 or 16, the judge before whom it is
taken or to whom a report is made in respect of it pursuant to this
section may, if he is satisfied that the record or other thing is required
for an inquiry or any proceeding under this Act, authorize the Director
to retain it.
18. (1) Director to take reasonable care — Where any record or
other thing is produced pursuant to section 11 or seized pursuant to
section 15 or 16, the Director shall take reasonable care to ensure that
it is preserved until it is returned to the person by whom it was pro-
duced or from whom it was seized or until it is required to be produced
in any proceeding under this Act.
(2) Access to records or things — The person by whom a record or
other thing is produced pursuant to section 11 or from whom a record
or other thing is seized pursuant to section 15 or 16 is entitled, at any
reasonable time and subject to such reasonable conditions as may be
imposed by the Director, to inspect the record or other thing.
(3) Copy of record where returned — The Director may, before re-
turning any record produced pursuant to section 11 or seized pursuant
to section 15 or 16, make or cause to be made, and may retain, a copy
thereof.
(4) Detention of things seized — Any record or other thing that is
produced pursuant to section 11, or the retention of which is authorized
under subsection 17(3), shall be returned to the person by whom it was
produced or the person from whom it was seized not later than sixty
days after it was produced or its retention was authorized, unless,
before the expiration of that period,
(a) the person by whom it was produced or from whom it was
seized agrees to its further detention for a specified period of time;
(b) the judge who authorized its production or retention or a judge
of the same court is satisfied on application that, having regard to
389
the circumstances, its further detention for a specified period of

time is warranted and the judge so orders; or
(c) proceedings are instituted in which the record or thing may be
required.
19. (1) Claim to solicitor-client privilege (section 11) — Where a
person is ordered to produce a record pursuant to section 11 and that
person claims that there exists a solicitor-client privilege in respect
thereof, the person shall place it in a package and seal and identify the
package and place it in the custody of a person referred to in subsection
(3).
(2) Claim to solicitor-client privilege (section 15 or 16) — Where,
pursuant to section 15 or 16, any person is about to examine, copy or
seize or is in the course of examining, copying or seizing any record and
a person appearing to be in authority claims that there exists a solici-
tor-client privilege in respect thereof, the first-mentioned person, unless
the person claiming the privilege withdraws the claim or the first-men-
tioned person desists from examining and copying the record and from
seizing it or a copy thereof, shall, without examining or further examin-
ing it or making a copy or further copy thereof, place it and any copies
of it made by him, and any notes taken in respect of it, in a package,
and seal and identify the package and place it in the custody of a person
referred to in subsection (3).
(3) Custody of record — A record in respect of which a solicitor-cli-
ent privilege is claimed under subsection (1) or (2) shall be placed in the
custody of
(a) the registrar, prothonotary or other like officer of a superior or
county court in the province in which the record was ordered to be
produced or in which it was found, or of the Federal Court;
(b) a sheriff of the district or county in which the record was or-
dered to be produced or in which it was found; or
(c) some person agreed on between the Director or the authorized
representative of the Director and the person who makes the claim
of privilege.
(4) Determination of claim to privilege — A judge of a superior or
county court in the province in which a record placed in custody under
this section was ordered to be produced or in which it was found, or of
the Federal Court, sitting in camera, may decide the question of solici-
tor-client privilege in relation to the record on application made in ac-
cordance with the rules of the court by the Director or the owner of the
record or the person in whose possession it was found within thirty
days after the day on which the record was placed in custody if notice
of the application has been given by the applicant to all other persons
entitled to make application.
390
(5) Idem — Where no application is made in accordance with subsec-

tion (4) within thirty days after the day on which a record is placed in
custody under this section, any judge referred to in subsection (4) shall,
on ex parte application by or on behalf of the Director, order the record
to be delivered to the Director.
(6) Authority of judge — A judge referred to in subsection (4) may
give any directions that the judge deems necessary to give effect to this
section, may order delivery up to the judge out of custody of any record
in respect of which he is asked to decide a question of solicitor-client
privilege and may inspect any such record.
(7) Prohibition — Any person who is about to examine, copy or seize
any record pursuant to section 15 or 16 shall not do so without afford-
Tribunal Act
ing a reasonable opportunity for a claim of solicitor-client privilege to
be made under this section.
(8) Access to record in custody — At any time while a record is in
custody under this section, a judge of a superior or county court in the
province in which the record is in custody, or of the Federal Court,
may, on an ex parte application of a person claiming solicitor-client
privilege under this section, authorize that person to examine the re-
cord or make a copy of it in the presence of the person who has custody
of it or the judge, but any such authorization shall contain provisions to
ensure that the record is repackaged and that the package is resealed
without alteration or damage.
20. (1) Inspection of records and things — All records or other
things obtained or received by the Director may be inspected by the
Director and also by such persons as he directs.
(2) Copies — Copies of any records referred to in subsection (1), in-
cluding copies by any process of photographic reproduction, on proof
orally or by affidavit that they are true copies, are admissible in evi-
dence in any proceedings under this Act and have the same probative
force as the original.
(3) Proof — Where proof referred to in subsection (2) is offered by af-
fidavit, it is not necessary to prove the signature or official character of
the deponent, if that information is set out in the affidavit, or to prove
the signature or official character of the person before whom the affi-
davit was sworn.
21. Counsel — Whenever in the opinion of the Director the public in-
terest so requires, the Director may apply to the Attorney General of
Canada to appoint and instruct counsel to assist in an inquiry under
section 10, and on such an application the Attorney General of Canada
may appoint and instruct counsel accordingly.
22. (1) Discontinuance of inquiry — At any stage of an inquiry under
section 10, if the Director is of the opinion that the matter being in-
391
quired into does not justify further inquiry, the Director may discon-
tinue the inquiry.
(2) Report — The Director shall, on discontinuing an inquiry, make a
report in writing to the Minister showing the information obtained and
the reason for discontinuing the inquiry.
(3) Notice to applicant — Where an inquiry made on application
under section 9 is discontinued, the Director shall inform the applicants
of the decision and give the grounds therefor.
(4) Review of decision — The Minister may, on the written request of
applicants under section 9 or on the Minister’s own motion, review any
decision of the Director to discontinue an inquiry under section 10, and
may, if in the Minister’s opinion the circumstances warrant, instruct
the Director to make further inquiry.
23. (1) Reference to Attorney General of Canada — The Director
may, at any stage of an inquiry under section 10, in addition to or in
lieu of continuing the inquiry, remit any records, returns or evidence to
the Attorney General of Canada for consideration as to whether an of-
fence has been or is about to be committed against this Act and for such
action as the Attorney General of Canada may wish to take.
(2) Prosecution by Attorney General of Canada — The Attorney
General of Canada may institute and conduct any prosecution or other
criminal proceedings under this Act, and for those purposes may exer-
cise all the powers and perform all the duties and functions conferred
by the Criminal Code on the attorney general of a province.
24. (1) Regulations — The Governor in Council may make regulations
regulating the practice and procedure in respect of applications, pro-
ceedings and orders under sections 11 to 19.
(2) Publication of proposed regulations — Subject to subsection
(3), a copy of each regulation that the Governor in Council proposes to
make under subsection (1) shall be published in the Canada Gazette at
least sixty days before the proposed effective date thereof and a reason-
able opportunity shall be afforded to interested persons to make repre-
sentations with respect thereto.
(3) Exception — No proposed regulation need be published under sub-
section (2) if it has previously been published pursuant to that subsec-
tion, whether or not it has been amended as a result of representations
made pursuant to that subsection.
25. The heading immediately preceding section 25 and sections 25 and 26 of

the said Act are repealed and the following substituted therefor:
392
ADMINISTRATION
25. Staff — All officers, clerks and employees required for carrying out
this Act shall be appointed in accordance with the Public Service Em-
ployment Act, except that the Director may, with the approval of the
Governor in Council, employ such temporary, technical and special as-
sistants as may be required to meet the special conditions that may
arise in carrying out this Act.
26. (1) Remuneration of temporary staff — Any temporary, techni-
cal and special assistants employed by the Director shall be paid such
remuneration, and are entitled to be paid such travel and living ex-
penses incurred in the performance of their duties under this Act, as
Tribunal Act
may be fixed by the Governor in Council.
(2) Remuneration and expenses payable out of appropriations —
The remuneration and expenses of the Director and of the temporary,
technical and special assistants employed by the Director, and of any
counsel instructed under this Act, shall be paid out of money appropri-
ated by Parliament to defray the cost of administering this Act.
(3) Public Service Employment Act applies — Subject to this sec-
tion and section 7, the Public Service Employment Act and other Acts
relating to the Public Service, in so far as applicable, apply to the Direc-
tor and to all other persons employed under this Act.
26. Sections 29 and 30 of the said Act are repealed and the following substi-
tuted therefor:
29. (1) Confidentiality — No person who performs or has performed
duties or functions in the administration or enforcement of this Act
shall communicate or allow to be communicated to any other person
except to a Canadian law enforcement agency or for the purposes of the
administration or enforcement of this Act
(a) the identity of any person from whom information was ob-
tained pursuant to this Act;
(c) whether notice has been given or information supplied in re-
spect of a particular proposed transaction under section 114; or
(d) any information obtained from a person requesting a certifi-
cate under section 102.
(2) Exception — This section does not apply in respect of any informa-
tion that has been made public.
393
27. Section 31 of the said Act is repealed and the following substituted there-
for:
31. Reduction or removal of customs duties — Whenever, as a re-
sult of an inquiry under this Act, a judgment of a court or a decision of
the Tribunal, it appears to the satisfaction of the Governor in Council
that
(a) competition in respect of any article has been prevented or less-
ened substantially, and
(b) the prevention or lessening of competition is facilitated by cus-
toms duties imposed on the article, or on any like article, or can be
reduced by a removal or reduction of customs duties so imposed,
the Governor in Council may, by order, remove or reduce any such
customs duties.
28. (1) All that portion of subsection 34(1) of the said Act following paragraph
(b) thereof is repealed and the following substituted therefor:
and in addition to any other penalty imposed on the person convicted,
prohibit the continuation or repetition of the offence or the doing of
any act or thing by the person convicted or any other person directed
toward the continuation or repetition of the offence.
(2) Subsection 34(2) of the said Act is repealed and the following substituted
therefor:
(2) Idem — Where it appears to a superior court of criminal jurisdic-
tion in proceedings commenced by information of the Attorney General
of Canada or the attorney general of the province for the purposes of
this section that a person has done, is about to do or is likely to do any
act or thing constituting or directed toward the commission of an of-
fence under Part VI, the court may prohibit the commission of the of-
fence or the doing or continuation of any act or thing by that person or
any other person constituting or directed toward the commission of the
offence.
(3) All that portion of subsection 34(3) of the French version of the said Act
following paragraph (c) thereof is repealed and the following substituted
therefor:
selon le cas, pour tout motif comportant une question de droit ou, si la
permission d’interjeter appel est accordée par le tribunal auprès du-
quel l’appel est interjeté dans les vingt et un jours suivant le prononcé
du jugement faisant l’objet de la demande de permission d’appel ou
dans le délai prolongé qu’accorde, pour des raisons spéciales, le tribu-
nal auprès duquel l’appel est interjeté ou un juge de ce tribunal, pour
tout motif que celui-ci estime un motif suffisant d’appel.
29. Part V of the said Act is repealed.
394
Part II — Combines Investigation Act [R.S., c. C-34] (ss. 18–45)S. 30(4)
(d) thereof is repealed and the following substituted therefor:
is guilty of an indictable offence and liable to imprisonment for a term
not exceeding five years or to a fine not exceeding ten million dollars or
to both.
(2) Subsection 45(2) of the French version of the said Act is repealed and the
following substituted therefor:
(2) Idem — Il demeure entendu qu’il n’est pas nécessaire, pour établir
qu’un complot, une association d’intérêts, un accord ou un arrange-
ment constitue l’une des infractions visées au paragraphe (1), de
prouver que le complot, l’association d’intérêts, l’accord ou
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l’arrangement, s’il était exécuté, éliminerait ou éliminerait vraisembl-
ablement la concurrence, entièrement ou à toutes fins utiles, sur le
marché auquel il se rapporte, ni que les participants, ou l’un ou
plusieurs d’entre eux, visaient à éliminer la concurrence, entièrement
ou à toutes fins utiles, sur ce marché.
(3) Section 45 of the said Act is further amended by adding thereto, immedi-
ately after subsection (2) thereof, the following subsections:
(2.1) Evidence of conspiracy — In a prosecution under subsection
(1), the court may infer the existence of a conspiracy, combination,
agreement or arrangement from circumstantial evidence, with or with-
out direct evidence of communication between or among the alleged
parties thereto, but, for greater certainty, the conspiracy, combination,
agreement or arrangement must be proved beyond a reasonable doubt.
(2.2) Proof of intent — For greater certainty, in establishing that a
conspiracy, combination, agreement or arrangement is in contraven-
tion of subsection (1), it is necessary to prove that the parties thereto
intended to and did enter into the conspiracy, combination, agreement
or arrangement, but it is not necessary to prove that the parties in-
tended that the conspiracy, combination, agreement or arrangement
have an effect set out in subsection (1).
(4) Paragraphs 45(6)(a) to (d) of the said Act are repealed and the following
(b) has restricted or is likely to restrict any person from entering into
or expanding the business of exporting products from Canada; or
(c) has prevented or lessened or is likely to prevent or lessen competi-
tion unduly in the supply of services facilitating the export of products
from Canada.
395
(5) Section 45 of the said Act is further amended by adding thereto, immedi-
ately after subsection (7) thereof, the following subsection:
(7.1) Exception — Subsection (1) does not apply in respect of an agree-
ment or arrangement between banks that is described in subsection
49(1).
therefor:
(8) Exception — Subsection (1) does not apply in respect of a conspir-
acy, combination, agreement or arrangement that is entered into only
by companies each of which is, in respect of every one of the others, an
affiliate.
31. The said Act is further amended by adding thereto, immediately after sec-
tion 45 thereof, the following section:
45.1 Where application made under section 79 or 92 — No pro-
ceedings may be commenced under subsection 45(1) against a person
against whom an order is sought under section 79 or 92 on the basis of
the same or substantially the same facts as would be alleged in proceed-
ings under that subsection.
32. (1) Subsection 46(1) of the French version of the said Act is repealed and
the following substituted therefor:
46. (1) Directives étrangères — Toute personne morale, où qu’elle ait
été constituée, qui exploite une entreprise au Canada et qui applique,
en totalité ou en partie au Canada, une directive ou instruction ou un
énoncé de politique ou autre communication à la personne morale ou à
quelque autre personne, provenant d’une personne se trouvant dans un
pays étranger qui est en mesure de diriger ou d’influencer les principes
suivis par la personne morale, lorsque la communication a pour objet
de donner effet à un complot, une association d’intérêts, un accord ou
un arrangement intervenu à l’étranger qui, s’il était intervenu au Can-
ada, aurait constitué une infraction visée à l’article 45, commet, qu’un
administrateur ou dirigeant de la personne morale au Canada soit ou
non au courant du complot, de l’association d’intérêts, de l’accord ou
de l’arrangement, un acte criminel et encourt, sur déclaration de
culpabilité, une amende à la discrétion du tribunal.
therefor:
(2) Limitation — No proceedings may be commenced under this sec-
tion against a particular company where an application has been made
by the Director under section 83 for an order against that company or
any other person based on the same or substantially the same facts as
would be alleged in proceedings under this section.
396
33. Subsection 47(3) of the said Act is repealed and the following substituted
therefor:
(3) Exception — This section does not apply in respect of an agree-
ment or arrangement that is entered into or a submission that is ar-
rived at only by companies each of which is, in respect of every one of
the others, an affiliate.
for:
49. (1) Agreements or arrangements of banks — Subject to subsec-
tion (2), every bank that makes an agreement or arrangement with an-
Tribunal Act
other bank with respect to
(c) the amount of any charge for a service provided to a customer,
(f) the person or classes of persons to whom a loan or other service
will be made or provided or from whom a loan or other service
will be withheld,
and every director, officer or employee of the bank who knowingly
makes such an agreement or arrangement on behalf of the bank is
guilty of an indictable offence and liable to a fine not exceeding five
million dollars or to imprisonment for a term not exceeding five years
or to both.
(2) Exceptions — Subsection (1) does not apply to an agreement or
arrangement
(a) with respect to a deposit or loan made or payable outside
Canada;
(b) applicable only to the dealings of or the services rendered be-
tween banks or by two or more banks as regards a customer of
each of such banks where the customer has knowledge of the
agreement or by a bank as regards a customer thereof, on behalf
of that customer’s customers;
(c) with respect to a bid for or purchase, sale or underwriting of
securities by banks or a group including banks;
(d) with respect to the exchange of statistics and credit informa-
tion, the development and utilization of systems, forms, methods,
procedures and standards, the utilization of common facilities and
joint research and development in connection therewith, and the
restriction of advertising;
397
(e) with respect to reasonable terms and conditions of participation

in guaranteed or insured loan programs authorized pursuant to an
Act of Parliament or of the legislature of a province;
(f) with respect to the amount of any charge for a service or with
respect to the kind of service provided to a customer outside Can-
ada, payable or performed outside Canada, or payable or per-
formed in Canada on behalf of a person who is outside Canada;
(g) with respect to the persons or classes of persons to whom a loan
or other service will be made or provided outside Canada; or
(h) in respect of which the Minister of Finance has certified to the
Director the names of the parties thereto and that he has requested
or approved the agreement or arrangement for the purposes of fi-
nancial policy.
35. All that portion of subsection 59(1) of the French version of the said Act
preceding paragraph (a) thereof is repealed and the following substituted
therefor:
59. (1) Concours publicitaire — Nul ne peut, aux fins de promouvoir,
directement ou indirectement, soit la vente d’un produit, soit des intér-
êts commerciaux quelconques, organiser un concours, une loterie, un
jeu de hasard, un jeu d’adresse ou un jeu où se mêlent le hasard et
l’adresse, ni autrement attribuer un produit ou autre avantage par un
jeu faisant intervenir le hasard, l’adresse ou un mélange des deux sous
quelque forme que ce soit, à moins que ce concours, cette loterie, ce jeu
ou cette attribution ne soit légal en l’absence du présent article et que
les conditions suivantes ne soient réunies :
36. Subsections 61(7) and (8) of the said Act are repealed.
37. Section 63 of the said Act is repealed.
for:
65. (1) Contravention of subsection 15(5) or 16(2) — Every person
who contravenes subsection 15(5) or 16(2) is guilty of an offence and
liable on summary conviction or on conviction on indictment to a fine
not exceeding five thousand dollars or to imprisonment for a term not
exceeding two years or to both.
(2) Failure to make return or supply information — Every person
who, without good and sufficient cause, the proof of which lies on the
person, fails to comply with an order made under section 11 or with
section 114 or 123 is guilty of an offence and liable on summary convic-
tion or on conviction on indictment to a fine not exceeding five thou-
398
Part II — Combines Investigation Act [R.S., c. C-34] (ss. 18–45)S. 40(3)
sand dollars or to imprisonment for a term not exceeding two years or

to both.
who destroys or alters, or causes to be destroyed or altered, any record
or other thing that is required to be produced pursuant to section 11 or
in respect of which a warrant is issued under section 15 is guilty of an
offence and liable
(a) on summary conviction to a fine not exceeding twenty-five
thousand dollars or to imprisonment for a term not exceeding two
years or to both; or
(b) on conviction on indictment to a fine not exceeding fifty thou-
sand dollars or to imprisonment for a term not exceeding five
Tribunal Act
years or to both.
(4) Liability of directors — Where a corporation commits an offence
under this section, any officer, director or agent of the corporation who
directed, authorized, assented to, acquiesced in or participated in the
commission of the offence is a party to and guilty of the offence and is
liable to the punishment provided for the offence whether or not the
corporation has been prosecuted or convicted.
39. Section 66 of the said Act is repealed.
40. (1) The definition “document” in subsection 69(1) of the said Act is
repealed.
(2) The definition “agent of a participant” in subsection 69(1) of the said Act is
repealed and the following substituted therefor:
“agent of a participant” means a person who by a record admitted in
evidence under this section appears to be or is otherwise proven to be
an officer, agent, servant, employee or representative of a participant;
(“agent d’un participant”)
therefor:
(2) Evidence against a participant — In any proceedings before the
Tribunal or in any prosecution or proceedings before a court under or
pursuant to this Act,
(a) anything done, said or agreed on by an agent of a participant
shall, in the absence of evidence to the contrary, be deemed to have
been done, said or agreed on, as the case may be, with the author-
ity of that participant;
(b) a record written or received by an agent of a participant shall,
in the absence of evidence to the contrary, be deemed to have been
written or received, as the case may be, with the authority of that
participant; and
399
(c) a record proved to have been in the possession of a participant

or on premises used or occupied by a participant or in the posses-
sion of an agent of a participant shall be admitted in evidence
without further proof thereof and is prima facie proof
(i) that the participant had knowledge of the record and its
contents,
(ii) that anything recorded in or by the record as having been
done, said or agreed on by any participant or by an agent of a
participant was done, said or agreed on as recorded and,
where anything is recorded in or by the record as having been
done, said or agreed on by an agent of a participant, that it
was done, said or agreed on with the authority of that partici-
pant, and
(iii) that the record, where it appears to have been written by
any participant or by an agent of a participant, was so written
and, where it appears to have been written by an agent of a
participant, that it was written with the authority of that
participant.
(b) thereof is repealed and the following substituted therefor:
is admissible in evidence in any proceedings before the Tribunal or in
any prosecution or proceedings before a court under or pursuant to
this Act.
(2) All that portion of subsection 70(2) of the said Act preceding paragraph (a)
thereof is repealed and the following substituted therefor:
(2) Idem — On request from the Minister or the Director
(3) All that portion of subsection 70(2) of the said Act following paragraph (b)
compile from his or its records a statement of statistics relating to any
industry or sector thereof, in accordance with the terms of the request,
and any such statement is admissible in evidence in any proceedings
before the Tribunal or in any prosecution or proceedings before a court
under or pursuant to this Act.
therefor:
(4) Certificate — In any proceedings before the Tribunal, or in any
prosecution or proceedings before a court under or pursuant to this
Act, a certificate purporting to be signed by the Chief Statistician of
Canada or the officer of the department or agency of the Government
of Canada or of a province under whose supervision a record, report or
statement of statistics referred to in this section was prepared, setting
out that the record, report or statement of statistics attached thereto
400
was prepared under his supervision, is evidence of the facts alleged

therein without proof of the signature or official character of the per-
son by whom it purports to be signed.
for:
71. Statistics collected by sampling methods — A collection, com-
pilation, analysis, abstract or other record or report of statistics col-
lected by sampling methods by or on behalf of the Director or any other
party to proceedings before the Tribunal, or to a prosecution or pro-
ceedings before a court under or pursuant to this Act, is admissible in
evidence in that prosecution or those proceedings.
Tribunal Act
therefor:
72. (1) Notice — No record, report or statement of statistical informa-
tion or statistics referred to in section 70 or 71 shall be received in evi-
dence before the Tribunal or court unless the person intending to pro-
duce the record, report or statement in evidence has given to the person
against whom it is intended to be produced reasonable notice together
with a copy of the record, report or statement and, in the case of a
record or report of statistics referred to in section 71, together with the
names and qualifications of those persons who participated in the prep-
aration thereof.
44. All that portion of section 74 of the said Act preceding paragraph (a)
74. Failure to comply with certain orders — Any person who con-
travenes or fails to comply with an order of the Tribunal under Part
VIII is guilty of an offence and liable
45. Part VIII of the said Act is repealed and the following substituted therefor:

Refusal to Deal
75. (1) Jurisdiction of Tribunal where refusal to deal — Where, on
application by the Director, the Tribunal finds that
(a) a person is substantially affected in his business or is precluded
from carrying on business due to his inability to obtain adequate
supplies of a product anywhere in a market on usual trade terms,
401
(b) the person referred to in paragraph (a) is unable to obtain ade-

quate supplies of the product because of insufficient competition
among suppliers of the product in the market,
(c) the person referred to in paragraph (a) is willing and able to
meet the usual trade terms of the supplier or suppliers of the prod-
uct, and
(d) the product is in ample supply,
the Tribunal may order that one or more suppliers of the product in
the market accept the person as a customer within a specified time on
usual trade terms unless, within the specified time, in the case of an
article, any customs duties on the article are removed, reduced or re-
mitted and the effect of the removal, reduction or remission is to place
the person on an equal footing with other persons who are able to ob-
tain adequate supplies of the article in Canada.
(2) When article is a separate product — For the purposes of this
section, an article is not a separate product in a market only because it
is differentiated from other articles in its class by a trade-mark, propri-
etary name or the like, unless the article so differentiated occupies such
a dominant position in that market as to substantially affect the ability
of a person to carry on business in that class of articles unless that per-
son has access to the article so differentiated.
(3) Definition of “trade terms” — For the purposes of this section, the
Consignment Selling
76. Consignment selling — Where, on application by the Director,
the Tribunal finds that the practice of consignment selling has been in-
troduced by a supplier of a product who ordinarily sells the product for
resale, for the purpose of
(a) controlling the price at which a dealer in the product supplies
the product, or
(b) discriminating between consignees or between dealers to whom
he sells the product for resale and consignees,
the Tribunal may order the supplier to cease to carry on the practice of
consignment selling of the product.
77. (1) Definitions — For the purposes of this section,
402
“exclusive dealing” means

(a) any practice whereby a supplier of a product, as a condition of
supplying the product to a customer, requires that customer to
(i) deal only or primarily in products supplied by or desig-
nated by the supplier or the supplier’s nominee, or
(ii) refrain from dealing in a specified class or kind of product
except as supplied by the supplier or the nominee, and
(b) any practice whereby a supplier of a product induces a cus-
tomer to meet a condition set out in subparagraph (a)(i) or (ii) by
offering to supply the product to the customer on more favourable
terms or conditions if the customer agrees to meet the condition set
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out in either of those subparagraphs;
(“exclusivité”)
“market restriction” means any practice whereby a supplier of a prod-
uct, as a condition of supplying the product to a customer, requires that
customer to supply any product only in a defined market, or exacts a
penalty of any kind from the customer if he supplies any product
outside a defined market; (“limitation...”)
“tied selling” means
(a) any practice whereby a supplier of a product, as a condition of
supplying the product (the “tying” product) to a customer, re-
quires that customer to
(i) acquire any other product from the supplier or the sup-
plier’s nominee, or
(ii) refrain from using or distributing, in conjunction with the
tying product, another product that is not of a brand or man-
ufacture designated by the supplier or the nominee, and
(b) any practice whereby a supplier of a product induces a cus-
tomer to meet a condition set out in subparagraph (a)(i) or (ii) by
offering to supply the tying product to the customer on more fa-
vourable terms or conditions if the customer agrees to meet the
condition set out in either of those subparagraphs.
(“ventes liées”)
(2) Exclusive dealing and tied selling — Where, on application by
the Director, the Tribunal finds that exclusive dealing or tied selling,
because it is engaged in by a major supplier of a product in a market or
because it is widespread in a market, is likely to
(a) impede entry into or expansion of a firm in the market,
(b) impede introduction of a product into or expansion of sales of a
product in the market, or
(c) have any other exclusionary effect in the market,
403
with the result that competition is or is likely to be lessened substan-

tially, the Tribunal may make an order directed to all or any of the
suppliers against whom an order is sought prohibiting them from con-
tinuing to engage in that exclusive dealing or tied selling and containing
any other requirement that, in its opinion, is necessary to overcome the
effects thereof in the market or to restore or stimulate competition in
the market.
(3) Market restriction — Where, on application by the Director, the
Tribunal finds that market restriction, because it is engaged in by a
major supplier of a product or because it is widespread in relation to a
product, is likely to substantially lessen competition in relation to the
product, the Tribunal may make an order directed to all or any of the
suppliers against whom an order is sought prohibiting them from con-
tinuing to engage in market restriction and containing any other re-
quirement that, in its opinion, is necessary to restore or stimulate com-
petition in relation to the product.
(4) Where no order to be made and limitation on application of
order — The Tribunal shall not make an order under this section
where, in its opinion,
(a) exclusive dealing or market restriction is or will be engaged in
only for a reasonable period of time to facilitate entry of a new
supplier of a product into a market or of a new product into a
market,
(b) tied selling that is engaged in is reasonable having regard to the
technological relationship between or among the products to which
it applies, or
(c) tied selling that is engaged in by a person in the business of
lending money is for the purpose of better securing loans made by
that person and is reasonably necessary for that purpose,
and no order made under this section applies in respect of exclusive
dealing, market restriction or tied selling between or among companies,
partnerships and sole proprietorships that are affiliated.
(5) Where company, partnership or sole proprietorship affili-
ated — For the purposes of subsection (4),
(a) one company is affiliated with another company if one of them
is the subsidiary of the other or both are the subsidiaries of the
same company or each of them is controlled by the same person;
(b) if two companies are affiliated with the same company at the
same time, they are deemed to be affiliated with each other;
(c) a partnership or sole proprietorship is affiliated with another
partnership, sole proprietorship or a company if both are con-
trolled by the same person; and
404
(d) a company, partnership or sole proprietorship is affiliated with

another company, partnership or sole proprietorship in respect of
any agreement between them whereby one party grants to the
other party the right to use a trade-mark or trade-name to identify
the business of the grantee, if
(i) the business is related to the sale or distribution, pursuant
to a marketing plan or system prescribed substantially by the
grantor, of a multiplicity of products obtained from compet-
ing sources of supply and a multiplicity of suppliers, and
(ii) no one product dominates the business.
(6) When persons deemed to be affiliated — For the purposes of
subsection (4) in its application to market restriction, where there is an
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agreement whereby one person (the “first” person) supplies or causes
to be supplied to another person (the “second” person) an ingredient or
ingredients that the second person processes by the addition of labour
and material into an article of food or drink that he then sells in associ-
ation with a trade-mark that the first person owns or in respect of
which the first person is a registered user, the first person and the sec-
ond person are deemed, in respect of the agreement, to be affiliated.
78. Definition of “anti-competitive act” — For the purposes of sec-
tion 79, “anti-competitive act”, without restricting the generality of the
term, includes any of the following acts:
(a) squeezing, by a vertically integrated supplier, of the margin
available to an unintegrated customer who competes with the sup-
plier, for the purpose of impeding or preventing the customer’s en-
try into, or expansion in, a market;
(b) acquisition by a supplier of a customer who would otherwise be
available to a competitor of the supplier, or acquisition by a cus-
tomer of a supplier who would otherwise be available to a competi-
tor of the customer, for the purpose of impeding or preventing the
competitor’s entry into, or eliminating the competitor from, a
market;
(c) freight equalization on the plant of a competitor for the pur-
pose of impeding or preventing the competitor’s entry into, or
eliminating the competitor from, a market;
(d) use of fighting brands introduced selectively on a temporary
basis to discipline or eliminate a competitor;
(e) pre-emption of scarce facilities or resources required by a com-
petitor for the operation of a business, with the object of withhold-
ing the facilities or resources from a market;
(f) buying up of products to prevent the erosion of existing price
levels;
405
(g) adoption of product specifications that are incompatible with

products produced by any other person and are designed to pre-
vent his entry into, or to eliminate him from, a market;
(h) requiring or inducing a supplier to sell only or primarily to
certain customers, or to refrain from selling to a competitor, with
the object of preventing a competitor’s entry into, or expansion in,
a market; and
(i) selling articles at a price lower than the acquisition cost for the
purpose of disciplining or eliminating a competitor.
79. (1) Prohibition where abuse of dominant position — Where, on
application by the Director, the Tribunal finds that
(a) one or more persons substantially or completely control,
throughout Canada or any area thereof, a class or species of
business,
(b) that person or those persons have engaged in or are engaging
in a practice of anti-competitive acts, and
(c) the practice has had, is having or is likely to have the effect of
preventing or lessening competition substantially in a market,
the Tribunal may make an order prohibiting all or any of those persons
from engaging in that practice.
(2) Additional or alternative order — Where, on an application
under subsection (1), the Tribunal finds that a practice of anti-competi-
tive acts has had or is having the effect of preventing or lessening com-
petition substantially in a market and that an order under subsection
(1) is not likely to restore competition in that market, the Tribunal
may, in addition to or in lieu of making an order under subsection (1),
make an order directing any or all the persons against whom an order
is sought to take such actions, including the divestiture of assets or
shares, as are reasonable and as are necessary to overcome the effects
of the practice in that market.
(3) Limitation — In making an order under subsection (2), the Tribu-
nal shall make the order in such terms as will in its opinion interfere
with the rights of any person to whom the order is directed or any
other person affected by it only to the extent necessary to achieve the
purpose of the order.
(4) Superior competitive performance — In determining, for the
purposes of subsection (1), whether a practice has had, is having or is
likely to have the effect of preventing or lessening competition substan-
tially in a market, the Tribunal shall consider whether the practice is a
result of superior competitive performance.
(5) Exception — For the purpose of this section, an act engaged in
pursuant only to the exercise of any right or enjoyment of any interest
derived under the Copyright Act, Industrial Design Act, Patent Act,
406
Trade-marks Act or any other Act of Parliament pertaining to intellec-

tual or industrial property is not an anti-competitive act.
(6) Limitation period — No application may be made under this sec-
tion in respect of a practice of anti-competitive acts more than three
years after the practice has ceased.
(7) Where proceedings commenced under section 45 or 92 — No
application may be made under this section against a person
(a) against whom proceedings have been commenced under section
45, or
(b) against whom an order is sought under section 92
on the basis of the same or substantially the same facts as would be
Tribunal Act
alleged in the proceedings under section 45 or 92, as the case may be.
Delivered Pricing
80. (1) Definition of “delivered pricing” — For the purposes of sec-
tion 81, “delivered pricing” means the practice of refusing a customer,
or a person seeking to become a customer, delivery of an article at any
place in which the supplier engages in a practice of making delivery of
the article to any other of the supplier’s customers on the same trade
terms that would be available to the first-mentioned customer if his
place of business were located in that place.
(2) Definition of “trade terms” — For the purposes of subsection (1),
the expression “trade terms” means terms in respect of payment, units
of purchase and reasonable technical and servicing requirements.
81. (1) Delivered pricing — Where, on application by the Director, the
Tribunal finds that delivered pricing is engaged in by a major supplier
of an article in a market or is widespread in a market with the result
that a customer, or a person seeking to become a customer, is denied an
advantage that would otherwise be available to him in the market, the
Tribunal may make an order prohibiting all or any of such suppliers
from engaging in delivered pricing.
(2) Exception where significant capital investment needed — No
order shall be made against a supplier under this section where the Tri-
bunal finds that the supplier could not accommodate any additional
customers at a locality without making significant capital investment at
that locality.
(3) Exception where trade-mark used — No order shall be made
against a supplier under this section in respect of a practice of refusing
a customer delivery of an article that the customer sells in association
with a trade-mark that the supplier owns or in respect of which the
supplier is a registered user where the Tribunal finds that the practice
is necessary to maintain a standard of quality in respect of the article.
407

82. Foreign judgments, etc. — Where, on application by the Direc-
tor, the Tribunal finds that
(a) a judgment, decree, order or other process given, made or is-
sued by or out of a court or other body in a country other than
Canada can be implemented in whole or in part by persons in
Canada, by companies incorporated by or pursuant to an Act of
Parliament or of the legislature of a province, or by measures
taken in Canada, and
(b) the implementation in whole or in part of the judgment, decree,
order or other process in Canada, would
(i) adversely affect competition in Canada,
(ii) adversely affect the efficiency of trade or industry in Can-
ada without bringing about or increasing in Canada competi-
tion that would restore or improve that efficiency,
(iii) adversely affect the foreign trade of Canada without com-
pensating advantages, or
(iv) otherwise restrain or injure trade or commerce in Canada
without compensating advantages,
(c) no measures be taken in Canada to implement the judgment,
decree, order or process, or
(d) no measures be taken in Canada to implement the judgment,
decree, order or process except in such manner as the Tribunal
prescribes for the purpose of avoiding an effect referred to in sub-
paragraphs (b)(i) to (iv).
83. (1) Foreign laws and directives — Where, on application by the
Director, the Tribunal finds that a decision has been or is about to be
made by a person in Canada or a company incorporated by or pursu-
ant to an Act of Parliament or of the legislature of a province
(a) as a result of
(i) a law in force in a country other than Canada, or
(ii) a directive, instruction, intimation of policy or other com-
munication to that person or company or to any other person
from
(A) the government of a country other than Canada or of
any political subdivision thereof that is in a position to
direct or influence the policies of that person or com-
pany, or
408
(B) a person in a country other than Canada who is in a

position to direct or influence the policies of that person
or company,
where the communication is for the purpose of giving effect to
a law in force in a country other than Canada,
and that the decision, if implemented, would have or would be
likely to have any of the effects mentioned in subparagraphs
82(b)(i) to (iv), or
(b) as a result of a directive, instruction, intimation of policy or
other communication to that person or company or to any other
person, from a person in a country other than Canada who is in a
position to direct or influence the policies of that person or com-
Tribunal Act
pany, where the communication is for the purpose of giving effect
to a conspiracy, combination, agreement or arrangement entered
into outside Canada that, if entered into in Canada, would have
been in contravention of section 45,
(c) in a case described in paragraph (a) or (b), no measures be
taken by the person or company in Canada to implement the law,
directive, instruction, intimation of policy or other communication,
or
(d) in a case described in paragraph (a), no measures be taken by
the person or company in Canada to implement the law, directive,
instruction, intimation of policy or other communication except in
such manner as the Tribunal prescribes for the purpose of avoid-
ing an effect referred to in subparagraphs 82(b)(i) to (iv).
(2) Limitation — No application may be made by the Director for an
order under this section against a particular company where proceed-
ings have been commenced under section 46 against that company
based on the same or substantially the same facts as would be alleged in
the application.
Foreign Suppliers
84. Refusal to supply by foreign supplier — Where, on application
by the Director, the Tribunal finds that a supplier outside Canada has
refused to supply a product or otherwise discriminated in the supply of
a product to a person in Canada (the “first” person) at the instance of
and by reason of the exertion of buying power outside Canada by an-
other person, the Tribunal may order any person in Canada (the “sec-
ond” person) by whom or on whose behalf or for whose benefit the buy-
ing power was exerted
(a) to sell any such product of the supplier that the second person
has obtained or obtains to the first person at the laid-down cost in
Canada to the second person of the product and on the same terms
409
and conditions as the second person obtained or obtains from the

supplier; or
(b) not to deal or to cease to deal, in Canada, in that product of the
supplier.
85. Definitions — For the purposes of this section and sections 86 to
90,
“article” includes each separate type, size, weight and quality in which
an article, within the meaning assigned by section 2, is produced;
(“article”)
“registered” means registered in the register maintained pursuant to
section 89; (“inscrit”)
“specialization agreement” means an agreement under which each
party thereto agrees to discontinue producing an article or service that
he is engaged in producing at the time the agreement is entered into on
the condition that each other party to the agreement agrees to discon-
tinue producing an article or service that he is engaged in producing at
the time the agreement is entered into, and includes any such agree-
ment under which the parties also agree to buy exclusively from each
other the articles or services that are the subject of the agreement.
(“accord...”)
86. (1) Order directing registration — Where, on application by any
person, and after affording the Director a reasonable opportunity to be
heard, the Tribunal finds that an agreement that the person who has
made the application has entered into or is about to enter into is a spe-
cialization agreement and that
(a) the implementation of the agreement is likely to bring about
gains in efficiency that will be greater than, and will offset, the ef-
fects of any prevention or lessening of competition that will result
or is likely to result from the agreement and the gains in efficiency
would not likely be attained if the agreement were not imple-
mented, and
(b) no attempt has been made by the persons who have entered or
are about to enter into the agreement to coerce any person to be-
come a party to the agreement,
the Tribunal may, subject to subsection (4), make an order directing
that the agreement be registered for a period specified in the order.
(2) Factors to be considered — In considering whether an agree-
ment is likely to bring about gains in efficiency described in paragraph
(1)(a), the Tribunal shall consider whether those gains will result in
410
(b) a significant substitution of domestic articles or services for im-

ported articles or services.
(3) Redistribution of income does not result in gains in effi-
ciency — For the purposes of paragraph (1)(a), the Tribunal shall not
find that an agreement is likely to bring about gains in efficiency by
reason only of a redistribution of income between two or more persons.
(4) Conditional orders — Where, on an application under subsection
(1), the Tribunal finds that an agreement meets the conditions pre-
scribed by paragraphs (a) and (b) of that subsection but also finds that,
as a result of the implementation of the agreement, there is not likely to
be substantial competition remaining in the market or markets to
which the agreement relates, the Tribunal may provide, in an order
Tribunal Act
made under subsection (1), that the order shall take effect only if,
within a reasonable period of time specified in the order, there has oc-
curred any of the following events, specified in the order:
(a) the divestiture of particular assets, specified in the order;
(b) a wider licensing of patents;
(c) a reduction in tariffs;
(d) the making of an order in council under section 23 of the Fi-
nancial Administration Act effecting a remission or remissions
specified in the order of the Tribunal of any customs duties on an
article that is a subject of the agreement; or
(e) the removal of import quotas or import licensing requirements.
87. (1) Registration of modifications — On application by the par-
ties to a specialization agreement that has been registered, and after
affording the Director a reasonable opportunity to be heard, the Tribu-
nal may make an order directing that a modification of the agreement
be registered.
(2) Order to remove from register — Where, on application by the
Director, the Tribunal finds that the agreement or a modification
thereof that has been registered
(a) has ceased to meet the conditions prescribed by paragraph
86(1)(a) or (b), or
(b) is not being implemented,
the Tribunal may make an order directing that the agreement or modi-
fication thereof, and any order relating thereto, be removed from the
register.
88. Right of intervention — The attorney general of a province may
intervene in any proceedings before the Tribunal under section 86 or 87
for the purpose of making representations on behalf of the province.
89. (1) Register of specialization agreements — The Tribunal shall
cause to be maintained at its Registry established pursuant to subsec-
411
tion 14(1) of the Competition Tribunal Act a register of specialization

agreements, and modifications thereof, that the Tribunal has directed
be registered, and any such agreements and modifications thereof shall
be included in the register for the periods specified in the orders.
(2) Public access to register — The register shall be kept open to
inspection by any person during normal business hours of the Tribunal.
90. Non-application of sections 45 and 77 — Section 45, and section
77 as it applies to exclusive dealing, do not apply in respect of a speciali-
zation agreement, or any modification thereof, that is registered.
Mergers
91. Definition of “merger” — In sections 92 to 100, “merger” means
the acquisition or establishment, direct or indirect, by one or more per-
sons, whether by purchase or lease of shares or assets, by amalgama-
tion or by combination or otherwise, of control over or significant in-
terest in the whole or a part of a business of a competitor, supplier,
customer or other person.
92. (1) Order — Where, on application by the Director, the Tribunal
finds that a merger or proposed merger prevents or lessens, or is likely
to prevent or lessen, competition substantially
(a) in a trade, industry or profession,
(b) among the sources from which a trade, industry or profession
obtains a product,
(c) among the outlets through which a trade, industry or profes-
sion disposes of a product, or
(d) otherwise than as described in paragraphs (a) to (c),
the Tribunal may, subject to sections 94 to 96,
(e) in the case of a completed merger, order any party to the
merger or any other person
(i) to dissolve the merger in such manner as the Tribunal
directs,
(ii) to dispose of assets or shares designated by the Tribunal in
such manner as the Tribunal directs, or
(iii) in addition to or in lieu of the action referred to in sub-
paragraph (i) or (ii), with the consent of the person against
whom the order is directed and the Director, to take any other
action, or
(f) in the case of a proposed merger, make an order directed
against any party to the proposed merger or any other person
(i) ordering the person against whom the order is directed not
to proceed with the merger,
412
(ii) ordering the person against whom the order is directed

not to proceed with a part of the merger, or
(iii) in addition to or in lieu of the order referred to in subpar-
agraph (ii), either or both
(A) prohibiting the person against whom the order is di-
rected, should the merger or part thereof be completed,
from doing any act or thing the prohibition of which the
Tribunal determines to be necessary to ensure that the
merger or part thereof does not prevent or lessen compe-
tition substantially, or
(B) with the consent of the person against whom the or-
der is directed and the Director, ordering the person to
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take any other action.
(2) Evidence — For the purpose of this section, the Tribunal shall not
find that a merger or proposed merger prevents or lessens, or is likely
to prevent or lessen, competition substantially solely on the basis of evi-
dence of concentration or market share.
93. Factors to be considered regarding prevention or lessening
of competition — In determining, for the purpose of section 92,
whether or not a merger or proposed merger prevents or lessens, or is
likely to prevent or lessen, competition substantially, the Tribunal may
have regard to the following factors:
(a) the extent to which foreign products or foreign competitors
provide or are likely to provide effective competition to the busi-
nesses of the parties to the merger or proposed merger;
(b) whether the business, or a part of the business, of a party to the
merger or proposed merger has failed or is likely to fail;
(c) the extent to which acceptable substitutes for products supplied
by the parties to the merger or proposed merger are or are likely
to be available;
(d) any barriers to entry into a market, including
(iii) regulatory control over entry,
and any effect of the merger or proposed merger on such barriers;
(e) the extent to which effective competition remains or would re-
main in a market that is or would be affected by the merger or
proposed merger;
(f) any likelihood that the merger or proposed merger will or
would result in the removal of a vigorous and effective competitor;
(g) the nature and extent of change and innovation in a relevant
market; and
413
(h) any other factor that is relevant to competition in a market that

is or would be affected by the merger or proposed merger.
94. Exception — The Tribunal shall not make an order under section
92 in respect of
(a) a merger substantially completed before the coming into force
of this section; or
(b) an amalgamation or proposed amalgamation under section 255
of the Bank Act, or an acquisition or proposed acquisition of assets
under section 273 of the Bank Act, in respect of which the Minister
of Finance has certified to the Director the names of the parties
thereto and that the amalgamation or acquisition is desirable in
the interest of the financial system.
95. (1) Exception for joint ventures — The Tribunal shall not make
an order under section 92 in respect of a combination formed or pro-
posed to be formed, otherwise than through a corporation, to under-
take a specific project or a program of research and development if
(a) a project or program of that nature
(i) would not have taken place or be likely to take place in the
absence of the combination, or
(ii) would not reasonably have taken place or reasonably be
likely to take place in the absence of the combination because
of the risks involved in relation to the project or program and
the business to which it relates;
(b) no change in control over any party to the combination re-
sulted or would result from the combination;
(c) all the persons who formed the combination are parties to an
agreement in writing that imposes on one or more of them an obli-
gation to contribute assets and governs a continuing relationship
between those parties;
(d) the agreement referred to in paragraph (c) restricts the range
of activities that may be carried on pursuant to the combination,
and provides that the agreement terminates on the completion of
the project or program; and
(e) the combination does not prevent or lessen or is not likely to
prevent or lessen competition except to the extent reasonably re-
quired to undertake and complete the project or program.
(2) Limitation — For greater certainty, this section does not apply in
respect of the acquisition of assets of a combination.
96. (1) Exception where gains in efficiency — The Tribunal shall
not make an order under section 92 if it finds that the merger or pro-
posed merger in respect of which the application is made has brought
about or is likely to bring about gains in efficiency that will be greater
414
than, and will offset, the effects of any prevention or lessening of com-
petition that will result or is likely to result from the merger or pro-
posed merger and that the gains in efficiency would not likely be at-
tained if the order were made.
(2) Factors to be considered — In considering whether a merger or
proposed merger is likely to bring about gains in efficiency described in
subsection (1), the Tribunal shall consider whether such gains will re-
sult in
(b) a significant substitution of domestic products for imported
products.
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(3) Restriction — For the purposes of this section, the Tribunal shall
not find that a merger or proposed merger has brought about or is
likely to bring about gains in efficiency by reason only of a redistribu-
tion of income between two or more persons.
97. Limitation period — No application may be made under section 92
in respect of a merger more than three years after the merger has been
substantially completed.
98. Where proceedings commenced under section 45 or 79 — No
application may be made under section 92 against a person
(a) against whom proceedings have been commenced under section
45, or
(b) against whom an order is sought under section 79
on the basis of the same or substantially the same facts as would be
alleged in the proceedings under section 45 or 79, as the case may be.
99. (1) Conditional orders directing dissolution of a merger —
The Tribunal may provide, in an order made under section 92 directing
a person to dissolve a merger or to dispose of assets or shares, that the
order may be rescinded or varied if, within a reasonable period of time
specified in the order,
(a) there has occurred
(i) a reduction, removal or remission, specified in the order, of
any relevant customs duties, or
(ii) a reduction or removal, specified in the order, of prohibi-
tions, controls or regulations imposed by or pursuant to any
Act of Parliament on the importation into Canada of an arti-
cle specified in the order, or
(b) that person or any other person has taken any action specified
in the order
that will, in the opinion of the Tribunal, prevent the merger from
preventing or lessening competition substantially.
415
(2) When conditional order may be rescinded or varied — Where,

on application by any person against whom an order under section 92
is directed, the Tribunal is satisfied that
(a) a reduction, removal or remission specified in the order pursu-
ant to paragraph (1)(a) has occurred, or
(b) the action specified in the order pursuant to paragraph (1)(b)
has been taken,
100. (1) Interim order where no application under section 92 —
Where, on application by the Director, the Tribunal finds, in respect of
a proposed merger in respect of which an application has not been
made under section 92 or previously under this section, that
(a) the proposed merger is reasonably likely to prevent or lessen
competition substantially and, in the opinion of the Tribunal, in
the absence of an interim order a party to the proposed merger or
any other person is likely to take an action that would substantially
impair the ability of the Tribunal to remedy the effect of the pro-
posed merger on competition under section 92 because that action
would be difficult to reverse, or
(b) there has been a failure to comply with section 114 in respect of
the proposed merger,
the Tribunal may issue an interim order forbidding any person named
in the application from doing any act or thing that it appears to the
Tribunal may constitute or be directed toward the completion or imple-
mentation of the proposed merger.
(2) Notice of application — Subject to subsection (3), at least forty-
eight hours notice of an application for an interim order under subsec-
tion (1) shall be given by or on behalf of the Director to each person
against whom the order is sought.
(3) Ex parte application — Where the Tribunal is satisfied, in respect
of an application made under subsection (1), that
(a) subsection (2) cannot reasonably be complied with, or
(b) the urgency of the situation is such that service of notice in ac-
cordance with subsection (2) would not be in the public interest,
it may proceed with the application ex parte.
(4) Terms of interim order — An interim order issued under subsec-
tion (1)
(a) shall be on such terms as the Tribunal considers necessary and
sufficient to meet the circumstances of the case; and
(b) subject to subsection (5), shall have effect for such period of
time as is specified therein.
416
(5) Maximum duration of interim order — An interim order issued

under subsection (1) in respect of a proposed merger shall cease to have
effect
(a) in the case of an interim order issued on ex parte application,
not later than ten days, or
(b) in any other case, not later than twenty-one days,
after the interim order comes into effect or, in the circumstances re-
ferred to in paragraph (1)(b), after section 114 is complied with.
(6) Duty of Director — Where an interim order is issued under para-
graph (1)(a), the Director shall proceed as expeditiously as possible to
commence and complete proceedings under section 92 in respect of the
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proposed merger.
101. Right of intervention — The attorney general of a province may
intervene in any proceedings before the Tribunal under section 92 for
the purpose of making representations on behalf of the province.
102. (1) Advance ruling certificates — Where the Director is satis-
fied by a party or parties to a proposed transaction that he would not
have sufficient grounds on which to apply to the Tribunal under section
92, the Director may issue a certificate to the effect that he is so
satisfied.
(2) Duty of Director — The Director shall consider any request for a
certificate under this section as expeditiously as possible.
103. No application under section 92 — Where the Director issues a
certificate under section 102, the Director shall not, if the transaction to
which the certificate relates is substantially completed within one year
after the certificate is issued, apply to the Tribunal under section 92 in
respect of the transaction solely on the basis of information that is the
same or substantially the same as the information on the basis of which
the certificate was issued.
General
104. (1) Interim order — Where an application has been made for an
order under this Part, other than an interim order under section 100,
the Tribunal, on application by the Director, may issue such interim
order as it considers appropriate, having regard to the principles ordi-
narily considered by superior courts when granting interlocutory or in-
junctive relief.
(2) Terms of interim order — An interim order issued under subsec-
tion (1) shall be on such terms, and shall have effect for such period of
time, as the Tribunal considers necessary and sufficient to meet the cir-
cumstances of the case.
417
(3) Duty of director — Where an interim order issued under subsec-

tion (1) is in effect, the Director shall proceed as expeditiously as possi-
ble to complete proceedings under this Part arising out of the conduct
in respect of which the order was issued.
105. Consent orders — Where an application is made to the Tribunal
under this Part for an order and the Director and the person in respect
of whom the order is sought agree on the terms of the order, the Tribu-
nal may make the order on those terms without hearing such evidence
as would ordinarily be placed before the Tribunal had the application
been contested or further contested.
106. Rescission or variation of order — Where, on application by
the Director or a person against whom an order has been made under
this Part, the Tribunal finds that
(a) the circumstances that led to the making of the order have
changed and, in the circumstances that exist at the time the appli-
cation is made under this section, the order would not have been
made or would have been ineffective to achieve its intended pur-
pose, or
(b) the Director and the person against whom an order has been
made have consented to an alternative order,
107. Evidence — In determining whether or not to make an order
under this Part, the Tribunal shall not exclude from consideration any
evidence by reason only that it might be evidence in respect of an of-
fence under this Act or in respect of which another order could be
made by the Tribunal under this Act.
PART IX — NOTIFIABLE TRANSACTIONS

Interpretation
108. (1) Definitions — In this Part,
“operating business” means a business undertaking in Canada to which
employees employed in connection with the undertaking ordinarily re-
port for work; (“entreprise...”)
“person” means an individual, body corporate, unincorporated syndi-
cate, unincorporated organization, trustee, executor, administrator or
other legal representative, but does not include a bare trustee;
(“personne”)
“prescribed” means prescribed by regulation of the Governor in Coun-
cil; (“Version anglaise seulement”)
“voting share” means any share that carries voting rights under all cir-
cumstances or by reason of an event that has occurred and is continu-
ing. (“actions...”)
418
(2) Corporations controlled by Her Majesty — For the purposes of

this Part, except for the purposes of section 113, one corporation is not
affiliated with another corporation by reason only of the fact that both
corporations are controlled by Her Majesty in right of Canada or a
province, as the case may be.
Application
109. (1) General limit relating to parties — This Part does not apply
in respect of a proposed transaction unless the parties thereto, together
with their affiliates,
(a) have assets in Canada that exceed four hundred million dollars
in aggregate value, determined as of such time and in such manner
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as may be prescribed, or such greater amount as may be pre-
scribed; or
(b) had gross revenues from sales in, from or into Canada, deter-
mined for such annual period and in such manner as may be pre-
scribed, that exceed four hundred million dollars in aggregate
value, or such greater amount as may be prescribed.
(2) Parties to acquisition of shares — For the purpose of subsection
(1), with respect to a proposed acquisition of shares, the parties to the
transaction are the person or persons who propose to acquire the
shares and the corporation the shares of which are to be acquired.
110. (1) Application of Part — This Part applies only in respect of
proposed transactions described in this section.
(2) Acquisition of assets — Subject to sections 111 and 113, this Part
applies in respect of a proposed acquisition of any of the assets in Can-
ada of an operating business where the aggregate value of those assets,
determined as of such time and in such manner as may be prescribed,
or the gross revenues from sales in or from Canada generated from
those assets, determined for such annual period and in such manner as
may be prescribed, would exceed thirty-five million dollars or such
greater amount as may be prescribed.
(3) Acquisition of shares — Subject to sections 111 and 113, this Part
applies in respect of a proposed acquisition of voting shares of a corpo-
ration that carries on an operating business or controls a corporation
that carries on an operating business
(a) where
(i) the aggregate value of the assets in Canada, determined as
of such time and in such manner as may be prescribed, that
are owned by the corporation or by corporations controlled
by that corporation, other than assets that are shares of any of
those corporations, would exceed thirty-five million dollars, or
such greater amount as may be prescribed, or
419
(ii) the gross revenues from sales in or from Canada, deter-

mined for such annual period and in such manner as may be
prescribed, generated from the assets referred to in subpara-
graph (i) would exceed thirty-five million dollars, or such
greater amount as may be prescribed, and
(b) where, as a result of the proposed acquisition of the voting
shares, the person or persons acquiring the shares, together with
their affiliates, would own voting shares of the corporation that in
the aggregate carry more than
(i) twenty per cent or, if the person or persons own twenty per
cent or more before the proposed acquisition, fifty per cent of
the votes attached to all outstanding voting shares of the cor-
poration, in the case of the acquisition of voting shares of a
corporation any of the voting shares of which are publicly
traded, or
(ii) thirty-five per cent or, if the person or persons own thirty-
five per cent or more before the proposed acquisition, fifty per
cent of the votes attached to all outstanding voting shares of
the corporation, in the case of the acquisition of voting shares
of a corporation none of the voting shares of which are pub-
licly traded.
(4) Amalgamation — Subject to section 113, this Part applies in re-
spect of a proposed amalgamation of two or more corporations where
one or more of those corporations carries on an operating business or
controls a corporation that carries on an operating business where
(a) the aggregate value of the assets in Canada, determined as of
such time and in such manner as may be prescribed, that would be
owned by the continuing corporation that would result from the
amalgamation or by corporations controlled by the continuing cor-
poration, other than assets that are shares of any of those corpora-
tions, would exceed seventy million dollars, or such greater
amount as may be prescribed; or
(b) the gross revenues from sales in or from Canada, determined
for such annual period and in such manner as may be prescribed,
generated from the assets referred to in paragraph (a) would ex-
ceed seventy million dollars, or such greater amount as may be
prescribed.
(5) Combination — Subject to sections 112 and 113, this Part applies
in respect of a proposed combination of two or more persons to carry
on business otherwise than through a corporation where one or more of
those persons propose to contribute to the combination assets that form
420
all or part of an operating business carried on by those persons, or cor-

porations controlled by those persons, and where
(a) the aggregate value of the assets in Canada, determined as of
such time and in such manner as may be prescribed, that are the
subject-matter of the combination would exceed thirty-five million
dollars, or such greater amount as may be prescribed; or
(b) the gross revenues from sales in or from Canada, determined
for such annual period and in such manner as may be prescribed,
generated from the assets referred to in paragraph (a) would ex-
ceed thirty-five million dollars, or such greater amount as may be
prescribed.
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Exemptions
Acquisitions of Voting Shares or Assets
111. Acquisitions — The following classes of transactions are exempt
from the application of this Part:
(a) an acquisition of real property or goods in the ordinary course
of business if the person or persons who propose to acquire the
assets would not, as a result of the acquisition, hold all or substan-
tially all of the assets of a business or of an operating segment of a
business;
(b) an acquisition of voting shares solely for the purpose of under-
writing the shares, within the meaning of subsection 5(2);
(c) an acquisition of voting shares or assets that would result from
a gift, intestate succession or testamentary disposition;
(d) an acquisition of collateral or receivables, or an acquisition re-
sulting from a foreclosure or default or forming part of a debt
work-out, made by a creditor in or pursuant to a credit transac-
tion entered into in good faith in the ordinary course of business;
(e) an acquisition of a Canadian resource property, as defined in
paragraph 66(15)(c) of the Income Tax Act, pursuant to an agree-
ment in writing that provides for the transfer of that property to
the person or persons acquiring the property only if the person or
persons acquiring the property incur expenses to carry out explo-
ration or development activities with respect to the property; and
(f) an acquisition of voting shares of a corporation pursuant to an
agreement in writing that provides for the issuance of those shares
only if the person or persons acquiring them incur expenses to
carry out exploration or development activities with respect to a
Canadian resource property, as defined in paragraph 66(15)(c) of
the Income Tax Act, in respect of which the corporation has the
right to carry out those activities where the corporation does not
have any significant assets other than that property.
421
Combinations
112. Combinations that are joint ventures — A combination is ex-
empt from the application of this Part if
(a) all the persons who propose to form the combination are par-
ties to an agreement in writing or intended to be put in writing
that imposes on one or more of them an obligation to contribute
assets and governs a continuing relationship between those parties;
(b) no change in control over any party to the combination would
result from the combination; and
(c) the agreement referred to in paragraph (a) restricts the range
of activities that may be carried on pursuant to the combination,
and contains provisions that would allow for its orderly
termination.
General
113. General exemptions — The following classes of transactions are
exempt from the application of this Part:
(a) a transaction all the parties to which are affiliates of each
other;
(b) a transaction in respect of which the Director has issued a cer-
tificate under section 102;
(c) a transaction pursuant to an agreement entered into before this
section comes into force but substantially completed within one
year after this section comes into force; and
(d) such other classes of transactions as may be prescribed.
114. (1) Notice of proposed transaction — Subject to this Part,
where
(a) a person, or two or more persons pursuant to an agreement or
arrangement, propose to acquire assets in the circumstances set
out in subsection 110(2) or to acquire shares in the circumstances
set out in subsection 110(3),
(b) two or more corporations propose to amalgamate in the cir-
cumstances set out in subsection 110(4), or
(c) two or more persons propose to form a combination in the cir-
cumstances set out in subsection 110(5),
the person or persons who are proposing the transaction shall, before
completing the transaction, notify the Director that the transaction is
proposed and supply the Director with information in accordance with
section 120.
422
(2) Who may give notice and supply information — Where more
than one person is required to give notice and supply information
under this section in respect of the same transaction, any of those per-
sons who is duly authorized to do so may give notice or supply informa-
tion on behalf of and in lieu of any of the others, and any of those per-
sons may give notice and supply information jointly.
115. (1) Prior notice of acquisitions of voting shares — It is not
necessary to comply with section 114 in respect of a proposed acquisi-
tion of voting shares where a limit set out in subsection 110(3) would be
exceeded as a result of the proposed acquisition within three years im-
mediately following a previous compliance with section 114 required in
relation to the same limit.
Tribunal Act
(2) Notice of future acquisition of voting shares — Where a person
or persons who propose to acquire voting shares are required to com-
ply with section 114 because the twenty or thirty-five per cent limit set
out in subsection 110(3) would be exceeded as a result of the acquisi-
tion, the person or persons may, at the time of the compliance, give
notice to the Director of a proposed further acquisition of voting shares
that would result in a fifty per cent limit set out in that subsection being
exceeded, and supply the Director with a detailed description in writing
of the steps to be carried out in the further acquisition.
(3) Exemption for further acquisitions of voting shares — It is not
necessary to comply with section 114 in respect of a proposed further
acquisition referred to in subsection (2) if
(a) notice of the further acquisition is given to the Director under
subsection (2) and it is carried out in accordance with the descrip-
tion supplied under that subsection; and
(b) an additional notice of the further acquisition is given to the
Director in writing within twenty-one, and at least seven, days
before the further acquisition.
(4) Limitation — Subsection (3) does not apply in respect of a further
acquisition unless the further acquisition is completed within one year
after notice of it is given under subsection (2).
116. (1) Where information cannot be supplied — If any of the in-
formation required under section 114 is not known or reasonably ob-
tainable, or cannot be obtained without breaching a confidentiality re-
quirement established by law or without creating a significant risk that
confidential information will be used for an improper purpose or that
information that should, for commercial reasons, be kept confidential
will be disclosed to the public, the person who is supplying the informa-
tion may, in lieu of supplying the information, inform the Director
under oath or solemn affirmation of the matters in respect of which
information has not been supplied and why it has not been obtained.
423
(2) Where information not relevant — If any of the information re-

quired under section 114 could not, on any reasonable basis, be consid-
ered to be relevant to an assessment by the Director as to whether the
proposed transaction would or would be likely to prevent or lessen
competition substantially, the person who is supplying the information
may, in lieu of supplying the information, inform the Director under
oath or solemn affirmation of the matters in respect of which informa-
tion has not been supplied and why the information was not considered
relevant.
(3) Director may require information — Where a person chooses not
to supply the Director with information required under section 114 and
so informs the Director in accordance with subsection (2) and the Di-
rector notifies that person within seven days after the Director is so
informed that he requires the information, the person shall supply the
Director with the information.
117. (1) Saving — Nothing in section 114 requires any person who is a
director of a corporation to supply information that is known to that
person by virtue only of his position as a director of an affiliate of the
corporation that is neither a wholly-owned affiliate nor a wholly-own-
ing affiliate of the corporation.
(2) Wholly-owned affiliate — For the purposes of subsection (1), one
corporation is the wholly-owned affiliate of another corporation if all
its outstanding voting shares, other than shares necessary to qualify
persons as directors, are beneficially owned by that other corporation
directly, or indirectly through one or more affiliates where all the out-
standing voting shares of the affiliates, other than shares necessary to
qualify persons as directors, are beneficially owned by that other cor-
poration or each other.
(3) Wholly-owning affiliate — For the purposes of subsection (1), one
corporation is the wholly-owning affiliate of another corporation if it
beneficially owns all the outstanding voting shares of that other corpo-
ration, other than shares necessary to qualify persons as directors, di-
rectly, or indirectly through one or more affiliates where all the out-
standing voting shares of the affiliates, other than shares necessary to
qualify persons as directors, are beneficially owned by the corporation
or each other.
118. Information to be certified — The information supplied to the
Director under section 114 shall be certified on oath or solemn
affirmation
(a) in the case of a corporation supplying the information, by an
officer thereof or other person duly authorized by the board of di-
rectors or other governing body of the corporation, or
(b) in the case of any other person supplying the information, by
that person,
424
as having been examined by that person and as being, to the best of his
knowledge and belief, correct and complete in all material respects.
119. Where transaction not completed — Where notice is given and
information supplied in respect of a proposed transaction under section
114 but the transaction is not completed within one year thereafter or
such longer period as the Director may specify in any particular case,
section 114 applies as if no notice were given or information supplied.
Information Required
120. Information required — The information required under section
114 is, at the option of the person supplying the information,
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(a) the information set out in section 121, or
(b) the information set out in section 122,
but, where the person supplying the information chooses to supply the
Director with the information referred to in paragraph (a) and the Di-
rector notifies that person within seven days after the day on which he
receives the information that he requires the information referred to in
paragraph (b), the information referred to in paragraph (b) is required
as well.
121. Information referred to in paragraph 120(a) — The informa-
tion referred to in paragraph 120(a) is
(a) a description of the proposed transaction and the business
objectives intended to be achieved as a result thereof;
(b) copies of the legal documents, or the most recent drafts thereof
if the documents have not been executed, that are to be used to
implement the proposed transaction; and
(c) in respect of each person who is required to supply the infor-
mation and, in the case of information required under paragraph
114(1)(a), the corporation the shares of which or the person the
assets of whom are proposed to be acquired,
(i) their full names,
(ii) the addresses of their principal offices and, in the case of a
corporation, the jurisdiction under which it was incorporated,
(iii) a list of their affiliates that have significant assets in Can-
ada or significant gross revenues from sales in, from or into
Canada and a chart describing the relationships between
themselves and those affiliates,
(iv) a summary description of their principal businesses and
the principal businesses of their affiliates referred to in sub-
paragraph (iii), including statements identifying the current
principal suppliers and customers of those principal busi-
425
nesses and the annual volume of purchases from and sales to

those suppliers and customers,
(v) statements of
(A) their gross and net assets as of the end of their most
recently completed fiscal year, and
(B) their gross revenues from sales for that year,
(vi) in so far as the information is known, or reasonably avail-
able, a copy of every proxy solicitation circular, prospectus
and other information form filed with a securities commis-
sion, stock exchange or other similar authority in Canada or
elsewhere or sent or otherwise made available to shareholders
within the previous two years, and
(vii) to the extent available, financial statements of
(A) the acquiring party, in the case of a proposed trans-
action referred to in paragraph 114(1)(a),
(B) the continuing corporation, in the case of a proposed
transaction referred to in paragraph 114(1)(b), or
(C) the combination, in the case of a proposed transac-
tion referred to in paragraph 114(1)(c),
prepared on a pro forma basis as if the proposed transaction
had occurred previously.
122. Information referred to in paragraph 120(b) — The informa-
tion referred to in paragraph 120(b) is
(a) a description of the proposed transaction and the business
objectives intended to be achieved as a result thereof;
(b) copies of the legal documents, or the most recent drafts thereof
if the documents have not been executed, that are to be used to
implement the proposed transaction;
(c) in respect of each person who is required to supply the infor-
mation, each of their wholly-owned affiliates or wholly-owning af-
filiates that has significant assets in Canada or significant sales in,
from or into Canada and, in the case of information required
under paragraph 114(1)(a), the corporation the shares of which or
the person the assets of whom are proposed to be acquired,
(i) their full names,
(ii) the addresses of their principal offices and, in the case of a
corporation, the jurisdiction under which it was incorporated,
(iii) the names and business addresses of their directors and
officers,
426
(iv) a summary description of their principal businesses

including
(A) to the extent available, financial statements relating
to their principal businesses for their most recently com-
pleted fiscal year and subsequent interim periods, and
(B) statements identifying the principal current suppliers
and customers of their principal businesses and the an-
nual volume of purchases from and sales to such suppli-
ers and customers,
(v) statements of
(A) their gross and net assets as of the end of their most
Tribunal Act
recently completed fiscal year, and
(B) their gross revenues from sales for that year,
(vi) the principal categories of products produced, supplied or
distributed by each of them and their gross sales for each
principal category of product, for their most recently com-
pleted fiscal year,
(vii) the principal categories of products purchased or ac-
quired by each of them and their total expenditures for each
principal category of product, for their most recently com-
pleted fiscal year,
(viii) the number of votes attached to voting shares held, di-
rectly or indirectly through one or more affiliates or other-
wise, by each of them in any corporation carrying on an oper-
ating business, whether through one or more subsidiaries or
otherwise, where the total of all votes attached to shares so
held exceeds twenty per cent of the votes attached to all out-
standing voting shares of the corporation,
(ix) a copy of every proxy solicitation circular, prospectus and
other information form filed with a securities commission,
stock exchange or other similar authority in Canada or else-
where or sent or otherwise made available to shareholders
within the previous two years,
(x) financial or statistical data prepared to assist the board of
directors or senior officers of any of them in analyzing the
proposed transaction, including, to the extent that opinions or
judgments are not contained therein, any such data that is
contained in any part of a study or report,
(xi) to the extent available, financial statements of
(A) the acquiring party, in the case of a proposed trans-
action referred to in paragraph 114(1)(a),
(B) the continuing corporation, in the case of a proposed
transaction referred to in paragraph 114(1)(b), or
427
(C) the combination, in the case of a proposed transac-

tion referred to in paragraph 114(1)(c),
prepared on a pro forma basis as if the proposed transaction
had occurred previously, and
(xii) if any of them have taken a decision or entered into a
commitment or undertaking to make significant changes in
any business to which the proposed transaction relates, a sum-
mary description of that decision, commitment or undertak-
ing; and
(d) in respect of any affiliate of each person who is required to
supply the information, other than a wholly-owned affiliate or
wholly-owning affiliate of such a person, that has significant assets
in, or significant gross revenues from sales in, from or into Can-
ada, the information set out in subparagraphs (c)(v) to (xii).
123. Time within which transaction cannot proceed — A proposed
transaction referred to in section 114 shall not be completed before the
expiration of
(a) seven days after the day on which the information required
under section 114, certified under section 118, has been received
by the Director, where the person supplying the information has
chosen to supply the Director with the information set out in sec-
tion 121 and the Director has not, within that time, required the
information set out in section 122,
(b) except as provided in paragraph (c), twenty-one days after the
day on which the information required under section 114, certified
under section 118, has been received by the Director, where the
person supplying the information has chosen, or is required, to
supply the Director with the information set out in section 122, or
(c) where the proposed transaction is an acquisition of voting
shares that is to be effected through the facilities of a stock ex-
change in Canada and the information supplied is the information
set out in section 122, ten trading days, or such longer period of
time, not exceeding twenty-one days, as may be allowed by the
rules of the stock exchange before shares must be taken up, after
the day on which the information required under section 114, cer-
tified under section 118, has been received by the Director,
unless the Director, before the expiration of that time, notifies the per-
sons who are required to give notice and supply information that the
Director does not, at that time, intend to make an application under
section 92 in respect of the proposed transaction.
428
Regulations
124. (1) Regulations — The Governor in Council may make regula-
tions prescribing anything that is by this Part to be prescribed.
Tribunal Act
PART X — GENERAL
Representations to Boards, Commissions or Other
Tribunals
125. (1) Representations to federal boards, etc. — The Director, at
the request of any federal board, commission or other tribunal or on
his own initiative, may, and on direction from the Minister shall, make
representations to and call evidence before the board, commission or
other tribunal in respect of competition, whenever such representations
are, or evidence is, relevant to a matter before the board, commission
or other tribunal, and to the factors that the board, commission or
other tribunal is entitled to take into consideration in determining the
matter.
(2) Definition of “federal board, commission or other tribunal” —
For the purposes of this section, “federal board, commission or other
tribunal” means any board, commission, tribunal or person that carries
on regulatory activities and is expressly charged by or pursuant to an
enactment of Parliament with the responsibility of making decisions or
recommendations related directly or indirectly to the production, sup-
ply, acquisition or distribution of a product.
126. (1) Representations to provincial boards, etc. — The Director,
at the request of any provincial board, commission or other tribunal, or
on his own initiative with the consent of the board, commission or other
tribunal, may make representations to and call evidence before the
board, commission or other tribunal in respect of competition, when-
ever such representations are, or evidence is, relevant to a matter
before the board, commission or other tribunal, and to the factors that
the board, commission or other tribunal is entitled to take into consid-
eration in determining the matter.
429
(2) Definition of “provincial board, commission or other tribu-

nal” — For the purposes of this section, “provincial board, commission
or other tribunal” means any board, commission, tribunal or person
that carries on regulatory activities and is expressly charged by or pur-
suant to an enactment of the legislature of a province with the responsi-
bility of making decisions or recommendations related directly or indi-
rectly to the production, supply, acquisition or distribution of a
product.
127. Annual report — The Director shall report annually to the Min-
ister on the proceedings under this Act, and the Minister shall cause the
report to be laid before each House of Parliament on any of the first
fifteen days after the Minister receives the report on which that House
is sitting.
Regulations
128. (1) Regulations — The Governor in Council may make such reg-
ulations as are necessary for carrying out this Act and for the efficient
administration thereof.
PART III — CONSEQUENTIAL AMENDMENTS (SS. 46–59)

Access to Information Act [R.S., c. A-1]
46. (1) Schedule I to the Access to Information Act is amended by deleting
therefrom the reference to
Restrictive Trade Practices Commission
Commission sur les pratiques restrictives du commerce
(2) Schedule I to the said Act is further amended by adding thereto, in alpha-
betical order, under the heading “Other Government Institutions”, a reference
to
430
Part III — Consequential Amendments (ss. 46–59) S. 49
Office of the Director of Investigation and Research

Bureau du directeur des enquêtes et recherches
(3) Schedule II to the said Act is amended by adding thereto, in alphabetical
order, a reference to
Competition Act
Loi sur la concurrence
and by adding a corresponding reference in respect of that Act to “subsection
29(1)”.
Bank Act [R.S., c. B-1]
Tribunal Act
47. Paragraph 255(5)(a) of the Bank Act is repealed.
48. The heading preceding section 309 and section 309 of the said Act are
repealed.
Energy Supplies Emergency Act [R.S., c. E-9]

49. Subsections 33(1) to (3) of the Energy Supplies Emergency Act are repealed
and the following substituted therefor:
33. (1) Application for exemption — Where, in order to comply with
any request in writing from the Minister to develop an implementation
plan or arrangement in relation to this Act or with any regulation
under this Act, a person would be required to enter into any agree-
ment, arrangement or course of action that might cause him to contra-
vene the Competition Act, that person may apply to the Board for an
order exempting him from that Act in respect of that particular agree-
ment, arrangement or course of action.
(2) Consultation with Minister of Consumer and Corporate Af-
fairs — In considering an application under subsection (1), the Board
shall consult with the Minister of Consumer and Corporate Affairs re-
garding the extent to which the agreement, arrangement or course of
action in respect of which application is made for exemption from the
Competition Act would create or maintain restrictive trade practices or
situations inconsistent with the Competition Act.
(3) Exemption Order — After consulting with the Minister of Con-
sumer and Corporate Affairs regarding any alternative agreement, ar-
rangement or course of action that would avoid or overcome or miti-
gate any restrictive trade practices or situations inconsistent with the
Competition Act, the Board may, by order, exempt the applicant and
such other persons as it deems necessary from the provisions of the
Competition Act in respect of any agreement, arrangement or course of
action described in the exemption order, and thereupon that Act does
431
not apply in respect of the described agreement, arrangement or course

of action.
Farm Products Marketing Agencies Act [R.S., c. F-4]

50. Section 32 of the Farm Products Marketing Agencies Act is repealed and the
32. Competition Act not to apply — Nothing in the Competition Act
applies to any contract, agreement or other arrangement between an
agency and any person or persons engaged in the production or mar-
keting of a regulated product where the agency has authority under
this or any other Act, under a proclamation issued under this Act or
under an agreement entered into pursuant to section 31 of this Act to
enter into such an arrangement.
National Transportation Act [R.S., c. N-20]

51. (1) Subsection 30(2) of the National Transportation Act is repealed and the
(2) Publication — The Commission shall give or cause to be given such
public or other notice of any proposed acquisition referred to in subsec-
tion (1) as to it appears to be reasonable in the circumstances, including
notice to the Director of Investigation and Research under the Competi-
tion Act.
ing subsection:
(6) Effect on operation of other Acts — Nothing in this section af-
fects the operation of any other Act of Parliament that applies to or in
respect of any acquisition of an interest in the business, or any part of
the business, of any company.
Privacy Act [R.S., c. P-21]

52. (1) The schedule to the Privacy Act is amended by deleting therefrom the
reference to
(2) The schedule to the said Act is further amended by adding thereto, in al-
phabetical order, under the heading “Other Government Institutions”, a refer-
ence to
Office of the Director of Investigation and Research
Bureau du directeur des enquêtes et recherches
432
Part III — Consequential Amendments (ss. 46–59) S. 56
Public Service Staff Relations Act [R.S., c. P-35]

53. Part I of Schedule I to the Public Service Staff Relations Act is amended by
adding thereto, in alphabetical order, a reference to
Competition Tribunal
Tribunal de la concurrence
Public Service Superannuation Act [R.S., c. P-36]

54. (1) Part I of Schedule I to the Public Service Superannuation Act is
amended by adding thereto, in alphabetical order, a reference to
Tribunal Act
Tribunal de la concurrence
(2) Part I of Schedule I to the said Act is further amended by deleting there-
from, effective on the repeal of subsection 60(1), the reference to
(3) Part III of Schedule I to the said Act is amended by adding thereto, in
alphabetical order, effective on the repeal of subsection 60(1), a reference to
Shipping Conferences Exemption Act [R.S., c. S-10]

55. The definition “Director” in section 2 of the Shipping Conferences Exemp-
tion Act is repealed and the following substituted therefor:
“Director” means the Director of Investigation and Research appointed
under the Competition Act; (“directeur”)
56. The heading preceding section 5 and all that portion of subsection 5(1) of
the said Act preceding paragraph (a) thereof is repealed and the following
NON-APPLICATION OF THE COMPETITION ACT

5. (1) Competition Act not to apply to certain contracts, etc. —
Subject to section 6, the Competition Act does not apply to any contract,
agreement or arrangement between members of a conference, between
the members of a conference and those of another conference or be-
tween the members of a conference and an ocean carrier that is not a
member thereof to the extent that the contract, agreement or
arrangement
433
for:
12. (1) Inquiry by Director — Notwithstanding section 3, the Director
on his own initiative may, and on direction from the Minister of Con-
sumer and Corporate Affairs shall, carry out an inquiry concerning the
operations of any shipping conference and the effect that practices of
the conference have in limiting facilities for the transportation of any
goods, preventing or lessening competition in the transportation of any
goods or restraining or injuring trade or commerce in relation to any
goods.
(2) Minister or Commission to consider evidence or material —
Any inquiry carried out by the Director pursuant to subsection (1) shall
be deemed to be an inquiry under section 10 of the Competition Act and
the Minister of Consumer and Corporate Affairs or the Commission
shall consider any evidence or material brought by the Director, to-
gether with such further evidence and material as the Minister or the
Commission, as the case may be, considers advisable, and, in the case of
the Commission, shall report thereon to the Minister.
therefor:
(2) Payment out of money or security — Where an ocean carrier
described in subsection (1) is convicted of an offence under this Act or
the Competition Act and fails to pay any fine imposed on it, the Com-
mission may pay that fine out of any money, or from the proceeds of
the sale of any security, deposited by that ocean carrier pursuant to
subsection (1).
General
59. (1) References to s. 114 of Canada Corporations Act — Wher-
ever in any Act of Parliament a reference is made to section 114 of the Canada
Corporations Act, chapter C-32 of the Revised Statutes of Canada, 1970, in re-
spect of a company or corporation, sections 229 to 234, 236 to 240 and 242 of
the Canada Business Corporations Act apply, with such modifications as the
circumstances require, in respect of that company or corporation.
(2) Interpretation — In construing the sections of the Canada Business Cor-
porations Act made applicable to a company or corporation under this section,
in the case of a company, or corporation, incorporated without share capital,
“security holder”, or “registered holder or beneficial owner” in relation to a
security, means a member of the company or corporation.
(3) Powers of Directors — A Director or Deputy Director appointed under
section 260 of the Canada Business Corporations Act may, for the purpose of
434
Part IV — Transitional and Coming Into Force (ss. 60–62) S. 62
giving effect to this section with respect to the application of sections 229 to
234, 236 to 240 and 242 of that Act, exercise the powers and perform the func-
tions and duties of the Director under those sections.
PART IV — TRANSITIONAL AND COMING INTO FORCE

(SS. 60–62)
60. (1) [Repealed SI/91-111.]
(2) Old law applicable — For the purposes of any inquiry or other matter
or proceeding referred to in subsection (1), the Combines Investigation Act and
any other Act of Parliament amended by this Act shall be read as if this Act
Tribunal Act
had not come into force.
(3) Members of the Commission may be appointed to Tribunal —
While the members continue in office in accordance with this section, they
may, if so appointed, hold office as members of the Competition Tribunal, but
any person who, pursuant to this subsection, holds more than one office is enti-
tled to be remunerated only in respect of one of those offices.
(4) Termination — The Governor in Council may, by proclamation, repeal
subsection (1) when the Governor in Council is satisfied that the Commission
no longer has any inquiry or other matter or proceeding referred to in subsec-
tion (1) before it and that the Commission has reported to the Minister of Con-
sumer and Corporate Affairs in respect of all inquiries before it.
SI/91-111
61. Orders of the Commission — For the purposes of the Competition

Act, as amended by this Act, an order of the Restrictive Trade Practices Com-
mission under Part V, as it read immediately prior to the coming into force of
section 29 of this Act, or pursuant to subsection 60(1) shall be deemed to be an
order of the Competition Tribunal under the Competition Act.
62. Coming into force — This Act or any provision thereof, or any provi-
sion of the Combines Investigation Act as amended or enacted by this Act, shall
come into force on a day or days to be fixed by proclamation.
435
CAN. REG. 2008-141 — COMPETITION TRIBUNAL
RULES
made under the Competition Tribunal Act
SOR/2008-141
PART 1 — GENERAL
Interpretation
1. Definitions — The following definitions apply in these Rules.
Tribunal
“Act” means the Competition Act. (“Loi”)
Rules
“applicant” means a person who files an application under Part VII.1 or Part
VIII of the Act or a person who files a reference under section 124.2 of the Act.
(“demandeur”)
“certified copy” of a document means a copy of the document certified by the
Registrar or a person designated by the Registrar. (“copie certifiée”)
“Chairperson” means the judicial member designated to be Chairman of the
Tribunal under subsection 4(1) of the Competition Tribunal Act. (“président”)
“Commissioner” means the Commissioner of Competition appointed under
subsection 7(1) of the Act. (“commissaire”)
“consent agreement” means an agreement made under section 74.12, 105 or
106.1 of the Act, the terms of which have been agreed on by the parties.
(“consentement”)
“counsel” means a member of the bar of a province. (“avocat”)
“document” includes pleadings, affidavits and any correspondence, memoran-
dum, book, plan, map, drawing, diagram, pictorial or graphic work, photo-
graph, film, microform, sound recording, videotape, machine readable record,
and any other documentary material, regardless of physical form or charac-
teristics, and any copy or portion of that material. (“document”)
“electronic hearing” means a hearing in which documents are provided in an
electronic form to the registry and are presented electronically in the course of
the hearing. (“audience électronique”)
“electronic transmission” includes transmission by electronic mail (e-mail) or
via the Tribunal website. (“transmission électronique”)
437
R. 1 fil Can. Reg. 2008-141 — Competition Tribunal Rules
“file” means to file with the Registrar. (“déposer”)

“intervenor” means
(a) a person granted leave to intervene by the Tribunal in accordance
with rule 46;
(b) an attorney general who intervenes under section 88 or 101 of the Act;
or
(c) the Commissioner who intervenes under section 103.2 or subsection
124.2(3) of the Act.
(“intervenant”)
“originating document” means either a notice of application, a notice of refer-
ence, or an application for leave under section 103.1 of the Act. (“acte in-
troductif d’instance”)
“paper hearing” means a hearing in which documents are provided in paper
form to the registry and are presented in paper form in the course of the hear-
ing. (“audience sur pièces”)
“party” means an applicant or a respondent. (“partie”)
“person” includes a corporation, a partnership and an unincorporated associ-
ation. (“personne”)
“reference” means the reference of a question to the Tribunal for determina-
tion under section 124.2 of the Act. (“renvoi”)
“Registrar” means the Registrar of the Tribunal. (“registraire”)
“registry” means the Registry of the Tribunal. (“greffe”)
“respondent” means a person who is named as a respondent in a notice of
application. (“défendeur”)
Rules Applicable to All Proceedings

Dispensing with Compliance
2. (1) Variation — The Tribunal may dispense with, vary or supplement the
application of any of these Rules in a particular case in order to deal with all
matters as informally and expeditiously as the circumstances and considera-
tions of fairness permit.
(2) Urgent matters — If a party considers that the circumstances require
that an application be heard urgently or within a specified period, the party
may request that the Tribunal give directions about how to proceed.
438
Part 1 — General R. 7(2)
Time Limits
3. Interpretation Act — Unless otherwise provided in these Rules, time lim-

its under these Rules or under an order of the Tribunal shall be calculated
under sections 26 to 30 of the Interpretation Act.
4. (1) Calculating time limits — If the time for doing an act expires on a
holiday or a Saturday, the act may be done on the next day that is not a holi-
day or a Saturday.
(2) Time limit less than six days — If a time limit is less than six days,
holidays and Saturdays shall not be included in the calculation of the time
limit.
5. Varying time limits — The time limits prescribed by these Rules may
only be shortened or extended by an order or a direction of a judicial member.
Tribunal
Documents
Rules
6. Memorandum of fact and law — Where in these Rules a reference is
made to a memorandum of fact and law, the memorandum of fact and law
shall contain a table of contents and, in consecutively numbered paragraphs,
(a) a concise statement of fact;
(b) a statement of the points in issue;
(c) a concise statement of the submissions;
(d) a concise statement of the order sought, including any order concern-
ing costs;
(e) a list of the authorities, statutes and regulations to be referred to; and
(f) an appendix, and if necessary as a separate document, a copy of the
authorities (or relevant excerpts) as well as a copy of any statutory or
regulatory provisions cited or relied on that have not been reproduced in
another party’s memorandum.
7. (1) Subpoena — The Registrar or the person designated by the Registrar

may issue a writ of subpoena for the attendance of witnesses and the produc-
tion of documents.
(2) In blank — The Registrar may issue a writ of subpoena in blank and the
person to whom it is issued shall complete it and may include any number of
names.
439
R. 8(1) Can. Reg. 2008-141 — Competition Tribunal Rules
Service of Documents
8. (1) Originating document — Service of an originating document shall

be effected
(a) in the case of an individual, by leaving a certified copy of the originat-
ing document with the individual;
(b) in the case of a partnership, by leaving a certified copy of the originat-
ing document with one of the partners during business hours;
(c) in the case of a corporation, by leaving a certified copy of the originat-
ing document with an officer of the corporation or with a person appar-
ently in charge of the head office or of a branch of the corporation in
Canada during business hours;
(d) in the case of the Commissioner, by leaving a certified copy of the
originating document at the Commissioner’s office during business hours;
and
(e) in the case of a person referred to in any of paragraphs (a) to (d) who
is represented by counsel, by leaving a certified copy of the originating
document with the counsel who accepts service of the document.
(2) Alternative manner — If a person is unable to serve an originating doc-
ument in a manner described in subrule (1), the person may apply to a judicial
member for an order setting out another manner for effecting service.
(3) Service of order — The person who obtains an order made under sub-
rule (2) shall serve the order on each person named in the originating
document.
9. Deemed served — If a document has been served in a manner not au-

thorized by these Rules or by an order of the Tribunal, the Tribunal may, on
motion, order that a document be deemed validly served if it is satisfied that
the document came to the notice of the person to be served or that it would
have come to that person’s notice except for the person’s avoidance of service.
10. (1) Other documents — Service of a document, other than an originat-

ing document, on a person who is not represented by counsel shall be effected
(a) in a manner set out in any of paragraphs 8(1)(a) to (d), except that the
copy of the document need not be certified;
(b) by leaving a copy of the document at the usual or last known address
of the person;
(c) by sending a copy of the document to the person by facsimile transmis-
sion in accordance with subrule (3);
(d) by sending a copy of the document to the person by registered mail or
by messenger or courier service, and by obtaining an acknowledgement of
440
Part 1 — General R. 10(4)(e)
receipt signed and dated by the person or by someone on behalf of the

person;
(e) by electronic transmission of the document to the person, if the person
agrees and, within 24 hours, sends an acknowledgement of receipt; or
(f) in any other manner that the Tribunal may order.
(2) Person represented — Service of a document, other than an originat-
ing document, on a person who is represented by counsel shall be effected
(a) in the manner set out in paragraph 8(1)(e), except that the copy of the
document need not be certified;
(b) by leaving a copy of the document at the counsel’s business address;
(c) by sending a copy of the document to the counsel by facsimile trans-
mission in accordance with subrule (3);
(d) by sending a copy of the document to the counsel by registered mail
and by obtaining an acknowledgement of receipt signed and dated by the
counsel or by someone on behalf of the counsel;
Tribunal
(e) by electronic transmission to the counsel, who shall within 24 hours
Rules
send an acknowledgement of receipt; or
(f) in any other manner that the Tribunal may order.
(3) Service by fax — A document that is served by facsimile transmission
shall include a cover page setting out
(a) the name, address and telephone number of the sender;
(b) the name of the person or the counsel to whom a copy of the document
is sent;
(c) the date and time of the transmission;
(d) the total number of pages transmitted, including the cover page; and
(e) the name and telephone number of the person to contact if transmis-
sion problems occur.
(4) Service by electronic transmission — A document that is served by
electronic transmission shall be accompanied by an electronic message setting
out
(a) the name, address, telephone number and e-mail address of the
sender;
(b) the name of the person or the counsel to whom the document is sent;
(c) the date and time of the transmission;
(d) the title of the document transmitted; and
(e) the name, telephone number and e-mail address of the person to con-
tact if transmission problems occur.
441
11. (1) Proof of service — Proof of service shall be made by an affidavit of

service in accordance with the form set out in Schedule 1, for an originating
document, or Schedule 2, for a document other than an originating document.
(2) By certificate — Proof of service of a document other than an originat-
ing document can be made by a certificate by a counsel or the person desig-
nated by the counsel in accordance with the form set out in Schedule 3.
(3) Service by mail — In the case of service by registered mail, a signed and
dated acknowledgement of receipt shall be attached to the affidavit of service
or the counsel’s certificate, as the case may be.
Filing of Documents
12. (1) Electronic filing — The parties shall file their documents by elec-
tronic transmission.
(2) Alternative — The Tribunal may, if it considers that it is justified in the
circumstances, allow paper filing and facsimile filing.
(3) Original document — Documents filed by electronic transmission shall
constitute the original for both electronic and paper hearings.
(4) Paper copies — Parties to paper hearings shall provide to the registry
five paper copies of the documents filed by electronic transmission within 24
hours after that filing.
13. Filing by intervenor — An intervenor shall use the same medium (elec-
tronic or paper) as the parties.
14. (1) Paper filing — Subject to subrule (2), only those documents that are
printed on 21.5 cm x 28 cm (letter size) paper and that have numbered pages
may be filed.
(2) Non-standard format — A document that is not printed on 21.5 cm x
28 cm paper and that cannot reasonably be converted to that format by the
person filing it may be filed in its existing format.
15. (1) Facsimile filing — If a document is filed by facsimile transmission, it

is deemed to be the original.
(2) Filing by facsimile not allowed — The following documents shall not
be filed by facsimile transmission:
(a) an originating document and any documents accompanying it;
(b) a document that is filed in multiple copies; and
(c) a document that contains, to which is appended or that is accompanied
by a document containing confidential information.
442
Part 1 — General R. 21
16. Cover page — A document filed by facsimile transmission shall include

a cover page that satisfies the requirements of subrule 10(3).
17. Filing after 17:00 hours — A document filed by facsimile transmission

after 17:00 hours Ottawa local time is deemed to be filed on the next day that
is not a holiday or Saturday.
18. (1) Format for electronic filing — An electronic version of a docu-

ment in PDF (Portable Document Format) or any other format allowed by the
Tribunal shall be filed in a manner directed by the Registrar.
(2) Filed electronically — All documents filed by electronic transmission
shall be electronically time stamped.
(3) Filed after 17:00 hours — Any document transmitted electronically af-
ter 17:00 hours Ottawa local time is deemed to be filed on the next day that is
not a holiday or Saturday.
Tribunal
Rules
19. Irregularity or defect — At any time before judgment is given in a pro-
ceeding, the Tribunal may draw the attention of a party to any irregularity or
defect relating to an electronic version of a document and permit the party to
remedy it on any conditions that the Tribunal considers fair.
20. (1) Electronic sworn statement or solemn affirmation — A state-

ment made under oath or solemn affirmation may be filed electronically, by
filing a scanned version of the document that includes a handwritten signature
and the following: “The document that is being electronically submitted to the
Tribunal is an electronic version of a paper document that has been signed by the
affiant. The signed document in paper copy is available and will be produced if
requested by the Tribunal.”
(2) Maintenance of document — The document referred to in subrule (1)
must be maintained in paper form by the party or intervenor filing the docu-
ment until one year after all periods for appeals expire.
(3) Provision of original — Upon request of the Tribunal, the party or in-
tervenor filing the statement made under oath or solemn affirmation must
provide the original signed document for review.
(4) Alternative means for filing — Upon the request of a party or inter-
venor, the Tribunal may order a different method for the electronic filing of a
statement made under oath or a solemn affirmation, or may order other
means for filing the document.
21. Electronic certified copy — If a document is filed electronically, and a

certified copy of the document is requested from the Tribunal, the Tribunal
may provide an electronic copy of the document stamped “certified”.
443
R. 22 Can. Reg. 2008-141 — Competition Tribunal Rules
22. Public access — Subject to any confidentiality order under rule 66, the
public is entitled to access the documents filed or received in evidence on the
public record, in the format in which they were received by the registry.
23. Without confidentiality order — A party or intervenor who wishes to

assert confidentiality in a document to be filed that is not covered by a confi-
dentiality order shall
(a) file a public version of the document that does not include the confi-
dential information;
(b) provide the registry with a version of the document marked “confi-
dential” that includes and identifies the confidential information that has
been deleted from the public version filed under paragraph (a); and
(c) bring a motion under rule 66 for an order allowing it to file the confi-
dential version.
24. With confidentiality order — A party or intervenor who wishes to file

a document containing information that has already been made subject to a
confidentiality order under rule 66 shall file a public version that does not
include the confidential information and a confidential version with each page
clearly marked “confidential”. The confidential version shall identify the con-
fidential material that has been deleted from the public version and the date of
the relevant confidentiality order.
Publication of Notice
25. (1) Notice — The Registrar shall, as soon as the notice of application
under Part VIII of the Act has been filed, publish a notice
(a) in the Canada Gazette; and
(b) over a period of two weeks, in at least two issues of at least two daily
newspapers designated by the Chairperson or a judicial member desig-
nated by the Chairperson.
(2) Content — The notice referred to in subrule (1) shall state
(a) that an application for an order has been made to the Tribunal;
(b) the name of each person against whom or in respect of whom the or-
der is sought;
(c) the particulars of the order sought;
(d) that the notice of application and accompanying documents may be
examined at the office of the Registrar; and
(e) the date on or before which a motion for leave to intervene must be
filed.
444
Part 1 — General R. 31
Discontinuance or Withdrawal
26. (1) Discontinuance — An applicant may discontinue all or part of an

application at any time before a final determination of the application by the
Tribunal.
(2) Notice of discontinuance — The applicant shall serve a notice of dis-
continuance on each party and on each intervenor and file the notice with
proof of service.
27. (1) Withdrawal — A respondent who has filed a response may withdraw
all or part of the response at any time before a final determination of the ap-
plication by the Tribunal.
(2) Notice of withdrawal — The respondent shall serve a notice of with-
drawal on each party and on any intervenor and file the notice with proof of
service.
Tribunal
28. Costs — If a party withdraws from or discontinues the proceedings, the
Rules
Tribunal may award costs in accordance with section 8.1 of the Competition
Tribunal Act.
Hearings
29. Hearings open to the public — Subject to rule 30, hearings shall be
open to the public.
30. (1) In-camera hearings — A party, an intervenor or a person inter-

ested in the proceedings may request that all or a portion of a hearing not be
open to the public.
(2) Content of request — A person who makes the request shall advise the
Tribunal of the reasons for the request, including details of the specific, direct
harm that would allegedly result from conducting the hearing or a portion of
the hearing in public.
(3) Power of the Tribunal — The Tribunal may, if it is of the opinion that
there are valid reasons for a hearing not to be open to the public, make any
order that it deems appropriate.
Practice and Procedure
31. Composition of the Tribunal — Subject to sections 10 and 11 of the

Competition Tribunal Act and for the purposes of these Rules, the Tribunal
shall consist of one or more members designated by the Chairperson, at least
one of whom is a judicial member.
445
32. Case record in electronic format — The original and official case
record of an electronic hearing shall be kept by the Tribunal only in electronic
format.
33. (1) Practice directions — The Tribunal may issue practice directions.
(2) Technology — The Tribunal may give directions requiring the use of
any electronic or digital means of communication, storage or retrieval of infor-
mation, or any other technology it considers appropriate to facilitate the con-
duct of a hearing or case management conference.
34. (1) Questions as to practice or procedure — If, in the course of

proceedings, a question arises as to the practice or procedure to be followed in
cases not provided for by these Rules, the practice and procedure set out in the
Federal Courts Rules may be followed.
(2) Tribunal may direct — If a person is uncertain as to the practice or
procedure to be followed, the Tribunal may give directions about how to
proceed.
Case Law
(Competition Trib.) — In an application under the deceptive marketing practices provisions
of the Act, the Commissioner served a document in the form of a request to admit pursuant
to rules 255 and 256 of the Federal Court Rules. During the hearing of the application, the
respondent moved for an order directing that the request to admit was not valid. The Com-
missioner submitted that the request to admit was valid by operation of rule 72 of the Com-
petition Tribunal Rules [now rule 347], which provided that where a question arose as to the
practice or procedure to be followed in cases not provided for by the Rules, the practice and
procedure set out in the Federal Court Rules should be followed. The Tribunal found that the
request to admit was valid, but ordered that the time to respond be extended as it was reason-
able for the respondent to raise the issue of its validity. Rule 21 of the Competition Tribunal
Rules, which allowed the Tribunal to consider at a pre-hearing conference “the possibility of
obtaining admissions of particular facts or documents” was not so all-inclusive on the issue
of admissions that it could be said to provide a comprehensive practice or procedure with
respect to obtaining admissions. Rules 255 and 256 of the Federal Court Rules provided for
a procedure did not require the intervention of a judicial officer. The procedure in serving a
request to admit was a separate and distinct practice or procedure from reviewing at a pre-
hearing conference the possibility of serving admissions.
8(2), 9(2), and 10(2) of the Competition Tribunal Act, and rule 39 of the Federal Court
Rules, the Tribunal held that it was appropriate to order the termination of the hearing before
446
Part 2 — Contested Proceedings R. 38(1)(b)
the seized Tribunal panel, and to appoint a new panel. The Tribunal further concluded that it
would not amend the questions and issues referred to the Tribunal as part of the preliminary
questions prior to the adjournment. The Tribunal did order Air Canada to produce certain
information requested by the Commissioner, which extended beyond the time period covered
at the hearing of the preliminary questions. Air Canada had obtained the adjournment on the
basis that intervening events had changed matters relevant to the issue of avoidable costs,
and it required more time to assess the effects of such change.
PART 2 — CONTESTED PROCEEDINGS

Application
35. Application of Part — This Part applies to all applications to the Tribu-
nal, except applications for interim or temporary orders (Part 4), applications
for specialization agreements (Part 5), applications for leave under section
103.1 of the Act (Part 8) and applications for a loan order (Part 9).
Tribunal
36. (1) Notice of application — An application shall be made by filing a
Rules
notice of application.
(2) Form and content — A notice of application shall be signed by or on
behalf of the applicant and shall set out, in numbered paragraphs,
(a) the sections of the Act under which the application is made;
(b) the name and address of each person against whom an order is
sought;
(c) a concise statement of the grounds for the application and of the mate-
rial facts on which the applicant relies;
(d) a concise statement of the economic theory of the case, if any, except in
the case of an application made under Part VII.1 of the Act;
(e) the particulars of the order sought; and
(f) the official language that the applicant intends to use in the
proceedings.
37. (1) Service of notice — The applicant shall, within five days after a
notice of application is filed, serve the notice on each respondent.
(2) Proof of service — The applicant shall, within five days after the ser-
vice of the notice of application, file proof of service.
38. (1) Response — A respondent who wishes to oppose the application

shall, within 45 days after being served with the notice of application,
(a) serve a response on the applicant and on any other respondent; and
(b) file the response with proof of service.
447
(2) Form and content — The response shall set out, in numbered
paragraphs,
(a) a concise statement of the grounds on which the application is opposed
and of the material facts on which the person opposing the application
relies;
(b) an admission or denial of each ground and of each material fact rele-
vant to each ground set out in the notice of application;
(c) a concise statement of the economic theory of the case, if any, except in
the case of an application made under Part VII.1 of the Act; and
(d) the official language that the person opposing the application intends
to use in the proceedings.
Case Law
(Competition Trib.) — The Commissioner alleged that the respondent employed deceptive
marketing practices, and filed two affidavits supporting the application. The Commissioner
claimed public interest privilege over, and did not disclose, two exhibits on which the Com-
missioner did not intend to rely at the hearing. The respondent sought an order granting leave
to amend its responding statement of grounds and material facts, and an order directing the
Commissioner to produce certain exhibits to the two affidavits. The motion for leave to
amend the response was dismissed. Although the proposed amendments reduced the length
of the respondent’s response by some 70 pages, as the legal and factual issues remained the
same, the proposed pleading did not assist in determining the real questions in controversy.
To the extent the pleading no longer contained admissions of a factual nature, the effect of
the proposed amendment would have been to lengthen the duration of the hearing as the
Commissioner would have had to lead evidence on those matters. In regard to the claim of
public interest privilege over the exhibits, the rationale for the privilege was absent once the
investigation was completed, and the identity of the informants was disclosed. As the depo-
nents of the affidavits were to testify at the hearing, and questions as to the information in
the exhibits could be put to them on cross-examination, prior release of this information
would promote an expeditious and fair hearing.
39. (1) Reply — The applicant may, within 14 days after being served with a
response in accordance with subrule 38(1), serve a reply on the respondent
and on each other party and shall file the reply with proof of service.
(2) Content — A reply shall set out an admission or denial of each ground
and of each material fact relevant to each ground set out in the response.
(3) Failure to file — If the applicant does not file a reply, the applicant is
deemed to have denied each ground and each material fact relevant to each
ground set out in the response.
40. (1) Timetable for disposition of application — Each party shall,

within 14 days after the expiry of the period for filing a response, consult with
the other parties and, if a timetable is agreed, file the proposed timetable for
448
Part 2 — Contested Proceedings R. 43(2)(e)
the disposition of the application, including a suggested start date, duration

and place for the hearing.
(2) Timetable not agreed — If the parties cannot agree on a timetable,
each party shall serve on the other parties a proposed timetable and file it with
proof of service within the period set out in subrule (1).
41. (1) Order in default of response — If a person has not filed a re-
sponse within the period set out in subrule 38(1), the applicant may move that
the Tribunal issue the order sought in the notice of application against the
person.
(2) Decision — On a motion in accordance with subrule (1), the Tribunal
shall, if it is satisfied that the notice of application was served in accordance
with these Rules and it has heard any evidence that it may require, make any
order that it deems appropriate.
(3) Service — The Registrar shall, as soon as an order is made, serve the
order on the respondent and on each other party.
Tribunal
Rules
Intervention
42. Motion for leave to intervene — A motion under subsection 9(3) of
the Competition Tribunal Act for leave to intervene shall be filed within 10 days
after the end of the period for filing a response.
43. (1) Service and filing motion — A motion for leave to intervene shall
be made by
(a) serving on each of the parties a motion for leave to intervene and an
affidavit setting out the facts on which the motion is based; and
(b) filing the motion and the affidavit with proof of service.
(2) Content — A motion for leave to intervene shall set out
(a) the title of the proceedings in which the person making the motion
wishes to intervene;
(b) the name and address of that person;
(c) a concise statement of the matters in issue that affect that person and
the unique or distinct perspective that the person will bring to the
proceeding;
(d) a concise statement of the competitive consequences arising from the
matters referred to in paragraph (c) with respect to which that person
wishes to make representations;
(e) the name of the party, if any, whose position that person intends to
support;
449
R. 43(2)(f) Can. Reg. 2008-141 — Competition Tribunal Rules
(f) the official language to be used by that person at the hearing of the
motion and, if leave is granted, in the proceedings; and
(g) a description of how that person proposes to participate in the
proceedings.
(3) Disposition without hearing — A person filing a motion for leave to
intervene may request in writing that the Tribunal dispose of the motion with-
out a hearing.
44. (1) Response — A party served with a motion for leave to intervene
may, within 14 days after that service, serve a response to the motion on the
person making the motion and on each of the parties and shall file any re-
sponse to the motion with proof of service.
(2) Content — A response to a motion for leave to intervene shall
(a) deal with the matters raised in the motion; and
(b) state whether the party filing the response considers that a hearing
should be held to determine the motion.
45. Reply — A person making a motion for leave to intervene may, within
seven days after the service of the response referred to in rule 44, serve a reply
on each of the parties and shall file the reply with proof of service.
46. (1) Disposition — If the Tribunal is of the opinion that a hearing should
be held to determine a motion for leave to intervene, the motion shall be dis-
posed of at a time and in a manner determined by the Tribunal.
(2) Determination by Tribunal — The Tribunal may allow a motion for
leave to intervene, with or without conditions, or refuse the motion.
47. Intervention allowed — If a motion for leave to intervene is allowed

(a) the Registrar shall send to the intervenor a list of all documents filed
in the proceedings before or on the day on which the motion for leave to
intervene was allowed;
(b) on request, the intervenor may obtain copies of the documents on the
list from the Registrar;
(c) each party and each other intervenor shall serve on the intervenor any
document that is filed by them after the day on which the motion for leave
to intervene was allowed; and
(d) access by an intervenor to a document filed or received in evidence is
subject to any relevant confidentiality order of the Tribunal.
48. Service of documents — Any document to be filed by an intervenor

shall be served on each party and each other intervenor and shall be filed with
proof of service.
450
Part 2 — Contested Proceedings R. 51(d)
49. (1) Intervention by attorney general of a province — If a notice of

application relating to an application under section 86, 87 or 92 of the Act is
filed, the Registrar shall serve the notice on the attorney general of each
province.
(2) Date for filing notice — The Registrar shall inform the attorney gen-
eral of each province of the date on or before which any notice of intervention
under rule 50 must be filed.
50. (1) Notice of intervention — The attorney general of a province who

decides to intervene in any proceedings before the Tribunal under section 86,
87 or 92 of the Act shall
(a) serve a notice of intervention on each party; and
(b) file the notice with proof of service within 10 days after the expiry of
the period for filing a response.
(2) Content — A notice of intervention shall set out
Tribunal
(a) the title of the proceedings in which the attorney general is
Rules
intervening;
(b) a concise statement of the nature of the interest of the attorney general
in the proceedings;
(c) a concise statement of the matters in respect of which the attorney
general will make representations on behalf of the province;
(d) the name of the party, if any, whose position the attorney general in-
tends to support; and
(e) the official language that the attorney general intends to use in the
proceedings.
(3) Service — The Registrar shall serve the notice of intervention on each
other intervenor as soon as it is filed.
51. List of documents — If a notice of intervention is filed

(a) the Registrar shall send to the attorney general a list of all documents
filed in the proceedings before or on the day on which the notice of inter-
vention was filed;
(b) on request, the attorney general may obtain copies of the documents
on the list from the Registrar;
(c) each party and each other intervenor shall serve on the attorney gen-
eral any document filed by them after the day on which the notice of in-
tervention was filed; and
(d) access by the attorney general to a document filed or received in evi-
dence is subject to any relevant confidentiality order of the Tribunal.
451
52. (1) Participation of an attorney general — Subject to subsection

57(4) of the Federal Courts Act, the participation of an attorney general who
has filed a notice of intervention is restricted to attending and making submis-
sions at motions, case management conferences and the hearing of the
application.
(2) Motion for leave to participate — The attorney general may at any
time serve and file with proof of service a motion for leave to participate in the
proceedings in a manner other than that set out in subrule (1).
53. Service of documents — Any document to be filed by an attorney

general shall be served on each party and any other intervenor and shall be
filed with proof of service.
54. (1) Intervention by the Commissioner — If the Commissioner inter-

venes in a proceeding under section 103.2 or subsection 124.2(3) of the Act, the
Commissioner shall file a notice of intervention that sets out
(a) the title of the proceedings in which the Commissioner is intervening;
and
(b) a concise statement of the matters on which the Commissioner wishes
to make representations.
(2) Service — The Registrar shall serve the notice of intervention on each
party as soon as it is filed.
55. Commissioner’s access to documents — If a notice of interven-

tion is filed by the Commissioner,
(a) the Registrar shall, within five days after the filing of the notice, send
to the Commissioner a list of all documents filed in the proceedings before
or on the day on which the notice of intervention was filed;
(b) on request, the Commissioner may obtain copies of any of the docu-
ments on the list from the Registrar;
(c) each party shall serve on the Commissioner any document that is filed
by them after the day on which the notice of intervention is filed; and
(d) access by the Commissioner to a document filed or received in evi-
dence is subject to any relevant confidentiality order of the Tribunal.
Admissions
56. Requests for admissions — A party may, after pleadings have been
closed but not later than 25 days before the commencement of the hearing,
request that another party admit a fact or the authenticity of a document by
serving a request to admit, in form 255 of the Federal Courts Rules, on that
party, with any modifications that the circumstances require.
452
Part 2 — Contested Proceedings R. 60
57. (1) Deemed admissions — A party who is served with a request to

admit is deemed to admit the truth of a fact or the authenticity of a document
set out in the request to admit unless that party serves a response to the re-
quest in form 256 of the Federal Courts Rules within 20 days after service of
the request and denies the admission, setting out the grounds for the denial,
with any modifications that the circumstances require.
(2) Admissions for purposes of the proceedings — A party is
deemed, for the purposes of the proceeding only, to admit the truth of the facts
or the authenticity of the documents mentioned in the request, unless the
party’s response
(a) specifically denies the truth of a fact or the authenticity of a document
mentioned in the request; or
(b) refuses to admit the truth of a fact or the authenticity of a document
and sets out the reason for the refusal.
58. Costs — If a party denies or refuses to admit the truth of a fact or the
Tribunal
authenticity of a document after receiving a request to admit, and the fact or
Rules
authenticity of the document is subsequently proved at the hearing, the Tribu-
nal may take the denial or refusal into account in exercising its discretion re-
specting costs.
59. Withdrawal of admission — An admission made in response to a re-

quest to admit, a deemed admission under rule 57 or an admission in a plead-
ing may be withdrawn on consent of the other party or with leave of the
Tribunal.
Discovery
60. (1) Affidavit of documents — The applicant and each respondent who
has filed a response shall, within the time prescribed at a case management
conference, serve an affidavit of documents on each other party.
(2) Content — An affidavit of documents shall include
(a) a list identifying the documents that are relevant to any matter in issue
and that are or were in the possession, power or control of the party;
(b) any claim that a document is confidential or contains confidential
information;
(c) any claim that a document is privileged; and
(d) a statement of the grounds for each claim of privilege.
Case Law
Canada (Commissioner of Competition) v. Superior Propane Inc. (August 24, 1999) (Comp.
Trib., Nadon J.) — In an application under s. 92, the respondents brought a motion for an
order compelling the Commissioner to produce all relevant documents provided to the Com-
453
missioner by his witnesses and to produce to the respondents all relevant information either
through the production of interview notes or, by including in the previously ordered witness
affidavits, all facts relating to each witness. The Tribunal dismissed the motion as the Com-
missioner was entitled to rely on the litigation privilege. Furthermore, the Tribunal inter-
preted the motion as an attempt to reopen the discovery process, and it was too late to do so.
Softkey Software Products Inc., Re (1994), 84 F.T.R. 153, (sub nom. Canada (Director of
Investigation & Research) v. Softkey Software Products Inc.) 57 C.P.R. (3d) 480 (T.D.) —
An ex parte order for disclosure of documents pursuant to a Commissioner’s investigation
under the Act can only be rescinded where there are special or unique circumstances. These
circumstances might include evidence that it was made on the basis of misleading, incom-
plete or incorrect facts. A reviewing judge cannot substitute his or her discretion for that of
the authorizing judge. Where there was no indication that there were pertinent facts or infor-
mation that had not been before the authorizing judge, an application to set aside an ex parte
order for the production of documents and written returns was dismissed.
(Competition Trib.) — All relevant documents must be indicated in the affidavit of docu-
ments even if privilege is claimed on them.
(Competition Trib.) — There is no reason why the Commissioner should not be made sub-
ject to a confidentiality order made with respect to documents obtained on discovery.
61. Power of the Tribunal — Upon the motion of a party who has served
an affidavit of documents and who opposes a claim for privilege of another
party, the Tribunal may inspect the document and determine the validity of
the claim.
62. (1) Application of deemed undertaking — This rule applies to evi-

dence obtained during documentary, written and oral discovery and informa-
tion obtained from that evidence.
(2) Deemed undertaking — All parties and their counsel are deemed to
undertake not to use evidence or information to which this rule applies for any
purposes other than those of the proceeding in which the evidence was
obtained.
(3) Exceptions — Subrule (2) does not prohibit
(a) a use to which the person who disclosed the evidence consents;
(b) the use, for any purpose, of
(i) evidence that is filed with the Tribunal,
(ii) evidence that is given or referred to during a hearing; or
(iii) information obtained from evidence referred to in subparagraph
(i) or (ii),
(c) the use of evidence obtained in one proceeding, or information ob-
tained from such evidence, to impeach the testimony of a witness in an-
other proceeding, or
454
Part 2 — Contested Proceedings R. 66(2)
(d) the use of evidence or information in a subsequent Tribunal

proceeding.
(4) Non-application — If satisfied that the interest of justice outweighs any
prejudice that would result to a party who disclosed evidence, the Tribunal
may, on motion, order that the deemed undertaking referred to in subrule (2)
does not apply to the evidence or to information obtained from it, and may
impose any terms and give any directions that are just.
63. Supplementary affidavit — A party who has served an affidavit of

documents and who comes into possession or control of or obtains power over
a relevant document, or who becomes aware that the affidavit of documents is
inaccurate or deficient, shall as soon as possible serve a supplementary affida-
vit of documents listing the document or correcting the inaccuracy or
deficiency.
64. (1) Examination for discovery — Examination for discovery shall oc-
cur as of right.
Tribunal
Rules
(2) Power of the Tribunal — The Tribunal may, in case management,
make rulings to deal with the timing, duration, scope and form of the discov-
ery as well as the appropriate person to be discovered.
Access to Documents
65. Access to documents — Subject to any confidentiality order under
rule 66, a party who has served an affidavit of documents on another party
shall allow the other party to inspect and make copies of the documents listed
in the affidavit, unless those documents are subject to a claim for privilege or
are not within the party’s possession, power or control.
66. (1) Confidentiality order — The Tribunal may order that a document
or information in a document be treated as confidential and make any order
that it deems appropriate,
(a) upon the motion of a party who has served an affidavit of documents;
or
(b) upon the motion of a party or intervenor who has filed or will file the
document.
(2) Clarification — For greater certainty, the Tribunal may issue a single
confidentiality order to cover the documents or information under paragraphs
(1)(a) and (b).
455
67. Content of motion — The party or intervenor making a motion re-

ferred to in rule 66 shall
(a) include in the grounds for the motion details of the specific, direct
harm that would allegedly result from unrestricted disclosure of the docu-
ment or information; and
(b) include in the motion a draft confidentiality order including the fol-
lowing elements, namely,
(i) a description of the document or information or the category of
documents or information for which the person seeks the confidenti-
ality order,
(ii) the identification of the person or category of persons who are
entitled to have access to the confidential document or information,
(iii) any document or information or category of documents or infor-
mation to be made available to the person or category of persons re-
ferred to in subparagraph (ii),
(iv) any written confidentiality agreement to be signed by the person
or persons referred to in subparagraph (ii) and the provisions of that
agreement,
(v) the number of copies of any confidential document to be provided
to the person or persons referred to in subparagraph (ii) and any
limitation on subsequent reproduction of that document by that per-
son or those persons, and
(vi) the disposal of the confidential document following the final dis-
position of the proceeding.
Pre-hearing Disclosure
68. (1) List of documents and witness statements — The applicant
shall, at least 60 days before the commencement of the hearing, serve on every
other party and on all intervenors
(a) a list of documents on which the applicant intends to rely at the hear-
ing, noting any waivers of privilege claimed in regard to those documents;
and
(b) witness statements setting out the lay witnesses’ evidence in chief in
full.
(2) Content of witness statements — Unless the parties otherwise agree,
the witness statements shall include only fact evidence that could be given
orally by the witness together with admissible documents as attachments or
references to those documents.
456
Part 2 — Contested Proceedings R. 73
69. (1) Response — Each respondent shall, at least 30 days before the com-
mencement of the hearing, serve in response on every other party and on all
intervenors
(a) a list of documents on which the respondent intends to rely at the
hearing, noting any waivers of privilege claimed in regard to those docu-
ments; and
(b) witness statements setting out the lay witnesses’ evidence in chief in
full.
(2) Content of witness statements — Unless the parties otherwise agree,
the witness statements shall include only fact evidence that could be given
orally by the witness together with admissible documents as attachments or
references to those documents.
70. Reply — The applicant may, at least 15 days before the commencement of
the hearing, serve in reply on every other party and on all intervenors
(a) any additional reply documents on which the applicant intends to rely
Tribunal
at the hearing as a result of the respondent’s disclosure, and any waiver
Rules
of privilege; and
(b) any new reply witness statements or additions to existing witness state-
ments to deal with any issues raised in the reply.
Case Law
Commissioner of Competition v. Air Canada, 2012 Comp. Trib. 20 (Competition Trib.) —
The Commissioner brought a motion for an order compelling the Respondents to answer
outstanding questions taken under advisement during examinations for discovery. The Tribu-
nal held that the requirement under the Rules for comprehensive and continuous pre-hearing
disclosure does not extend to the disclosure of an expert’s work in progress unless that privi-
lege is waived.
Evidence at the Hearing

71. Sanctions — If a document has not been disclosed in the affidavit of doc-
uments and in the pre-hearing disclosure, or if privilege has not been waived
for such a document, it shall not be received in evidence at the hearing unless
the Tribunal orders otherwise.
72. Records to be admitted in evidence — The Commissioner shall

provide a list of the documents to be admitted in evidence without further
proof in accordance with section 69 of the Act at least 45 days before the com-
mencement of the hearing.
73. Information under par. 11(1)(a) of the Act — The Commissioner

may move for authorization from the Tribunal to read into evidence informa-
tion obtained under paragraph 11(1)(a) of the Act.
457
74. (1) Evidence in chief — The evidence in chief of each lay witness shall
be tendered by way of the statement referred to in rules 68 to 70 and consist of
their full statement of evidence and relevant documents or references to those
documents.
(2) Witness statements — Witness statements of lay witnesses shall be
provided to the registry with proof of service at least 10 days before the com-
(3) Tribunal may read — The Tribunal may read the material provided,
unless a party makes a valid objection.
(4) Witness must attend — A witness statement may be received in evi-
dence at the hearing only if the witness is in attendance and available for
cross-examination or questioning by the Tribunal.
(5) Evidence in chief — The lay witness may be examined in chief for the
purpose of summarizing or highlighting the evidence contained in the
statement.
Witness Panels
75. Witness panels — The Tribunal may require that some or all of the
witnesses testify as a panel at any time that the Tribunal may determine.
76. (1) Manner of testimony — The Tribunal shall direct the manner in
which the panel shall testify.
(2) Cross-examination and re-examination — Counsel may cross-ex-
amine or re-examine witnesses.
Expert Evidence
77. (1) Expert report — At least 60 days before the commencement of the
hearing, an applicant who intends to introduce evidence of an expert witness
at the hearing shall serve the report of the expert witness on each other party
and any intervenors.
(2) Responding report — At least 30 days before the commencement of the
hearing, a respondent may serve a responding expert report on each other
party and any intervenors.
(3) Reply report — The applicant may, at least 15 days before the com-
mencement of the hearing, serve an expert reply report on each other party
and any intervenors.
(4) Content of report — A report referred to in any of subrules (1) to (3)
shall include a full statement of the evidence of the expert witness, the expert’s
458
Part 2 — Contested Proceedings R. 80(4)(b)
qualifications as an expert and a list of the sources and documents relied upon
in the report.
Case Law
(Competition Trib.); additional reasons at (1993), 48 C.P.R. (3d) 224 (Competition Trib.);
reversed in part [1995] 3 F.C. 557, 21 B.L.R. (2d) 1, 63 C.P.R. (3d) 1, 127 D.L.R. (4th) 263,
(sub nom. Director of Investigation & Research, Competition Act v. Southam Inc. (No. 1))
185 N.R. 321 (C.A.); leave to appeal to S.C.C. granted (1996), 64 C.P.R. (3d) vi (note), 130
D.L.R. (4th) vi (note) (S.C.C.); reversed Canada (Director of Investigation & Research) v.
Southam Inc. (1997), 50 Admin. L.R. (2d) 199, 144 D.L.R. (4th) 1, [1996] S.C.J. No. 116,
71 C.P.R. (3d) 417, [1997] 1 S.C.R. 748, 209 N.R. 20, 1997 CarswellNat 368, 1997 Car-
swellNat 369 (S.C.C.) — The rules respecting affidavits set out in rule 47 [now rule 77] are
mandatory. Thus, in order for the affidavit of a witness to form part of the record and be
considered as evidence, that expert witness must be made available for cross-examination on
that affidavit. The mere fact that another witness makes reference to the affidavit does not
make it part of the evidence presented to the Tribunal.
Tribunal
78. (1) Expert report provided to the registry — Unless otherwise or-
Rules
dered during case management, a report referred to in rule 77 shall be pro-
vided to the registry with proof of service at least 10 days before the com-
(2) Tribunal may read — The Tribunal may read the report provided, un-
less a party makes a valid objection.
(3) Record — The report shall not form part of the record until it is received
in evidence at the hearing.
79. Examination of expert witness — A report referred to in rule 77

shall not be read aloud at the hearing but the expert witness may be examined
in chief for the purpose of summarizing or highlighting the evidence contained
in the report and may be cross-examined and re-examined.
80. (1) Tribunal-appointed expert — The Tribunal may, at any time, by

order appoint one or more independent experts to inquire into and report on
any question of fact or opinion relevant to an issue in a proceeding.
(2) Agreed upon expert — The parties may jointly recommend an expert
to the Tribunal.
(3) Submissions — The parties may make submissions about the terms of
the order.
(4) Content of order — The order shall contain the following information:
(a) the name of the expert being appointed and the expert’s qualifications;
(b) the instructions given to the expert with respect to the preparation of
the report;
459
R. 80(4)(c) Can. Reg. 2008-141 — Competition Tribunal Rules
(c) the questions to be posed to the expert;

(d) the date on which the report of the expert is to be provided to the
Tribunal;
(e) the nature and extent of the expert’s participation in the proceeding;
and
(f) the remuneration to be paid to the expert.
(5) Service of report — The Registrar shall serve a copy of the report on
every party and any intervenor.
(6) Case record — The report shall be made part of the case record.
(7) Response — Any party may file a written response to the expert’s re-
port and may examine the expert. The order and nature of such examinations
shall be determined by the Tribunal.
(8) Further or supplementary report — The Tribunal may order the ex-
pert to make a further or supplementary report, and subrules (4) to (7) apply
to that report.
(9) Liability for payment — The liability for payment of the remuneration
of the expert shall be determined by the Tribunal at any time after the conclu-
sion of the hearing following receipt of submissions on that issue.
PART 3 — MOTIONS
Informal Procedure
81. (1) Informal procedure — Except in the case of a motion for summary
disposition, if these Rules provide that relief shall be sought by way of motion,
a party may begin by informally requesting relief by sending a letter to the
registry and serving the letter on the other parties and on any intervenor, who
shall respond promptly.
(2) Tribunal direction — The Tribunal may issue a direction resolving a
matter for which relief is requested under subrule (1) or direct the party to
proceed by way of motion.
Formal Procedure
82. Application — Rules 83 to 88 apply to all motions except for a motion
for leave to intervene referred to in rule 42 or a motion for summary disposi-
tion referred to in rule 89.
83. (1) Notice of motion — A motion shall be commenced by notice of mo-

tion, setting out the grounds for the motion and the order sought.
460
Part 3 — Motions R. 89(2)
(2) Content — A notice of motion shall be accompanied by any supporting

affidavits and other admissible evidence.
(3) Service — The moving party shall serve the notice of motion on each
other party and any intervenors and file the notice of motion with proof of
service.
84. (1) Disposition without hearing — A moving party may request in

writing that the Tribunal dispose of the motion without a hearing.
(2) Disposition with a hearing — If a hearing is to be held, the notice of
motion shall indicate that the motion is returnable at a date and time and in a
manner directed by the Tribunal.
85. (1) Service of response — A party or intervenor served with a notice

of motion may, no later than seven days after being served, serve on the mov-
ing party and on each other party and intervenor a response stating the
grounds on which the motion is opposed and any supporting affidavits.
Tribunal
Rules
(2) Filing — The response and supporting affidavits, if any, shall be filed with
proof of service within the period set out in subrule (1).
86. Decision without a hearing — The responding party may request in

writing that the Tribunal dispose of the motion without a hearing.
87. Evidence and memorandum — The moving party and the respond-
ing party shall, no later than 10 days after the service of the response, serve on
each other party and on any intervenors and file with proof of service
(a) any supplementary evidence to be relied on by the party, including
transcripts; and
(b) a memorandum of fact and law.
88. (1) Testimony by affidavit — Subject to subrule (2), testimony on a

motion shall be by affidavit.
(2) Oral testimony — The judicial member designated to preside at the
hearing of a motion may, before or during the hearing, grant leave for oral
testimony in relation to an issue raised in the notice of motion.
Motion for Summary Disposition

89. (1) Notice of motion — A motion for summary disposition under sub-
section 9(4) of the Competition Tribunal Act shall be commenced by a notice of
motion, which shall set out the grounds for the motion and the order sought.
(2) Timing — A party to an application may bring a motion for summary
disposition under subsection 9(4) of the Competition Tribunal Act after the re-
461
spondent has filed a response to the application and at a time that enables the
moving party to meet the deadline for the hearing of motions prescribed dur-
ing a case management conference.
(3) Content — The notice of motion shall be accompanied by
(a) a memorandum of fact and law; and
(b) any supporting affidavits and other admissible evidence.
(4) Service — The moving party shall serve the notice of motion and the ac-
companying documents referred to in subrule (3) on each other party and any
intervenors and shall file those documents with proof of service.
90. (1) Response — A party served with a motion for summary disposition
may, no later than 10 days after being served, serve a response on the moving
party and on each other party and any intervenors.
(2) Content — The response shall be accompanied by
(a) a memorandum of fact and law; and
(b) any supporting affidavits and other admissible evidence.
(3) Filing — The response and accompanying documents referred to in sub-
rule (2) shall be filed with proof of service within the period set out in subrule
(1).
(4) Genuine basis for application — A response to a motion for sum-
mary disposition shall not rest merely on allegations or denials of the plead-
ings of the moving party, but must set out specific facts showing that there is a
genuine basis for the application or the response to the application.
91. Testimony — Unless otherwise ordered, there shall be no oral testimony

on a motion for summary disposition.
92. Power of the Tribunal — The Tribunal may dismiss or allow the appli-
cation in whole or in part in accordance with subsection 9(5) of the Competi-
tion Tribunal Act.
93. Motion — refused or granted in part — If a motion for summary

disposition is refused or is granted only in part, the Tribunal may make an
order specifying any issues that are not in dispute and defining the issues to be
determined.
94. Motion refused — If a motion for summary disposition is refused, the

moving party may not make a further motion under rule 89 without leave of
the Tribunal.
462
Part 4 — Interim or Temporary Orders R. 98(2)
PART 4 — INTERIM OR TEMPORARY ORDERS

Application
95. Application of Part — This Part applies to applications for
(a) temporary orders made under subsection 74.11(1) of the Act in decep-
tive marketing practices cases before the Commissioner completes an in-
quiry and extensions to those temporary orders under subsection 74.11(5)
of the Act;
(b) interim orders made under subsection 100(1) of the Act in merger
cases before the Commissioner completes an inquiry and extensions to
those interim orders under subsection 100(7) of the Act;
(c) interim orders made under subsection 103.3(1) of the Act in review-
able practices cases before the Commissioner completes an inquiry and
extensions to those interim orders under subsections 103.3(5) and (5.3) of
the Act or variations to them under subsection 103.3(7) of the Act; and
Tribunal
Rules
(d) interim orders made under subsection 104(1) of the Act in merger and
reviewable practices cases after an application has been made to the
Tribunal.
96. (1) Notice of application — Applications for interim or temporary or-

ders and extensions to those orders shall be made by filing a notice of applica-
tion, which shall set out the grounds for the application and the order sought.
(2) Content — The notice of application shall be accompanied by any sup-
porting affidavits that the applicant intends to rely on.
(3) Service and filing — In respect of applications made under subsection
104(1) of the Act, rule 37 applies to the service and filing of the notice of appli-
cation, with any modifications that the circumstances require.
Language of Hearing
97. Official language — A person against whom an interim order or a tem-
porary order is sought shall inform the Registrar as soon as possible of the
official language that that person intends to use at the hearing.
Ex Parte Orders
98. (1) Service of ex parte orders — Any ex parte order of the Tribunal
shall be served by the Commissioner on the person against whom the order
was obtained.
(2) Time and manner of service — The time and manner for effecting
service shall be established by the Tribunal according to the circumstances.
463
Application to Vary or Set Aside Interim Orders

99. (1) Notice of application — An application under subsection 103.3(7)
of the Act to vary or set aside an interim order under subsection 103.3(1) of
the Act shall be made by filing an application that satisfies the requirements of
rule 96.
(2) Service — The applicant shall, within 48 hours after a notice of applica-
tion is filed, serve the application referred to in subrule (1) on the
Commissioner.
(3) Proof of service — The applicant shall, within 48 hours after the service
of the application, file proof of service.
PART 5 — SPECIALIZATION AGREEMENTS

100. (1) Notice of application — An application under subsection 86(1) of
the Act for the registration of an agreement as a specialization agreement shall
be made by filing a notice of application to which is appended a copy of the
agreement.
(2) Form and content — A notice of application shall be signed by the ap-
plicant or on behalf of the applicant and shall set out, in numbered
paragraphs,
(a) the name and address of each party to the agreement;
(b) whether the agreement has been entered into or is about to be entered
into;
(c) a concise statement of the grounds on which the applicant relies in
asking the Tribunal to find that the agreement is a specialization agree-
ment and that implementation of the agreement will achieve the results
described in paragraph 86(1)(a) of the Act;
(d) a concise statement of the grounds on which the applicant relies in
asking the Tribunal to find that the circumstances described in para-
graph 86(1)(b) of the Act exist;
(e) the period for which registration of the agreement is requested; and
(f) the official language that the applicant intends to use in the
proceedings.
(3) Service — The applicant shall, within five days after a notice of applica-
tion is filed, serve the notice on the Commissioner.
(4) Proof of service — The applicant shall, within five days after service of
the notice of application, file proof of service.
101. (1) Notice of appearance — The Commissioner may, within 14 days

after being served with a notice of application in accordance with subrule
464
Part 6 — Consent Agreements R. 106(1)
100(3), serve a notice of appearance on the applicant and shall file it with
proof of service.
(2) Service and filing — The Commissioner shall, within 30 days after
serving a notice of appearance,
(a) serve on the applicant a concise statement of the grounds on which the
application is opposed or supported and the material facts relevant to
those grounds on which the Commissioner relies; and
(b) file the statement with proof of service.
102. (1) Motion for registration — If the Commissioner has not filed a no-
tice of appearance or a statement within the applicable period set out in sub-
rule 101(1) or (2), the applicant may move for an order directing that the
agreement be registered.
(2) Decision — On a motion under subrule (1), the Tribunal shall, if it is
satisfied that the notice of application was served in accordance with these
Rules and it has heard any evidence that it may require, make any order that
Tribunal
Rules
it deems appropriate.
103. (1) Reply — An applicant may, within 14 days after being served with a
statement, serve on the Commissioner a reply dealing with the matters raised
in the statement.
(2) Filing — The applicant shall file the reply with proof of service.
(3) Deemed denied — If the applicant does not file a reply, the applicant is
deemed to have denied each ground and each material fact relevant to each
ground set out in the statement.
104. Modification and removal — The provisions of this Part relating to

an application for the registration of an agreement apply, with any modifica-
tions that the circumstances require, to every application
(a) under subsection 87(1) of the Act with respect to the registration of a
modification to a specialization agreement; or
(b) under subsection 87(2) of the Act with respect to the removal of a spe-
cialization agreement or of a modification to a specialization agreement
from the register.
PART 6 — CONSENT AGREEMENTS

105. Application of Part — This Part applies in respect of all consent
agreements filed under sections 74.12 and 105 of the Act.
106. (1) Registration of consent agreements — A consent agreement

under section 74.12 or 105 of the Act shall be made by filing the agreement.
465
(2) Content — The consent agreement shall be signed by the parties to the
agreement and shall set out
(a) the sections of the Act under which the agreement is made;
(b) the name and address of each person in respect of whom the agree-
ment is sought; and
(c) the terms of the agreement.
(3) Translation — A translation of the consent agreement in the other offi-
cial language shall be filed within 10 days after the filing of the agreement.
PART 7 — REFERENCES
107. Application of Part — This Part applies to every reference made to
the Tribunal under section 124.2 of the Act.
108. (1) Notice of reference — A reference shall be made by filing a notice

of the reference under subsection 124.2(2) of the Act or a joint notice under
subsection 124.2(1) of the Act that sets out
(a) the name of the applicant; and
(b) the question being referred.
(2) Reference record — A notice of reference shall be accompanied by a
reference record, which may include any affidavit setting out the facts on
which the reference is based or an agreed statement of facts, and shall include
a memorandum of fact and law.
109. (1) Service — In the case of a reference made by the Commissioner and
arising in proceedings before the Tribunal, the Commissioner shall serve the
notice of reference and the reference record on all other parties to the pro-
ceeding and on any intervenors.
(2) Service by other parties — Any other party to the proceedings in
which the reference arises may serve and file a responding reference record
within 14 days after being served with the notice of reference.
110. (1) Amicus curiae — Without restricting the general powers of the Tri-
bunal to appoint an amicus curiae in appropriate circumstances, the Tribunal
may appoint an amicus curiae when the Commissioner files a notice of refer-
ence under subsection 124.2(2) of the Act.
(2) Fees and disbursements — The fees and disbursements related to the
amicus curiae shall be fixed by the Tribunal and be paid by the party desig-
nated by the Tribunal after hearing submissions.
466
Part 8 — Private Access R. 116(2)
111. (1) Leave to refer in a private access case — An application for

leave to refer a question to the Tribunal under subsection 124.2(3) of the Act
shall be made by filing a notice of the application for leave.
(2) Content — The notice of application for leave shall include the following
information and documents:
(a) the name of the applicant;
(b) the notice of reference;
(c) an affidavit setting out the facts to be relied on, if any; and
(d) a memorandum of fact and law.
112. Notice to the Commissioner — The parties shall, within five days
after a notice of application for leave to refer a question is filed, serve the no-
tice of the application for leave on the Commissioner.
113. (1) Power of Tribunal — The Tribunal may grant an application for
leave to refer a question, with or without conditions, or refuse the application.
Tribunal
Rules
(2) Leave granted — If leave is granted, a notice of reference shall be filed,
accompanied by the reference record, in accordance with rule 108.
PART 8 — PRIVATE ACCESS

114. Application of Part — This Part applies to applications for leave
under subsection 103.1(1) of the Act and to consent agreements filed by per-
sons other than the Commissioner.
115. (1) Application for leave — An application under subsection 103.1(1)

of the Act for leave to make an application under section 75 or 77 of the Act
shall be made by filing an application for leave including an affidavit setting
out the facts in support of the proposed application, a proposed notice of ap-
plication and a memorandum of fact and law.
(2) Information — The proposed notice of application under section 75 or 77
of the Act shall set out the information referred to in subrule 36(2).
116. (1) Service — The applicant shall, within five days after the application
for leave is filed, serve a copy of the application for leave on each person
against whom an order is sought and on the Commissioner.
(2) Proof of service — The applicant shall, within five days after the ser-
vice of the copy of the application for leave, file proof of service.
467
117. Certification by the Commissioner — The certification by the

Commissioner under subsection 103.1(3) of the Act shall be made by filing a
letter.
118. Notice by the Tribunal — The Tribunal shall, within five days after
receiving the Commissioner’s certification, notify the applicant, the Commis-
sioner and any person against whom an order is sought under section 75 or 77
of the Act as to whether the hearing of the application for leave is precluded
by the operation of subsection 103.1(4) of the Act.
119. (1) Representations in writing — A person served with an applica-

tion for leave referred to in rule 115 who wishes to oppose the application
shall, within 15 days after receiving the Tribunal’s notice under rule 118,
(a) serve a copy of their representations in writing on the applicant, on
any other person against whom the order is sought and on the Commis-
sioner; and
(b) file the representations with proof of service.
(2) Content — Representations in writing shall contain a memorandum of
fact and law and shall set out the official language the person opposing the
application intends to use.
(3) Affidavit evidence — Representations in writing shall not contain affi-
davit evidence, except with leave of the Tribunal.
Case Law
Stargrove Entertainment Inc. v. Universal Music Publishing Group Canada, 2015 Comp.
Trib. 26 (Competition Trib.) — The Tribunal held that it was irregular for respondents to
have filed affidavit evidence and to have made further submissions without leave when leave
was required. Although the Rules contemplate a degree of informality, they do not counte-
nance unlimited, unrestrained and unauthorized filings.
120. Reply — The person making an application for leave under section 103.1
of the Act may serve a reply on each person against whom an order is sought
and on the Commissioner within seven days after being served with the repre-
sentations in writing under rule 119 and shall file the reply with proof of
service.
Case Law
Audatex Canada, ULC v. CarProof Corporation, 2015 Comp. Trib. 28 (Competition
Trib.) — The respondents requested that the plaintiff’s reply be struck from the record, since
Rule 120 only does not contemplate that a person may serve a “reply record” as the leave
application stage. The Tribunal held that the Rule 120 does not provide for the right to file an
entire reply record. The only reasonable interpretation of the Rule is that no reply affidavit
evidence is to be submitted.
468
Part 8 — Private Access R. 127
121. Decision without oral hearing — The Tribunal may render its deci-
sion on the basis of the written record without a formal oral hearing.
122. Power of Tribunal — The Tribunal may grant the application for
leave to make an application, with or without conditions, or refuse the
application.
123. Service — The Registrar shall serve the decision without delay on the
applicant, on each person against whom an order is sought and on the Com-
missioner who may intervene under section 103.2 of the Act.
124. (1) Leave granted — If leave is granted in full, the notice of application
that the applicant proposed to file is, for the purposes of the proceedings,
deemed to have been filed and served on the date on which the order granting
leave was made.
(2) Leave granted in part — If leave is granted in part, an amended notice,
Tribunal
in accordance with the order granting leave, shall be filed and served within
Rules
five days after the order is made.
125. Registration — The filing of a consent agreement by parties to a pri-

vate action under section 106.1 of the Act shall be made in accordance with
rule 106.
126. (1) Publication — After the filing of a consent agreement by parties to a

private action under section 106.1 of the Act, the Registrar shall publish with-
out delay a notice in the Canada Gazette.
(2) Content — The notice shall state
(a) that a consent agreement has been filed for registration;
(b) the name of each party to the agreement;
(c) the text of the agreement;
(d) that access to the agreement and any documents filed in the matter
may be obtained at the office of the Registrar; and
(e) the date on or before which an application made under subsection
106.1(4) of the Act for the cancellation or replacement of the agreement
must be filed.
127. Service — A copy of a notice of application made by a third party to

cancel or replace a consent agreement between parties to a private action shall
be served on the Commissioner within five days after the notice of application
is filed.
469
PART 9 — APPLICATION FOR A LOAN ORDER

128. Notice — Before filing an application with the Tribunal for a loan order
under subsection 30.19(2) of the Act, the Commissioner or the representative
of the Commissioner shall give notice in writing to the Chairperson and to the
parties to the proceedings.
129. (1) Filing — The Commissioner or the representative of the Commis-

sioner shall file the notice referred to in rule 128 at least 10 days before filing
the application for a loan order.
(2) Service — The Commissioner or the representative of the Commissioner
shall, within five days after the notice is filed, serve it on the parties to the
proceedings.
130. (1) Notice of application — An application for a loan order by the

Commissioner or the representative of the Commissioner shall be made by fil-
ing a notice of application.
(2) Content — A notice of application shall be in accordance with the re-
quirements set out in subsection 30.19(3) of the Act and shall set out, in num-
bered paragraphs,
(a) the sections of the Act under which the application is made;
(b) the names of the parties to the proceedings;
(c) a concise statement of the grounds on which the application for a loan
order is made and of the material facts on which the Commissioner relies;
(d) the terms of the loan order sought; and
(e) the official language that the Commissioner intends to use in the
proceedings.
131. (1) Service — The Commissioner shall, within five days after a notice of
application for a loan order is filed, serve the notice on the parties to the
proceedings.
(2) Proof of service — The Commissioner shall, within five days after the
service of the notice of application, file proof of service.
132. (1) Response — A person served with a notice of application for a loan
order under subsection 30.19(2) of the Act and who wishes to oppose the appli-
cation shall, within 15 days after receiving the notice of application,
(a) serve a response on the Commissioner and the other parties to the
proceedings; and
(b) file the response with proof of service.
470
Part 10 — Case Management R. 136
(2) Form and content — A response shall set out, in numbered paragraphs,
(a) a concise statement of the grounds on which the application for a loan
order is opposed and of the material facts on which the person opposing
the application relies;
(b) an admission or denial of each ground and of each material fact rele-
vant to each ground set out in the application for a loan order; and
(c) the official language that the person opposing the application for a
loan order intends to use in the proceedings.
133. (1) Decision — The Tribunal may render its decision on the basis of the
written record without a formal oral hearing.
(2) Power of the Tribunal — The Tribunal may grant the application for a
loan order, with or without conditions, or refuse the application.
PART 10 — CASE MANAGEMENT
Tribunal
Rules
134. (1) Definition of “judicial member” — For the purposes of this Part,
“judicial member” means the Chairperson or a judicial member designated by
the Chairperson.
(2) Powers of a judicial member — Case management duties do not pre-
clude a judicial member from presiding at the hearing of an application or
reference.
135. (1) Case management conferences — Subject to subrules (2) and

(3), the judicial member shall conduct one or more case management confer-
ences as soon as is practicable after the end of the period for filing a reply, or
after the filing of a notice of reference, or sooner if indicated by the
circumstances.
(2) Specialization agreements — In the case of an application for the re-
gistration of a specialization agreement, the judicial member shall conduct a
case management conference as soon as is practicable after the Commissioner
has filed proof of service of a notice of appearance in accordance with subrule
101(1).
(3) Loan order — In the case of an application for a loan order, if the judi-
cial member deems that a hearing is necessary, the judicial member shall con-
sult the parties with respect to any case management procedures within seven
days after proof of service of the response to the application for a loan order
has been filed.
136. Directions re scheduling — The judicial member shall issue direc-

tions with respect to the scheduling of case management conferences.
471
137. (1) Direction regarding list of matters to be considered — The

judicial member may include in the directions referred to in rule 136 a list of
the matters to be considered at the case management conference and may re-
quire the filing of memoranda regarding any of those matters.
(2) Matters to be considered — Those matters may include
(a) the start date, duration and location of the hearing, as well as the me-
dium for the hearing;
(b) any pending or anticipated motions, and a deadline date for the hear-
ing of motions;
(c) any issues of confidentiality;
(d) the clarification, simplification and elimination of issues;
(e) the possibility of obtaining admissions of particular facts or docu-
ments, including an agreed statement of facts;
(f) a deadline for the completion of discovery, related motions and an-
swering undertakings;
(g) the official language to be used for the pleadings and the hearing, as
well as the official language in which each witness shall testify;
(h) in the case of a reference, the determination of whether there shall be
oral evidence;
(i) a timetable for the exchange or serving and filing of the various docu-
ments related to the hearing, including affidavits of documents, joint
briefs of authorities and agreed books of documents;
(j) any matter relating to pre-hearing disclosure;
(k) a timetable to be followed by the intervenors;
(l) all matters related to expert witnesses, including the possibility of ex-
perts meeting before a hearing to answer questions posed by the
Tribunal;
(m) any amendments to the pleadings;
(n) the advisability of a pre-hearing reference or determination of a ques-
tion of law;
(o) any requirement for a notice of a constitutional question;
(p) a timetable for the subsequent case management conferences; and
(q) any other matters that may aid in the disposition of the application.
138. Order — After a case management conference, the Tribunal shall issue
an order stating any rulings by the Tribunal relating to the matters considered
at the case management conference.
139. (1) Firm requirements — The dates set and other requirements estab-
lished by case management orders are firm.
472
Schedule 1 — Affidavit of Service of an Originating Document Sch. 1
(2) Variation — A request for a variation must be made by motion showing

that compelling reasons exist for a change in the order.
(3) Tribunal may amend — If the Tribunal is satisfied that compelling rea-
sons exist for a change in the order, it may amend it.
PART 11 — TRANSITIONAL PROVISION AND REPEAL

140. Proceeding already commenced — These Rules apply only to pro-
ceedings commenced after these Rules come into effect.
Repeal
141. Repeal — The Competition Tribunal Rules1 are repealed.
Tribunal
Rules
SCHEDULE 1 — AFFIDAVIT OF SERVICE OF AN
ORIGINATING DOCUMENT
(Subrule 11(1))
(title of proceedings)
I, (full name), resident at (address), swear [affirm] that:
1. individual
On (date), at (time), I served (name of individual served) with (name of docu-
ment) by leaving a certified copy with that person at (address where service
was made).
2. partnership
On (date), at (time), I served (name of partnership served) with the (name of
document) by leaving a certified copy with (name of partner) at (address
where service was made).
3. corporation
On (date), at (time), I served (name of corporation served) with the (name of
document) by leaving a certified copy with (name and position of the officer or
person apparently in charge of the head office or a branch of the corporation)
at (address where service was made).
4. Commissioner
1 SOR/94-290
473
Sch. 1 Can. Reg. 2008-141 — Competition Tribunal Rules
On (date), at (time), I served the Commissioner with the (name of document)

by leaving a certified copy with (name of the person with whom the copy was
left) at (address where service was made).
5. a person represented by counsel who is willing to accept service
(a) On (date), at (time), I served (name of person represented) with the
(name of document) by leaving a certified copy with (name of legal coun-
sel), counsel for (name of person represented), at (address where service
was made).
(b) (Name of counsel) informed me that [he/she] was willing to accept ser-
vice on behalf of (name of person represented by counsel).
SWORN etc.
..........
(Signature of deponent)
SCHEDULE 2 — AFFIDAVIT OF SERVICE OF A

DOCUMENT OTHER THAN AN ORIGINATING DOCUMENT
(Subrule 11(1))
(title of proceedings)
I, (full name), resident at (address), swear [affirm] that:
1. by leaving a copy
On (date), at (time), I served (name of person served) with the (name of docu-
ment) by leaving a copy of the document at (address of person or of counsel’s
office where service was made).
2. by sending a copy by facsimile transmission
On (date), at (time), I served (name of person served) with the (name of docu-
ment) by sending a copy of the document, including a cover page, by facsimile
transmission to (name of person or counsel) at (fax number).
3. by sending a copy by registered mail and obtaining an acknowledgement of
receipt
(a) On (date), at (time), I sent the (identify document) by registered mail
to (name of person or counsel) at (address of person or of counsel’s
office).
(b) I attach an acknowledgement of receipt indicating that the document
was received on (date).
SWORN etc.
..........
(Signature of deponent)
474
Schedule 3 — Counsel’s Certificate of Service Sch. 3
SCHEDULE 3 — COUNSEL’S CERTIFICATE OF SERVICE

(Subrule 11(2))
I, (name of counsel or designate), counsel (or designate of legal counsel), cer-

tify that on (date of service), I caused (name of party served) to be duly served
with (name of document), by (method of service), on behalf of (party on behalf
of whom the document is served).
...................................
(Signature of counsel or designate)
Tribunal
Rules
475
Regulatory Impact Analysis Statement1
(This statement is not part of the Rules.)
Description
The Competition Tribunal, created by the Competition Tribunal Act, R.S. 1985, c.
19 (2nd Supp.), is a quasi-judicial body that hears and disposes of applications and
any related matters under Part VII.1 (Deceptive Marketing Practices) and Part VIII
(Reviewable Matters by the Tribunal) of the Competition Act, R.S. 1985, c. C-34.
Section 16 of the Competition Tribunal Act provides that the Competition Tribunal
may make general rules for regulating its practice and procedure with the approval
of the Governor in Council. The annexed Rules revoke and replace the Rules en-
acted on April 14, 1994 (SOR/94-290).
There is a need to thoroughly revise the Rules, in order to make them better suited
to the cases before the Tribunal. The need stems from several factors. First, amend-
ments were made to the Competition Act in 2002, creating new processes before
Tribunal
Rules
the Tribunal, yet the Rules did not reflect these new processes. Second, case man-
agement had to be streamlined. Third, more efficient processes were needed to ex-
pedite matters before the Tribunal, while ensuring a fair process.
In particular, the new Rules meet the following objectives:
1. Integrate the practice directions in the Rules. The Tribunal had to supplement
the Rules amended in 2002 with two practice directions, one dealing with
electronic filings and hearings, the other with various proceedings introduced
in the 2002 amendments to the Competition Act (S.C. 2002, c. 16). The new
Rules incorporate the Tribunal’s two practice directions. This means that all
the Tribunal’s rules of practice and procedure are now found in one document,
making it easier for applicants before the Tribunal to obtain the information
they need.
2. Develop a comprehensive case management procedure. Whereas in the old
Rules various proceedings gave rise to varying case management procedures,
all case management is now dealt with in Part 10, in order to avoid both repe-
tition and confusion. Case management is an important component of the new
Rules, its objective being to streamline the application process and more
clearly delineate the issues.
The new case management rules also afford the Tribunal the flexibility it
needs to deal effectively with all cases. Case management will begin as soon
as possible, and be tailored to the requirements of each case. The Tribunal will
be actively engaged in helping the parties define the issues and prepare their
case to expedite the process.
1 This statement was published in the Canada Gazette, Part II, Vol. 142, No. 10 (May 14,
2008).
477
Regulatory Impact Analysis Statement
3. Adopt a single procedure for all applications before the Tribunal. The old
Rules provided different procedures and timelines for mergers and restrictive
trade practices, leading to some confusion. The new Rules provide for a single
process for both merger and restrictive trade practices applications, making
them easier to follow.
4. Reinstate the relevance standard for discovery. After an attempt (in the 2002
Rules amendments) to have discovery based on documents to be relied upon
(reliance standard) as opposed to disclosing all relevant material (relevance
standard), the Tribunal has decided to return to the relevance standard for dis-
covery in order to ensure fairness for all parties.
5. Implement procedures to make hearings more efficient. The reliance standard
will be kept for pre-hearing disclosure purposes: parties will know in advance
what evidence in chief will be used at the hearing, a practice which will de-
crease significantly the length of the hearings and better focus the issues. In
addition, the new Rules allow the Tribunal to make better use of the parties’
experts. For example, they may be asked to confer before a hearing in order to
answer questions posed by the Tribunal. As well, if the need arises, the Tribu-
nal may appoint its own expert.
6. Provide a more logical structure for the Rules. The new Rules now offer a
more structured approach to the various Tribunal procedures. This is reflected
by the marked increase in the number of parts, from two to eleven. It is hoped
this change will make the Rules clearer and easier to follow.
Alternatives
There are no realistic alternatives. The Competition Tribunal Act gives authority to
the Tribunal to make rules regulating its practice and procedure.
Benefits and costs

These Rules improve the Tribunal’s procedures in accordance with its statutory
mandate to resolve matters before it as informally and expeditiously as circum-
stances and considerations of fairness permit. They will benefit the public by mak-
ing Tribunal proceedings more efficient, thus ensuring cost savings to those who
appear before the Tribunal, i.e. Canadian businesses and the Commissioner of
Competition.
Efficiency is fostered through provisions that govern new proceedings, case man-
agement, pre-hearing and hearing procedures. An important feature recognized in
the new Rules is the extensive use the Tribunal makes of electronic technology, for
notification, filing and hearing purposes.
Consultation
The development of the new Rules was undertaken in cooperation with the Tribu-
nal-Bar Liaison Committee. It is composed of Lay and Judicial Tribunal members,
Tribunal Legal and Registry staff, and representatives of the Competition Bureau,
478
Justice Canada and the National Competition Law Section of the Canadian Bar
Association.
The Liaison Committee appointed a working group in November 2005 to develop a
set of draft rules which would be submitted as a recommendation to the Tribunal.
The members of the working group met regularly during a six-month period and
produced several drafts of the new Rules which were thoroughly discussed within
the various constituencies represented in the Liaison Committee. The final draft of
the working group was presented to the judicial members of the Tribunal, who
carefully reviewed and revised it. An overview of the new draft Rules was presen-
ted at the Fall 2006 Conference of the Competition Law Section of the Canadian
Bar Association.
On May 26, 2007, the draft Rules were pre-published in Part I of the Canada Ga-
zette. Stakeholders were invited to send written comments to the Tribunal’s Regis-
trar. Written submissions were received from the National Competition Law Sec-
tion of the Canadian Bar Association.
These suggestions, as well as the responding comments provided by representatives
Tribunal
of the Competition Bureau and Justice Canada, were carefully studied and the new
Rules
Rules were modified to incorporate some of the suggestions received.
In particular, Rules 20, 62, 68 and 77 were changed. The requirement for a secure
electronic signature was removed from Rule 20 to facilitate electronic filing.
Changes were made to Rule 62 (implied undertaking) to provide greater clarity.
The timelines in Rules 68 and 77 were changed from 45 days to 60 days. This
change gives responding parties more time to prepare and serve their responding
materials after they have been served with the applicant’s lay witness statement(s),
list of documents and expert report(s).
Compliance and enforcement

Compliance with the new Rules does not entail any additional costs. The Registry
of the Tribunal will publish the new Rules on its Web site and ensure that the legal
and business communities are made aware of the changes in its rules of practice
and procedure.
Pursuant to section 8 of the Competition Tribunal Act, the Tribunal has, with re-
spect to the enforcement of its orders and procedural matters necessary for the due
exercise of its jurisdiction, all such powers, rights and privileges as are vested in a
superior court of record.
479
Contact
Raynald Chartrand
Deputy Head and Registrar
90 Sparks Street, Suite 600
Ottawa, Ontario
K1P 5B4
Telephone: 613-957-7851
Email: raynald.chartrand@ct-tc.gc.ca
480
PROCEDURES GUIDE FOR NOTIFIABLE
TRANSACTIONS AND ADVANCE RULING
CERTIFICATES UNDER THE COMPETITION ACT*
Table of contents
1. — Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. — Notifiable transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 483

2.1 Purposes of pre-merger notification . . . . . . . . . . . . . . . . . . . . . . . . . 483
2.2 Determining whether a proposed transaction is notifiable . . . . . . . . 483
2.3 Further acquisition of voting shares or interest in a combination . . . 486
2.4 Information to be supplied the notification . . . . . . . . . . . . . . . . . . . 487
Guidelines
2.4.1 Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 487
2.4.2 Information that cannot be supplied . . . . . . . . . . . . . . . . . . . 488
2.4.3 Irrelevant information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 488
2.4.4 Previously supplied information . . . . . . . . . . . . . . . . . . . . . . 488
2.4.5 Omitted information may be required . . . . . . . . . . . . . . . . . . 488
2.4.6 Information requested does not exist . . . . . . . . . . . . . . . . . . . 489
2.5 Waiting periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 489
2.6 Transactions to which subsection 114(3) of the Act applies . . . . . . . 490
2.7 When should parties notify? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 491
2.8 Failure to notify . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 492
2.9 Interpretation Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 492
3. — Advance Ruling Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . 493

3.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 493
* Procedures Guide for Notifiable Transactions and Advance Ruling Certificates under the
Competition Act, (November 1, 2010), (Web Page Date Modified: 2020-04-01), Innovation,
Science and Economic Development Canada, https://www.competitionbureau.gc.ca/eic/site/
cb-bc.nsf/eng/03302.html. Reproduced with the permission of the Minister of Innovation,
Science and Economic Development, 2020. The content of this publication may be subject to
change or may be removed from the Government website without notice.
481
Procedures Guide for Notifiable Transactions
3.2 Factors relevant to the consideration of an ARC (Advance Ruling Certifi-

cates) request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 494
3.3 Information to be submitted with an ARC (Advance Ruling Certificates)
request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 494
3.4 When to request an ARC (Advance Ruling Certificates) . . . . . . . . . 495
4. — Procedural matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 495

4.1 Merger Notification Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 495
4.2 Submission of a notification or ARC (Advance Ruling Certificates)
request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 496
4.2.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 496
4.2.2 Submitting a notification and/or ARC (Advance Ruling Certifi-
cates) request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 497
4.2.3 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 499
4.2.4 Receipt and acknowledgment of notifications and ARC (Advance
Ruling Certificates) requests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 499
4.2.5 Withdrawing and resubmitting a notification . . . . . . . . . . . . . 500
4.2.6 Foreign language documents . . . . . . . . . . . . . . . . . . . . . . . . . 500
4.3 Submission of responses to voluntary information requests . . . . . . . 500
4.4 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 501
5. — How to contact the Competition Bureau . . . . . . . . . . . . . . . . . 501
6. — Appendix “A” Cover letter checklist . . . . . . . . . . . . . . . . . . . . . 501

1. — Introduction
This Procedures Guide (“Guide”) relates to notifiable transactions and advance rul-
ing certificates under the Competition Act (the “Act”), and provides:
• an overview of the relevant provisions of Part IX of the Act and the Notifiable
TransactionsRegulations (the “Regulations”);
• an explanation of the general approach taken by the Competition Bureau (the
“Bureau”) to pre-merger notification matters;
• guidance in determining how the Act may apply to a proposed transaction; and
• information regarding requests for, and issuance of, advance ruling certificates
(“ARC(Advance Ruling Certificates)”) under sections 102 and 103 of the Act.
This Guide supercedes all previous statements of the Commissioner of Competition
(the “Commissioner”) and other Bureau officials regarding notification and ARC
(Advance Ruling Certificates) request procedures.
Merger transactions vary greatly in size, scope and structure. As such, this Guide
cannot provide a comprehensive review of all notification issues that may arise.
Firms contemplating notifying the Bureau of a proposed transaction are encouraged
482
to seek advice from legal counsel. Guidance regarding the applicability or interpre-
tation of Part IX of the Act or the Regulations can also be obtained by requesting a
binding written opinion from the Commissioner pursuant to section 124.1 of the
Act.
This Guide does not replace the advice of legal counsel and is not intended to re-
state the law or to constitute a binding statement of how the Commissioner will
exercise discretion in a particular situation. The enforcement decisions of the Com-
missioner and the ultimate resolution of issues will depend on the particular cir-
cumstances of the matter in question. Final interpretation of the law is the responsi-
bility of the Competition Tribunal (the “Tribunal”) and the courts.
The Bureau may revisit certain aspects of this Guide in light of experience and
changing circumstances.
2. — Notifiable transactions
2.1 — Purposes of pre-merger notification
Part IX of the Act sets out the statutory framework for pre-merger notification,
which requires parties to proposed transactions that exceed certain monetary
thresholds to:
a. notify the Commissioner prior to completing the proposed transaction;
Guidelines
b. provide specified information; and
c. wait a specified period of time before completing the transaction.
The purposes of notification are to:
i. provide the Commissioner with advance notice of large proposed
transactions;
ii. provide the Commissioner with a sufficient period of time to undertake an
analysis of the impact of the proposed transaction;
iii. facilitate this analysis by ensuring that certain required information is sub-
mitted to the Commissioner with the notice; and
iv. avoid the difficulties associated with remedying a completed merger,
where that merger is subsequently found to be anti-competitive.
2.2 — Determining whether a proposed transaction is notifiable

Determining whether a proposed transaction is notifiable generally involves the
four steps set out below. Where the first three steps are satisfied and there is no
applicable exemption in step four, the transaction is notifiable. In certain cases, one
or more of these steps may require further analysis before reaching a conclusion as
to whether a transaction is notifiable.
Section 114 of the Act requires that all parties to a proposed transaction that ex-
ceeds the thresholds set out in sections 109 and 110 of the Act must notify the
Commissioner prior to the completion of the transaction and supply the Commis-
sioner with certain information. Section 123 of the Act sets out the waiting periods
483
during which the parties to a proposed transaction are legally prohibited from clos-
ing the transaction.
Step 1: — Determine whether the structure of the proposed transaction falls

within section 110 of the Act
Section 110 of the Act addresses the following transaction structures:
i. the acquisition of any of the assets in Canada of an operating business2;
ii. the acquisition of voting shares of a corporation that carries on an operating
business or controls a corporation that carries on an operating business;
iii. the amalgamation of two or more corporations, if one or more of those
corporations carries on an operating business or controls a corporation that
carries on an operating business;
iv. the creation of a combination of two or more persons3 to carry on business
otherwise than through a corporation, where one or more of those persons pro-
poses to contribute to the combination assets that form all or part of an operat-
ing business carried on by those persons, or corporations controlled by those
persons; and
v. the acquisition of an interest in a combination. If the proposed transaction is
of a type described above, the parties should consider whether the party-size
and transaction-size thresholds have been exceeded.
Step 2: — Determine whether the parties exceed the party-size threshold in

section 109 of the Act
For purposes of pre-merger notification, section 109 of the Act requires that the
parties to the proposed transaction, together with their affiliates4, must collectively
have assets in Canada or annual gross revenues from sales in, from or into Canada
that exceed $400 million. The Regulations outline the procedure for calculating the
value of assets and gross revenues from sales.
Where the proposed transaction involves the acquisition of voting shares, subsec-
tion 109(2) of the Act specifies that the parties to the proposed acquisition of shares
are:
1. the person(s) who propose to acquire the shares; and
2. the corporation whose shares are being acquired.
2 “Operating business” is defined in subsection 108(1) of the Act as a business undertaking

in Canada to which employees employed in connection with the undertaking ordinarily re-
port for work. For further information on the definition of operating business, please refer to
Interpretation Guideline No. 1 Section 108. Definition of “operating business”.
3 “Person” is defined in subsection 108(1) of the Act.
4 Affiliate means an affiliated corporation, partnership or sole proprietorship as described in
subsection 2(2) of the Act.
484
Step 3: — Determine whether the proposed transaction exceeds the

applicable transaction-size threshold specified in subsections 110(2) to
110(6) of the Act
Generally, for purposes of pre-merger notification, the aggregate value of the assets
in Canada, or the annual gross revenues from sales in or from Canada generated
from those assets, must exceed the transaction-size threshold amount (the “TSTA
(transaction-size threshold amount)”). The 2009 amendments to the Act increased
the TSTA (transaction-size threshold amount) to $70 million and introduced an in-
dexing mechanism5 for subsequent years to adjust the TSTA (transaction-size
threshold amount) based on changes in the level of Nominal Gross Domestic Prod-
uct at market prices. The TSTA (transaction-size threshold amount) when deter-
mined for a particular year by the Minister of Industry will be published in the
Canada Gazette6 and posted on the Bureau’s website.
Based on the transaction structure, step 3 will be satisfied where:
i. Asset Acquisition: The aggregate value of the assets in Canada or the an-
nual gross revenues from sales in or from Canada generated from those assets
would exceed the TSTA (transaction-size threshold amount)
ii. Voting Share Acquisition7:
a. the aggregate value of the assets in Canada of the acquired corporation,
or the annual gross revenues from sales in or from Canada generated
Guidelines
from those assets, would exceed the TSTA (transaction-size threshold
amount); and
b. if it is an acquisition of voting shares that are:
a. publicly traded, the proposed acquisition must result in the acquir-
ing party, together with its affiliates, holding in excess of 20% of the
target corporation’s voting interests, unless the acquiring party al-
ready owns more than a 20% voting interest, in which case the pro-
posed acquisition must result in the acquiring party holding in ex-
cess of 50% of the target corporation’s voting interests; or
b. not publicly traded, the proposed acquisition must result in the
acquiring party, together with its affiliates, holding in excess of 35%
of the target corporation’s voting interests, unless the acquiring
party already owns more than a 35% voting interest, in which case
the proposed acquisition must result in the acquiring party holding
in excess of 50% of the target corporation’s voting interests.
5 The indexing mechanism is set out in subsection 110(8) of the Act. Alternatively, a thresh-
old amount may be prescribed by regulation. If no amount is prescribed or published in a
particular year, the threshold from the previous year remains in effect.
6 See subsection 110(9) of the Act.
7 “Voting share” is defined in subsection 108(1) of the Act. Please also refer to Interpretation
Guideline No. 5 — Subsection 110(3). Acquisitions of Non-Voting Shares and Convertible
Securities.
485
iii. Amalgamation:8
a. the aggregate value of the assets in Canada of the continuing corpora-
tion, or corporations controlled by it, or the annual gross revenues from
sales in or from Canada generated from those assets would exceed the
TSTA (transaction size threshold amount); and
b. each of at least two of the amalgamating corporations, together with its
affiliates, have assets in Canada, or annual gross revenues from sales in,
from or into Canada, that would exceed the TSTA (transaction-size
threshold amount)
iv. Combination: The aggregate value of assets in Canada of the combination
or the annual gross revenues from sales in or from Canada generated from
those assets would exceed the TSTA (transaction-size threshold amount)
v. Acquisition of an Interest in a Combination:
a. the aggregate value of the assets in Canada of the combination, or the
annual gross revenues from sales in or from Canada generated from those
assets, would exceed the TSTA (transaction-size threshold amount); and
b. the acquiring party, together with its affiliates, as a result of the pro-
posed acquisition would be entitled to receive more than 35% of the prof-
its of the combination or of its assets on dissolution, or more than 50%
where the acquiring party’s interest already exceeds 35%.
Step 4: — Exemptions
Where Steps 1 to 3 have been satisfied, the proposed transaction is notifiable unless
there is an applicable exemption. Sections 1119, 11210 and 11311 of the Act set out
certain statutory exemptions, including general exemptions from the requirement to
notify where all parties to a transaction are affiliates12 of each other, or where the
Commissioner has issued an ARC (Advance Ruling Certificates) pursuant to sec-
tion 102 of the Act. Section 15 of the Regulations contains an exemption for asset
securitization transactions, as defined in section 2 of the Regulations.
2.3 — Further acquisition of voting shares or interest in a combination

As noted above, where a person has already exceeded the 20% or 35% threshold
for an acquisition of voting shares, or the 35% threshold for an acquisition of an
interest in a combination, another Notification (as defined below) under section 114
8 For further information on amalgamations, please refer to Interpretation Guideline No.6 —

Section; 110(4). Amalgamations.
9 Please refer to Interpretation Guideline No.7 — Paragraph 111(d). Creditor Acquisitions.
10 Please refer to Interpretation Guideline No.4 — Section 112. Exemption for Combina-
tions that are Joint Ventures.
11 Please refer to Interpretation Guideline No.11 — Corporate Spin Offs.
12 Please refer to Footnote 3.
486
of the Act will generally be required if the same person will exceed the 50% thresh-
old after making a further acquisition of either voting shares or an interest in a
combination. However, where a person intends, at the time of the initial acquisi-
tion, to make such a future acquisition, subsection 115(2) of the Act provides that a
notice of the intended future acquisition may be given along with the initial Notifi-
cation. Where such notice is provided, the parties will not be required to supply a
Notification under section 114 for the future acquisition if two conditions are met:
i. the future acquisition is carried out in accordance with the notice given
under subsection 115(2); and
ii. an additional notice is given in writing to the Commissioner within 21, and
at least seven, days before the future acquisition. Pursuant to subsection
115(4) of the Act, the exemption under subsection 115(3) will not apply to a
future acquisition that is not completed within one year after the date of notice
given under subsection 115(2).
2.4 — Information to be supplied with the notification

Subsection 114(1) of the Act provides that parties to a notifiable proposed transac-
tion are required to notify the Commissioner and supply the prescribed information
set out in section 16 of the Regulations (collectively, the “Notification”).
Guidelines
2.4.1 — Form
The Act does not specify the form in which a Notification must be made; however,
to assist parties in compiling the prescribed information, and to assist the Merger
Notification Unit (the “MNU (Merger Notification Unit)”) in making a timely de-
termination of whether the Notification is complete, the Bureau has developed a
template form. This form sets out the information required to be submitted pursuant
to section 16 of the Regulations, and allows most material to be attached as identi-
fied appendices. Parties that are required to submit a Notification are strongly en-
couraged to use the Bureau’s form
Each party is required to certify under oath or solemn affirmation that the informa-
tion it has supplied is correct and complete in all material respects pursuant to sec-
tion 118 of the Act. A form of certificate for certifying completeness of the Notifi-
cation is also available on the Bureau’s website.
In addition to the prescribed information, the form allows for the submission of
additional information that may be relevant to the Commissioner’s assessment of
the proposed transaction. Parties submitting a Notification are encouraged to volun-
teer such additional information where it could assist the Commissioner in making
a timely decision on whether a transaction should be subject to further proceedings
under the Act. The Competition Bureau Fees and Service Standards Handbook for
Mergers and Merger-Related Matters (the “Handbook”) contains lists of suggested
additional information, to correspond to the complexity level of the transaction. In
addition, parties may optionally choose to provide their Business Numbers when
submitting a Notification.
487
2.4.2 — Information that cannot be supplied

Where information that is required to be supplied is
i. not known,
ii. not reasonably obtainable,
iii. cannot be supplied because of the privilege that exists between lawyers and
notaries and their client, or
iv. cannot be supplied because of a confidentiality requirement establish by
law,
the notifying party may rely on subsection 116(1) and, instead of supplying the
information, inform the Commissioner under oath or solemn affirmation as to pre-
cisely what information has not been supplied and the reason why it has not been
supplied.
2.4.3 — Irrelevant information

Subsection 116(2) of the Act provides that a party submitting a Notification may
withhold information that it would otherwise be required to produce on the grounds
that the information is not relevant toa competition assessment; provided, however,
that the party informs the Commissioner under oath or solemn affirmation of the
basis for its determination of non-relevance and identifies the information that is
not being supplied.
Section 116 affidavits that merely state that information has not been supplied be-
cause it is not relevant are unsatisfactory and will not be accepted by the MNU
(Merger Notification Unit).
In addition, parties relying on subsection 116(2) must provide sufficient informa-
tion about themselves and their affiliates, including names of affiliates and the na-
ture of their businesses, to allow the MNU (Merger Notification Unit) to make a
determination of whether the omitted information is relevant. Parties that fail to do
so assume the risk that their Notification may be considered incomplete, and that
commencement of the waiting period will be delayed until additional information is
received.
2.4.4 — Previously supplied information

Pursuant to subsection 116(2.1) of the Act, where information required under sec-
tion 114 of the Act has been supplied previously to the Commissioner, the notify-
ing party may, instead of supplying that information again, inform the Commis-
sioner under oath or solemn affirmation of the matters in respect of which
information has previously been supplied and when it was supplied. Where the in-
formation was supplied in respect of another matter, parties are requested to pro-
vide the corresponding Bureau file number.
2.4.5 — Omitted information may be required

Pursuant to subsection 116(3) of the Act, where a person chooses not to supply the
Commissioner with information required under section 114 and so informs the
488
Commissioner in accordance with subsection 116(2) (not relevant) or (2.1) (previ-

ously supplied), the Commissioner, or a person authorized by the Commissioner,
may, within seven days after having been so informed, notify that person that the
information is required. In such a case, the person shall supply the Commissioner
with the information and the applicable waiting period will only begin upon receipt
of that information.
2.4.6 — Information requested does not exist

In certain instances, a notifying party may determine that information requested as
part of the Notification does not exist. For example, where a notifying party does
not have any affiliates with significant assets in Canada or significant gross reve-
nues from sales in, from or into Canada, the notifying party should indicate in its
Notification that the information does not exist. Leaving the corresponding area on
the form blank or writing “n/a” is insufficient and may result in delay, as the MNU
(Merger Notification Unit) must contact the notifying party for clarification.
2.5 — Waiting periods

Paragraph 123(1)(a) of the Act provides that parties submitting a Notification under
subsection 114(1) shall not complete the proposed transaction before the expiration
of 30 days after receipt of a complete Notification by the Commissioner. Where
either waiting period set out in subsection 123(1) of the Act ends on a holiday, the
Guidelines
waiting period is extended until the end of the next day that is not a holiday.13
Further, subsection 114(2) provides that the Commissioner may, within 30 days
after receiving a Notification, require the notifying parties to supply additional in-
formation that is relevant to the assessment of the proposed transaction. Pursuant to
paragraph 123(1)(b), the issuance of a Supplementary Information Request (“SIR
(Supplementary Information Request)”) triggers a second 30-day waiting period
during which the proposed transaction cannot be completed. This second30-day
waiting period begins once the parties have provided a complete response14 and
have certified compliance with the SIR (Supplementary Information Request). The
Bureau has issued the Merger Review Process Guidelines, which describe the pro-
cess the Bureau will follow when a decision to issue a SIR (Supplementary Infor-
mation Request) has been made.
Following expiration of the applicable waiting period(s), parties are free to com-
plete the proposed transaction unless they have entered into a timing agreement
with the Bureau that would preclude them from completing the proposed transac-
tion for a certain period of time or, on application by the Commissioner, the Tribu-
nal has issued an interim order preventing completion of the transaction.
13 Please refer to Section 4.2.1 of this Guide for the definition of holiday.
14 Where the Commissioner is of the view that the responses provided are incomplete, the
Commissioner may apply to a court or the Tribunal for an order under section 123.1 of the
Act.
489
In the following three instances, parties may complete their proposed transaction
without waiting the full applicable waiting period set out in subsection 123(1) of
the Act:
i. pursuant to subsection 123(2), the Commissioner, or a person authorized by
the Commissioner, may notify the parties, prior to expiration of the applicable
waiting period, that the Commissioner does not intend, at that time, to make
an application under section 92 of the Act in respect of the proposed transac-
tion. Such a notification to the parties will be in the form of a “No- Action
Letter”;
ii. paragraph 113(b) of the Act provides that the issuance of an ARC (Advance
Ruling Certificates) exempts the transaction from the notifiable transactions
provisions in Part IX of the Act. Thus, where a Notification is filed together
with an ARC (Advance Ruling Certificates) request, the issuance of an ARC
(Advance Ruling Certificates) prior to the expiration of the applicable waiting
period automatically terminates that period; or
iii. where information has been supplied in an ARC (Advance Ruling Certifi-
cates) request, and where that information is substantially similar to the infor-
mation required under subsection 114(1), the Commissioner, or a person au-
thorized by the Commissioner, may, pursuant to paragraph 113(c) of the Act,
waive the notification requirement under subsection 114(1) and, consequently,
the applicable waiting period.
Where parties to a proposed transaction complete, or are likely to complete, a pro-
posed transaction before the end of the applicable waiting period, the Commis-
sioner may apply to the Tribunal for an order under section 123.1 of the Act. Possi-
ble sanctions under section 123.1 include administrative monetary penalties of up
to $10,000 for each day on which the parties have failed to comply with section
123. The Tribunal may also order the parties not to implement the merger, or to
dissolve it in whole or in part.
2.6 — Transactions to which subsection 114(3) of the Act applies

Subsection 114(3) of the Act was added to the notification provisions in 1999 to
ensure that information required from the target of an unsolicited or “hostile” take-
over bid is submitted sufficiently in advance of the expiration of the waiting period.
Such timely filing of the information from all parties to a proposed acquisition as-
sists the Bureau in carrying out its assessment of the transaction as expeditiously as
possible.
In a hostile takeover situation, where the Commissioner receives a Notification
from an acquirer prior to receiving information from the corporation whose shares
are being acquired (the “target”), paragraph 114(3)
a. of the Act requires the Commissioner to notify the target immediately that a
Notification has been received from the acquirer. Paragraph 114(3)
b. of the Act requires the target to supply the prescribed information within 10
days after being so notified by the Commissioner.
490
In cases where subsection 114(3) of the Act applies, subsection 123(3) of the Act
provides that the waiting period is determined without reference to the day on
which the prescribed information is received from the target. In other words, the
initial waiting period begins after the Commissioner has received the Notification
from the acquirer and, where SIR (Supplementary Information Request)s have been
issued, the subsequent waiting period begins after the Commissioner has received
the information requested from the acquirer and the acquirer has certified complete-
ness of its response.
2.7 — When should parties notify?

Parties must ensure that a complete Notification is filed sufficiently in advance of
the proposed transaction’s closing date in order to account for the expiration of the
applicable waiting period(s).Generally, parties are encouraged to contact the Bu-
reau at the earliest stage reasonably possible, and certainly as soon as they have an
agreement or, in the case of a hostile takeover, definite plans.
When determining filing dates for proposed transactions, parties may wish to con-
sider the following factors:
i. While paragraph 123(1)(a) of the Act sets out a minimum 30-day waiting
period, the issuance of a SIR (Supplementary Information Request) pursuant
to paragraph 123(1)(b) triggers a second waiting period during which the pro-
Guidelines
posed transaction cannot be completed. The second waiting period ends 30
days after the parties have provided a complete response and have certified
compliance with the SIR (Supplementary Information Request)
ii. While subsection 123(1) of the Act sets out a minimum time period be-
tween filing and completion, the Act does not provide a maximum time period
for the Bureau to complete its assessment of a proposed transaction. There-
fore, parties should be aware that the statutory waiting periods under subsec-
tion 123(1) may not match the service standard periods set out in the Hand-
book. While parties can legally complete their transaction after the end of the
applicable waiting period, even if the Bureau has not completed its assess-
ment, they do so at their own risk. Section 7 of the Act provides a one- year
period following completion of a transaction during which the Commissioner
may choose to challenge the transaction before the Tribunal.
iii. Where a party files its materials to coincide with the minimum statutory
waiting period and the Commissioner determines that the proposed transaction
raises competition issues, the Commissioner may seek from the Tribunal an
order temporarily preventing completion of the transaction. Accordingly, par-
ties may wish to consider planning their transactions to take into account the
possibility of a more extended review, according to the complexity level of the
transaction15.
15 For more information about complexity definitions and associated service standard peri-
ods, please consult the Handbook.
491
Parties that are interested in having the Bureau commence its review of a proposed
transaction prior to triggering a statutory waiting period are encouraged to contact
the Bureau, and may wish to consider submitting an ARC (Advance Ruling Certifi-
cates) request only or together with a draft Notification that contains the prescribed
information but has not been certified and therefore does not meet the statutory
requirements. This may be useful in particularly complex transactions, where it
would be inherently difficult for the Bureau to complete its review or sufficiently
narrow any anti-competitive concerns within the initial 30-day waiting period. Such
an approach may also be useful where parties are seeking to defer market contacts.
In this situation, the Bureau may exercise its discretion to agree to defer market
contacts, but parties must appreciate that the statutory waiting period and the appli-
cable service standard will not commence until the statutory requirements and the
requirements in the Handbook, are satisfied.
Prior to filing a Notification, parties should be reasonably certain of their intentions
regarding completion of the proposed transaction. Parties who submit a Notifica-
tion and subsequently abandon the proposed transaction create an unnecessary bur-
den for themselves and for the Bureau, and they are not likely to be entitled to a
refund of the fee, except in very limited circumstances. For more information about
the Bureau’s refund policy, please consult the Handbook.
2.8 — Failure to notify

Parties that complete a notifiable transaction without submitting a Notification
under subsection 114(1) may have committed a criminal offence under subsection
65(2) of the Act, and may be liable to a maximum fine of $50,000. In addition,
parties may have contravened section 123, which prohibits completing a transaction
prior to expiry of the applicable waiting period, and may be subject to an order
under section 123.1 of the Act.
Where a transaction has been completed in violation of the Act, it is important to
bring the matter to the attention of the MNU (Merger Notification Unit) and submit
a Notification, together with the applicable filing fee16 and an explanation for the
failure to notify, as soon as possible. The explanation should be submitted by an
officer or director of the party, setting out the reasons why the Notification was not
filed in a timely manner, how and when the failure was discovered, and what steps
have been taken to prevent a violation of the Act in the future.
2.9 — Interpretation Guidelines

The Bureau has published a series of Interpretation Guidelines that are intended to
assist parties and their counsel in interpreting and applying the provisions of the
Act relating to notifiable transactions.
16 Where the failure to notify has been discovered in the course of a subsequent transaction
related to the transaction for which there has been a failure to notify, parties will be required
to submit a filing fee in respect of the transaction where the failure to notify occurred, as
well as in respect of the subsequent transaction.
492
The following interpretation guidelines are available on the Bureau’s website:

• Interpretation Guideline No.1 — Section 108. Definition of “operating
business”
• Interpretation Guideline No.2 — Section 114. Number of Notices — Multiple
Step or Continuous Transactions
• Interpretation Guideline No.3 — Paragraph 111(a). Exemptions for Acquisi-
tions in the Ordinary Course of Business
• Interpretation Guideline No.4 — Section 112. Exemption for Combinations
that are Joint Ventures
• Interpretation Guideline No.5 — Subsection 110(3). Acquisitions of Non-Vot-
ing Shares and Convertible Securities
• Interpretation Guideline No.6 — Subsection 110(4). Amalgamation
• Interpretation Guideline No.7 — Paragraph 111(d). Creditor Acquisitions
• Interpretation Guideline No.8 — Section 103. “Substantially Completed” and
Section 119 “Completed”
• Interpretation Guideline No.9 — Shareholder Agreements
Guidelines
• Interpretation Guideline No.10 — Notifiable Transactions Regulations —
Transactions and Events in Section 14
• Interpretation Guideline No.11 — Corporate Spin-Offs
3. — Advance Ruling Certificates

3.1 — Overview
Parties to a proposed transaction may apply for an ARC (Advance Ruling Certifi-
cates) in lieu of, or in addition to, submitting a Notification. Pursuant to section 102
of the Act, where the Commissioner is satisfied by a party or parties to a proposed
transaction that there are insufficient grounds to apply to the Tribunal for a reme-
dial order under section 92, the Commissioner may issue an ARC (Advance Ruling
Certificates)17. The issuance of an ARC (Advance Ruling Certificates) is discre-
tionary; however, an ARC (Advance Ruling Certificates) cannot be issued for a
transaction that has been completed. Where an ARC (Advance Ruling Certificates)
is issued, paragraph 113(b) of the Act exempts the named transaction from the noti-
fication provisions of Part IX.
Under section 103 of the Act, where the Commissioner issues an ARC (Advance
Ruling Certificates) and where the proposed transaction to which the ARC (Ad-
17 Where parties to a transaction require approval from agencies other than the Bureau prior
to closing their transaction, the issuance of an ARC (Advance Ruling Certificates) does not
derogate from the need to obtain these other approvals.
493
vance Ruling Certificates) relates is substantially completed within one year after
the ARC (Advance Ruling Certificates) is issued, the Commissioner cannot apply
to the Tribunal solely on the basis of information that is the same or substantially
the same as the information upon which issuance of the ARC (Advance Ruling
Certificates) was based; however, where the Commissioner receives additional in-
formation that differs substantively from the basis on which the ARC (Advance
Ruling Certificates) was issued, the Commissioner may apply to the Tribunal for an
order under section 92 of the Act. Thus, it is critical that parties provide full disclo-
sure of all information relevant to the proposed transaction and its effect on compe-
tition at the time an ARC (Advance Ruling Certificates) is requested.
A request for, or issuance of, an ARC (Advance Ruling Certificates) will not pre-
vent an inquiry undersection 10 of the Act that the Commissioner may cause to be
made in respect of any other provision of the Act. Where an ARC (Advance Ruling
Certificates) is denied, a No-Action Letter may be issued by the Commissioner, or
a person authorized by the Commissioner, indicating that the Commissioner does
not, at that time, intend to make an application under section 92 in respect of the
proposed transaction.
3.2 — Factors relevant to the consideration of an ARC (Advance Ruling

Certificates) request
Factors to be considered by the Bureau in assessing an ARC (Advance Ruling Cer-
tificates) request include, but are not limited to, those set out in sections 93 to 96 of
the Act. The Merger Enforcement Guidelines, which are available on the Bureau’s
website, provide general guidance on the Bureau’s analytical approach to merger
review. They describe, to the extent possible given the wide variety off actual cir-
cumstances, how the Bureau will conduct its analysis of merger transactions.
3.3 — Information to be submitted with an ARC (Advance Ruling

Unlike the notification provisions in Part IX of the Act, the Act does not stipulate
the information that must be supplied to the Commissioner in support of an ARC
(Advance Ruling Certificates) request. Given that the decision to issue an ARC
(Advance Ruling Certificates) will be based largely on information received from
the party or parties requesting the ARC (Advance Ruling Certificates), parties
should supply the Commissioner with all information relevant to the proposed
merger and its effect on competition.
An ARC (Advance Ruling Certificates) request in respect of a non-complex trans-
action with no or minimal overlap requires significantly less information than one
relating to a non-complex transaction with moderate overlap. Where moderate
overlap exists, the information provided should be similar to the information re-
quirements under section 16 of the Regulations18. In addition, the parties should
18 For further information about the information requirements for non-complex transactions
with no or minimal overlap or moderate overlap, please refer to the Handbook.
494
focus on the matters listed in section 93 of the Act. The submission of relevant
market share information and any related industry studies may also assist in satisfy-
ing the Commissioner that there is no competition issue and that an ARC (Advance
Ruling Certificates) should be issued. Parties requesting an ARC (Advance Ruling
Certificates) should suggest the wording for a “Re:” line that adequately identifies
the transaction and could be used on the ARC (Advance Ruling Certificates). Par-
ties may also optionally choose to provide their Business Numbers when submit-
ting an ARC request.
Where the information supplied with an ARC (Advance Ruling Certificates) re-
quest is substantially similar to the information required under subsection 114(1) of
the Act, the Commissioner may pursuant to paragraph 113(c) of the Act, waive the
requirement to file a notice and supply information under subsection 114(1). Thus,
where the possibility exists that an ARC (Advance Ruling Certificates) request
made in relation to a notifiable transaction could be rejected, parties may also wish
to submit a Notification in order to commence the statutory waiting period. The
Commissioner is likely to waive notification where the examination of the pro-
posed transaction has been completed and additional information is not required.
3.4 — When to request an ARC (Advance Ruling Certificates)

Given that an ARC (Advance Ruling Certificates) is available only for proposed
transactions, an ARC (Advance Ruling Certificates) request should be made as
Guidelines
soon as reasonably practicable to ensure that the Bureau has sufficient time to com-
plete its review, having regard to the Bureau’s service standards. A prompt request
will enable the parties to respond to any concerns or questions the Commissioner
may have so that an ARC (Advance Ruling Certificates) or No-Action Letter
maybe issued before the transaction is scheduled to be completed. The Commis-
sioner is obliged under subsection 102(2) of the Act to consider the matter expedi-
tiously. With the full assistance of the parties, the Commissioner is generally able
to issue the ARC (Advance Ruling Certificates) or No-Action Letter in a timely
fashion.
Where a proposed transaction is not notifiable, and parties wish to receive written
confirmation that the Commissioner will take no further action in the matter, they
should submit an ARC (Advance Ruling Certificates) request along with the appro-
priate fee. Where an ARC (Advance Ruling Certificates) is denied, a No-Action
Letter may be issued by the Commissioner, or a person authorized by the Commis-
sioner, indicating that the Commissioner does not, at that time, intend to make an
application under section 92 in respect of the proposed transaction.
4. — Procedural matters
4.1 — Merger Notification Unit
The MNU (Merger Notification Unit) is responsible for the receipt and initial
processing of Notifications and ARC (Advance Ruling Certificates) requests, as
well as requests for written opinions under section 124.1 of the Act relating to No-
tifiable Transactions. The MNU (Merger Notification Unit) also handles other is-
495
sues regarding the application and interpretation of Part IX of the Act, filing proce-
dures and the notification form, and will provide non-binding verbal assistance in
this regard. Where parties are uncertain about whether a proposed transaction is
notifiable, whether an exemption is applicable, or the type of information that must
be provided to the Bureau, parties are encouraged to contact the MNU (Merger
Notification Unit) for guidance. This informal advice is not binding on the Com-
missioner, but is provided to facilitate compliance with the law. Parties involved in
matters that raise complicated fact scenarios or legal issues are encouraged to seek
private legal counsel.
Where a question relating to Part IX of the Act is detailed and complex in nature, it
may be preferable for parties to submit their question in writing and to request a
written opinion pursuant to section 124.1 of the Act, subject to a fee19. Such writ-
ten opinions are binding on the Commissioner and remain binding as long as the
material facts on which the opinion was based remain substantially unchanged and
the transaction is carried out substantially as proposed.
The MNU (Merger Notification Unit) can be contacted at:
Merger Notification Unit
Mergers Branch, Competition Bureau
Telephone: 819-953-4297
Toll-free: 1-800-348-5358
Fax: 819-994-0998
E-mail: ic.avisdefusionmergernotification.ic@canada.ca
4.2 — Submission of a notification or ARC (Advance Ruling

4.2.1 — Definitions
For the purpose of this Guide, the following definitions shall apply:
i. “business day” means any day that is not a holiday;
ii. “business hours” means the hours from 9:00 a.m. to 5:00 p.m. Eastern Time
on business days; and
iii. “holiday” means any of the following days: Saturday, Sunday, New Year’s
Day, Good Friday, Easter Monday, Victoria Day, Quebec National Holiday
(June 24), Canada Day, Labour Day, Thanksgiving, Remembrance Day,
Christmas Day and Boxing Day. Furthermore, if New Year’s Day, June 24or
Canada Day fall on a Sunday, the following Monday is considered to be a
holiday.
19 For further information regarding written opinions relating to Part IX of the Act, please
refer to the Handbook.
496
4.2.2 — Submitting a notification and/or ARC (Advance Ruling Certificates)

request
Notifications and ARC (Advance Ruling Certificates) requests may be submitted in
paper form or electronically to the MNU (Merger Notification Unit) during busi-
ness hours. Notifications and ARC (Advance Ruling Certificates) requests may be
sent to the MNU (Merger Notification Unit) in paper copy or electronically, and
shall be deemed to be received when delivery is effected to the Bureau Mail Room
or the Bureau Mail Server in Gatineau, Quebec during business hours. ARC (Ad-
vance Ruling Certificates) requests that are not voluminous may also be sent by
facsimile, and will be deemed to be received when transmission is successfully ef-
fected to the MNU (Merger Notification Unit) during business hours. Any Notifica-
tion or ARC (Advance Ruling Certificates) request received after 5:00 p.m. Eastern
Time on a business day, or at any time on a holiday, shall be deemed received by
the Commissioner on the next business day20.
A sample cover letter setting out information that is helpful to the MNU (Merger
Notification Unit) when submitting a Notification or ARC (Advance Ruling Certif-
icates) request is attached at Appendix “A”.
4.2.2.1 — Paper Copy Notifications and ARC (Advance Ruling Certificates)

Requests
Paper copy Notifications and ARC (Advance Ruling Certificates) requests should
Guidelines
be sent to:
Commissioner of Competition
c/o (care of) Merger Notification Unit
Mergers Branch, Competition Bureau
50 Victoria Street
Gatineau, Quebec K1A 0C9
Parties are only required to submit one copy of a Notification or ARC (Advance
Ruling Certificates) request.
4.2.2.2 — Electronic Notifications and ARC (Advance Ruling Certificates)

Requests
Electronic Notifications and ARC (Advance Ruling Certificates) requests should be
sent to the following email address:
ic.avisdefusionmergernotification.ic@canada.ca
It is not necessary to send a paper copy of a Notification or ARC (Advance Ruling
Certificates) request that has been submitted electronically. However, in respect of
20 If a Notification or ARC request is received by the Bureau Mail Server between 5:00 pm
and midnight on a business day, but it can be demonstrated that it was sent before 4:30 p.m.
on that day, it will be deemed received by the Commissioner on that day.(Advance Ruling
Certificates)
497
Notifications, the original affidavits required pursuant to section 118 of the Act
(and section 116 if applicable) must be received by the MNU (Merger Notification
Unit) within 48 hours of receipt of the electronic Notification.
Notifications and ARC (Advance Ruling Certificates) requests submitted electroni-
cally must comply with the following format and size requirements:
a. The maximum size limit is 25 megabytes per individual email. If a Notifica-
tion or ARC (Advance Ruling Certificates) request is greater than the maxi-
mum size, it can be submittedthrough a series of emails. Please indicate the
total number of emails that comprise the Notification or ARC (Advance Rul-
ing Certificates) request.
b. Acceptable File Formats:
• Adobe Acrobat PDF (Portable Document Format) format is preferred;
• word processing files shall be in either MS (Microsoft) Word or
WordPerfect;
• spreadsheets shall be in either MS (Microsoft) Excel format or Lotus 123,
in a configuration that is readily printable; and
• presentations shall be in either MS (Microsoft) PowerPoint or Lotus
Freelance Graphics.
4.2.2.3 — Facsimile transmission of ARC (Advance Ruling Certificates)

requests
In addition, where an ARC (Advance Ruling Certificates) request is not volumi-
nous, it may be faxed to the MNU (Merger Notification Unit) at 819-994-0998
during business hours. Please send voluminous documents by courier or electroni-
cally and avoid using fax transmission. If the document must be faxed owing to
timing concerns, please inform the MNU (Merger Notification Unit) in advance.
4.2.2.4 — Notification may be Submitted by One Party or Multiple Parties

Subsection 114(4) of the Act allows one party to assemble the information of all
parties and submit a Notification jointly and on behalf of all parties. Alternatively,
each party can submit a portion of the Notification. In this case, the Notification
will be considered complete only when the prescribed information as set out in
section 16 of the Regulations has been received from all parties21. Regardless of
whether a single submission is made or each party submits its portion of the Notifi-
cation, each party must certify under oath or solemn affirmation that the informa-
tion it has supplied is correct and complete in all material respects.
Where various parties submit a portion of the Notification, such parties must ensure
that at least one party provides the basic information applicable to the proposed
transaction (e.g. (for example) the transaction description) and that each portion of
21 The one exception is in the case of a hostile acquisition of voting shares, where subsection
114(3) of the Act applies.
498
the Notification is received by the Bureau at approximately the same time, with a
cover letter identifying the other parties that will be filing, who will be submitting
the fee, and when the Bureau can expect to receive these items.
4.2.3 — Fees
Notifications and ARC (Advance Ruling Certificates) requests must be submitted
with the applicable fee. For information about the Bureau’s fees please refer to the
Handbook, which is available on the Bureau’s website.
4.2.4 — Receipt and acknowledgment of notifications and ARC (Advance

Ruling Certificates) requests
The MNU (Merger Notification Unit) processes all Notifications and ARC (Ad-
vance Ruling Certificates) requests received by the Bureau, including confirming to
the parties receipt of a submission, reviewing Notifications for completeness, re-
viewing ARC (Advance Ruling Certificates) requests to ensure sufficient informa-
tion has been provided for the Bureau to commence its review, and assigning a
matter number.
Parties submitting a Notification or ARC (Advance Ruling Certificates) request can
expect to receive the following correspondence from the MNU (Merger Notifica-
tion Unit):
Guidelines
1. where a submission is made electronically, a reply email confirming receipt;
2. a formal acknowledgment confirming receipt of the Notification or ARC
(Advance Ruling Certificates) request;
3. formal confirmation that a Notification is complete, indicating start and end
dates of the initial statutory waiting period or, in respect of an ARC (Advance
Ruling Certificates) request, confirmation that the Bureau has received suffi-
cient information to commence its review; and
4. an official receipt for the payment of the filing fee.
If a Notification or ARC (Advance Ruling Certificates) request is considered in-
complete or deficient, the MNU (Merger Notification Unit) will contact the appro-
priate party to determine how to remedy the situation.
Following its review of a Notification and/or ARC (Advance Ruling Certificates)
request, the MNU (Merger Notification Unit) transfers the file to the case officer(s)
responsible for the merger assessment, who will determine the complexity level of
the transaction for service standard purposes.
If the Bureau’s assessment of the proposed transaction has not been completed by
the end of the waiting period and a SIR (Supplementary Information Request) has
not been issued under subsection 114(2) of the Act, the MNU (Merger Notification
Unit) will send the notifying parties a letter on the last day of the waiting period,
indicating that the waiting period ends on that date and that the assessment is
incomplete.
499
4.2.5 — Withdrawing and resubmitting a notification

Parties seeking to withdraw a Notification must advise the MNU (Merger Notifica-
tion Unit), in writing, of their desire to withdraw the Notification. If a Notification
is withdrawn more than two business days after it was initially received by the
Bureau, and the parties thereafter resubmit a Notification(“Subsequent Notifica-
tion”) under subsection 114(1) of the Act in respect of the same proposed transac-
tion, no fee will be required for the Subsequent Notification if the following condi-
tions are met:
i. the Subsequent Notification, specifically as it relates to the prescribed infor-
mation pursuant to clause 16(1)(c)(iv)(A) and paragraph 16(1)(d) of the Regu-
lations, is current to the date it is received by the Bureau;22
ii. the Subsequent Notification is certified pursuant to section 118 of the Act;
iii. the Subsequent Notification is received by the Bureau within five business
days of the initial notification having been withdrawn;
iv. there has been no material change in respect of the proposed transaction;
and
v. it is the first Subsequent Notification.
If any one or more of these conditions are not met, the Subsequent Notification will
be considered afresh notification and will be subject to the applicable fee and noti-
fication requirements.
4.2.6 — Foreign language documents

The two official languages of Canada are English and French, and the Bureau ac-
cepts Notifications and ARC (Advance Ruling Certificates) requests in either lan-
guage. It is not necessary to translate pre-existing documents for the purpose of a
Notification; however, if, at the time of filing, there is an English or French lan-
guage outline, summary, extract or verbatim translation of any part of a foreign
language document required to be submitted pursuant to subsection 114(1) of the
Act, all such English or French language versions (or one complete translation)
shall be filed along with the foreign language document.
Documentary materials or information in a foreign language required to be submit-
ted in response to a SIR (Supplementary Information Request) pursuant to subsec-
tion 114(2) of the Act shall be translated into either English or French. The foreign
language document must be submitted with the English or French translation at-
tached thereto.
4.3 — Submission of responses to voluntary information requests

During the course of its review of a proposed transaction, the Bureau may request
that parties provide additional information on a voluntary basis to assist in complet-
22 All parties, other than a target that is the subject of an unsolicited bid under subsection
114(3) of the Act are required to submit a Subsequent Notification.
500
ing its review. Responses to such requests may be sent to the case officer(s) in
paper form or electronically. Parties intending to submit their response electroni-
cally should contact the case officer in advance.
4.4 — Confidentiality
Pursuant to subsection 29(1) of the Act, information provided voluntarily or pursu-
ant to sections 102 or 114 of the Act is confidential; however, subsection 29(1)
does permit the communication of such information to Canadian law enforcement
agencies or for the purposes of the administration or enforcement of the Act. Sub-
section 29(2) of the Act provides that the confidentiality provisions do not apply in
respect of any information that has been made public.
Further information on the Bureau’s approach with respect to the communication
and use of confidential information obtained in the course of a merger review can
be found in the “Information Bulletin on the Communication of Confidential Infor-
mation under the Competition Act”.
5. — How to contact the Competition Bureau

Anyone wishing to obtain additional information about the Competition Act, the
Consumer Packaging and Labelling Act, the Textile Labelling Act, the Precious
Metals Marking Act or the program of written opinions, or to file a complaint under
Guidelines
any of these acts should contact the Competition Bureau’s Information Centre:
Web site
www.competitionbureau.gc.ca
Information Centre
Competition Bureau
50 Victoria Street
Telephone
Toll-free: 1-800-348-5358
National Capital Region: 819-997-4282
TTY (teletypewriter) (for hearing impaired): 1-866-694-8389
Facsimile
819-997-0324
6. — Appendix “A” Cover letter checklist

Cover letters submitted with Notifications and ARC (Advance Ruling Certificates)
requests assist in processing documents in a timely manner. The MNU (Merger
Notification Unit) requests that the following information be included in the cover
letter.
501
Attention: Merger Notification Unit

Please ensure that all correspondence, including envelopes and courier packages,
clearly indicates that it is to be directed to the attention of the Merger Notification
Unit.
“Re:” Lines and Matter Numbers

The “Re:” line is often used to determine how to identify and capture the file for
correspondence and databank purposes. It is helpful if all parties to a proposed
transaction use the same Re: line, which should clearly indicate who is acquiring
whom or what (e.g. (for example), “Xcorp acquisition of Ycorp” or “Zcorp sale of
receivables to ABC Trust”). In subsequent correspondence, please identify the case
by referring to the matter number provided by the MNU (Merger Notification Unit)
in the acknowledgment letter for each Notification and/or ARC (Advance Ruling
Certificates) request.
What is being Submitted or Requested

Please state clearly on the first page of the cover letter what is being submitted and
what is being requested.
Who Acts for Whom; Who Will be Submitting What

Where a Notification or ARC (Advance Ruling Certificates) request will be submit-
ted in parts at different times or from different sources, each cover letter should
indicate who will be submitting what on behalf of which party, and when any addi-
tional information may be expected and from whom. Please provide names and
phone numbers of contact persons.
Fees and Official Receipts

Please indicate in the cover letter whether the payment will be made by cheque or
wire transfer and, if by cheque, whether the cheque is enclosed and in what amount.
If the cheque is not enclosed, please indicate when the MNU (Merger Notification
Unit) can expect to receive it. Please include the name that should appear on the
official receipt.
Closing Date
Please indicate the date on which the parties are seeking to close the proposed
transaction.
Confidentiality
Please indicate whether the proposed transaction has been made public or when the
parties expect to announce it.
502
Multiple-Step Transactions
If the Notification or ARC (Advance Ruling Certificates) request relates to a pro-
posed transaction with a complex, multiple-step structure, please indicate why the
transaction should require only one notice and, hence, one fee.
Date modified:
2020-04-01
Guidelines
503
PRE-MERGER NOTIFICATION
INTERPRETATION GUIDELINES
Pre-Merger Notification Interpretation Guideline Number 1:

Definition of “Operating Business” (Section 108 of the
Act)*
This Interpretation Guideline is issued by the Commissioner of Competition
(“Commissioner”), who is responsible for the administration and enforcement of
the Competition Act (“Act”). The purpose of this Guideline is to assist parties and
their counsel in interpreting and applying the provisions of the Act relating to no-
tifiable transactions. This Guideline sets out the general approach taken by the
Competition Bureau (“Bureau”) and supersedes all previous statements made by
the Commissioner or other Bureau officials. This Guideline is not intended to be a
binding statement of how discretion will be exercised in a particular situation and
should not be taken as such, nor is it intended to substitute for the advice of legal
Guidelines
counsel to the parties, or to restate the law. Guidance regarding a specific proposed
transaction may be requested from the Merger Notification Unit1.
Definition
Subsection 108(1) of the Act states:
108. (1) “Operating business” means a business undertaking in Canada to which
employees employed in connection with the undertaking ordinarily report for work.
Background
The definition of “operating business” is relevant to the determination of whether a
proposed transaction is subject to notification because the transaction types in sec-
tion 110 of the Act each make reference to an operating business.
* Pre-Merger Notification Interpretation Guideline Number 1: Definition of ‘Operating

Business‘ (Section 108 of the Act), Innovation, Science and Economic Development
Canada, https://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03358.html.
Reproduced with the permission of the Minister of Innovation, Science and Economic
Development, 2020. The content of this publication may be subject to change or may be
1 For further information, please refer to the Procedures Guide for Notifiable Transactions
and Advance Ruling Certificates Under the Competition Act at p.14: http://www.competi-
tionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03302.html.
505
Interpretation Guidelines
Policy
“Business undertaking” is not defined in the Act. The term “business” is defined in
section 2 of the Act. “Business undertaking” is broadly interpreted to capture all
arrangements through which business may be carried on, including non-profit or
charitable undertakings.
Whether a business undertaking is “operating” depends on the nature of the under-
taking under consideration in each case. A company that is engaged in the business
of holding investments, whether passive or otherwise, may be an operating business
if it satisfies the remainder of the definition of that term.
The term “in Canada” requires that there be present in Canada an office or business
location of a business undertaking. A business undertaking which is partly or
predominantly in another jurisdiction may be considered to satisfy the “business
undertaking in Canada” requirement if it has some component or presence in
Canada.
“Employees employed in connection with the undertaking” are not limited to those
persons employed by the operating business itself, but may also include persons
employed in connection with the operating business. Thus, employees of a third
party with a contract for services in connection with a business undertaking would
satisfy this requirement.
“Ordinarily report for work” does not require that an employee reporting be a full-
time employee. The frequency of an employee’s reporting to work in connection
with a particular undertaking and whether the reporting is ordinary may depend on
the nature of the undertaking. For example, if a business undertaking consists of
leasing property and an employee is only required to collect the rent once per
month, that would satisfy the “ordinarily report for work” requirement.
Assets of an Operating Business

Assets of an operating business include all the assets of the operating business.
Accordingly, dormant assets of an operating business, such as a closed (mothbal-
led) plant of a corporation which owns several other operating plants, are consid-
ered assets of the “operating business”.
Defunct Businesses
A defunct business is not an “operating business” under section 108 of the Act. A
business is considered defunct where the business has permanently closed. A busi-
ness which has temporarily closed or suspended its operations is considered an “op-
erating business”. A business is not considered defunct by reason only that its as-
sets have vested in a trustee in bankruptcy pursuant to the Bankruptcy and
Insolvency Act, or that its assets have been placed in receivership. If a trustee or
receiver is carrying on a business undertaking with a view to disposing of the busi-
ness as a going concern or to reorganizing its affairs, the business undertaking may
still be considered an “operating business”. Where the operating business cannot be
either carried on or sold as a going concern, and the trustee or receiver takes steps
506
to liquidate the assets on a piecemeal basis, the undertaking may no longer be an

“operating business”.

Number of Notices — Multiple Step or Continuous
Transactions (Section 114 of the Act)*
Background
Section 114 of the Act places an obligation on parties to a proposed transaction that
Guidelines
exceeds the party-size and transaction-size thresholds to notify the Commissioner
of Competition. Section 110 of the Act indicates the types of transactions subject to
notification and the applicable thresholds.
A separate notice and the corresponding fee are required for each proposed transac-
tion. Most transactions are fairly straightforward in their structure and in that re-
spect raise no particular pre-merger notification concerns. However, some proposed
transactions are structured in a more complex manner and may involve numerous
parties, assets or steps. A series of proposed transactions may raise an issue regard-
ing the actual number of transactions being proposed and, as such, the number of
notices required.
Policy
Depending on the facts of any particular case, a series of proposed transactions may
be regarded as: (i) one continuous, or multiple step, transaction with several steps

507
for which only one notice and fee is required, or (ii) several independent transac-
tions for which several notices and fees may be required.
Generally, every proposed transaction under section 110 of the Act constitutes a
separate proposed transaction for the purposes of notice under section 114 of the
Act. However, two or more proposed transactions under section 110 typically will
be considered one continuous transaction if all steps in the series of proposed trans-
actions constitute a sufficiently connected sequence of events. To demonstrate a
sufficiently connected sequence of events, the legal documents providing for the
events must show clearly, comprehensively and unequivocally that each event in
the series may proceed only if each previous event in the series has been completed
and that the entire series will be completed within one year from the day on which
the information prescribed under section 114 has been supplied. However, where
the series of events cannot be completed within one year, the parties may apply to
the Commissioner for an extension of time under section 119 of the Act. For infor-
mation on extensions of time under section 119, see Interpretation Guideline No.8.
A continuous transaction that has been approved by a judicial or regulatory body,
such as court-approved “plans of arrangement” under applicable corporations legis-
lation, the Companies’ Creditors Arrangement Act, or both, may be considered one
continuous transaction.
Counsel who intend to characterize a series of proposed transactions as a continu-
ous transaction should: (i) ensure that the transaction description in the notice or in
the Advance Ruling Certificate request is as complete and detailed as possible; (ii)
set out the reasons for characterizing the series of proposed transactions as a contin-
uous transaction, and refer to the specific paragraphs in the legal documents sup-
porting the continuous transaction claim; and (iii) include the relevant legal
documents.

Exemptions for Acquisitions in the Ordinary Course of
Business (Paragraph 111(a) of the Act)*

508

Definition
Paragraph 111(a) of the Act provides that the following class of transaction is ex-
empt from the application of Part IX of the Act:
111. (a) an acquisition of real property or goods in the ordinary course of business if
the person or persons who propose to acquire the assets would not, as a result
of the acquisition, hold all or substantially all of the assets of a business or of
an operating segment of a business.
Policy
In determining whether an acquisition of real property or goods is exempt under
paragraph 111(a) of the Act, the first step is to determine whether the proposed
acquiror will, as a result of the acquisition, hold all or substantially all of the assets
of a business or of an operating segment of a business. If the assets being sold
constitute all or substantially all of the assets of a business or of an operating seg-
ment of a business, the exemption in paragraph 111(a) is not available, regardless
Guidelines
of whether the transaction is in the ordinary course of business. If the assets do not
constitute all or substantially all of the assets of a business or of an operating seg-
ment of a business, then the transaction will be exempt if it is in the ordinary course
of business.
In a proposed transaction that includes an acquisition of real property or goods that
is exempt under paragraph 111(a) of the Act, the acquisition of any other assets in
that transaction may be subject to notification under section 114 of the Act as if the
assets were being acquired in a separate transaction.
Step one: — Will the Acquiror, as a Result of the Acquisition, Hold All
or Substantially All of the Assets of a Business or of an Operating
Segment of a Business?
The purpose of the latter part of paragraph 111(a) of the Act is to deny the exemp-
tion if the proposed transaction involves the sale of a group of assets that, when
considered on its own, constitutes all or substantially all of the assets of a business
or an operating segment of a business. Such acquisitions have the potential to con-
centrate productive capacity and thereby diminish competition.
The latter part of paragraph 111(a) of the Act applies to deny the exemption in two
circumstances. The first is where, as a result of the acquisition, the purchaser will
509
acquire all or substantially all of the assets of a business, which could include the
assets of both operating and non-operating businesses. However, given that subsec-
tion 110(2) of the Act provides that Part IX of the Act applies only to an acquisition
of assets of an operating business, the exemption in paragraph 111(a) could only
apply to an acquisition of all or substantially all of the assets of an operating busi-
ness. Consequently, for purposes of paragraph 111(a), the term “business” will be
interpreted to mean “operating business”, as that term is defined in section 108 of
the Act.
The exemption in paragraph 111(a) of the Act does not apply where a purchaser
proposes to acquire only a segment of an operating business and that segment is an
operating segment. An operating business may have operating and non-operating
segments. Each operating business will have at least one segment that is an operat-
ing segment. In addition, an operating business may have other operating segments
and non-operating segments, such as dormant or mothballed facilities. Accordingly,
where an operating business has both one operating segment and one non-operating
segment, the latter part of paragraph 111(a) applies and the exemption is not availa-
ble where the purchaser acquires the operating segment. Similarly, where an oper-
ating business has more than one operating segment, the latter part of paragraph
111(a) applies and the exemption is not available where the purchaser acquires at
least one of the operating segments.
In considering whether a group of assets constitutes an operating business or an
operating segment, the manner in which the vendor organizes or defines the group
of assets is not determinative and, in many cases, will not be relevant. Each group
of assets will be analyzed on its own to determine whether the group constitutes all
or substantially all of an operating business or an operating segment. Each location
of a company’s business may be viewed as an operating business or an operating
segment. Examples of an operating business or an operating segment may include,
but are not limited to, a regional division, a company branch, a retail store or a
factory.
The word “hold” in paragraph 111(a) of the Act is interpreted consistently with that
word as it appears in subparagraph 2(4)(a)(i) of the Act. As a result, an asset may
be held by a person “directly or indirectly, whether through one or more subsidiar-
ies or otherwise, otherwise than by way of security only, by or for the benefit of
that person.” An asset is held directly if the person is the beneficial owner of the
asset. In that circumstance, the asset is held by the person. An asset may be held
indirectly by a person if a subsidiary of that person is the beneficial owner of the
asset. An asset may also be held indirectly by a person that is the beneficial owner
of the asset if legal or registered ownership is held by a third party, such as an agent
or a trustee. In both circumstances, the asset is held for the benefit of the person.
Whether a particular group of assets constitutes “substantially all” of the assets of
an operating business or an operating segment will depend on the circumstances of
each case. Both quantitative and qualitative considerations will be examined. Gen-
erally, where a group of assets is such that the purchaser could reasonably be ex-
pected to carry on an operating business or an operating segment, the “substantially
all” test will have been satisfied.
510
Step two: — Acquisitions of Real Property or Goods in the Ordinary

Course of Business
For purposes of paragraph 111(a) of the Act, an acquisition of real property or
goods is in the ordinary course of business if the acquisition is a routine business
transaction, that is, the transaction is one which firms carry out in the conduct of
business in general. Such a transaction does not include an acquisition of assets
which would transfer, directly or indirectly, production capacity between firms in
the same line or lines of business, unless the seller is replacing the production ca-
pacity provided by the assets being sold.
The following examples of acquisitions of assets that are exempt are not intended
to be exhaustive. There may be other acquisitions of real property or goods that are
in the ordinary course of business and therefore exempt under paragraph 111(a) of
the Act.
One example of an acquisition of goods that is in the ordinary course of business is
an acquisition of new goods. Acquisitions of new goods are routine sales by manu-
facturers, wholesalers or retailers. The term “new” implies that the goods have not
been used to generate income. Acquisitions of new goods normally expand the sup-
ply of products or expand productive capacity and therefore do not tend to lessen
competition.
Another example of an acquisition of goods that is in the ordinary course of busi-
Guidelines
ness is an acquisition of current supplies. The word “current” means that the goods
generally have a useful life of less than one year. However, if the purchaser’s nor-
mal operating cycle is longer than one year, the goods may also have a useful life
that is longer than one year. Current supplies include the following kinds of new
and used goods:
• goods acquired and held solely for the purpose of resale or leasing to an entity
that is not an affiliate of the purchaser (e.g., inventory);
• goods acquired for consumption in the daily conduct of the purchaser’s busi-
ness (e.g., office supplies or maintenance supplies); and
• goods acquired to be incorporated into the purchaser’s final product (e.g., raw
materials and components).
Purchases of current supplies are also routine. Again, acquisitions of current sup-
plies should not in any way diminish the capacity of the selling firm to compete.
One example of an acquisition of real property that is in the ordinary course of
business is an acquisition of new facilities. A new facility is a structure that has not
produced income and was either constructed by the seller for sale or held at all
times by the seller for resale. Like acquisitions of new goods, acquisitions of new
facilities normally expand the supply of real estate products or expand productive
capacity and therefore do not tend to lessen competition.
Another example of an acquisition of real property in the ordinary course of busi-
ness is an acquisition of a used facility from a lessor that has held title to the facility
for financing purposes by a lessee that has had sole and continuous possession of
the facility since it was first built as a new facility.
511
Examples
The examples below are hypothetical and are intended only to illustrate the Bu-
reau’s interpretation of this section as outlined above.
Example 1
A intends to sell to B one of several grocery stores that A owns and operates. The
assets to be sold include the store building and underlying real property, the store’s
inventory and the fixtures and chattels located at the store. Each of A’s stores con-
stitutes an operating business. The assets to be sold constitute all or substantially all
of the assets of that operating business. Accordingly, B’s acquisition of the grocery
store from A does not meet the first test and is not exempt under paragraph 111(a).
It is not necessary to consider the second test of whether the transaction constitutes
an acquisition of real property or goods in the ordinary course of business.
Example 2
A intends to sell to B one of several office buildings that A owns and manages. The
office building is leased to a variety of commercial tenants. The assets to be sold
include the building and underlying real property, A’s interest as landlord under the
leases with the commercial tenants, and the fixtures and chattels located at the of-
fice building. B intends to use the building as its head office. For that purpose,
following the purchase of the office building, B plans to not renew the leases of the
existing tenants upon the expiry of those leases. The office building to be sold con-
stitutes an operating business. The assets to be sold constitute all or substantially all
of the assets of that operating business. Accordingly, B’s acquisition of the office
building from A does not meet the first test and is not exempt under paragraph
111(a). It is not necessary to consider the second test of whether the transaction
constitutes an acquisition of real property or goods in the ordinary course of
business.
Example 3
A and B are two telecom companies. A intends to sell to B 12 fibreoptic strands
which represent half of the strands of a cable. The cable was originally acquired by
A for its own use. The strands to be sold have never been used to generate income.
The 12 fibreoptic strands do not constitute all or substantially all the assets of a
business or of an operating segment of a business. Therefore, the transaction meets
the first test. The assets to be sold were not purchased and held by A at all times for
resale and therefore are not current supplies. While the assets are new given they
have never been used, the transaction is not a routine sale given that the acquisition
of these assets would transfer production capacity between firms in the same line of
business. As a result, it does not meet the second test and is not an acquisition of
goods in the ordinary course of business. The transaction is not exempt under para-
graph 111(a).
512
Example 4
A, a railroad company, intends to purchase a number of used locomotives engines
from B, another railroad company. B does not intend to replace the capacity pro-
vided by the engines to be sold. The engines do not constitute all or substantially all
the assets of a business or of an operating segment of a business. Therefore, the
transaction meets the first test. The purchase of the engines is an acquisition of
goods that transfers production capacity between firms in the same line of business.
As a result, the transaction does not meet the second test as it is not an acquisition
in the ordinary course of business and is not exempt under paragraph 111(a).
Example 5
A, a car manufacturer, intends to acquire more than $35 million worth of steel from
a steel producer to be used in the car manufacturing process. The transaction meets
the first test as the steel being acquired does not constitute all or substantially all
the assets of a business or of an operating segment of a business. The acquisition
also meets the second test as it is a routine acquisition of raw material to be incor-
porated into the purchaser’s final product and, accordingly, meets the definition of
current supplies. The transaction is exempt under paragraph 111(a).
Example 6
Guidelines
A is a brewery and B is a soft drink bottler. A intends to acquire two labelling
machines and one bottle filler from B. The equipment being sold is not used by B.
The assets being acquired are not all or substantially all of the assets of a business
or of an operating segment of a business. Therefore it would meet the first test. The
acquisition of these assets is not a transfer between firms with the same line of
business. The acquisition is an acquisition in the ordinary course of business which
meets the second test. The transaction is exempt under paragraph 111(a).

Exemption for Combinations that are Joint Ventures
(Section 112 of the Act)*

513

Policy
The exemption under section 112 of the Act does not apply to joint ventures in
corporate form. For a joint venture to be exempt under section 112 of the Act, the
combination is required to be an unincorporated entity.
Subsection 110(1) of the Act provides that Part IX of the Act applies only to pro-
posed transactions described in section 110 of the Act. Accordingly, combinations
for purposes of prenotification are limited to those found in subsection 110(5) of
the Act. That provision refers to proposed combinations of two or more persons
intended to carry on business “otherwise than through a corporation”. Therefore,
when interpreting section 112 of the Act, the words “otherwise than through a cor-
poration” should be read in because “combination” in subsection 110(5) excludes
corporate entities; the meaning of “combination” in reference to prenotification is
restricted to its use in subsection 110(5); section 112 is an exception to subsection
110(5); and section 112 does not explicitly include corporate entities.

Acquisitions of Non-Voting Shares and Convertible
Securities (Subsection 110(3) of the Act)*
514
Background
Subsection 110(3) of the Act sets out the transaction-size thresholds for the acquisi-
tion of voting shares of a corporation.
Policy
The phrase “person or persons”, found in subparagraphs 110(3)(b)(i) and
110(3)(b)(ii) of the Act, should be interpreted in the same manner as the expression
“person or persons together with their affiliates”, found in paragraph 110(3)(b).
Different thresholds exist under paragraph 110(3)(b) of the Act according to
whether the voting shares of a corporation are publicly traded. Publicly-traded vot-
ing shares include shares which have been listed and posted for trading on any
stock exchange in Canada recognized as such by the appropriate provincial securi-
ties authority, or which are traded in any other market, including over-the-counter
markets, if the prices at which they have been traded are regularly published in a
bona fide news, business or financial publication of general and regular circulation.
Acquisitions of non-voting shares of a corporation are not notifiable under Part IX
of the Act. Thus, where non-voting shares are being acquired from a third party
Guidelines
holding them and reflecting them on its balance sheet as assets, the acquisition is
not notifiable.
In the case of an acquisition of convertible securities, such as convertible deben-
tures, convertible non-voting shares, options, warrants and rights, notice of the ac-
quisition need only be given when the securities will be converted to voting shares
and if the party-size and transaction-size thresholds have been exceeded.

Amalgamation (Subsections 110(4) and 110(4.1) of the
Act)*
515
Background
Subsection 110(4) of the Act provides that, subject to subsection 110(4.1), notifica-
tion is required for a proposed amalgamation of two or more corporations where:
(a) the aggregate value of the assets in Canada of the continuing corporation, other
than assets that are shares of that corporation, exceed $70 million or such other
amount as prescribed pursuant to subsection 110(8)7; or (b) the gross revenues
from sales in or from Canada generated from the assets in (a) exceed $70 million or
such other amount as prescribed pursuant to subsection 110(8).
Subsection 110(4.1) provides that no notification is required for a proposed amal-
gamation of two or more corporations, unless each of at least two of the amalga-
mating corporations, together with its affiliates8, has: (a) assets in Canada that ex-
ceed $70 million or such other amount as prescribed pursuant to subsection 110(8);
or (b) gross revenues from sales in, from or into Canada that exceed $70 million or
such other amount as prescribed pursuant to subsection 110(8).
This additional requirement provides that each of at least two of the amalgamating
corporations must be large enough to meet a required financial threshold on its
own. In other words, a corporation (including its affiliates) with less than $70 mil-
lion in assets and revenues will not trigger a notification requirement merely by
merging with a larger corporation. The fact that the assets in Canada and revenues
in, from or into Canada of each amalgamating party’s affiliates are included in the
subsection 110(4.1) calculation ensures that an acquirer cannot avoid a notification
7 The 2009 amendments to the Competition Act increased the transaction-size threshold to
$70 million and introduced an indexing mechanism for subsequent years based on the
change in the level of Nominal Gross Domestic Product at market prices. The indexing
mechanism is defined at subsection 110(8) of the Act. Pursuant to subsection 110(9) of the
Act, the amount determined for a particular year shall be published in the Canada Gazette
and that amount will also be posted on the Bureau web site. Alternatively, a threshold
amount may be prescribed by regulation. If no amount is prescribed or published in a partic-
ular year, the previous year’s threshold remains in effect.
8 For a definition of affiliate, see subsection 2(2) of the Act.
516
requirement by incorporating a shell subsidiary and amalgamating the subsidiary

with a large target corporation, instead of acquiring the shares of the target.
Policy
While the Act does not provide a definition of amalgamation, the process of amal-
gamation refers to the union of two or more corporations, whereby they become
one corporation. For most federally incorporated businesses, sections 181 to 186 of
the Canada Business Corporations Act set out the procedure for amalgamation. For
provincially incorporated businesses, the applicable corporations legislation should
be consulted.
An amalgamation pursuant to valid legislation is considered an amalgamation for
purposes of subsection 110(4) of the Act, whether the amalgamation occurs under
federal or provincial legislation or under the laws of a foreign jurisdiction. Care
should be exercised not to confuse amalgamations with share acquisitions, which
are considered under subsection 110(3) of the Act.
A triangular merger, also known as a Delaware merger, where the target corpora-
tion is absorbed into the acquiring corporation’s subsidiary, with the target’s share-
holders receiving shares of the parent corporation, is considered an amalgamation
for purposes of subsection 110(4) of the Act. A reverse triangular merger, or re-
verse Delaware merger, where the acquiring corporation’s subsidiary is absorbed
Guidelines
into the target corporation, is also considered an amalgamation for purposes of sub-
section 110(4) of the Act.
Examples
reau’s interpretation, as outlined above. It is assumed for the purposes of these ex-
amples that the threshold under subsections 110(4) and 110(4.1) of the Act is $70
million.
Example 1
Parties A, B and C, three Canadian corporations, propose to amalgamate. Party A
has assets in Canada of $500 million and gross revenues from sales in, from or into
Canada of $900 million. Parties B and C each have assets in Canada of $40 million
and gross revenues from sales in, from or into Canada of $60 million. A, B and C
have no affiliates.
In this scenario, the section 109 and subsection 110(4) thresholds are exceeded.
However, the subsection 110(4.1) threshold is not exceeded, as only one of the
amalgamating parties, i.e. Party A, has assets in Canada or gross revenues from
sales in, from or into Canada that exceed $70 million. Consequently, the proposed
transaction is not notifiable.
If B or C had assets in Canada or gross revenues from sales in, from or into Canada
in excess of $70 million, then the proposed transaction would be notifiable.
517
Example 2
Two corporations, Acorp and Bcorp, enter into an agreement whereby Bcorp will
amalgamate with Asub, a wholly-owned subsidiary of Acorp, which was incorpo-
rated for the sole purpose of effecting the proposed transaction. Asub has no assets
or revenues. Acorp has assets in Canada of $350 million. Bcorp has assets in Can-
ada of $75 million.
For the purposes of determining whether the party-size threshold has been met,
Acorp and Bcorp, together, have a total of $425 million in assets in Canada. Ac-
cordingly, the section 109 threshold is met since the combined assets for both par-
ties are greater than $400 million.
For the purposes of determining the transaction-size threshold under subsection
110(4), the continuing corporation that will result from the amalgamation will have
assets of $75 million, therefore the $70 million threshold under subsection 110(4) is
exceeded.
Finally, the subsection 110(4.1) threshold is also exceeded, as each of the two par-
ties to the amalgamation, together with their respective affiliates, have assets in
Canada that exceed $70 million. Bcorp has $75 million of assets in Canada and
Asub, together with its parent Acorp, has $350 million of assets in Canada.
Example 3
Acorp is a publicly traded corporation that has $350 million of assets in Canada.
Acorp has a shell subsidiary Asub that has no assets or revenues. Holdcorp’s only
assets are the shares of Bcorp, which has assets in Canada of $65 million and gross
revenues from sales in or from Canada of $60 million. Asub and Bcorp amalgamate
and, in consideration, Holdcorp receives 25% of the shares of Acorp.
In this case, the $70 million threshold under subsection 110(4) is not exceeded;
therefore, the transaction is not notifiable under subsection 110(4). However, the
acquisition of 25% of the shares of Acorp by Holdcorp is notifiable under subsec-
tion 110(3).

Creditor Acquisitions (Paragraph 111(d) of the Act)*
(”Commissioner”), who is responsible for the administration and enforcement of
the Competition Act (”Act”). The purpose of this Guideline is to assist parties and

518
Competition Bureau (”Bureau”) and supersedes all previous statements made by
transaction may be requested from the Merger Notification Unit.9
Background
Creditor acquisitions sometimes involve businesses that are either defunct, tempo-
rarily closed, or whose operations are suspended. Such transactions may require an
assessment of whether there is an acquisition of an “operating business” as defined
in subsection 108(1) of the Act.
Paragraph 111(d) of the Act provides that the following class of transaction is ex-
111. (d) an acquisition of collateral or receivables, or an acquisition resulting from a
foreclosure or default or forming part of a debt work-out, made by a creditor in
or pursuant to a credit transaction entered into in good faith in the ordinary
course of business.
The acquisition by a creditor or its agents of the property of a debtor is, in certain
Guidelines
circumstances, considered a class of transaction that is exempt from the application
of Part IX of the Act. The subsequent disposition of the acquired collateral by the
creditor or its agent may also be exempt under paragraph 111(d) of the Act, de-
pending on the circumstances.
Policy
In insolvency proceedings, trustees and receivers are officers of the court that ad-
minister the insolvency process. Hence, the vesting of a debtor’s assets in the trus-
tee or receiver and their corresponding acquisition of control and possession of the
debtor’s assets are exempt from the application of Part IX of the Act. However, the
subsequent sale of a debtor’s assets by a trustee or receiver to a third party may be
notifiable, depending on the nature of the debtor’s assets and whether they relate to
an operating business.
The vesting of a debtor’s assets in a trustee or receiver is not by itself sufficient
reason to consider an operating business defunct. If the trustee or receiver is carry-
ing on the business with a view to disposing of it as a going concern, or to reorga-
nizing its affairs, the undertaking may still be considered an “operating business”.
Where an operating business is incapable of being carried on or of being sold as a
going concern and the trustee or receiver takes steps to liquidate the assets on a
and Advance Ruling Certificates Under the Competition Act.
519
piecemeal basis, the undertaking may no longer be an “operating business” as de-

fined in the Act.10
The paragraph 111(d) exemption may extend to acquisitions following the transfer
of a creditor’s interest (e.g. on secondary markets), provided the acquisition is pur-
suant to a credit transaction entered into in good faith in the ordinary course of
business. For example, where a creditor transfers its interest to another creditor that
subsequently makes an acquisition pursuant to a foreclosure or default or as part of
a debt work-out,11 the subsequent acquisition is exempt under paragraph 111(d) of
the Act if the transfer was made prior to:
i. any filing or declaration in respect of the bankruptcy, insolvency or receiver-
ship of the debtor, or the debt work-out; and
ii. the acquirer having knowledge of the impending bankruptcy, insolvency,
receivership, or debt work-out.
An acquisition following a transfer that occurs after an announcement or filing for
bankruptcy would not be exempt under paragraph 111(d) of the Act because it
would not be deemed a credit transaction in the ordinary course of business.
For further information, please refer to the Pre-Merger Notification Interpretation
Guideline Number 1: Definition of “Operating Business” (Section 108 of the Act).

“Substantially Completed” and “Completed” (Sections 103
and 119 of the Act)*
10 For further information, please refer to the Pre-Merger Notification Interpretation Guide-
line Number 1: Definition of “Operating Business” (Section 108 of the Act).
11 In paragraph 111(d) of the Act, “debt work-out” includes plans of arrangement under the
Companies’ Creditors Arrangement Act and proposals under Part III of the Bankruptcy and
Insolvency Act.
520
Background
Under Part VIII of the Act, where the Commissioner is satisfied by a party or par-
ties to a proposed transaction that the Commissioner would not have sufficient
grounds on which to apply to the Competition Tribunal under section 92 of the Act,
the Commissioner may, pursuant to section 102 of the Act, issue an Advance Rul-
ing Certificate (“ARC”). Section 103 of the Act provides that the Commissioner
shall not apply to the Tribunal under section 92 if the transaction to which the ARC
relates is substantially completed within one year after the certificate is issued and
if the set of facts on which the certificate is issued remains substantially the same.
Section 119 of the Act provides that a notice under section 114 of the Act is valid
for one year from the date on which the notice is given and the prescribed informa-
tion is supplied to the Commissioner. Where a proposed transaction is not com-
pleted within one year or such longer period as the Commissioner may specify in
any particular case, another notice will be required if the parties wish to complete
the proposed transaction.
Policy
Guidelines
For purposes of section 103 of the Act, a transaction is “substantially completed”
when: (i) in an acquisition of assets, title to all of the assets has passed from the
vendor(s) to the purchaser(s); (ii) in an acquisition of shares, the shares have been
transferred from the vendor(s) to the purchaser(s); (iii) in an amalgamation, the
amalgamation has become effective according to the statute under which the amal-
gamation was completed; (iv) in a combination, title to all of the assets to be con-
tributed to the combination has passed from the contributor(s) to the combination;
and (v) in an aquisition of an interest in a combination, title to that interest has
passed from the vendor(s) to the purchaser(s). After closing there may remain some
ancillary details of a minor or routine nature to be completed, such as filings for
registrations. Once they have been attended to, the transaction will be finally
completed.
Under section 119 of the Act, the Commissioner may choose to extend the one-year
period for completing a transaction. Any extensions granted will be for a limited
range of circumstances and for a limited period of time. For example, an extension
of up to several months may be granted where unforeseen reasons cause a delay, or
where the proposed transaction requires the regulatory approval of either adminis-
trative tribunals or other agencies and it is not reasonably possible to obtain the
approvals within the one-year period. Requests for extension of the one-year period
521
should be made as soon as the parties become aware that there may be some diffi-
culty in closing the transaction within the statutory period.

Shareholder Agreements*
Background
Paragraph 2(4)(a) of the Act provides that a corporation is controlled by a person if
that person holds more than 50 per cent of the votes that may be cast to elect direc-
tors of the corporation. Shareholders of a corporation may enter into agreements,
among themselves or with other parties, whereby voting interests may be acquired,
transferred or suspended, either on a temporary or permanent basis. These voting
interests found in shareholder agreements may include rights to elect directors. The
question of the potential impact of shareholder agreements may arise in the context
of threshold calculations for purposes of section 109 or subsection 110(3) of the
Act.
Policy
Arrangements between parties to a shareholder agreement regarding the number of
votes to be cast for the election of directors will not alter the basis for determining
whether a person controls a corporation for purposes of paragraph 2(4)(a) of the
Act and, hence, whether two corporations are affiliated under subsection 2(2) of the
Act. Accordingly, when interpreting “control” in paragraph 2(4)(a) in the context of

522
a shareholder agreement, it is the number of voting shares owned by each share-

holder which is relevant, not the number of votes for the election of directors which
each shareholder will exercise pursuant to the shareholder agreement.
Example 1 — Affiliation Determination

A corporation (Acorp) is owned by two corporate shareholders. Forty per cent of
the voting shares are owned by corporate shareholder B (Bcorp) and 60 per cent by
corporate shareholder C (Ccorp). Bcorp and Ccorp enter into a shareholder agree-
ment whereby Bcorp and Ccorp agree to share on a 50/50 basis the votes for elect-
ing corporate directors. For purposes of paragraph 2(4)(a) of the Act, Ccorp con-
trols Acorp. Accordingly, under subsection 2(3) and paragraph 2(2)(a) of the Act,
Acorp is a subsidiary of, and is therefore affiliated with, Ccorp. Although Ccorp
has entered into a shareholder agreement which grants another shareholder the right
to cast additional votes for the election of directors, Ccorp owns more than 50 per
cent of the voting shares. If Ccorp sells to another corporation (Dcorp) its 60 per
cent holding in Acorp, and if Dcorp replaces Ccorp in the shareholder agreement
between Bcorp and Ccorp, Dcorp will be considered as acquiring 60 per cent of the
voting shares of Acorp for purposes of subsection 110(3) of the Act. In this case,
for purposes of calculating party-size thresholds in section 109 of the Act, Acorp
will be considered an affiliate of Ccorp.
Guidelines
Example 2 — Voting Trusts
Occasionally, shareholders of a corporation (Acorp) may create a voting trust
whereby some or all the shareholders collectively confer their voting rights to a
voting trustee. In some circumstances, the voting trustee may have the right to exer-
cise voting rights that, in aggregate, constitute more than 50 per cent of the out-
standing voting rights attached to the shares of the corporation. Further, the voting
trust agreement may require that the shares subject to the agreement be registered
in the name of the voting trustee. However, corporate control and, as a conse-
quence, corporate affiliation are primarily dependent on the beneficial ownership of
voting shares, not their registered ownership. Accordingly, where a shareholder
who is the beneficial owner of shares with more than 50 per cent of the outstanding
voting rights enters into a voting trust agreement that grants a voting trustee the
right to exercise such voting rights, the shareholder still controls the corporation. If
the shareholder is a corporation, it is affiliated with Acorp for purposes of subsec-
tion 2(2) of the Act. The voting trust could not be affiliated with Acorp in any event
because the affiliation provisions in subsection 2(2) do not extend to trusts.
523
Pre-Merger Notification Interpretation Guideline Number

10: Notifiable Transactions Regulations — Transactions
and Events (Section 14 of the Regulations)*
Background
Section 14 of the Notifiable Transactions Regulations (“the Regulations”) provides
for the adjustment of the aggregate value of assets or the gross revenues from sales
when a transaction or event has occurred after the close of the fiscal period for
which audited financial statements are available. Adjustments may be made to re-
flect the transaction or event, the consequence of which, if taken into account,
would affect the determination of whether notice is required under section 114 of
the Act. Paragraph 14(2)(c) of the Regulations provides that a transaction or event
referred to in subsection 14(1) of the Regulations includes any agreement, arrange-
ment, understanding or other transaction or event that is likely to have a material
effect on the aggregate value of the assets or gross revenues from sales of the par-
ties to the proposed transaction or of their affiliates. A material effect is one which
would affect the determination of whether notice is required under section 114 of
the Act.
The issue of whether a transaction or event under paragraph 14(2)(c) of the Regula-
tions has a material effect on a proposed transaction may arise in cases where a
shell company is incorporated for use as an acquiring corporation, or where one or
more parties to a transaction enters into, and completes, a second transaction prior
to completion of the first.

524
Shell Companies
Acquisitions are frequently structured in such a way that a shell company is incor-
porated for the sole purpose of acting as the acquiring corporation in a proposed
transaction. From the time of incorporation up until a short time prior to closing the
transaction, the assets and revenues of the shell company may be nonexistent, while
those of its affiliates, if any, may be below the party-size threshold under section
109 of the Act. However, just prior to closing, a significant sum of money may be
transferred to the shell company for purposes of carrying out the transaction. These
injected funds, if taken into account, could result in the party-size threshold being
exceeded, potentially making the transaction notifiable.
For example, this situation may arise when a foreign company with no assets in
Canada incorporates a Canadian shell company for purposes of completing an ac-
quisition of an operating business in Canada and, immediately prior to closing, in-
jects into the shell company the funds required to complete the purchase.
Policy
A transaction or event referred to in section 14 of the Regulations should be sepa-
rate from the transaction which gives rise to the question of prenotification. Thus,
where a significant sum of money is injected into a shell company prior to closing a
proposed transaction for purposes of carrying out that transaction, such a temporary
Guidelines
change to the asset base of the shell company is not considered separate from the
proposed transaction and is therefore not a transaction or event which would neces-
sitate an adjustment to the shell company’s financial statements under section 14 of
the Regulations.
Section 109 Parties

Section 109 of the Act provides that Part IX of the Act does not apply to a proposed
transaction unless the “parties thereto, together with their affiliates”, exceed the
thresholds set out in paragraphs 109(1)(a) or 109(1)(b) of the Act. Where a pro-
posed transaction is subject to prenotification, the parties may not close the transac-
tion prior to expiry of the relevant waiting period set out in section 123 of the Act.
Between the date on which an agreement between two parties is executed and the
date on which the transaction closes, one or more parties to the proposed transac-
tion, or their affiliates, may become involved in other transactions which may af-
fect the size of the party(ies). In these circumstances, it is possible that a party or
parties falling below the section 109 threshold could now exceed it, thereby making
the first transaction notifiable where, prior to involvement in the second transac-
tion, it was not.
Policy
Where a party to a proposed transaction, or its affiliates, enters into a second pro-
posed transaction which will be completed before the first transaction closes, the
second transaction is considered a transaction or event for purposes of section 14 of
the Regulations. In such circumstances, the party to the second transaction should
525
determine whether that transaction is likely to have a material effect on the party-
size threshold under section 109 of the Act for purposes of the first transaction.
Example
A corporation (Acorp) enters into an agreement to purchase assets from another
corporation (Bcorp). The purchase agreement is dated February 1; the closing is
scheduled for September 1. The aggregate values of the assets or the gross revenues
from sales of Acorp and Bcorp, together with their affiliates, do not exceed the
threshold under section 109 of the Act. Accordingly, the parties are not required to
prenotify. Before the transaction with Bcorp closes, Acorp enters into an agreement
on March 1 to purchase assets from a third corporation (Ccorp). The transaction
with Ccorp closes on August 1. Whether or not the transaction with Ccorp is notifi-
able, the effect of this transaction is to increase Acorp’s party size. If this increase
is sufficient to render Acorp’s transaction with Bcorp notifiable, then Acorp’s
transaction with Ccorp has a material effect on the transaction between Acorp and
Bcorp. Accordingly, Acorp’s financial statements should be adjusted pursuant to
section 14 of the Regulations to reflect the transaction with Ccorp in order to deter-
mine whether the adjusted aggregate value for Acorp’s assets will cause the com-
bined party-size of Acorp and Bcorp, together with their affiliates, to exceed the
section 109 threshold.

11: Corporate Spin-Offs*

526
Background
Paragraph 113(a) of the Act provides an exemption from prenotification under Part
IX of the Act in cases where all parties to a transaction are affiliates of each other.
The definition of affiliates for purposes of the Act is found in subsection 2(2) of the
Act.
A spin-off is a form of corporate reorganization that results in a subsidiary or divi-
sion of a corporation becoming an independent company. In a spin-off, the parent
corporation transfers part of its assets to the new independent, while the shares of
the independent are distributed to the shareholders of the parent without surrender
by them of any stock in the parent.
Policy
Corporate spin-offs may be treated as acquisitions of assets by the new corporate
entity or acquisitions of shares of the new corporate entity and may be subject to
prenotification if the party-size and transaction-size thresholds are exceeded, unless
the affiliates exemption under paragraph 113(a) of the Act applies.
Example 1
A corporation (Acorp) is a publicly traded corporation. Bcorp is the major control-
ling shareholder, holding 51 per cent of the shares of Acorp. Ccorp is a minority
Guidelines
shareholder with 25 per cent. Acorp decides to spin off one of its divisions. For that
purpose, Acorp incorporates a new, wholly-owned subsidiary, Dcorp, and transfers
all of the assets of the division, valued at $40 million in the audited financial state-
ments of Acorp, to Dcorp in exchange for shares of Dcorp. Acorp intends to dis-
tribute the shares of Dcorp to Acorp’s shareholders in equal proportions to the
shares they hold in Acorp and to list the shares of Dcorp on a recognized stock
exchange in Canada. After the reorganization, Bcorp will hold 51 per cent of the
shares of both Acorp and Dcorp. Accordingly, Bcorp’s acquisition of shares in
Dcorp will be exempt under paragraph 113(a) of the Act because Bcorp and Dcorp
are affiliates. Similarly, Dcorp’s acquisition of Acorp’s assets will be exempt.
However, Ccorp is not affiliated with Dcorp. If Ccorp and Dcorp (together with its
affiliates, Acorp and Bcorp) meet the party-size threshold under section 109 of the
Act and given that Dcorp meets the transaction-size threshold under subparagraph
110(3)(a)(i) of the Act, Ccorp will be required to give notice of its acquisition of a
25 per cent interest in the shares of Dcorp.
Example 2
A corporation (Acorp) is a widely-held corporation traded on a stock exchange,
with no one shareholder holding more than 10 per cent of the outstanding shares.
Acorp decides to spin off one of its divisions. For that purpose, a new corporation,
Bcorp, is established. A person that is unrelated to Acorp or its shareholders ini-
tially owns Bcorp. Acorp transfers all of the assets of the division to Bcorp in ex-
change for substantially all of the outstanding shares of Bcorp. Acorp intends to
distribute the shares of Bcorp to its shareholders in equal proportions to the shares
they hold in Acorp and to list the shares of Bcorp on a recognized stock exchange
527
in Canada. At the outset, because Acorp does not control Bcorp and they are not
under common control, the exemption for affiliates under paragraph 113(a) of the
Act does not apply. Accordingly, the transfer of assets from Acorp to Bcorp may be
notifiable under subsection 110(2) of the Act. However, the acquisition of shares of
Bcorp by the shareholders of Acorp would not be notifiable because none of the
shareholders will exceed the 20 per cent threshold for publicly traded voting shares
under subparagraph 110(3)(b)(i) of the Act.

12: Requirement to Submit a New Pre-Merger Notification
and/or Advance Ruling Certificate Request Where a
Proposed Transaction is Subsequently Amended*
the Commissioner or other Bureau officials relating to the content described herein.
This Guideline is not intended to be a binding statement of how discretion will be
exercised in a particular situation and should not be taken as such, nor is it intended
to substitute for the advice of legal counsel to the parties, or to restate the law.
Guidance regarding a specific proposed transaction may be requested from the
Merger Notification Unit (“MNU”).16
This Guideline describes common amendments to proposed transactions and dis-
cusses whether such amendments would typically require parties to file a new noti-
fication and/or request for an Advance Ruling Certificate (“ARC”). The Guideline
applies where an amendment is made (i) while the Bureau’s review is ongoing and
(ii) after an ARC or a No-Action Letter has been issued by the Bureau, but prior to
the closing of the proposed transaction.
1. — Background
All parties to a proposed transaction that exceeds the relevant monetary thresholds
set out in sections 109 and 110 of the Act are required by section 114 to notify the
Commissioner and supply the prescribed information set out in section 16 of the

16 For further information, please refer to page 14 of the Procedures Guide for Notifiable
Transactions and Advance Ruling Certificates Under the Competition Act.
528
Notifiable Transactions Regulations (“notification”) prior to completing the trans-

action. Further, in accordance with section 118 of the Act, each party is required to
certify under oath or solemn affirmation that the information it has supplied in the
notification is, to the best of its knowledge and belief, correct and complete in all
material respects at the time of filing. The initial 30-day waiting period set out in
paragraph 123(1)(a) will commence once the Commissioner has received a com-
plete notification.
Unlike the notification provisions in Part IX of the Act, the Act does not stipulate
the information that must be supplied to the Commissioner in support of a request
for an ARC. Parties should supply the Commissioner with all information relevant
to the proposed transaction and its potential effect on competition.17
2. — Policy
Where a proposed transaction is amended following receipt of an ARC request or a
complete notification by the Commissioner, parties may be required to submit a
new notification or ARC request, as applicable.
(i) In situations where the information supplied with the original notification is
not correct and complete in all material respects relative to the amended trans-
action, parties will be required to submit a new notification.
(ii) In situations where the amendment to the proposed transaction that is the
Guidelines
subject of the original ARC request results in the Bureau having to conduct a
more in-depth or different competitive effects analysis, parties will be required
to submit a new ARC request.
In most cases, an amendment to a transaction will have the same impact on a notifi-
cation and an ARC request. However, in some specific instances, the same amend-
ment may have different implications for a notification than an ARC request be-
cause the Act prescribes the information that must be supplied with a notification,
but does not stipulate the information that must be supplied with an ARC request.
Parties are encouraged to consult the MNU when considering delaying the submis-
sion of a notification or ARC request because of concerns that a particular aspect of
a proposed transaction may not be final or may be subject to change, which may
require a new notification or ARC request. The effect of submitting a new notifica-
tion and/or ARC request on statutory waiting periods and service standards, as ap-
plicable, and filing fees is discussed in section 4 of this Guideline.
2.1 — Notification
Section 118 of the Act requires that the information supplied with a notification be
“correct and complete in all material respects” at the time of filing. Where a trans-
action is amended such that the information supplied with the original notification
17 Detailed guidance on the Bureau’s policy regarding information typically required in an

ARC request is outlined in section 3.3 of the Competition Bureau Fees and Service Stan-
dards Handbook for Mergers and Merger-Related Matters.
529
is not correct and complete in all material respects relative to the amended transac-
tion, parties will be required to submit a new notification.
In determining whether the information supplied with a notification is correct and
complete in all material respects relative to an amended transaction, the Bureau will
consider, among other things:
(a) the description of the proposed transaction and the parties;
(b) the relationship of an added party to the other parties to the transaction
(e.g., affiliate, customer, supplier or competitor);
(c) whether a redistribution of assets or ownership interests among the existing
parties to the transaction would increase the ownership interest to be acquired
by a party by 10% or more, or would cause a party to exceed a new subsection
110(3) or (6) ownership threshold;
(d) where a new asset is added, whether that asset is non-operational or ancil-
lary to existing assets; and
(e) where an operational asset is added, whether that asset creates or enhances
a competitive overlap (horizontal or vertical) between the businesses of the
parties to the transaction.
2.2 — ARC Request

A new ARC request will be required18 where an amendment to a proposed transac-
tion results in the Bureau having to conduct a more in-depth or different analysis
regarding the competitive effects of the amended transaction.
In making this determination, the Bureau will consider, among other things, the
factors set out in section 2.1 above, and:
(a) whether the complexity designation and the information required to com-
mence the service standard for the amended transaction differs from the origi-
nal proposed transaction; and
(b) where there is a redistribution of assets or ownership interests among the
parties, whether the original ARC request contemplated such a redistribution.
3. — Examples
Below are examples of common amendments to transactions and discussion about
whether or not such amendments will typically require parties to file a new notifi-
cation and/or ARC request.
18 The decision to seek an ARC is in the discretion of parties to a proposed transaction. For
the purpose of this Guideline, it is assumed that following an amendment to a proposed
transaction, the parties thereto will continue to seek an ARC. Accordingly, references to a
new ARC request being “required” should be read in this manner.
530
3.1 — Addition of a New Party

3.1.1 — Notification
Where a transaction is amended to add a new party, a new notification providing
the prescribed information for the added party must typically be submitted as all
parties to a proposed transaction that is subject to Part IX of the Act are required
under section 114 to notify the Commissioner of the proposed transaction and sup-
ply the prescribed information.
There are, however, some circumstances where the addition of a new party is un-
likely to require a new notification, as the original notification is likely to continue
to be correct and complete in all material respects. These include amendments
where:
(a) the added purchaser proposes to acquire less than a 10% ownership
interest;
(b) the added party is an affiliate of an existing party, other than a significant
affiliate19 whose prescribed information was not submitted with the
notification;
(c) the added party already controls the target;
(d) the added party is a new vendor in a share transaction (see subsection
109(2) of the Act); and
Guidelines
(e) the added party is a guarantor.
3.1.2 — ARC Request

Where a proposed transaction that is the subject of an ARC request is amended to
add a new party, the Bureau will require information relating to the added party to
determine whether a more in-depth or different competitive effects analysis is re-
quired. In making this determination, the Bureau will consider, among other things:
(a) the relationship of the added party to the other parties to the transaction.
For example, the addition of a competitor, potential competitor, customer or
supplier will typically require a new ARC request;
(b) whether the added party is a purchaser or a vendor. For example, a new
vendor, guarantor or affiliate of an existing party will typically not require a
new ARC request;
19 Subparagraph 16(1)(c)(iii) of the Notifiable Transactions Regulations requires that, for

each party, “a list of its affiliates that have significant assets in Canada or significant gross
revenues from sales in, from or into Canada” be provided. For the purposes of determining
whether an affiliate, or affiliates, of a notifying party can be excluded on the basis of it not
being considered “significant”, the Bureau generally considers that an affiliate is not “signif-
icant” if neither the book value of its assets in Canada nor its annual gross revenues from
sales in, from or into Canada exceeds $500,000, and neither the total value of assets nor the
total value of revenues of all of the excluded affiliates exceeds $1,000,000.
531
(c) the interest to be acquired by the added party and the ability of this new
purchaser to influence the economic behaviour of the target business. For ex-
ample, where the added party will be acquiring, absent any shareholder, pool-
ing, voting or other agreement affecting how shares or interests are voted, an
interest of less than 10% in the assets or combination that are the subject of the
proposed transaction or of the voting shares of the target corporation, a new
ARC request will typically not be required. Alternatively, where the added
party will be acquiring an interest of 10% or more, absent a clear indication
otherwise, the Bureau must consider the ability of the new purchaser to influ-
ence the economic behaviour of the business. This analysis will normally re-
quire a new ARC request.20
3.2 — Addition of a New Asset

Where a proposed transaction is amended to include an additional asset, whether a
new notification or ARC request will be required will depend on the nature of the
asset.
For example, where the asset being added does not relate to the operational aspects
of the business that is the subject of the proposed transaction (e.g., an administra-
tive building in the case of a manufacturing business), or the asset being added is
ancillary to the other assets being acquired, a new notification or ARC request will
not typically be required. In evaluating whether an asset is non-operational or ancil-
lary, the Bureau will consider both qualitative and quantitative factors, including
the book value of the added asset and its size in relation to existing assets.
Where an operational asset is added, a new notification or ARC request will be
required, unless the parties can demonstrate clearly and unequivocally that the new
asset does not create or enhance any competitive overlap (horizontal or vertical)
between the businesses of the parties, assuming properly defined product and geo-
graphic markets.
3.3 — Addition of New Voting Shares or the Redistribution of Assets,

Voting Shares or Ownership Interests21
Where a proposed transaction is amended to:
(a) increase the voting shares to be acquired by an existing party, whether
through the addition of new shares or the redistribution of shares among pur-
chasers; or
20 Refer to the discussion of significant interest, partial interests and interlocking director-
ships in the Merger Enforcement Guidelines for further details regarding factors that the
Bureau may consider in conducting its analysis.
21 This section relates only to existing purchasers; it does not contemplate the addition of
new purchasers. Refer to the discussion of significant interest, partial interests and
interlocking directorships in the Merger Enforcement Guidelines for further details regarding
factors that the Bureau may consider in conducting its analysis.
532
(b) increase the ownership interest of one or more purchasers as a result of a

redistribution of interests in an asset or combination,
and the increase does not cause an existing party to obtain an additional 10% voting
interest, or to exceed a new subsection 110(3) or 110(6) ownership threshold, a new
notification or ARC request22 will not typically be required. Further, if the party
acquiring the additional voting shares already holds more than a 50% voting inter-
est, the acquisition of any additional voting interest by that party will not require a
new notification or ARC request.
In all other instances, the Bureau will consider whether the original notification is
correct and complete in all material respects relative to the amended transaction, in
particular the description of the proposed transaction. In the case of an ARC re-
quest, a more in-depth or different competitive effects analysis is often required to
determine whether the amendment impacts the ability of one or more of the ex-
isting parties to the transaction to influence the economic behaviour of the target
business.
3.4 — Removal of an Asset or Party

Where an asset or party is removed from a proposed transaction, a new notification
and/or ARC request is not normally required as (a) the information supplied with
the notification will continue to be correct and complete in all material respects
Guidelines
relative to the amended transaction; and (b) such a change will not affect the com-
petitive effects analysis. However, as discussed in section 3.3 above, where the
removal of a party results in an existing purchaser increasing its ownership interest,
a new notification and/or ARC request may be required.
4. — Submitting a New Notification or ARC Request

When submitting a new notification, parties may rely on subsection 116(2.1) of the
Act to avoid resubmitting information that has previously been supplied to the
Commissioner, provided that the requirements of that subsection are met.
Where the amendment to a transaction involves the addition of a party, receipt of a
notification from the added party containing an accurate description of the amended
transaction and the parties to the transaction (as well as other prescribed informa-
tion in respect of the added party), and a certification under sections 116(2.1) and
118 of the Act, will typically be sufficient. The initial 30-day waiting period will
only commence upon receipt of the complete filing from the added party.
4.1 — Commencement of Initial Waiting Period Where a New

Notification is Required
Where a new notification is required, the amended transaction will be considered a
new transaction and the initial 30-day waiting period will only commence upon
22 In the case of an ARC request, the existence of a shareholder, pooling, voting or other
agreement affecting how shares or interests are voted may affect that determination.
533
receipt by the Commissioner of a complete filing in respect of the amended

transaction.
4.2 — Requirement to Pay Filing Fee

Where a new notification and/or ARC request is required, parties must also pay the
applicable filing fee, except where parties have filed both a notification and an
ARC request and the amendment to the transaction only requires one of them to be
resubmitted. In this latter instance, because either the initial ARC request or notifi-
cation does not need to be updated with respect to the amended transaction, a new
filing fee is not payable as the Competition Bureau Fees and Service Standards
Policy for Mergers and Merger-Related Matters (“Merger Fees Policy”) provides
that only one fee applies where both a notification and an ARC request are submit-
ted with respect to the same proposed transaction.23
Parties may also want to consider whether they are entitled to rely on the Bureau’s
refund policy. Where parties withdraw their notification and/or ARC request within
two business days of receipt by the Bureau, parties may be entitled to a refund. For
further information on the Bureau’s refund policy, please refer to the Merger Fees
Policy.

13: Satisfying the Information Requirements set out in
Section 16 of the Notifiable Transactions Regulations and
Completeness of Notification*
23 See the Competition Bureau Fees and Service Standards Policy for Mergers and Merger-
Related Matters; also refer to the Competition Bureau Fees and Service Standards Hand-
book for Mergers and Merger-Related Matters.
534
Background
Subsection 114(1) of the Act requires that all parties to a proposed transaction that
exceeds the relevant thresholds set out in sections 109 and 110 of the Act must
notify the Commissioner prior to the completion of the transaction and supply the
Commissioner with certain information set out in section 16 of the Regulations
(“Notification”).
Paragraph 123(1)(a) of the Act provides that parties submitting a Notification under
subsection 114(1) shall not complete the proposed transaction before the expiration
of 30 days after receipt of a complete Notification by the Commissioner.25
This Guideline addresses various information requirements set out in section 16 of
the Notifiable Transactions Regulations (“Regulations”)26 that are often misinter-
preted and discusses how parties can best satisfy these requirements to avoid a de-
termination by the MNU that their notification is incomplete. Where parties have
questions regarding the information required to be supplied with a Notification,
they are strongly encouraged to consult the MNU in advance of submitting a Noti-
fication. Parties may also wish to consult the Procedures Guide for Notifiable
Transactions and Advance Ruling Certificates Under the Competition Act (“Proce-
dures Guide”).27
Guidelines
Policy
1. — Information Required to be Submitted with a Notification
The Act does not specify the form in which a Notification must be made; however,
to assist parties in compiling the prescribed information, and to assist the MNU in
making a timely determination of whether the Notification is complete, the Bureau
has developed a template form. This form sets out the information required to be
submitted pursuant to section 16 of the Regulations, and allows most material to be
attached as identified appendices. Parties that are required to submit a Notification
25 In the case of a hostile transaction or an unsolicited bid where subsection 114(3) of the
Act applies, subsection 123(3) of the Act provides that the waiting period is determined
without reference to the day on which the prescribed information is received from the target.
Thus, the initial waiting period begins after the Commissioner has received a complete Noti-
fication from the acquirer.
26 http://laws.justice.gc.ca/eng/SOR-87-348/index.html.
27 http://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03302.html.
535
are strongly encouraged to use the Bureau’s form, which is available on the Bu-
reau’s website.28
Each informational requirement must be fully addressed. In certain instances, a no-
tifying party may determine that information requested as part of the Notification
does not exist, in which case the notifying party should indicate in its Notification
that the information does not exist. Leaving the corresponding area on the form
blank or writing “n/a” is insufficient and may result in delay, as the MNU must
contact the notifying party for clarification. Where required information is not be-
ing provided for another reason, such as one of the reasons set out in section 116 of
the Act, the notifying party must ensure that it has fully complied with the require-
ments of the applicable subsection.29
a. — Significant Affiliates
Subparagraph 16(1)(c)(iii) requires that, for each party, “a list of its affiliates that
have significant assets in Canada or significant gross revenues from sales in, from
or into Canada...” be provided. For purposes of determining whether an affiliate or
affiliates of a party can be excluded on the basis of not being considered signifi-
cant, the Bureau generally considers assets in Canada or gross revenues from sales
in, from or into Canada not to be significant if they are worth $500,000 or less for
each excluded affiliate and the total value of all of the excluded affiliates is
$1,000,000 or less.
b. — Principal Businesses
Subparagraph 16(1)(c)(iv) requires that a description of the principal businesses of
each party and of its affiliates be provided. While “principal businesses” is not de-
fined in the Regulations, the description by a notifying party of its principal busi-
nesses should be consistent with how the principal businesses are identified and
described in documents prepared by the notifying party, and/or its affiliates, in the
ordinary course of business. Such documents include annual reports, financial
statements, annual information forms (or 10-K reports for U.S. corporations), pro-
spectuses and other documents filed with securities commissions, stock exchanges
or other similar authorities in Canada or elsewhere.
c. — Interim Financial Statements

Clause 16(1)(c)(iv)(A) requires that the notifying party provide its most recent an-
nual report and the most recent annual report of each of its affiliates. Where an
annual report is not available or the financial statements are different from those
contained in the report, the notifying party must provide for itself and each of its
affiliates, audited financial statements relating to all principal businesses for the
most recently completed fiscal year and financial statements for subsequent interim
28 http://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/01705.html.
29 For further information, please refer to section 2.4 of the Procedures Guide.
536
periods. Financial statements for subsequent interim periods must be provided

whenever available, and not only if the annual report is not available or if the finan-
cial statements are different from those contained in the report.
d. — Information Relating to Customers and Suppliers

Clause 16(1)(c)(iv)(C) requires the notifying party to provide for itself and each of
its affiliates, the twenty most important current suppliers and customers for each
principal category of products. In addition, the contact name, telephone number and
address of those suppliers and customers must be provided together with the annual
volume or dollar value of purchases from and sales to those suppliers and
customers.
Full contact names, or at least a surname and a form of address (Mr., Ms, Dr., etc.),
telephone numbers and addresses must be provided. Notifying parties are expected
to make reasonable enquiries to determine this information before making a claim
pursuant to subsection 116(1) of the Act that certain of the required information is
not known or not reasonably obtainable.30
The most important suppliers and customers should be determined based on annual
volume or dollar value.
Notifying parties often submit customer and supplier information that relates to the
most recent completed fiscal year instead of information relating to current custom-
Guidelines
ers and suppliers. While information regarding annual volumes or dollar values as-
sociated with each customer or supplier must be as current as possible, a Notifica-
tion that includes customer and supplier information that relates to the most recent
completed fiscal year, as opposed to current information, will not typically be de-
termined to be incomplete on this basis. However, notifying parties should con-
sider, as a best practice, providing customer and supplier information for a 12-
month rolling period, as of the last month prior to the submission of the Notifica-
tion, or supplementing information relating to the most recently completed fiscal
year with year-to-date information.
It is not uncommon for notifying parties to provide the twenty most important cur-
rent Canadian suppliers and customers in their Notification. A Notification that in-
cludes such information will typically not be determined to be incomplete on this
basis, as Canadian customers and suppliers are often more relevant for the purposes
of the Bureau’s analysis.
Notifying parties sometimes provide a list of fewer than 20 customers or suppliers,
indicating that they do not maintain contact information for the remaining small
customers or suppliers. A Notification that includes information in respect of fewer
than 20 customers or suppliers will not typically be determined to be incomplete,
30 Any required information that cannot be supplied because it is not known or not reasona-
bly obtainable must be identified pursuant to subsection 116(1) of the Act. Parties are en-
couraged to identify missing information at or near the place in the notification form where
such information would have been provided, with a cross-reference to a statement under oath
or solemn affirmation that complies with section 116.
537
provided that the customers or suppliers listed account for at least 95% of sales or
purchases.
With respect to supplier information, a notifying party can typically omit from its
Notification information relating to its general suppliers (e.g. landlords, utilities,
legal services providers, office supply companies, etc.), as this information is typi-
cally not relevant to whether or not the proposed transaction would likely prevent
or lessen competition substantially. Where a notifying party chooses to omit infor-
mation relating to general suppliers and only provide information relating to suppli-
ers that are relevant to industries in which the parties to the proposed transaction
are involved, the notifying party should make the appropriate claim pursuant to
subsection 116(2) of the Act.31
e. — Officer or Director
Paragraph 16(1)(d) requires that the following information be provided:
16. (I)(d) “. . . in respect of each party, and each of its affiliates referred to in subpar-
agraph (c)(iii), all studies, surveys, analyses and reports that were prepared or re-
ceived by an officer or director of the corporation — or in the case of an unincorpo-
rated entity, an individual who serves in a similar capacity — for the purpose of
evaluating or analysing the proposed transaction with respect to market shares . . .”
The Regulations do not define “officer” or “director”. A person will typically be
considered an officer or director where that person’s position is either designated
by the bylaws or articles of the corporation or that person is appointed by the Board
of Directors. With respect to non-corporate entities, a person whose position is des-
ignated in a similar manner will similarly typically be considered an officer or
director.
f. — Produced, Supplied, Distributed and Capacity

Various paragraphs of section 16 of the Regulations use the terms “produced”,
“supplied”, “distributed”, and “capacity”. These terms should be interpreted
broadly and, if there is any doubt, parties are strongly encouraged to consult the
MNU in advance of submitting a Notification.
g. — Hyperlinks
Subsection 16(2) provides that:
16. (2) Instead of being supplied with a report or financial statement referred to in
clause (1)(c)(iv)(A), the Commissioner may be supplied with the address of an In-
ternet site from which a copy of those documents can be obtained without charge,
which is operational at the time the address is supplied and which remains opera-
tional prior to the expiry of the period referred to in subsection 123(1) of the Act.
Subsection 16(2) facilitates the electronic submission of documents prescribed by
clause 16(1)(c)(iv)(A) by referencing the addresses of Internet sites from which a
31 For further information, please refer to section 2.4 of the Procedures Guide.
538
copy of each document can be obtained. Where the Internet address provided as a
source is inoperative at the time the Notification is verified for completeness, or the
document(s) that is linked to it is incomplete, or payment is required to access the
document(s), the notifying party will be advised as expeditiously as possible to
make these documents available by either referencing an operative Internet address
or by providing electronic or paper copies to the MNU. The Notification will be
considered incomplete and the applicable waiting period will not commence until
such time the documents are made available to the Bureau.
2. — Confidentiality Claims Pursuant to Subsection 116(1) of the Act

For the purpose of subsection 116(1), it is the Bureau’s position that a confidential-
ity requirement established by law includes a statutory or common law confidenti-
ality requirement (such as solicitor-client privilege), but not a contractual confiden-
tiality requirement. If a party claims that information cannot be provided because
such disclosure would create a significant risk that confidential information will be
used for an improper purpose or that information that must, for commercial rea-
sons, be kept confidential will be disclosed to the public, it is up to the party mak-
ing the claim to provide evidence and explain why the protections under section 29
of the Act are not sufficient.
3. — Incomplete Notifications
Guidelines
A Notification that includes documents or appendices that have not been provided
in their entirety or where any portion of an affidavit (including the signature) is
omitted, the Notification will typically be considered incomplete. In such cases, the
notifying party will be advised as expeditiously as possible, the Notification will
not be considered complete, and the applicable statutory waiting period will not
commence until all required information is received.
Where the omission is inadvertent, and only a small number of pages are missing
(or unreadable), the Bureau’s discretion to exercise some flexibility may be war-
ranted, depending on the particular facts and at the discretion of the Bureau. In such
instances, the notifying party will be given up to 24 hours from when the MNU
notifies them of the omission, to provide the inadvertently omitted information
without impacting the date upon which the Notification is determined to be com-
plete. If the notifying party does not fully respond within this 24 hour period, the
Notification will not be determined to be complete until the omitted information is
received.
539

14: Duplication Arising From Transactions Between
Affiliates*
Merger Notification Unit.32
This Guideline addresses the treatment of duplicative assets and sales revenue aris-
ing from transactions between affiliates when determining whether a proposed
transaction exceeds the party-size and transaction-size thresholds under sections
109 and 110 of the Act, respectively. Proper consideration and calculation of these
assets and sales is important when evaluating whether a transaction is notifiable. It
is particularly applicable in the context of inter-company transfers between a Cana-
dian-based affiliate and one located in a different country.
1. — Background
Section 114 of the Act places an obligation on parties to a proposed transaction that
exceeds the party-size and transaction-size thresholds under sections 109 and 110
of the Act, respectively, to notify the Commissioner. The section 109 party-size
threshold is measured by either the value of the parties’ assets in Canada, or the
gross revenues from sales in, from or into Canada. The section 110 transaction-size
threshold is measured by either the value of the parties’ assets in Canada, or the
gross revenues from sales in or from Canada generated from those assets.
The Notifiable Transactions Regulations (“Regulations”) provide that, in most
cases, the value of the parties’ assets and gross revenues from sales should be cal-
culated using their most recent audited financial statements. Paragraph 3(a) of the
Regulations requires that audited financial statements be prepared in accordance

540
with the accounting principles normally used by that party (or its affiliates) and that
are generally accepted for the type of business carried on by that party (or its affili-
ates). It is important to note that paragraph 3(b) of the Regulations also requires the
use of working papers, and other records used to prepare audited financial state-
ments, if reference to these documents is necessary to obtain the information re-
quired for determining the aggregate value of assets or the gross revenues from
sales.
In addition, paragraph 4(1)(a) and subsection 5(2) of the Regulations provide that,
in determining these amounts, any amount that represents duplication arising from
transactions between affiliates33 “shall be deducted”.
2. — Policy
The purpose of deducting amounts that represent duplication is to eliminate double
counting that may arise when combining amounts from the financial statements of
affiliated entities. However, paragraph 4(1)(a) and subsection 5(2) of the Regula-
tions do not permit deductions for all transactions between affiliates, even where
such transactions would be eliminated on consolidation.
When determining whether the party-size and transaction-size thresholds in the Act
are exceeded, subsection 5(2) of the Regulations allows a party to deduct revenue
from the sale of a product only if it duplicates an equivalent amount of revenue
Guidelines
from another sale of a product that is already included in the party-size or transac-
tion-size calculation. Similarly, paragraph 4(1)(a) of the Regulations allows a party
to deduct an amount from the aggregate value of assets only if it duplicates an
equivalent amount that is already included in the party-size or transaction-size cal-
culation. Such “duplication” may differ from the accounting duplication removed
through the consolidation of financial statements, as the party-size and transaction-
size notification thresholds require a sufficient nexus to Canada. More specifically,
while the geographic origin and destination of sales, or the location of an asset,
may not necessarily be important in most accounting exercises, these factors are
essential when establishing the economic significance of the merging parties in
Canada for the purposes of determining whether the notification thresholds have
been exceeded.
In many cases, it will be apparent from the financial statements of the merging
parties whether a notification is required without the need for a duplication analy-
sis. For example, when assessing whether the party-size threshold is exceeded, if
the total value of the assets in Canada and the gross revenues from sales in, from or
into Canada of the merging parties, as stated in their consolidated financial state-
ments, are below the threshold, it is not necessary to make any further adjustments
based on the financial statements of the individual affiliates. Similarly, when deter-
mining whether the transaction-size threshold is exceeded, if the total value of the
assets in Canada and the gross revenues from sales in or from Canada of the target
33 An affiliate is an affiliated corporation, partnership or sole proprietorship within the

meaning of subsection 2(2) of the Act.
541
company, as stated in its consolidated financial statements, are below the threshold,
no further adjustments are required.
However, when the target of a proposed merger is a Canadian subsidiary of a for-
eign parent, duplication should not be assessed solely on the basis of consolidated
financial statements. In such circumstances, when starting from the consolidated
financial statements of a foreign parent, it may be necessary to add back certain
inter-company transfers to determine whether the Canadian entity exceeds the
transaction-size threshold. In such instances, particularly if there are multiple Cana-
dian affiliates, the maximum potential transaction-size can be obtained by adding
together the values stated in each affiliate’s (unconsolidated) financial statements,
and then, if necessary, identifying and deducting inter-company transactions that
represent duplication among those affiliates.
Examples
reau’s interpretation of this Guideline, as outlined above.
Example One
A and B are Canadian corporations and are subsidiaries of C, another Canadian
corporation. Corporation A manufactures a widget and sells it to B for $100. Cor-
poration A records gross revenue from sales of $100 in its audited financial state-
ments from this transaction. Corporation B then sells the widget to a customer lo-
cated in the United States for $150, and records gross revenue from sales of $150 in
its audited financial statements from this transaction. As a result of these transac-
tions, Corporation A has gross revenues from sales “in” Canada of $100, and B has
gross revenues from sales “from” Canada of $150. If these amounts were added
together, the total gross revenues from sales in or from Canada (or in, from or into
Canada) of A, B and C arising from these transactions would be $250.
In determining the party-size under section 109 of the Act, $100 of these sales
represents duplication arising from a transaction between A and B and a subsequent
sale by B, and may be deducted. For the purpose of section 109, the gross revenues
of A and its affiliates from these sales are $150.
Whether this $100 represents duplication for the purpose of determining the trans-
action-size depends on the nature of the proposed transaction. With regard to a
proposed acquisition of C, $100 of the above sales represents duplication and may
be deducted, such that for the purpose of section 110 of the Act, the gross revenues
of C and corporations controlled by C arising from these sales are $150. With re-
gard to a proposed acquisition of B, the revenues of A are irrelevant and, for the
purpose of section 110, the gross revenues of B from these sales are $150. With
regard to a proposed acquisition of A, the revenues of B are irrelevant and, for the
purpose of section 110, the gross revenues of A generated from these sales are
$100. In other words, in regard to a proposed acquisition of A, even though the
$100 revenue results from a transaction between affiliates, it is not deducted be-
cause it is not duplicative of another amount included in the transaction-size
calculation.
542
Example Two
A is a Canadian corporation. Corporation A is wholly-owned by B, which is incor-
porated in the United States. Corporation B carries out its manufacturing activities
through A, which is located in Canada. Corporation B is responsible for marketing
and distributing the products and has a network of warehouses and sales offices
throughout the United States. Corporation A manufactures a widget and sells it to B
for $100. Corporation A records gross revenue from sales of $100 on its audited
financial statements from this transaction. Corporation B then sells the widget to a
customer located in Canada for $150, and records gross revenue from sales of $150
in its audited financial statements from this transaction. As a result of these transac-
tions, A will have gross revenues from sales “from” Canada of $100, while B will
have gross revenues from sales “into” Canada of $150. If these amounts were ad-
ded together, the total gross revenues from sales “in, from or into” Canada of A and
B would be $250.
In determining the party-size under section 109 of the Act, $100 of these sales
represents duplication arising from a transaction between A and B and a subsequent
sale by B, and may be deducted. For the purpose of section 109, the gross revenues
of A and B from these sales (in, from or into Canada) are $150.
In determining the transaction-size, only sales in or from Canada generated from
assets in Canada are included; as such, the sales by B into Canada are irrelevant.
Accordingly, in a proposed acquisition of either A or B, for the purpose of section
Guidelines
110 of the Act, the gross revenues from these sales are $100.
Alternatively, if B sells the widget to a customer located in the United States for
$150 (instead of Canada), Corporation A will have gross revenues from sales
“from” Canada of $100, while B’s revenues are not “in”, “from” or “into” Canada.
Accordingly, there is no issue of duplication that could affect the section 109 and
110 thresholds, and no amounts may be deducted from gross revenues from sales.
As a result, the total gross revenues from sales for the purposes of determining
whether or not the section 109 threshold has been met (i.e., gross revenues from
sales “in, from or into” Canada) are $100. Likewise, the total gross revenues from
sales for the purposes of determining whether or not the section 110 threshold has
been met (i.e., gross revenues from sales “in or from” Canada generated from those
assets “in” Canada) are also $100.
Example Three
A is a Canadian corporation, while its subsidiary, B, is incorporated in the United
States. Corporation A loans Corporation B $100 million. The loan is recorded on
the financial statements of Corporation A as an asset, and is considered an asset in
Canada. However, the loan is recorded as “cash” on the financial statements of
Corporation B and would therefore be considered an asset in the United States.
Since the loan is an asset in Canada for Corporation A, and the cash is an asset in
the United States for Corporation B, there is no duplication.
543
If the cash was an asset in Canada because, in a different scenario, Corporation B

was a Canadian corporation, there would be duplication and the amount of the loan
could be deducted.

15: Assets in Canada and Gross Revenues From Sales in,
from or into Canada (Sections 109 and 110 of the Act)*
At the time of publication, the Competition Bureau had only made available a draft
Pre-Merger Notification Interpretation Guideline Number 15.
1. — Background
Section 114 of the Act requires parties to a proposed transaction that exceeds the
partysize and transaction-size thresholds under sections 109 and 110 of the Act,
respectively, to notify the Commissioner of the proposed transaction and supply the
prescribed information. To determine whether a proposed transaction exceeds the
party-size threshold under section 109 of the Act, the assets in Canada and the
gross revenues from sales in, from or into Canada (being domestic sales, exports
and imports) for all parties to the transaction, together with their affiliates z, must
be calculated. To determine whether the transaction-size threshold under section
110 of the Act is exceeded, the aggregate value of the assets in Canada being ac-
quired and the gross revenues from sales in or from Canada generated from those
assets must be calculated.
2. — Policy
The audited financial statements are the starting point for determining whether or
not an asset is “in” Canada or gross revenues from sales are “in, from or into”
Canada. In reviewing the audited financial statements of merging parties and their
affiliates, consideration should be given to the principles set out below. In addition,
while information in audited financial statements that is segmented by geographic
regions may be helpful in assessing whether a proposed transaction exceeds notifi-
cation thresholds, it is incumbent on parties to look beyond these segmented results
to ensure that threshold calculations are consistent with the requirements of the Act
and the Notifiable Transactions Regulations.
2.1 — Assets “in” Canada

Except as set out below, all assets on the audited financial statements of a Canadian
entity are assets “in” Canada. An entity is considered Canadian where it is incorpo-

544
rated in Canada or, in the case of an unincorporated entity, formed pursuant to a

Canadian statute.
2.1.1 — Tangible assets

Whether a tangible asset is an asset ‘in‘ Canada typically depends on where the
asset is physically located. In particular:
• An immovable tangible asset, such as a building or land that is located in Can-
ada is an asset in Canada, whereas if it is located outside of Canada it is not an
asset in Canada.
• A moveable tangible asset, such as inventory, equipment or vehicles of a Cana-
dian entity is considered to be “in” Canada, unless the asset was physically
located o utside Canada throughout the entire relevant fiscal period. Evidence
of location may include a record of registration in a foreign jurisdiction or a
log of where the asset was located throughout the entire relevant fiscal period.
• Where a moveable tangible asset of a foreign entity is physically located in
Canada at any time during the relevant fiscal period, parties are expected to
determine what proportion of the value of that asset is attributable to Canada,
and include that a mount in calculating the value of assets in Canada.
2.1.2 — Intangible assets
Guidelines
The location of an intangible asset, such as a copyright, trademark or patent, is
typically determined by the statute conferring the legal rights and privileges associ-
ated with the asset. In particular:
• An intangible asset with rights and privileges conferred pursuant to a Canadian
statute is an asset “in” Canada. For example, a Canadian patent is considered
to be a n asset in Canada, while a patent granted pursuant to a foreign statute is
not an asset in Canada. Where a group of patents that are registered in multiple
jurisdictions, including Canada, have a single value on the audited financial
statements, parties are expected to determine what proportion of that value of
that asset is attributable to Canada, and include that amount in calculating the
total value of assets in Canada.
• An intangible asset of a Canadian entity with legal rights and privileges that
are private or contractual in nature (i.e. (That is), that are not conferred by
statute) are assets in Canada.
• The goodwill of a Canadian entity is typically considered to be an asset in
Canada, u nless it can be demonstrated that the goodwill was generated by an
event that occurred outside Canada.
2.1.3 — Financial assets

The location of financial assets is typically determined by the statute conferring the
legal rights and privileges associated with that asset. In particular:
• A financial asset with rights and privileges conferred pursuant to a Canadian
statute is an asset “in” Canada, whereas a financial asset with rights and privi-
leges conferred pursuant to a foreign statute is not an asset in Canada.
545
• A financial asset of a Canadian entity with legal rights and privileges that are
private or contractual in nature (i.e., that are not conferred by statute) is an
asset in Canada. For example, loans or other types of receivables that are owed
to a Canadian entity by a foreign entity and cash held by the Canadian entity,
regardless of currency, are assets in Canada.
• Where an entity holds shares of another company, those shares are financial
assets and will be considered assets in Canada where the shares held are shares
of a Canadian company. Whereas, shares held in a foreign company (i.e., a
company incorporated in a foreign jurisdiction) are not assets in Canada.
2.2 — Gross revenues from sales “in, from or into” Canada

Merging parties should consider whether the audited financial statements provide a
reasonable approximation of the value of revenues “in”, “from” and/or “into” Can-
ada before relying on them in any particular case. For example, segmented sales
information reported i n the notes to audited financial statements often does not
reflect the allocation of sales revenues required for determining whether a proposed
transaction is notifiable under the Act. Reported Canadian sales may include sales
both “in” Canada and “into” Canada, and exclude sales “from” Canada. Particularly
in the case of consolidated audited financial statements that reflect sales in and
from multiple jurisdictions, it may be necessary to consult working papers or other
records to determine the value of sales “in or from” Canada or “in, from or into”
Canada.
Whether gross revenues from sales are considered to be “in, from or into” Canada
depends on the location of the seller and/or purchaser, which may correspond with
the jurisdiction of incorporation or, in the case of an unincorporated entity, the ju-
risdiction of its enabling statute. As such, whether gross revenues are from sales
“in, from or into” Canada can often be determined as follows:
• gross revenues from sales “in” Canada are those revenues from sales to a pur-
chaser located in Canada that are booked in the audited financial statements of
a Canadian party or Canadian affiliate of a party;
• gross revenues from sales “from” Canada are those revenues from sales to a
purchaser not located in Canada that are booked in the audited financial state-
ments of a Canadian party or Canadian affiliate of a party; and
• gross revenues from sales “into” Canada are those revenues from sales to a
purchaser located in Canada that are booked in the audited financial statements
of a foreign party or foreign affiliate of a party.
Where the jurisdiction of incorporation of the seller is not the origin of the sale, the
general principles set out above may not apply. For example, if the production and
sales o perations of a Canadian-incorporated seller are located exclusively outside
of Canada, its sales are not “in or from” Canada, even if those sales are reported on
its Canadian audited financial statements. Conversely, if a foreign-incorporated
company has production or sales operations in Canada, some or all of its sales may
be “in or from” Canada. Ancillary functions, such as human resources and pay ser-
vices, are typically not considered to be p art of production and sales operations.
546
The same principles apply when determining the location of the purchaser. For ex-
ample, revenues from sales by a foreign seller to a Canadian purchaser where pro-
duction and sales activity takes place outside Canada and the assets are delivered to
the purchaser’s facility located outside of Canada will not be considered to be sales
“into” Canada.
2.3 — “Generated from those assets”

When calculating the gross revenues from sales in or from Canada to determine the
transaction-size threshold under section 110 of the Act, only those gross revenues
from sales generated from those assets “in” Canada are relevant. Accordingly, if
the audited financial statements of a party to the proposed transaction have to be
adjusted, as a result of certain assets being considered either “in” or not “in” Can-
ada, the gross revenues from sales, as stated in the audited financial statements, that
correspond to such assets, may also have to be adjusted. If such adjustments to
gross revenues from sales are necessary, it is important to consult the appropriate
sections of the Notifiable Transactions Regulations.
Revenues are considered to be generated from assets in Canada if any of the
revenuegenerating assets of the target business are located in Canada. Revenue-
generating assets include assets that contribute in any way and at any stage (e.g.,
manufacture, sale) to the sale of the asset. Ancillary functions, such as human re-
sources and pay services, are typically not considered to be revenue-generating
Guidelines
assets.
3. — Examples
The examples below are hypothetical and are intended only to illustrate the gui-
dance outlined above. It is assumed for the purposes of these examples that the
transaction-size threshold under section 110 of the Act is $77 million.
Example one
Party B, a Canadian corporation, is proposing to acquire 100% of the voting shares
of Party A, a corporation incorporated in the United States. Party A’s production
facilities are located in the U.S.(U n ited States), but A also maintains a sales office
in Canada. Party A has $10 million in assets in Canada booked in its U.S.(United
States) audited financial statements; these assets are comprised of land, an office
building, a warehouse and some equipment and inventory. Party A has $200 mil-
lion in gross revenues from sales to Canadian customers booked in its U.S.(U n ited
States)audited financial statements.
For the purposes of determining whether or not the transaction-size threshold has
been met, Party A has a total of $10 million of assets “in” Canada. Regarding the
gross revenues from sales generated from those assets, the $200 million in gross
revenues from sales to Canadian customers would typically not be included in the
transaction-size calculation because these sales are booked in the audited financial
statements of a foreign party and, therefore, would not be considered to be gross
revenues from sales “in” or “from” Canada; however, in the present case, because
some of the revenue-generating assets that contribute to the $200 million in gross
547
revenues from sales to Canadian customers (i.e.(That is), some land, an office
building, a warehouse and some equipment and inventory) are physically located in
Canada, these sales are considered to be gross revenues from sales “in” Canada,
even though they are accounted for in the books of a foreign party. Accordingly,
the transaction-size threshold is met.
Example two
Party D, a Canadian corporation, is proposing to acquire 100% of the voting shares
of Party C, a U.S.(U n ited States)corporation that operates a cruise line. Party D
has assets i n Canada of $300 million booked in its Canadian audited financial
statements. Party C has an administrative office in Canada and two of its cruise
ships were present in Canada for approximately one month during its most recent
fiscal period. The two ships are registered in the U.S. (United States) and their book
value, as stated in Party C’s U.S. (United States) audited financial statements, is
$350 million.
For the purposes of determining whether the $400 million party-size threshold
under section 109 of the Act is met, given that the two ships were present in Can-
ada for one m onth during Party C’s most recent fiscal period, these ships are con-
sidered to be assets i n Canada. Accordingly, the section 109 threshold is met. For
the same reason, the transaction-size threshold is also met.

16: Definition of “Goods” (Paragraph 111(a) of the Act)*
Merger Notification Unit.34

548
This Guideline addresses the treatment of certain intangible assets, such as loans,
mortgages and receivables, for the purpose of the exemption for acquisitions in the
ordinary course of business (Paragraph 111(a) of the Act). This Guideline supple-
ments Pre-Merger Notification Interpretation Guideline Number 3: Exemptions for
Acquisitions in the Ordinary Course of Business (Paragraph 111(a) of the Act).
Background
Paragraph 111(a) of the Act provides that the following class of transaction is ex-
111. (a) an acquisition of real property or goods in the ordinary course of business if
the person or persons who propose to acquire the assets would not, as a result
of the acquisition, hold all or substantially all of the assets of a business or of
an operating segment of a business.
While the word “goods” is not defined in the Act, it is defined in different ways in
a number of other statutes. In some cases, its definition is limited to tangible pro-
perty, but in others it has a broader scope and includes some kinds of intangible
property. This indicates that the definition of goods depends on the context. The
Bureau considers that for the purpose of the paragraph 111(a) exemption, the word
“goods” includes intangible goods, as described below.
Guidelines
Policy
For the purpose of paragraph 111(a) of the Act, certain intangible assets such as
loans, mortgages and receivables, are considered to be goods. Therefore, the acqui-
sition of loans, mortgages and receivables may be exempt from the notification
requirements of Part IX of the Act if the requirements of paragraph 111(a) of the
Act are met.35
Example
The example below is hypothetical and is intended only to illustrate the Bureau’s
interpretation of this Guideline, as outlined above.
Facts
A is a motor vehicle manufacturer that sells its products in Canada through a deal-
ers’ network. B is a financial institution that currently provides financing services
to A’s dealers to allow these dealers to acquire inventory of motor vehicles, parts
and accessories. A and B are currently parties to a Dealer Finance Program Agree-
ment pursuant to which B provides commercial inventory finance services to A’s
dealers in Canada (the “Program”). A has given notice to B that it will not be re-
35 The reader should refer to Pre-Merger Notification Interpretation Guideline Number 3:

Exemptions for Acquisitions in the Ordinary Course of Business (Paragraph 111(a) of the
Act) for a detailed description of the two-step analysis required to determine whether the
paragraph 111(a) exemption applies to a particular proposed acquisition.
549
newing the Program past the expiry of its term and that it intends to exercise its
option to purchase the portfolio of accounts receivables arising from the Program
that will be outstanding at the end of its term (the “Accounts”). A and B have
reached an agreement concerning the acquisition of the Accounts (the “Transac-
tion”). After the Transaction is completed, A will offer financing services directly
to its dealers and B will continue to offer financing services to other motor vehicle
dealers.
Analysis
1) — Will the acquiror, as a result of the Transaction, hold all or
substantially all of the assets of a business or of an operating
segment of a business?
While it could be argued that providing asset-based financing, such as financing to
motor vehicle dealers, constitutes an operating segment of B’s business, B is only
selling the Accounts and will continue to offer asset-based financing, including mo-
tor vehicle financing services to other dealers, after the Transaction is completed.
Further, B is not transferring to A other key assets that would be required to operate
a standalone asset-based financing business, such as key personnel and proprietary
software normally required to service the Accounts. Therefore, the Transaction
does not constitute the acquisition of all or substantially all of the assets of an oper-
ating segment of a business.
2) — Is this an acquisition of real property or goods in the ordinary

course of business?
The Transaction is in the ordinary course of business as OEMs, such as A, switch
commercial finance providers for dealer programs from time to time and commer-
cial finance providers often buy and sell accounts receivable and loan portfolios
more generally. The Transaction results from A’s decision not to renew the Pro-
gram and to provide its own commercial inventory finance services to its dealer
network.
Conclusion
The Transaction meets the two parts of the test provided in paragraph 111(a) and is
therefore exempt from the notification requirements of Part IX of the Act.
Hostile Transactions Interpretation Guideline Number 1:

Bureau Policy on Disclosure of Information*
* Hostile Transactions Interpretation Guideline Number 1: Bureau Policy on Disclosure of

Information, Innovation, Science and Economic Development Canada, https://www.
competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03142.html. Reproduced with the permission
550
Policy
Generally, in providing information, including in the context of a hostile transac-
tion, the Bureau is guided by section 29 of the Competition Act (the “Act”) and the
enforcement policy and practice articulated in the Bureau’s Information Bulletin on
the Communication of Confidential Information Under the Competition Act (the
“Bulletin”). Section 29 protects information provided to or obtained by the Bureau,
including the identity of any persons who have provided it, subject to certain ex-
ceptions. In particular, this section provides for the communication of information
in four circumstances: to a Canadian law enforcement agency; for the purposes of
the administration or enforcement of the Act; where information has been made
public; or when authorized by the person who provided the information. Please
Guidelines
consult the Bulletin for further details on the scope and application of section 29 of
the Act.
The Act places limited obligations on the Bureau to disclose information to the
parties to a hostile transaction. Subsection 114(3) of the Act requires the Bureau to
immediately advise a target of the date upon which the Bureau receives a filing
from a bidder.
With respect to a non-hostile transaction, the Bureau is generally willing to provide
updates, where appropriate, on the progress of its review, speaking with counsel for
both parties, separately or together (as requested by the purchasing party). Typi-
cally, in such situations, the Bureau provides its complexity designation, the antici-
pated timing of its review, the date upon which the other party has certified com-
pleteness of any SIR response, the Bureau’s preliminary and final views on market
definitions and relevant section 93 factors, as developed, and its preliminary and
final conclusions regarding a potential prevention or lessening of competition col-
lectively, “Pertinent Information”). Having considered the sensitivities involved in
sharing information with both parties in a hostile transaction, the Bureau has deter-
of the Minister of Innovation, Science and Economic Development, 2020. The content of
this publication may be subject to change or may be removed from the Government website
without notice.
551
mined that, where it shares Pertinent Information with one party, it will strive to
disclose such Pertinent Information equitably to the other party, subject, in all
cases, to restrictions on the disclosure of confidential information defined by sec-
tion 29 of the Act.
The Bureau acknowledges that hostile transactions can give rise to particularly
complex considerations that may impact the straightforward application of the fore-
going policy on disclosure of Pertinent Information, including, for example, in cir-
cumstances involving multiple competing bids. Accordingly, the Bureau will be
mindful of such considerations in determining, on a case-by-case basis, how the
policy is applied.
Hostile Transactions Interpretation Guideline Number 2:

Bureau Policy on Running of Subsection 123(1) Waiting
Periods*
Background
The 1999 amendments to the Competition Act (“Act”) included the addition of sub-
section 114(3) to the pre-merger notification provisions to ensure that information
required from the target of an unsolicited or “hostile” takeover bid (“unsolicited
bid”) is received by the Competition Bureau (“Bureau”) sufficiently in advance of
the expiration of the statutory waiting period. Such timely filing of information
from all parties to a proposed acquisition assists the Bureau in reviewing the trans-
action as expeditiously as possible.
* Hostile Transactions Interpretation Guideline Number 2: Bureau Policy on Disclosure of

Information, Innovation, Science and Economic Development Canada, https://www.
competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03142.html. Reproduced with the permission
of the Minister of Innovation, Science and Economic Development, 2020. The content of
this publication may be subject to change or may be removed from the Government website
without notice.
552
In the context of an unsolicited bid, where the Commissioner of Competition

(“Commissioner”) receives notice and the prescribed information under subsection
114(1) of the Act from the bidder prior to receiving information from the corpora-
tion whose shares are being acquired (“target”), paragraph 114(3)(a) of the Act re-
quires the Commissioner to immediately notify the target that the prescribed infor-
mation has been received from the bidder. Paragraph 114(3)(b) of the Act requires
the target to supply the Commissioner with the prescribed information within 10
days after being so notified.
Where subsection 114(3) of the Act applies, subsection 123(3) of the Act provides
that the waiting periods referred to in subsection 114(1) shall be determined with-
out reference to the day on which the information required under section 114 is
received from the target (being either the prescribed information required pursuant
to subsection 114(1) or additional information required under subsection 114(2)).
Thus, the initial 30-day waiting period begins after the Commissioner has received
a complete notification from the bidder. Similarly, where supplementary informa-
tion requests (“SIRs”) are issued, the subsequent 30-day waiting period begins after
the Commissioner has received the information requested from the bidder and the
bidder has certified that its response is correct and complete in all material respects,
assuming the Bureau has not challenged the completeness of those responses. Ac-
cordingly, in the context of an unsolicited or hostile transaction, the target is not
able to affect the commencement of the relevant waiting period under subsection
Guidelines
123(1).
Policy
The applicability of subsections 114(3) and 123(3), respectively, requires that the
proposed transaction constitute an unsolicited bid when the relevant waiting period
under subsection 123(1) is to be commenced. If the proposed transaction does not
constitute an unsolicited bid at that time, the relevant waiting period in subsection
123(1) will apply, without impact from subsection 114(3).
For further clarity, where there is a change in status of an unsolicited bid such that
it is no longer unsolicited during the running of either waiting period under subsec-
tion 123(1), such change in status will have no effect on the running of that waiting
period (i.e., the applicable waiting period will not be halted or restarted owing to
the change in status of the transaction).
Discussion
1. Where a proposed transaction ceases to be an unsolicited bid within the initial
30-day waiting period.
Where subsection 114(3) of the Act applies at the time a bidder submits its pre-
merger notification filing, and during the initial 30-day waiting period the proposed
transaction ceases to be an unsolicited bid, the Bureau is of the view that this has no
effect on the running of this waiting period.
553
2. Where a proposed transaction ceases to be an unsolicited bid after the issuance

of a SIR, but prior to the bidder having certified completeness of its response to the
SIR.
At the time the bidder certifies completeness of its response to the SIR, the Bureau
will assess whether the proposed transaction is an unsolicited bid. If the Bureau is
of the view that it is, the subsequent 30-day waiting period will commence when
the bidder has certified that its response to the SIR is correct and complete in all
material respects in accordance with subsection 123(3), provided the Bureau has
not challenged the completeness of the response. However, where the Bureau deter-
mines that the proposed transaction is not an unsolicited bid at the time that the
bidder certifies completeness, the Bureau is of the view that subsections 114(3) and
123(3) are not applicable, and the subsequent 30-day waiting period does not com-
mence until all parties, including the target, have submitted certified complete re-
sponses to their respective SIR and the Bureau has not challenged the completeness
of any of those responses.
3. Where a proposed transaction ceases to be an unsolicited bid within the subse-
quent 30-day waiting period.
In the Bureau’s view, where a proposed transaction ceases to constitute an unsolic-
ited bid after the commencement of the subsequent 30-day waiting period under
paragraph 123(1)(b), this will have no effect on the running of that period.
554
COMPETITION BUREAU FEES AND
SERVICESTANDARDS HANDBOOK FOR
MERGERS AND MERGER-RELATED MATTERS*
Effective May 1, 2018
Preface
The Competition Bureau (“Bureau”) is an independent law enforcement agency re-
sponsible for, among other things, the administration and enforcement of the Com-
petition Act (“Act”). The Bureau contributes to the prosperity of Canadians by pro-
tecting and promoting competitive markets and enabling informed consumer
choice.
Since November 1997, the Bureau has required the payment of fees for the follow-
ing merger-related matters:
Guidelines
• pre-merger notification filings submitted pursuant to subsection 114(1) of the
Act (“notifications”);
• requests for Advance Ruling Certificates under section 102 of the Act (“ARC
requests”); and
• applications for written opinions under subsection 124.1(1) of the Act regard-
ing the applicability of Part IX (Notifiable Transactions) of the Act (“written
opinions”).
With the establishment of fees came challenging but attainable service standards.
These service standards, which are assigned based on the complexity of the compe-
tition issues raised by a proposed transaction, have been established to provide
timely and predictable merger review periods for stakeholders and to comply with
Treasury Board requirements with respect to the imposition of fees.
The purpose of this Handbook is to provide guidance as to how the Bureau deter-
mines the complexity of a proposed transaction that is the subject of a notification
or ARC request, and the complexity of a matter that forms the basis of a request for
a written opinion. This Handbook also sets out the information required by the Bu-
* Competition Bureau Fees and Service Standards Handbook for Mergers and Merger-
Related Matters (May 1, 2018), (Web Page Modified: 2020-04-01), Innovation, Science and
Economic Development Canada, https://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/
eng/04358.html. Reproduced with the permission of the Minister of Innovation, Science and
Economic Development, 2020. The content of this publication may be subject to change or
may be removed from the Government website without notice.
555
Competition Bureau Fees and Service Standards Handbook
reau to commence the applicable service standard, and explains when the service
standard may be paused and when it is satisfied. Finally, this Handbook provides
information with respect to the payment of fees.
The Bureau may revisit certain aspects of this Handbook in light of experience and
changing circumstances.
Table of contents
1. — Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 557
2. — Early consultation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 558

• 2.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 558
• 2.2 Merger Notification Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 558
3. — Notifications and ARC requests . . . . . . . . . . . . . . . . . . . . . . . . 558

• 3.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 558
• 3.2 Complexity designation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 559
• 3.2.1 The classification process . . . . . . . . . . . . . . . . . . . . . . . . . . . 559
• 3.2.2 Non-complex mergers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 560
• 3.2.3 Complex mergers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 560
• 3.3 Information required to commence the service standard . . . . . . . . 561
• 3.3.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 561
• 3.3.2 Non-complex mergers with no or minimal overlap . . . . . . . . 562
• 3.3.3 Non-complex mergers with moderate overlap . . . . . . . . . . . . 563
• 3.3.4 Complex and very complex mergers . . . . . . . . . . . . . . . . . . . 563
4. — Written opinions relating to Part IX of the Act . . . . . . . . . . . . . 564

• 4.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 564
• 4.2 Complexity definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 565
• 4.2.1 Non-complex written opinions . . . . . . . . . . . . . . . . . . . . . . . . 565
• 4.2.2 Complex written opinions . . . . . . . . . . . . . . . . . . . . . . . . . . . 565
• 4.2.3 Complexity designation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 565
5. — Service Standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 565

• 5.1 Service standard periods and commencement of the service standard
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 565
• 5.2 Market contacts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 567
• 5.3 Satisfaction of the service standard . . . . . . . . . . . . . . . . . . . . . . . . . 568
• 5.4 Pausing the service standard — requests for additional information . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 568
556
Introduction 1.
6. — Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 570
• 6.1 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 570
• 6.2 Refund policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 571
• 6.3 Withdrawing and re-submitting a notification (”pull and refile”) . . . 572
• 6.4 Photocopies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 572
7. — Review / feedback mechanisms . . . . . . . . . . . . . . . . . . . . . . . . 573
8. — How to contact the Competition Bureau . . . . . . . . . . . . . . . . . 574
1. — Introduction
The Competition Bureau Fees and Service Standards Policy for Mergers and
Merger-Related Matters (“Policy”) on which this handbook is based, is consistent
with the Government’s overall objective of fairness, which seeks to ensure that
those who benefit most from a service should pay for it, rather than forcing all
Canadians to pay through general taxation. The revised fee for merger notifications
and requests for ARCs comes into effect May 1, 2018.
Following amendments to the merger provisions of the Act and the Notifiable
Transactions Regulations (“Regulations”), updates to the existing service standards
Guidelines
and complexity designations for mergers and merger-related matters were made
and are discussed herein. Further, this Handbook clarifies what information is gen-
erally sufficient for the Bureau to assign complexity and commence the service
standard.
The existence of fees and related service standards has promoted a disciplined ap-
proach to identifying and measuring the Bureau’s performance. The Bureau is com-
mitted to ensuring that those who seek services, or are bound by regulatory require-
ments, have timely and predictable opportunities to provide input regarding fees
and service standards. To ensure that stakeholders have an opportunity to provide
feedback on the Policy and the Handbook, the Bureau holds public consultations
every two to three years. These consultations also provide the Bureau with an op-
portunity to report publicly on its performance.
To request clarification with respect to the services and regulatory processes out-
lined in this Handbook, or to ask a question regarding a particular merger issue,
please contact the Merger Notification Unit (“MNU”) at:
Merger Notification Unit
Mergers Directorate, Competition Bureau
50 Victoria Street
Telephone: 819-997-0615
Toll-free: 1-800-348-5358
Fax: 819-994-0998
557
1. Competition Bureau Fees and Service Standards Handbook
E-mail: ic.avisdefusionmergernotification.ic@canada.ca
The Bureau also offers several merger-related publications on its website, including
the Procedures Guide for Notifiable Transactions and Advance Ruling Certificates
Under the Competition Act (“Procedures Guide”) and the Merger Review Process
Guidelines, which may be consulted for guidance.
2. — Early consultation
2.1 — Overview
The Bureau’s approach to service standards is premised on cooperation from par-
ties and early, ongoing dialogue. The Bureau strongly encourages parties to a pro-
posed transaction to consult with the Bureau prior to, or as soon as possible after,
submitting a notification or an ARC request. Early consultation ensures that suffi-
cient information is submitted to facilitate complexity designation and thereby trig-
ger the commencement of the service standard period. This approach also enables
the Bureau to more readily focus its investigation, minimize any requests for addi-
tional information, and complete its review in a timely manner.
For transnational mergers that give rise to competition concerns in Canada and that
involve reviews by competition agencies in other jurisdictions, it is the Bureau’s
experience that early discussion on inter-agency cooperation is very useful. To fa-
cilitate this discussion, parties are strongly encouraged to provide foreign agencies
with waivers permitting them to share information with the Bureau as early in the
review process as possible.
2.2 — Merger Notification Unit1

The MNU is responsible for the receipt and initial processing of notifications and
ARC requests, as well as responding to requests for written opinions under section
124.1 of the Act relating to Part IX of the Act (Notifiable Transactions). The MNU
also provides non-binding oral assistance regarding the application and interpreta-
tion of Part IX. Parties are encouraged to contact the MNU if they are uncertain
about what information to provide to the Bureau to ensure that the service standard
is commenced without delay. Parties involved in matters that raise complex fact
scenarios or legal issues are encouraged to seek legal counsel.
3. — Notifications and ARC requests

3.1 — Overview
Service standards represent the maximum time within which the Bureau will en-
deavour to advise parties of the Bureau’s position in respect of a proposed transac-
tion that is the subject of a notification and/or an ARC request, assuming coopera-
tion from the parties. As required by the Policy, these proposed transactions will be
designated as “non-complex” or “complex,” and assigned the corresponding ser-
1 For further information regarding the MNU, please consult the Procedures Guide.
558
Notifications and ARC requests 3.
vice standard. The Bureau strives to ensure that its approach to merger review is as
transparent as possible, and will inform parties of the complexity designation
within 5 business days2 of receipt of sufficient information to assign complexity.
The complexity designation process and the information required to assign com-
plexity, and thereby commence the applicable service standard, are described in
greater detail below.
3.2 — Complexity designation

3.2.1 — The classification process
The senior case officer responsible for assessing a transaction is also responsible
for assigning complexity. The officer may consult with the Associate Deputy Com-
missioner, the Economic Analysis Directorate of the Bureau, market participants,
and/or outside experts before assigning complexity, particularly where a transaction
appears to be complex. In determining complexity, consideration will be given to
factors including product market, geographic market, market shares, effective re-
maining competition and barriers to entry, each of which is discussed in greater
detail below. To accurately assess these factors, the Bureau typically requires the
information set out in Section 3.3 of this Handbook, as applicable.
When providing information regarding relevant markets and market shares, the rel-
evant markets being analyzed for competitive effects may not necessarily corre-
Guidelines
spond to the product categories or service areas established by parties in the con-
duct of their business activities.3 Parties should consult the Bureau’s Merger
Enforcement Guidelines for guidance with respect to the Bureau’s approach to de-
termining relevant product and geographic markets. Where the relevant markets for
competition analysis are not clear, parties are encouraged to consider alternative
definitions and, to the extent possible, provide market share data (independent third
party data is preferable) and other relevant information for each of these
alternatives.
The Bureau will advise parties of the complexity level of a proposed transaction
and the applicable service standard within 5 business days of receiving a complete
notification or ARC request, provided that sufficient information has been submit-
ted to assign complexity. Parties should ensure that sufficient information to clas-
sify the transaction is provided to the Bureau concurrently with a notification
and/or ARC request. Parties with questions regarding what information should be
provided to the Bureau to commence the service standard are encouraged to consult
the MNU.
2 “business day” means any day that is not a holiday as defined in footnote 24 of this
Handbook.
3 See the Merger Enforcement Guidelines at paragraph 3.2.
559
3.2.2 — Non-complex mergers

Non-complex mergers are readily identifiable by the clear absence of competition
issues, and include transactions where there is no or minimal overlap between par-
ties, assuming properly defined product and geographic markets. Minimal overlap
includes a combined post-merger market share of less than 10% in any relevant
market.
Transactions with a combined post-merger market share of between 10% and 35%
may be considered non-complex or complex. Section 3.2.3 of this Handbook sets
out a number of complicating factors and, where one or more of these factors are
present, the transaction is more likely to be classified as complex. Where none of
these factors are present, the transaction is more likely to be classified as non-com-
plex. Most non-complex mergers are brought to the Bureau’s attention by way of
an ARC request. Between 2002 and 2010, approximately 88% of proposed transac-
tions subject to service standards were classified as non-complex.4
3.2.3 — Complex mergers

Complex mergers involve proposed transactions between competitors, or between
customers and suppliers, where there are indications that the transaction may, or is
likely to, create, maintain, or enhance market power, as described in the Merger
Enforcement Guidelines. Proposed transactions, where the combined post-merger
market share of the parties is potentially 35% or more, are generally classified as
complex. This category also includes certain proposed transactions where the com-
bined post-merger market share is less than 35% and one or more of the factors set
out below are present.
Factors that tend to indicate a complex merger include the following:
1. the definition of relevant markets is challenging;5
2. the merger is between participants in a concentrated industry;
3. the post-merger incremental increase in market share is not de minimis;
4. the existence of barriers to entry;
5. there are few effective remaining competitors;
6. the evaluation of the effectiveness of remaining competition or the assess-
ment of potential sources of new competition is difficult;
7. the existence of credible complaints or competitive concerns;
8. an efficiency exception or failing firm claim requires analysis; and
4 Transactions reviewed by the Bureau that are not the subject of either an ARC request or
notification are not subject to service standards.
5 Market definition can be challenging for many reasons, including determining the degree
of substitutability among differentiated products, or assessing the boundaries of geographic
markets where there are a number of plants or sales locations, etc.
560
9. cooperation and coordination with one or more foreign competition authori-

ties is required.
Vertical mergers may raise concerns when they increase barriers to entry or facili-
tate coordinated behaviour, as described in the Merger Enforcement Guidelines. In
a proposed transaction that raises vertical concerns, factors such as the possibility
of foreclosure or inequitable treatment will be considered a complicating factor that
will likely result in the transaction being classified as complex.
Complex mergers require a more in-depth review than is necessary for non-com-
plex mergers and, in some instances, may require significant analysis. Some com-
plex cases progress to the formal inquiry stage, require the issuance of a SIR, and
may require the use of formal powers under section 11 of the Act to collect infor-
mation from third parties. In such instances, the review generally requires a case
team comprised of Bureau officers, economists from the Economic Analysis Direc-
torate of the Bureau, legal counsel and outside experts.
3.3 — Information required to commence the service standard

3.3.1 — Overview
In the experience of the Mergers Directorate, the more comprehensive the informa-
tion provided by the parties at the initial stages of a matter, the more focused and
expeditious the review process becomes. This generally translates into more
Guidelines
targeted subsequent requests for information on the part of the Bureau, and fewer,
more focused third party contacts. Stakeholders benefit from a more timely resolu-
tion, and the Bureau has the opportunity to conduct an efficient and sufficiently
thorough examination of all relevant issues.
Parties to a proposed transaction may elect to supply the information required to
commence the service standard as part of an ARC request, or together with a notifi-
cation in the form of a substantive competitive impact submission, often referred to
as a competition brief.6
The Bureau is of the view that, generally, the information set out below is sufficient
to commence the applicable service standard; however, the Bureau recognizes that
specific information requirements may vary on a case-by-case basis. Where parties
choose not to provide the information suggested below with their notification or
ARC request, the Bureau is nonetheless likely to request this information or other
similar information to the extent that it is relevant. Such requests for additional
information will result in delays in commencing the service standard. Further, it is
incumbent on parties to a merger transaction to identify potential competition is-
sues and provide relevant information if they wish to obtain the benefit of an ARC
6 The prescribed information that must be submitted with a notification is set out in section
16 of the Regulations. For further details regarding the submission of a notification or ARC
request, please refer to the Procedures Guide.
561
or No-Action Letter.7 If parties are uncertain about the information that should be
provided to the Bureau, they are encouraged to consult the MNU or, where a notifi-
cation or ARC request has already been submitted, with the case officers assigned
to review the matter. Parties may optionally choose to provide their Business Num-
bers as part of the information supplied with an ARC request or notification. How-
ever, this is not information required to commence the service standard.
3.3.2 — Non-complex mergers with no or minimal overlap

For non-complex mergers with no or minimal overlap, the Bureau typically re-
quires the following information, as applicable, to assign complexity:
1. a description of the proposed transaction, including the proposed considera-
tion to be paid and received by each party (e.g. cash, assets, shares, interests);
2. the full name of each party to the proposed transaction;
3. a list of all affiliates, relevant for a competition analysis, of each party that
has significant assets in Canada or significant gross revenues from sales in,
from or into Canada;
4. a copy of each legal document, or the most recent draft of that document if
it has not yet been executed, that will be used to implement the proposed
transaction; and
5. a submission regarding relevant product and geographic market definitions,
along with a detailed explanation as to why the parties believe that there are
no or minimal competitive overlaps (horizontal or vertical) between the busi-
nesses of the parties, taking into consideration any:
1. significant affiliates,8
2. related businesses9 in which a party owns any interest; and
3. interlocking directorships.10
7 A No-Action Letter provides written confirmation that the Commissioner does not, at that
time, intend to make an application under section 92 of the Act in respect of the proposed
transaction.
8 For purposes of determining whether an affiliate or affiliates of a party can be excluded on
the basis of not being considered significant, the Bureau generally considers assets in Canada
or gross revenues from sales in, from or into Canada not to be significant if they are worth
$500,000 or less for each excluded affiliate and the total value of all of the excluded affili-
ates is $1,000,000 or less.
9 This includes any corporation, trust, partnership, joint venture or other business in which
the party owns a significant interest or that has a significant interest in the party.
10 Relevant interlocking directorships include interlocking directorships between and among
the merging parties or their affiliates and their competitors, customers and suppliers.
562
3.3.3 — Non-complex mergers with moderate overlap

For non-complex mergers with moderate overlap, the Bureau typically requires the
following information, as applicable, to assign complexity:
1. the information required by section 16 of the Regulations;
2. a submission regarding relevant product and geographic market definitions,
identification of all competitive overlaps (horizontal or vertical) between the
businesses of the parties, taking into consideration any:
1. significant affiliates,11
2. related businesses12 in which a party owns any interest; and
3. interlocking directorships,13 and a detailed explanation as to why the
parties believe there are no competition issues arising as a result of the
proposed transaction;
3. for each relevant product, in each relevant geographic market for the most
recently completed year:
1. independent third party data with respect to:
1. the total annual dollar sales, unit sales and capacity; and
2. market shares14 for each party and each competitor; and
2. if independent third party data is not available, the dollar sales, unit
Guidelines
sales and capacity for each party and estimated market shares for each
party and competitor, with an explanation of the basis for the estimates;
4. a list of the parties’ respective competitors; and
5. all co-production, joint venture or strategic alliance agreements with a com-
petitor in relation to any relevant product and having an effect on a relevant
geographic market.
3.3.4 — Complex and very complex mergers

For complex mergers, the Bureau typically requires the following information, as
applicable, to assign complexity:
1. the information listed in section 3.3.3 of this Handbook for non-complex
mergers with moderate overlap;
2. in respect of each party and each of its significant affiliates, for each rele-
vant product, in each relevant geographic market, all marketing, business and
strategic plans, and similar documents, that were prepared or received by an
11 See footnote 9.
12 See footnote 10.
13 See footnote 11.
14 Expressed in terms of dollar sales, unit sales, and capacity.
563
officer or director15 of the corporation; or, in the case of an unincorporated

entity, an individual who serves in a similar capacity, and that have been im-
plemented in Canada within the two years before the date of the notification or
ARC request16 or that are to be implemented in Canada;
3. in respect of each party and each of its significant affiliates, all offering
memorandum (or documents that served that function) evaluating or analysing
the proposed transaction with respect to market shares, competition, competi-
tors, markets, potential for sales growth or expansion into new products or
geographic regions produced within the two years before the date of the notifi-
cation or ARC request;
4. all non-compete agreements and other types of agreements, arrangements or
licences the parties may have with third parties that would have an impact on
the ability of actual or potential competitors to compete with the parties now
or in the future;
5. submissions regarding any relevant factors listed in section 93 of the Act;
and
6. a detailed explanation as to how prices are determined for each relevant
product in each relevant geographic market.
4. — Written opinions relating to Part IX of the Act

4.1 — Overview
Guidance regarding the applicability or interpretation of Part IX of the Act can be
obtained by requesting a binding written opinion from the Commissioner under
section 124.1 of the Act. Such requests should be directed to the MNU, and it is
recommended that parties contact the MNU prior to submitting a request. Written
opinions, which take into account previous written opinions, relevant jurispru-
dence, current policies and enforcement guidance, are binding on the Commis-
sioner as long as the facts of the matter remain substantially unchanged and the
transaction is carried out substantially as proposed.
The Bureau will not provide a written opinion under section 124.1 that requests an
assessment of the competitive effects of a proposed transaction under the merger
provisions of the Act. Parties to a proposed transaction seeking this kind of assess-
ment, regardless of whether the transaction is notifiable, must submit a notification
or an ARC request.
15 This includes all documents prepared or received by an officer or director in a position

that is either
1. provided for in the bylaws or articles of the company or
2. appointed by the Board (or persons exercising similar functions in non-corporate
entities).
16 Which shall be the date that the notification or ARC request has been determined to be
complete by the MNU.
564
Service standards 5.
A request for a written opinion regarding the applicability or interpretation of Part

IX of the Act should clearly state the question and provide, among other things:
1. a description of the parties;
2. a description of the proposed transaction, broken down by its component
steps; and
3. all material facts relevant to the request.
4.2 — Complexity definitions

4.2.1 — Non-complex written opinions
Non-complex written opinions regarding the applicability or interpretation of Part
IX of the Act, or the Regulations, typically involve established Bureau policy
and/or jurisprudence that would enable the Bureau to readily formulate an opinion.
4.2.2 — Complex written opinions

Complex written opinions regarding the applicability or interpretation of Part IX of
the Act, or the Regulations, typically involve novel issues and, consequently, no
established Bureau policy, procedures, and/or jurisprudence on the subject.
4.2.3 — Complexity designation
Guidelines
Upon receipt of sufficient information, parties will be informed within 5 business
days of the complexity level and applicable service standard.
5. — Service standards
5.1 — Service standard periods and commencement of the service
standard
deavour to advise parties of the Bureau’s position in respect of a particular transac-
tion assuming cooperation from the parties. The Bureau aims to provide a response
to notifications, ARC requests and requests for written opinions within the service
standard periods, which are based on calendar days, set out in Table 1 below. The
Bureau’s obligation to comply with service standards is contingent upon coopera-
tion from the parties during the course of an examination.
For non-complex mergers, the service standard is 14 calendar days, commencing
the day a complete notification or ARC request is received by the Commissioner,17
assuming sufficient information is provided with the notification or ARC request to
assign complexity.
For complex mergers, the service standard is 45 calendar days, commencing the
day on which a complete notification or ARC request is received by the Commis-
17 The Commissioner will receive notifications and ARC requests during business hours on
any day that is not a holiday, as set out in footnote 24 of this Handbook.
565
sioner, assuming sufficient information is provided with the notification or ARC

request to assign complexity. However, where a SIR is issued, the service standard
is 30 calendar days and commences the day on which the Commissioner has re-
ceived a complete response to the SIR from all SIR recipients. The service standard
for complex mergers that are subject to a notification will, in all events, better align
with the statutory waiting period, provided parties submit sufficient information to
designate complexity with the notification and the service standard is not paused.
Where a SIR is issued, the service standard and statutory waiting period will be
directly aligned.18 In the case of a proposed transaction to which subsection 114(3)
of the Act applies (“unsolicited bid”), the service standard will commence when all
parties other than the target corporation have complied with the applicable require-
ments above.
For written opinions, the service standard is 14 calendar days for non-complex mat-
ters and 28 calendar days for complex matters, commencing the day on which suf-
ficient information has been received by the Commissioner to assign complexity.
Where a service standard ends on a holiday,19 it will be deemed to end on the next
day that is not a holiday to align with the treatment of statutory waiting periods that
end on a holiday.
Table 1: Service standards for notifications, ARC requests and written
opinions
Service
Service or Standard
Regulatory (calendar Commencement of Service
Process days) Standard*
Merger Non-complex 14 days The day on which sufficient informa-
Notifica- tion has been received by the Com-
tion Fil- missioner to assign complexity. See
ings and the information set out in sections
ARC 3.3.2 and 3.3.3 of this Handbook.
Requests
18 Where all parties have certified compliance with a SIR and the Commissioner does not
dispute compliance, the applicable service standard will not be paused.
19 As specified in the Procedures Guide, “holiday” means any of the following days: Satur-
day, Sunday, New Year’s Day, Good Friday, Easter Monday, Victoria Day, Quebec National
Holiday (June 24th), Canada Day, Labour Day, Thanksgiving, Remembrance Day, Christ-
mas Day and Boxing Day. Furthermore, if New Year’s Day, June 24th or Canada Day fall
on a Sunday, the following Monday is considered to be a holiday.
566

opinions
Service
Service or Standard
Regulatory (calendar Commencement of Service
Process days) Standard*
Complex 45 days, The day on which sufficient informa-
except tion has been received by the Com-
where a missioner to assign complexity; or
SIR is is- where a SIR is issued, the day on
sued, in which the information requested in
which the SIR has been received by the
case it Commissioner from all SIR recipi-
shall be ents. See the information set out in
30 days section 3.3.4 of this Handbook.
Part IX Non-complex 14 days The day on which sufficient informa-
Written tion has been received by the Com-
missioner to assign complexity.
Opinions Complex 28 days See the information set out in section
4.1 of this Handbook.
Guidelines
Notes:
* In the case of an unsolicited bid under subsection 114(3), the service standard
will commence when all parties other than the target corporation have com-
plied with the applicable requirements.
5.2 — Market contacts

It is standard practice in merger reviews for the Bureau to communicate with mar-
ket participants, including customers, suppliers, and competitors of the merging
parties. Even for a non-complex merger with no or minimal overlap, unless it is
very clear that there is no need to go to the market, the Bureau will make at least
some market contacts. The Bureau must be in a position to obtain information from
market participants to properly assess a proposed transaction, including verification
of the information supplied by the parties. The applicable service standard or statu-
tory waiting period will not commence until such time as the Bureau is able to
conduct market contacts.
In all events, on receipt of a notification that complies with statutory require-
ments20 and thereby triggers the statutory waiting period, the Bureau will continue
its practice of making market contacts if and when the Bureau considers it neces-
sary. Notice will not be given to parties that the Bureau intends to commence mar-
ket contacts, as confirmation from the Bureau that a notification complies with stat-
20 Please refer to the Procedures Guide.
567
utory requirements, and that the statutory waiting period has commenced,
constitutes notice to the merging parties that market contacts will be made, if and as
necessary. Parties that intend to submit a notification, but would like to have mar-
ket contacts deferred, may consider submitting a draft notification that does not
meet the statutory requirements. Subject to the Commissioner’s obligations under
the Act, the Bureau will normally agree to defer making market contacts as long as
there would be sufficient time before closing to make necessary contacts and par-
ties have not triggered a statutory waiting period with the submission of a complete
notification. In this situation, parties must appreciate that the statutory waiting pe-
riod and the applicable service standard will not commence until the statutory re-
quirements and the requirements in this Handbook, respectively, are satisfied.
Where the Bureau decides not to defer making market contacts, it will first notify
the parties.
5.3 — Satisfaction of the service standard

The service that is the subject of the service standard is considered to have been
provided when the parties are either:
1. issued an ARC or a No-Action Letter; or
2. advised that, without a remedy, the proposed transaction is likely to prevent
or lessen competition substantially.21 The time devoted to discussions or ne-
gotiations aimed at resolving issues, the preparations required for proceedings
before the Competition Tribunal (“Tribunal”), and the time required to con-
duct proceedings before the Tribunal are not included within the service
standards.
For written opinions, the service is provided when the opinion has been mailed to
the applicant and/or the party receives oral confirmation from the MNU followed
by the written response.
5.4 — Pausing the service standard — requests for additional

information
In the vast majority of non-complex mergers, the information requirements set out
in this Handbook will not only be sufficient for the Bureau to commence the ser-
vice standard, but also to complete its assessment of a proposed transaction; how-
ever, depending on the specific circumstances of the case, and certainly for more
complex mergers, the Bureau may require additional information from the parties
in order to complete its review. For less complex mergers, or complex mergers
where the Bureau requires additional information to determine the necessity or
scope of a SIR, such additional information will generally be sought on a voluntary
21 In situations where parties approach the Bureau with a proposed remedy, the Bureau will
nonetheless complete its analysis to determine whether the proposed transaction is likely to
prevent or lessen competition substantially. Accordingly, the service standard will have been
met in the same circumstances as described above.
568
basis. Alternatively, the parties and the Bureau may have an understanding (as may
be embodied in a timing agreement)22 that:
1. the Bureau is continuing its review beyond the expiry of any applicable
statutory waiting period;
2. the parties will work cooperatively with the Bureau to address additional
information requests from the Bureau; and
3. the parties will not close the transaction for an agreed-upon period of time
to allow the Bureau to complete its review.
Where the Bureau has made a written request for additional information from one
or more of the parties to a proposed transaction, or from a party requesting a writ-
ten opinion after the commencement of the service standard period, and such addi-
tional information is not received within the response time set out in Table 2 below,
the Bureau may, on the following day, pause the service standard period. Upon
receipt of the information, the service standard period will resume. Parties will be
notified in writing when the service standard period has been paused and when the
service standard period has resumed, together with the new service standard end
date. Table 2 sets out the maximum number of business days within which a re-
sponse to an information request must be received to avoid having the applicable
service standard paused.
Table 2: Period within which parties must respond to information
Guidelines
requests
Service or Response
Regulatory Process Time*
Merger Notification Filings and Non-complex 3 days
ARC
Requests Complex 5 days
Part IX Written Opinions Non-complex 3 days
Complex 5 days
Notes:
* Response time is calculated in business days.
22 Pursuant to section 5 of the Treasury Board Policy on Service Standards for External
Fees, where parties enter into a formal timing agreement with the Bureau that stipulates a
service standard (or some equivalent provision), the service standards set out in the Hand-
book are not applicable. For more information regarding timing agreements, please refer to
the Merger Review Process Guidelines.
569
6. — Fees
6.1 — Fees
Fees for notifications and ARC requests should be submitted at the time the request
or filing is made.23 In the case of an ARC request, the person making the request is
responsible for payment. In the case of a notification, the notifying parties should
pay the fee. However, while the parties are free to make their own arrangements as
to payment, the Bureau considers all notifying parties to be jointly and severally
liable.24
Fees for written opinions should be submitted at the time the application is made.
The person making the request is responsible for payment. Only one fee applies to
a written opinion that might involve the review of multiple sections of the Act. The
Bureau will continue to charge $50 to charitable organizations.25
Payments may be made by wire transfer26 or by cheque payable to the Receiver
General for Canada. Written opinions are subject to the federal and provincial taxes
indicated in Table 3 below.
Note that the fee for notifications and ARC Requests is subject to an annual
Consumer Price Index adjustment. The Bureau will announce the adjusted fee
annually.
Table 3: Fees and applicable taxes27 for merger notification filings, ARC
requests and written opinions
Service or Regulatory Notification28ARC Written Opinion
Process Request
Québec $75,055.68 $75,055.68 $5,000.00 + GST
($250.00) + QST
($498.75)
Total = $5,748.75
Nova Scotia, New Bruns- $75,055.68 $75,055.68 $5,000 + HST
wick, ($750.00)
Newfoundland and Labra- Total= $5,750.00
dor,
Prince Edward Island
Ontario $75,055.68 $75,055.68 $5,000.00 + HST
23 The failure to provide payment with a notification or ARC request will not affect the
commencement of the service standard or the statutory waiting period.
24 Except where a party is required to notify pursuant to section 114(3), in which case, that
party is not liable for the payment of the fee.
25 The Income Tax Act’s definition of a charitable organization will be used to determine the
applicability of this exception.
26 For further information regarding wire transfers, parties should contact the MNU.
570
Fees 6.
Table 3: Fees and applicable taxes27 for merger notification filings, ARC
requests and written opinions
Service or Regulatory Notification28ARC Written Opinion
Process Request
($650.00)
Total = $5,650.00
British Columbia $75,055.68 $75,055.68 $5,000.00 + GST
($250.00) + PST
($350.00)
Total = $5,600.00
Saskatchewan $75,055.68 $75,055.68 $5,000.00 + GST
($250.00) + PST
($300.00)
Total = $5,550.00
Manitoba $75,055.68 $75,055.68 $5,000.00 + GST
($250.00) + PST
($400.00)
Total = $5,650.00
Guidelines
Alberta and Territories $75,055.68 $75,055.68 $5,000.00 + GST
($250.00)
Total = $5,250.00
Notes:
27 Only Canadian residents pay Canadian taxes, which are current to the date of
publication of this Handbook.
28 Where both a notification and an ARC request are submitted with respect to
the same proposed transaction, only one fee applies.
6.2 — Refund policy

Upon written request by the party who submitted the fee, refunds will be provided
where:
1. a notification is withdrawn within two business days of receipt by the
Bureau;
2. an ARC request is withdrawn within two business days of its receipt by the
Bureau, if the Bureau has not issued an ARC or a No-Action Letter;
3. both a notification and an ARC request are submitted in respect of the same
transaction, and both the notification and the ARC request are withdrawn
within two business days of receipt by the Bureau of the earlier of the notifica-
tion or ARC request;
4. the Bureau exercises its discretion to not provide a written opinion within
fourteen days of receipt of the written opinion request;
571
5. the request for a written opinion is withdrawn within two business days of
receipt of the request by the Bureau; or
6. the Bureau identifies or is notified of an over-payment within one year of
the date the notification, ARC request or written opinion request was received
by the Bureau. In these cases, the refund will only apply to the over-payment.
6.3 — Withdrawing and re-submitting a notification (“pull and refile”)

If, during the initial waiting period under subsection 114(1) of the Act, a notifica-
tion is withdrawn more than two business days after it was initially received and
the parties subsequently resubmit a notification in respect of the same proposed
transaction (“Subsequent Notification”), no fee will be required for the Subsequent
Notification if the following conditions are met:
1. the Subsequent Notification, specifically as it relates to the prescribed infor-
lations, is current as of the date it is received by the Bureau;
2. the Subsequent Notification is certified pursuant to section 118 of the Act;
3. the Subsequent Notification is received by the Bureau within five business
4. there has been no material change in respect of the proposed transaction;
and
5. it is the first Subsequent Notification.
If these conditions are not met, the Subsequent Notification will be considered a
fresh notification that is subject to the applicable fee and service standards. Where
the above conditions are met, the service standard will, regardless of whether an
ARC request has also been received in respect of the same transaction, recom-
mence when the Subsequent Notification is received, assuming it meets the criteria
set out above, to best align the service standard period with the statutory waiting
period.
6.4 — Photocopies
Fees for photocopies apply to requests for copying services made to the Bureau.
Payments may be made by VISA, MasterCard, wire transfer27 or by cheque paya-
ble to the Receiver General for Canada. Photocopies will be subject to a fee of
27 For further information regarding wire transfers, parties should contact the MNU.
572
Review / feedback mechanisms 7.
$0.25 per page and are subject to the federal and provincial taxes set out in Table 4.
The fee is payable once the work has been completed.
Table 4: Fees and applicable taxes30 for photocopies
Service or Regulatory Process Photocopies
Québec $0.25 + GST ($0.01) + QST
($0.03)
Total = $0.29 per page
Nova Scotia, New Brunswick, $0.25 + HST ($0.04)
Newfoundland and Labrador, Prince Ed- Total = $0.29 per page
ward Island
Ontario $0.25 + HST ($0.03)
British Columbia $0.25 + GST ($0.01) + PST
($0.02)
Saskatchewan $0.25 + GST ($0.01) + PST
($0.02)
Guidelines
Manitoba $0.25 + GST ($0.01) + PST
($0.02)
Alberta and Territories $0.25 + GST ($0.01)
Notes:
30 Only Canadian residents pay Canadian taxes, which are current to the date of
publication of this Handbook.
7. — Review / feedback mechanisms

Parties submitting a notification, ARC request, or written opinion request are in-
vited to provide feedback to the Bureau by completing the brief evaluation leaflet
enclosed with each response to a request for service. Completed leaflets should be
mailed to the Bureau’s Corporate Services Branch, which prepares reports for the
Mergers Directorate to ensure the anonymity of the respondents’ feedback to the
Bureau.
Complaints regarding services and regulatory processes for which fees and service
standards apply can be directed to the Executive Director, Corporate Services
Branch. The Executive Director will examine the matter and will provide feedback
to the complainant.
573
Contact information for the Executive Director, Corporate Services Branch, is:
Executive Director, Corporate Service Branch
Competition Bureau
50 Victoria Street
Phone: 819-997-3763
Facsimile: 819-953-1877
On application, any resolution deemed by the complainant to be unsatisfactory will
be further investigated by the Commissioner. Complainants will receive feedback
and information regarding any subsequent resolutions or decisions relating to the
original complaint.
Contact information for the Commissioner is:
Competition Bureau
50 Victoria Street
Telephone: 819-997-5300
Facsimile: 819-953-5013
All complaints will be handled in the strictest confidence.
8. — How to contact the Competition Bureau

Website
Address
Information Centre
Competition Bureau
50 Victoria Street
Telephone
Toll-free: 1-800-348-5358
TTY (for hearing impaired): 1-866-694-8389
Facsimile
574
How to contact the Competition Bureau 8.
819-997-0324
Date modified:
2020-04-01
Guidelines
575
COMPETITION BUREAU FEES AND SERVICE
STANDARDS POLICY FOR MERGERS AND
MERGER-RELATED MATTERS*
May 2018
Table of Contents
1. — Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 578
2. — Mergers branch services and regulatory processes for which fees

apply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 579
• 2.1 Pre-merger notification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 579
• 2.2 Advance Ruling Certificates (“ARCs”) . . . . . . . . . . . . . . . . . . . . . . 580
Guidelines
• 2.3 Written opinions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 580
• 2.4 Photocopies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 581
3. — Consultations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 581
4. — Fees and service standards . . . . . . . . . . . . . . . . . . . . . . . . . . . 581
5. — Refund policy for notifications, ARC requests and written

opinions under Part IX of the Act . . . . . . . . . . . . . . . . . . . . . . . . . 583
6. — Withdrawing and re-submitting a notification (“pull and refile”)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 584
7. — Review mechanisms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 584
* Competition Bureau Fees and Services Standards Policy for Mergers and Merger-Related
Matters, (May 2018), (Web Page Modified: 2020-04-01), Innovation, Science and Economic
577
Competition Bureau Fees and Service Standards Policy
1. — Introduction
choice.
This Competition Bureau Fees and Service Standards Policy for Mergers and
Merger-Related Matters (“Policy”) contains fees and service standards that are
consistent with the government’s overall objective of fairness, with fees that ensure
that those who benefit most from a service should pay for it, rather than have all
Canadians pay through general taxation, and service standards that are relevant to
stakeholders.
This Policy supersedes the October 2010 Policy.
In 2018, the fee for merger notifications and requests for ARCs was revised, and
the revised fee comes into effect May 1, 2018. In revising the fee, a thorough cost-
ing analysis was undertaken in accordance with the Treasury Board of Canada Sec-
retariat’s Guidelines on Costing. Additionally, a pricing analysis in accordance
with the Treasury Board of Canada Secretariat’s Guide to Establishing the Level of
a Cost-Based User Fee or Regulatory Charge was used in setting the fee. The fac-
tors considered include the private and public benefit of the service, the impact of
the fee on stakeholders, the public policy objectives associated with the fee, stake-
holder consultations, and international comparisons. The Service Fee Act requires
that departments and agencies establish a mechanism for remitting fees when ser-
vice standards are not met. Guidelines on remissions are being developed by Inno-
vation, Science and Economic Development Canada and the Treasury Board of
Canada Secretariat.
In 2009, amendments to the merger provisions of the Act created a two-stage pro-
cess for reviewing mergers in Canada, which resulted in changes to the statutory
waiting periods for parties required to notify the Commissioner of Competition
(“Commissioner”) of a proposed transaction. Following public consultations in
2010, the service standards set out herein were introduced in the October 2010 ver-
sion of this Policy.
The use of fees and related service standards has promoted a disciplined approach
to identifying and measuring the Bureau’s performance. The Bureau is committed
to ensuring that those who seek services, or are bound by regulatory requirements,
have timely and predictable opportunities to provide input regarding fees and ser-
vice standards. To ensure that stakeholders have an opportunity to provide feed-
back on the Policy and the Competition Bureau Fees and Service Standards Hand-
book for Mergers and Merger-Related Matters (“Handbook”), the Bureau holds
public consultations every two to three years. These consultations also provide the
Bureau with an opportunity to report publicly on its performance.
For further information related to implementation of this Policy, please consult the
Handbook.
578
2. — Mergers branch services and regulatory processes for which fees

apply
2.1 — Pre-merger notification
Part IX of the Act sets out the statutory framework for pre-merger notification
(“notification”), which requires parties to proposed transactions that exceed certain
monetary thresholds (and, where applicable, shareholding or interest-holding
thresholds), unless an exemption is available, to:
a. notify the Commissioner prior to completing the proposed transaction;
b. provide specified information; and
c. wait a specified period of time before completing the transaction.
Pursuant to paragraph 123(1)(a) of the Act, parties are legally prohibited from clos-
ing the transaction for an initial 30-day waiting period, unless the Commissioner
notifies the parties that the he does not intend, at that time, to make an application
under section 92 of the Act in respect of the proposed transaction (such notice is
commonly referred to as a “No-Action Letter”).
During the initial 30-day waiting period, the Commissioner may, pursuant to sub-
section 114(2), require a notifying party to supply additional information that is
relevant to the assessment of the proposed transaction. The issuance of a supple-
mentary information request (“SIR”) triggers a second 30-day waiting period that
Guidelines
commences only once the Commissioner has received from each SIR recipient a
complete response to all information requests set out in the SIR.1 A proposed trans-
action may not close until the expiry of this second waiting period, subject to the
receipt of a No-Action Letter.
Also, pursuant to section 100 of the Act, upon application by the Commissioner,
the Competition Tribunal (“Tribunal”) may issue an interim order prohibiting the
completion of the transaction.
2.2 — Advance Ruling Certificates (“ARCs”)

Parties to a proposed transaction may apply for an ARC in lieu of, or in addition to,
submitting a notification. Pursuant to section 102 of the Act, where the Commis-
sioner is satisfied by a party or parties to a proposed transaction that there are insuf-
ficient grounds to apply to the Tribunal for a remedial order under section 92, the
Commissioner may issue an ARC.2 The issuance of an ARC is discretionary; how-
1 In the case of an unsolicited bid, the second 30-day waiting period begins upon the date
when the Commissioner receives the requested information from the bidder, without refer-
ence to the date upon which the target complies with a SIR. This is intended to prevent the
target from delaying the completion of the unsolicited bid by failing to comply with a SIR in
a timely manner.
2 Where parties to a transaction require approval from agencies other than the Bureau prior
to closing their transaction, the issuance of an ARC does not derogate from the need to
obtain these other approvals.
579
ever, an ARC cannot be issued for a transaction that has been completed. Where an
ARC is issued, paragraph 113(b) of the Act exempts the named transaction from
the notification provisions of Part IX of the Act.
Under section 103 of the Act, where the Commissioner issues an ARC and where
the proposed transaction to which the ARC relates is substantially completed within
one year after the ARC is issued, the Commissioner cannot apply to the Tribunal
solely on the basis of information that is the same or substantially the same as the
information upon which issuance of the ARC was based; however, where the Com-
missioner receives additional information that differs from the basis upon which the
ARC was issued, the Commissioner may apply to the Tribunal for an order under
section 92 of the Act. Thus, it is critical that parties provide full disclosure of all
information relevant to the proposed transaction and its effect on competition at the
time an ARC is requested.
2.3 — Written opinions

Guidance regarding the applicability or interpretation of Part IX of the Act can be
obtained by requesting a binding written opinion from the Commissioner under
section 124.1 of the Act. Written opinions, which take into account relevant juris-
prudence, previous written opinions, current policies and enforcement guidance,
are binding on the Commissioner as long as the facts of the matter remain substan-
tially unchanged and the transaction is carried out substantially as proposed.
The Bureau will not provide a written opinion under section 124.1 that requests an
assessment of the competitive effects of a proposed transaction under the merger
provisions of the Act. Parties to a proposed transaction seeking this kind of assess-
ment, regardless of whether the transaction is notifiable, must submit a notification
and/or an ARC request.
2.4 — Photocopies
Fees for photocopies apply to requests for copying services made to the Bureau.
3. — Consultations
Most recently in 2017, the Bureau sought the input of interested parties on its pro-
posed increased merger filing fee. The Bureau organized consultations with stake-
holders in two phases. In the first phase, the Bureau held a consultation meeting
with members of the Canadian Bar Association (“CBA”) and conducted in-person
consultation sessions with stakeholders in Toronto, Ontario and Montreal, Quebec.
Stakeholders invited to the consultations included consumer groups and industry
associations from the real-estate, oil and gas, manufacturing, grocery, telecommu-
nications and retail sectors. In the second phase of the consultations, the fee propo-
sal was posted on the Bureau’s external website for public comment from October
20, 2017 to November 20, 2017. During this phase, the Bureau issued an Informa-
tion Notice on the fee proposal and publicized the proposal on its social media
pages. The feedback received was considered, as well as applicable government
policies and priorities.
580
The service standards and written opinions set out in this Policy were developed
following comments received during the June 2007 Merger Forum, and consulta-
tions at the CBA Merger Roundtable in January 2010. A draft Handbook was
posted on the Bureau’s website in May 2010, and the Mergers Directorate also held
a Fees and Service Standards Forum later that month in Toronto. The comments
received through these consultations were considered, and many continue to be re-
flected in this Policy and the related Handbook. Stakeholders consulted included
members of the legal and business communities.
4. — Fees and service standards

The revised fee for notifications and ARC requests comes into effect May 1, 2018.
Fees for written opinions that came into effect on April 1, 2003 remain unchanged.
Where a merger notification in respect of a proposed transaction is withdrawn and
subsequently re-submitted, parties will not be required to pay the fee upon re-sub-
mission, provided certain conditions, which are described in Part 6 (Withdrawing
and Re-Submitting a Notification), are met. The policy with regard to withdrawing
and re-submitting a notification came into effect November 1, 2010.
deavour to advise parties of its position in respect of a proposed transaction, assum-
ing cooperation from the parties. The service standards for notifications and ARC
requests, which are based on calendar days, have been revised as set out in Table 1
Guidelines
below. The revised service standards come into effect November 1, 2010.
opinions
Service
Service or Standard
Regulatory (calendar
Process days) Commencement of Service Standard*
Merger Notification Filings and ARC Requests
Non-com- 14 days The day on which sufficient information has
plex been received by the Commissioner to assign
complexity. See the information set out in sec-
tions 3.3.2 and 3.3.3 of the Handbook.
Complex 45 days, ex- The day on which sufficient information has
cept where a been received by the Commissioner to assign
SIR is is- complexity; or, where a SIR has been issued,
sued, in the day on which the information requested in
which case it the SIR has been received by the Commission-
shall be 30 er from all SIR recipients. See the information
days set out in section 3.3.4 of the Handbook.
Part IX Written Opinions
Non-com- 14 days The day on which sufficient information has
plex been received by the
581

opinions
Service
Service or Standard
Regulatory (calendar
Process days) Commencement of Service Standard*
Commissioner to assign complexity. See the
information set out
Complex 28 days in section 4.1 of the Handbook.
Notes:
* In the case of an unsolicited bid under subsection 114(3), the service standard
will commence when all parties other than the target corporation have com-
plied with the applicable requirements.
Fees for notifications and ARC requests should be submitted at the time the request
or filing is made.3 In the case of an ARC request, the person making the request is
responsible for payment. In the case of a notification, the notifying parties should
pay the fee. However, while the parties are free to make their own arrangements as
to payment, the Bureau considers all notifying parties to be jointly and severally
liable.4
Fees for written opinions should be submitted at the time the application is made.
The person making the request is responsible for payment. Only one fee applies to
a written opinion that might involve the review of multiple sections of the Act. The
Bureau will continue to charge $50 to charitable organizations.5
Payments may be made by wire transfer6 or by cheque payable to the Receiver
General for Canada. Payments for photocopying services may also be made by
VISA or MasterCard. Written opinions and photocopying services are subject to
federal and provincial taxes as indicated in Table 2 below.
Table 2: Fees for merger notification filings, ARC requests, written
opinions and photocopies
Service or Regulatory Process Fee
Notification $75,055.68*
ARC Request $75,055.68*
3 The failure to provide payment with a notification or ARC request, however, will not affect
the commencement of the service standard or the statutory waiting period.
4 Except where a party is required to notify pursuant to subsection 114(3), in which case,
that party is not liable for the payment of the fee.
5 The Income Tax Act’s definition of a charitable organization will be used to determine the
applicability of this exception.
6 For further information regarding wire transfers, parties should contact the Merger Notifi-
cation Unit.
582
Table 2: Fees for merger notification filings, ARC requests, written

opinions and photocopies
Service or Regulatory Process Fee
Written Opinion $5,000**
Photocopies $0.25**
Notes:
* Where both a notification and an ARC request are submitted with respect to
the same proposed transaction, only one fee applies. The fee is subject to an
annual Consumer Price Index adjustment. The Bureau will announce the ad-
justed fee annually.
** Requests for written opinions and photocopying services are subject to appli-
cable federal and provincial taxes; only Canadian residents pay Canadian
taxes.
5. — Refund policy for notifications, ARC requests and written

opinions under Part IX of the Act
Upon written request by the party that submitted the fee, refunds will be provided
where:
a. a notification is withdrawn within two business days of receipt by the
Guidelines
Bureau;
b. an ARC request is withdrawn within two business days of its receipt by the
Bureau, if the Bureau has not issued an ARC or a No-Action Letter;
c. both a notification and an ARC request are submitted in respect of the same
transaction, and both the notification and the ARC request are withdrawn
within two business days of receipt by the Bureau of the earlier of the notifica-
tion or ARC request;
d. the Bureau exercises its discretion to not provide a written opinion within
fourteen days of receipt of the written opinion request;
e. the request for a written opinion is withdrawn within two business days of
receipt of the request by the Bureau; or
f. the Bureau identifies or is notified of an over-payment within one year of
the date the notification, ARC request or written opinion request was received
by the Bureau. In these cases, the refund will only apply to the over-payment.
6. — Withdrawing and re-submitting a notification (“pull and refile”)

If, during the initial waiting period under subsection 114(1) of the Act, a notifica-
tion is withdrawn more than two business days after it was initially received and
the parties subsequently resubmit a notification in respect of the same proposed
583
transaction (“Subsequent Notification”), no fee will be required for the Subsequent

Notification if the following conditions are met:
a. the Subsequent Notification, specifically as it relates to the prescribed infor-
lations, is current as of the date it is received by the Bureau;
b. the Subsequent Notification is certified pursuant to section 118 of the Act;
c. the Subsequent Notification is received by the Bureau within five business
d. there has been no material change in respect of the proposed transaction;
and
e. it is the first Subsequent Notification.
If these conditions are not met, the Subsequent Notification will be considered a
fresh notification that is subject to the applicable fee and service standards. Where
the above conditions are met, the service standard will, regardless of whether an
ARC request has also been received in respect of the same transaction, recom-
mence when the Subsequent Notification is received, assuming it meets the criteria
set out above, to best align the service standard period with the statutory waiting
period.
7. — Review mechanisms
Parties submitting a notification, ARC request, or written opinion request are in-
vited to provide feedback to the Bureau by completing the brief evaluation leaflet
enclosed with each response to a request for service. Completed leaflets should be
mailed to the Bureau’s Compliance and Operations Branch, which prepares reports
for the Mergers Branch to ensure the anonymity of the respondents’ feedback to the
Bureau.
Complaints regarding services and regulatory processes for which fees and service
standards apply can be directed to the Deputy Commissioner of Competition, Com-
pliance and Operations Branch. The Deputy Commissioner will examine the matter
and will provide feedback to the complainant.
Contact information for the Deputy Commissioner of Competition, Compliance
and Operations Branch, is:
Deputy Commissioner of Competition, Compliance and Operations
Branch
Competition Bureau
50 Victoria Street
Telephone: 819-953-7942
Facsimile: 819-953-3464
On application, any resolution deemed by the complainant to be unsatisfactory will
be further investigated by the Commissioner. Complainants will receive feedback
584
as well as information regarding any subsequent resolutions or decisions relating to

the original complaint.
Contact information for the Commissioner is:
Competition Bureau
50 Victoria Street
Telephone: 819-997-5300
Facsimile: 819-953-5013
All complaints will be handled in the strictest confidence.
Date modified:
2020-04-01
Guidelines
585
MERGER ENFORCEMENT GUIDELINES
OCTOBER 2011*
TABLE OF CONTENTS
FOREWORD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 589
PART 1: DEFINITION OF MERGER . . . . . . . . . . . . . . . . . . . . . . . . . . 590

Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 590
Significant Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 591
Notifiable Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 592
Share Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 592
Asset Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 594
Increasing an Existing Interest in a Business . . . . . . . . . . . . . . . . . . . . . 594
Guidelines
Interlocking Directorates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 594
Other Considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 595
PART 2: THE ANTI-COMPETITIVE THRESHOLD . . . . . . . . . . . . . . . 595

Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 595
Lessening of Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 596
Prevention of Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 596
Substantiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 598
PART 3: ANALYTICAL FRAMEWORK . . . . . . . . . . . . . . . . . . . . . . . . 598
PART 4: MARKET DEFINITION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 600

Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 600
Product Market Definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 602
* Merger Enforcement Guidelines, Innovation, Science and Economic Development Canada,

https://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03420.html. Reproduced with
the permission of the Minister of Innovation, Science and Economic Development, 2020.
The content of this publication may be subject to change or may be removed from the
Government website without notice.
587
Merger Enforcement Guidelines
Geographic Market Definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 603

Foreign Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 605
Delineating Geographic Boundaries . . . . . . . . . . . . . . . . . . . . . . . . . . . 605
PART 5: MARKET SHARES AND CONCENTRATION . . . . . . . . . . . . 606

Calculating Market Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 606
Market Share and Concentration Thresholds . . . . . . . . . . . . . . . . . . . . . . . . . 608
PART 6: ANTI-COMPETITIVE EFFECTS . . . . . . . . . . . . . . . . . . . . . . 609

Unilateral Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 611
Firms in Differentiated Product Industries . . . . . . . . . . . . . . . . . . . . . . . 611
Firms in Homogeneous Product Industries . . . . . . . . . . . . . . . . . . . . . . 613
Bidding and Bargaining Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 613
Coordinated Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 613
Market Concentration and Entry Barriers . . . . . . . . . . . . . . . . . . . . . . . 615
Indicia Suggesting That Market Conditions are Conducive to Coordination
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 615
Impact of the Merger on Coordinated Behaviour . . . . . . . . . . . . . . . . . . 617
PART 7: ENTRY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 617

Conditions of Entry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 618
Timeliness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 618
Likelihood . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 618
Sufficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 619
Types of Barriers to Entry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 619
Regulatory Barriers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 620
Sunk Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 620
Other Factors That Deter Entry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 621
PART 8: COUNTERVAILING POWER . . . . . . . . . . . . . . . . . . . . . . . . 621
PART 9: MONOPSONY POWER . . . . . . . . . . . . . . . . . . . . . . . . . . . . 622
PART 10: MINORITY INTEREST TRANSACTIONS AND INTERLOCKING

DIRECTORATES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 624
PART 11: NON-HORIZONTAL MERGERS . . . . . . . . . . . . . . . . . . . . . 625

Unilateral Effects of Non-Horizontal Mergers . . . . . . . . . . . . . . . . . . . . . . . 626
Coordinated Effects of Non-Horizontal Mergers . . . . . . . . . . . . . . . . . . . . . . 627
588
PART 12: THE EFFICIENCY EXCEPTION . . . . . . . . . . . . . . . . . . . . . 628

Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 628
Gains in Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 629
Burden on the Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 630
Types of Efficiencies Generally Included in the Trade-off: Gains in Productive
Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 631
Types of Efficiencies Generally Included in the Trade-off: Gains in Dynamic
Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 632
Types of Efficiencies Generally Included in the Trade-off: Deductions to
Gains . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 633
Types of Efficiencies Generally Excluded from the Trade-Off . . . . . . . . 633
Anti-Competitive Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 634

Price Effects: Loss of Allocative Efficiency (Deadweight Loss) . . . . . . 635
Price Effects: Redistributive Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . 636
Non-Price Effects: Reduction in Service, Quality, Choice . . . . . . . . . . . 636
Non-Price Effects: Loss of Productive Efficiency . . . . . . . . . . . . . . . . . 636
Non-Price Effects: Loss of Dynamic Efficiency . . . . . . . . . . . . . . . . . . 636
Guidelines
The Trade-Off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 636
PART 13: FAILING FIRMS AND EXITING ASSETS . . . . . . . . . . . . . . 637

Business Failure and Exiting Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 637
Alternatives to the Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 639
Acquisition by a Competitively Preferable Purchaser . . . . . . . . . . . . . . . 639
Retrenchment/Restructuring . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 639
Liquidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 640
HOW TO CONTACT THE COMPETITION BUREAU . . . . . . . . . . . . . . 640
FOREWORD
The Competition Bureau (“the Bureau”) has issued these guidelines to provide gen-
eral direction on its analytical approach to merger review. The guidelines describe,
to the extent possible, how the Bureau analyzes merger transactions. Given that
merger law applies to a wide variety of factual circumstances, these guidelines are
not applied rigidly. As such, this document sets out the Bureau’s general approach
to merger review and is not a binding statement of how the analysis is carried out in
any particular case. The specific facts of a case, as well as the nature of the infor-
mation and data available, determine how the Bureau assesses a proposed transac-
tion and may sometimes require methodologies other than those noted here.
589
Merging parties are encouraged to contact the Bureau at an early stage to discuss
proposed transactions, and should obtain appropriate legal advice when contem-
plating a merger.1 The final interpretation of the Competition Act (the “Act”) rests
with the Competition Tribunal (“the Tribunal”) and the courts.2
These guidelines supersede previous merger enforcement guidelines and statements
made by the Commissioner of Competition (“the Commissioner”) or other Bureau
officials. These guidelines also supersede the Bureau’s Bulletin on Efficiencies in
Merger Review. The Bureau may revisit certain aspects of these guidelines in the
future based on amendments to the Act, decisions of the Tribunal and the courts,
developments in the economic literature and the Bureau’s case experience.
PART 1: DEFINITION OF MERGER

1.1 Section 91 of the Act defines a “merger” as “. . . the acquisition or establish-
ment, direct or indirect, by one or more persons, whether by purchase or lease
of shares or assets, by amalgamation or by combination or otherwise, of con-
trol over or significant interest in the whole or a part of a business of a com-
petitor, supplier, buyer or other person.”
1.21 This definition covers any manner in which control over, or a significant inter-
est in, the whole or a part of a business of another person is acquired or estab-
lished.3 While these guidelines focus primarily on mergers of firms that sup-
ply competing products (horizontal mergers), section 91 also captures mergers
of firms that do not compete (non-horizontal mergers, addressed in Part 11,
below).
Control
1.3 Acquisition of control constitutes a merger under section 91. With respect to
corporations, section 2(4) of the Act defines “control” to mean de jure (legal)
control — that is, a direct or indirect holding of more than 50 percent of the
votes that may be cast to elect directors of the corporation, and which are
sufficient to elect a majority of such directors. With respect to partnerships,
1 See also the Bureau’s Merger Review Process Guidelines, Procedures Guide for Notifiable
Transactions and Advance Ruling Certificates under the Competition Act and Fee and Ser-
vice Standards Handbook for Mergers and Merger-Related Matters.
2 Competition Act, R.S.C. 1985, c. C-34.
3 As outlined in the Bureau’s Competitor Collaboration Guidelines, paragraph 1.2(a), a
transaction that does not fall within the definition of “merger” may in some instances be
subject to review under the civil provision in section 90.1 of the Act. Parties who are uncer-
tain as to whether an agreement will be assessed as a merger or a competitor collaboration
are encouraged to consult the Competitor Collaboration Guidelines and to contact the Bu-
reau at the earliest opportunity to discuss how the Bureau is likely to assess such an agree-
ment if pursued.
590
section 2(4) provides that a partnership is controlled by a person when the

person holds an interest in the partnership that entitles the person to receive
more than 50 percent of the profits of the partnership or more than 50 percent
of its assets on dissolution.
Significant Interest
1.4 The Act does not define what constitutes a “significant interest,” as referenced
in section 91, leaving this concept to be construed within the broader context
of the Act as a whole.
1.5 When determining whether an interest is significant, the Bureau considers
both the quantitative nature and qualitative impact of the acquisition or estab-
lishment of the interest. Given that the Act is concerned with firms’ competi-
tive market behaviour, a “significant interest” in the whole or a part of a busi-
ness is held qualitatively when the person acquiring or establishing the interest
(the “acquirer”) obtains the ability to materially influence the economic beha-
viour of the target business, including but not limited to decisions relating to
pricing, purchasing, distribution, marketing, investment, financing and the li-
censing of intellectual property rights.
1.6 The factors that may be relevant to the Bureau’s analysis of whether a particu-
lar minority shareholding, an interest in a combination, agreement or other
Guidelines
relationship or interest confers material influence (as per paragraph 1.5) in-
clude the following:
• voting rights attached to the acquirer’s shareholdings or interest in a
combination;
• the status of the acquirer of partnership interests (e.g., general or limited
partner) and the nature of the rights and powers attached to the partner-
ship interest;
• the holders and distribution of the remaining shares or interests (whether
the target business is widely or closely held, and whether the acquirer
will be the largest shareholder);
• board composition4 and board meeting quorum, attendance and historical
voting patterns (whether the acquirer will be able to carry or block votes
in a typical meeting);
• the existence of any special voting or veto rights attached to the ac-
quirer’s shares or interests (e.g., the extent of shareholder approval rights
for non-ordinary-course transactions);
• the terms of any shareholder or voting agreements;
• the dividend or profit share of the minority interest as compared to the
acquirer’s equity ownership share;
4 This includes both the total number of directors and the number of directors who are the
acquirer’s nominees.
591
• the extent, if any, of the acquirer’s influence over the selection of man-
agement or of members of key board committees;
• the status and expertise of the acquirer relative to that of other
shareholders;
• the services (management, advisory or other) the acquirer is providing to
the business, if any;
• the put, call or other liquidity rights, if any, that the acquirer has and may
use to influence other shareholders or management;
• the access the acquirer has, if any, to confidential information about the
business; and
• the practical extent to which the acquirer can otherwise impose pressure
on the business’s decision-making processes.
It is generally the combination of factors — not the presence or absence of a
single factor — that is determinative in the Bureau’s assessment of material
influence.
Notifiable Transactions
1.7 In the absence of any evidence to the contrary, the Bureau presumes that no-
tifiable transactions described in Part IX of the Act constitute the acquisition
or establishment of a significant interest in the whole or a part of a business. A
transaction is notifiable where the relevant transaction-size and party-size
thresholds are exceeded and, in the case of a share acquisition5, where the
shareholding threshold (voting interest of more than 35% for a private corpo-
ration or more than 20% for a public corporation) is also exceeded.
Share Acquisitions
1.8 Share acquisitions (whether or not they are notifiable) fall within the scope of
section 91 when the acquirer obtains the ability to materially influence the
economic behaviour of a business by purchasing shares or other securities.
When assessing whether a particular minority shareholding confers material
influence, the Bureau conducts a case-by-case analysis of the relationship be-
tween the acquirer and the target business, and of the various mechanisms
through which the acquirer might exercise influence.
5 Where the transaction involves the acquisition of an interest in a combination, a further

threshold also applies. Such a transaction will be notifiable only if the person or persons
acquiring the interest, together with their affiliates, would be entitled to receive more than
35% of the profits of the combination (more than 50% if they are already entitled to more
than 35%), or 35% of its assets on dissolution (more than 50% if they are already entitled to
more than 35%).
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1.9 In the case of voting shares, the Bureau considers that a significant interest in
a corporation exists when one or more persons directly or indirectly hold
enough voting shares
• to obtain a sufficient level of representation on the board of directors to
materially influence that board, with reference to the factors outlined in
paragraph 1.6 and any other relevant factors; or
• to block special or ordinary resolutions of the corporation.
1.10 The Bureau will also consider whether voting shares give the person or per-
sons who hold them the ability to exercise material influence through other
mechanisms, with reference to the factors outlined in paragraph 1.6 and any
other relevant factors. In the absence of other relationships, direct or indirect
ownership of less than 10 percent of the voting interests in a business does not
generally constitute ownership of a significant interest.6 While inferences
about situations that result in a direct or indirect holding of between 10 percent
and 50 percent of voting interests are more difficult to draw, a larger voting
interest is ordinarily required to materially influence a private company than a
widely held public company. The merger notification requirements in Part IX
of the Act, referred to in paragraph 1.7 above, are triggered at a voting inter-
est of more than 35 percent for private corporations and of more than 20 per-
cent for public corporations.7
Guidelines
1.11 When a transaction involves the purchase of non-voting shares,8 the Bureau
examines whether the holder of the minority interest can materially influence
the economic behaviour of the business despite its inability to vote its shares,
with reference to the factors outlined in paragraph 1.6 and any other relevant
factors.
1.12 In the case of convertible securities or options, a significant interest may be
acquired or established when these securities are first purchased or created, or
at the time they are converted or exercised.9 To determine whether a purchase
6 This position is consistent with other Canadian statutes. See, for example, Bank Act, S.C.
1991, c. 46, s. 8. (See also Cooperative Credit Associations Act, S.C. 1991, c. 48, s. 9; Insur-
ance Companies Act, S.C. 1991, c. 47, s. 8; and Trust and Loan Companies Act, S.C. 1991,
c. 45, s. 8.) The Bureau typically requires disclosure of all holdings that account for 10
percent or more of the voting interests in a business, and may seek information respecting
other minority holdings in the course of a merger review.
7 The pre-merger notification provisions are discussed in the Bureau’s Procedures Guide for
Notifiable Transactions and Advance Ruling Certificates under the Competition Act and the
Interpretation Guidelines for Notifiable Transactions under Part IX of the Competition Act.
8 When non-voting shares are convertible (for example, into voting shares), they will also be
assessed under paragraph 1.12.
9 A convertible security is a bond, debenture, preferred share or other security that may be
exchanged by the owner, usually for common shares of the same company, in accordance
with specified conversion terms. An option is a right to buy or sell specific securities or
properties at a specified price within a specified time.
593
constitutes a significant interest, the Bureau examines the nature of and cir-
cumstances in which the rights (or potential rights) attached to these securities
may be exercised, and the influence that the acquirer may possess through
their exercise, or threat of exercise, with reference to the factors outlined in
paragraph 1.6 and any other relevant factors.
Asset Acquisitions
1.13 Asset transactions (whether or not they are notifiable) that generally fall
within the scope of section 91 include the purchase or lease of an unincorpo-
rated division, plant, distribution facilities, retail outlet, brand name or intel-
lectual property rights from the target company. The Bureau treats the acquisi-
tion of any of these essential assets, in whole or in part, as the acquisition or
establishment of a significant interest in that business. Further, acquiring a
subset of the assets of a business that is capable of being used to carry on a
separate business is also considered to be the acquisition or establishment of a
significant interest in the business.
Increasing an Existing Interest in a Business

1.14 Persons already holding a significant interest in the whole or a part of a busi-
ness may trigger the merger provisions of the Act by acquiring or establishing
a materially greater ability to influence the economic behaviour of the
business.
Interlocking Directorates
1.15 An interlocking directorate may arise where a director of one firm is an em-
ployee, executive, partner, owner or member of the board of directors of a
second firm, or has another interest in the business of the second firm. An
interlocking directorate is generally of interest under section 92 of the Act
only when the interlocked firms are competitors, are vertically related, or pro-
duce complementary or related products.
1.16 Interlocking directorates may be features of transactions that otherwise qualify
as mergers. For example, an interlock results from the merger of firms A and
B when an executive of A sits on the board of firm C, and C competes with B.
Interlocking directorates may be features of minority interest transactions; for
example, a firm that acquires a minority interest in its competitor may also
obtain rights to nominate one or more directors to its competitor’s board. An
interlocking directorate would rarely qualify, in and of itself, as the establish-
ment of a significant interest.
1.17 When assessing whether an interlocked director has the ability to materially
influence the economic behaviour of the interlocked firm(s), the Bureau’s fo-
cus is typically on the access that an interlocked director has to confidential
information, and on the director’s voting and veto rights in the context of the
board composition, quorum and voting rules, including attendance and histori-
cal voting patterns.
594
Other Considerations
1.18 A significant interest can be acquired or established under shareholder agree-
ments, management contracts, franchise agreements and other contractual ar-
rangements involving corporations, partnerships, joint ventures, combinations
and other entities, depending on the terms of the arrangements. In addition,
loan, supply and distribution arrangements that are not ordinary-course trans-
actions and that confer the ability to materially influence the economic beha-
viour of the target business (for example, financing arrangements and terms of
default relating to such arrangements; long-term contractual arrangements or
pre-existing long-term business relationships) may constitute a merger within
the meaning of section 91.
1.19 When determining whether an acquisition or establishment of a significant in-
terest constitutes a merger, the Bureau examines the relationship between the
parties prior to the transaction or event establishing the interest, the likely sub-
sequent relationship between the parties, the access that an acquirer has and
obtains to confidential business information of the target business, and evi-
dence of the acquirer’s intentions to affect the behaviour of that business.
PART 2: THE ANTI-COMPETITIVE THRESHOLD
Guidelines
Overview
2.1 As set out in section 92(1) of the Act, the Tribunal may make an order when it
finds that a merger “prevents or lessens, or is likely to prevent or lessen, com-
petition substantially.” A substantial prevention or lessening of competition
results only from mergers that are likely to create, maintain or enhance the
ability of the merged entity, unilaterally or in coordination with other firms, to
exercise market power.
2.2 In general, when evaluating the competitive effects of a merger, the Bureau’s
primary concerns are price and output. The Bureau also assesses the effects of
the merger on other dimensions of competition, such as quality, product
choice, service, innovation and advertising — especially in markets in which
there is significant non-price competition. To simplify the discussion, unless
otherwise indicated, the term “price” in these guidelines refers to all aspects of
firms’ actions that affect the interests of buyers. References to an increase in
price encompass an increase in the nominal price, but may also refer to a re-
duction in quality, product choice, service, innovation or other dimensions of
competition that buyers value.
2.3 These guidelines describe the analytical framework for assessing market
power from the perspective of a seller of a product or service (“product,” as
defined in section 2(1) of the Act). Market power of sellers is the ability of a
firm or group of firms to profitably maintain prices above the competitive
level for a significant period of time. The jurisprudence establishes that it is
the ability to raise prices, not whether a price increase is likely, that is
determinative.
595
2.4 The Bureau also applies this analytical framework to its assessment of the
market power of the buyers of a product. Market power of buyers is the ability
of a single firm (monopsony power) or a group of firms (oligopsony power)10
to profitably depress prices paid to sellers (by reducing the purchase of inputs,
for example) to a level that is below the competitive price for a significant
period of time. Part 9, below, sets out the Bureau’s approach to situations of
monopsony power.
2.5 The Bureau analyzes competitive effects under two broad headings: unilateral
exercise of market power and coordinated exercise of market power. The same
merger may involve both a unilateral and a coordinated exercise of market
power.
2.6 A unilateral exercise of market power can occur when a merger enables the
merged firm to profitably sustain higher prices than those that would exist in
the absence of the merger, without relying on competitors’ accommodating
responses.
2.7 A coordinated exercise of market power can occur when a merger reduces the
competitive vigour in a market by, for example, removing a particularly ag-
gressive competitor or otherwise enabling or enhancing the ability of the
merged firm to coordinate its behaviour with that of its competitors. In these
situations, higher post-merger prices are profitable and sustainable because
other competitors in the market have accommodating responses.
2.8 When a merger is not likely to have market power effects, it is generally not
possible to demonstrate that the transaction will likely prevent or lessen com-
petition substantially, even though the merger might have implications for
other industrial policy objectives that are beyond the scope of the Act.
Lessening of Competition
2.9 A merger may substantially lessen competition when it enables the merged
firm, unilaterally or in coordination with other firms, to sustain materially
higher prices than would exist in the absence of the merger by diminishing
existing competition. This typically occurs with horizontal mergers when there
is direct or existing overlap between the operations of the merging firms. This
can also occur with non-horizontal mergers, such as those that foreclose rivals
from accessing inputs to production.
Prevention of Competition
2.10 Competition may be substantially prevented when a merger enables the
merged firm, unilaterally or in coordination with other firms, to sustain materi-
ally higher prices than would exist in the absence of the merger by hindering
10 Oligopsony power occurs where market power in the relevant purchasing market is exer-
cised by a coordinated group of buyers. Except where otherwise indicated in these guide-
lines, the term “monopsony” includes situations of oligopsony.
596
the development of anticipated future competition. This typically occurs when

there is no or limited direct overlap between the merging firms’ existing busi-
nesses, but direct competition between those businesses was expected to de-
velop or increase in the absence of the merger. It may also occur when there is
direct overlap between the merging parties’ existing business(es) and the com-
petitive effectiveness of one of the merging firms was expected to increase
absent the merger, for example, because of the introduction of an improved
product.
2.11 In these circumstances, the Bureau examines whether, absent the merger,
timely entry or expansion11 by either of the merging firms would likely occur
on a sufficient scale and with sufficient scope to prevent incumbents from ex-
ercising market power.12 “Timely” means that such entry would have occurred
within a reasonable period of time, given the characteristics and dynamics of
the market in question.13 “Likely” refers to the expectation that entry by one
of the merging firms would occur. The Bureau also considers whether effec-
tive entry by rival firms is likely, and the impact of such rival entry or expan-
sion on prices. “Sufficient” means that, in the absence of the merger, entry by
one of the merging firms would have caused prices to materially decrease. It
also encompasses a scenario in which the threat of such entry has prevented a
material price increase from occurring. The Bureau may examine a merger in
terms of prevention of competition when the merger forestalls the entry plans
Guidelines
of the acquirer, the target or a potential competitor, or when the merger
removes independent control of capacity or an asset that provides or was
likely to provide an important source of competitive discipline.
2.12 The following are examples of mergers that may result in a substantial preven-
tion of competition:
• the acquisition of a potential entrant or of a recent entrant that was likely
to expand or become a more vigorous competitor;
• an acquisition by the market leader that pre-empts a likely acquisition of
the same target by a competitor;
• the acquisition of an existing business that would likely have entered the
market in the absence of the merger;
• an acquisition that prevents expansion into new geographic markets;
• an acquisition that prevents the pro-competitive effects associated with
new capacity; and
11 Throughout these guidelines, the term “entry” also refers to expansion by existing firms.
12 The terms “timely,” “likely” and “sufficient” are discussed in further detail in Part 7,
below.
13 Since the harm occasioned by a merger that substantially prevents competition may be
sustained over the long term, the Bureau may consider longer time frames when assessing
the effects of a prevention of competition than it does when assessing post-merger entry (see
Part 7, below).
597
• an acquisition that prevents or limits the introduction of new products.
Substantiality
2.13 When the Bureau assesses whether a merger is likely to prevent or lessen com-
petition substantially, it evaluates whether the merger is likely to provide the
merged firm, unilaterally or in coordination with other firms, with the ability
to materially influence price. The Bureau considers the likely magnitude and
duration of any price increase that is anticipated to follow from the merger.
Generally speaking, the prevention or lessening of competition is considered
to be “substantial” in two circumstances:
• the price of the relevant product(s) would likely be materially higher in
the relevant market than it would be in the absence of the merger (“mate-
rial price increase”); and
• sufficient new entry would not occur rapidly enough to prevent the mate-
rial price increase, or to counteract the effects of any such price increase.
2.14 The Bureau does not consider a numerical threshold for the material price in-
crease.14 Instead, it bases its conclusions about whether the prevention or les-
sening of competition is substantial on an assessment of market-specific fac-
tors that could have a constraining influence on price following the merger.
Additionally, where the merging firms, individually or collectively, have pre-
existing market power, smaller impacts on competition resulting from the
merger will meet the test of being substantial.
PART 3: ANALYTICAL FRAMEWORK

3.1 In determining whether a merger is likely to create, maintain or enhance mar-
ket power, the Bureau must examine the competitive effects of the merger.
This exercise generally involves defining the relevant markets and assessing
the competitive effects of the merger in those markets. Market definition is not
necessarily the initial step, or a required step, but generally is undertaken. The
same evidence may be relevant and contribute to both the definition of rele-
vant markets and the assessment of competitive effects. Merger review is
often an iterative process in which evidence respecting the relevant market and
market shares is considered alongside other evidence of competitive effects,
with the analysis of each informing and complementing the other.
14 A material price increase is distinct from (and will generally be less than) the “significant
and non-transitory price increase” that is used to define relevant markets, as described in
Part 4, below. What constitutes a “materially greater” price varies with the industry and the
context. For purposes of the statement above, materiality includes not only the magnitude
and scope but also the sustainability of the price increase.
598
3.2 The overall objective of market definition in merger analysis is to identify the
set of products that customers consider to be substitutes for those produced by
the merging firms and the set or sets of buyers that could potentially face in-
creased market power owing to the merger. Market definition, and the mea-
surement of market share and concentration in the relevant market, is not an
end in itself. Consistent with this, section 92(2) of the Act precludes the Tribu-
nal from concluding that a merger is likely to prevent or lessen competition
substantially solely on the basis of evidence of concentration or market share.
The ultimate inquiry is not about market definition, which is merely an analyt-
ical tool — one that defies precision and can thus vary in its usefulness — to
assist in evaluating effects. Rather, the ultimate inquiry is about whether a
merger prevents or lessens competition substantially. That said, when review-
ing a merger, market definition generally sets the context for the Bureau’s as-
sessment of the likely competitive effects of a merger.
3.3 In some cases, it may be clear that a merger will not create, preserve or en-
hance market power under any plausible market definition. Alternatively, it
may be clear that anti-competitive effects would result under all plausible mar-
ket definitions. In both such circumstances, the Bureau need not reach a firm
conclusion on the precise metes and bounds of the relevant market(s). Addi-
tionally, when a completed merger has resulted in a material price increase,
the Bureau may rely on evidence of that increase, taking into account other
Guidelines
relevant factors. Cases may also arise in which the choice among several plau-
sible market definitions may have a significant impact on market share. In
such cases, there may be a greater need for evidence regarding likely competi-
tive effects that is not based on market share and concentration. While the
Bureau may elect not to define markets in cases in which other reliable evi-
dence of competitive effects is available, the Bureau will normally identify
one or more relevant markets in which competition is prevented or lessened, in
any merger enforcement action.
3.4 Section 93 of the Act sets out a non-exhaustive list of discretionary factors that
the Tribunal may consider when determining whether a merger prevents or
lessens competition substantially, or is likely to do so.15 These factors, which
are largely qualitative, may be relevant to the Bureau’s assessment of market
definition or of the competitive effects of a merger, or both. These factors are
discussed in detail in Parts 4 and 6, below.16
15 Section 93 provides that the Tribunal “may” have regard to the listed factors, while sec-
tion 93(h) permits the Tribunal to consider any other relevant factor. The Bureau does not
consider the section 93 factors in a linear fashion. Rather, these factors form part of the
analysis of competitive effects, to the extent they are relevant in a particular case. The Bu-
reau encourages parties in their submissions to focus only on the factors and evidence that
are relevant to the assessment of the impact of their merger on competition, rather than to
treat the section 93 factors as a “checklist” to address in every case.
16 See also Part 7 on barriers to entry (section 93(d)) and Part 13 on “failing firm” (section
93(b)).
599
3.5 The Bureau may also assess competitive effects from a quantitative perspec-
tive using various economic tools. The Bureau has discretion in determining
which economic and other analytical tools it uses in particular cases. As the
economic tools evolve, so will the Bureau’s analytical approach.
3.6 The tools the Bureau uses to assess competitive effects also depend heavily on
the facts of each case as well as on the availability of qualitative and quantita-
tive evidence. Qualitative evidence may come from documents created by the
merging parties in the ordinary course of business or from first-hand observa-
tions of the industry by customers or other market participants. Quantitative
evidence may be derived from statistical analyses of price, quantity, costs or
other data maintained by the merging parties and/or third parties. In all cases,
the Bureau assesses the reliability, robustness and probative value of the evi-
dence gathered.
PART 4: MARKET DEFINITION

Overview
4.1 When the Bureau assesses relevant markets, it does so from two perspectives:
the product dimension and the geographic dimension. As a general principle,
the Bureau does not assume that the merging parties operate in the same rele-
vant market(s), even when there appears to be some overlap between their
products and the geographic areas in which they conduct business. In addition,
the relevant market(s) being analyzed for competitive effects may not necessa-
rily correspond to the product categories or service areas established by the
merging firms or their rivals for operational purposes.
4.2 Market definition is based on substitutability, and focuses on demand re-
sponses to changes in relative prices after the merger. The ability of a firm or
group of firms to raise prices without losing sufficient sales to make the price
increase unprofitable ultimately depends on buyers’ willingness to pay the
higher price.17 The ability of competitive suppliers to respond to a price in-
crease is also important when assessing the potential for the exercise of market
power, but the Bureau examines such responses later in the analysis — either
when identifying the participants in the relevant market or when examining
entry into the relevant market.
4.3 Conceptually, a relevant market is defined as the smallest group of products,
including at least one product of the merging parties, and the smallest geo-
graphic area, in which a sole profit-maximizing seller (a “hypothetical monop-
olist”) would impose and sustain a small but significant and non-transitory
17 The Bureau typically considers product and geographic substitutes that are included in a
single relevant market to be “acceptable” within the meaning of section 93(c) of the Act.
When products within a relevant market are differentiated, some may be closer substitutes
than others.
600
increase in price (“SSNIP”) above levels that would likely exist in the absence
of the merger.18 In most cases, the Bureau considers a five percent price in-
crease to be significant and a one-year period to be non-transitory. Market
characteristics may support using a different price increase or time period.
4.4 The market definition analysis begins by postulating a candidate market for
each product of the merging parties. For each candidate market, the analysis
proceeds by determining whether a hypothetical monopolist controlling the
group of products in that candidate market would profitably impose a SSNIP,
assuming the terms of sale of all other products remained constant.19 If the
price increase would likely cause buyers to switch their purchases to other
products in sufficient quantity to render the price increase unprofitable, the
postulated candidate market is not the relevant market, and the next-best sub-
stitute is added to the candidate market.20 The analysis then repeats by deter-
mining whether a hypothetical monopolist controlling the set of products in
the expanded candidate market would profitably impose a SSNIP. This pro-
cess continues until the point at which the hypothetical monopolist would im-
pose and sustain the price increase for at least one product of the merging
parties in the candidate market. In general, the smallest set of products in
which the price increase can be sustained is defined as the relevant product
market.
4.5 The same general approach applies to assessing the geographic scope of the
Guidelines
market. In this case, an initial candidate market is proposed for each location
where a merging party produces or sells the relevant products. As above, if
buyers are likely to switch their purchases to sellers in more distant locations
in sufficient quantities to render a SSNIP by a hypothetical monopolist unprof-
itable, the location that is the next-best substitute is added to the candidate
market. This process continues until the smallest set of areas over which a
hypothetical monopolist would impose and sustain the price increase is
identified.
4.6 The base price used to postulate a price increase is typically the prevailing
price in the relevant market. The Bureau may elect not to use the prevailing
price when market conditions (absent the merger) would likely result in a
lower or higher price in the future.21
18 A market may consist of a single homogeneous product or a group of differentiated

products.
19 Changes in terms of sale of other products in response to the merger are accounted for in
the analysis of competitive effects and entry.
20 The next-best substitute is the product that would account for the greatest diversion in
demand by buyers in response to the postulated price increase, assuming that the product is
available in unlimited quantities at constant prices.
21 When the evidence suggests a change in the future price (absent the merger) can be pre-
dicted with confidence, the Bureau may delineate markets based on the likely future price,
even when that future price cannot be predicted precisely.
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4.7 In general, the base price used to postulate a price increase is whatever is ordi-
narily considered to be the price of the product in the sector of the industry
(e.g., manufacturing, wholesale, retail) being examined.
4.8 In some circumstances, sellers may identify and charge different prices to va-
rious targeted sets of buyers (“price discrimination”). Sellers are able to price
discriminate when targeted buyers cannot effectively switch to other products
or geographic locations, and cannot engage in arbitrage with other buyers by
taking advantage of price differences. When price discrimination is feasible, it
may be appropriate to define relevant markets with reference to the character-
istics of the buyers who purchase the product (assuming they can be deline-
ated) or to the particular locations of the targeted buyers.
4.9 The factors the Bureau considers when analyzing the product and geographic
dimensions of market definition are set out below.
Product Market Definition

4.10 For the purpose of product market definition, what matters is not the identity
of sellers, but the characteristics of the products and buyers’ ability or willing-
ness to switch from one product to another in response to changes in relative
prices.22 A relevant product market consists of a given product of the merging
parties and all substitutes required for a SSNIP to be profitable.
4.11 When detailed data on the prices and quantities of the relevant products and
their substitutes are available, statistical measures may be used to define rele-
vant product markets. Demand elasticities indicate how buyers change their
consumption of a product in response to changes in the product’s price (own-
price elasticity) or in response to changes in the price of another identified
product (cross-price elasticity). While cross-price elasticities do not in them-
selves directly measure the ability of a firm to profitably raise prices, they are
particularly useful when determining whether differentiated products are sub-
stitutes for one another and whether such products are part of the same rele-
vant market.
4.12 Whether or not reliable statistical evidence on demand elasticities is available,
the Bureau considers factors that provide evidence of substitutability, includ-
ing evidence from market participants and the functional indicators high-
lighted below.
4.13 The views, strategies and behaviour of buyers are often reliable indicators of
whether buyers would likely switch to other products in response to a SSNIP.
For example, the Bureau examines what buyers have done in the past and
what they are likely to do in the future as options become available, for in-
stance, through advances in technology. Information from industry surveys
and industry participants, such as competitors and manufacturers of the rele-
22 In this context, switching refers to “economic substitutability,” defined as a change in

consumption patterns in response to a price change, holding all other factors constant.
602
vant product, is also taken into account. This information advances the analy-
sis by providing details on historical developments (including the past beha-
viour of the merging parties and their rivals) and likely future developments in
the industry. Pre-existing documents prepared by the merging parties in the
ordinary course of business can also be very useful in this regard.
4.14 Various functional indicators help to determine what products are considered
substitutes, including end use, physical and technical characteristics, price re-
lationships and relative price levels, as well as buyer switching costs, as dis-
cussed below. Buyers may not view products purchased for similar end uses as
substitutes. Therefore, functional interchangeability is not sufficient to warrant
inclusion of two products in the same relevant market. In general, when buy-
ers place a high value on the actual or perceived unique physical or technical
characteristics of a product (including warranties, post-sales service and order
turnaround time), it may be necessary to define distinct relevant markets based
on these characteristics.
4.15 Switching costs may discourage a sufficient number of buyers from purchas-
ing products that are functionally interchangeable, thereby allowing a hypo-
thetical monopolist to impose a SSNIP. Products are not included in the same
relevant market when costs that must be incurred by buyers are sufficient to
render switching unlikely in response to a SSNIP. Examples include costs for
buyers to retool, re-package, undertake product testing, adapt marketing
Guidelines
materials and strategies, terminate a supply contract, learn new procedures or
convert essential equipment. Other costs include the expense (and risk) buyers
must incur when a product fails to satisfy expectations, which may damage a
buyer’s reputation as a reseller, or require the shutdown of a production line.
4.16 A relevant market may consist of a group of diverse products that are not
themselves substitutes for each other. This occurs when a sole profit-maximiz-
ing seller would increase the price of the group of products because a suffi-
cient number of buyers would not respond to the price increase by purchasing
the various components separately from different sellers. This reaction may
occur when there are significant transaction costs associated with using a num-
ber of sellers, including transportation costs and the time required to negotiate
with multiple sellers. In these circumstances, the Bureau’s examination in-
cludes an assessment of these transaction costs, as well as buyers’ propensity
to purchase a number of products from a single seller and the extent to which
they have in the past broken up their purchases of a group of products in re-
sponse to relative price changes.
Geographic Market Definition

4.17 For the purpose of geographic market definition, what matters is not the iden-
tity of the sellers, but buyers’ ability or willingness to switch their purchases
in sufficient quantity from suppliers in one location to suppliers in another, in
response to changes in relative prices. A relevant geographic market consists
of all supply points that would have to be included for a SSNIP to be profita-
ble, assuming that there is no price discrimination (as described in paragraph
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4.8 above). When price discrimination is present (and buyers and third parties
are unable to arbitrage between low and high price areas), geographic markets
are defined according to the location of each targeted group of buyers.
4.18 When defining the boundaries of geographic markets, the Bureau generally
relies on evidence of substitutability, including evidence from market partici-
pants and the functional indicators described below and, when available, em-
pirical analysis.
4.19 The views, strategies and behaviour of buyers in a given geographic area are
often reliable indicators of whether buyers would likely switch their purchases
to sellers located in other geographic areas in the event of a SSNIP. For exam-
ple, the Bureau examines what buyers have done in the past and what they are
likely to do in the future as options become available through, for instance,
advances in technology. Industry surveys and the views, strategies and beha-
viour of industry participants also inform the analysis by providing informa-
tion on how buyers of a relevant product in one geographic area respond or
have responded to changes in the price, packaging or servicing of the relevant
product in another geographic area. The extent to which merging parties and
other sellers take distant sellers into account in their business plans, marketing
strategies and other documentation can also be a useful indicator for geo-
graphic market definition.
4.20 Various functional indicators can assist in determining whether geographic ar-
eas are considered to be substitutes, including particular characteristics of the
product, switching costs, transportation costs, price relationships and relative
price levels, shipment patterns and foreign competition.
4.21 Several price and non-price factors could affect buyers’ ability or willingness
to consider distant options. Non-price factors include the fragility or perish-
ability of the relevant product, convenience, frequency of delivery, and the
reliability of service or delivery.
4.22 As with product market definition, high switching costs may discourage buy-
ers from substituting between geographic areas. In addition, transportation
costs play a central role in defining the geographic scope of relevant markets
because they directly affect price. For example, when the price of the relevant
product in a distant area plus the cost of transporting it to a candidate geo-
graphic market exceeds the price in the candidate market including a SSNIP,
the relevant market does not generally include the products of sellers located
in the distant area.23
4.23 Evidence that prices in a distant area have historically either exceeded or been
lower than prices in the candidate geographic market by more than the trans-
portation costs may indicate that the two areas are in separate relevant mar-
23 However, distant firms that have excess capacity may in certain circumstances be willing
to ship to another market, even when the net price received is less than the price in their own
market.
604
kets, for reasons that go beyond transportation costs.24 However, before reach-
ing this conclusion, the Bureau determines whether a SSNIP in the candidate
geographic market may change the pricing differential to the point that distant
sellers may be able to constrain a SSNIP.
4.24 Significant shipments of the relevant product from a distant area into an area
in which a price increase is being postulated may suggest that the distant area
is in the relevant geographic market. However, pre-merger shipment patterns
do not, by themselves, establish the constraining effect of distant sellers and
may be insufficient to justify broadening the geographic market. The Bureau
undertakes further analysis to determine whether shipments from the distant
area would make the SSNIP unprofitable.
Foreign Competition
4.25 Buyers’ willingness or ability to turn to foreign sellers may be affected by
buyers’ tastes and preferences, and by border-related considerations. Buyers
may be less willing or able to switch to foreign substitutes when faced with
factors such as exchange rate risk, local licensing and product approval regula-
tions, industry-imposed standards, or initiatives to “buy local” owing to diffi-
culties or uncertainties when crossing the border. Conversely, buyers may be
more willing to turn to foreign substitutes when they have ample information
about foreign products and how to source them, when foreign sellers or their
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products have already been placed on approved sourcing lists, or when tech-
nology licensing agreements, strategic alliances or other affiliations exist be-
tween domestic buyers and foreign firms.
4.26 When it is clear that the sales area of the merging parties and that of foreign
sellers both belong in the relevant market (because sufficient buyers would be
willing to respond to a SSNIP by turning to these sellers), the boundaries of
the market are expanded beyond Canada to include the locations of foreign
sellers.25
Delineating Geographic Boundaries

4.27 The geographic locations of buyers and sellers are relevant to delineating
boundaries, particularly when markets are local or regional in nature. The un-
derlying assumption is that profit-maximizing firms make decisions about
where to locate based on the density of their buyer base and try to avoid canni-
balizing their own sales when they have two or more locations in close prox-
imity. In this way, demand responses are still key determinants of market
boundaries. The Bureau may use spatial competition analysis to help delineate
24 For example, the existence of tariffs or other trade-related factors may create price
differentials.
25 See section 93(a) of the Act. In addition to its relevance to market definition, the extent to
which foreign products or foreign competitors provide or are likely to provide effective com-
petition is evaluated in the context of the analysis described in Parts 5, 6 and 7, below.
605
the boundaries of localized geographic markets.26 The methodology for apply-

ing spatial competition analysis depends on the characteristics of the industry
and the market under consideration.
4.28 It is important to emphasize that market boundaries in respect of either prod-
uct or geographic markets are not precise in many instances. In addition, con-
straints on a merged firm’s pricing behaviour can come from both inside and
outside the relevant market as defined. These issues are discussed further
below.
PART 5: MARKET SHARES AND CONCENTRATION

5.1 When engaged in a market definition exercise, the Bureau identifies partici-
pants in a relevant market to determine market shares and concentration
levels. Such participants include (1) current sellers of the relevant products in
the relevant geographic markets and (2) sellers that would begin selling the
relevant products in the relevant geographic markets if the price were to rise
by a SSNIP. In the latter case, the Bureau considers a firm to be a participant
in a relevant market when it does not require significant sunk investments to
enter or exit the market and would be able to rapidly and profitably divert
existing sales or capacity to begin supplying the market in response to a SS-
NIP (a “supply response”).27 The Bureau considers situations in which com-
petitive sellers would need to incur significant sunk investments, or would not
be able to respond rapidly, in the analysis of entry (see Part 7, below).
Calculating Market Shares

5.2 The Bureau calculates market shares for all sellers who have been identified as
participants in the relevant market.
5.3 Market shares can be measured in various ways, for example in terms of dollar
sales, unit sales, capacity or, in certain natural resource industries, reserves.28
When calculating market shares, the Bureau uses the best indicators of sellers’
future competitive significance. In cases in which products are undifferenti-
ated or homogeneous (i.e., have no unique physical characteristics or per-
ceived attributes), and firms are all operating at full capacity, market shares
26 When using spatial competition analysis, the Bureau identifies all locations (such as
stores, branches, hubs and outlets) of both the merging parties and their product market com-
petitors, to determine how firms’ physical locations are situated relative to one another.
27 When merging firms compete across several markets and face the same competitors in
each, the Bureau may use an aggregate description of these markets simply as a matter of
convenience.
28 Throughout these guidelines, the term “capacity” means the ability to produce or sell a
product. Capacity to sell refers to marketing and distribution capabilities, such as a sales
force, distribution networks and other related infrastructure.
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based on dollar sales, unit sales and capacity should yield similar results. In
such situations, the basis of measurement depends largely on the availability
of data.
5.4 When firms producing homogeneous products have excess capacity, market
shares based on capacity may best reflect a firm’s relative market position and
competitive influence in the market. Excess capacity may be less relevant to
calculating market shares when it is clear that some of a firm’s unused capac-
ity does not have a constraining influence in the relevant market (e.g., because
the capacity is high-cost capacity or the firm is not effective in marketing its
product). When a regulated or historical incumbent firm is facing deregulation
or enhanced competition, shares based on new customer acquisitions may be a
better indicator of competitive vigor than are shares based on existing
customers.
5.5 As the level of product differentiation in a relevant market increases, market
shares calculated on the basis of dollar sales, unit sales and capacity increas-
ingly differ. For example, if most of the excess capacity in the relevant market
were held by discount sellers in a highly differentiated market, the market
shares of these sellers calculated on the basis of total capacity would be
greater than if they were calculated on the basis of actual unit or dollar sales.
In this case, market shares based on total capacity would be a misleading indi-
cator of the relative market position of the discount sellers.29 In such circum-
Guidelines
stances, dollar sales may be the better indicator of the size of the total market
and of the relative positions of individual firms. Because unit sales may also
provide important information about relative market positions, the Bureau
often requests both dollar sales and unit sales data from the merging parties
and other sellers.30
5.6 The Bureau generally includes the total output or total capacity of current sell-
ers located within the relevant market in the calculation of the total size of the
market and the shares of individual competitors. However, when a significant
proportion of output or capacity is committed to business outside the relevant
market and is not likely to be available to the relevant market in response to a
SSNIP, the Bureau generally does not include this output or capacity in its
calculations.
5.7 For firms that participate in the market through a supply response, the Bureau
only includes in the market share calculations the output or capacity that
29 Similar results occur as the level of differentiation between sellers increases. For instance,
two firms may operate with the same capacity (e.g., number of trucks) but have significantly
different revenue streams (because one firm may have many buyers along a truck route, i.e.,
route density). In such cases, market shares based on capacity and revenues provide different
information about relative market positions.
30 While publicly available or readily observable information may be useful for estimating
market shares, when credible and possible, the Bureau relies on transaction-level data from
individual market participants as the most accurate measure of market shares.
607
would likely become available to the relevant market without incurring signif-
icant sunk investments.
Market Share and Concentration Thresholds

5.8 Consistent with section 92(2) of the Act, information that demonstrates that
market share or concentration is likely to be high is not, in and of itself, suffi-
cient to justify a conclusion that a merger is likely to prevent or lessen compe-
tition substantially. However, information about market share and concentra-
tion can inform the analysis of competitive effects when it reflects the market
position of the merged firm relative to that of its rivals. In the absence of high
post-merger market share and concentration, effective competition in the rele-
vant market is generally likely to constrain the creation, maintenance or en-
hancement of market power by reason of the merger.
5.9 The Bureau has established the following thresholds to identify and distin-
guish mergers that are unlikely to have anti-competitive consequences from
those that require a more detailed analysis:
• The Commissioner generally will not challenge a merger on the basis of a
concern related to the unilateral exercise of market power when the post-
merger market share of the merged firm would be less than 35 percent.
• The Commissioner generally will not challenge a merger on the basis of a
concern related to a coordinated exercise of market power when
• the post-merger market share accounted for by the four largest firms
in the market (known as the four-firm concentration ratio or CR4)
would be less than 65 percent; or
• the post-merger market share of the merged firm would be less than
10 percent.
5.10 Mergers that give rise to market shares or concentration that exceed these
thresholds are not necessarily anti-competitive. Under these circumstances, the
Bureau examines various factors to determine whether such mergers would
likely create, maintain or enhance market power, and thereby prevent or lessen
competition substantially.
5.11 When other information suggests that current market shares do not reflect the
competitive role of one of the merging parties relative to its rivals, the Bureau
considers this information when determining whether a merger is likely to pre-
vent or lessen competition substantially. In all cases, examining market shares
and concentration is only one part of the Bureau’s analysis of competitive
effects.
5.12 In addition to the level of market shares or concentration in the relevant mar-
ket, the Bureau examines the distribution of market shares across competitors
and the extent to which market shares have changed or remained the same
over a significant period of time.
5.13 All else being equal, the likelihood that a number of firms may be able to
bring about a price increase through coordinated behaviour increases as the
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level of concentration in a market rises and as the number of firms declines.31

In contrast, coordinated behaviour becomes increasingly difficult as the num-
ber or size of firms that have the ability to increase output increases.
5.14 When evaluating market share information, the Bureau considers the nature of
the market and the impact of forthcoming change and innovation on the stabil-
ity of existing market shares.32 While a small incremental increase in concen-
tration following a merger may suggest that the merger is not likely to have a
significant impact on the market, the Bureau assesses the growth expectations
for one or both of the merging parties to determine whether the merger may
eliminate an important competitive force.
PART 6: ANTI-COMPETITIVE EFFECTS

6.1 As noted in Part 3, above, the Bureau may consider market definition and
competitive effects concurrently in a dynamic and iterative analytical process.
When the market share and concentration thresholds listed in paragraph 5.9,
above, are exceeded or when other information suggests that a merger may
prevent or lessen competition substantially, the Bureau’s assessment of com-
petitive effects based on quantitative analysis and the application of relevant
factors, including the factors listed in section 93 of the Act, takes on greater
Guidelines
importance. Such an assessment falls under the broad categories of unilateral
effects and coordinated effects, as described below.
6.2 When it is clear that the level of effective competition that is to remain in the
relevant market is not likely to be reduced as a result of the merger, this alone
generally justifies a conclusion not to challenge the merger.
6.3 To determine the ability and effectiveness of remaining competitors to con-
strain an exercise of market power by the merged firm, the Bureau examines
existing forms of rivalry, such as discounting and other pricing strategies, dis-
tribution and marketing methods, product and package positioning, and ser-
vice offerings. Whether the market shares of firms are stable or fluctuate over
time is also relevant, as is the extent to which product differentiation affects
the degree of direct competition among firms. Further, the Bureau assesses
31 In addition to the CR4, the Bureau may examine changes in the Herfindahl-Hirschman
Index (“HHI”) (calculated by summing the squares of the individual market shares of all
market participants) to observe the relative change in concentration before and after a
merger. While the change in HHIs may provide useful information about changes in the
market structure, the Bureau does not use HHI levels to delineate any safe harbour threshold.
32 For example, historical or existing market shares may be less relevant in bidding markets
in which rapid fluctuations in market shares are more common. In such cases, the analysis
focuses on the likely future effectiveness of independent sources of competition, regardless
of their current shares. Bidding and bargaining markets are discussed in additional detail
under “Unilateral Effects” in Part 6.
609
whether competitors are likely to remain as vigorous and effective as they

were prior to the merger.
6.4 The extent and quality of excess capacity held by merging and non-merging
firms provides useful information about whether the merger could result in the
exercise of market power. Excess capacity held by rivals to the merged firm
improves their ability to expand output should the merged firm attempt to ex-
ercise market power. On the other hand, when the merged firm holds a signifi-
cant share of excess capacity in the relevant market, this may discourage rivals
from expanding.
6.5 The Bureau assesses the competitive attributes of the target business to deter-
mine whether the merger will likely result in the removal of a vigorous and
effective competitor.33 In addition to the forms of rivalry discussed above, the
Bureau’s assessment includes consideration of whether one of the merging
parties:
• has a history of not following price increases or market stabilizing initia-
tives by competitors, or of leading price reductions;
• provides unique service, warranty or other terms to the market;
• has recently expanded capacity or has plans to do so;
• has recently made gains in market share or is in a position to do so; or
• has recently acquired intellectual property rights or other inputs, or has
developed product features that enhance its ability to compete in the mar-
ket, or will soon do so.
6.6 While the removal of a vigorous and effective competitor through a merger is
likely to prevent or lessen competition to some degree, it may not, in itself,
provide a sufficient basis for a decision to challenge the merger. Additionally,
when a firm removed through a merger is not a vigorous or effective competi-
tor (e.g., owing to financial distress, or declining technologies or markets), this
fact is relevant to, but not determinative of, a decision not to challenge a
merger.
6.7 The Bureau evaluates the general nature and extent of change and innovation
in a market.34 In addition to assessing the competitive impact of technological
developments in products and processes, the Bureau examines change and in-
novation in relation to distribution, service, sales, marketing, packaging, buyer
33 See section 93(f) of the Act. A firm that is a vigorous and effective competitor often plays
an important role in pressuring other firms to compete more intensely with respect to ex-
isting products or in the development of new products. A firm does not have to be among the
larger competitors in a market in order to be a vigorous and effective competitor. Small firms
can exercise an influence on competition that is disproportionate to their size. Mavericks
(described in “Coordinated Effects,” in Part 6, below) are one type of vigorous and effective
competitor.
34 See section 93(g) of the Act.
610
tastes, purchase patterns, firm structure, the regulatory environment and the
economy as a whole.
6.8 The pressures exerted by change and innovation on competitors in a market
(including the merging parties) may be such that a material price increase is
unlikely to be sustainable, especially when technology or a merger reduces
barriers to entry or stimulates or accelerates the change or innovation in ques-
tion. Such pressures may have important implications for efficient markets in
the medium to long term.
6.9 A merger may facilitate the exercise of market power by impeding the process
of change and innovation. For example, when a merger eliminates an innova-
tive firm that presents a serious threat to incumbents, the merger may hinder
or delay the introduction of new products, processes, marketing approaches,
and aggressive research and development initiatives or business methods.
Unilateral Effects
6.10 By placing pricing and supply decisions under common control, a merger can
create an incentive to increase price and restrict supply or limit other dimen-
sions of competition. A unilateral exercise of market power occurs when the
merged firm can profitably sustain a material price increase without effective
discipline from competitive responses by rivals.
Guidelines
6.11 When buyers can choose from among many sellers offering comparable prod-
ucts, a firm’s ability to profitably increase its price is limited by buyers divert-
ing their purchases to substitute products in response to the price increase.
When two firms in a market merge and the price of one firm’s product(s) rises,
some demand may be diverted to product(s) of the firm’s merger partner,
thereby increasing the overall profitability of the price increase and providing
the impetus to raise the price. As such, the elimination of competition between
firms as a result of a merger may lessen competition substantially.
6.12 Unilateral effects can occur in various market environments, defined by the
primary characteristics that distinguish the firms within those markets and de-
termine the nature of their competition. Three types of market environment are
described below.
Firms in Differentiated Product Industries

6.13 In markets in which products are differentiated, a merger may create, enhance
or maintain the ability of the merged firm to exercise market power unilater-
ally when the product offerings of the merging parties are close substitutes for
one another. In such circumstances, the Bureau assesses how the merger may
change the pricing incentives of the individual firms.
6.14 Any firm considering increasing the prices for its products faces a trade-off
between higher profits on the sales that it continues to make following the
price increase and the profits that it loses on sales that it no longer makes
following the price increase, as buyers switch to other firms and/or other prod-
ucts. Any sales that were previously lost to the firm’s merging partner will be
611
captured by the merged firm (“diverted sales”). Thus, the incentives to raise
prices after the merger are greater the more closely the products of the merg-
ing firms compete with each other, and the larger the profit margins on these
diverted sales.
6.15 The closeness of competition between the merging firms’ products may be
measured by the diversion ratio between them.35 The value of the diverted
sales from one merging firm depends on the volume of diverted sales and the
profit margin on the diverted sales. The greater the value of the diverted sales,
the greater the incentive the merged firm has to raise prices.
6.16 The incentive to raise prices following the merger will typically be greater
when the products of the merging firms are close substitutes for a significant
number36 of buyers, when the merger removes a vigorous and effective com-
petitor from the market, or when buyers are not very sensitive to price in-
creases.37 These are not the only circumstances, however, when the Bureau
may be concerned with potential unilateral effects post-merger.
6.17 Even when the merging firms are found to have an incentive to increase price
after the merger, the likelihood of the merger preventing or lessening competi-
tion substantially also depends on the responses of buyers and rival firms. In
addition to considering the value of sales currently diverted to rivals, the Bu-
reau evaluates the likely competitive responses of rivals, including whether
rivals in the market are likely to expand production, reposition their products
or extend their product line to discipline unilateral market power that would
otherwise occur as a result of the merger.38 The Bureau also considers existing
sellers that may only occupy a particular niche within the relevant market and
whether they provide an alternative for a sufficient number of buyers. In addi-
tion, the likelihood and likely impact of entry is considered.
6.18 When assessing the extent of competition between the products of the merging
firms, the Bureau examines, among other possible factors, past buyer-switch-
ing behaviour in response to changes in relative prices, information based on
buyer preference surveys, win-loss records, and estimates of own-price and
cross-price elasticities.39
35 The diversion ratio between firm A’s product and firm B’s product is equal to the fraction
of sales lost by firm A to firm B when firm A raises the price of its product. Similarly, the
diversion ratio between firm B’s product and firm A’s product is equal to the fraction of
sales lost by firm B to firm A when firm B raises the price of its product. The diversion
ratios between firms A and B need not be symmetric.
36 A significant number” in this context need not approach a majority.
37 Buyer sensitivity to price increases may but need not be measured by the own-price elas-
ticity of demand.
38 This requires a determination of whether expansion, repositioning or product line exten-
sion will likely be deterred by risk, sunk costs or other entry barriers.
39 Refer to definitions of own-price and cross-price elasticity in paragraph 4.11, above.
612
Firms in Homogeneous Product Industries

6.19 A post-merger price increase may be profitable if the merger were to remove a
seller to whom buyers would otherwise turn in response to a price increase. In
markets in which products are relatively undifferentiated (that is, they are ho-
mogeneous), such a price increase is more likely to be profitable
• the greater the share of the relevant market the merged firm accounts for;
• the lower the margin on the output that the merged firm withholds from
the market to raise price;
• the less sensitive buyers are to price increases; and
• the smaller the response of other sellers offering close substitutes.
6.20 The response of other sellers will be smaller when they have insufficient ca-
pacity to increase sales to replace the output withheld by the merged firm post-
merger, or substantial amounts of capacity are committed to other buyers
under long-term contracts, and capacity cannot be expanded quickly and at
relatively low cost. Therefore, the Bureau examines, among other factors,
whether capacity constraints limit the effectiveness of remaining sellers by im-
peding their ability to make their products available in sufficient quantities to
counter an exercise of market power by the merged firm.
Bidding and Bargaining Markets
Guidelines
6.21 In some markets, sellers may interact with buyers through bidding or bargain-
ing for the right to supply. Buyers may negotiate with multiple sellers as a
means of using one seller to obtain a better price from another seller. Such
interactions may take the form of a pure auction or involve repeated rounds of
negotiation with a select group of sellers. A merger between two sellers will
prevent buyers from playing these two sellers off against each other to obtain a
better price.
6.22 The extent to which this loss of competition will affect the price paid by the
buyer depends on how close the merging firms are to each other relative to
other bidders and potential suppliers in meeting the buyer’s requirements.
When there are many bidders or potential suppliers that are equally or simi-
larly situated as the merging parties, a merger involving two sellers is unlikely
to prevent or lessen competition substantially.40
Coordinated Effects
6.23 A merger may prevent or lessen competition substantially when it facilitates or
encourages coordinated behaviour among firms after the merger. The Bu-
reau’s analysis of these coordinated effects entails determining how the
merger is likely to change the competitive dynamic in the market such that
40 As noted in footnote 32 above, historical or existing market shares may be less relevant in
bidding markets.
613
coordination is substantially more likely or effective. A lessening or preven-

tion of competition may result from coordinated behaviour even when the co-
ordination does not involve all the firms in the market.
6.24 Coordination involves interaction by a group of firms (including the merged
firm) that is profitable for each firm because of each firm’s accommodating
reactions to the conduct of the others. Coordinated behaviour may relate to
price, service levels, allocation of customers or territories, or any other dimen-
sion of competition.
6.25 Coordinated behaviour may involve tacit understandings that are not explicitly
negotiated or communicated among firms. Tacit understandings arise from
mutual yet independent recognition that firms can, under certain market condi-
tions, benefit from competing less aggressively with one another. Coordinated
behaviour may also involve express agreements among firms to compete less
vigorously or to refrain from competing. Such agreements may raise concerns
under the conspiracy and bid-rigging provisions of the Act.
6.26 Coordinated behaviour is likely to be sustainable only in the following circum-
stances:
• when firms are able to
• individually recognize mutually beneficial terms of coordination;
• monitor one another’s conduct and detect deviations from the terms
of coordination; and
• respond to any deviations from the terms of coordination through
credible deterrent mechanisms;41 and
• when coordination will not be threatened by external factors, such as the
reactions of existing and potential competitors not part of the coordinat-
ing group of firms or the reactions of buyers.
6.27 Competition is likely to be prevented or lessened substantially when a merger
materially increases the likelihood of coordinated behaviour when none ex-
isted before, or materially increases the extent or effectiveness of coordination
beyond that which already exists. When making this assessment, the Bureau
considers a number of factors, including the presence of factors necessary for
successful coordination and those that are conducive to coordination. The
mere presence of such factors, however, is not sufficient to conclude that there
are competition concerns. Rather, at issue is whether the merger impacts these
factors in such a way that makes coordination or more effective coordination
more likely.
41 These responses, typically known as punishments, may take the form of lowering prices
in the relevant market or in other markets.
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Market Concentration and Entry Barriers

6.28 Market power typically arises in markets characterized by concentration and
high barriers to entry. Market concentration is generally a necessary but not
sufficient condition for a merger to prevent or lessen competition substantially
through coordinated effects. Firms in a concentrated market typically find it
easier and less costly to engage in coordinated behaviour because it is easier
for members of a small group of firms to recognize terms of coordination, and
to monitor one another’s conduct and detect and respond to deviations. Barri-
ers to entry are also relevant, since coordinated behaviour among competitors
in a concentrated market would unlikely be sustainable if raising prices were
to lead to significant effective entry.
Indicia Suggesting that Market Conditions are Conducive to

Coordination
6.29 In its analysis of competitive effects, the Bureau examines whether market
conditions would likely allow coordinated behaviour to be sustainable after
the merger, with reference to the criteria outlined in paragraph 6.26, above.
While the presence of certain market conditions (often referred to as facilitat-
ing factors) may suggest the ability of firms to overcome impediments to coor-
dinated behaviour, neither the absence nor the presence of any single factor or
group of factors determines whether competition is likely to be prevented or
Guidelines
lessened substantially.
6.30 When examining whether firms are likely able to independently recognize mu-
tually beneficial terms of coordination, the Bureau considers, among other fac-
tors, the degree of product differentiation and cost symmetries among firms.
Recognizing terms of coordination that all firms find profitable is easier when
products are less differentiated and when firms have similar cost structures.
Complex products and differences in product offerings and cost structure tend
to make it more difficult for firms to reach profitable terms of coordination.
Similarly, markets with rapid and frequent product innovations, or that are in a
period of rapid growth, are less conducive to coordinated behaviour.
6.31 Profit-maximizing firms have an incentive to deviate from coordinated beha-
viour when the expected profits from deviating are greater than the expected
profits from engaging in coordination. Therefore, when evaluating whether co-
ordination is likely, the Bureau considers whether certain firms have stronger
incentives to deviate as well as factors that could affect incentives to deviate,
such as the size and frequency of transactions. When individual transactions
are large and infrequent relative to total market demand, deviations from coor-
dinated behaviour are more profitable, making effective coordinated behaviour
less likely. Additionally, when individual transactions are large relative to a
single firm’s total output, this will increase that firm’s incentive to deviate
from coordinated behaviour.42
42 These examples assume that coordination does not involve a customer allocation scheme.
615
6.32 The Bureau also considers whether firms can monitor and detect deviations
from coordinated behaviour. When so doing, the Bureau evaluates the degree
of market transparency that exists. When information about prices, rival firms
and market conditions is readily available to market participants, it is easier
for rivals to monitor one another’s behaviour, which in turn makes effective
coordination more likely. The existence of industry organizations that facili-
tate communication and dissemination of information among market partici-
pants may also make it easier for firms to coordinate their behaviour. A com-
plex, multi-stage procurement process may affect the ability of firms to detect
deviations from coordinated agreements. Also relevant to the analysis is the
stability of firms’ underlying costs, as well as the predictability of demand.
When costs fluctuate, it may be difficult to detect whether a price change rep-
resents a deviation from coordinated behaviour or whether it is a response to a
change in cost conditions, which, in turn, makes effective coordination less
likely. It may similarly be difficult to detect whether a price change represents
a deviation from coordinated behaviour when demand fluctuates
unexpectedly.
6.33 The Bureau’s evaluation of whether firms can impose credible punishments
includes assessing the degree of multi-market exposure among firms and of
excess capacity.43 When firms participate in multiple geographic or product
markets, there are greater opportunities for them to discourage deviation from
coordinated behaviour because there is broader scope for punishing devia-
tions. Similarly, excess capacity held by firms within the coordinating group
can allow such firms to oversupply the market when they detect deviations
from the coordinated price, thereby discouraging deviations and making coor-
dination more likely. However, excess capacity may also provide firms with
an incentive and an ability to deviate from coordinated behaviour by selling
products at lower prices. This could, in turn, make coordinated behaviour less
likely. It is therefore important to consider which firms, if any, hold excess
capacity as well as their individual economic incentives. A firm may also
adopt pricing policies, such as most-favoured customer clauses, that commit it
to following a low-pricing strategy when other firms reduce their prices.
6.34 A history of collusion or coordination in the market is also relevant to the
Bureau’s analysis, because previous and sustained collusive or coordinated be-
haviour indicates that firms have successfully overcome the hurdles to effec-
tive coordinated behaviour in the past.
43 This includes information about levels of service, innovation initiatives, product quality,
product choice and levels of advertising. Market transparency is typically increased by
posted pricing, circulation of price books, product, service or packaging standardization, ex-
changes of information regarding matters such as pricing, output, innovation, bids won and
lost, and advertising levels, through a trade association, trade publication or otherwise, pub-
lic disclosure of this information by buyers or through government sources, and “meet the
competition” or “most favoured customer” clauses in contracts.
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Impact of the Merger on Coordinated Behaviour

6.35 When assessing whether a merger increases the likelihood of coordination, the
Bureau considers whether the merger changes the competitive dynamic in a
market so as to make coordinated behaviour among firms more likely or effec-
tive. A merger that changes the competitive dynamic among firms may lead to
coordinated behaviour when none existed prior to the merger, or may materi-
ally increase the extent or effectiveness of coordination beyond that which al-
ready exists in a market. The Bureau determines whether market conditions
are conducive to coordination before the merger and whether the merger is
likely to increase the likelihood of coordination. The Bureau also identifies the
constraints on coordinated behaviour that existed before the merger to deter-
mine whether the merger reduces or eliminates those constraints.
6.36 In highly concentrated markets, effective coordination may be constrained by
the number of firms that exist before the merger. A merger could remove this
constraint by reducing the number of rivals to the point that the profitability of
coordination makes coordination a more achievable strategy than it was prior
to the merger.
6.37 When firms differ greatly from one another, effective coordination may be
constrained by their inability to behave in a way that each finds profitable.
When the effect of the merger is to reduce or eliminate asymmetries between
the merged firm and its key rivals, firms may find it easier to coordinate their
Guidelines
behaviour in a way that is profitable for each coordinating firm after the
merger. Conversely, a merger may increase asymmetries between the merged
firm and its rivals, thereby making coordinated behaviour less profitable and
therefore less likely.
6.38 Effective coordination may be constrained before the merger by the activities
of a particularly vigorous and effective competitor (a “maverick”). A maverick
is a firm that plays a disruptive role and provides a stimulus to competition in
the market. An acquisition of a maverick may remove this constraint on coor-
dination and, as such, increase the likelihood that coordinated behaviour will
be effective.
6.39 Alternatively, a merger may not remove a maverick but may instead inhibit a
maverick’s ability to expand or enter, or otherwise marginalize its competitive
significance, thereby increasing the likelihood of effective coordination.
PART 7: ENTRY
7.1 A key component of the Bureau’s analysis of competitive effects is whether
timely entry44 by potential competitors would likely occur on a sufficient
44 As noted previously, throughout these guidelines, the term “entry” also refers to expan-
sion by existing firms. The same factors that constrain new entrants also often constrain
617
scale and with sufficient scope to constrain a material price increase in the
relevant market. In the absence of impediments to entry, a merged firm’s at-
tempt to exercise market power, either unilaterally or through coordinated be-
haviour with its rivals, is likely to be thwarted by entry of firms that
• are already in the relevant market and can profitably expand production
or sales;
• are not in the relevant market but operate in other product or geographic
markets and can profitably switch production or sales into the relevant
market; or
• can profitably begin production or sales into the relevant market de novo.
Conditions of Entry
7.2 Entry is only effective in constraining the exercise of market power when it is
viable. When entry is likely, timely and sufficient in scale and scope, an at-
tempt to increase prices is not likely to be sustainable as buyers of the product
in question are able to turn to the new entrant as an alternative source of
supply.
Timeliness
7.3 The Bureau’s assessment of the conditions of entry involves determining the
time that it would take for a potential entrant to become an effective competi-
tor in response to a material price increase that is anticipated to arise as a
result of the merger. In general, the longer it takes for potential entrants to
become effective competitors, the less likely it is that incumbent firms will be
deterred from exercising market power. For that deterrent effect to occur, en-
trants must react and have an impact on price in a reasonable period of time.
In the Bureau’s analysis, the beneficial effects of entry on prices in this market
must occur quickly enough to deter or counteract any material price increase
owing to the merger, such that competition is not likely to be substantially
harmed.
Likelihood
7.4 When determining whether future entry is likely to occur, the Bureau gener-
ally starts by assessing firms that appear to have an entry advantage. While
other potential sources of competition may also be relevant, typically the most
important sources of potential competition are the following:
• fringe firms already in the market;
• firms that sell the relevant product in adjacent geographic areas;
significant expansion by fringe firms, even though in many cases expansion costs for ex-
isting firms may be lower than entry costs for a new entrant.
618
• firms that produce products with machinery or technology that is similar

to that used to produce the relevant product;
• firms that sell in related upstream or downstream markets;
• firms that sell through similar distribution channels; and
• firms that employ similar marketing and promotional methods.
7.5 A history of entry into and exit from a particular market provides insight into
the likelihood of entry occurring in a timely manner and on a sufficient scale
to counteract an exercise of market power by a merged firm. It is, however,
not the sole determinant of whether this would likely occur.
7.6 The Bureau seeks to determine the extent that entry is likely, given the com-
mitments that potential entrants must make, the time required to become effec-
tive competitors, the risks involved and the likely rewards. The Bureau consid-
ers any delay or loss that potential entrants expect to encounter before
becoming effective competitors, and the resulting sunk costs and risk associ-
ated with such entry that reduce the likelihood that entry will occur or be suc-
cessful. The Bureau also considers the expectations that potential entrants may
have of incumbent responses to entry, as well as the likelihood that customers
will support an entrant’s investments or guarantee it a needed volume of sales.
When assessing the likelihood of entry, the Bureau evaluates profitability at
post-entry prices, taking into account the effect that new supply would have on
Guidelines
market prices. These prices are often the pre-merger price levels. For instance,
if a competitor was able to enter a market only on a scale that is below the
minimum viable scale, the Bureau would not consider such entry to be likely,
since the entrant would be unable to achieve the annual level of sales neces-
sary to achieve profitability at post-entry prices.
Sufficiency
7.7 When considering whether entry is likely to be on a scale and scope that
would be sufficient to deter or counteract a material price increase, the Bureau
examines what would be required from potential competitors who choose to
enter. The Bureau will also consider any constraints or limitations on new en-
trants’ capacities or competitive effectiveness. Entry by firms that seek to dif-
ferentiate themselves by establishing a niche to avoid direct competition with
the merged firm may also not be sufficient to constrain an exercise of market
power.
Types of Barriers to Entry

7.8 Barriers to entry affect the timeliness, likelihood and sufficiency of entry.
They can take many forms, ranging from absolute restrictions that preclude
entry, to sunk costs and other factors that raise the costs and risks associated
619
with entry and thereby deter it.45 While, in some cases, each individual “bar-
rier” may be insufficient alone to impede entry, the Bureau considers the col-
lective influence of all barriers which, when taken together, can effectively
deter entry.
Regulatory Barriers
7.9 The types of barriers identified in section 93(d) of the Act — namely tariff and
non-tariff barriers to international trade, interprovincial barriers to trade and
regulatory control over entry — can provide incumbents with absolute cost ad-
vantages over potential entrants, presenting considerable and, in some cases,
insurmountable impediments to entry.
Sunk Costs
7.10 Substantial sunk costs directly affect the likelihood of entry and constitute a
significant barrier to entry. Costs are sunk when they are not recoverable if the
firm exits the market. In general, since entry decisions are typically made in an
environment in which success is uncertain, the likelihood of significant future
entry decreases as the absolute amount of sunk entry costs relative to the esti-
mated rewards of entry increases. The Bureau’s assessment of sunk costs also
focuses on the time required to become an effective competitor and the
probability of success, and whether these factors justify making the required
investments.
7.11 New entrants must often incur various start-up sunk costs, such as acquiring
market information, developing and testing product designs, installing equip-
ment, engaging personnel and setting up distribution systems. New entrants
may also face significant sunk costs owing to the need to
• make investments in market-specific assets and in learning how to opti-
mize the use of these assets;
• overcome product differentiation-related advantages enjoyed by incum-
bents; or
• overcome disadvantages presented by the strategic behaviour of
incumbents.
7.12 These potential sources of sunk costs can create significant impediments to
entry when they require that potential entrants factor greater costs into their
decision-making relative to incumbents who can ignore such costs in their
pricing decisions because they have already made their sunk cost commitment.
7.13 The investment required to establish a reputation as a reliable or quality seller
is also a sunk cost, constituting a barrier to entry when it is an important ele-
ment in attracting buyers, particularly in industries in which services are an
important element of the product. Under these circumstances, the time to es-
45 While commencing a business may in some cases be easy, new entrants may find it diffi-
cult to survive for a variety of reasons, including the strategic behaviour of incumbents.
620
tablish a good reputation may make profitable entry more difficult, and there-
fore delay the competitive impact that an entrant may have in the marketplace.
7.14 Long-term exclusive contracts with automatic renewals, rights of first refusal,
most favoured customer or “meet or release” clauses or termination fees may
constitute barriers to entry. Contracts with attributes that limit buyer switching
may make it difficult for firms to gain a sufficient buyer base to be profitable
in one or more markets (even when barriers to entry in the industry are other-
wise relatively low) and can thus make entry unattractive. The deterring ef-
fects of such contracts are more pronounced when, for example, economies of
density or scale are important and make it difficult for new or smaller firms to
achieve a minimum efficient scale of operations.
Other Factors That Deter Entry

7.15 In markets in which economies of scale are significant, entry on a small scale
may be difficult unless the entrant can successfully exploit a niche. Con-
versely, entry in such markets on a large scale may expand available capacity
to supply beyond market demand, thereby depressing market prices and mak-
ing entry less attractive.
7.16 Market maturity can also impede entry. Entry may be less difficult and time-
consuming in the start-up and growth stages of a market, when the dynamics
Guidelines
of competition generally change more rapidly. Mature markets exhibit flat or
declining demand, making it more difficult for potential entrants to profitably
enter the business because the entrants’ sales have to come from existing
rivals.
7.17 Other cost advantages for incumbents that may deter entry include those re-
lated to transportation costs, control over access to scarce or non-duplicable
resources such as technology, land, natural resources and distribution chan-
nels, network effects, and capital costs.46
PART 8: COUNTERVAILING POWER

8.1 When determining whether a merger is likely to result in a material price in-
crease, the Bureau assesses whether buyers are able to constrain the ability of
a seller to exercise market power. This may occur when, for example,
• they can self-supply through vertical integration into the upstream
market;
• the promise of substantial orders can induce expansion of an existing
smaller supplier and/or can sponsor entry by a potential supplier not cur-
rently in the market;
46 The need to raise capital may have a significant impact on the likelihood and timeliness of
entry.
621
• they can refuse to buy other products produced by the seller;

• they can refuse to purchase the seller’s products in other geographic mar-
kets where the competitive conditions are different; or
• they can impose costs on the seller (for example, by giving less favour-
able retail placement to the merged entity’s products).
8.2 The Bureau does not presume that a buyer has the ability to exercise counter-
vailing power merely by virtue of its size. There must be evidence that a
buyer, regardless of size, will have the ability and incentive to constrain an
exercise of market power by the merged firm. Evidence of prior dealings be-
tween the buyer and one or more of the merging parties that tends to demon-
strate the buyer’s relative bargaining strength is of particular relevance. The
Bureau also considers the extent to which the merger affects the buyer’s abil-
ity and incentive to exercise countervailing power. When a merger eliminates
a supplier whose presence contributed significantly to a buyer’s historical bar-
gaining strength, the buyer may no longer be able to exercise countervailing
power after the merger.
8.3 When price discrimination is a feature of the relevant market, it may be possi-
ble for some but not all buyers to counter the effects of an exercise of market
power. For example, a merged firm may be able to increase prices to buyers
that do not have the option to vertically integrate their operations, while other
buyers with this option may be able to resist such a price increase. Where only
a subset of buyers is able to counter a price increase or other exercise of mar-
ket power, the Bureau will generally find that countervailing power is insuffi-
cient to prevent the merged firm from exercising market power in the relevant
market.
PART 9: MONOPSONY POWER

9.1 A merger of competing buyers may create or enhance the ability of the merged
firm, unilaterally or in coordination with other firms, to exercise monopsony
power. The Bureau is generally concerned with monopsony power when a
buyer holds market power in the relevant purchasing market, such that it has
the ability to decrease the price of a relevant product below competitive levels
with a corresponding reduction in the overall quantity of the input produced or
supplied in a relevant market, or a corresponding reduction in any other di-
mension of competition.47
47 Cases where the supply curve is perfectly inelastic, such that a price decrease below com-
petitive levels does not result in a decrease in output but only a wealth transfer, may also
give rise to concerns. This scenario should be understood to be generally included in the
category of monopsony. Similarly, an output effect is not required in monopoly cases.
622
9.2 Consistent with its general analytical framework for merger review, the Bu-
reau considers both market definition-based and other evidence of competitive
effects in monopsony cases. The conceptual basis used for defining relevant
markets is, mirroring the selling side, the hypothetical monopsonist test. A
relevant market is defined as the smallest group of products and the smallest
geographic area in which a sole profit-maximizing buyer (a “hypothetical
monopsonist”) would impose and sustain a significant and non-transitory price
decrease below levels that would likely exist in the absence of the merger. The
relevant product market definition question is thus whether suppliers, in re-
sponse to a decrease in the price of an input, would switch to alternative buy-
ers or reposition or modify the product they sell in sufficient quantity to render
the hypothetical monopsonist’s price decrease unprofitable.
9.3 In order to determine market shares and concentration levels, the Bureau com-
pares the size of the purchases of the relevant product by the merging parties
with the total sales of the relevant product. When the merging parties represent
only a small percentage of the total purchases of the relevant product, the Bu-
reau generally considers the suppliers to be well-placed to forego sales to the
merging parties in favour of other buyers when faced with an attempt to lower
prices. As a general rule, the Bureau will not challenge a merger based on
monopsony (or oligopsony) power concerns where shares of the relevant up-
stream market held by the merging parties (and their competitors, in an oligop-
Guidelines
sony case) fall below the market share safe harbours set out in Part 5 of these
guidelines. When the merging parties account for a significant portion of
purchases of the relevant product and exceed these market share safe harbours,
then it is more likely that the merging parties could exercise monopsony
power. In this case, the Bureau considers barriers to entry that may limit or
negate the ability of a new buyer to purchase the product, or of an existing
buyer to expand its purchases (see Part 7 for a detailed discussion of the Bu-
reau’s approach to assessing entry).
9.4 When the merged firm accounts for a significant portion of purchases of the
relevant product, and barriers to buying the input are high, the factors that the
Bureau considers when attempting to determine whether the merged firm is
likely to have the ability to exercise monopsony power include the following:
• whether the merged firm can restrict its purchases by an amount that is
large enough to reduce the relevant product’s price in the market;
• whether upstream supply of the relevant product is characterized by a
large number of sellers and low barriers to entry into buying such that the
normal selling price of a supplier is likely competitive;
• whether it seems likely that certain suppliers will exit the market or oth-
erwise reduce production, or will reduce investments in new products and
processes in response to the anticipated price decrease;
• whether a reduction in the merged firm’s purchases of the relevant (input)
product is likely to reduce the profits earned by the merged firm in down-
stream output markets, and, if so, whether the downstream output profit
623
reduction is large enough to reduce the merged firm’s incentive to restrict

its purchases; and
• whether a reduction in the merged firm’s purchases of the relevant prod-
uct is likely to reduce its access to adequate supply of the relevant prod-
uct in the long run.
9.5 When available, the Bureau considers empirical evidence to analyze the effect
of historical changes in supply on price and quantity as part of the assessment
of whether the merging parties would have the ability to exercise monopsony
power.
PART 10: MINORITY INTEREST TRANSACTIONS AND

INTERLOCKING DIRECTORATES
10.1 Part 1, above, outlines the factors the Bureau considers when determining
whether a minority interest transaction or interlocking directorate confers the
requisite level of influence to constitute a merger. Additionally, a minority
interest or interlocking directorate may be ancillary to a merger that the Bu-
reau is otherwise reviewing (e.g., when one of the merging parties holds a
minority interest in a third competitor prior to the merger).48 This Part outlines
the Bureau’s approach to minority interest transactions where the Bureau has
jurisdiction under the merger provisions of the Act.
10.2 The Bureau’s analysis of minority interests and interlocks that are determined
to be mergers under Part 1 of these guidelines involves two distinct steps:
• First, the Bureau conducts a preliminary examination of the transaction as
a full merger between the acquirer and the target firm. This exercise is
used to screen out benign cases. When the Bureau concludes that a full
merger would not likely prevent or lessen competition substantially49,
48 As noted in paragraph 1.16, above, an interlocking directorate alone would rarely consti-
tute a merger although it could; however, interlocks are often features of partial interest
transactions that otherwise qualify as a merger. The Bureau considers features of any inter-
lock in its assessment of the competitive effects of a merger. Of particular relevance are the
following factors: relationship between the interlocked firms, the role and duty of the inter-
locked director toward the interlocked firms, board composition and the position of the inter-
locked director on the boards, information to which the interlocked director has access, any
special powers of the interlocked director, including voting or veto rights, and any contrac-
tual or practical mechanisms that the interlocked director might use to influence firm policies
or decision-making.
49 As noted below in paragraph 12.3, in reviewing a full merger the Bureau may make an
assessment of whether the efficiency gains that are likely to be brought about by the merger
will be greater than and will offset the anti-competitive effects of that merger. By contrast,
minority interest transactions typically do not involve the integration of firms and therefore
efficiency gains are not typically considered by the Bureau in reviewing minority interests.
624
then a more detailed analysis of the minority interest or interlocking di-

rectorate is not generally required.
• When, based on its preliminary examination, the Bureau determines that
a full merger would raise possible competition concerns, it then moves to
the second step in its analysis, in which it (1) examines the specific na-
ture and impact of the minority shareholding and/or interlocking director-
ate; and (2) conducts a detailed examination of the likely competitive ef-
fects arising from the minority shareholding and/or interlocking
directorate.
10.3 A minority interest or interlocking directorate may impact competition by af-
fecting the pricing or other competitive incentives of the target, the acquirer or
both. Note that, with respect to interlocking directorates, the Bureau is not
generally concerned when board representation in these circumstances occurs
solely through “independent” directors when the businesses do not compete.
10.4 When assessing the target’s pricing or other competitive incentives, the Bu-
reau first considers whether, by virtue of its ability to materially influence the
economic behaviour of the target business, the acquirer or interlocked director
may induce the target business to compete less aggressively. The Bureau also
considers the extent of such influence and the likelihood that competition will
be prevented or lessened as a result of its exercise.
Guidelines
10.5 Second, the Bureau considers whether the transaction provides the acquirer or
the firm with the interlocked director access to confidential information about
the target business. In particular, the Bureau examines the likelihood that such
access may facilitate coordination between the two firms, may affect the uni-
lateral competitive conduct of the firm that receives the information, or both.
10.6 With respect to the acquirer, the Bureau considers whether a minority interest
or interlock may result in a change to the acquirer’s pricing or other competi-
tive incentives. A firm that holds a minority position in a target business that is
a competitor might have a reduced incentive to compete with the target busi-
ness because if the acquirer raises its price and consequently loses sales, it will
benefit, through its minority interest, from sales that flow to the target busi-
ness. In effect, the acquirer will recapture some of the sales diverted to the
target business and may thus have a greater incentive to raise its own price
than it would absent the minority interest. In its assessment, the Bureau con-
siders the extent of diversion between the acquiring and target firms’ products
and the profits earned on these diverted sales. The Bureau also examines the
likelihood, significance and impact of any such change to the incentives of the
acquirer.
PART 11: NON-HORIZONTAL MERGERS

11.1 A horizontal merger is a merger between firms that supply competing prod-
ucts. By contrast, non-horizontal mergers involve firms that do not supply
625
competing products. The two main types of non-horizontal mergers are verti-
cal mergers and conglomerate mergers. A vertical merger is a merger between
firms that produce products at different levels of a supply chain (e.g., a merger
between a supplier and a customer). A conglomerate merger is a merger be-
tween parties whose products do not compete, actually or potentially50, and
are not vertically related. Conglomerate mergers may involve products that are
related because they are complementary (e.g., printers and ink cartridges),51 or
because customers buy them together owing to purchasing economies of scale
or scope.
11.2 Non-horizontal mergers are generally less likely to prevent or lessen competi-
tion substantially than are horizontal mergers. This is because non-horizontal
mergers may not entail the loss of competition between the merging firms in a
relevant market. Non-horizontal mergers also frequently create significant ef-
ficiencies.52 However, non-horizontal mergers may reduce competition in
some circumstances, as outlined below.
11.3 The civil provisions of the Act may be available to address conduct by the
merged firm that constitutes a refusal to deal, an abuse of dominance or other
reviewable conduct. However, where the Bureau is able to remedy or enjoin a
merger that is likely to substantially prevent or lessen competition, it will gen-
erally do so in preference to pursuing post-merger remedies under other provi-
sions of the Act.
Unilateral Effects of Non-Horizontal Mergers

11.4 A non-horizontal merger may harm competition if the merged firm is able to
limit or eliminate rival firms’ access to inputs or markets, thereby reducing or
eliminating rival firms’ ability or incentive to compete. The ability to affect
rivals (and, by extension, competition) in this manner is referred to in these
guidelines as “foreclosure.”
11.5 Foreclosure may be partial when the merged firm, for example, raises its price
to a downstream competitor, thereby raising its rival’s costs. Foreclosure may
be complete when the merged firm, for example, refuses to supply a down-
stream competitor.
50 Mergers between potential competitors are dealt with as prevention of competition cases.
See paragraphs 2.10–2.12 above.
51 That is, the goods are economic complements, such that the quantity demanded of one
product decreases as the price of the other increases.
52 For example, a vertical merger may allow the merged firm to remove or “internalize”
existing double marginalization, since there is no longer any need for a mark-up on goods
from the upstream firm to its downstream merger partner. With conglomerate mergers, the
merged firm may be able to internalize the positive effect of a decrease in the price of one
complementary product on the sales of another complementary product. This in turn may
increase the output of both products, which is, all other things being equal, pro-competitive.
626
11.6 When examining the likely foreclosure effects of a non-horizontal merger

transaction, the Bureau considers three inter-related questions: (1) whether the
merged firm has the ability to harm rivals; (2) whether the merged firm has the
incentive (i.e., whether it is profitable) to do so; and (3) whether the merged
firm’s actions would be sufficient to prevent or lessen competition
substantially.
11.7 In the case of vertical mergers, the Bureau looks at four main categories of
foreclosure:
• total input foreclosure, which occurs when the merged firm refuses to
supply an input to rival manufacturers that compete with it in the down-
stream market;
• partial input foreclosure, which occurs when the merged firm increases
the price it charges to supply an input to rival manufacturers that compete
with it in the downstream market;53
• total customer foreclosure, which occurs when the merged firm refuses to
purchase inputs from an upstream rival; and
• partial customer foreclosure, which occurs when the merged firm is a dis-
tributor and can disadvantage upstream rivals in the distribution/resale of
their products.
11.8 In the case of a conglomerate merger, the Bureau considers whether the com-
Guidelines
bination of products in related markets will confer upon the merged firm the
ability and incentive to leverage a strong market position from one market to
another by means of tying products together. For example, the merged firm
may harm its rivals by refusing to sell one product to customers unless cus-
tomers also buy a second product from it. Assuming that rivals do not sell the
same range of products as the merged firm, such tying may foreclose rivals by
reducing their ability to compete, thereby preventing or lessening competition
substantially.
Coordinated Effects of Non-Horizontal Mergers

11.9 The Bureau also considers whether a non-horizontal merger increases the like-
lihood of coordinated interaction among firms:
• A merger that leads to a high degree of vertical integration between an
upstream market and a downstream retail market, or increases the degree
of existing vertical integration, can facilitate coordinated behaviour by
firms in the upstream market by making it easier to monitor the prices
rivals charge upstream. Vertical mergers could also facilitate coordinated
behaviour by firms in a downstream market by increasing transparency
53 Foreclosure may also be accomplished through non-price means. For example, a merged
firm may adopt product standards that are incompatible with those used by rivals, thus re-
quiring rivals to invest in new standards in order to continue to purchase the merged firm’s
product or making it impossible for rivals to use the merged firm’s product altogether.
627
(by enabling firms to observe increased purchases of inputs) or by pro-

viding additional ways to discourage or punish deviations (by limiting the
supply of inputs).
• A conglomerate merger may facilitate coordination by increasing the de-
gree of multi-market exposure among firms (see paragraph 6.33, above).
PART 12: THE EFFICIENCY EXCEPTION

Overview
12.1 Section 96 of the Act provides an efficiency exception to the provisions of
section 92. When a merger creates, maintains or enhances market power, sec-
tion 96(1) creates a trade-off framework in which efficiency gains that are
likely to be brought about by a merger are evaluated against the anti-competi-
tive effects that are likely to result. It should be noted that the Bureau’s ap-
proach is to expeditiously identify those few transactions that may raise mate-
rial competition concerns and provide quick clearance for remaining
transactions to provide commercial certainty and allow parties to achieve any
efficiencies as quickly as possible. Consistent with that approach, a thorough
assessment of efficiency claims is unnecessary in the vast majority of the Bu-
reau’s merger reviews.
12.2 As the starting point, when determining the relevant anti-competitive effects
for the purpose of performing the trade-off, the Bureau recognizes the signifi-
cance of all of the objectives set out in the statutory purpose clause contained
in section 1.1 of the Act.
12.3 The Bureau, in appropriate cases and when provided in a timely manner with
the parties’ evidence substantiating their case, makes an assessment of
whether the efficiency gains that are likely to be brought about by a merger
will be greater than and will offset the anti-competitive effects arising from
that merger, and will not necessarily resort to the Tribunal for adjudication of
the issue. However, the parties must be able to validate efficiency claims to
allow the Bureau to ascertain the nature, magnitude, likelihood and timeliness
of the asserted gains, and to credit (or not) the basis on which the claims are
being made.
12.4 In general, categories of efficiencies that are relevant to the trade-off analysis
in merger review include the following:
• allocative efficiency: the degree to which resources available to society
are allocated to their most valuable use;
• technical (productive) efficiency: the creation of a given volume of out-
put at the lowest possible resource cost; and
• dynamic efficiency: the optimal introduction of new products and pro-
duction processes over time.
12.5 These categories are examined in reference to both gains in efficiency and
anti-competitive effects (which include losses in efficiency).
628
12.6 For the purpose of the trade-off analysis in litigated proceedings before the
Tribunal, the Bureau must show the anti-competitive effects of a merger. As
outlined in more detail in paragraph 12.13 below, the merging parties must
show all other aspects of the trade-off, including the nature, magnitude, likeli-
hood and timeliness of efficiency gains, and whether such gains are greater
than and offset the anti-competitive effects. Whether or not a case proceeds to
litigation, the Bureau seeks information from the merging parties and other
sources to evaluate gains in efficiencies and anti-competitive effects.
12.7 By incorporating an explicit exception for efficiency gains, Parliament has in-
dicated that the assessment of the competitive effects of the merger under sec-
tion 92 of the Act is to be segregated from the evaluation of efficiency gains
under section 96. That said, cost savings from substantiated efficiency gains
may be relevant to the analysis under section 92 of whether the merger is
likely to prevent or lessen competition substantially in the following limited
sense: the Bureau considers whether, as a result of true cost savings (discussed
below under “Types of Efficiencies Generally Included in the Trade-Off”), the
parties to the merger are better positioned to compete in a competitive market
or are less likely to engage in coordinated behaviour.54
12.8 Where efficiencies may be material, merging parties are encouraged to make
their efficiency submissions to the Bureau as early as possible in the merger
review process. This facilitates an expeditious assessment of the nature, mag-
Guidelines
nitude, likelihood and timeliness of the efficiency gains and of the trade-off
between relevant efficiency gains and anti-competitive effects. Having de-
tailed information regarding efficiency claims at an early stage of the process
will facilitate the preparation of focused follow-up information requests and/or
the targeted use of other information-gathering mechanisms and, subject to
confidentiality restrictions, enable the Bureau to test the claims during its mar-
ket contacts regarding the merger. Submissions regarding anticipated effi-
ciency gains may also assist the Bureau in understanding the rationale under-
lying the proposed transaction.
Gains in Efficiency
12.9 To be considered under section 96(1), it must be demonstrated that the effi-
ciency gains “would not likely be attained if the order (before the Tribunal)
were made.” This involves considering the nature of potential orders that may
be made, including those that may apply to the merger in its entirety or are
limited to parts of the merger. Each of the anticipated efficiency gains is then
assessed to determine whether these gains would likely be attained by alterna-
tive means if the potential orders are made. Where the order sought is limited
to parts of a merger, efficiency gains that are not affected by the order are not
included in the trade-off analysis.
54 The impact of efficiencies on a firm’s cost structure may render coordination more diffi-
cult by enhancing its incentive to compete more vigorously.
629
12.10 To facilitate the Bureau’s review of efficiency claims, parties should provide
detailed and comprehensive information that substantiates the precise nature,
magnitude, likelihood and timeliness of their alleged efficiency gains, as well
as information relating to deductions from gains in efficiency, such as the
costs associated with implementing the merger. The information should spe-
cifically address the likelihood that such gains would be achieved and why
those gains would not likely be achieved if the potential Tribunal orders were
made.
12.11 Typically, the Bureau uses industry experts to assist in its evaluation of effi-
ciency claims. To assess efficiency claims, Bureau officers and economists, as
well as experts retained by the Bureau, require access to detailed financial and
other information.55 To enable the objective verification of anticipated effi-
ciency gains, efficiency claims should be substantiated by documentation pre-
pared in the ordinary course of business, wherever possible. This includes
plant and firm-level accounting statements, internal studies, strategic plans, in-
tegration plans, management consultant studies and other available data. The
Bureau may also require physical access to certain facilities and will likely
require documents and information from operations-level personnel who can
address, among other matters, how their business is currently run and areas
where efficiencies would likely be realized.
12.12 Section 96(2) requires the Tribunal to consider whether the merger is likely
to bring about gains in efficiency described in section 96(1) that will result in
(1) a significant increase in the real value of exports; or (2) a significant sub-
stitution of domestic products for imported products. To assist this analysis,
firms operating in markets that involve international trade should provide the
Bureau with information that establishes that the merger will lead them to in-
crease output owing to greater exports or import substitution.56
Burden on the Parties

12.13 The parties’ burden includes proving that the gains in efficiency
• are likely to occur. In other words, the parties must provide a detailed
explanation of how the merger or proposed merger would allow the
merged firm to achieve the gains in efficiency. In doing so, the parties
must specify the steps they anticipate taking to achieve the gains in effi-
ciency, the risks involved in achieving these gains and the time and costs
required to achieve them.
55 This includes all pre-existing merger planning documents. Additional information that
may be relevant includes (1) information on efficiencies realized from previous mergers in-
volving similar assets; (2) pre-merger documents relating to product and process innovation;
and (3) information related to economies of scale, including minimum efficient scale, and
economies of scope in production.
56 Increased output in this context is generally only possible with an associated decrease in
price.
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• are brought about by the merger or proposed merger (i.e., that they are
merger-specific). The test under section 96(1) is whether the efficiency
gains would likely be realized in the absence of the merger. Thus, if cer-
tain gains in efficiency would likely be achieved absent the merger, those
gains are not counted for the purposes of the trade-off.
• are greater than and offset the anti-competitive effects. The parties must
provide a quantification of the gains in efficiency and a detailed and ro-
bust explanation of how the quantification was calculated. They should
also, to the extent relevant, provide any information on qualitative effi-
ciencies. While the burden is ultimately on the parties to establish that the
gains in efficiency are greater than and offset the anti-competitive effects,
in appropriate cases and when provided in a timely manner with the par-
ties’ evidence substantiating their case, the Bureau undertakes its own
internal assessment of the trade-off before deciding whether to challenge
a merger at the Tribunal.
• would not likely be attained if an order under section 92 were made.
Gains in efficiency that would likely be achieved, even if an order
prohibiting all or part of the merger were made, are not counted for the
purposes of section 96.57
Types of Efficiencies Generally Included in the Trade-Off: Gains in
Guidelines
Productive Efficiency
12.14 Productive efficiencies result from real cost savings in resources, which per-
mit firms to produce more output or better quality output from the same
amount of input. In many cases, such efficiencies can be quantifiably mea-
sured, objectively ascertained, and supported by engineering, accounting or
other data, subject to a discount, as appropriate, for likelihood in practice.
Timing differences in the realization of these savings are accounted for by
discounting to the present value.
12.15 Productive efficiencies include the following:
• cost savings at the product, plant and multi-plant levels;
• savings associated with integrating new activities within the firm;58 and
57 For example, if remedying a substantial prevention or lessening of competition required

divestitures only in certain markets, cost savings resulting from the rationalization of head
office facilities would not be included in the trade-off, assuming that such savings would be
achievable despite the divestitures. A portion of head office cost savings may be relevant in
this example only if the parties can clearly demonstrate that those cost savings would not be
achievable if the proposed remedy is granted. Only those gains in efficiency that will be
forgone as a result of the remedy will be counted.
58 These include reduced transaction costs associated with contracting for inputs, distribu-
tion and services that were previously performed by third parties, but exclude pecuniary
savings such as those related to bringing idle equipment into use if such idle capacity will be
transferred from the merged firm to third parties.
631
• savings arising from transferring superior production techniques and

know-how from one of the merging parties to the other.59
12.16 Information respecting gains in efficiency that relate to cost savings should
be broken down according to whether they are one-time savings or a recurring
savings. When considering cost savings, the Bureau examines claims related
to the following:
• economies of scale: savings that arise from product- and plant-level re-
ductions in the average unit cost of a product through increased
production;
• economies of scope: savings that arise when the cost of producing more
than one product at a given level of output is reduced by producing the
products together rather than separately;
• economies of density: savings that arise from more intensive use of a
given network infrastructure;
• savings that flow from specialization, the elimination of duplication, re-
duced downtime, a smaller base of spare parts, smaller inventory require-
ments and the avoidance of capital expenditures that would otherwise
have been required;
• savings that arise from plant specialization, the rationalization of various
administrative and management functions (e.g., sales, marketing, ac-
counting, purchasing, finance, production), and the rationalization of re-
search and development activities; and
• savings that relate to distribution, advertising and raising capital.
Types of Efficiencies Generally Included in the Trade-Off: Gains in

Dynamic Efficiency
12.17 The Bureau also examines claims that the merger has or is likely to result in
gains in dynamic efficiency, including those attained through the optimal in-
troduction of new products, the development of more efficient productive
processes, and the improvement of product quality and service. When possi-
ble, the assessment of dynamic efficiencies is conducted on a quantitative ba-
sis. This is generally the case if there is information presented by the parties to
suggest that a decrease in production costs as a result of an innovation in pro-
duction technology or an increase in demand for the parties’ products as a
result of product innovation (leading to a new or improved product) is likely.
To supplement quantitative information or where quantitative information is
absent, the Bureau conducts a qualitative assessment.
59 While such legitimate production-related savings may exist, it will generally be difficult
to demonstrate that efficiencies will arise owing to “superior management,” that savings are
specifically attributable to management performance or that they would not likely be sought
and attained through alternative means.
632
12.18 The specific environment of the industry in question is important in the Bu-
reau’s analysis of the competitive effects of a merger on innovation. In light of
the complexities and uncertainties associated with the assessment of dynamic
efficiency claims, irrespective of the industry, certain types of industry infor-
mation (in addition to that considered in paragraphs 12.10 and 12.11, above)
can be particularly beneficial to the Bureau’s assessment of a merger’s impact
on innovation as they relate to, for example, verifiability, likelihood of success
and timeliness. Historical information on the effect of previous mergers in the
industry on innovation may be insightful.60 Such information may relate to a
merger’s impact on the nature and scope of research and development activi-
ties, innovation successes relating to new or existing products or production
processes, and the enhancement of dynamic competition.61 In addition, and
only when applicable, the Bureau encourages parties to provide detailed expla-
nations regarding plans to utilize substitute or complementary technologies so
as to increase innovation.
Types of Efficiencies Generally Included in the Trade-Off: Deductions

to Gains
12.19 Once all efficiency claims have been valued, the costs of retooling and other
costs that must be incurred to achieve efficiency gains are deducted from the
total value of the efficiency gains that are considered pursuant to section
Guidelines
96(1). Integrating two complex, ongoing operations with different organiza-
tional cultures can be a costly undertaking and ultimately may be unsuccess-
ful. Integration costs are deducted from the efficiency gains.62
Types of Efficiencies Generally Excluded from the Trade-Off

12.20 Not all efficiency claims qualify for the trade-off analysis. The Bureau ex-
cludes the following:
• gains that would likely be attained in any event through alternative means
if the potential orders were made (examples include internal growth, a
60 Such information may be useful even when previous mergers did not necessarily involve
any of the merging parties, since Bureau staff will examine the effect of past industry merg-
ers on innovation through various sources of information, including industry experts and
interviews with competitors.
61 In this context, dynamic competition refers to competition based on the successive intro-
duction of new or better products over time.
62 Losses in dynamic efficiency described in paragraph 12.31, below, may also be deducted
from gains in efficiency at this stage of the analysis, provided they are not double-counted.
633
merger with a third party,63 a joint venture, a specialization agreement,

and a licensing, lease or other contractual arrangement);64
• gains that would not be affected by an order, when the order sought is
limited to part of a merger;
• gains that are redistributive in nature, as provided in section 96(3) of the
Act (examples include gains anticipated to arise from increased bargain-
ing leverage that enables the merging parties to extract wage concessions
or discounts from suppliers that are not cost-justified, and tax-related
gains);65
• gains that are achieved outside Canada (examples include productive effi-
ciency gains arising from the rationalization of the parties’ facilities lo-
cated outside Canada that do not benefit the Canadian economy);66 and
• savings resulting from a reduction in output, service, quality or product
choice.
Anti-Competitive Effects
12.21 Section 96(1) requires efficiency gains to be evaluated against “the effects of
any prevention or lessening of competition that will result or is likely to result
from the merger or proposed merger.” The effects to be considered are not
limited to resource allocation effects and include all the anti-competitive ef-
fects that are likely to arise from a merger, having regard to all of the objec-
tives of the Act. Determination of the relevant anti-competitive effects de-
pends upon the particular circumstances of the merger in question and the
markets affected by the merger.
63 Consideration will only be given to alternative merger proposals that could reasonably be
considered practical given the business realities faced by the merging firms.
64 The market realities of the industry in question will be considered in determining whether
particular efficiencies could reasonably be expected to be achieved through non-merger al-
ternatives. This includes growth prospects for the market in question, the extent of excess
capacity in the market, and the extent to which the expansion can be carried out in
increments.
65 Discounts from a supplier resulting from larger orders that would enable the supplier to
achieve economies of scale, reduced transaction costs or other savings may qualify, to the
extent that the savings by the supplier can be substantiated. Mere redistribution of income
from the supplier to the merged firm in the form of volume or other discounts is not an
efficiency.
66 A rationalization of the parties’ facilities located outside of Canada where it could be
established that these efficiencies would likely result in lower prices in Canada is an example
of how such gains in efficiency from non-Canadian sources could accrue to the Canadian
economy. The issue is whether the efficiency gains will benefit the Canadian economy rather
than the nationality of ownership of the company.
634
12.22 The Bureau examines all relevant price and non-price effects, including neg-
ative effects on allocative, productive and dynamic efficiency; redistributive
effects; and effects on service, quality and product choice.
12.23 In addition to direct effects in the relevant market, the Bureau also considers
price and non-price effects in interrelated markets. For example, mergers that
are likely to result in increased prices and lower output can impair industries
that use the merged firm’s products as inputs.
12.24 Some examples of potential anti-competitive effects that can result from a
merger are described below. This list is not intended to be exhaustive. While,
in some cases, the negative impacts of a merger may be difficult to measure,
all of the relevant anti-competitive effects of a merger are considered for the
purposes of the trade-off. When anti-competitive effects (such as redistributive
effects and non-price effects) cannot be quantified, they are considered from a
qualitative perspective.
Price Effects: Loss of Allocative Efficiency (Deadweight Loss)

12.25 A merger that results in a price increase generally brings about a negative
resource allocation effect (referred to as “deadweight loss”), which is a reduc-
tion in total consumer and producer surplus within Canada. This reflects a loss
of allocative efficiency that is contrary to promoting the efficiency and adapta-
Guidelines
bility of the Canadian economy.
12.26 In view of the difficulties associated with estimating the magnitude of a ma-
terial price increase that is likely to be brought about by a merger and other
variables, various estimates of the deadweight loss are usually prepared over a
range of price increases and market demand elasticities.
12.27 The estimate of deadweight loss generally includes the following:
• losses to consumer surplus resulting from reductions in output owing to
the merger;
• losses in producer surplus that arise when market power is being exer-
cised in the relevant market prior to the merger67; and
• losses to consumer and producer surplus anticipated to result in interre-
lated markets.68
67 When pre-merger conditions are not competitive, the deadweight loss arising from a
merger may be significantly understated if this loss to producer surplus is not taken into
account.
68 For example, when the products produced by the merged firm include intermediate goods
that are used as inputs in other products, price increases in the intermediate goods can con-
tribute to allocative inefficiency in interrelated markets.
635
Price Effects: Redistributive Effects

12.28 Price increases resulting from an anti-competitive merger cause a redistribu-
tive effect (“wealth transfer”) from buyers to sellers. Providing buyers with
competitive prices and product choices is an objective of the Act.
Non-Price Effects: Reduction in Service, Quality, Choice

12.29 A substantial prevention or lessening of competition resulting from a merger
can have a negative impact on service, quality, product choice and other dimen-
sions of competition that buyers value. Considering these effects is consistent with
ensuring that buyers are provided with competitive prices and product choices.
Non-Price Effects: Loss of Productive Efficiency

12.30 Mergers that prevent or lessen competition substantially can also reduce pro-
ductive efficiency, as resources are dissipated through x-inefficiency69 and
other distortions.70 For instance, x-inefficiency may arise when firms, particu-
larly in monopoly or near monopoly markets, are insulated from competitive
market pressure to exert maximum efforts to be efficient.
Non-Price Effects: Loss of Dynamic Efficiency

12.31 Mergers that result in a highly concentrated market may reduce the rate of
innovation, technological change and the dissemination of new technologies
with a resulting opportunity loss of economic surplus.71
The Trade-Off
12.32 To satisfy the section 96 trade-off, the efficiency gains must both “be greater
than and offset” the relevant anti-competitive effects.
12.33 The “greater than” aspect of the test requires that the efficiency gains be
more extensive or of a larger magnitude than the anti-competitive effects. The
“offset” aspect requires that efficiency gains compensate for the anti-competi-
tive effects. The additional requirement to “offset” makes it clear that it is not
sufficient for parties to show that efficiency gains merely, marginally or nu-
merically exceed the anti-competitive effects to satisfy the section 96 trade-
off. How significant this additional requirement may be has yet to be tested by
the Tribunal and the courts.
69 “X-inefficiency” typically refers to the difference between the maximum (or theoretical)
productive efficiency achievable by a firm and actual productive efficiency attained.
70 For example, increased market power can lead to rent-seeking behaviour (such as lobby-
ing) which can cause real economic resources to be consumed in activities directed towards
redistributing income, rather than used in producing real output.
71 Losses in dynamic efficiency may be considered under anti-competitive effects or may be
deducted from gains in efficiency at the outset, as indicated in paragraph 12.20.
636
12.34 Both the efficiency gains and the anti-competitive effects can have quantita-
tive (measured) and qualitative aspects to them, and both the “greater than”
and “offset” standards apply to all anti-competitive effects. To enable appro-
priate comparisons to be made, timing differences between measured future
anticipated efficiency gains and measured anti-competitive effects are ad-
dressed by discounting to the present value.
12.35 Merging parties intending to invoke the efficiencies exception are en-
couraged to address how they propose that qualitative and quantitative gains
and effects be evaluated for the purpose of performing the “greater than and
offset” aspect of the trade-off; and to explain how and why the gains “com-
pensate for” the anti-competitive effects.72
PART 13: FAILING FIRMS AND EXITING ASSETS

Business Failure and Exiting Assets
13.1 Among the factors that are relevant to an analysis of a merger and its effects
on competition, section 93(b) lists “whether the business, or a part of the busi-
ness, of a party to the merger or proposed merger has failed or is likely to
fail.” The opening clause of section 93 makes it clear that this information is
to be considered “in determining, for the purpose of section 92, whether or not
Guidelines
a merger or proposed merger prevents or lessens, or is likely to prevent or
lessen, competition substantially.” The impact that a firm’s exit can have in
terms of matters other than competition is generally beyond the scope of the
assessment contemplated by section 93(b).
13.2 Probable business failure does not provide a defence for a merger that is likely
to prevent or lessen competition substantially. Rather, the loss of the actual or
future competitive influence of a failing firm is not attributed to the merger if
imminent failure is probable and, in the absence of a merger, the assets of the
firm are likely to exit the relevant market. Merging parties intending to invoke
the failing firm rationale are encouraged to make their submissions in this re-
gard as early as possible.
13.3 A firm is considered to be failing if:
• it is insolvent or is likely to become insolvent;73
• it has initiated or is likely to initiate voluntary bankruptcy proceedings; or
• it has been, or is likely to be, petitioned into bankruptcy or receivership.
72 The burden is ultimately on the parties to undertake the entire trade-off analysis and es-
tablish that the gains in efficiency are greater than and offset the anti-competitive effects.
73 Technical insolvency occurs when liabilities exceed the realizable value of assets, or
when a firm is unable to pay its liabilities as they come due.
637
13.4 In assessing the extent to which a firm is likely to fail, the Bureau typically
seeks the following information:
• the most recent, audited, financial statements, including notes and qualifi-
cations in the auditor’s report;
• projected cash flows;
• whether any of the firm’s loans have been called, or further loans/line of
credit advances at viable rates have been denied and are unobtainable
elsewhere;
• whether suppliers have curtailed or eliminated trade credit;
• whether there have been persistent operating losses or a serious decline in
net worth or in the firm’s assets;74
• whether such losses have been accompanied by an erosion of the firm’s
relative position in the market;
• the extent to which the firm engages in “off-balance-sheet” financing
(such as leasing);
• whether the value of publicly-traded debt of the firm has significantly
dropped;
• whether the firm is unlikely to be able to successfully reorganize pursuant
to Canadian or foreign bankruptcy legislation, the Companies’ Creditors
Arrangement Act, or through a voluntary arrangement with its creditors.
13.5 These considerations are equally applicable to failure-related claims concern-
ing a division or a wholly-owned subsidiary of a larger enterprise. However,
in assessing submissions relating to the failure of a division or subsidiary, par-
ticular attention is paid to transfer pricing within the larger enterprise, intra-
corporate cost allocations, management fees, royalty fees, and other matters
that may be relevant in this context. The value of such payments or charges is
generally assessed in relation to the value of equivalent arm’s-length
transactions.
13.6 Matters addressed in financial statements are ordinarily considered to be ob-
jectively verified when these statements have been audited or prepared by a
person who is independent of the firm that is alleging failure. The Bureau’s
assessment of financial information includes a review of historic, current and
projected income statements and balance sheets. The reasonableness of the as-
sumptions underlying financial projections is also reviewed in light of historic
results, current business conditions and the performance of other businesses in
the industry.
74 Persistent operating losses may not be indicative of failure, particularly in a “start-up”

situation, in which such losses may be normal and indeed anticipated.
638
Alternatives to the Merger

13.7 Before concluding that a merger involving a failing firm or division is not
likely to result in a substantial lessening or prevention of competition, the Bu-
reau assesses whether any of the following alternatives to the merger exist and
are likely to result in a materially greater level of competition than if the pro-
posed merger proceeds.
Acquisition by a Competitively Preferable Purchaser

13.8 The Bureau assesses whether there exists a third party whose purchase of the
failing firm, division or productive assets is likely to result in a materially
higher level of competition in the market.75 In addition, such a third party
(“competitively preferable purchaser”) must be willing to pay a price which,
net of the costs associated with making the sale,76 would be greater than the
proceeds that would flow from liquidation, less the costs associated with such
liquidation (referred to as the “net price above liquidation value”).77 Where it
is determined that a competitively preferable purchaser exists, it can generally
be expected that, if the proposed merger under review cannot be completed,
the target will either seek to merge with that competitively preferable pur-
chaser, or remain in the market. If the Bureau is not satisfied that a thorough
search for a competitively preferable purchaser has been conducted, the Bu-
reau will require the involvement of an independent third party (such as an
Guidelines
investment dealer, trustee or broker who has no material interest in either of
the merging parties or the proposal in question) to conduct such a search
before the failing firm rationale is accepted.
Retrenchment/Restructuring
13.9 Where it appears that the firm is likely to remain in the market rather than sell
to a competitively preferable purchaser or liquidate, it is necessary to deter-
mine whether this alternative to the proposed merger is likely to result in a
materially greater level of competition than if the proposed merger proceeds.
The retrenchment or restructuring of a failing firm may prevent failure and
enable it to survive as a meaningful competitor by narrowing the scope of its
operations, for instance, by downsizing or withdrawing from the sale of cer-
tain products or from certain geographic areas.
75 The Bureau considers whether the third party is capable of exercising a meaningful influ-
ence in the market. When an alternative buyer does not intend to keep the failing firm’s
assets in the relevant market, the Bureau assesses the extent to which the market power
arising from the original merger proposal is likely to be less than if the alternative merger
proceeds.
76 These costs include matters such as ongoing environmental liabilities, tax liabilities, com-
missions relating to the sale and severance and other labour-related costs.
77 Liquidation value is defined as the sale price of assets as a result of bankruptcy or foreclo-
sure proceedings.
639
Liquidation
13.10 Where the Bureau is able to confirm that there are no competitively prefera-
ble purchasers for the failing firm and that there are no feasible and likely
retrenchment scenarios, it assesses whether liquidation of the firm is likely to
result in a materially higher level of competition in the market than if the
merger in question proceeds. In some cases, liquidation can facilitate entry
into a market by enabling actual or potential competitors to compete for the
failing firm’s customers or assets to a greater degree than if the failing firm
merged with the proposed acquirer.
HOW TO CONTACT THE COMPETITION BUREAU

Consumer Packaging and Labelling Act (except as it relates to food), the Textile
Labelling Act, the Precious Metals Marking Act or the program of written opinions,
or to file a complaint under any of these acts should contact the Competition Bu-
reau’s Information Centre:
Web site
Address
Information Centre
Competition Bureau
50 Victoria Street
Telephone
Toll-free: 1-800-348-5358
TTY (for hearing impaired) 1-800-642-3844
Facsimile
819-997-0324
640
MERGER REVIEW PROCESS GUIDELINES*
January 2015
Preface
choice.
These Guidelines describe the Bureau’s general approach to administering the
Act’s two-stage merger review process applicable to proposed transactions that are
the subject of a pre-merger notification filing. In particular, these Guidelines out-
line the practices and procedures that the Bureau will typically follow: (i) in deter-
Guidelines
mining whether to issue a supplementary information request (“SIR”) under sub-
section 114(2) of the Act; and (ii) where a decision has been made to issue a SIR,
in working with merging parties to narrow issues and/or the requirements for
records, including data, wherever reasonably possible, while first and foremost en-
suring that the Bureau accesses the information it requires to properly review a
proposed transaction.
These Guidelines supersede all previous statements of the Commissioner of Com-
petition (“Commissioner”) or other Bureau officials regarding the Bureau’s ap-
proach to the merger review process. These Guidelines do not replace the advice of
legal counsel and are not intended to restate the law or to constitute a binding state-
ment of how the Commissioner will exercise discretion in a particular situation.
The enforcement decisions of the Commissioner and the ultimate resolution of is-
sues will depend on the particular circumstances of the matter in question. Final
interpretation of the law is the responsibility of the Competition Tribunal (“Tribu-
nal”) and the courts.
The Bureau may revisit certain aspects of these Guidelines in light of experience
and changing circumstances.
* Merger Review Process Guidelines, Innovation, Science and Economic Development

641
Merger Review Process Guidelines
Table of Contents
1. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 643
2. STATUTORY WAITING PERIODS . . . . . . . . . . . . . . . . . . . . . . . . . 644

2.1 Initial 30-day Waiting Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 644
2.2 Second 30-day Waiting Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . 645
2.3 Initial 30-day Waiting Period Permitted to Expire . . . . . . . . . . . . . . 645
2.4 Hostile Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 646
2.5 Early Consultations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 646
3. SUPPLEMENTARY INFORMATION REQUESTS . . . . . . . . . . . . . . 647

3.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 647
3.2 Pre-Issuance Dialogue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 647
3.3 Limited Time Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 648
3.3.1 Default Search Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . 648
3.3.2 Review of Back-up Media . . . . . . . . . . . . . . . . . . . . . . . . . . 649
3.3.3 Requirement to Refresh . . . . . . . . . . . . . . . . . . . . . . . . . . . . 649
3.4 Post-Issuance Dialogue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 650
3.4.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 650
3.4.2 Limiting Number of Custodians . . . . . . . . . . . . . . . . . . . . . . 650
3.4.3 Responding to a SIR — SIR Instructions . . . . . . . . . . . . . . . . 651
3.5 International Cooperation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 652
3.6 Compliance and Completeness . . . . . . . . . . . . . . . . . . . . . . . . . . . . 652
3.6.1 Claims Pursuant to Section 116 . . . . . . . . . . . . . . . . . . . . . . 652
3.6.2 Certifying Completeness . . . . . . . . . . . . . . . . . . . . . . . . . . . . 653
3.7 Internal Appeal Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 653
3.8 Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 654
4. TIMING AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 654

4.1 Providing Information Pursuant to a Timing Agreement . . . . . . . . . 655
4.2 Timing Agreements in the Context of Hostile Transactions . . . . . . . 656
642
APPENDIX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 656
HOW TO CONTACT THE COMPETITION BUREAU . . . . . . . . . . . . . . 661

1. — Introduction
The Bureau recognizes that the majority of mergers do not raise competition con-
cerns and, indeed, may be efficiency-enhancing. Nonetheless, from time to time,
certain transactions raise the possibility of lessening or preventing competition sub-
stantially, thereby having a negative impact on consumers, businesses and the over-
all competitiveness of the Canadian economy. The Bureau reviews these transac-
tions with a view to its mandate to protect and promote competitive markets.
In discharging its merger review obligations under the Act, the Bureau’s priority is
to identify in a timely manner those proposed mergers that pose a potential threat to
competitive markets in Canada, and to allow the balance to proceed as expedi-
tiously as possible. The Act establishes an initial 30-day waiting period during
which the vast majority of notified mergers will be cleared. For those relatively few
transactions that raise a potential substantial lessening or prevention of competition,
the Bureau may issue a “supplementary information request”, or “SIR”, for addi-
tional relevant information. The issuance of a SIR to one or more notifying parties
triggers a second 30-day waiting period, which commences when the Commis-
sioner has received from each SIR recipient a certified complete response to all
Guidelines
information requests set out in the SIR. A proposed transaction may not be com-
pleted until the expiry of the applicable waiting period, subject to termination of the
waiting period where the Bureau notifies the parties that the Commissioner does
not intend, at that time, to make an application under section 92 of the Act in re-
spect of the proposed transaction, or where the waiting period is extended pursuant
to an order under section 100 or 104 of the Act. Further, where parties have entered
into a timing agreement, which includes commitments with respect to closing of the
proposed transaction, the transaction shall not be completed unless and until those
commitments have also been satisfied.
The SIR process allows the Bureau to obtain the records1 required for the Bureau’s
review in a timely and effective manner, and through a more efficient process than
that associated with obtaining orders under section 11 of the Act. The Bureau is
committed to working with merging parties to narrow issues and/or the require-
ments for records, including data, wherever reasonably possible, while first and
foremost ensuring that the Bureau accesses the information it requires to properly
review a proposed transaction. In this regard, these Guidelines set out specific prac-
tices and procedures that, subject to certain exceptions, will be followed in all
cases.
For further information regarding the Bureau’s substantive approach to merger re-
view, including with respect to the analysis of competitive effects, the anti-compet-
1 “Record” is defined in subsection 2(1) of the Act and includes data.
643
itive threshold, and the availability of an efficiencies exception, please refer to the
Bureau’s Merger Enforcement Guidelines.2
2. — Statutory Waiting Periods

Where a proposed transaction surpasses the “party-size” and “transaction-size”
thresholds set out in sections 109 and 110 of the Act, parties are required to notify
the Commissioner prior to completing the proposed transaction.3 Notifiable trans-
actions are subject to an initial 30-day waiting period, and where a SIR is issued,
are further subject to a second 30-day waiting period. Please refer to the Proce-
dures Guide for Notifiable Transactions and Advance Ruling Certificates under the
Competition Act (“Procedures Guide”) for further information regarding the opera-
tion of statutory waiting periods.
2.1 — Initial 30-day waiting period

The submission of a complete notification4 triggers an initial 30-day waiting period
during which parties are legally prohibited from closing their proposed transac-
tion.5 During this initial waiting period, the Bureau will work diligently to narrow
and refine issues and to determine what, if any, additional information is required
from parties to assess these issues. In particular, the Bureau will consider what ad-
ditional information is required to determine whether the proposed transaction is
likely to lessen or prevent competition substantially. Merging parties are en-
couraged to assist the Bureau by responding to voluntary requests for information
on a timely basis, and by substantiating claims regarding applicable factors or ex-
ceptions upon which the parties intend to rely, such as efficiency gains likely to
result from the proposed transaction. As discussed further below, timely compli-
ance with a voluntary information request can minimize the need for, or scope of, a
SIR.
In circumstances where the Bureau has completed its review in advance of the ex-
piry of the initial waiting period, the Commissioner may waive the remainder of the
waiting period by issuing an advance ruling certificate under section 102 of the Act
or notifying the parties that the Commissioner does not intend, at that time, to make
an application under section 92 of the Act in respect of the proposed transaction.
Circumstances in which parties may complete their transaction prior to the expiry
of the full initial waiting period are discussed in detail in the Procedures Guide.
2 (Ottawa: Industry Canada, 2011)

3 Subject to certain exceptions described in Part IX of the Act.
4 Upon receipt of a pre-merger notification filing, the Merger Notification Unit of the Merg-
ers Branch will make a determination as to whether the filing satisfies the statutory require-
ments and, as such, is complete.
5 For further information regarding when a notification is determined to be complete, please
refer to the Bureau’s Fees and Service Standards Handbook for Mergers and Merger-Re-
lated Matters, as well as the Procedures Guide.
644
2.2 — Second 30-day waiting period

Pursuant to paragraph 123(1)(b) of the Act, the issuance of a SIR to one or more
notifying parties triggers a second 30-day waiting period, which commences only
when the Commissioner has received from each SIR6 recipient a complete re-
sponse7 to the SIR8. A proposed transaction may not close until the expiry of this
second waiting period, subject to the parties being notified by the Commissioner
that she does not intend, at that time, to make an application under section 92 of the
Act in respect of the proposed transaction, or subject to an extension of the waiting
period pursuant to an order under section 100 or 104 of the Act.9 As discussed in
part 4 of these Guidelines, where parties provide commitments regarding the com-
pletion of the proposed transaction, whether pursuant to a timing agreement or oth-
erwise, the transaction shall not be completed prior to those commitments having
been satisfied.
2.3 — Initial 30-day waiting period permitted to expire

There may be circumstances where the Bureau’s review is not completed within the
initial 30-day waiting period and the Commissioner elects not to issue a SIR.10 In
such cases, the Bureau will proceed to complete its investigation beyond the expira-
tion of the initial waiting period and, depending on the circumstances, may enter
(before or after expiration of the initial 30-day waiting period) into a “timing agree-
ment”11 with the parties to address key milestones, such as commitments regarding
Guidelines
closing of the proposed transaction and possible further production requirements.
Subject to commitments made to the Bureau regarding timing of the completion of
a proposed transaction or orders obtained pursuant to section 100 or 104 of the Act,
parties are legally entitled to close their transaction upon expiry of the initial 30-
day waiting period where no SIR has been issued. However, in the absence of an
6 Except in the context of a hostile transaction, where the second waiting period commences
once the bidder has submitted a certified complete response, as more particularly described
at section 2.4 of these Guidelines.
7 See section 3.6 of these Guidelines for further information on what is required for a re-
sponse to be complete.
8 This assumes that the Bureau has not challenged the completeness of the response. Where
the Commissioner is of the view that the response provided is incomplete, the Commissioner
may apply to the Tribunal or a court for an order under section 123.1 of the Act.
9 Pursuant to section 100 of the Act, where certain conditions are met, the Tribunal may
issue an interim order forbidding any person from doing any act or thing that appears to the
Tribunal may constitute or be directed toward the completion or implementation of a pro-
posed merger.
10 In such cases, the Merger Notification Unit will send the parties, on the last day of the
initial 30-day waiting period, a letter indicating that the waiting period ends on that date and
that the assessment is incomplete. For further information, please refer to the Procedures
Guide.
11 See Part 4 of these Guidelines for a discussion on timing agreements.
645
ARC or no-action letter, the parties have no assurances that the Commissioner has
no present intention to challenge the proposed transaction.
2.4 — Hostile transactions

Where a transaction falls within the ambit of subsection 114(3) of the Act (a “hos-
tile transaction”), the statutory waiting periods are determined without reference to
the day on which a notification or a complete response to a SIR is received from
the target. Thus, the initial 30-day waiting period begins when the Commissioner
has received a complete notification from the bidder and the second 30-day waiting
period begins when the Commissioner has received a complete response to a SIR
from the bidder.
At the time a bidder submits its certificate of compliance with the SIR, the Bureau
will consider whether subsections 114(3) and 123(3) are applicable to the proposed
transaction.12 Where these subsections are applicable, the second 30-day waiting
period begins after the Commissioner has received a complete SIR response from
the bidder. Accordingly, in the context of a hostile transaction, a target is not able
to affect the commencement of the relevant waiting periods.
As discussed in section 4.2 of these Guidelines, to ensure receipt of SIR responses
from a target on a timely basis, the Bureau will typically issue a SIR in combina-
tion with a timing agreement13 and/or orders pursuant to section 11 of the Act.
2.5 — Early consultations

While parties remain free to determine whether and when to engage in discussions
with the Bureau regarding a proposed transaction, parties are encouraged to consult
with the Bureau prior to, or as soon as possible after, submission of a pre-merger
notification filing. The goal of early consultations is to provide the Bureau with the
appropriate context and information on a voluntary basis, and to identify issues
requiring further examination.
Ultimately, such consultations can facilitate a more efficient and effective review
process for the merging parties as well as the Bureau; however, realization of these
benefits is largely dependent upon the parties’ willingness to engage in full and
frank communications with the Bureau, and to proactively assist the Bureau in ob-
taining information required for the Bureau’s analysis. Where parties engage in
substantive discussions with the Bureau and provide information pertinent to the
Bureau’s review prior to or as earlier as possible during the initial waiting period,
the Bureau is more likely to be able to reduce the scope of, or necessity for, a SIR.
12 For further information regarding the Bureau’s policy with respect to the commencement
of the paragraph 123(1)(b) waiting period, please refer to Hostile Transaction Policy No.
2 — Running of Subsection 123(1) Waiting Periods.
13 See Part 4 of these Guidelines for further information on timing agreements.
646
3. — Supplementary Information Requests

3.1 — Overview
Where a notifiable transaction raises concerns regarding a potential substantial les-
sening or prevention of competition, the Bureau will determine what additional in-
formation is required from merging parties and/or third parties to conduct a suffi-
ciently thorough assessment of the potential competitive impact of the transaction.
If the Bureau requires additional information, such information will generally be
sought from the merging parties by way of a SIR14, and from third parties by way
of voluntary information requests or orders under section 11 of the Act.15
Where the Bureau determines that a SIR is necessary, it will notify the parties
within the initial 30-day waiting period that a SIR is forthcoming and at this time, if
possible, will communicate to the parties the Bureau’s preliminary views on poten-
tial competition issues identified to that point in time (understanding that further
issues may be identified at a later stage as the review progresses). In certain cir-
cumstances, for example, where the Bureau is of the view that focusing its efforts
on certain substantive aspects of a merger review may enable it to eliminate the
need for a SIR, the Bureau may defer a determination regarding the issuance of a
SIR to later in the initial 30-day period.
As described above, the issuance of a SIR to one or more notifying parties triggers
a second 30-day waiting period, which only commences when the Commissioner
Guidelines
has received from each recipient a certified complete response to all information
requests set out in the SIR.16
3.2 — Pre-issuance dialogue

Prior to issuing a SIR, the Bureau will generally provide a draft to the recipient
party and, at that party’s election, engage in dialogue with the party, its counsel and
its business representatives and technical staff, regarding the information requests
set out therein. The pre-issuance dialogue process is not intended to serve as a fo-
rum for debate or negotiation with the Bureau on the merits of the case or the
14 Where parties to a notifiable transaction certify complete responses to their respective

SIRs, and the Commissioner does not challenge the completeness of the responses, the Bu-
reau anticipates that use of orders pursuant to section 11 of the Act to obtain additional
information from merging parties in a consensual transaction will be rare. For transactions
not subject to the notification provisions of Part IX of the Act, the Bureau may use orders
pursuant to section 11 of the Act to gather required information from merging parties.
15 For further information on the application of section 11 of the Act, please refer to the
Bureau’s Information Bulletin on Section 11 of the Competition Act (November 2005).
16 Where the Commissioner is of the view that the responses provided are incomplete, the
Commissioner may apply to the Tribunal or a court for an order under section 123.1 of the
Act, and may seek an injunction pending a decision of that motion.
647
relevance of particular information requests found in the draft SIR. The purpose of
this pre-issuance dialogue is to:
(i) ensure that the party understands the information requests;
(ii) discuss whether the party maintains data in the form requested by the Bu-
reau and with whom or how such records are held;
(iii) determine whether there are sources or forms of information that may be
more directly responsive to the Bureau’s request, provided such alternatives
satisfy the Bureau’s need for records sufficient to satisfy its statutory mandate;
and
(iv) ascertain whether there are any other factors that might impair the ability
of the party to comply with the SIR.
Pre-issuance dialogue with the party may also assist in reducing the scope of a SIR
by, for example, limiting certain specifications to particular categories of employ-
ees with responsive information where appropriate, or identifying technological
barriers to production.17 In this regard, the party is uniquely positioned to assist the
Bureau in identifying concerns that can be addressed prior to the issuance of the
SIR.
In most cases, the Bureau anticipates that the recipient will review the draft SIR
and will be prepared to provide comments relating to the matters identified above
during the pre-issuance dialogue or immediately thereafter. In certain circum-
stances, a proposed SIR may require more extensive discussions. While the Bureau
will give due consideration to all comments received from the party, it is ultimately
within the Bureau’s discretion to amend the draft SIR as it considers appropriate.
Subject to any constraints that arise in the context of a particular case, the period of
time between the party’s receipt of the draft SIR and completion of the pre-issuance
dialogue process would generally be no longer than two business days.
3.3 — Limiting time periods

3.3.1 — Default search periods
The default search period for hard copy and electronic records (excluding data) in
the possession, custody or control of a party will generally be the year-to-date pe-
riod immediately preceding the date of issuance of the SIR and the previous two
full calendar years. The Bureau will also generally limit the relevant time period for
data requests to the year-to-date period immediately preceding the date of issuance
of the SIR and the previous three full calendar years. These search periods are sub-
ject to the refresh requirement, which in certain circumstances, as discussed further
17 Where the Bureau agrees that it is appropriate to dispense with or defer production obliga-
tions, this neither limits the Bureau’s right to seek production of information through a dis-
covery process, nor alters the parties’ record preservation obligations. The Bureau has a right
to discovery in all merger cases in which a challenge is filed with the Tribunal.
648
in section 3.3.3 of these Guidelines, require a party to produce records up to 30

days prior to the date it certifies completeness.
These default search periods may be adjusted, as circumstances demand, to accom-
modate the particular facts of a case. For example, circumstances may dictate a
need for additional records and/or longer data sets to facilitate meaningful analysis,
such as where the Bureau must assess industry dynamics both prior to and follow-
ing the entry of a new market participant. Any departure from the default time
periods outlined above requires approval from the Senior Deputy Commissioner of
the Mergers Branch.
3.3.2 — Review of back-up media

In general, a party will not be required to produce records contained on back-up
tapes where sufficient records can be obtained otherwise. Given the time and cost
that may be associated with the review of back-up media, the Bureau will engage in
discussions with a party on a case-by-case basis in an attempt to understand the
value and volume of resources that would be associated with production, having
regard to the nature of the investigation and the information at issue.
Parties are advised to provide the Bureau with details of their archival systems and
data access/recovery procedures during pre-issuance dialogue. In particular, to fa-
cilitate a constructive dialogue, a party should provide the Bureau with access to a
Guidelines
member of its technical staff with suitable knowledge of the manner in which that
party collects, maintains and uses the types of information that the Bureau may
seek pursuant to the SIR, as well as the information technology systems that store
the information in question. Following review of this information and discussions
with appropriate members of the party’s staff, the Bureau can work cooperatively
with the party to determine how best to meet the Bureau’s information needs in
light of that party’s particular circumstances and, indeed, whether a review of back-
up tapes is required at all.
3.3.3 — Requirement to refresh

Once a SIR has been issued, merging parties have significant control over the tim-
ing of the merger review process owing to the fact that the second waiting period
commences when the Commissioner has received from each recipient a certified
complete response to all information requests set out in the SIR, assuming the Bu-
reau does not challenge the completeness of those responses.18 As the Bureau re-
quires current information to conduct its review of a proposed transaction, the Bu-
reau will require that a party produce “refreshed” information where the period
between the date of issuance of the SIR and the date of certification of a complete
response exceeds, typically, 90 days. Where this is the case, and also for certain
limited categories of documents responsive to a SIR, (e.g., transaction documents
18 In the case of a hostile transaction, see section 2.4 of these Guidelines for further informa-
tion regarding the commencement of the second waiting period.
649
and efficiencies-related records), the Bureau requires responsive records to be cur-

rent to within 30 days of a party’s certification of a complete response.
Where a party that has engaged in rolling production is required to produce re-
freshed records, and the Bureau has indicated in writing that it has received suffi-
cient information with respect to a particular SIR specification, refreshed records in
respect of that specification will not be required.
3.4 — Post-issuance dialogue

3.4.1 — Overview
Once a SIR is issued, the Bureau encourages the recipient party to engage in post-
issuance dialogue for the purpose of, among other things:
(i) prioritizing information to be supplied by a party;
(ii) discussing custodians and search terms to be used in conducting electronic
searches; and
(iii) where information has been produced on a rolling basis, confirming
whether further information is required by the Bureau in response to a particu-
lar specification of the SIR.
The Bureau anticipates that parties will use best efforts to respond to a SIR in a
timely manner and on a rolling basis, and will provide access to business and tech-
nical staff to allow the Bureau to better understand the nature and structure of the
parties’ respective businesses at the earliest possible stage of the Bureau’s review.
Further, providing the Bureau with, for example, competitive impact submissions,
will assist the Bureau in narrowing issues.
3.4.2 — Limiting number of custodians

The Bureau acknowledges that the number of custodians is an important determi-
nant of the total cost involved in responding to a SIR. A party is uniquely posi-
tioned to determine which individuals within its organization will have documents
responsive to the SIR. As such, the Bureau cannot endorse a proposed list of custo-
dians; however, the Bureau encourages discussions with parties regarding the cus-
todians that the party proposes to search. In order to have an effective discussion, a
party seeking to limit custodians should make the following available to the
Bureau:
(i) a detailed chart and personnel directory identifying all past and present em-
ployees having management or decision-making responsibility with regard to
potentially relevant products during the relevant time period, and their posi-
tions within the party’s organization; and
(ii) a member of the party’s staff with suitable knowledge to discuss with the
Bureau particulars of each employee’s roles and responsibilities in the party’s
organization and their respective relationships to the issues forming the basis
of the Bureau’s investigation.
Following SIR issuance and receipt of the information referred to above, Bureau
officers will engage in discussions with appropriate members of the party’s staff, to
650
understand the roles and responsibilities of the custodians that the party has identi-
fied as part of the search group. The Bureau expects that the number of custodians
to be searched for responsive records would normally not exceed 30. In the event
that records subsequently provided by the party appear to be substantially incom-
plete, it may then be necessary to revisit the issue of custodians, including poten-
tially identifying additional custodians to be searched. Although the Bureau will
engage in custodian discussions, parties are required to certify on oath or solemn
affirmation that information provided in response to a SIR is complete and correct
in all material respects in accordance with section 118 of the Act and, as such,
parties must satisfy themselves that the custodians identified as part of the search
group will be adequate to enable them to provide the requisite certificate. Custodian
discussions provide parties with the opportunity to explain to the Bureau its process
and rationale for including and excluding individuals from the search group, and
also provide the Bureau with an early opportunity to identify any concerns it may
have, which may reduce the likelihood of the Bureau subsequently raising concerns
about the completeness of the responses provided by a party.
The identification of a search group does not exempt production of the following:
(i) specific types of records contained in central files (including, for example,
budgets, contracts and financial reports). SIRs will normally require that such
files be searched in addition to those of the identified custodians;
(ii) predecessors, successors, secretaries and assistants of the identified custo-
Guidelines
dians within the relevant period. The files of these individuals must also be
reviewed along with those of the identified custodian for the purposes of the
SIR; and
(iii) employees operating at the local level where multiple local markets are
relevant to the merger review.
In appropriate cases, such as where the parties operate on a North American basis
and, in the Bureau’s view, there are no competition issues that are unique to Can-
ada, the Bureau may consult with the party to examine the prospect of limiting
custodians (to the extent possible) to those custodians to which U.S. authorities
have agreed for purposes of a second request under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976.19
3.4.3 — Responding to a SIR — SIR instructions

To expedite the Bureau’s review of information submitted in response to a SIR, the
Bureau has defined certain streamlined procedural measures in the instructions to a
SIR that govern the submission of information, a copy of which is attached hereto
at the Appendix. For example, in responding to a SIR, a party is requested to pro-
vide an index that includes an entry for each paragraph and subparagraph of the
SIR, and a corresponding reference to the records that are responsive to that para-
19 In respect of any transaction, the Bureau may identify both Canadian and foreign
custodians.
651
graph or subparagraph. Records that are responsive to a particular paragraph or

subparagraph may be referenced as a group. For example, a statement that the
records in “Binder 1”, “Tab 1”, “Box 1” or “CD 1” are responsive to a particular
paragraph will be acceptable to the Bureau.
3.5 — International cooperation

Where a multi-jurisdictional merger gives rise to review by multiple competition
agencies, the parties may wish to provide the Bureau with copies of records pro-
duced to a foreign agency that are also responsive to the SIR. The Bureau will
generally agree to such an arrangement, provided that, among other things:
(i) the parties have provided appropriate confidentiality waivers to the foreign
antitrust agency to permit sharing of information with the Bureau; and
(ii) the records received in this manner will be treated for all purposes as
though provided directly to the Bureau.
If a party arranges for the Bureau to have access to records submitted by the party
to a foreign agency rather than providing copies directly to the Bureau, and where
the Bureau determines that such an approach is acceptable, the conditions listed
above must also be met. In addition, the party must provide the Bureau with an
index that includes an entry for each paragraph and subparagraph of the SIR, and
corresponding unique identifiers that will allow the Bureau to locate in the produc-
tion to the foreign agency each record that the party claims to be responsive to the
applicable paragraph or subparagraph of the SIR.
3.6 — Compliance and completeness

3.6.1 — Claims pursuant to section 116
Pursuant to section 116 of the Act, certain information need not be supplied by a
party in response to a SIR, including information that:
(i) is not known or reasonably obtainable;
(ii) cannot be supplied because of the privilege that exists between lawyers or
notaries and their clients;
(iii) cannot be supplied because of a confidentiality requirement established by
law;
(iv) cannot reasonably be considered relevant to the Commissioner’s assess-
ment of the proposed transaction; or
(v) has been previously supplied to the Bureau by that party,
provided that the party informs the Commissioner on oath or solemn affirmation of
the reason why the information cannot be or has not been supplied, as applicable,
and where information has previously been supplied, the date on which such infor-
mation was supplied. Where a party does not intend to supply certain information
based on a claim under section 116, the Bureau encourages consultations with the
officers reviewing the transaction at the earliest possible stage. Where the Bureau
652
disagrees with a party’s claim, the Bureau may require the party to supply certain
information pursuant to subsection 116(3) of the Act.
3.6.2 — Certifying completeness

In accordance with section 118 of the Act, the information supplied in response to a
SIR must be certified on oath or solemn affirmation by:
(i) an officer of the company supplying the information or other person duly
authorized by the board of directors or other governing body of the company;
or
(ii) in the case of any other person supplying the information, by that person;
as having been examined by that person and as being, to the best of his/her knowl-
edge and belief, correct and complete in all material respects.
Where the information is supplied by an entity other than a corporation, the oath or
solemn affirmation must be given by a person who exercises functions similar to
those of a corporate officer, or another person duly authorized by the governing
body of the entity. The Bureau does not issue a certification that a party’s response
to a SIR is complete.
The Bureau cannot properly assess whether information in response to a particular
specification remains outstanding until it has received each party’s response to the
specification and any related specifications, and has had an opportunity to review
Guidelines
those responses. Where a party has certified that it has complied with a SIR but the
Bureau disagrees, the Bureau will, as soon as reasonably possible, indicate in writ-
ing the deficiencies in that party’s production. Where parties have engaged in roll-
ing production, the Bureau is typically better situated to identify and raise any defi-
ciencies with parties on a rolling basis, and thereby reduce the risk that the Bureau
will identify deficiencies post-certification.
As discussed in section 3.8 of these Guidelines, where the Commissioner is of the
view that the responses provided are incomplete, the Commissioner may apply to
the Tribunal or a court for an order under section 123.1 of the Act.
3.7 — Internal appeal procedure

Any party seeking to contest the scope of a SIR, or the Bureau’s determination that
the party’s response to a SIR is incomplete, is encouraged to engage in discussions
with the responsible Assistant Deputy Commissioner at the earliest opportunity.
Where, after reasonable efforts, the party has failed to reach agreement with the
responsible Assistant Deputy Commissioner, the party may submit a written notice
of appeal to the Senior Deputy Commissioner of the Mergers Branch, outlining the
nature of the complaint in reasonable detail.
The Senior Deputy Commissioner of the Mergers Branch will immediately forward
the notice to a Deputy Commissioner in another branch of the Bureau (the “Re-
viewer”). The Reviewer will speak with the responsible Assistant Deputy Commis-
sioner, request additional information pertaining to the complaint from the party
within five business days of receipt of the written appeal, and provide the party
with a reasonable opportunity to make submissions. The Reviewer will render a
653
decision within seven business days after the party has provided all requested
information.
In the case of an appeal regarding the scope of a SIR, the Reviewer will either
advise the party in writing that the scope of the SIR is appropriate in the circum-
stances, or modify the requirements of the SIR to reflect the Reviewer’s conclu-
sions. Parties are advised that an appeal as to the scope of a SIR must be made prior
to any assertion that the party has complied with the SIR, and the party must agree
to defer any assertion of compliance until the completion of the appeal process or
until such time as the party has withdrawn its appeal.
In the case of an appeal regarding completeness of a party’s response to a SIR, if
the Reviewer determines that the party has submitted the information requested
under the SIR, then the waiting period will begin on the last date that all relevant
parties to the transaction certified compliance. If the Reviewer determines that a
party has not submitted the information required pursuant to the SIR, the Bureau
will advise the party in writing that the response to the information request is defi-
cient and identify outstanding required information. As discussed below, if the Bu-
reau is of the view that a party has not complied with a SIR, the Commissioner may
apply to the Tribunal or a court for a determination on the question of compliance.
3.8 — Enforcement
As described above, a notifiable transaction in respect of which a SIR has been
issued is permitted to close at the expiry of a second 30-day waiting period, subject
to earlier termination of the waiting period or extension of the waiting period pur-
suant to an order under section 100 or 104 of the Act, or commitments made to, and
accepted by, the Bureau regarding timing of completion of a proposed transaction.
If parties proceed to complete the proposed transaction before the waiting period
has expired, such parties may be subject to court ordered remedies under section
123.1 of the Act. In particular, on application by the Commissioner, a court may
make an order requiring any party to the transaction to dissolve the merger or to
pay an administrative monetary penalty to a maximum amount of $10,000 for each
day on which the parties have failed to comply with section 123 of the Act. Admin-
istrative monetary penalties apply only where parties have proceeded to close prior
to the expiry of the waiting period.
Where the parties provide notice of an intention to complete the proposed transac-
tion without complying with a SIR, or where the Commissioner otherwise believes
that the parties are likely to complete the proposed transaction without complying,
the Commissioner may apply to the Tribunal or a court for an injunction prohibit-
ing the parties from doing anything that may constitute or be directed toward the
completion or implementation of the proposed transaction.
4. — Timing Agreements
Depending on the particular circumstances, timing agreements may include a vari-
ety of commitments, including providing the Bureau with information necessary to
conduct its review and/or advance written notice of closing of the proposed transac-
654
tion. Unilateral commitments by parties to provide the Bureau with, for example,
information or advance notice of closing are not, on their own, a timing agreement.
4.1 — Providing information pursuant to a timing agreement

There are limited circumstances where the Bureau may consider an appropriately
worded timing agreement as an acceptable means of obtaining additional informa-
tion. For example, where a transaction is not subject to the pre-merger notification
requirements under Part IX of the Act or where information is required from third
parties, the Bureau may proceed by way of timing agreement or orders under sec-
tion 11 of the Act.
For notifiable transactions, the Bureau will typically seek additional information
from merging parties by way of a SIR; however, in limited circumstances, it may
proceed by way of a timing agreement.20 Factors that the Bureau may consider in
making this determination include, among other things, the type of transaction
(e.g., hostile or friendly transaction21), whether a statutory waiting period is run-
ning, and the information required by the Bureau to conduct its review and to what
extent such information has been received from the parties.
Where the Bureau determines that a timing agreement is acceptable, such agree-
ment will, among other things, provide:
(i) a detailed description of the information to be provided by the party;
Guidelines
(ii) commitments on rolling production, including specific dates by which the
requested information will be supplied;
(iii) that the information supplied in response to the information request will
be certified on oath or solemn affirmation to be correct and complete in all
material respects in the form required by section 118 of the Act;22 and
(iv) the period of time during which a party will use its best efforts to resolve
any deficiencies Bureau officers may have identified in such party’s response
to the information request; and
(v) timing of closing (except where the timing agreement is with a third party).
As the Bureau cannot stipulate a date by which it will have completed its review
prior to receiving and reviewing the requested information, such timing commit-
ments will not be included in timing agreements; however, the Bureau will, as al-
ways, provide parties with timely and appropriate updates regarding the status of its
review.
20 Where the Bureau decides not to issue a SIR or to seek orders under section 11 of the Act,
this neither limits the Bureau’s right to seek production of information through a discovery
process, nor alters the parties’ record preservation obligations. The Bureau has a right to
discovery in all merger cases in which a challenge is filed with the Tribunal.
21 See section 4.2 of these Guidelines.
22 See section 3.6.2 of these Guidelines.
655
4.2 — Timing agreements in context of hostile transactions

As discussed in section 2.4 of these Guidelines, the second statutory waiting period
in the context of a hostile transaction is determined by the bidder without reference
to when a complete response to a SIR is received from the target. As a result, where
the Bureau issues a SIR to the bidder and also requires additional information from
the target, the Bureau must be assured that information required from the target will
be received on a timely basis. In these circumstances, regardless of whether the
transaction remains hostile, the Bureau will typically issue a SIR to the target in
combination with either a timing agreement or an order under section 11 of the Act.
Where the transaction is no longer hostile at the time the bidder certifies complete-
ness with its SIR, the second waiting period will not commence unless and until the
target certifies completeness with its SIR, and it will only commence then, assum-
ing the Bureau has not challenged the completeness of either parties’ responses.23
The Bureau may also request that a bidder provide timing commitments. For exam-
ple, it may request that the bidder not certify completeness of its SIR responses
prior to a specific date and that the bidder provide the Commissioner with advance
notice of closing. Such commitments allow the Bureau sufficient time to obtain and
analyze the information required to conduct its review and to focus on the substan-
tive review of the potential competitive effects of the transaction.
Appendix
Sample Supplementary Information Request Instructions
These instructions are being provided as a sample only and are subject to change.
In order to facilitate the handling and orderly maintenance of Records, including
data, provided in response to this Supplementary Information Request (“SIR”), the
following procedures shall be observed:
1. — General
(a) Subject to subparagraphs 1(b) and 1(c), unless otherwise specified, this SIR
requires the production of all responsive Records, including data, in the possession,
custody, or control of the Company on the date that this SIR was issued.
(b) Notwithstanding subparagraph 1(a) above, and subject to subparagraph 1(c) be-
low, the Company may be required to produce information and Records in response
to certain paragraphs or subparagraphs of this SIR up to thirty (30) calendar days
prior to the date of the Company’s full compliance with this SIR, except responsive
Records that must be translated into English or French, for which the date is forty-
five (45) calendar days prior to the date of the Company’s full compliance with this
SIR (“Continuing Production Requirement”).
23 For further information regarding the Bureau’s policy with respect to the commencement
of the paragraph 123(1)(b) waiting period, please refer to Hostile Transaction Policy No.
2 — Running of Subsection 123(1) Waiting Periods.
656
(c) Unless otherwise specified,

(i) if the Company’s full compliance with this SIR occurs within ninety (90)
calendar days of the date of issuance of the SIR, then only paragraphs [•] of
Part [•] of this SIR are subject to the Continuing Production Requirement; and
(ii) if the Company’s compliance with this SIR is completed more than ninety
(90) calendar days after the date of the issuance of the SIR, then the entire SIR
is subject to the Continuing Production Requirement.
(d) Unless otherwise specified, each paragraph and subparagraph of Part [•] of this
SIR that requests Records, other than data, requires the Company to submit all re-
sponsive Records that were created or received by the Company during the two (2)
calendar years immediately preceding the year of issuance of this SIR. The Com-
pany shall also submit Records for the period from January 1 of the current year to
the later of either: (i) the date of issuance of this SIR, or (ii) such time as specified
by a Continuing Production Requirement.
(e) Unless otherwise specified, each paragraph and subparagraph of Part [•] of this
SIR that requests data requires the Company to submit such data for the period of
three (3) calendar years immediately preceding the year of issuance of this SIR.
The Company shall also submit data for the period from January 1 of the current
year to the later of either: (i) the date of issuance of this SIR, or (ii) such time as
specified by a Continuing Production Requirement.
Guidelines
(f) All responsive Records are to be produced in their entirety. If any portion of any
Record is responsive to any paragraph or subparagraph of Part [•] of this SIR, then
the entire responsive Record, as well as any other stapled or otherwise attached
Records, shall be produced with privileged material redacted and recorded in a
manner set forth in subparagraphs 2(g) and 3(b) of Part [•] of this SIR.
(g) The Company shall provide an index that shall include an entry for each para-
graph and subparagraph of Part [•] of this SIR, and a corresponding reference to all
Records that are responsive to such paragraph or subparagraph. Records that are
responsive to a particular paragraph or subparagraph may be referenced as a group.
For example, a statement that the Records in “Binder 1”, “Tab 1”, “Box 1”, or “CD
I” are responsive to paragraph 1 of Part [•] is acceptable. In the alternative, the
Company shall provide a list of search terms used to identify potentially responsive
documents and information or to eliminate potentially non-responsive documents
and information provided in response to each paragraph and subparagraph of Part
[•] of this SIR.
(h) Where a Record is responsive to more than one paragraph or subparagraph of
Part [•] of this SIR, the Company may produce it only once, but must indicate in
the index required in subparagraph (g) all paragraphs or subparagraphs to which the
Record is responsive.
(i) The Records produced are to be either original Records or certified by affidavit
of a duly authorized representative of the Company to be true copies.
(j) Those Records written in a language other than English or French must be trans-
lated into either English or French. The foreign language document must be sub-
mitted with the English or French translation attached thereto.
657
2. — Electronic Records
(a) All electronically stored information (“ESI”) (i.e., information readable in a
computer system) should be produced free of computer viruses or malware, be ac-
cessible, readable and printable, and be devoid of passwords or encryption.
(b) All ESI should be produced in its original electronic format (i.e., native format)
except where near-native format is required by clause 2(c)(ii) and subparagraph
2(f) of Part [•] of this SIR. Detailed instructions are set out in Schedule A of Part [•]
for production using computer systems without application export capabilities and
in Schedule B of Part [•] for production using litigation application exports. The
Bureau’s preference is to receive ESI in accordance with Schedule B of Part [•].
(c) Where a Record being produced is part of a family, all parent and child Records
should be produced and the parent/child relationship should be preserved. A family
is a collection of pages or files produced manually or by a software application,
constituting a logical single communication of information, but consisting of more
than one single stand-alone Record. Examples include:
(i) a fax cover, the faxed letter, and an attachment to the letter, where the fax
cover is the parent and the letter and attachment are each a child;
(ii) email repositories (e.g., Outlook .PST, Lotus .NSF) can contain a variety
of Records, including messages, calendars, contacts, and tasks. For purposes
of production, all parent Records, both native (e.g., documents, spreadsheets,
presentations) and near-native (e.g., email, calendar, contacts, tasks, notes),
and child Records (e.g., object linking and embedding items and attachments
of files to emails or to other parent records) should be produced with the par-
ent/ child relationship preserved. Similar items found and collected outside an
email repository (e.g., .MSG, .EML, .HTM, .MHT) should be produced in the
same manner; and
(iii) archive file types (e.g., .zip, .rar) should be uncompressed for processing.
Each file contained within an archive file should be produced as a child to the
parent archive file. If the archive file is itself an attachment, that parent/child
relationship should also be preserved
(d) Hard copy or paper Records produced as ESI should be produced as single page
TIFF images with a resolution of 300 dpi (dots per inch) and OCR generated text.
The Records should be produced as they are kept, reflecting attachment relation-
ships between Records and information about the file folders within which the Re-
cord is found. Where colour is required to interpret the Record, such as hard copy
photos, and certain charts, that image should be produced in colour. These colour
images are to be produced as .jpg format. Hard copy photographs should be pro-
duced as colour .jpg, if originally in colour, or greyscale .tif files if originally in
black and white.
The following bibliographic information, if it is available, should also be provided
for each Record:
(i) document ID
(ii) date;
658
(iii) author / author organization

(iv) recipient / recipient organization
(e) Each database Record submitted in response to a paragraph or subparagraph of
Part [•] of the SIR:
(i) should be produced whole, in a flat file, in a non-relational format and
exported as a delimited text file where fields are separated by the pipe charac-
ter (—) and a caret (is used as the text qualifier (e.g. etc.); and
(ii) should include a list of field names; a definition for each field as it is used
by the Company, including the meanings of all codes that can appear as field
values; the format, including variable type and length, of each field; and the
primary key in a given table that defines a unique observation.
(f) The Company may use de-duplication or email threading software if the Com-
pany provides the Bureau with a written description of the proposed process to be
used, including what is considered a duplicate, and the Bureau confirms that the
deployment of such processes permits the Company to comply fully with this SIR.
(g) Documents requiring redaction pursuant to any claim of privilege should be
produced as single-page TIFF or multi-page PDF images and designated “Re-
dacted” in the field as described in Schedule B of Part [•] of this SIR. Appropriately
redacted searchable text (OCR of the redacted images is acceptable), metadata, and
bibliographic information must also be provided. All documents that are part of a
Guidelines
document family that includes a document withheld pursuant to any claim of privi-
lege will be designated “Family Member of Privileged Doc” in the field as de-
scribed in Schedule B. Placeholder images with BEGDOC#, FILENAME,
FILEPATH and reason withheld (e.g., “Privileged”) should be provided in place of
the document images of the privileged document.
(h) All ESI should be provided on portable storage media appropriate to the volume
of data (e.g., USB/flash drive, CD, DVD, hard drive) and should be identified with
a label setting out the matter name, the contents and the date of production. Each
medium should contain no more than 250,000 files (e.g., native ESI or images or a
combination of both).
(i) In the event that ESI is delivered in a format that is not one of the formats set out
in Schedule A or Schedule B of Part [•] of this SIR, the ESI should be provided
along with all available instructions and other materials, including software, as nec-
essary for the retrieval and use of the ESI (subject to any software licensing restric-
tions, which the Company and the Bureau should discuss in advance of
production).
659
3. — Completeness
(a) In accordance with section 118 of the Competition Act, the information supplied
to the Commissioner pursuant to this SIR shall be certified on oath or solemn affir-
mation by:
(i) an officer of the Company supplying the information or other person duly
authorized by the board of directors or other governing body of the Company;
or
(ii) in the case of any other person supplying the information, by that person;
as having been examined by that person and as being, to the best of his/her knowl-
edge and belief, correct and complete in all material respects.
(b) For each Record or portion thereof or any other information withheld under a
claim pursuant to section 116 of the Competition Act, including:
(i) information that is not known or reasonably obtainable;
(ii) information that cannot be supplied because of the privilege that exists
between lawyers and notaries and their clients, or information that cannot be
supplied because of a confidentiality requirement established by law;
(iii) information that could not, on any reasonable basis, be considered to be
relevant to an assessment by the Commissioner as to whether the Proposed
Transaction would or would be likely to prevent or lessen competition sub-
stantially; or
(iv) information that has been previously supplied to the Commissioner;
the Company shall inform the Commissioner under oath or solemn affirmation of
the reason why the information cannot or has not been supplied, as applicable, and
where information has been previously supplied, the date such information was
supplied.
Schedule A
Computer Systems With No Application Export Capabilities
1. ESI generated by office productivity suite software should be produced in its
native format.
2. Emails should be produced in their near-native format. Where an email has at-
tachments, the attachments should be left embedded in the native file and not ex-
tracted separately.
Schedule B
Litigation Application Exports
1. A load file (e.g., Opticon (OPT), IPRO (LFP), Summation (DII) or Ringtail
(MDB)) and all related ESI should be produced in native format, except where
near-native format is required by clause 2(c)(ii) and subparagraph 2(f) of Part [•] of
this SIR.
660
2. Within the delimited metadata file where fields are separated by the pipe charac-
ter (—) and a caret (is used as the text qualifier (e.g. etc.), and depending on the
nature of the ESI, the following fields should be provided:
DOCID
BEGDOC
ENDDOC
BEGATTACH
ENDATTACH
FILEPATH
PARENTBATES (bates number of parent record)
CHILDBATES (bates number(s) of any child records)
MD5HASH (MD5HASH of the native format ESI)
TEXTPATH (link to extracted text on the production media for tiffs only)
NATIVEPATH (link to any files produced in native format on the production
media)
CUSTODIAN
ALLCUSTODIAN
TO
FROM
AUTHOR
CC
Guidelines
BCC
SUBJECT/TITLE
FILENAME
DOCDATE
DATESENT
TIMESENT
DATECREATED
TIMECREATED
DATELASTMOD
TIMELASTMOD
DATEACCESSED
TIMEACCESSED
SPECIFICATION
FILEEXTENSION
REDACTED
FAMILYMEMBERPRIVILEGEDDOC
The ESI produced should be indexed by using the “SPECIFICATION” field as
being responsive to the paragraphs or subparagraphs of Part [•] of this SIR. If mul-
tiple values exist for the specification, they should be separated by a semi-colon
(e.g. 1a; 1b; 2a, etc.).
How to Contact the Competition Bureau

661
Web Site
www.bureaudelaconcurrence.gc.ca
Address
Information Centre
Competition Bureau
50 Victoria Street
Gatineau, Québec K1A 0C9
Telephone
Toll-free: 1-800-348-5358
Facsimile
819-997-0324
662
COMPETITOR COLLABORATION GUIDELINES*
December 2009
Preface
The Competition Bureau (the “Bureau”) is an independent law enforcement agency
responsible for, among other things, the administration and enforcement of the
Competition Act (the “Act”). The Bureau contributes to the prosperity of Canadi-
ans by protecting and promoting competitive markets and enabling informed con-
sumer choice. These Guidelines describe the Bureau’s approach to assessing col-
laborations between competitors.
Canadian firms face increasing pressure to adopt flexible business strategies to re-
main competitive in an economy that is continually changing due to globalization,
technological innovation and advancements in production processes. Strategic alli-
ances can permit Canadian firms to capture the benefits of rapid technological
changes and dynamic competitive conditions. They can permit firms to combine
Guidelines
capabilities and resources so as to lower the costs of production, enhance product
quality, and reduce the time required to bring new products to market. Such pro-
competitive collaborations, even when they involve competitors, can often benefit
Canadians by allowing firms to make more efficient use of resources and accelerate
the pace of innovation. At the same time, certain competitor collaborations may
result in significant harm to competition.
The 2009 amendments to the Act create a more effective criminal enforcement re-
gime for the most egregious forms of cartel agreements, while at the same time
removing the threat of criminal sanctions for legitimate collaborations to avoid dis-
couraging firms from engaging in potentially beneficial alliances. As explained in
greater detail in these Guidelines, the amended criminal prohibition is reserved for
agreements between competitors to fix prices, allocate markets or restrict output1
that constitute “naked restraints” on competition (restraints that are not imple-
mented in furtherance of a legitimate collaboration, strategic alliance or joint ven-
* Competitor Collaboration Guidelines, Innovation, Science and Economic Development

1 These agreements are commonly recognized as the most egregious forms of anti-competi-
tive conduct. See, for example, the OECD’s Recommendation of the Council concerning
Effective Action against Hard Core Cartels (1998), which condemned hard core cartels as
the “most egregious violations of competition law.” Available online at: www.oecd.org.
663
Competitor Collaboration Guidelines
ture). Other forms of competitor collaborations, such as joint ventures and strategic
alliances, may be subject to review under a civil agreements provision that prohib-
its agreements only where they are likely to substantially lessen or prevent
competition.
The Bureau recognizes the need for transparency and predictability regarding its
assessment of competitor collaborations. Accordingly, these Guidelines are in-
tended to assist firms in assessing the likelihood that a competitor collaboration
will raise concerns under the criminal or civil provisions of the Act and, if so,
whether the Commissioner would commence an inquiry in respect of the
collaboration.
Interpretation
These Guidelines describe the general approach of the Bureau in applying sections
45 and 90.1 of the Act to collaborations between competitors. They supersede all
previous statements of the Commissioner of Competition (the “Commissioner”) or
other officials of the Bureau regarding the administration and enforcement of sec-
tions 45 and 90.1 of the Act.
The nature and scope of competitor collaborations vary greatly. As a result, these
Guidelines cannot provide a comprehensive review of all competition issues that
may arise from a given collaboration, nor do they replace the advice of legal coun-
sel. Firms contemplating collaborations with competitors are encouraged to seek
advice regarding specific issues that may arise. Guidance regarding future business
conduct can be obtained by requesting a binding written opinion from the Commis-
sioner under section 124.1 of the Act.
These Guidelines are not intended to restate the law or to constitute a binding state-
ment of how the Commissioner or the Director of Public Prosecutions2 (the “DPP”)
will exercise discretion in a particular situation. The respective enforcement and
prosecutorial decisions of the Commissioner and the DPP, and the ultimate resolu-
tion of issues, will depend on the particular circumstances of the matter in question.
Final interpretation of the law is the responsibility of the Competition Tribunal (the
“Tribunal”) and the courts.
The Bureau may revisit certain aspects of these Guidelines in the future in light of
experience, changing circumstances and decisions of the Tribunal and the courts.
2 On December 12, 2006, the Office of the Director of Public Prosecutions was created as
part of the Federal Accountability Act. This statute gives the Director of Public Prosecutions
jurisdiction to conduct prosecutions for offences under federal jurisdiction. This office is
independent of the Commissioner and the Department of Justice and assumed the duties of
the former Federal Prosecution Service.
664
Organization of These Guidelines

These Guidelines are organized into five sections:
• Section 1 provides an overview of the analytical framework applied by the
Bureau in assessing existing and proposed collaborations between competi-
tors, including how the Bureau will determine whether the collaboration
should be assessed under the conspiracy provision in section 45, the civil
agreements provision in section 90.1 or other provisions of the Act.
• Section 2 explains how the Bureau will assess competitor collaborations under
the criminal conspiracy provision in section 45 of the Act.
• Section 3 explains how the Bureau will assess competitor collaborations under
the civil agreements provision in section 90.1 of the Act.
• Section 4 provides a number of hypothetical examples illustrating the Bu-
reau’s approach to the application of sections 45 and 90.1 of the Act.
• Section 5 contains the text of the relevant provisions of the Act.
Table of Contents
Section 1: Analytical Framework . . . . . . . . . . . . . . . . . . . . . . . . . . . 666

1.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 666
Guidelines
1.2 Distinguishing Between Civil Agreements / Conspiracy Provisions or
Other Provisions of the Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 666
1.3 Criminal or Civil Track . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 668
1.4 Duplicate Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 669
Section 2: The Criminal Prohibition . . . . . . . . . . . . . . . . . . . . . . . . . 670

2.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 670
2.2 What Constitutes a Conspiracy, Agreement or Arrangement . . . . . . 671
2.3 Who is a Competitor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 672
2.4 Types of Prohibited Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . 675
2.5 Ancillary Restraints Defence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 677
2.6 Other Defences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 680
2.7 Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 681
2.8 Immunity and Leniency Programs . . . . . . . . . . . . . . . . . . . . . . . . . . 682
Section 3: The Civil Agreements Provision . . . . . . . . . . . . . . . . . . . 683

3.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 683
3.2 What Constitutes an Agreement or Arrangement . . . . . . . . . . . . . . . 684
3.3 Who is a Competitor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 684
3.4 Anti-Competitive Threshold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 685
665
3.5 Defences and Exceptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 686

3.6 Commercialization and Joint Selling Agreements . . . . . . . . . . . . . . 689
3.7 Information Sharing Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . 691
3.8 Research and Development Agreements . . . . . . . . . . . . . . . . . . . . . 693
3.9 Joint Production Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 695
3.10 Joint Purchasing Agreements and Buying Groups . . . . . . . . . . . . . 697
3.11 Non-Compete Clauses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 700
Section 4: Hypothetical Illustrative Examples . . . . . . . . . . . . . . . . . 700
Section 5: Relevant Provisions of the Act . . . . . . . . . . . . . . . . . . . . 710
Section 6: How to Contact the Competition Bureau . . . . . . . . . . . . 714
1. — Analytical Framework
1.1 — Overview
This Section of the Guidelines outlines the Bureau’s approach to determining
whether to assess an agreement or collaboration between competitors under the
criminal conspiracy provision, civil agreements provision or other provisions of the
Act. As described below, the amended criminal prohibition is reserved for agree-
ments between competitors to fix prices, allocate markets or restrict output that
constitute “naked restraints” on competition (restraints that are not implemented in
furtherance of a legitimate collaboration, strategic alliance or joint venture). Other
forms of competitor collaborations, such as joint ventures and strategic alliances,
may be subject to review under the civil agreements provision in section 90.1 that
prohibits agreements only where they are likely to substantially lessen or prevent
competition.
1.2 — Distinguishing Between Civil Agreements / Conspiracy

Provisions or other Provisions of the Act
As an initial step, the Bureau will determine whether to assess the collaboration
between competitors under the conspiracy and civil agreements provisions found in
sections 45 and 90.1 of the Act, respectively, or whether the collaboration should
be assessed under other provisions of the Act, such as the merger provision in sec-
tion 92. The Bureau applies the following principles in making this determination:
(a) Mergers: A proposed or completed acquisition of control over, or signifi-
cant interest in, the whole or part of a business through the purchase or lease
of shares or assets, by amalgamation or combination, will be assessed under
the merger provisions in section 92 and following of the Act, and not the civil
agreements provision in section 90.1 or the conspiracy provision in section 45
of the Act. Parties who are uncertain as to whether an agreement will be as-
666
sessed as a merger or a competitor collaboration are encouraged to contact the

Bureau at the earliest opportunity to discuss how the Bureau will assess such
an agreement.
(b) Agreements Between Federal Financial institutions: Where the agreement
is between federal financial institutions and is described in subsection 49(1) of
the Act, the agreement will be assessed under section 49 and not section 45.3
Agreements that fall within the ambit of subsection 49(1), but are exempted by
subsection 49(2), will not be assessed under section 45, but may be subject to
review under the civil provisions where such agreements are likely to substan-
tially lessen competition. Agreements between federal financial institutions
that are not described in subsection 49(1) may be assessed under section 45;
similarly, such agreements between federal financial institutions that are likely
to substantially lessen competition may be subject to review under the civil
agreements provision in section 90.1 of the Act, subject to applicable excep-
tions, such as subsection 90.1(9), which creates an exception for agreements in
respect of which the Minister of Finance has issued a certification for reasons
of financial policy.
(c) Vertical Agreements Between Suppliers and Customers: Vertical agree-
ments between suppliers and customers will be assessed under the reviewable
matters provisions found in Part VIII of the Act, such as section 76 (price
maintenance) and 79 (abuse of dominance), and not under the conspiracy pro-
Guidelines
vision in section 45. The Bureau recognizes that, in some circumstances, a
supplier may compete with a customer in respect of the product that is being
supplied. As more particularly described at section 2.3.3 of these Guidelines,
the Bureau will generally assess agreements between suppliers and distributors
in such dual-distribution arrangements under the civil provisions found in Part
VIII of the Act, and not under the criminal conspiracy provision in section 45
of the Act.
(d) Bid-rigging: Where the agreement between competitors is limited to “bid-
rigging”, as defined in section 47 of the Act, the agreement will be assessed
under section 47 or section 90.1, and not section 45. In particular, the Bureau
will not assess under section 45 agreements among bidders to submit or with-
draw a bid that are made known to the person who called or requested the bids
or tenders, at or before the time of submission or withdrawal. The Bureau rec-
ognizes that bidders may need to form bid consortia to effectively bid for cer-
tain projects. However, where such agreements substantially lessen competi-
tion among bidders, they may be assessed under section 90.1 of the Act. Also,
where an agreement includes other restraints on competition apart from bid-
rigging that may contravene the conspiracy provision in section 45 (such as
where competitors agree to rig bids and allocate markets) or if the bid-rigging
is part of a broader conspiracy to lessen competition, the agreement may be
assessed under either or both of sections 45 and 47.
3 See paragraph 45(6)(b) of the Act.
667
(e) Abuse of Dominance: While agreements between competitors that are not
conspiracies under section 45 or mergers within the meaning of section 91 will
generally be examined by the Bureau under section 90.1, such agreements
may also be examined pursuant to the abuse of dominance provision found in
section 79 of the Act in certain circumstances. For example, the Bureau may
seek a remedy under section 79 with respect to an agreement between compet-
itors where the competitors are jointly dominant and the agreement has or fa-
cilitates conduct that has a negative effect on a competitor that is exclusionary,
predatory or disciplinary such that it has had, is having or is likely to have the
effect of preventing or lessening competition substantially in a market.4
1.3 — Criminal or Civil Track

Where the Bureau has determined that an agreement should be evaluated under
either section 45 or 90.1, as distinct from other provisions of the Act, the Bureau
will then determine, based on any available evidence, whether the criminal provi-
sion in section 45 or the civil agreements provision in section 90.1 is applicable to
the agreement. As described more fully in Section 2 of these Guidelines, only cer-
tain types of agreements or arrangements may be subject to criminal prosecution
under section 45 of the Act. As explained in greater detail in these Guidelines, the
amended criminal prohibition is reserved for agreements between competitors to
fix prices, allocate markets or restrict output that constitute “naked restraints” on
competition (restraints that are not implemented in furtherance of a legitimate col-
laboration, strategic alliance or joint venture). Other forms of competitor collabora-
tions, such as joint ventures and strategic alliances, may be subject to review under
a civil agreements provision that prohibits agreements only where they are likely to
substantially lessen or prevent competition. Once the Bureau communicates to the
parties that the agreement will be reviewed solely under the civil agreements provi-
sion, the Bureau will not refer the agreement to the DPP for prosecution on the
basis of the same or substantially the same facts. The Bureau will make every effort
to arrive at a timely decision on the appropriate section to be applied in evaluating
an agreement.
Where the agreement falls within one of the categories prohibited by subsection
45(1), the Bureau will then consider whether the ancillary restraints defence, or
another defence set out in subsection 45(5) or 45(6), may apply. As described in
Section 2 of these Guidelines, agreements that are directly related to, and reasona-
bly necessary for, giving effect to a broader agreement may be subject to an ancil-
lary restraints defence.
Where the Bureau determines that there is sufficient evidence to establish that an
agreement is an ancillary restraint for the purpose of subsection 45(4), the Commis-
4 Further details on the Bureau’s enforcement policy in respect of abuse of dominance can
be found in the Bureau’s draft Updated Enforcement Guidelines on the Abuse of Dominance
Provisions — Sections 78 and 79 of the Competition Act (2009), available online at:
www.competitionbureau.gc.ca.
668
sioner will not refer the matter to the DPP with a recommendation to commence a
prosecution under section 45, but may seek a remedy in respect of the agreement
under the civil agreements provision in section 90.1 if the Commissioner is of the
view that the agreement is likely to substantially lessen or prevent competition.
In carrying out its responsibilities to administer and enforce the Act, the Bureau is
guided by its Information Bulletin on the Conformity Continuum5 (the “Conformity
Continuum”), which describes the principles applied by the Bureau in determining
the appropriate method to address a possible violation of the Act. Where the Com-
missioner has not referred a matter to the DPP or filed an application before the
Tribunal, the Bureau may determine that it is appropriate to resolve a matter by
way of an alternative case resolution.
Parties may approach the Bureau at any time to resolve a criminal matter prior to
referral to the DPP for prosecution. However, in the criminal context, the DPP has
the sole authority to engage in plea and sentencing discussions with counsel for an
accused. Sentencing discussions can include consideration of a prohibition order
under section 34 of the Act, in addition to, or in lieu of, a guilty plea, fine and/or
imprisonment. When a criminal matter is referred to the DPP, the Commissioner
typically provides sentencing recommendations and Bureau officers assist the DPP
in sentencing discussions.
While the Bureau may initially elect to evaluate the agreement under the criminal
conspiracy provision, the Bureau may subsequently decide that circumstances war-
Guidelines
rant pursuing a remedy under the civil agreements provision at any time prior to
referral of the matter to the DPP for prosecution. In cases where the matter is re-
ferred but the DPP elects not to pursue a prosecution, the Bureau may choose to
reevaluate whether the agreement should be subject to a remedy under the civil
provisions in Part VIII of the Act. At no time will the Bureau use the threat of
criminal prosecution to induce settlement in cases proceeding by way of the civil
track.
1.4 — Duplicate Proceedings

The Act contains a number of sections that prevent the Commissioner and the DPP
from simultaneously pursuing duplicate proceedings under multiple provisions of
the Act. Specifically, section 45.1 states as follows:
45.1 No proceedings may be commenced under subsection 45(1) against a person on
the basis of facts that are the same or substantially the same as the facts on the basis
of which an order against that person is sought by the Commissioner under section
76, 79, 90.1 or 92.
5 Available online at: www.competitionbureau.gc.ca.
669
Similarly, subsection 90.1(10) provides as follows:

90.1 (10) No application may be made under this section against a person on the
basis of facts that are the same or substantially the same as the facts on the basis of
which
(a) proceedings have been commenced against that person under section 45 or
49; or
(b) an order against that person is sought by the Commissioner under section
76, 79 or 92.
Accordingly, when the Commissioner has initiated proceedings before the Tribunal
in respect of an agreement under section 76, 79, 90.1 or 92 of the Act, the Commis-
sioner will not subsequently refer that same agreement to the DPP for prosecution
under section 45 on the basis of the same or substantially the same facts.
For the purposes of section 45.1, the Bureau considers that proceedings have been
initiated before the Tribunal once an application has been filed with the Tribunal by
the Commissioner under Part VIII of the Act in respect of the agreement.
Similarly, where proceedings have been commenced by the DPP under section 45
in respect of an agreement, the Commissioner will not subsequently initiate pro-
ceedings before the Tribunal under section 76, 79, 90.1 or 92 on the basis of the
same or substantially the same facts. For the purpose of subsection 90.1(10), the
Bureau considers that proceedings have been commenced under section 45 upon
the laying of charges.
The same principles outlined above will apply to the duplicate proceedings provi-
sions applicable to sections 45 and 90.1 found elsewhere in the Act.6
2. — The Criminal Prohibition

2.1 — overview
Section 457 describes categories of agreements that are so likely to harm competi-
tion and to have no pro-competitive benefits that they are deserving of prosecution
without a detailed inquiry into their actual competitive effects. These are agree-
ments between competitors to fix prices, allocate markets or restrict output that
constitute “naked restraints” on competition (restraints that are not implemented in
furtherance of a legitimate collaboration, strategic alliance or joint venture). The
categories of agreements described in subsection 45(1) are per se8 unlawful and are
subject to significant criminal sanctions. Other forms of competitor collaborations,
such as joint ventures and strategic alliances, may be subject to review under the
6 See, for example, sections 45.1 and 98 and subsection 49(4).

7 Upon coming into force on March 12, 2010, this provision applies to agreements in exis-
tence at that date, as well as agreements entered into following that date.
8 That is, the behaviour is deemed to be illegal without requiring proof of anti-competitive
effects.
670
civil agreements provision in section 90.1, which prohibits agreements only where
they are likely to substantially lessen or prevent competition.
Subsection 45(1) states:
45. (1) Every person commits an offence who, with a competitor of that person with
respect to a product, conspires, agrees or arranges
(a) to fix, maintain, increase or control the price for the supply of the product;
(b) to allocate sales, territories, customers or markets for the production or sup-
ply of the product; or
(c) to fix, maintain, control, prevent, lessen or eliminate the production or sup-
ply of the product.
This Section describes the Bureau’s approach in evaluating each of the elements of
section 45 of the Act, including a consideration of whether any defences and excep-
tions may apply.
2.2 — What Constitutes a Conspiracy, Agreement or Arrangement

Subsection 45(1) applies to agreements, arrangements or conspiracies between or
among competitors or potential competitors in respect of a product9 to fix prices,
allocate markets or restrict output for that product.
In determining whether an agreement10 exists, the Bureau will consider whether the
Guidelines
parties to the alleged agreement or arrangement reached a “meeting of the minds”,
either explicitly or tacitly, to engage in the conduct described in subsection 45(1).
This subsection will apply to all forms of agreements between competitors, regard-
less of the degree of formality or enforceability and regardless of whether it has
been implemented. Indeed, agreements between competitors to fix prices, allocate
markets and reduce output are often concealed and not reduced to writing. How-
ever, the simple fact that an agreement is overt, rather than covert, does not shield it
from the application of section 45.
An agreement may be established through direct evidence that the accused entered
into an agreement, or it may be inferred from a course of conduct or other evidence.
In this regard, subsection 45(3) of the Act specifically provides that, in a prosecu-
tion under subsection 45(1), the court may infer the existence of a conspiracy,
agreement or arrangement from circumstantial evidence, with or without direct evi-
dence of communication between or among the alleged parties to the agreement. In
any event, the existence of an agreement must be proved beyond a reasonable
doubt.
Becoming a party to an agreement described in subsection 45(1) at any time is
sufficient to establish the offence. Further, in order to constitute the offence of con-
spiracy, there is no need to establish that the object of the conspiracy was, in fact,
9 For the purpose of the Act, a product includes an article and a service.
10 For greater certainty, the term “agreement” is understood to include arrangements and
conspiracies.
671
carried out or that any acts were taken in furtherance of the conspiracy. The offence
is established at the time of the agreement between competitors to engage in the
conduct described in subsection 45(1) and is a continuing offence for the period of
the conspiracy.11 Similarly, there is no requirement to prove that each party took
active steps during the period of the conspiracy; rather, it need only be established
that the individual or firm was a party to the conspiracy at any time during the
relevant period.
The Bureau does not consider that the mere act of independently adopting a com-
mon course of conduct with awareness of the likely response of competitors or in
response to the conduct of competitors, commonly referred to as “conscious paral-
lelism”, is sufficient to establish an agreement for the purpose of subsection 45(1).
However, parallel conduct coupled with facilitating practices, such as sharing com-
petitively sensitive information or activities that assist competitors in monitoring
one another’s prices, may be sufficient to prove that an agreement was concluded
between the parties.
2.3 — Who is a Competitor

2.3.1 — Generally
Section 45 prohibits certain agreements between parties who compete or are poten-
tial competitors with respect to the products that are the subject of the agreement.
Therefore, where parties compete, or are likely to compete, only in respect of prod-
ucts that are not subject to the agreement, this is not sufficient to establish that the
parties are competitors for the purpose of section 45. Rather, to be considered com-
petitors for the purpose of section 45, the parties must compete, or be likely to
compete, with respect to the products that are the subject of the agreement alleged
to contravene section 45. For greater certainty, unless otherwise specified in these
Guidelines, the term “competitors” is understood to include potential competitors.
As discussed below, section 45 does not apply to agreements that are entered into
only between corporations that are affiliated. However, an agreement that is
reached between, for example, one director, officer or employee of a corporation
and a director, officer or employee of a competing corporation is considered to be
an agreement between competitors for the purpose of section 45. In this circum-
stance, the individual employees who entered into the agreement may be subject to
prosecution under section 45 of the Act. Further, corporations may be subject to
prosecution as a result of an agreement between their respective employees or other
representatives.12
11 See, for example, Atlantic Sugar Refineries Co. v. Canada (Attorney General), [1980] 2
S.C.R. 644.
12 See sections 22.1 and 22.2 of the Criminal Code. In such cases, the corporation would be
deemed a party to the offence and would be subject to the same monetary penalties as the
respective employees or other representatives who committed the offence.
672
Where an agreement involves competing and non-competing parties, the fact that
some parties are not competitors does not insulate the competing parties from pros-
ecution under section 45. Parties that are not competitors may also be prosecuted
under section 45 through the aiding and abetting provisions in section 21 or the
counselling provisions in section 22 of the Criminal Code (the “Code”) in circum-
stances where the conditions of those sections are met.13
Agreements between members of a trade or other industry association may also
constitute agreements between competitors for the purpose of section 45. Rules,
policies, by-laws or other initiatives enacted and enforced by an association with
the approval of members who are competitors, are considered by the Bureau to be
agreements between competitors for the purpose of section 45. In the event that
such an agreement contravenes section 45, the trade association may be considered
as a principal party to the offence or may be subject to prosecution through the
aiding and abetting provisions in section 21 of the Code.
In determining whether parties to an agreement are competitors for the purpose of
section 45, the Bureau is of the view that it is not required to engage in a detailed
definition of the relevant market(s), in the sense of having to plead and prove the
full nature and extent of the market and the participants within it. However, the
Bureau may nonetheless seek to gather information relating to the market to more
fully understand, among other things, the context of the agreement. As long as the
parties are offering, or, in the absence of the agreement, would likely offer, the
Guidelines
same or otherwise competing products in the same or otherwise competing regions,
the Bureau will generally conclude that the parties are in competition with one an-
other for the supply of such products.
2.3.2 — Potential Competitors

As noted above, section 45 applies to agreements between parties that are potential
competitors. Accordingly, the fact that parties were not in competition when the
agreement was concluded or during the term of the agreement is not in and of itself
sufficient to avoid liability under section 45. In this regard, a competitor is defined
by subsection 45(8) to include firms that are likely to compete with respect to a
product in the absence of the impugned agreement.
As with actual competitors, the Bureau is of the view that a determination of
whether parties are likely to compete does not require a detailed market analysis.
Rather, to determine whether parties are potential competitors, the Bureau will con-
sider evidence regarding whether the parties to the agreement were planning to of-
fer, were likely to offer, or had offered the same or otherwise competing products
in the same or otherwise competing regions. In evaluating this issue, the Bureau
13 Under section 21 of the Code, a person who does something or omits to do something that
aids in the commission of an offence may be liable as a party to the offence. Similarly, a
person who encourages a party to commit an offence may be liable as a party to the offence.
As a party to the offence, the person would be subject to the same penalties (including a fine
and/or term of imprisonment) as the person who commits the offence.
673
will have regard to any evidence indicating whether firms were likely to compete or
had competed, including business and strategic plans prepared in the ordinary
course of business, marketing and communications with potential customers, and
evidence of actual competition for similar customers in neighbouring regions or in
respect of similar products. The Bureau will consider this issue with respect to the
periods both prior to and following the implementation of the agreement.
2.3.3 — Dual-Distribution and Franchise Arrangements

The Bureau does not consider a supplier of a customer to be a competitor of a
customer in respect of the product being supplied. For example, the Bureau will not
assess under section 45 an agreement whereby a supplier and customer agree upon
the price at which the customer will purchase the product from the supplier.
The Bureau recognizes that in some circumstances, however, a supplier may, in
fact, compete with a customer in respect of the product that is being supplied. For
example, a supplier may sell products to a distributor for resale in the market while
also electing to sell these products directly into the market. Such supplier-distribu-
tor arrangements may also take the form of agreements between principal and
agent.
It may be difficult to distinguish between a horizontal and vertical restraint in a
dual-distribution context where the supplier competes for sales with its unaffiliated
distributors. Given that such agreements can be pro-competitive, they are not de-
serving of condemnation without an inquiry into their actual competitive effects.
Indeed, the distributor’s status as a competitor to the supplier may only arise as a
result of the dual-distribution arrangement. Accordingly, the Bureau will assess
agreements between suppliers and distributors in a dual-distribution arrangement
under the civil provisions found in Part VIII of the Act, and not under the criminal
conspiracy provision in section 45 of the Act. However, the mere existence of a
dual-distribution arrangement between two parties does not foreclose the possibility
that agreements between these parties to fix prices, allocate markets or restrict out-
put with respect to products that are not supplied as part of the dual-distribution
arrangement may be subject to section 45. Further, the Bureau may apply section
45 where the agreement is, in fact, an agreement between suppliers or an agreement
between distributors to restrain competition among themselves in their capacity as
competitors, such as by allocating markets or fixing prices.
The Bureau will apply these same principles to its evaluation of franchise agree-
ments. Specifically, the Bureau will examine agreements between franchisors and
franchisees that allocate markets or customers for the operations of the fran-
chisee — such as where the franchise agreement provides franchisees with an au-
thorized sales territory — under Part VIII of the Act and not under the criminal
conspiracy provision in section 45 of the Act. The Bureau does not consider such
vertical arrangements to be agreements between competitors for the purpose of sec-
tion 45. Again, the foregoing is subject to the exceptions outlined above, such as
where the agreement is, in fact, an agreement among the franchisees to restrain
competition among themselves.
674
2.4 — Types of Prohibited Agreements

Broadly speaking, section 45 prohibits agreements between competitors or poten-
tial competitors to fix prices, allocate markets or reduce output that constitute “na-
ked restraints” on competition (restraints that are not implemented in furtherance of
a legitimate collaboration, strategic alliance or joint venture). The Bureau’s ap-
proach to evaluating whether an agreement falls into each of these categories is
outlined below.
2.4.1 — Price-Fixing Agreements

Paragraph 45(1)(a) of the Act prohibits agreements between competitors in respect
of a product “to fix, maintain, increase or control the price for the supply of the
product”. Further, subsection 45(8) defines the term “price” to include “any dis-
count, rebate, allowance, price concession or other advantage in relation to the sup-
ply of a product”. Taken together, these provisions prohibit agreements between
competitors to fix or control the price, or any component of the price, to be charged
by such competitors. In the Bureau’s view, this includes agreements to fix prices at
a predetermined level, to eliminate or reduce discounts, to increase prices, to reduce
the rate or amount by which prices are lowered, to eliminate or reduce promotional
allowances and to eliminate or reduce price concessions or other price-related ad-
vantages provided to customers. For paragraph 45(1)(a) to apply, the agreement
need not establish an actual price for the relevant product; rather, this section also
Guidelines
prohibits agreements between competitors on methods of establishing prices or
other indirect forms of agreements to fix or increase the price paid by customers.
Such price-fixing agreements could include agreements between competitors to use
a common price list in their negotiations with customers, agreements to apply spe-
cific price differentials between grades of products, agreements to apply a pricing
formula or scale and agreements not to sell products below cost. In addition, the
Bureau interprets paragraph 45(1)(a) as applying to agreements between competi-
tors on a component of a price, such as a surcharge or credit terms.
The Bureau does not interpret paragraph 45(1)(a) to prohibit agreements solely on
the basis that they have the effect of increasing prices charged by competitors. For
example, an agreement among competitors to implement certain measures designed
to protect the environment or implement a new industry standard may increase the
costs of producing a product and ultimately result in an increase in price. However,
the Bureau does not consider such initiatives alone to be agreements to fix or in-
crease prices. Even if such arrangements are considered to be agreements to fix or
increase prices, such agreements could be subject to the ancillary restraints defence
discussed below.
The prohibition in paragraph 45(1)(a) applies to the price for the supply of a prod-
uct, and not to the price for the purchase of a product. Accordingly, joint purchas-
ing agreements — even those between firms that compete in respect of the
purchase of products — are not prohibited by section 45, but may be subject to a
remedy under the civil agreements provision in section 90.1 where they are likely
to substantially lessen or prevent competition. The Bureau recognizes that small-
and medium-sized firms often enter into joint purchasing agreements to achieve
675
discounts similar to those obtained by larger competitors. Given that such agree-
ments can be pro-competitive, they are not deserving of condemnation without a
detailed inquiry into their actual competitive effects; as such, they should only be
subject to review under the civil agreements provision in section 90.1.
In contrast, certain joint selling agreements may violate paragraph 45(1)(a) of the
Act. Specifically, joint selling agreements that are, in substance, simply agreements
between competitors to fix prices will be assessed by the Bureau under paragraph
45(1)(a). A joint selling agreement that restricts the supply of competing products
to certain territories or customers could also violate the prohibitions in paragraphs
45(1)(b) and (c) relating to market allocation and output restriction. Similarly, cer-
tain other forms of commercialization agreements between competitors may also
violate subsection 45(1) of the Act. For a further discussion of the Bureau’s ap-
proach to evaluating commercialization agreements and joint selling agreements,
please see section 3.6 of these Guidelines.
2.4.2 — Market Allocation Agreements

Paragraph 45(1)(b) of the Act prohibits agreements between competitors in respect
of a product “to allocate sales, territories, customers or markets for the production
or supply of the product”. This provision prohibits all forms of market allocation
agreements between competitors, including agreements between competitors to not
compete with respect to specific customers, groups or types of customer, in certain
regions or market segments, or in respect of certain types of transactions or prod-
ucts. The prohibition in paragraph 45(1)(b) applies to agreements to not compete
with respect to direct sales to distributors, resellers or customers, as well as agree-
ments entered into by suppliers to not compete in respect of indirect sales that are
made through distributors or resellers. This provision prohibits market allocation
agreements between actual and potential competitors.
As noted above, the Bureau does not consider parties that are only suppliers of a
customer to be competitors of that customer in respect of the product that is being
supplied. For example, as discussed in section 2.3.3 of these Guidelines, the Bureau
will not normally apply paragraph 45(1)(b) to agreements that allocate markets for
the resale of products supplied by a supplier to a customer, even where the supplier
also competes with the customer in respect of the sale of that product. Rather, such
dual-distribution arrangements will be evaluated by the Bureau under the civil pro-
visions found in Part VIII of the Act.
2.4.3 — Output Restriction Agreements

Paragraph 45(1)(c) of the Act prohibits agreements between competitors in respect
of a product “to fix, maintain, control, prevent, lessen or eliminate the production
or supply of the product”. This provision prohibits all forms of output restriction
agreements between competitors, including agreements between competitors to
limit the quantity or quality of products supplied, reduce the quantity or quality of
products supplied to specific customers or groups of customers, limit increases in
the quantity of products supplied by a set amount or discontinue supplying products
to specific customers or groups of customers. The prohibition in paragraph 45(1)(c)
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applies to agreements to restrict the supply or production of a product. Accord-

ingly, agreements between competitors to impose production quotas, permanently
or temporarily close manufacturing facilities, reduce the quality of components
used in a product, or other agreements to reduce the quantity or quality of products
that are produced can violate paragraph 45(1)(c).
2.5 — Ancillary Restraints Defence

Subsection 45(4) provides a defence for ancillary restraints. The Bureau recognizes
that some desirable business transactions or collaborations require explicit re-
straints to make them efficient, or even possible. For example, one or more parties
to a joint venture or licensing arrangement may refuse to participate in such ar-
rangements without some explicit restraint on competition. Similarly, parties may
not wish to invest in the joint development of a product where one party is able to
independently compete with the joint venture. Although such ancillary restraints
may fall within the type of conduct described in subsection 45(1), they are more
appropriately subject to review under the civil agreements provision in section 90.1
of the Act. As explained elsewhere in these Guidelines, the criminal prohibition in
section 45 is reserved for agreements between competitors to fix prices, allocate
markets or restrict output that constitute “naked restraints” on competition (re-
straints that are not implemented in furtherance of a legitimate collaboration, strate-
gic alliance or joint venture).
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For the purpose of subsection 45(4), an ancillary restraint is an agreement or term
of an agreement that contravenes the prohibitions in subsection 45(1), but which is
directly related to, and reasonably necessary for giving effect to, a broader and law-
ful agreement. For example, the Bureau will generally not assess the following
types of ancillary restraints under the criminal provision in section 45 of the Act,
although (as noted above) these restraints may be subject to review under the civil
provisions of the Act:
(a) A non-compete clause found in an employment agreement, or an agree-
ment for the sale of assets or shares between parties;
(b) An agreement among competitors to charge a common price in a blanket
license agreement for artistic works;
(c) An agreement to abstain from making material changes to a business pend-
ing the consummation of a merger; and
(d) A non-compete obligation between the parent undertakings and a joint
venture where such obligations correspond only to the products, services and
territories covered by the joint venture agreement.
The ancillary restraints defence is available when:
(a) The restraint is ancillary to a broader or separate agreement that includes
the same parties;
(b) The restraint is directly related to, and reasonably necessary for giving ef-
fect to, the objective of the broader or separate agreement referred to in (a)
above; and
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(c) The broader or separate agreement referred to in (a) above, when consid-
ered in the absence of the restraint, does not contravene subsection 45(1).
Each element of the ancillary restraints defence is discussed in turn below.
2.5.1 — Onus
The Crown bears the onus of establishing beyond a reasonable doubt that the re-
straint contravenes the prohibitions in subsection 45(1) (for example, the restraint is
an agreement or term of an agreement between competitors to fix prices, allocate
markets or reduce output). The parties to the agreement must establish on a balance
of probabilities the first and second elements of the defence: that the challenged
restraint is ancillary to a broader or separate agreement, and that the restraint is
directly related to, and reasonably necessary for giving effect to, the objective of
the broader or separate agreement. It is appropriate for the parties to establish these
elements given that much of the information relating to these elements is in their
possession. Further, requiring that the parties raise only a reasonable doubt as to the
existence of these elements of the defence may permit cartel conduct to escape
conviction too readily and excessively compromise the effectiveness of section 45
of the Act, contrary to the public interest.
2.5.2 — Ancillary to a Broader or Separate Agreement

To be eligible for the defence in subsection 45(4), the challenged restraint must be
“ancillary” to a broader or separate agreement that includes the same parties. The
Bureau interprets “ancillary” to mean that the restraint is a part of an agreement or
is a separate agreement that is functionally incidental or subordinate to the objec-
tive of some broader agreement. The Bureau distinguishes between ancillary re-
straints (those that are truly subordinate and collateral to a broader agreement) and
“naked restraints” (those that are not implemented in furtherance of a legitimate
collaboration, strategic alliance, or joint venture). In making this determination, the
Bureau will have regard to the terms of the agreement, the form of the agreement
(the Bureau anticipates that ancillary restraints will typically be reduced to writing
as part of formal agreements), the functional relationship or lack thereof between
the restraint and the principal agreement, and how the restraint makes the main
agreement more effective in accomplishing its purpose. In short, to invoke the de-
fence, the parties to the agreement must establish that the challenged restraint does
not represent the object of their cooperation, but rather constitutes a matter func-
tionally incidental and subordinate to the purpose or end of their collaboration.
As noted above, the ancillary restraint may be a term in a broader agreement. For
example, the ancillary restraint could be a non-compete clause that is contained in
one section of a broader agreement. The ancillary restraint may also be contained in
a separate agreement that is ancillary to a broader agreement. For example, instead
of including a non-compete clause in an agreement, the parties may enter into a
separate non-compete agreement. Both types of ancillary restraints qualify for the
defence under subsection 45(4), provided the remaining conditions are satisfied.
The defence in subsection 45(4) does not require that the parties to the challenged
restraint and the broader or separate agreement be identical. However, the broader
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or separate agreement must include all of the parties to the agreement containing
the ancillary restraint. For example, the defence is still available where the parties
to a non-compete agreement are a subset of the parties to a separate joint venture or
commercialization agreement.
2.5.3 — Directly Related and Reasonably necessary for Giving Effect to a

Broader objective
The challenged restraint must be directly related to the objective of the broader
agreement. For a restraint to be directly related, it is not adequate to merely assert
that the participants would not enter into the broader agreement in the absence of
the challenged restraint. Nor is it adequate to demonstrate that the ancillary restraint
was entered into between the parties in the same context and at the same time as the
broader agreement. Rather, the parties must demonstrate that the restraint was di-
rected at the promotion or facilitation of an objective of the broader agreement.
There is no requirement under subsection 45(4) of the Act that the challenged re-
straint be the least restrictive alternative. Accordingly, in determining whether a
challenged restraint is reasonably necessary, the Bureau will not “second guess” the
parties with reference to some other restraint that may have been less restrictive in
some insignificant way. The Bureau will not examine theoretically less restrictive
alternatives that are not practical given the business circumstances. Nonetheless,
the ancillary restraints provision requires that restrictions be “directly related and
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reasonably necessary” to give effect to the objective of the broader agreement. Un-
less there are significantly less restrictivealternatives to give effect to the objective
of the broader agreement, the Bureau is likely to conclude that the restraint is rea-
sonably necessary. Where there are significantly less restrictive alternatives availa-
ble to the parties, the parties must demonstrate that the other alternatives were inad-
equate or impractical, or that such alternatives would not allow the parties to
achieve the objective of the agreement. If the parties could have achieved an
equivalent or comparable arrangement through practical, significantly less restric-
tive means that were reasonably available to the parties at the time when the agree-
ment was entered into, then the Bureau will conclude that the restraint was not
reasonably necessary. In examining this issue, the Bureau will also consider the
duration of the ancillary restraint, the subject matter of the restraint (e.g., whether it
applies to products outside of the collaboration) and the geographic scope of the
restraint to determine whether it is reasonably necessary to give effect to the objec-
tive of the broader agreement as required under the ancillary restraints defence.
For example, the Bureau will consider whether, in the absence of the restraint, the
collaboration would likely be implemented. To this end, the Bureau will consider
whether, in the absence of the restraint, the agreement could only be implemented
under considerably more uncertain conditions, at substantially higher cost or over a
significantly longer period. On this issue, the Bureau will have regard to, among
other things, the submissions of the parties to the Bureau, evidence created during
the evaluation and negotiation of the agreement that demonstrates the objectives of
the agreement, and any evidence of alternative options considered by the parties at
the time the agreement was negotiated.
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2.5.4 — Lawfulness of Principal Agreement

To qualify for the defence, the broader or separate agreement to which the restraint
is ancillary must not contravene section 45 of the Act. In other words, if the alleged
ancillary restraint is merely part of a broader price-fixing, market allocation or out-
put restriction cartel, the defence is unavailable.
2.6 — Other Defences

In addition to the ancillary restraints defence, a number of other defences or excep-
tions are found in the Act and other legislation. The exceptions found in section 45
are described below.
2.6.1 — Agreements Between Affiliates

Paragraph 45(6)(a) provides an exception for agreements that are entered into only
between companies that are affiliated. The definition of affiliated companies is set
out in subsection 2(2) of the Act and is reproduced in Section 5 of these Guidelines.
Parties should note that this exception applies only to companies, and not partner-
ships, trusts or other non-corporate entities or individuals, although the Bureau will
consider the nature of any common control or relationship between the parties
when determining whether referral of an agreement for prosecution is appropriate.
Finally, for the exception to apply, all of the parties to the agreement must be affili-
ated corporations; accordingly, an agreement between affiliated and unaffiliated
corporations may be prosecuted under subsection 45(1).
2.6.2 — Federal Financial institutions

As noted in section 1.2(b) of these Guidelines, where the agreement is between
federal financial institutions as described in subsection 49(1) of the Act, the agree-
ment will be assessed under section 49 and not section 45 of the Act. Subject to the
exception in subsection 90.1(9) for agreements in respect of which the Minister of
Finance has issued a certification, agreements between federal financial institutions
that are likely to substantially lessen competition may also be subject to review
under the civil agreements provision in section 90.1 of the Act.
2.6.3 — Export Agreements

Subsection 45(5) of the Act contains a qualified or limited exception for agree-
ments between competitors that relate only to the export of products from Canada.
As with the predecessor provisions found in subsection 45(5) prior to the 2009
amendments and similar provisions existing in other jurisdictions, the defence for
export agreements is designed to enhance export trade by facilitating export agree-
ments between competing firms. For the export defence to apply, the agreement
must relate only to the export of products from Canada and not, for example, the
supply of products to Canadian markets. In addition, pursuant to subsection 45(5),
the export defence will not apply where the agreement:
(a) has resulted in or is likely to result in a reduction or limitation of the real
value of exports of a product;
680
(b) has restricted or is likely to restrict any person from entering into or ex-
panding the business of exporting products from Canada; or
(c) relates only to the supply of services that facilitate the export of products
from Canada.
It should be noted that an export agreement that benefits from the defence in sub-
section 45(5) may be subject to prosecution or other proceedings in the jurisdic-
tions to which products are exported under the agreement. Further, where the ex-
port agreement is likely to prevent or lessen competition in Canada, the
Commissioner may seek a remedy in respect of the agreement under section 90.1 of
the Act. Please see section 3.5.3 of these Guidelines regarding the application of an
export defence in proceedings under section 90.1.
2.6.4 — Regulated Conduct

As described in the Bureau’s Technical Bulletin on “Regulated” Conduct14, the
Bureau recognizes that the regulated conduct doctrine may apply to the enforce-
ment of the Act, including the conspiracy provision in section 45, with respect to
conduct that is regulated by another federal, provincial or municipal law or legisla-
tive regime. The regulated conduct doctrine can operate so as to exempt an agree-
ment from the application of the Act. Subsection 45(7) provides that the regulated
conduct doctrine as it applied to section 45 prior to the 2009 amendments will con-
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tinue to apply to the amended section 45; as a result, the Bureau will continue to
apply the approach to the regulated conduct doctrine articulated in the Technical
Bulletin on “Regulated” Conduct in the assessment of matters under the amended
section 45 of the Act.15
2.6.5 — Specialization Agreements

Pursuant to section 90 of the Act, sections 45 and 90.1 of the Act do not apply in
respect of registered specialization agreements as defined in section 85 of the Act.
2.7 — Remedies
A range of potential remedies is available to address violations of the conspiracy
provision. If the Commissioner concludes that an offence has been committed, evi-
dence may be referred to the DPP with a recommendation that criminal charges be
14 Available online at: www.competitionbureau.gc.ca.

15 Following the decision of the Supreme Court of Canada in Garland v. Consumers Gas
Co., [2004] 1 S.C.R. 629, some commentators expressed concern that the removal of the
term “unduly” from section 45 would prevent the regulated conduct doctrine from being
applied in prosecutions under section 45. Subsection 45(7) clarifies that the removal of the
term “unduly” from section 45 of the Act and other changes implemented through the 2009
amendments do not impact the availability of the regulated conduct doctrine.
681
brought. The DPP will then decide whether a prosecution is in the public interest in
accordance with the criteria set out in the Federal Prosecution Service Deskbook.16
A person found guilty of an offence under subsection 45(1) may be imprisoned for
a maximum term of 14 years or subjected to a fine not exceeding $25 million, or to
both. Where there is a finding of guilt, in addition to a fine and/or imprisonment,
the Bureau will typically recommend that the DPP consider applying to a court
under subsection 34(1) of the Act for a prohibition order to prohibit any behaviour
that constitutes, or is directed toward, the commission of an offence. Such prohibi-
tion orders can last for up to 10 years and may include prescriptive terms requiring
positive steps or acts to ensure compliance with the law. Business organizations
and individuals may be subject to a prohibition order under subsection 34(1).
The Bureau will consider the merits of an alternative case resolution only in cases
where, for example, the actual or potential economic harm is negligible, there are
no aggravating factors and there are significant mitigating factors.
Alternative case resolutions include issuing a warning letter or seeking an undertak-
ing or a prohibition order. Under subsection 34(2) of the Act, a court may issue a
prohibition order without a finding of guilt where the court finds that a person has
done, is about to do or is likely to do any act or thing constituting or directed to-
ward the commission of an offence. Business organizations and individuals may be
subject to a prohibition order under subsection 34(2).
In urgent circumstances, the DPP may apply for an interim injunction under section
33 to temporarily halt behaviour that constitutes, or is directed toward, the commis-
sion of an offence pending a prosecution or the completion of proceedings under
subsection 34(2).
Section 36 of the Act provides a right of private action for the recovery of damages.
This remedy is available if there has been a violation of the criminal provisions of
the Act, or a failure to comply with an order of the Tribunal or a prohibition order
issued by a court. Recovery in proceedings under this provision can be equal to the
loss or damage suffered by the plaintiff.
2.8 — Immunity and Leniency Programs

Businesses or individuals involved in activities that may violate the criminal provi-
sions of the Act can, in certain circumstances, approach the Bureau and request
immunity from prosecution in return for cooperating with the Bureau’s investiga-
tion and any ensuing prosecutions. Under the Bureau’s Immunity Program, the
Commissioner will recommend that the DPP grant immunity to the first party that
16 See “Federal Prosecution Service Deskbook”, available online on the Public Prosecution
Service of Canada Web site at: www.ppsc-sppc.gc.ca.
682
comes forward and satisfies the identified criteria.17 However, the DPP has ulti-
mate discretion to accept or reject the Commissioner’s recommendation.
Immunity from prosecution is only available to the party involved in the offence
that is first-in to make an application. Subsequent parties to come forward are able
to request other types of lenient treatment granted by the DPP, such as recommen-
dations to the court for reduced fines in return for co-operation with the Bureau and
the DPP. For more information on the degree of lenient treatment and the timing of
a request for that treatment, see the Bureau’s draft bulletin on the Leniency
Program.18
3. — The Civil Agreements Provision

3.1 — Overview
Section 90.1 permits the Tribunal to issue certain remedies in respect of existing or
proposed agreements between competitors or potential competitors that are likely
to substantially lessen or prevent competition in any relevant market.19 Subsection
90.1(1) states:
90.1 (1) If, on application by the Commissioner, the Tribunal finds that an agree-
ment or arrangement — whether existing or proposed — between persons two or
more of whom are competitors prevents or lessens, or is likely to prevent or lessen
competition substantially in a market, the Tribunal may make an order
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(a) prohibiting any person — whether or not a party to the agreement or ar-
rangement — from doing anything under the agreement or arrangement; or
(b) requiring any person — whether or not a party to the agreement or arrange-
ment — with the consent of that person and the Commissioner, to take any
other action.
In many respects, agreements that fall within the scope of section 90.1 are ex-
amined in a manner consistent with the approach outlined in the Bureau’s Merger
Enforcement Guidelines (the “MEGs”). This Section of the Guidelines describes
the Bureau’s approach to evaluating each of the elements of section 90.1 of the Act,
including a consideration of whether any defences and exceptions may apply. In
addition, this Section describes the Bureau’s approach to assessing six common
forms of agreements between competitors; namely: commercialization agreements,
17 The Bureau’s Immunity Program under the Competition Act (2007), Adjustments to the
Immunity Program (2007) and Immunity Program Responses to Frequently Asked Questions
(2007) are available online at: www.competitionbureau.gc.ca.
18 For more information on how to apply for leniency, see the Draft Information Bulletin on
Sentencing and Leniency in Cartel Cases (2008), available online at:
19 For greater certainty, agreements between competitors that fall outside of the prohibitions
of subsection 45(1) or that satisfy the elements of the ancillary restraints defence can be
reviewed under section 90.1.
683
information sharing agreements, research and development agreements, joint pro-

duction agreements, joint purchasing agreements and non-compete agreements.
3.2 — What Constitutes an Agreement or Arrangement

In determining whether an agreement exists, the Bureau will consider whether the
parties to the alleged agreement or arrangement reached a consensus, either explic-
itly or tacitly. The Bureau does not consider that the mere act of adopting a com-
mon course of conduct with awareness of the likely response of competitors, com-
monly referred to as “conscious parallelism”, is sufficient to establish an agreement
for the purpose of section 90.1. As with subsection 45(1), the civil agreements pro-
vision can apply to all forms of agreements and arrangements20 between competi-
tors, regardless of the degree of formality. The existence of a written document
setting out the terms of the agreement between the parties may assist the Bureau in
understanding the terms of the agreement and the objectives underlying the
agreement.
3.3 — Who is a Competitor

Section 90.1 is applicable to agreements between parties who compete or who are
potential competitors with respect to the products that are the subject of the agree-
ment. As such, the Bureau will not consider parties to be competitors where parties
compete only in respect of products that are not subject to the agreement. The Bu-
reau may determine whether parties to an agreement are competitors as part of its
analysis of the nature and extent of the relevant market.
Agreements between members of a trade or industry association may also consti-
tute agreements between competitors for the purpose of section 90.1. The Bureau
considers that rules, policies, by-laws or other initiatives that prevent or lessen
competition substantially, and that are enacted and enforced by an association with
the approval of members who are competitors, constitute agreements between com-
petitors for the purpose of section 90.1.
As described above, section 90.1 also applies to agreements between parties that
are potential competitors. Subsection 90.1(11) defines competitors to include not
just actual competitors, but also “a person who it is reasonable to believe would be
likely to compete” with respect to the relevant product “in the absence of the agree-
ment or arrangement”. Accordingly, the fact that parties did not compete when the
agreement was concluded or during the term of the agreement is not alone suffi-
cient to avoid review under section 90.1.
In some instances, parties can become potential competitors as a result of their col-
laboration. For example, it may be necessary for parties to collaborate in order to
develop a product by combining complementary technologies. Owing to their col-
laboration, the parties may become potential competitors in respect of the supply of
the developed product. However, for the purposes of section 90.1, the Bureau will
20 For greater certainty, the term “agreement” is understood to include arrangements.
684
not consider parties to an agreement to be competitors in respect of the activity

covered by the collaboration in circumstances where the parties are unable to inde-
pendently develop the product, complete the project, or carry out the activity cov-
ered by the collaboration. If parties are likely to carry out the activity covered by
the collaboration independently, this does not mean that the collaboration will be
challenged, but only that further review may be required to determine if the collab-
oration raises concerns under section 90.1 of the Act. In assessing whether the par-
ties would have been able to independently carry out the activity covered by the
collaboration, the Bureau will consider a number of issues, including economies of
scale or scope generated by the collaboration and the necessity of risk-sharing be-
tween the parties.
3.4 — Anti-Competitive Threshold

3.4.1 — Overview
As set out in subsection 90.1(1), the Tribunal may make an order where it finds that
an existing or proposed agreement between competitors “prevents or lessens, or is
likely to prevent or lessen, competition substantially in a market”. A substantial
lessening or prevention of competition results from agreements that are likely to
create, maintain or enhance the ability of the parties to the agreement to exercise
market power. For example, an agreement can lessen competition where parties to
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the agreement are able to sustain higher prices than would exist in the absence of
the agreement by diminishing existing competition. An agreement can also prevent
competition by hindering the development of future competition. Where applicable,
the Bureau will consider whether an agreement is likely to substantially lessen or
prevent competition in the relevant market in which products are supplied by the
parties (the “downstream market”) and in the relevant market in which inputs are
purchased by the parties (the “upstream market”).
The Bureau’s approach to determining whether an agreement is likely to substan-
tially lessen or prevent competition (including issues such as substantiality, defin-
ing the relevant market, anti-competitive effects and the efficiency exception) is
consistent with the assessment conducted in respect of mergers as set out in the
MEGs. Readers are encouraged to consult the relevant portions of the MEGs for
further information regarding the Bureau’s approach to examining agreements
under section 90.1.
3.4.2 — Market Shares

Consistent with the MEGs, as a general rule, the Commissioner will not challenge
an agreement under section 90.1 on the basis of: (i) a concern related to the exer-
cise of market power by the parties to the agreement where the market share held
by the parties represents less then 35% of the relevant market; or (ii) a concern
related to a coordinated exercise of market power by firms in the relevant market
where the share of the four largest firms in the relevant market is less than 65%, or
the share of the parties to the agreement is less than 10% of the relevant market.
685
The Bureau will consider the share of the relevant market held by the parties at the
time the agreement is concluded and also, to the extent possible, the share of the
market that will be held by the parties during the term of the agreement. Parties
wishing to determine whether ongoing agreements are likely to be subject to chal-
lenge under section 90.1 must evaluate whether, as a result of changes to the mar-
ket structure that occur during the term of an agreement, the agreement is likely to
substantially lessen or prevent competition.
Subsection 90.1(3) of the Act provides that evidence as to the market shares held
by the parties to the agreement or the level of concentration in the relevant market
cannot constitute the sole basis upon which an agreement may be subject to a rem-
edy by the Tribunal. The fact that parties collectively hold a large share of the
relevant market or that the market is concentrated are highly relevant considera-
tions, but are not alone sufficient to warrant a remedy under section 90.1 of the Act.
3.4.3 — Entry or Expansion

In examining the competitive effects of a transaction, the Bureau will also consider
whether timely entry by potential competitors would likely occur on a scale and
magnitude to sufficiently constrain the ability of the parties to an agreement to ex-
ercise market power in the relevant market. As a general rule, in the absence of
impediments to entry, the parties’ attempt to exercise market power is likely to be
thwarted by entry of firms that: are already in the relevant market and can expand
production or sales; are not in the relevant market but operate in other product or
geographic markets and can switch production or sales into the relevant market; or
can begin production or sales into the relevant market de novo. For further discus-
sion of the Bureau’s approach regarding the likelihood of entry and barriers to en-
try, please see Part 6 of the MEGs.
3.4.4 — Additional Factors

Subsection 90.1(2) contains a non-exhaustive list of factors to which the Tribunal
may have regard in determining whether an agreement is likely to prevent or lessen
competition substantially. The factors listed in subsection 90.1(2) are similar to
those enumerated in section 93 of the Act in respect of the assessment of mergers,
such as the extent of foreign competition, barriers to entry into the market, and the
nature and extent of change and innovation in any relevant market. The Bureau will
consider each of the factors set out in subsection 90.1(2) and, where applicable, any
other factor relevant to competition in the market that is or would likely be affected
by the agreement.
3.5 — Defences and Exceptions

3.5.1 — Efficiency Exception
There are a number of different types of efficiency gains that may be realized
through competitor collaborations, such as reductions in fixed and variable costs
owing to rationalization of distribution, sales and advertising functions; improved
utilization of distribution and warehousing; increased specialization in distribution,
686
sales and marketing functions; more intensive use of a network infrastructure; and
improvements to product quality. Subsections 90.1(4) to (6) create a framework
where efficiency gains likely to be brought about by an agreement are considered
against the anti-competitive effects that are likely to result from the agreement.
The analysis conducted by the Bureau in respect of the efficiency exception in sub-
section 90.1(4) is consistent with the analysis undertaken by the Bureau in respect
of the efficiency exception applicable to mergers in section 96 of the Act.21 In both
cases, the burden is on the parties to the agreement to demonstrate, through credi-
ble, substantiated claims of efficiency gains, that the cost savings and other benefits
brought about by such efficiency gains are greater than and offset any anti-competi-
tive effects that are likely to result from the agreement.
To facilitate its review of efficiency claims, the Bureau requires detailed and com-
prehensive information that substantiates alleged efficiency gains. The information
should also address the likelihood that such gains will be achieved and why those
gains are not likely to be achieved if potential Tribunal orders, such as an order
prohibiting the agreement, are made. Wherever possible, efficiency claims should
be supported by documentation prepared in the ordinary course of business.
Notably, however, not all cost savings resulting from competitor collaborations will
be considered efficiency gains for the purpose of subsection 90.1(4). For example,
the Bureau will exclude savings resulting from a reduction in output, service, qual-
ity, or product choice. The Bureau will also exclude those gains that would likely
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be attained in any event through alternative means if potential Tribunal orders were
made. For example, if the Commissioner seeks to obtain an order prohibiting the
parties from implementing an agreement, the parties must demonstrate that the
claimed efficiencies would not likely be achieved if the order were made. In addi-
tion, the Bureau will exclude those gains that are merely redistributive (as provided
for in subsection 90.1(5) of the Act), such as cost savings anticipated to arise from
increased bargaining leverage that enables parties to extract discounts or other con-
cessions from suppliers.
The discussion regarding the nature of the Bureau’s analysis, types of efficiencies
generally included and excluded, and the assessment of anti-competitive effects of
the agreement found in Part 8 of the MEGs may also be instructive to parties in
preparing efficiency claims for the purpose of section 90.1.
3.5.2 — Federal Financial institutions

Subject to the exception found in subsection 90.1(9) for agreements in respect of
which the Minister of Finance has issued a certification, agreements between fed-
eral financial institutions that are likely to substantially lessen competition may be
subject to review under the civil agreements provision in section 90.1 of the Act.
Further, as noted above in section 2.6.2 of these Guidelines, an agreement between
21 Further details on the Bureau’s assessment of efficiencies in the context of merger review
can be found in the Bureau’s Bulletin on Efficiencies in Merger Review (2009), available
online at www.competitionbureau.gc.ca.
687
federal financial institutions that is described in subsection 49(1) of the Act may be
subject to criminal prosecution.
3.5.3 — Export Agreements

Subsection 90.1(8) of the Act contains a qualified or limited exception for agree-
ments between competitors that relate only to the export of products from Canada.
As with the exception found in subsection 45(5) of the Act, the exception for export
agreements is designed to enhance Canada’s export trade by facilitating export
agreements between competing firms.
In order for the export defence to apply, the agreement must relate only to the sup-
ply of products outside of Canada and not, for example, to the supply of products in
Canada. In addition, pursuant to subsection 90.1(8), the export defence will not
apply in the following circumstances:
(a) Where the agreement has resulted in or is likely to result in a reduction or
limitation of the real value of exports of a product;
(b) Where the agreement has restricted or is likely to restrict any person from
entering into or expanding the business of exporting products from Canada; or
(c) Where the agreement has prevented or lessened or is likely to prevent or
lessen competition substantially in the supply of services that facilitate the ex-
port of products from Canada.
Factors considered by the Bureau in assessing whether the export defence is appli-
cable are generally consistent with those examined in determining the applicability
of the export defence in subsection 45(5) to competitor agreements under the crimi-
nal provision (as described in section 2.6.3 of these Guidelines). However, pursuant
to paragraph 90.1(8)(c) of the Act, the defence is not applicable where the agree-
ment is likely to prevent or lessen competition in the supply of services that facili-
tate the export of products from Canada. In considering this issue, the Bureau will
assess whether the agreement has had, is having or is likely to have the effect of
substantially lessening or preventing competition in the supply of services that fa-
cilitate exports, such as customs brokerage, transportation and warehousing.
3.5.4 — Specialization Agreement

Pursuant to section 90, the Tribunal cannot issue a remedy under section 90.1 of the
Act in respect of specialization agreements that are registered under section 86 of
the Act.
3.5.5 — Agreements Between Affiliates

Section 90.1 does not apply to agreements entered into only by companies that are
affiliates. The definition of affiliated companies is set out in subsection 2(2) of the
Act and is reproduced in Section 5 of these Guidelines.
688
3.6 — Commercialization and Joint Selling Agreements

Commercialization agreements typically define the actions to be undertaken by par-
ticipants in order to develop new products or enter new markets. Certain forms of
commercialization arrangements can generate cost savings and other efficiencies
for participants, including reduced distribution costs by sharing a common ware-
house, distribution facility or sales agent. However, these agreements can also im-
pair competition between participants, such as where the agreement substantially
restricts competition in product choice, service or other significant competitive
variables.
The Bureau will consider a number of factors when assessing commercialization
agreements, including the following: whether the agreement is between competi-
tors; whether the parties to the agreement hold market power; whether the agree-
ment deals with competitively significant terms of trade, such as price; whether the
parties are able to commercialize products outside the scope of the agreement or
otherwise retain the ability to compete independently; whether the commercializa-
tion agreement requires or provides opportunities for the disclosure of competi-
tively sensitive information between the participants; and whether any anti-compet-
itive effects are offset and outweighed by the efficiencies generated through the
commercialization agreement. Each of these factors is discussed in turn below, with
the exception of market power and efficiencies, which are discussed above in sec-
tions 3.4 and 3.5.1 of these Guidelines, respectively.
Guidelines
Joint selling agreements involve agreements between participants with respect to
certain aspects of their sales activities, such as, for example, using a common sales
agent. Where joint selling agreements are, in substance, simply agreements to re-
strain competition between the parties (including, for example, price-fixing agree-
ments), the Bureau will generally assess these agreements under the criminal provi-
sion in section 45 of the Act. Joint selling agreements that address other aspects of
the relationship between the participants will generally be assessed in a manner
similar to commercialization agreements, as discussed in greater detail below.
3.6.1 — Agreement Between Competitors

Section 90.1 is confined to agreements between competitors and potential competi-
tors. If the parties are not competitors or potential competitors in respect of prod-
ucts that are subject to the commercialization or joint selling arrangement, then
section 90.1 is not applicable. However, a commercialization or joint selling agree-
ment may also be reviewed under other provisions of the Act. For example, if a
commercialization agreement contains vertical restraints, such as restrictions on re-
sale prices or requirements that products be distributed only within certain markets,
then the agreement may be subject to review under sections 76 (price maintenance),
77 (market restriction) or other reviewable provisions found in Part VIII of the Act.
3.6.2 — Competitively Significant Terms

Commercialization and joint selling arrangements may cover a broad range of
sales, distribution and marketing activities, or may be confined to a single aspect,
such as advertising. The Bureau will consider the terms of the commercialization
689
agreement and/or joint selling agreement in determining whether the agreement is

likely to prevent or lessen competition substantially. Concerns are most likely to
arise where the commercialization agreement and/or joint selling agreement re-
stricts competition on key aspects of competitive rivalry between the participants.
Identification of the key aspects of competitive rivalry will depend upon the cir-
cumstances relevant to each agreement. For example, commercialization agree-
ments that prevent participants from competing on price are more likely to raise
concerns than arrangements that are limited to sharing a common warehouse or
distribution network. Where rivalry between the parties is focused on non-price as-
pects, such as level of service or delivery terms, a commercialization agreement
that restricts competition on these aspects may still raise concerns under the Act.
The Bureau will also consider other terms of the commercialization agreement
and/or joint selling agreement, such as the duration of the collaboration. In general,
the shorter the duration of the collaboration, the less likely it is that the collabora-
tion will raise issues under the Act.
The Bureau will consider the impact that the agreement has had or is likely to have
on competition. For example, where a proposed agreement requires that sales of the
relevant product be made through a common sales agent, the Bureau will consider
whether the arrangement is likely to: significantly reduce price competition; reduce
competition on other terms of trade; impair the incentive or ability of the parties to
engage in aggressive marketing strategies; lead to the apportioning of markets or
customers; and result in other potential anti-competitive effects.
3.6.3 — Ability to Sell outside of Agreement and independent Competition

The Bureau will also consider whether the agreement restricts the ability of the
parties to exercise independent discretion in respect of the key conditions of com-
petitive rivalry — for example, whether competitors who agree to supply products
through a common distribution network or sales agent will continue to indepen-
dently determine prices and other terms of trade, or whether the agreement requires
or induces these competitors to adopt common prices and terms of trade.
Similarly, the Bureau will consider whether the parties to the agreement are permit-
ted to engage in the supply of the relevant product outside of the agreement. For
example, when examining a joint selling or distribution agreement, the Bureau will
consider whether the agreement allows the parties to sell all or some of the relevant
product independently or whether the agreement requires the parties to supply the
relevant product only through common distribution or a common sales agent.
The Bureau will also examine whether the collaboration is organized and governed
in a manner that permits the collaboration to compete independently from its par-
ticipants. For example, the Bureau will consider whether the collaboration has the
ability and incentive to act as an independent decision-maker or whether the par-
ticipants retain control over the collaboration’s decisions regarding price, market-
ing strategies or other competitively significant terms. Factors that are relevant to
this determination include whether the collaboration is separately incorporated,
whether participants are entitled to appoint representatives to the board of directors
of the collaboration, whether the collaboration has independent senior management,
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whether competitively significant decisions of the collaboration are subject to ap-

proval of the members, and whether participants are otherwise able to exert signifi-
cant control over the operations of the collaboration. A collaboration is not consid-
ered to be anti-competitive merely because it does not have the ability or incentive
to compete independently of its participants. Rather, this is one factor in the overall
assessment of the collaboration.
3.6.4 — Disclosure of Competitively Sensitive information

The Bureau will consider whether a commercialization agreement and/or joint sell-
ing agreement provides an opportunity for the disclosure or exchange of competi-
tively sensitive information, such as information regarding costs, prices to be
charged and marketing strategies. The Bureau will consider opportunities for the
sharing of information directly between participants, as well as opportunities for
indirect exchanges, such as through a common agent. Parties are encouraged to
include in the terms of the agreement appropriate safeguards against the disclosure
of competitively sensitive information. For further discussion of these issues,
please see section 3.7 of these Guidelines regarding information sharing between
competitors.
3.7 — Information Sharing Agreements

Collaborations can involve a considerable degree of information exchange between
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competitors. Similarly, trade associations may gather information from industry
participants to further the objectives of the association, perform benchmarking ex-
ercises or otherwise benefit members. For the most part, such exchanges do not
raise concerns under the Act because competitors generally avoid sharing informa-
tion that is competitively sensitive in order to preserve their competitive advantage.
In certain cases, an agreement that involves a unilateral disclosure or exchange of
information between competitors can impair competition by reducing uncertainties
regarding competitors’ strategies and diminishing each firm’s commercial
independence.
Cartel agreements often involve the exchange of competitively sensitive informa-
tion between competitors. Indeed, activities that assist competitors in monitoring
one another’s prices or conduct otherwise consistent with the existence of an agree-
ment may be sufficient to prove that an agreement was concluded between the par-
ties for the purpose of subsection 45(1) of the Act.22 Accordingly, information
sharing agreements between competitors should be structured carefully to ensure
that they do not raise concerns under the criminal prohibitions in subsection 45(1)
of the Act.
In assessing information sharing agreements between competitors under section
90.1, the Bureau will consider the following factors, among others: the nature of
the information exchanged (i.e., whether the information is competitively sensi-
tive); the timing of the information exchange (e.g., whether the information relates
22 Please refer to the discussion above in Section 2 of these Guidelines.
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to historical, current or future activities); whether the parties participating in the

information exchange have market power or will likely have market power; the
manner in which the information is collected and disseminated (e.g., whether the
information is shared directly between competitors or aggregated by a third party);
and whether any anti-competitive effects are offset and outweighed by the efficien-
cies generated through the information sharing agreement. Each of these factors is
discussed in turn below, with the exception of efficiencies, which is discussed
above in section 3.5.1 of these Guidelines.
3.7.1 — Competitively Sensitive information

An agreement to disclose or exchange information that is important to competitive
rivalry between the parties can result in a substantial lessening or prevention of
competition. For example, exchanging pricing information, costs, trading terms,
strategic plans, marketing strategies or other significant competitive variables can
raise concerns under the Act. Where competitors agree to share competitively sen-
sitive information, it can become easier for these firms to act in concert, thereby
reducing or even eliminating competitive rivalry.
In general, the Bureau does not consider publicly available information to be com-
petitively sensitive. However, the Bureau may be concerned with an agreement be-
tween competitors to publicly disclose competitively sensitive information. For ex-
ample, an agreement to publicly disclose future pricing information can raise
concerns under the Act where it is likely to have the effect of substantially lessen-
ing competition and where such disclosure is not in furtherance of some legitimate
objective.
3.7.2 — Timing of information

The exchange of information relating to current or future activities is more likely to
affect competition adversely and, as such, raises greater concerns than the exchange
of information relating to historical activities. For example, disclosure of informa-
tion relating to future pricing, future marketing activities or the disclosure of other
competitively sensitive information is more likely to raise concerns than disclosure
of information regarding activities that took place in the past, such as historical
costs or sales. However, it should be noted that an agreement to disclose historical
information could raise concerns where such information provides a meaningful
indication of future intended pricing or other competitively significant factors.
3.7.3 — Market Power

As noted above, an agreement is likely to substantially lessen or prevent competi-
tion in a relevant market where the agreement is likely to create, maintain or en-
hance the ability of the parties to the agreement to exercise market power. As a
result, the Bureau will not challenge under section 90.1 an agreement to share in-
formation unless the parties to the agreement have or are likely to have market
power or the relevant market is concentrated such that firms are able to engage in a
coordinated exercise of market power. Agreements to share information between
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participants who collectively hold market power have the potential to substantially
lessen competition in the relevant market.
3.7.4 — Manner of Collection and Dissemination

Information exchanged directly between competitors is more likely to raise con-
cerns than information that is supplied to an independent third party. In addition,
information that is aggregated so as not to disclose information specific to any
given firm is less likely to raise concerns than information that is shared in a disag-
gregated form. For example, firms wishing to determine costs relative to industry
averages or industry trends may agree to supply current sales information to a third
party for disclosure in an aggregated form that does not reveal the sales information
of any specific firm, as distinct from sharing that information directly.
In evaluating an agreement to exchange information, the Bureau will also consider
the safeguards established through the organization and governance of the collabo-
ration that are directed at preventing or minimizing the disclosure of competitively
sensitive information. For example, participants in the collaboration can limit dis-
closure of information to personnel who are not engaged in sales or marketing ac-
tivities, or can prevent sales and marketing personnel from participating in a re-
search and development joint venture.
3.8 — Research and Development Agreements
Guidelines
Cooperation in respect of research and development (“R&D”) activities may result
in significant benefits. For example, R&D collaborations can allow firms to com-
bine complementary technologies and resources, leading to the development of new
and improved products. R&D collaborations can also allow firms to lower the costs
of research, accelerate the pace of innovation, and reduce the time required to bring
new products to market.
In certain circumstances, R&D agreements can substantially lessen or prevent com-
petition, such as where restrictions are imposed on the exploitation of products de-
veloped through the collaboration.
The central issue that will be considered by the Bureau is whether the R&D agree-
ment substantially lessens or prevents competition, either in respect of a product or
innovation. For example, the Bureau may have concerns where the R&D agreement
reduces the level of innovation that would prevail in the absence of the agreement
(such as where consumers will have fewer product choices), or where the time re-
quired to bring products to market is greater. Restrictions on competition can also
reduce the number of independent competitors for the products that are the subject
of R&D agreements or otherwise lessen competition.
In assessing R&D agreements, the Bureau generally considers the following fac-
tors: whether the agreement is between competitors; whether the agreement is lim-
ited to R&D or also contains provisions regarding the joint exploitation of prod-
ucts; whether the parties hold market power in the relevant market; whether the
restrictions on competition are reasonably necessary for achieving the objective of
the R&D agreement; and whether any anti-competitive effects are offset and out-
693
weighed by the efficiencies generated through the R&D agreement. Each of these
factors is discussed in turn below, with the exception of efficiencies, which is dis-
cussed above in section 3.5.1 of these Guidelines.

Section 90.1 only applies to R&D agreements between parties at least two of which
are competitors or potential competitors in respect of a product that is subject to the
agreement.
The Bureau will consider whether the parties are able to develop the product inde-
pendent from the collaboration. As noted above, if the parties are unable to develop
the product independent of the agreement, the parties are not considered to be com-
petitors for the purpose of section 90.1 of the Act. Where the parties are able to
develop the product independently, albeit at a higher cost or during a longer period
of time than through a collaborative effort, this does not necessarily mean that the
agreement will be challenged, but that further consideration of other factors, such
as those listed below, is necessary to determine whether concerns exist under sec-
tion 90.1.
3.8.2 — Whether Agreement Deals with Joint Exploitation

The Bureau will consider whether the agreement includes provisions relating to the
joint exploitation of the results of the R&D. Agreements that relate only to R&D
and do not include provisions regarding the joint exploitation of the possible results
generally raise concerns under the Act only in the following circumstances: (i)
where the agreement involves the disclosure of competitively sensitive information
that is not necessary for the purpose of carrying out the R&D activities; (ii) where
the agreement imposes unnecessary restrictions on innovation that would likely be
carried out in the absence of the agreement; or (iii) where the agreement would
substantially lessen competition because the parties would otherwise be likely to
independently develop competing products. For example, issues may arise in re-
spect of an agreement regarding R&D where the agreement restricts participants
from engaging in R&D in respect of unrelated products. Where the agreement in-
cludes provisions regarding joint exploitation or meets the conditions in one or
more of (i), (ii) or (iii) above, the Bureau will undertake additional analysis in ac-
cordance with the discussion that follows below. This does not mean that the col-
laboration will necessarily be challenged, but only that further review is required to
determine if the collaboration raises concerns under section 90.1 of the Act.

Where the research and development agreement includes provisions relating to the
joint exploitation of products, the Bureau then examines whether the parties to the
agreement hold or are likely to hold market power. The parties to a research and
development agreement will not have the ability to substantially lessen or prevent
competition in any relevant market unless they hold or are likely to hold market
power.
694
The determination of whether the parties to an R&D agreement hold market power
may be straightforward or complex, depending upon the nature of the products and
the stage of development. For example, where the R&D agreement relates only to
improvements on existing products, then the relevant market will likely consist of
the existing products and products that are competitive substitutes. However, it may
be more challenging to determine whether participants in an R&D agreement hold
market power in circumstances where the collaboration concerns the development
of entirely new products. Where possible, in determining whether the parties are
likely to hold market power in respect of a product under development, the Bureau
will account for competitive substitutes that exist in the market and those that are
under development by the participants and third parties.
3.8.4 — Whether Restrictions Are Reasonably necessary

In assessing whether an R&D agreement is likely to substantially lessen or prevent
competition for the purpose of section 90.1 of the Act, the Bureau will also con-
sider whether any restraints on competition are reasonably necessary to attain the
benefits of the R&D agreement. Although the Bureau will consider each agreement
in the particular circumstances, the Bureau does not generally consider that restric-
tions on the level of output or restraints that restrict the ability or incentive of the
participants to conduct R&D in respect of products or fields that are outside of the
R&D agreement are reasonably necessary. The Bureau will also examine whether
Guidelines
any restraints on competition are imposed for a period of time that extends beyond
that which is reasonably necessary to achieve the objectives of the R&D agreement.
3.9 — Joint Production Agreements

Joint production agreements take numerous different forms, including: specializa-
tion agreements where parties unilaterally or reciprocally agree to discontinue pro-
duction of a product and instead purchase that product from another party; agree-
ments where parties produce products through common production facilities or a
jointly controlled company; and subcontracting arrangements where one party re-
tains another to produce products on its behalf.
Joint production agreements may generate cost savings through various means,
such as economies of scale or scope, sharing a better production process, and com-
bining complementary technologies and know-how. Accordingly, joint production
agreements can be pro-competitive and, in some cases, may provide a means for
launching a new product, entering a new market or carrying out a specific project.
However, joint production agreements can also have anti-competitive effects, such
as where the agreement leads to significant reduction or elimination of competition
in respect of the supply of a relevant product, where the agreement results in a
significant reduction of output of the relevant product or where the agreement low-
ers the price of an input below competitive levels. As noted above, section 90.1 of
the Act does not apply in respect of specialization agreements that are registered
under section 86 of the Act.
In assessing a joint production agreement, the Bureau considers a number of fac-
tors, including: whether the joint production agreement is between parties that are
695
actual or potential competitors; whether the joint production agreement contains

provisions that limit output of a relevant product, fix prices or otherwise restrict
competition on competitively significant matters; whether the joint production
agreement otherwise reduces the incentive or ability of the parties to compete inde-
pendently; whether the parties to the agreement have market power or will likely
have market power (either in the upstream or downstream markets); and whether
any anti-competitive effects are offset and outweighed by the efficiencies generated
through the joint production agreement. Each of these factors is discussed in turn
below, with the exception of efficiencies, which is discussed above in section 3.5.1
of these Guidelines.

The primary concern with a joint production agreement is that the agreement can
result in the elimination or reduction of rivalry between suppliers who are actual or
potential competitors. In considering this issue, the Bureau will examine competi-
tion in both the relevant market for the products that are produced through the joint
production agreement (the “downstream market”) as well as the relevant market for
the purchase of inputs into the joint production process (the “upstream market”).
Joint production agreements may substantially lessen competition and fall within
the scope of section 90.1 where the parties are competitors or potential competitors
in respect of at least one product in the downstream market (such as where the
parties compete with respect to the product that is being jointly produced) or up-
stream market (such as where the parties compete with respect to the purchase of
an input).
3.9.2 — Restraints on Competition

The Bureau will consider whether the joint production arrangement imposes re-
straints on competition in the downstream market. The Bureau may have concerns
where an agreement includes restraints in the nature of, for example, restrictions on
the quantities of products that may be produced or supplied into a market, agree-
ment on the price to be charged for products, allocation of customers, elimination
of promotional strategies or agreement on other competitively significant aspects of
the parties’ respective operations. Overall, the Bureau’s analysis focuses on
whether the joint production agreement will reduce the ability or incentive of the
parties to compete independently and, as discussed below, whether this will result
in a substantial lessening or prevention of competition in the relevant market.
3.9.3 — Reduced incentive or Ability to Compete independently

The Bureau will consider whether a joint production agreement is likely to reduce
the incentive or ability of the participants to compete independently in respect of
the supply of products. For example, the Bureau will consider whether the joint
production agreement will result in a substantial degree of commonality of costs
between the participants such that the scope for price competition between the par-
ties is substantially restricted. For such a concern to arise, among other things, the
joint production process governed by the agreement must represent a substantial
696
portion of the total production costs of the relevant product. Similar concerns may
arise where the joint production agreement relates to the use of key production fa-
cilities of the parties, thereby reducing the individual participants’ capacity or con-
trol over assets necessary to compete independently.

The parties to a joint production agreement will not have the ability to substantially
lessen or prevent competition in any relevant market unless they hold or will hold
market power. To determine whether the parties collectively hold market power,
the Bureau will examine competition in both the relevant market for the products
that are the subject of the joint production agreement (the “downstream market”) as
well as the relevant market for the purchase of inputs into the joint production pro-
cess (the “upstream market”).
Where the joint production agreement relates to an intermediate good, which is an
input into the final product supplied by the parties (such as where competing auto-
mobile manufacturers enter into a joint production agreement for the manufacture
of transmissions for use in their automobiles), the Bureau will consider whether the
joint production agreement is likely to substantially lessen or prevent competition
in respect of the supply of the final product. The Bureau generally will not have
concerns with a joint production agreement relating to an intermediate product
where the intermediate product does not represent a significant proportion of the
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total costs of the final product or where the parties do not have market power or are
not likely to have market power in the downstream market for the final product.
Through a joint production agreement, participants can combine their acquisition of
input products and substantially lessen or prevent competition in respect of the
purchase of the input. The Bureau’s approach to examining joint purchasing ar-
rangements is described below in section 3.10 of these Guidelines.
3.10 — Joint Purchasing Agreements and Buying Groups

A joint purchasing arrangement is an agreement between firms to purchase all or
some of their requirements for a product from one or more suppliers. Such arrange-
ments are often pro-competitive, as they permit firms to combine their purchases to
achieve greater discounts from suppliers, and share delivery and distribution costs.
However, joint purchasing agreements are agreements between parties that may be
competitors in respect of the purchase of the products subject to the agreement.
Accordingly, joint purchasing arrangements can substantially lessen or prevent
competition where, for example, purchasers agree to fix the price at which products
will be purchased as an exercise of monopsony power.
Joint purchasing arrangements can take several forms, including agreements to
purchase products through a jointly controlled company, contractual arrangements
between a group of firms and a supplier and buying groups. As noted earlier in
these Guidelines, the existence of a written agreement between the parties clearly
defining the terms of the joint purchasing arrangement may assist the Bureau in
understanding the terms of the agreement and the objectives underlying the
agreement.
697
In considering whether an agreement is likely to substantially lessen or prevent

competition, the Bureau will consider the likely impact of the agreement on compe-
tition in the relevant purchasing market (the “upstream” market). The Bureau’s ap-
proach to the assessment of the potential competitive effects of joint purchasing
agreements in the upstream market is discussed below.
3.10.1 — Defining Relevant Purchasing or Upstream Market

The assessment of whether a joint purchasing agreement will likely substantially
lessen or prevent competition in a relevant upstream market depends upon whether
the agreement will create, preserve or enhance the monopsony or oligopsony power
of the participants. For the purpose of section 90.1, the Bureau considers a single
buyer to have “monopsony power” where the buyer holds market power in the rele-
vant purchasing market such that it has the ability to decrease the price of a relevant
product below competitive levels with a corresponding reduction in the overall
quantity of the input produced or supplied in a relevant market, or a corresponding
diminishment in any other dimension of competition.23 Oligopsony power occurs
where market power in the relevant purchasing market is exercised by a coordi-
nated group of buyers. For greater clarity, in these Guidelines, the Bureau uses the
term monopsony power to include oligopsony power.
The Bureau considers whether monopsony power exists in the context of a relevant
purchasing market. The process for defining the relevant purchasing market follows
the same general approach for defining a relevant market, with the exception that
the concept of substitutability is defined from the perspective of the supplier and is
not based on demand by the buyer. The Bureau applies a hypothetical monopsonist
test under which a relevant market is defined as the smallest group of products and
the smallest geographic areas in which a sole, profit-maximizing buyer (the “hypo-
thetical monopsonist”) would impose and sustain a significant and non-transitory
price decrease below levels that would exist in the absence of the joint purchasing
agreement. Therefore, the question applicable to defining the relevant market is
whether the suppliers of an input, in response to a decrease in the price of the input,
would be able to profitably switch to alternative buyers or modify an input they sell
in sufficient quantity to render the input price decrease unprofitable to the buyer.
For example, if corn suppliers could discipline a price decrease for corn by switch-
ing to canola production, this would imply that, for the purpose of assessing the
likelihood of monopsony power, corn and canola are in the same product market. In
determining this issue, the Bureau will consider whether, given the time and money
required by sellers to switch to the production of other products, such alternatives
provide an effective, sufficient and timely discipline on a price decrease of the rele-
vant input.
23 Cases where the supply curve is perfectly inelastic such that a price decrease below com-
petitive levels does not result in a decrease in output but only a wealth transfer may also give
rise to concerns. This scenario should be understood to be generally included in the category
of upstream market power.
698
3.10.2 — Monopsony Power

Once the relevant market is defined, the Bureau will consider whether the partici-
pants in the joint purchasing agreement have, or are likely to have, monopsony
power with respect to a relevant product that is subject to the agreement. In general,
for concerns to arise with respect to the likely competitive impact of a joint produc-
tion agreement on the upstream market, the parties must hold market power in the
market for the purchase of the relevant input and the joint production agreement
must be likely to reduce prices below the competitive level such that there is a
corresponding reduction in the input supplied or a corresponding diminishment in
any other dimension of competition.
Buyers currently buying the input in question will generally be considered partici-
pants in the relevant market. Buyers not currently buying the input may be consid-
ered participants in the relevant market provided that, in the event of a small but
significant input price decrease, the buyer would buy the input and the seller would
sell it. It should also be noted that buyers that do not participate in the same down-
stream market in which the parties to the joint purchasing agreement participate
might still be considered to be buyers in the relevant purchasing market. For exam-
ple, a grocery store likely participates in a local market for the sale of groceries, but
it may purchase a food input, such as corn, from a producer that may have regional,
national and even international buyers for the sale of its product, including not only
grocery stores, but also industrial purchasers.
Guidelines
Once the buyers are identified, the size of the purchases of the relevant input prod-
uct by the participants to the joint purchasing agreement are compared with the
total sales of the input in the relevant market. If the parties to the agreement re-
present only a small percentage of the suppliers’ sales of the input product in the
relevant market, these suppliers are generally considered to be well-placed to
forego sales to the parties in favour of other buyers when faced with an attempt to
lower input prices. As a general rule, the Bureau will not challenge joint purchasing
agreements under section 90.1 on the basis of a concern related to the exercise of
monopsony power by the parties where the share of the relevant upstream market
held by the parties to the agreement is less than 35%. Further, the Bureau will
generally not challenge an agreement on the basis of oligopsony power where: (i)
the share of the four largest firms in the relevant upstream market is less than 65%;
or (ii) the share of the parties to the agreement is less than 10% of the relevant
upstream market.
Where the parties to the joint purchasing agreement account for a significant por-
tion of the input purchases, the Bureau will consider whether barriers to entry into
buying the relevant input are high. Where the participants in a joint purchasing
agreement represent a significant portion of the input purchases and barriers to en-
try into the purchasing market are high, the Bureau will likely conclude that the
participants hold buying power (the ability to depress prices), and the Bureau will
engage in further analysis to determine whether the participants are likely to hold
and exercise monopsony power.
699
3.10.3 — Likelihood of Exercise of Monopsony Power

Where it is established that the parties to the agreement hold monopsony power, the
Bureau will examine a number of factors in determining whether the participants
are likely to exercise monopsony power, including: (i) whether supply is highly
elastic; (ii) whether the upstream supply of the input is characterized by a large
number of sellers and low barriers to entry such that the normal selling price of a
supplier is likely competitive; and (iii) whether it seems likely that certain suppliers
will exit the market in response to the anticipated price decrease or will scale back
production. The Bureau will also consider whether the exercise of monopsony
power will jeopardize a long-run source of supply and the possible costs to the
parties of decreased output in the downstream market that may follow decreased
input purchases. As a general rule, the Bureau is not concerned with joint purchas-
ing agreements that result only in lower prices for inputs, provided that such lower
prices do not constitute an exercise of monopsony power, as discussed above.
3.11 — Non-Compete Clauses

Non-competition clauses are common in a number of different types of agreements
and can serve legitimate purposes, such as ensuring that a purchaser realizes the
full value of a purchased business by not being required to compete against the
vendor for customer loyalty. Non-compete clauses that are entered into in connec-
tion with a merger (as that term is defined in section 91) are examined as part of the
assessment of the transaction under section 92 of the Act.
When examining a non-compete clause or agreement under section 90.1 of the Act,
the Bureau will consider whether, as a result of the non-compete, the agreement
substantially lessens or prevents competition in any relevant market. In the context
of this determination, the Bureau considers whether the non-compete is reasonably
necessary for the implementation or continuation of the collaboration. To determine
this issue, the Bureau will have regard to the geographic scope of the non-compete,
the duration of the non-compete, the parties subject to the non-compete and the
products subject to the non-compete.
4. — Hypothetical Illustrative Examples

The following examples are designed to illustrate the analytical framework that
would be applied by the Bureau in conducting its review of a particular agreement.
Not all of the agreements listed below raise issues that warrant review by the
Bureau.
Example 1 — Price-Fixing Agreement

X and Y are firms that compete in respect of the supply of gadgets in Canada.
These two firms are relatively new entrants in the market with little prior experi-
ence in instituting effective sales and marketing strategies. X and Y have each
priced gadgets for sale at varying price points in recent years, but have had little
success in capturing a greater share of the market. As demand for gadgets has de-
clined, X and Y have seen a corresponding decline in their profits. X and Y meet
and agree to eliminate discounts on all gadgets they sell.
700
Analysis
Subsection 45(8) of the Act defines the term “price” for the purpose of subsection
45(1) to include “any discount, rebate, allowance, price concession or other advan-
tage in relation to the supply of a product”. As a result, an agreement to eliminate
or reduce discounts constitutes an agreement to fix prices. Accordingly, this agree-
ment between competitors would be examined under subsection 45(1) of the Act.
An ancillary restraints defence is not applicable because there is no evidence to
suggest that the restraint on competition agreed upon by X and Y was reasonably
necessary to promote or facilitate the objective of some broader agreement. In this
regard, the companies’ desire to capture additional market share is not a broader
agreement in respect of which price-fixing is an element. Rather, the price-fixing
agreement entered into between X and Y has no objective other than restraining
competition between the parties. As a result, this agreement would likely raise con-
cerns under section 45 of the Act.
Example 2 — Market Allocation Agreement Between Potential

Competitors
X is an established supplier of widgets throughout Western Canada. X has enjoyed
significant profits in recent years after recognizing that the widget market in West-
ern Canada was under-supplied and moving quickly to meet demand with its prod-
uct. X is now interested in building upon its recent successes by supplying widgets
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into Eastern Canada, where Y is the largest widget supplier. Y supplies widgets
only in Eastern Canada, but is considering expanding its operations into Western
Canada. X and Y meet to discuss trends in the widget industry and, at this meeting,
learn of each other’s expansion plans. In order to maintain the profitability of their
respective operations, X and Y agree that X will confine its sales of widgets to
Western Canada and Y will confine its sales of widgets to Eastern Canada. When
questioned about the agreement, the Parties argue, among other things, that the re-
striction is an ancillary restraint.
Analysis
Subsection 45(8) of the Act defines a “competitor” to include a person who it is
reasonable to believe would be likely to compete with respect to a product24 in the
absence of an agreement. Although X and Y were not competitors at the time of the
agreement, the Bureau would consider whether either or both of X and Y would be
likely to compete in respect of the supply of widgets in the other’s sales territory in
the absence of the agreement. In particular, given evidence as to each firm’s plans
and ability to expand across the country, the Bureau would conclude that X and Y
are potential competitors, and this agreement would likely raise concerns under
subsection 45(1) of the Act because it is an agreement between potential competi-
tors to allocate sales, territories, customers or markets for the supply of a product.
24 The term “product” should be understood to include the plural, as well as differentiated
products that compete.
701
While this restraint may contravene subsection 45(1) of the Act, the Bureau would
consider the parties’ argument that it is, in fact, an ancillary restraint. In consider-
ing the defence under subsection 45(4) of the Act, the Bureau will examine
whether: (i) the restraint is ancillary to a broader or separate agreement that in-
cludes the same parties; (ii) the restraint is directly related to, and reasonably neces-
sary for giving effect to, the objective of the broader or separate agreement; and
(iii) the broader or separate agreement, when considered in the absence of the re-
straint, does not contravene subsection 45(1). On the facts, there is no evidence to
suggest that the restraint is ancillary to a broader agreement between the two par-
ties. Accordingly, it is unlikely that the ancillary restraints defence would be appli-
cable to the parties’ agreement.
Example 3 — Output Restriction Agreement

X and Y compete with one another in the production of gizmos. Each company
operates four plants in various locations across Canada. As a result of declining
demand, there is now significant excess capacity for the production of gizmos. X
and Y meet and agree to reduce production capacity in the industry, so as to stabi-
lize prices. Soon after the meeting, each company shuts down a plant.
Analysis
Agreements are not subject to exceptions from the provisions of the Act simply as a
result of depressed economic conditions. In this example, the agreement would
likely raise concerns under subsection 45(1) of the Act because it is an agreement
between competitors to fix, lessen or eliminate the production of a product.
Example 4 — Dual-Distribution Agreement

X is a Canadian widget manufacturer that sells widgets to distributors and to retail-
ers. Y, an independent distributor, approaches X to inquire about the possibility of
distributing X’s widgets. Y has no manufacturing facilities and is otherwise unable
to manufacture widgets on its own. X enters into a distribution agreement with Y
whereby they agree on the price at which X will supply widgets to Y. The agree-
ment also requires that Y distribute only X’s widgets and only to retailers in On-
tario. X will continue to sell its widgets to distributors and retailers in Ontario and
throughout the rest of Canada.
Analysis
As indicated in section 2.3.3 of these Guidelines, the Bureau will assess dual-distri-
bution agreements between suppliers and distributors under the civil provisions
found in Part VIII of the Act, and not under the criminal provision in subsection
45(1) of the Act. As such, in the event that the Bureau assesses this arrangement, it
would examine the arrangement under, for example, section 77 of the Act. Notably,
the agreement between X and Y to establish the price at which X supplies widgets
to Y is not considered by the Bureau to be an agreement to fix prices.
702
Example 5 — Agreements Involving Franchises

(a) — Non-Criminal
A franchisor’s agreements with each of its franchisees provide that the franchisees
will not supply products to customers outside of their respective assigned territo-
ries. The parties to these agreements assert that these restraints are necessary so as
to ensure that each franchisee is provided with a sufficient sales territory to support
the overall viability of the franchise and to effectively promote their products.
Analysis
As described in section 2.3.3 of these Guidelines, the Bureau does not consider a
restriction in a franchise agreement that requires franchisees to supply products
only in a defined territory to be an agreement among competitors. Accordingly, the
agreement would not be examined under subsection 45(1) or section 90.1, but it
may be assessed under another civil provision under Part VIII of the Act, such as
section 77 (market restriction).
(b) — Criminal
Franchisor X has entered into agreements to grant franchises to three franchisees,
B, C and D, all of which supply products in the same region and share the same
customer base. The franchisees are concerned about price competition between
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themselves. Franchisees B, C, and D enter into an agreement to fix prices for their
products.
Analysis
As discussed in section 2.3.3 of these Guidelines, the Bureau will generally assess
agreements between franchisors and franchisees that allocate markets or customers
for the operations of the franchisee — such as where the franchise agreement pro-
vides franchisees with an authorized sales territory — under the civil provisions
found in Part VIII of the Act, and not under the criminal conspiracy provision in
subsection 45(1) of the Act. However, the mere existence of a franchisor-franchisee
relationship between two parties does not foreclose the possibility that agreements
between these parties to fix prices, allocate markets or restrict output with respect
to products that are outside of the franchise arrangement may be subject to section
45.
In addition, where an agreements is, in fact, an agreement between franchisees to
restrain competition among themselves, such as by allocating markets or fixing
prices, such agreements will be reviewed under subsection 45(1) of the Act. In the
present example, the agreement between B, C and D would likely raise concerns
under subsection 45(1), as it constitutes an agreement between competitors to fix
prices for the supply of products in respect of which they compete.
703
Example 6 — Joint Selling Agreement

(a) — non-Criminal
X and Y compete with one another in the supply of widgets. Currently, each of X
and Y use their own distributors and warehouses to supply widgets to retailers,
sending shipments by separate trucks from separate warehouses on a weekly basis.
X and Y enter into an agreement whereby they will employ a common distributor, a
common warehouse and common distribution facilities, allowing the parties to de-
liver widgets to retailers in joint shipments each week. X and Y continue to inde-
pendently determine prices for their products and remain free to supply products
through other distributors. X and Y also agree that the common distributor will not
disclose to a party any pricing, marketing or other competitively sensitive informa-
tion supplied by the other party. The joint venture does not involve the acquisition
by X or Y of a significant interest in the other party’s business so as to be consid-
ered a merger under the Act.
Analysis
The agreement in this example is clearly an agreement between competitors. How-
ever, it would be examined under section 90.1 of the Act, and not subsection 45(1),
as it does not constitute an agreement between competitors to fix prices, allocate
markets or reduce output.
In assessing the agreement under section 90.1, the Bureau would consider a number
of factors, including whether the parties to the agreement hold market power;
whether the agreement deals with competitively significant terms of trade; whether
the parties are able to supply products outside the scope of the agreement or other-
wise retain the ability to compete independently; whether the agreement requires or
provides opportunities for the disclosure of competitively sensitive information be-
tween the participants; and whether any anti-competitive effects are offset and out-
weighed by the efficiencies generated through the agreement.
In the present example, the Bureau would be unlikely to challenge the agreement
on the basis that the agreement does not deal with competitively significant terms
of trade or restrict the ability of the parties to supply products outside of the agree-
ment, and the agreement incorporates measures directed at preventing the disclo-
sure of competitively sensitive information. To the extent that the Bureau deter-
mined that the agreement was likely to result in a substantial lessening or
prevention of competition, the Bureau would also consider all available evidence as
to whether any anti-competitive effects would be offset and outweighed by effi-
ciency gains that would be likely to result from the agreement, before determining
whether to challenge the agreement under section 90.1 of the Act.
(b) — Criminal
X and Y compete with one another in the supply of widgets, but they also are
interested in developing an unrelated product called a gizmo. X and Y enter into a
joint venture agreement with respect to the development of gizmos. The agreement
also specifies that the parties will set a common price for the supply of widgets,
704
which the parties argue is directly related to and reasonably necessary for giving
effect to the joint venture. The joint venture does not involve the acquisition by X
or Y of a significant interest in the other party’s business so as to be considered a
merger under the Act.
Analysis
The joint venture agreement includes a restraint that fixes the prices of widgets
supplied by the parties. While this restraint may contravene subsection 45(1) of the
Act, the Bureau would nonetheless consider the applicability of the ancillary re-
straints defence.
In considering this defence under subsection 45(4) of the Act, the Bureau will ex-
amine whether: (i) the restraint is ancillary to a broader or separate agreement that
includes the same parties; (ii) the restraint is directly related to, and reasonably
necessary for giving effect to, the objective of the broader or separate agreement;
and (iii) the broader or separate agreement, when considered in the absence of the
restraint, does not contravene subsection 45(1). Of particular relevance is whether
the restraint on competition agreed to by the parties is directly related to and rea-
sonably necessary for giving effect to the joint venture agreement. On the facts,
there is no evidence to establish that fixing a price for the supply of widgets is
either directly related to or reasonably necessary for giving effect to the broader
joint venture agreement, which is focused on the development of gizmos. Further,
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as noted in section 2.5.3 of the Guidelines, for a restraint to be directly related, it is
not adequate merely to establish that the participants would not enter into the
broader agreement in the absence of the challenged restraint.
Accordingly, it is unlikely that the ancillary restraints defence would apply to the
parties’ price-fixing agreement, and the agreement would likely raise concerns
under subsection 45(1) of the Act.
Example 7 — Information Sharing

The Canadian Widget Association (CWA) is a trade association that seeks to pro-
mote the interests of Canadian producers of widgets. The CWA’s member roster
includes twenty-five widget producers, five of which are the largest widget produc-
ers in Canada. Collectively, CWA members account for 70% of the market for the
supply of widgets in Canada, although no single member holds more than 10% of
the market. A number of members recently commenced supplying widgets. At an
annual meeting of the CWA, its members unanimously agree to appoint an inde-
pendent third party to collect certain information from each member for purposes
of identifying industry trends and benchmarking. In particular, members agree to
submit data to the third party with respect to sales volumes by customer type and
region, as well as certain historical cost information. The third party will supply
data in an aggregated form to members, such that the sales information from any
single member cannot be identified.
705
Analysis
In this example, CWA members are not agreeing to fix prices, allocate markets or
reduce output. Accordingly, the Bureau would examine the agreement under sec-
tion 90.1 of the Act, and not under subsection 45(1).
In assessing the agreement under section 90.1, the Bureau would consider a number
of factors, including the nature of the information exchanged (i.e., whether the in-
formation is competitively sensitive); the timing of the information exchange (e.g.,
whether the information relates to historical, current or future activities); whether
the parties participating in the information exchange have market power or will
likely have market power; the manner in which the information is collected and
disseminated (e.g., whether the information is shared directly between competitors
or aggregated by a third party); whether parties were coerced to participate in the
information exchange; and whether any anti-competitive effects are offset and out-
weighed by the efficiencies generated through the information sharing agreement.
In the present example, CWA members collectively represent a significant portion
of the supply of widgets in the relevant market and, depending upon barriers to
entry and other factors, may collectively possess market power. The Bureau recog-
nizes that the exchange of information between competitors can impair competition
by reducing uncertainties regarding competitors’ strategies and diminishing each
firm’s commercial independence. However, the information in the present example
will only be shared in an aggregated manner through an independent third party
that does not reveal individual sales or cost data. Accordingly, the information be-
ing supplied to members is not competitively sensitive and the agreement would be
unlikely to lead to a substantial lessening or prevention of competition in the mar-
ket for the supply of widgets. On this basis, the Bureau would not be likely to
challenge the agreement under section 90.1 of the Act.
Example 8 — Joint Research and Development

X and Y enter into a research and development (R&D) joint venture to develop a
new product called a “gizmo”. There is considerable commercial risk associated
with the collaboration. The joint venture agreement specifies that each of the par-
ties must provide substantial funding to the joint venture, and that the parties will
not conduct R&D in respect of gizmos outside of the joint venture, such that com-
peting gizmos will not be developed by the parties in parallel with the gizmo being
developed by the joint venture. Once the gizmo is developed, X and Y are to each
produce and sell the product independently from one another. The joint venture
does not involve the acquisition by X or Y of a significant interest in the other
party’s business so as to be considered a merger under the Act.
Analysis
In the present example, the Bureau would first consider whether X and Y are com-
petitors or potential competitors. To address this issue, the Bureau will examine
whether X and Y are able to develop the product independently from the R&D
agreement. If the parties are unable to do so, then the parties are not considered to
be competitors for the purposes of subsection 45(1) or section 90.1 of the Act.
706
Where the parties are able to develop the product independently, albeit at a higher
cost or over a longer period of time than through the collaborative effort, the Bu-
reau will consider the parties to be competitors.
If the Bureau determines the parties to be competitors, the Bureau will next assess
the nature of the restraint on competition agreed to by the parties. In this example,
there is no evidence to suggest that the agreement is a naked restraint on competi-
tion, the Bureau would initially examine the agreement under section 90.1 of the
Act. Only where the Bureau determines that the agreement is, in substance, an
agreement to allocate sales or markets for the production or supply of a product, or
to prevent, lessen or eliminate the production or supply of a product, would the
Bureau examine the agreement under subsection 45(1).
In assessing R&D agreements under section 90.1, the Bureau will consider a num-
ber of factors, including whether the agreement is limited to R&D or also contains
provisions regarding the joint exploitation of products; whether the parties are
likely to hold market power in the relevant market; whether the restrictions on com-
petition are reasonably necessary for achieving the objective of the R&D agree-
ment; and whether any anti-competitive effects are offset and outweighed by the
efficiencies generated through the R&D agreement.
The Bureau will consider whether the parties to the agreement hold or are likely to
hold market power in respect of the supply of the relevant product. In the absence
of such market power, the agreement is unlikely to substantially lessen or prevent
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competition. To determine this issue, the Bureau will consider whether there are
competitive substitutes that exist in the market or that are under development.
To the extent that the Bureau determines that the agreement is likely to result in a
substantial lessening or prevention of competition, the Bureau would also consider
all available evidence as to whether any anti-competitive effects are offset and out-
weighed by efficiency gains that are likely to result from the agreement, before
determining whether to challenge the agreement under section 90.1 of the Act.
Although the agreement in this example would be assessed under section 90.1, for
the purposes of these Guidelines, this example will also be used to illustrate how
the Bureau’s analysis would proceed in respect of the ancillary restraints defence in
the event that the agreement was assessed under section 45. In considering the de-
fence under subsection 45(4) of the Act, the Bureau will examine whether: (i) the
restraint is ancillary to a broader or separate agreement that includes the same par-
ties; (ii) the restraint is directly related to, and reasonably necessary for giving ef-
fect to, the objective of the broader or separate agreement; and (iii) the broader or
separate agreement, when considered in the absence of the restraint, does not con-
travene subsection 45(1). Of particular relevance is whether the restraint on compe-
tition agreed to by the parties is directly related to and reasonably necessary for
giving effect to the joint venture agreement. In this regard, the Bureau will assess,
among other things, the duration of the ancillary restraint, the subject matter of the
restraint (e.g., whether it applies to products outside of the collaboration between
the competitors) and the scope of the restraint to determine whether it is reasonably
necessary to give effect to the objective of the broader agreement, as required under
the ancillary restraints defence.
707
The Bureau will also consider whether there are significantly less restrictive alter-
natives available to the parties, and whether the parties could have achieved an
equivalent or comparable arrangement through practical, less restrictive means that
were reasonably available to the parties at the time that they entered into the agree-
ment. Among the facts relevant to that determination by the Bureau are the pres-
ence of a broader joint venture agreement, the significant investment required by X
and Y, and the commercial risk associated with the joint venture. The Bureau will
also assess evidence pertaining to whether the parties would invest in the collabora-
tion if one party was able to independently compete with the joint venture.
In the present example, the Bureau would likely conclude that the ancillary re-
straints defence is applicable, and would accordingly proceed to examine the agree-
ment under section 90.1 of the Act, and not subsection 45(1).
Example 9 — Buying Groups

Numerous firms compete with one another in the supply of gizmos in Canada.
Widgets are key inputs to the production of gizmos. Widgets are supplied in Can-
ada by two large firms, X and Y, which offer volume discounts for sizeable widget
purchases. Volume discounts are easily obtained by large buyers, but smaller firms
are often incapable of meeting these volume requirements, and face higher costs as
a result. Ten gizmo manufacturers representing approximately 10% of the total
purchases of widgets from X and Y agree to form a buying group to purchase wid-
gets. The buying group negotiates a common price with X and Y for the supply of
widgets to its members. Also, to ensure that the buying group is able to obtain
desired volume discounts, the buying group imposes a minimum purchase volume
on its members (members wishing to purchase less must buy outside the group).
Analysis
The agreement in this example would be examined under section 90.1 of the Act,
and not subsection 45(1), as it does not constitute an agreement between competi-
tors to fix prices, allocate markets or reduce output in respect of the supply of a
product. Rather, this agreement relates to the purchase of products by competitors.
Given that the buying group’s share of the relevant upstream market is only 10%,
the buying group is unlikely to hold monopsony power with respect to the purchase
of widgets. Accordingly, the Bureau would not be likely to challenge the agreement
under section 90.1.
Example 10 — Output Exchange Agreement

X and Y, competitors located in different regions of Canada, are producers of a
homogeneous commodity product. The commodity product is processed at regional
centres and shipped to distributors who store the commodity and then deliver it to
customers. As they each have a number of national accounts, X and Y have been
selling the commodity to distributors in one another’s regions for many years. Re-
cently, X and Y entered into an agreement whereby they would each buy a fixed
tonnage of the processed commodity from one another’s production facilities. The
agreement allows X and Y to cut the costs of shipping to their respective distribu-
708
tors in one another’s regions. The agreement does not contain any provisions deal-
ing with selling prices or non-price aspects of competition.
Analysis
While this is an agreement between competitors, it would be examined under sec-
tion 90.1 of the Act, and not subsection 45(1), as it does not constitute an agree-
ment to fix prices, allocate markets or reduce output.
In assessing an agreement under section 90.1, the Bureau will consider a number of
factors, including whether the parties to the agreement hold market power; whether
the agreement deals with competitively significant terms of trade; whether the par-
ties are able to supply products outside the scope of the agreement or otherwise
retain the ability to compete independently; and whether the agreement requires or
provides opportunities for the disclosure of competitively sensitive information be-
tween the participants. Among the facts in this example that would be relevant to
the Bureau’s determination is that the agreement permits both X and Y to indepen-
dently compete with respect to price and other aspects in selling the commodity.
While the agreement provides that X and Y will purchase a fixed tonnage of the
commodity each year, it does not impose restrictions on the output of either party in
any way, including by way of restricting the parties from constructing a new facil-
ity or expanding an existing production facility.
Guidelines
To the extent that the Bureau determined that the agreement was likely to result in a
substantial lessening or prevention of competition, the Bureau would also consider
all available evidence as to whether any anti-competitive effects would be offset
and outweighed by efficiency gains that would be likely to result from the agree-
ment, before determining whether to challenge the agreement under section 90.1 of
the Act. On the facts in the present example, however, the Bureau would not be
likely to challenge the agreement under section 90.1.
Example 11 — Product Exchange or Swap Agreement

Firms X and Y are competitors in a commodity market where they face several
larger competitors. While there is a world wholesale price for the commodity, the
retail price at which each firm sells the commodity depends primarily on transpor-
tation costs.
X and Y agree to enter into a product exchange or “swap” agreement, whereby X
will buy the product from Y in eastern Canada, and Y will do the same with X’s
product in western Canada. This allows X and Y to reduce transportation costs and
supply a broader range of customers.
Analysis
This type of agreement does not involve an agreement between competitors to fix
prices, reduce output, or allocate markets or customers, and any competitive issues
that would arise out of the agreement would be examined under section 90.1, and
not subsection 45(1) of the Act.
709
Product exchange agreements that only serve to allow regional firms to reduce
costs and supply a broader range of customers on a competitive basis are not likely
to be challenged by the Bureau.
Example 12 — Trade Association Guideline

In recent years, certain members of the gizmo industry began to report sales orders
as revenues in their public accounting reports. With a downturn in the economy,
most orders did not materialize. This was followed by several unfavourable reports
in the media regarding accounting practices in the gizmo manufacturing industry.
At a meeting of the Canadian Gizmo Manufacturers Association, several members
of the industry expressed concerns about the accounting practices of certain manu-
facturers and the associated impact on the industry’s capitalization and reputation.
Shortly thereafter, the Association issued a non-binding guideline on best account-
ing practices for members of the industry based on advice from accounting
professionals.
Analysis
While members of the Association are very likely to be considered competitors, in
this example, the voluntary industry guideline would not constitute an agreement to
fix prices, allocate markets or reduce output; and, therefore, it would not raise an
issue under subsection 45(1). Similarly, the adoption of a voluntary industry guide-
line on best accounting practices is not likely to substantially lessen or prevent
competition and therefore would not be challenged by the Bureau.
5. — Relevant Provisions of the Act

2. (2) For the purposes of this Act,
(a) one corporation is affiliated with another corporation if one of them is the
subsidiary of the other or both are subsidiaries of the same corporation or each
of them is controlled by the same person;
(b) if two corporations are affiliated with the same corporation at the same
time, they are deemed to be affiliated with each other; and
(c) a partnership or sole proprietorship is affiliated with another partnership,
sole proprietorship or a company if both are controlled by the same person.
(4) For the purposes of this Act,
(a) a corporation is controlled by a person other than Her Majesty if
(i) securities of the corporation to which are attached more than fifty per
cent of the votes that may be cast to elect directors of the corporation are
held, directly or indirectly, whether through one or more subsidiaries or
otherwise, otherwise than by way of security only, by or for the benefit of
that person, and
(ii) the votes attached to those securities are sufficient, if exercised, to
elect a majority of the directors of the corporation;
710
(b) a corporation is controlled by Her Majesty in right of Canada or a province

if
(i) the corporation is controlled by Her Majesty in the manner described
in paragraph (a), or
(ii) in the case of a corporation without share capital, a majority of the
directors of the corporation, other than ex officio directors, are appointed
by
(A) the Governor in Council or the Lieutenant Governor in Council
of the province, as the case may be, or
(B) a Minister of the government of Canada or the province, as the
case may be; and
(c) a partnership is controlled by a person if the person holds an interest in the
partnership that entitles the person to receive more than fifty per cent of the
profits of the partnership or more than fifty per cent of its assets on dissolution.
45. (1) Every person commits an offence who, with a competitor of that person with
respect to a product, conspires, agrees or arranges
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ply of the product.
(2) Every person who commits an offence under subsection (1) is guilty of an indict-
able offence and liable on conviction to imprisonment for a term not exceeding 14
years or to a fine not exceeding $25 million, or to both.
(3) In a prosecution under subsection (1), the court may infer the existence of a
conspiracy, agreement or arrangement from circumstantial evidence, with or without
direct evidence of communication between or among the alleged parties to it, but,
for greater certainty, the conspiracy, agreement or arrangement must be proved be-
yond a reasonable doubt.
(4) No person shall be convicted of an offence under subsection (1) in respect of a
conspiracy, agreement or arrangement that would otherwise contravene that subsec-
tion if
(i) it is ancillary to a broader or separate agreement or arrangement that
includes the same parties, and
(ii) it is directly related to, and reasonably necessary for giving effect to,
the objective of that broader or separate agreement or arrangement; and
(b) the broader or separate agreement or arrangement, considered alone, does
not contravene that subsection.
conspiracy, agreement or arrangement that relates only to the export of products
from Canada, unless the conspiracy, agreement or arrangement
711
(c) is in respect only of the supply of services that facilitate the export of prod-
ucts from Canada.
(6) Subsection (1) does not apply if the conspiracy, agreement or arrangement
(a) is entered into only by companies each of which is, in respect of every one
of the others, an affiliate; or
49(1).
(7) The rules and principles of the common law that render a requirement or authori-
zation by or under another Act of Parliament or the legislature of a province a de-
fence to a prosecution under subsection 45(1) of this Act, as it read immediately
before the coming into force of this section, continue in force and apply in respect of
a prosecution under subsection (1).
(8) The following definitions apply in this section.
“competitor” includes a person who it is reasonable to believe would be likely to
compete with respect to a product in the absence of a conspiracy, agreement or ar-
rangement to do anything referred to in paragraphs (1)(a) to (c).
“price” includes any discount, rebate, allowance, price concession or other advan-
tage in relation to the supply of a product.
45.1 No proceedings may be commenced under subsection 45(1) against a person on
the basis of facts that are the same or substantially the same as the facts on the basis
of which an order against that person is sought by the Commissioner under section
76, 79, 90.1 or 92.
85. For the purposes of this section and sections 86 to 90,
...
“specialization agreement” means an agreement under which each party thereto
agrees to discontinue producing an article or service that he is engaged in producing
at the time the agreement is entered into on the condition that each other party to the
agreement agrees to discontinue producing an article or service that he is engaged in
producing at the time the agreement is entered into, and includes any such agree-
ment under which the parties also agree to buy exclusively from each other the arti-
cles or services that are the subject of the agreement.
90. Section 45, section 77 as it applies to exclusive dealing, and section 90.1 do not
apply in respect of a specialization agreement, or any modification of such an agree-
ment, that is registered.
90.1 (1) If, on application by the Commissioner, the Tribunal finds that an agree-
ment or arrangement - whether existing or proposed - between persons two or more
of whom are competitors prevents or lessens, or is likely to prevent or lessen compe-
tition substantially in a market, the Tribunal may make an order
(a) prohibiting any person — whether or not a party to the agreement or ar-
rangement -from doing anything under the agreement or arrangement; or
712
(b) requiring any person — whether or not a party to the agreement or arrange-
ment - with the consent of that person and the Commissioner, to take any other
action.
(2) In deciding whether to make the finding referred to in subsection (1), the Tribu-
nal may have regard to the following factors:
(a) the extent to which foreign products or foreign competitors provide or are
likely to provide effective competition to the businesses of the parties to the
agreement or arrangement;
(b) the extent to which acceptable substitutes for products supplied by the par-
ties to the agreement or arrangement are or are likely to be available;
(c) any barriers to entry into the market, including
(iii) regulatory control over entry;
(d) any effect of the agreement or arrangement on the barriers referred to in
paragraph (c);
(e) the extent to which effective competition remains or would remain in the
market;
(f) any removal of a vigorous and effective competitor that resulted from the
agreement or arrangement, or any likelihood that the agreement or arrange-
Guidelines
ment will or would result in the removal of such a competitor;
(g) the nature and extent of change and innovation in any relevant market; and
(h) any other factor that is relevant to competition in the market that is or
would be affected by the agreement or arrangement.
(3) For the purpose of subsections (1) and (2), the Tribunal shall not make the find-
ing solely on the basis of evidence of concentration or market share.
(4) The Tribunal shall not make an order under subsection (1) if it finds that the
agreement or arrangement has brought about or is likely to bring about gains in
efficiency that will be greater than, and will offset, the effects of any prevention or
lessening of competition that will result or is likely to result from the agreement or
arrangement, and that the gains in efficiency would not have been attained if the
order had been made or would not likely be attained if the order were made.
(5) For the purposes of subsection (4), the Tribunal shall not find that the agreement
or arrangement has brought about or is likely to bring about gains in efficiency by
reason only of a redistribution of income between two or more persons.
(6) In deciding whether the agreement or arrangement is likely to bring about the
gains in efficiency described in subsection (4), the Tribunal shall consider whether
such gains will result in
(7) Subsection (1) does not apply if the agreement or arrangement is entered into, or
would be entered into, only by companies each of which is, in respect of every one
of the others, an affiliate.
713
(8) Subsection (1) does not apply if the agreement or arrangement relates only to the
export of products from Canada, unless the agreement or arrangement
(c) has prevented or lessened or is likely to prevent or lessen competition sub-
stantially in the supply of services that facilitate the export of products from
Canada.
(9) The Tribunal shall not make an order under subsection (1) in respect of
(a) an agreement or arrangement between federal financial institutions, as de-
fined in subsection 49(3), in respect of which the Minister of Finance has certi-
fied to the Commissioner
(ii) the Minister of Finance’s request for or approval of the agreement or
arrangement for the purposes of financial policy;
(b) an agreement or arrangement that constitutes a merger or proposed merger
under the Bank Act, the Cooperative Credit Associations Act, the Insurance
Companies Act or the Trust and Loan Companies Act in respect of which the
Minister of Finance has certified to the Commissioner
(ii) the Minister of Finance’s opinion that the merger is in the public in-
terest, or that it would be in the public interest, taking into account any
terms and conditions that may be imposed under those Acts; or
(c) an agreement or arrangement that constitutes a merger or proposed merger
approved under subsection 53.2(7) of the Canada Transportation Act in re-
spect of which the Minister of Transport has certified to the Commissioner the
names of the parties to the agreement or arrangement.
(10) No application may be made under this section against a person on the basis of
facts that are the same or substantially the same as the facts on the basis of which
(a) proceedings have been commenced against that person under section 45 or
49; or
(b) an order against that person is sought by the Commissioner under section
76, 79 or 92.
(11) In subsection (1), “competitor” includes a person who it is reasonable to believe
would be likely to compete with respect to a product in the absence of the agreement
or arrangement.
6. — How to Contact the Competition Bureau

714
Web site
Address
Information Centre
Competition Bureau
50 Victoria Street
Gatineau, Quebec
K1A 0C9
Telephone
Toll-free: 1-800-348-5358
Facsimile
819-997-0324
Guidelines
715
IMMUNITY AND LENIENCY PROGRAMS UNDER
THE COMPETITION ACT*
—
March 15, 2019
Preface
The purpose of the Immunity and Leniency Programs (Programs) is to uncover and
stop criminal anti-competitive activity prohibited by the Competition Act (Act)1
and to deter others from engaging in similar behaviour. The Programs are adminis-
tered jointly by the Director of Public Prosecutions (DPP) and the Commissioner of
Competition (Commissioner). Under the Programs, the Competition Bureau (Bu-
reau), headed by the Commissioner, is responsible for investigating alleged wrong-
doing and making recommendations to the Public Prosecution Service of Canada
(PPSC) to grant immunity and leniency. The PPSC, under the direction of the DPP,
Guidelines
is responsible for the decision to enter into an immunity or plea agreement with an
applicant in accordance with the principles set out in the Public Prosecution Service
of Canada Deskbook2 (PPSC Deskbook). These responsibilities are discharged by
the Bureau and the PPSC, in mutual recognition of the other’s independence.
Immunity is an extraordinary grant by the Crown to forego prosecution, while leni-
ency is a discretionary decision by the Crown to recommend a reduction of the
sanctions to be imposed by a court. The PPSC and the Bureau recognize that it is in
the public interest to offer immunity from prosecution or lenient treatment to a
participant who is willing to terminate its participation in serious criminal activity
under the Act and to provide significant cooperation to an investigation. The PPSC
and the Bureau also recognize that clarity, predictability and transparency are cru-
cial to the effective operation of the Programs, because they entail a sincere com-
mitment by an immunity or leniency applicant to address illegal wrongdoing and to
fully cooperate with the Bureau and the Crown in investigating and prosecuting
others implicated in the illegal activity.
* Immunity and Leniency Programs under the Competition Act, (May 15, 2019), Innovation,
Science and Economic Development Canada, https://www.competitionbureau.gc.ca/eic/site/
cb-bc.nsf/eng/04391.html. Reproduced with the permission of the Minister of Innovation,
Science and Economic Development, 2020. The content of this publication may be subject to
change or may be removed from the Government website without notice.
1 Competition Act, R.S.C. 1985, c. C-34.
2 Available online through Public Prosecution Service of Canada’s website.
717
Immunity Program
These Programs have proven to be powerful means of detecting criminal activity.

The Programs’ contributions to effective enforcement are unmatched. Their contin-
ued appeal as an incentive for those who would otherwise remain undercover to
disclose their criminal behaviour is pivotal to the Bureau’s enforcement efforts. As
part of the Bureau’s and the PPSC’s commitment to respond to changes in the legal
and enforcement environment, the Commissioner in conjunction with the DPP are
pleased to present this updated version with adjustments designed to clarify the
Bureau’s approach and to keep pace with the changes that have affected the Pro-
grams’ ability to provide transparency and predictability to those who would coop-
erate with the Bureau and the PPSC. We trust the updated Programs will enhance
Canada’s ability to detect, investigate and prosecute criminal behaviour in the field
of competition law.
Matthew Boswell
Kathleen Roussel
Director of Public Prosecutions
718
Immunity Program
Table of contents
Introduction . . . . . . . . . . . . . . . . . . 719
Part one: The Immunity Program . . . . . . . . . . . . . . . . . . . . . . . . . . . 722
Part two: The Leniency Program . . . . . . . . . . . . . . . . . . . . . . . . . . . 737
Part three: Matters common to the Immunity and Leniency programs

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 752
Appendix 1: Criminal provisions of the Competition Act . . . . . . . . 755
Appendix 2: Information checklist . . . . . . . . . . . . . . . . . . . . . . . . . . 758
Appendix 3: Template documents . . . . . . . . . . . . . . . . . . . . . . . . . . 761
Introduction
Guidelines
1. The Competition Act (Act) is a law of general application that establishes basic
principles for the conduct of business in Canada. The Act maintains and encourages
competition:
a. to promote the efficiency and adaptability of the Canadian economy;
b. to expand opportunities for Canadian participation in world markets while
recognizing the role of foreign competition in Canada;
c. to ensure small and medium-sized enterprises have equal opportunity to par-
ticipate in the Canadian economy; and
d. to provide consumers with competitive prices and product choices.
2. The Commissioner is the head of the Bureau and has the authority to administer
and enforce the Act. The Bureau is the organization that carries out investigations
under the Act.
3. The Act includes criminal provisions3 that prohibit anti-competitive business ac-
tivities, including conspiracies between competitors or potential competitors to fix
prices, allocate markets or restrict output (e.g., price fixing, market allocation or
output restriction agreements) and bid-rigging, as well as deceptive marketing prac-
tices and false or misleading representations. The criminal provisions of the Act are
serious criminal offences that can carry significant fines and terms of imprison-
ment. For example, offending the conspiracy provision carries a maximum fine of
$25 million or imprisonment of up to 14 years in prison, or both.
3 See Appendix I for relevant provisions.
719
Immunity Program
4. The Bureau, like other law enforcement agencies, recognizes the importance of
programs that contribute to the detection, investigation and prosecution of serious
crimes. This Bulletin details the Bureau’s approach to recommending immunity
and leniency in sentencing for self-reported violations of the Act for companies and
individuals that cooperate in the investigation and prosecution of offences.
5. This Bulletin describes the roles and responsibilities of the Commissioner and
the DPP,4 the requirements an applicant must satisfy to obtain immunity or leni-
ency, the impact of corporate immunity or leniency on directors, officers, employ-
ees and agents, the steps in the respective immunity or leniency process and the
impact of failure to comply with the requirements of an immunity or plea agree-
ment. It addresses timing issues, including those that may arise in the context of
international criminal activity and multi-jurisdictional investigations, and sets out
the confidentiality assurances that the Bureau will make to an applicant.
6. This Bulletin does not provide legal advice. It expands upon and supersedes ear-
lier bulletins and public statements by the Bureau. Readers should refer to the Act
when questions of law arise and obtain legal advice when appropriate.
7. This Bulletin is divided into three parts: Part One describes the Immunity Pro-
gram, Part Two describes the Leniency Program and Part Three describes certain
matters common to both Programs. As provided below, the Immunity Program is
available only to the first party (e.g. a cartelist or deceptive marketer) to self-report
an offence under the Act whereas the Leniency Program is available to other parties
to a cartel.5 While the obligations owed by applicants are similar under both Pro-
grams, the consequences are markedly different — immunity applicants may be eli-
gible to be immunized from prosecution for offences under the Act whereas leni-
ency applicants are expected to plead guilty to an offence under the Act and incur a
penal sentence.
8. For the purposes of this Bulletin, the term “party” means a business organization
or an individual, as the case may be. The terms “business organization” and “com-
pany” are used interchangeably. An “immunity applicant” means a party applying
to the Bureau under the Immunity Program and a “leniency applicant” means a
party applying to the Bureau under the Leniency Program.
4 Pursuant to the Director of Public Prosecution Act, the DPP’s mandate includes initiating
and conducting prosecutions under federal jurisdiction and advising law enforcement agen-
cies and investigative bodies on prosecutions and investigations. The DPP is the head of the
PPSC. The PPSC is independent of the Department of Justice Canada and reports to Parlia-
ment through the Attorney General.
5 As described below, the Immunity Program applies to the offences under sections 45 to 49
(cartel offences) as well as offences found in sections 52 through 55.1 of the Act, whereas
the Leniency Program is available only with respect to the cartel offences. Individuals and
business organizations seeking further information on lenient treatment for matters related to
deceptive marketing practices should contact the Deputy Commissioner, Deceptive Market-
ing Practices Directorate directly.
720
Immunity Program
Roles of the Commissioner, the Director of Public Prosecutions and

the courts
9. It is the responsibility of the Commissioner (and the Bureau) to investigate a
matter that may engage the Act. Where there is evidence of an offence, the Com-
missioner may refer a matter to the DPP for consideration. In matters related to the
exercise of the DPP’s discretion, including a grant of immunity or leniency, the
DPP (and the PPSC) is not bound by the Bureau’s policies and procedures.
10. The Bureau’s role is to make responsible and informed recommendations to the
DPP. In accordance with the PPSC Deskbook,6 the DPP will consult with the Bu-
reau and give due consideration to its recommendations. However, the DPP retains
its independent discretion to accept or reject the Bureau’s recommendations.
11. Criminal prosecutions under the Act are the responsibility of the DPP. The DPP
has the sole authority to grant immunity or leniency to a party implicated in an
offence under the Act.7 The DPP’s policy on the granting of immunity and leniency
in matters related to the Act is articulated in the PPSC Deskbook.8
12. The respective roles and responsibilities of the Bureau and the PPSC are further
described in the memorandum of understanding between the Commissioner and the
DPP.9
13. Immunity agreements do not require judicial approval. However, under the Le-
niency Program, leniency applicants are required to enter a guilty plea in court. In
Guidelines
this circumstance, the DPP and defence counsel typically make a joint sentencing
submission. While the court has the sole authority to determine an appropriate sen-
tence, judges understand that the DPP and the defendant are entitled to have a high
degree of confidence that a joint sentencing submission will be accepted and will
not be departed from unless the proposed sentence would bring the administration
of justice into disrepute or would otherwise be contrary to the public interest.10
This is a high threshold and is intended to foster confidence that the joint sentenc-
ing submission will be respected by a sentencing judge.
6 See chapter 5.2: Competition Act [Director’s guideline issued under section 3(3)(c) of the
Director of Public Prosecutions Act] (Part V): available online through Public Prosecution
Service of Canada’s website.
7 The PPSC Deskbook guides the conduct of federal prosecutors and provides that the DPP
should consult with the Bureau in the course of assessing the public interest. See section 3.4
of chapter 2.3 (Part II) and section 4.1 of chapter 5.2 (Part V) of the PPSC Deskbook.
8 Supra note 6. Crown counsel are also guided by Deskbook chapter 3.3 — Immunity
Agreements.
9 Memorandum of Understanding between the Commissioner of Competition and the Direc-
tor of Public Prosecutions.
10 See, for example, R. v. Anthony-Cook, 2016 SCC 43.
721
Immunity Program
Part one: — The Immunity Program

Obtaining immunity
14. A party implicated in domestic or international unlawful conduct that may vio-
late the Act’s criminal provisions11 may offer to cooperate with the Bureau and
request immunity. A company may, but does not have to, initiate an application on
behalf of its employees. Employees may approach the Bureau on their own behalf.
15. In this Bulletin, the term “immunity” refers to a grant of immunity from prose-
cution under the Act. A party who does not qualify for immunity but cooperates
with the Bureau’s investigation may be eligible for a recommendation for lenient
treatment in sentencing, as described in Part Two of this Bulletin.
Timing and required information

16. A party should come forward, in the manner described in paragraph 48, as soon
as it believes it is implicated in an offence as the Bureau will grant an immunity
marker, with respect to particular conduct, only to the first party to request
immunity.
17. Timing is critical to the Bureau’s enforcement interest and, in particular, to
locating evidence as quickly as possible and coordinating investigatory steps with
other jurisdictions if necessary. Consequently, the program provides valuable in-
centives to encourage parties to apply for immunity as soon as possible.
18. The Act may be violated whether or not the applicant supplies products directly
or indirectly in, from or into Canada. A party should seek immunity regardless of
whether it supplies products directly or indirectly into Canada. Further, a party that
does not sell products into Canada as part of a market allocation agreement, con-
trary to section 45 of the Act, or a party that agrees not to submit a bid in response
to a call or request for bids or tenders contrary to section 47 of the Act may also
seek immunity.12
19. Similarly, in the case of deceptive marketing practices, a party should request
an immunity marker if it believes that it has, for example, engaged in deceptive
telemarketing contrary to section 52.1 of the Act that targets consumers located
outside Canada from call centres located in Canada.13
20. If an applicant later determines that it was not involved in an offence, it should
notify the appropriate Deputy Commissioner and withdraw its immunity marker.
11 Immunity is not available for obstruction, for destruction of records or other things (col-
lectively, records), or for any offence under the Act other than those identified in this
Bulletin.
12 Sections 45 to 49 of the Act are administered by the Deputy Commissioner, Cartels
Directorate.
13 Sections 52 to 55.1 of the Act are administered by the Deputy Commissioner, Deceptive
Marketing Practices Directorate.
722
Immunity Program
21. It is not necessary for a party to have assembled a complete record of the infor-
mation required when first contact is made with the Bureau. As the application
process progresses, and before an immunity agreement is finalized, the Commis-
sioner and the DPP will carefully examine an applicant’s immunity request and
subsequent cooperation to ensure that it complies with the Immunity Program’s
requirements.
22. An applicant is required to provide complete, timely and ongoing cooperation,
at its own expense, throughout the Bureau’s investigation and any subsequent pros-
ecution, including witnesses’ travel to and from the Bureau or DPP offices.
Eligibility
23. Subject to the requirements set out below, and consistent with fair and impartial
administration of the law, the Commissioner will recommend to the DPP that im-
munity be granted to a party in only the following circumstances:
a. the Bureau is unaware of an offence, and the applicant is the first to disclose
all elements of the offence; or
b. the Bureau is aware of an offence, and the applicant is the first to come
forward before the Bureau gathers sufficient evidence to warrant a referral of
the matter to the DPP.
24. An applicant is required to stop participating in the illegal activity to qualify for
Guidelines
immunity. When an offence is ongoing at the time that a request for immunity is
made, an applicant, at the earliest opportunity, should raise with the Bureau any
concerns it may have about what it can or cannot do to comply with this require-
ment and the possible impact that compliance or non-compliance could have on the
Bureau’s investigation.
25. The applicant must not have coerced others to be party to the illegal activity.
An applicant will be ineligible where there is clear evidence of coercive behaviour,
either express or implied. In particular, where there is evidence that the applicant
pressured unwilling participants to be involved in the offence, the applicant will not
be eligible for immunity.
26. Companies and individuals must demonstrate that they were a party to the of-
fence in order to be eligible for immunity. A party to an offence is an individual or
organization described in sections 21, 22 and 22.2 of the Criminal Code.14
27. A recommendation for immunity will only be made when the disclosed conduct
constitutes an offence under the Act and is supported by credible and reliable evi-
dence that demonstrates all elements of the offence.15
14 R.S.C. 1985, c. C-46 (Criminal Code).

15 As described in step 3 of The Immunity Process, a grant of interim immunity will be
recommended when the disclosed conduct demonstrates an offence under the Act and it ap-
pears that all other eligibility criteria are met.
723
Immunity Program
28. If an applicant provides insufficient information to demonstrate that it commit-

ted an offence, the Bureau will make no recommendation to the DPP as to a grant
of immunity and will request that the applicant withdraw its immunity marker. In
the event that the applicant does not withdraw its immunity marker, the immunity
marker will be cancelled by the Deputy Commissioner following a minimum of 14
calendar days’ notice.
29. Where the applicant is the only party involved in the offence it will not be
eligible for immunity. For example, the offence of false or misleading representa-
tions may be committed by one organization and be intended for the sole benefit of
that organization. Individuals employed by an organization ineligible as a result of
being the sole participant may be separately eligible under the Immunity Program,
as their admissions and evidence may further an investigation of the organization.
Individuals are encouraged to apply for immunity through their own separate
counsel.
30. Subsequent applicants who are party to the cartel offence may seek a leniency
marker under the Bureau’s Leniency Program, as described in Part Two.
Subsequent to the immunity application

31. Subject to paragraph 28, in cases in which it does not intend to further investi-
gate, the Bureau will not make a formal recommendation for immunity to the DPP
but rather will advise the applicant of the scope of the formal recommendation for
immunity that it otherwise would have made to the DPP if the investigation had
continued. This typically will be done verbally, unless the applicant requests or
circumstances otherwise require that it be done in writing. When a matter does not
proceed at the Bureau’s discretion, the immunity marker will be put into abeyance,
(i.e. defined and preserved by the scope identified by the Bureau). For example,
where a marker request identified a national geographic market but the conduct
only affected a specific regional market, the Bureau may preserve the marker on a
regional market basis. Matters and conduct not included will not be preserved and
will be considered anew should the applicant or another party subsequently seek an
immunity marker.
32. If the Bureau subsequently decides that it will investigate the alleged unlawful
conduct, it will advise the applicant and take steps to recommend that immunity be
granted in accordance with the Immunity Program, provided that the organization
and individual(s) that would be covered by the recommendation for immunity con-
tinue to meet its conditions.
33. The Bureau will not commence civil proceedings against an applicant in rela-
tion to the same or substantially the same facts that formed the basis of a grant of
immunity in relation to the criminal provisions of the Act. The Bureau will treat the
applicant in the same manner as if it had pleaded guilty to the offence for which it
received immunity.
724
Immunity Program
Cooperation required
34. Throughout the course of the Bureau’s investigation and subsequent prosecu-
tion, the applicant must provide complete, timely and ongoing cooperation. While
the scope and content will vary with each case, at a minimum, cooperation includes
the following:
a. Confidentiality. Confidentiality helps to ensure that the integrity of the Bu-
reau’s investigation is maintained, that evidence is not destroyed, and that
targets of the investigation do not become prematurely aware of investigative
steps.
Unless made public by the Commissioner or the DPP, or as required by law in
Canada or elsewhere, the applicant shall not disclose its application for an im-
munity marker, its cooperation and subsequent grant(s) of immunity, or any
related information, to a third party.
Where disclosure is required by law or necessary to give effect to or further
the application for immunity, the applicant must give notice to and consult
with the Bureau and the DPP to reconcile where possible these disclosure obli-
gations with the confidentiality requirements of the Immunity Program. The
applicant shall give this notice as soon as it becomes aware of the disclosure
requirement.
An applicant may disclose its application for an immunity marker and subse-
Guidelines
quent grant(s) of immunity, or any related information to:
i. its counsel;
ii. agencies in foreign jurisdictions to which the applicant has made simi-
lar applications for immunity or leniency; and,
iii. with the prior consent of the Bureau, to any third party. Depending on
the circumstances, the Bureau may require that the applicant obtain the
consent of the DPP.
If an applicant or any of the individuals within the scope of the applicant’s
immunity application improperly disclose the application before obtaining
consent or otherwise notifying the Bureau, they risk being found in breach of
the cooperation requirement and may be ineligible to receive a grant of
immunity.
b. Exhaustive internal investigation. The requirements of the Immunity Pro-
gram necessitate that an applicant reveal any and all conduct of which it is
aware, or becomes aware, that may constitute an offence under the Act and in
which it may have been involved.
Applicants will be expected to exercise reasonable due diligence in determin-
ing whether they have been involved in other criminal offences under the Act.
Disclosure of the offences should be made as soon as possible after an immu-
nity application and will be required before the Bureau recommends that the
DPP sign an immunity agreement with the applicant.
c. Full, complete and truthful disclosure. The applicant must provide full,
complete and truthful disclosure of all non-privileged information, evidence
725
Immunity Program
and records in its possession, under its control or available to it, wherever
located, that in any manner relate to the unlawful conduct for which immunity
is sought. Further, absent compelling reasons, an applicant is expected to iden-
tify all of the other jurisdictions where it has made a similar application for
immunity or leniency. Overall, there must be no misrepresentation of any ma-
terial facts.
Non-privileged records to be disclosed in support of an immunity application
include those responsive to the required information described in Appendix 2.
The Immunity Program does not require applicants to waive applicable legal
privileges that attach to records as a condition for obtaining immunity.
When an applicant chooses to withhold a record on the basis of legal privilege,
the applicant must provide the Bureau with notice of the claim of privilege,
the specific legal privilege being relied upon, and the nature of the record to
which the privilege is purported to attach. The Bureau will provide this infor-
mation to the DPP who may seek a determination of any privilege claim with
the assistance of an independent counsel (IC) or a court of law. Additional
explanation regarding this process can be found in paragraphs 98 to 100.
Offences uncovered after the signing of the immunity agreement must be
brought to the attention of the Bureau and the DPP at the earliest possible
time. The Immunity and Leniency Programs as well as Immunity Plus status
may apply to the additionally disclosed conduct.16
An applicant, or any of the individuals within the scope of the applicant’s im-
munity application, that provides false or misleading information to the Bu-
reau in the context of an immunity application or during the performance of
related obligations may be considered ineligible for immunity and face revo-
cation of its Grant of Interim Immunity (GII).17 Such a person could also face
a criminal charge of obstruction under section 64 of the Act, or of destroying
or altering records under section 65 of the Act, or charges under the Criminal
Code, including perjury or obstruction.
When an applicant becomes aware of instances of obstruction or destruction of
records or other things arising in relation to activity for which immunity is
sought, it should be brought to the attention of the Bureau as soon as possible.
While each instance will be considered on a case-by-case basis, generally the
approach taken by the Bureau and the DPP will result in the ineligibility for a
recommendation or grant of immunity of individuals involved with obstruc-
tion or destruction of records. The applicant may be ineligible for a recom-
mendation or grant of immunity when it was complicit in the misconduct or
has prejudiced the Commissioner’s investigation or subsequent prosecution.
d. Witness cooperation. Companies must take all lawful measures to secure
the cooperation of current directors, officers and employees suspected of being
16 For a description of Immunity Plus, see paragraphs 141 to 143.

17 For a description of the GII, see Step 3 at paragraphs 73 to 77 in Part One of this Bulletin.
726
Immunity Program
involved in an offence for the duration of the investigation and any ensuing
prosecution. Companies must also take all lawful measures to secure the coop-
eration of former directors, officers and employees as well as current and for-
mer agents suspected of being involved in the offence, where doing so will not
jeopardize the investigation and where the company has the consent of the
Bureau or the DPP, as set out in subparagraph 34(a). Companies shall en-
courage such persons to voluntarily provide to the Commissioner and the DPP
all non-privileged information, evidence and records in their possession or
under their control, wherever located, that in any manner relate to the unlawful
conduct.
Companies must facilitate the ability of current and former directors, officers,
employees and agents to attend interviews and to provide testimony in judicial
proceedings in connection with the unlawful conduct.
e. Cooperating party status. Cooperating parties are not confidential inform-
ers. Notwithstanding any representations made by the Bureau or others about
confidentiality of identity and information, nothing in this program confers
confidential informer status to a cooperating party. While the PPSC and the
Bureau will keep the identity of a cooperating party confidential in certain
circumstances, as explained in this document, the identity of a cooperating
party and any information that might tend to identify them are not subject to
informer privilege.
Guidelines
f. Financial commitment. Parties must cooperate with the Bureau’s investiga-
tion and any subsequent prosecution at their own expense, including, but not
limited to, all costs related to document production, translation and travel.
Impact of corporate immunity on directors, officers, employees and

agents
35. If a company qualifies for a recommendation for immunity, all current direc-
tors, officers and employees who admit their knowledge of or participation in an
offence under the Act as part of the corporate admission, and who are willing to
provide complete, timely and ongoing cooperation, also qualify for the same rec-
ommendation for immunity. Former directors, officers and employees who admit
their knowledge of or participation in an offence under the Act and offer to co-
operate with the Bureau’s investigation may also qualify for a recommendation of
immunity, however, the Bureau will make any such determination on a case-by-
case basis.
36. Agents of a company that qualifies for a recommendation for immunity may be
included in the same recommendation for immunity. The Bureau will make any
such determination on a case-by-case basis. To qualify, an agent will, at a mini-
mum, be required to admit their knowledge of or participation in the unlawful con-
duct and be willing to provide complete, timely and ongoing cooperation with the
Bureau’s investigation and any subsequent prosecution.
37. If a company does not qualify for a recommendation for immunity, current or
former directors, officers, employees or agents may nonetheless be considered for
727
Immunity Program
immunity, as though they had approached the Bureau individually. To qualify, they
will be required to admit their knowledge of or participation in the unlawful con-
duct and be willing to provide complete, timely and ongoing cooperation with the
Bureau’s investigation and any subsequent prosecution. The scope of the applica-
tion will be considered on a case-by-case basis.
Obtaining the cooperation of directors, officers, employees and agents

38. If an applicant requires the cooperation of a current director, officer, employee
or agent and is concerned that approaching the person could alert other parties to
the offence and affect the Bureau’s investigation, it should contact the Bureau for
guidance before approaching the person.
39. Before seeking the cooperation of an agent or a former director, officer or em-
ployee, the applicant must seek the consent of the Bureau.
40. Current and former directors, officers, employees and agents who intend on
cooperating with the investigation must abide by the confidentiality obligations and
the other requirements or risk being excluded from the Immunity Program.
The immunity process

41. The immunity process is predicated upon ongoing obligations owed by the ap-
plicant to the Bureau and the DPP. An applicant is required to provide complete,
timely and ongoing cooperation to the Bureau and the DPP, at its own expense,
throughout the Bureau’s investigation and any subsequent prosecution. When the
requirements are satisfied, the applicant will be eligible for immunity from prose-
cution for the offence(s) disclosed.
42. The immunity application will follow a four step process: initial contact
(marker request), proffer, GII (full disclosure and cooperation) and immunity
agreement. While there may be some flexibility with the timelines associated with
the immunity process, it is expected that the applicant will have 30 days from the
date the marker was granted to complete its proffer and will have to complete its
disclosure within six months of the DPP issuing the GII.
43. The Bureau is sensitive to the concerns of applicants about written proffers and
other exchanges and, as a result, will permit a “paperless process”.18
Step 1: — Initial Contact (the Marker Request)

44. An “immunity marker” is the confirmation given to an applicant that it is the
first party to approach the Bureau requesting a recommendation of immunity with
respect to an offence under the Act. The immunity marker guarantees the appli-
cant’s place at the front of the line, subject to the applicant meeting all of the re-
quirements of the Immunity Program.
18 The paperless process only applies to communications between an applicant and the
Bureau.
728
Immunity Program
45. A party may request an immunity marker for unlawful conduct subject to crimi-
nal sanction under Part VI of the Act. Offences described in sections 45 to 49 of the
Act, including conspiracy (sections 45 and 46) and bid-rigging (section 47), are
enforced by the Bureau’s Cartels Directorate. False or misleading representations
and deceptive marketing practices (sections 52 through 55.1) are enforced by the
Bureau’s Deceptive Marketing Practices Directorate.
46. In addition, an individual may request an immunity marker for such offences
when liability arises from aiding or abetting any of these offences contrary to sec-
tion 21 of the Criminal Code or counselling any of these offences contrary to sec-
tion 22 of the Criminal Code.
47. Only one immunity marker will be granted for each offence, regardless of
whether liability arises directly from the Act or through the application of section
21 or 22 of the Criminal Code.
48. It is recommended that an immunity marker request be made by telephone and
that the applicant clearly states that it is making an immunity marker call. The ap-
plicant should ensure that all information is clearly received and that it and the
Deputy Commissioner are in agreement that an immunity marker has been re-
quested on the date and time of the request, and on the description of the relevant
product or business interest.
49. An applicant can make the first contact on the basis of a limited hypothetical
Guidelines
disclosure that identifies the nature of the unlawful conduct committed in respect of
a specified product or business interest. At this stage of the process, the applicant’s
identity does not need to be disclosed.
50. Although an applicant can provide a limited disclosure during its first contact,
the Bureau will require sufficient information to determine whether an applicant is
first-in under the Immunity Program. It does this by comparing the conduct and
product or business interest description provided by the applicant to information
already in the Bureau’s possession. This enables the Bureau to determine whether
another party previously requested an immunity marker for the same conduct, prod-
uct or business interest.
51. For this reason, it is imperative that the applicant, when identifying the offence,
provide a precise product or business interest definition, including a description of
any sub-products that may be covered within the scope of the immunity marker
request, as well as the time period for the conduct in question. In some circum-
stances, the Bureau may request more detailed information regarding the offence,
the product or geographic market, the business interest, the relevant time period or
the other parties involved to assist it in the determination of whether the requested
immunity marker is available.
52. The Bureau generally will not consider joint requests by business organizations;
only one party per offence will receive an immunity recommendation under the
Immunity Program. The Bureau may make an exception in the case of a joint re-
quest from companies that are affiliated, as defined in subsection 2(2) of the Act.
53. While the request is typically made by an applicant’s legal representative, any-
one may initiate a request for immunity by communicating with the Deputy Com-
729
Immunity Program
missioner, Cartels Directorate, or the Deputy Commissioner, Deceptive Marketing

Practices Directorate, as the case may be, to discuss the possibility of receiving
immunity from prosecution in connection with an offence under the Act.19 The
DPP does not accept or grant immunity markers. An applicant cannot rely on any
alternative contact at the Bureau or PPSC in respect of an application to obtain an
immunity marker.
54. As soon as possible following the request, usually within a few days of receiv-
ing all requested information, the Deputy Commissioner will advise the applicant
whether the requested immunity marker is available. If available, the Deputy Com-
missioner will also provide the name and contact information of the lead officer
assigned carriage of the matter. At this time, the Deputy Commissioner will con-
firm with the Applicant that notwithstanding any confidentiality protections that
form part of the immunity program, neither the immunity applicant nor any of its
cooperating directors, officers, employees, or agents will be treated as confidential
informers and will not be sheltered by informer privilege.
55. Upon issuance of the immunity marker the applicant is required to identify it-
self to the Deputy Commissioner or to the lead officer assigned carriage of the file
in order to facilitate the Bureau’s investigation.
Step 2: — Proffer
56. Once an immunity marker is granted, the applicant has 30 calendar days to
provide the Bureau with a detailed statement describing the unlawful conduct. This
statement is known as a “proffer”. A date to provide the proffer can be set by con-
tacting the lead officer with carriage of the file. In general terms, the proffer must
provide the Bureau with a sufficient understanding of the relevant conduct, the con-
text in which it occurred and the evidence available to support the allegations.
57. Proffers are generally provided on a “without prejudice” basis by an applicant’s
counsel. Topics to be covered in a proffer include those set out in Appendix 2.
58. In the proffer, an applicant describes in detail the unlawful conduct demonstrat-
ing each element of the offence, the applicant’s role in the offence for which immu-
nity is sought and the connection of the unlawful conduct to Canada. The applicant
must also outline all of the supporting evidence and witnesses that it is aware that it
can provide at that point in time.
59. While each case will need to be explained on its own terms, the Bureau will not
under any circumstance accept a bare outline of the unlawful conduct or specula-
tion as to the applicant’s role. A comprehensive disclosure is required at this
juncture.
19 Typically, a Canadian lawyer represents the applicant in its dealings with the Bureau,
although foreign counsel may be present at certain meetings. When in Canada, foreign coun-
sel must ensure that they are acting in accordance with the requirements of the relevant law
society or professional organization.
730
Immunity Program
60. The Bureau will accept both oral and written proffers. In oral proffers, Bureau
staff will take detailed notes of the information. Applicants should take special care
to ensure that all information is clearly stated in a manner that allows sufficient
time for note-taking. Accuracy is critical since the Bureau relies on the information
to assess the immunity application, to develop its immunity recommendation and to
pursue its investigation.
61. The timing of a proffer can affect other steps in the Bureau’s investigation, such
as the execution of a search warrant or a coordinated enforcement action with an-
other jurisdiction. In certain circumstances and at its sole discretion, the Bureau
may require the applicant to make its proffer early within the 30 calendar day pe-
riod, and also provide documentary evidence and access to witnesses before the
proffer is completed. Any records provided or interview given to the Bureau at this
stage will be treated as confidential or privileged under the assurance that informa-
tion provided will not be used directly against the applicant for investigative pur-
poses.20 The Bureau will not return records to the applicant.
62. The applicant should alert the Bureau to any impediments to complying with
the Bureau’s required schedule as early in the process as possible to avoid prejudice
to the Bureau’s investigation. If an applicant cannot complete its proffer within 30
calendar days after an immunity marker has been granted then it should seek an
extension from the Deputy Commissioner or risk having its immunity marker can-
celled. Upon a request to the Deputy Commissioner to extend the proffer period
Guidelines
beyond 30 calendar days, the applicant should provide the reasons for the delay,
information on the status of its internal investigation, a detailed proposed work plan
for completing its proffer, and an update on the status of its cooperation with other
agencies.
63. The Deputy Commissioner will decide whether any delay in cooperation is rea-
sonable. A delay may be warranted in complex cases. However, the Bureau will not
accept delays solely because an applicant has commitments arising out of other
jurisdictions or because the applicant’s counsel is unavailable. Upon request, the
applicant must advise the Bureau, in a manner that does not waive any legal privi-
lege, of the progress of its internal investigation.
64. In certain circumstances, the Deputy Commissioner may request an undertaking
from the applicant to provide the information by a specified date, together with an
acknowledgement that its immunity marker will automatically lapse if the under-
taking is not fulfilled. In the absence of an extension to complete the proffer, delays
may result in the automatic lapsing of the applicant’s immunity marker.
65. There is no obligation on the Deputy Commissioner to notify the applicant that
its immunity marker has lapsed. Rather, it is the applicant’s responsibility to seek
an extension from the Deputy Commissioner.
20 See Part 4.3 in Chapter 3.3 (“Use Immunity” investigative assistance agreements) of the
PPSC Deskbook.
731
Immunity Program
66. The Deputy Commissioner may also cancel an immunity marker if the appli-
cant fails to meet any of the other requirements of the Immunity Program. Under
these circumstances, cancellation of an immunity marker will be made only after a
minimum of 14 calendar days’ notice to the applicant.
67. Applicants have a positive obligation to update their proffered information as
they become aware of either new or corrected information. This must be done
promptly and on an ongoing basis, regardless of whether the Bureau has specifi-
cally asked for the information. Further, applicants must provide timely responses
to any questions posed or information requests made by the Bureau.
68. The Bureau considers a proffer to be complete when it has received sufficient
information to make a comprehensive recommendation to the DPP that it issue a
GII for all conduct contemplated under the immunity marker. Applicants should
contact the Deputy Commissioner directly to modify the scope of the immunity
marker, if necessary.
69. If the Bureau concludes that the applicant demonstrates its capacity to provide
full cooperation and fully satisfy the requirements for obtaining immunity, it will
present all relevant proffered information, together with a recommendation regard-
ing the applicant’s eligibility under the Immunity Program, to the DPP.
70. A GII can be granted to a business organization or an individual. When a GII is
to be granted to an organization, individuals who have knowledge of or were in-
volved in the conduct and who are willing to cooperate with the terms and condi-
tions of the Immunity Program may be eligible for coverage under the GII.
71. Where the applicant is a recidivist then the DPP may assess whether granting
immunity to the applicant is in the public interest before issuing the GII.21
72. While the DPP will give the Bureau’s recommendation due consideration, the
DPP has final (independent) authority to decide whether it will enter into a GII.
While in the normal course the DPP will be able to make a decision on a GII based
on proffered information, there may be circumstances in which the DPP requests to
see records or that a witness or witnesses be interviewed in order to confirm that
there is a sufficient basis to grant a GII.
Step 3: — Grant of Interim Immunity: Full Disclosure and Cooperation

73. On the basis of the conduct described in the Bureau’s recommendation, which
is based on the proffered information, it is anticipated that the DPP will issue a GII
to the applicant. The purpose of the GII is to facilitate the Bureau’s investigation by
21 In its consideration of recidivism and the public interest the DPP ordinarily will only
consider previous offences under the Act that occurred or were judicially sanctioned within
10 years of the present application for Immunity. More generally, the DPP will consider the
proximity of the previous offence(s) and the proximity of entities (including affiliation) pre-
viously convicted to the present applicant and the conduct for which it seeks immunity. Fur-
ther, an application for leniency in sentencing will not be considered recidivism when at-
tached to an immunity plus request. However, prior grants of immunity or leniency may be
considered as such in subsequent applications under the Programs.
732
Immunity Program
formalizing the legal framework within which an applicant will disclose records
and make witnesses available.
74. The GII is a conditional immunity agreement that sets out the applicant’s ongo-
ing obligations that must be fulfilled in order for the DPP to finalize the immunity
agreement. The GII states who is covered by the agreement, how information pro-
vided by the immunity recipient will be treated and under what circumstances the
agreement can be revoked.
75. The applicant’s obligations under the GII are to provide complete, timely and
ongoing cooperation as well as full, complete, and truthful disclosure throughout
the Bureau’s investigation and any subsequent prosecution.
76. Both the applicant and the DPP must sign the GII. The Commissioner also
signs the agreement for the purpose of giving effect to the Commissioner’s rights
and obligations as set out in the agreement. Sample corporate and individual tem-
plate letters and agreements are included in Appendix 3.
77. The full disclosure process will be conducted on the understanding that neither
the Bureau nor the DPP will use the information against the applicant or the indi-
viduals included in the application, unless there is a breach of the terms and condi-
tions of the GII.
The Nature of the GII
Guidelines
78. If not disclosed in the course of the proffer process, the applicant will provide
the Bureau, on a “without prejudice” basis, the names and titles of the individuals
and affiliates it wishes to include in the GII. Relevant individuals and affiliates may
be added or removed, as necessary. Counsel should confirm that each identified
affiliate was implicated in the conduct and that each individual is prepared to admit
his or her knowledge of or participation in the unlawful conduct and their willing-
ness to cooperate in a complete, timely and ongoing manner.
79. All identified current directors, officers or employees, will be included under
the GII unless they fail to admit their knowledge of or participation in the unlawful
conduct or they fail to cooperate in a complete, timely and ongoing manner. Identi-
fied agents or former directors, officers or employees may be considered for inclu-
sion on a case by case basis.
80. The Bureau will recommend to the DPP that it remove from the GII those indi-
viduals who cannot or will not admit their knowledge of or participation in the
unlawful conduct as well as those individuals who have otherwise demonstrated an
unwillingness to cooperate in a complete, timely and ongoing manner.
81. When an individual is to provide evidence pursuant to a business organization’s
GII, he or she will be provided with a letter from the DPP that confirms that the
individual is covered under the business organization’s GII.
82. Sample corporate and individual template letters and agreements are included
in Appendix 3.
Disclosure
733
Immunity Program
83. After an applicant enters into a GII with the Commissioner and the DPP, the
applicant must complete the full disclosure process. The full disclosure process can
be expensive and time-consuming. The applicant must be prepared to dedicate the
resources necessary to support an expeditious and thorough investigation.
84. The Bureau requires full, complete, and truthful disclosure of all non-privileged
relevant information, including records responsive to the information checklist de-
scribed in Appendix 2, in the applicant’s possession, under its control or available
to it, wherever located, that, in any manner, relate to the unlawful conduct.
85. Accuracy of the information provided is critical to the Bureau. The Bureau re-
lies on this information to pursue its investigation of other participants to the al-
leged offence. An applicant that provides false or misleading information to the
Bureau or fails to fully cooperate in accordance with its obligations may face revo-
cation of its GII. As provided above, the applicant may also face criminal charges
under the Act or the Criminal Code.
86. At this stage, the topics addressed by an applicant will generally be the same as
those addressed at the proffer stage, but will be covered in greater detail and further
supported by records and testimonial evidence.
87. A schedule for disclosure should be established early in the immunity process
and production of records completed within the disclosure period, normally within
six months. Unwarranted delays or failure to provide access to witnesses arising
from other commitments, including any that arise from immunity or leniency appli-
cations in other jurisdictions, may be considered to be a breach of the GII.
88. Applicants are expected to take all lawful measures to secure the cooperation of
current directors, officers and employees, as well as any agents or former directors,
officers or employees covered by the GII, and to facilitate their ability to appear for
interviews and provide testimony in prosecutions at the applicant’s expense.
89. If a witness refuses to provide complete, timely and ongoing cooperation with
the investigation and any subsequent prosecution, the Bureau may make a recom-
mendation to the DPP that the witness be excluded from the GII and face prosecu-
tion. Typically, the Bureau will discuss the situation with the witness and provide
the witness with a reasonable opportunity to cooperate with the Bureau’s investiga-
tion and any subsequent prosecution before making such a recommendation to the
DPP. The DPP may, as a result of the Bureau’s recommendation, or on its own
initiative, exclude the witness from the GII.
90. An applicant will identify material witnesses and describe each witness’s
knowledge of the relevant conduct and/or the connection of the relevant conduct to
the Canadian marketplace as soon as practicable. Bureau officers ordinarily will
request to interview key witnesses as soon as possible.
91. An applicant should anticipate that witnesses will be asked about any criminal
activity, under any legislation, that can reasonably be expected to impact their cred-
ibility as a witness. This will include any individual’s previous convictions, pend-
ing charges and awareness of being the target of a criminal investigation. Such
disclosure may relate to criminal activity in Canada or abroad. Before offering im-
734
Immunity Program
munity, it is essential that the DPP be satisfied that the applicant disclosed all infor-
mation likely to affect its credibility.
92. Witness interviews may be audio or video recorded and may be taken under
oath. In the course of the investigation, the Bureau may require that a witness be
interviewed more than once. It is expected that sworn audio-video recorded inter-
views will be taken at an advanced stage of the investigation in order to support
recommendations to the DPP.22
93. If applicable, a witness’s statement may be used to impeach or cross-examine
the witness if their court testimony is materially inconsistent with the statement
previously provided to the Bureau.
94. Records likely relevant to a witness interview should be provided to the Bureau
by the applicant at least two weeks before an interview. Upon submission, the ap-
plicant is expected to explain the relevance and significance of the records in rela-
tion to the witness interview. Delay in submitting relevant records or providing
voluminous amounts of records with insufficient lead time could result in the
rescheduling of the witness interview or, in certain circumstances, constitute a
breach of the applicant’s cooperation obligations.
95. With respect to the disclosure of records, an applicant should consult with the
lead officer assigned to the matter in order to discuss the relevance and scope of
records to be produced and the form in which they will be provided. The Bureau
Guidelines
does not need or want records that are not relevant to the offence — “record
dumps” are not acceptable. An applicant is required to discuss its record production
with the Bureau on an ongoing basis and to raise any concerns or challenges early
in the process.
96. The Bureau typically requires that records be produced in electronic format.
Applicants must consult the Bureau’s Guidelines on the Production of Electroni-
cally Stored Information and discuss the general technical requirements with the
lead officer assigned to the file. In many instances, it will be necessary to arrange
for direct contact between the technical experts for each side to discuss any issues
associated with the transfer or receipt of records.
97. When requested by the Bureau or the DPP, the applicant is expected to produce
certified translated records and to arrange for a certified interpreter to accompany
its witnesses. Neither the Bureau nor the DPP will bear the cost of interpretation
with respect to oral evidence or translation with respect to records not provided in
one of Canada’s official languages.
98. Within 30 days of the GII being issued, claims of privilege over records other-
wise described in paragraph 84 must be disclosed to the Bureau along with the
specific legal privilege being claimed and the nature of the records over which the
22 Consistent with Part Three, the Bureau will take all reasonable measures to preserve the
confidentiality of the recording.
735
Immunity Program
privilege is being claimed.23 The Bureau will refer this information to the DPP. If
the DPP is not persuaded of the privilege claim’s sustainability24 the privilege
claim may be reviewed.
99. Where the parties are in agreement, an IC may be used to resolve a disagree-
ment regarding a privilege claim. Where use of an IC is not available or considered
appropriate, the assistance of a court may be sought to resolve a claim of privilege
including through the relevant provisions of the Actor the Criminal Code.
100. The Bureau expects applicants to deal with claims of privilege in good faith
and expeditiously.
101. The GII requires, when requested by the DPP, the applicant’s witnesses to
testify under oath or solemn affirmation in proceedings commenced by the DPP in
connection with the relevant conduct.
102. Non-compliance with the terms and conditions of the GII will provide the
DPP with grounds to revoke the GII. Under these circumstances, the applicant will
generally be given 14 days’ notice in order to provide it with the opportunity to
make itself compliant. Further information regarding failures to comply with the
GII can be found in paragraphs 106 to 108.
Step 4: — Final Grant of Immunity

103. The Bureau will make its recommendation to the DPP once the applicant has
satisfied its obligations under the GII. If after review, the DPP accepts the recom-
mendation, the DPP will finalize the grant of immunity.
104. All individuals identified in the GII who upheld the requirements of the Pro-
gram and were otherwise determined to be eligible for immunity, and all affiliates
demonstrated to be implicated in the unlawful conduct will be included in the final
grant of immunity.
105. The final grant of immunity will be communicated by way of a confirmation
letter from the DPP identifying, among other things, the individuals and affiliates
covered by it. While each case will be weighed on its own merits, the DPP ordina-
rily will not finalize the GII prior to:
1. the lapse of the statutory period to file a notice of appeal, when no party
seeks to appeal the trial court decision in the event of a criminal prosecution;
or
2. when the Commissioner and DPP have no reason to believe that further
assistance from the applicant could be necessary.
23 While no waiver of privilege is involved in the provision of this information, the descrip-
tion of the record must enable the DPP to understand the nature of the information over
which privilege is claimed and the basis upon which the privilege claim is founded.
24 It is not the DPP’s responsibility to determine the legality of any claim of privilege.
Claims of privilege will be determined in accordance with the laws of Canada.
736
Immunity Program
Failure to comply with the obligations of the Grant of Interim Immunity

106. Where the Bureau becomes aware that an applicant has not met the terms and
conditions set out in the GII, the Bureau may make a recommendation to the DPP
to revoke the GII, if warranted. Typically, the Bureau will discuss the situation with
the applicant and provide an opportunity for the applicant to address any shortfalls
in its cooperation as quickly as possible before making a recommendation for revo-
cation to the DPP.
107. As a result of the Bureau’s recommendation, or on its own initiative, the DPP
may revoke a GII where the applicant does not meet all of the terms and conditions
of the GII, and take further action against the applicant as appropriate in the cir-
cumstances. Where the DPP determines that the applicant has failed to fulfil the
terms and conditions set out in the GII, the DPP will provide a minimum of 14
calendar days’ notice to the applicant so that it has an opportunity to remedy its
failure before revoking the GII. The DPP’s policy on immunity, including the ap-
proach it will take when an agreement is breached, is set out in chapters 3.3 and 5.2
of the PPSC Deskbook.25
108. Revocation of a GII and other responses to non-compliance will affect only
the individual or organization that is not cooperating or that otherwise fails to com-
ply with the GII. An organization’s coverage under a GII can be revoked while its
cooperating directors, officers, employees or agents who are covered under the GII
retain their protection. Likewise, it is possible for an individual’s coverage under a
Guidelines
GII to be revoked while the organization remains covered.
Part two: The Leniency Program

Obtaining leniency26
109. The Leniency Program is intended to provide a predictable and transparent
manner to resolve liability for parties who offended the Act’s cartel provisions,
found in sections 45 to 49, including conspiracy and bid rigging, when an immunity
marker is not available.27
25 For further information, see Public Prosecution Service of Canada’s website.

26 As identified below, many of the principles that apply to the Immunity Program also
apply to the Leniency Program and the reader is pointed to the relevant portions. Where
identified, those principles apply to the Leniency Program mutatis mutandis, that is, subject
to necessary contextual considerations. To the extent of any inconsistency, the information
found in Part Two applies to the Leniency Program.
27 Individuals and business organizations seeking further information on lenient treatment
for matters related to deceptive marketing practices should contact the Deputy Commis-
sioner, Deceptive Marketing Practices Directorate. The Leniency Program is not available
for obstruction, destruction of records or any offence under the Act other than those identi-
fied in this paragraph.
737
Immunity Program
110. As previously provided, a party may contravene the Act even if it does not
supply products, directly or indirectly, into Canada (for example, market allocation
and cover bidding schemes).
111. A party may also apply to the Leniency Program on the basis of liability that
arises from sections 21, 22 or 22.2 of the Criminal Code.
112. A party implicated in domestic or international cartel activity may offer to
cooperate with the Bureau in exchange for lenient treatment in sentencing. A col-
laborative approach to resolving liability under the Leniency Program provides par-
ties with greater certainty and furthers the Bureau’s investigation by facilitating the
collection of evidence in a cost-effective manner.
Timing
113. The timeliness of a leniency application is important. When the Bureau has
referred the results of its investigation to the DPP for the purposes of a prosecution,
the Leniency Program will no longer be available to an individual or business
organization.
114. Further, the timing of a leniency applicant’s cooperation will affect its value to
the Bureau. Ordinarily, the credit to be recommended by the Bureau for the appli-
cant’s cooperation will be higher for early disclosure.
115. Individuals and organizations are encouraged to come forward and request a
leniency marker as soon as they believe they may be implicated in an offence. It is
not necessary for a party to have assembled a complete record of the information
required when contact is first made with the Bureau.
116. If a leniency applicant later determines it was not involved in an offence, it
should notify the Deputy Commissioner and withdraw its leniency marker.28
Eligibility
117. Subject to the requirements set out below, and consistent with fair and impar-
tial administration of the law, the Commissioner will recommend to the DPP that
leniency in sentencing be granted to a party in only the following circumstances:
a. it has terminated its participation in the cartel;29
28 A “leniency marker” is an acknowledgment given to a leniency applicant that records the

date and time of the application. It establishes the leniency applicant’s position in line in
relation to other individuals or organizations seeking to participate in the Leniency Program,
which also may be considered in the determination of the credit to be recommended for the
leniency applicant’s cooperation.
29 If there is a risk that stopping its conduct will alert the other participants to the Bureau’s
investigation, leniency applicants should raise with the Bureau any concerns they have about
what they can or cannot do to comply with this requirement and the possible impact that
non-compliance could have on the Bureau’s investigation at the earliest opportunity.
738
Immunity Program
b. it agrees to cooperate fully and in a timely manner, at its own expense, with
the Bureau’s investigation and any subsequent prosecution of the other cartel
participants by the DPP; and,
c. it demonstrates that it was a party to the offence;30 and,
d. it agrees to plead guilty.
118. A recommendation for leniency will only be made when the disclosed conduct
constitutes an offence under the Act and is supported by credible and reliable evi-
dence31 that demonstrates all elements of the offence.
Subsequent to the Leniency Application

119. The principles found in paragraphs 31 to 33 of the Immunity Program apply
equally in the context of the Leniency Program. Please refer to Part One of this
document.
Cooperation required
120. The principles found in paragraph 34 of the Immunity Program apply equally
in the context of the Leniency Program. Please refer to Part One of this document.
121. If a leniency applicant or any of the individuals within the scope of the leni-
ency applicant’s application engage in obstruction after requesting leniency, they
risk expulsion from the Leniency Program and prosecution for both obstruction and
Guidelines
the offence for which leniency was sought. Whether the applicant or any individu-
als will be expelled from the Leniency Program will be determined on a case-by-
case basis having regard to all of the circumstances in question.
122. Leniency applicants are expected to act in good faith with regards to their
participation in the Leniency Program, and their intention to plead guilty and re-
solve their legal liability. If a leniency applicant believes that it may have a poten-
tial legal defence in respect of its conduct that it intends to raise, it should decide as
soon as possible, prior to the leniency recommendation (Step 3 of the Leniency
Process), whether it intends to plead guilty to an offence and pursue its leniency
application. The Bureau does not expect that leniency applicants will complete the
proffer and disclosure processes only to raise potential legal defences after a leni-
ency recommendation has been made by the Bureau to the DPP, such that the re-
quirement to plead guilty is rendered ineffective for all of the proffered conduct.
30 A party to an offence is an individual or organization described in sections 21, 22 and

22.2 of the Criminal Code.
31 The Bureau will consider all evidence in its possession when making its assessment.
739
Immunity Program
Leniency in sentencing: determining the recommended fine

123. For business organizations the Bureau’s recommended fine to the DPP32 is
informed by numerous variables, including: an estimated base fine determined by
the relevant volume of commerce and an estimation of economic harm; aggravating
and mitigating factors, including any credit to be given for the existence of an ef-
fective corporate compliance program; and the value of the leniency applicant’s
cooperation to the Bureau’s investigation.33 Generally, the Bureau’s recommenda-
tion adopts the following framework:
Recommended fine = Base fine +/– (net effect of aggravating and mitigating factors) – leniency cooperation credit
The following paragraphs describe the elements considered in the course of devel-
oping a fine recommendation.
The Base Fine

124. To establish the base fine the Bureau first determines the relevant volume of
commerce affected by the cartel behaviour. Then the Bureau estimates overcharge
from the cartel activity that resulted from the conduct by using a proxy or readily
accessible compelling evidence demonstrative of a more appropriate measure of the
overcharge.
125. For the purpose of determining the relevant volume of commerce, the Bureau
may include an Applicant’s indirect sales34 into Canada. Such sales will be limited
to the volume of commerce related to the value of the relevant input into the end
product sold into Canada.
126. Where cartel members are penalized in another jurisdiction for the direct sales
that led to the indirect sales into Canada, the Bureau may consider, on a case-by-
case basis, whether the penalties imposed or likely to be imposed in the foreign
jurisdiction are adequate to address the economic harm in Canada resulting from
the indirect sales. Information regarding the supply chain will be particularly im-
portant in cases involving indirect sales.
32 The DPP has independent discretion to accept or reject the Bureau’s fine recommenda-
tion. The court will give the Crown’s submissions on a recommended fine due consideration
but the judge hearing the matter has the ultimate authority to determine the appropriate
penalty.
33 An additional credit may be available, for example, in the context of Immunity Plus,
discussed at paragraphs 141 to 143, below.
34 Indirect sales into Canada occur when a cartelized product is used as an input into an
intermediate or final product manufactured abroad that is subsequently sold to a purchaser in
Canada. Where the Applicant or the Bureau has evidence of indirect sales into Canada, the
Bureau expects or may request, as applicable, that an Applicant provide information in its
possession to assess the Applicant’s potential liability for such sales. The Bureau will, where
necessary, work with the Applicant to develop a feasible methodology to estimate the af-
fected volume of commerce associated with its indirect sales into Canada.
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Immunity Program
127. In the absence of readily accessible compelling evidence demonstrative of a

more appropriate measure of the overcharge, the Bureau uses a 20 percent proxy
comprised of two components to determine the base fine:
i. 10 percent of the affected volume of commerce in Canada as a proxy for the
overcharge from the cartel activity; and
ii. 10 percent of the affected volume of commerce in Canada for deterrence
and to ensure that the fine is sufficiently large so that it does not represent a
mere licensing fee or a cost of doing business.
128. In instances where 10 percent of a leniency applicant’s affected volume of
commerce is greater than the statutory maximum, the base fine will be the statutory
maximum.
129. The 10 percent proxy used to estimate the overcharge from cartel activity is
used when the leniency applicant does not provide or the Bureau cannot calculate,
on the basis of compelling evidence, the actual overcharge imposed by the cartel.
130. Where the evidence is readily accessible, compelling and does not require
modelling by the Bureau, the Bureau will consider submissions provided by leni-
ency applicants on a timely basis that demonstrate a lower overcharge. Delays aris-
ing from the leniency applicant’s determination of the overcharge will not be
accepted.
131. Where the Bureau has compelling evidence which indicates that a higher over-
Guidelines
charge is appropriate, it may use such information to determine the recommended
fine. The leniency applicant will be advised of the evidence indicating a higher
overcharge and will be provided with an opportunity to respond in a timely manner.
132. In any event, the determination of the overcharge will be expressed as a per-
centage of the affected volume of commerce.
133. Once the overcharge is determined, an additional 10% of the affected volume
of commerce in Canada, representing the deterrence proxy, will be added to that
amount.
134. In instances where a leniency applicant has no affected commerce attributable
to sales in Canada (for example due to a market allocation or cover bidding
scheme), the relevant proxy will not take into account any overcharge and the af-
fected volume of commerce will be estimated on the basis of the volume of com-
merce of the co-cartelist who sold in, from or into Canada. Where such data is
unavailable, the Bureau will estimate, on the basis of direct or circumstantial evi-
dence, the volume of commerce on the basis of the volumes contemplated at the
time the conspiracy or bid-rigging agreement was entered into.
135. Once the relevant volume of commerce is identified and the base fine deter-
mined, the Bureau will apply:
i. the net effect, if any, of aggravating and mitigating factors onto the base
fine; and subsequently,
ii. the leniency cooperation credit, and
iii. the immunity plus credit, if applicable.
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Immunity Program
Aggravating and Mitigating Factors

136. Aggravating and mitigating factors apply to both individuals and business or-
ganizations. For more information on aggravating and mitigating factors, and how
they factor into sentencing recommendations, see Part XXIII of the Criminal Code
and relevant sentencing case law.
137. The net effect of the aggravating and mitigating factors will be estimated as a
percentage of the base fine.
Credit for Credible and Effective Corporate Compliance Programs

138. Where the Bureau is satisfied that a compliance program in place at the time
the offence occurred was credible and effective, consistent with the approach set
out in the Bureau’s Bulletin on Corporate Compliance Programs, the Bureau will
treat the compliance program as a mitigating factor when making its recommenda-
tion to the DPP.
The Leniency Cooperation Credit (the LCC)

139. Every leniency applicant will be eligible for a leniency cooperation credit of
up to 50%. The amount of credit to be assigned will be based on the value of the
leniency applicant’s cooperation to the Bureau’s investigation.
140. The LCC will be determined having regard to the extent that the cooperation
added to the Bureau’s ability to advance its investigation to pursue other culpable
parties. This will take into account a number of factors. The timing of the leniency
application (relative to other parties in the cartel, as well as relative to the stage of
the Bureau’s investigation) is an important factor related to cooperation. Other rele-
vant factors include the timeliness of disclosure; the availability, credibility and
reliability of witnesses; the relevance and materiality of the applicant’s records; and
any other factor relevant to the development of the Bureau’s investigation into the
matter or any additional matter for which the party is eligible for “immunity plus”.
Immunity Plus, Evidence of a broader conspiracy and other considerations

141. If a leniency applicant discloses evidence of conduct constituting a further
criminal offence under the Act unknown to the Bureau, the leniency applicant may
be eligible for Immunity Plus status. If the leniency applicant meets the require-
ments set out in the Immunity Program regarding the newly-disclosed offence, the
Bureau will recommend that the DPP grant the applicant immunity from prosecu-
tion with respect to the newly-disclosed offence. In addition, for second-in and later
leniency applicants, the Bureau will recommend that any individuals qualifying
under the Leniency Program be afforded further lenient treatment in respect of the
offence for which leniency is being sought. In recognition of the leniency appli-
cant’s full cooperation in reporting the further offence, the Bureau will typically
recommend that an additional five to 10 percent be added to the applicant’s leni-
ency credit.
142. The size of the recommended Immunity Plus credit will depend on a number
of factors relating to the conduct for which immunity is available, including the
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Immunity Program
strength of the evidence provided by the applicant and the estimated significance of
the case brought forward by the applicant, measured in such terms as the affected
volume of commerce in Canada, the geographic scope of the conduct in question,
and the number of co-conspirator organizations and individuals involved in the
conduct in question. This credit will be applied only where all conditions of coop-
eration under the Immunity Program and Leniency Program are met by the
applicant.
143. If a leniency applicant’s cooperation reveals that the scope of the initial cartel
offence for which leniency is being sought is broader (e.g., in terms of the duration
of the offence) than previously identified by or known from the Bureau’s investiga-
tion or from other cooperating parties, the Bureau will not use that information
against the applicant when determining a leniency recommendation.
144. Other relevant considerations may affect the Bureau’s leniency recommenda-
tion, depending on the circumstances.
Impact of leniency on directors, officers, employees and agents35

145. At the request of the first-in leniency applicant that is a business organization,
the Bureau will recommend that no separate charges be laid against the Leniency
applicant’s current directors, officers or employees, and that they be included in the
plea agreement36 provided that such individuals admit knowledge of or participa-
Guidelines
tion in the unlawful conduct and are prepared to cooperate, in a timely fashion,
with the Bureau’s investigation in a complete and ongoing manner. Agents and
former directors, officers and employees implicated in the offence may qualify for
leniency provided that they admit knowledge of or participation in the unlawful
conduct and are prepared to cooperate with the Bureau’s investigation and any sub-
sequent prosecution.
146. Individuals to be considered for leniency must be identified by the leniency
applicant. The leniency applicant will provide the Bureau, on a “without prejudice”
basis, the names and titles of the individuals it wishes to include in the plea agree-
ment. Relevant individuals may be added or removed, as necessary, up to the appli-
cant’s plea being entered into court. Counsel should confirm that each individual is
prepared to admit his or her knowledge or participation in the unlawful conduct and
their willingness to cooperate in a complete, timely and ongoing manner.
147. No identified current director, officer or employee will be excluded from cov-
erage under the plea agreement for any reason other than a failure to admit his or
35 Leniency applicants implicated in an investigation that is not in the public domain must
approach individuals in the manner described in paragraphs 38 to 40 of the Immunity
Program.
36 A plea agreement is a private (non-public) agreement between the DPP and leniency ap-
plicant. Among other things, it identifies the unlawful conduct, the business organizations
and individuals covered by the agreement and the anticipated terms of a plea to be entered
into a court.
743
Immunity Program
her knowledge of or participation in the unlawful conduct or a failure to cooperate

in a complete, timely and ongoing manner.
148. A determination regarding agents and former directors, officers, and employ-
ees will be made on a case-by-case basis. For example, the value of the information
they can provide or whether they are currently employed by another party to the
offence may be considered.
149. The inclusion of an individual in the plea agreement is conditional upon the
individual upholding the terms of the plea agreement and the requirements of the
Leniency Program. Failure to uphold these requirements may result in the indivi-
dual losing his or her coverage. The Bureau will recommend to the DPP that it
remove from the plea agreement those individuals who cannot or will not admit
their knowledge of or participation in the unlawful conduct as well as those individ-
uals who have demonstrated an unwillingness to cooperate in a complete, timely
and ongoing manner.
150. When an individual is to provide evidence pursuant to a business organiza-
tion’s plea agreement, they will be provided with a letter from the DPP that con-
firms that the individual is covered under the business organization’s plea
agreement.
151. Where the first leniency applicant is an individual applying independently
(i.e., implicating his or her current or former employer), leniency will be accorded
in the same manner as if the individual were covered by an employer’s leniency
application. This approach is conditional upon an individual meeting the eligibility
requirements of the Leniency Program and providing complete, timely and ongoing
cooperation.
152. For the second and any subsequent leniency applicant, current and former di-
rectors, officers, employees and agents may be charged depending on their role in
the offence. When making its recommendation to the DPP as to whether a director,
officer, employee or agent should be charged, and any applicable fine or custodial
sentence, the Bureau will consider all of the available facts and circumstances in
respect of such an individual’s participation in the offence.
153. The Bureau takes into account a number of considerations when developing
sentencing recommendations for individuals. These include the role and extent of
involvement of the individual in the offence, the degree to which the individual
personally benefited from the offence (e.g., through advancement, salary increases,
performance bonuses, etc.), and whether the individual has been previously sanc-
tioned for offences in Canada or another jurisdiction.
The leniency process

154. The leniency process is predicated upon ongoing obligations owed by the leni-
ency applicant to the Bureau and DPP. A leniency applicant is required to provide
complete, timely and ongoing cooperation to the Bureau and DPP, at its own ex-
pense, throughout the Bureau’s investigation and any subsequent prosecution.
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Immunity Program
When the requirements are satisfied, the applicant will be eligible for lenient treat-
ment in sentencing for the offence(s) disclosed at the discretion of the DPP.37
155. The leniency application will follow a seven step process: initial contact
(marker request), proffer and limited disclosure, leniency recommendation, plea
agreement, full disclosure, court proceedings and ongoing cooperation. The appli-
cant will have 30 days from the date the marker was granted to complete its proffer
and is expected to complete its limited disclosure within 60 days from the comple-
tion of its proffer. Following the plea agreement, the leniency applicant will be
expected to complete its full disclosure within six months. Applicants who fail to
advance their matters in a timely manner may be expelled from the Leniency
Program.
Step 1: — Initial Contact (the Marker Request)

156. A “leniency marker” is the acknowledgement given to a leniency applicant
that records the date and time of a leniency applicant’s application to the Leniency
Program. It establishes the leniency applicant’s position in line in relation to other
individuals or organizations seeking to participate in the Leniency Program. The
leniency marker guarantees the leniency applicant’s position in line, subject to the
leniency applicant meeting all of the criteria of the Leniency Program.
157. Marker requests made in the course of a leniency application generally follow
Guidelines
the same principles and requirements described in paragraphs 56 through 67 of the
Immunity Program (see Part One). To the extent of any inconsistency, the informa-
tion found in Part Two applies to the Leniency Program.
158. Leniency markers are granted by the Deputy Commissioner, Cartels Director-
ate. Leniency applicants cannot rely on any alternative contact, for example, with a
Bureau officer or other Bureau employee, in respect of its application to obtain a
leniency marker. Further, the DPP does not accept leniency marker calls or grant
leniency markers.
159. An individual or an organization can request a leniency marker. Typically, a
leniency applicant’s counsel makes the contact with the Bureau. It is recommended
that leniency marker requests be made by telephone and that the leniency applicant
clearly state that it is making a leniency marker call. The leniency applicant should
ensure that all information is clearly stated and that it and the Deputy Commis-
sioner, are in agreement that a leniency marker has been requested, on the date and
time of the request, and on the description of the relevant product. As soon as pos-
sible following the request, usually within a few days, the Deputy Commissioner,
will advise the leniency applicant whether the requested leniency marker is availa-
ble and its position in line. At this time, the Deputy Commissioner will confirm
with the Applicant that, notwithstanding any confidentiality protections that form
part of the leniency program, neither the leniency applicant nor any of its cooperat-
37 The DPP has independent discretion to accept or reject the Bureau’s leniency recommen-
dation. However, the PPSC Deskbook provides that the PPSC should consult with the Bu-
reau and give due consideration to its recommendation.
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Immunity Program
ing directors, officers, employees, or agents will be treated as a confidential in-

former and will not be sheltered by informer privilege.
160. A leniency applicant that receives a leniency marker will be allowed four busi-
ness days to confirm its intention to participate in the Leniency Program. Once
participation is confirmed, the leniency applicant has 30 calendar days to provide a
proffer. That is, a detailed statement describing the unlawful conduct, its effects in
Canada and the supporting evidence, as described below in Step 2 of the Leniency
Process.
161. Upon issuance of the leniency marker, the applicant is required to identify
itself to the Deputy Commissioner or to the lead officer assigned carriage of the file
in order to facilitate the Bureau’s investigation.
Step 2: — Proffer and Limited Disclosure

162. Proffers made in the course of a leniency application generally follow the
same principles and requirements described in paragraphs 56 through 67 of the Im-
munity Program (see Part One) and Appendix 2. To the extent of any inconsis-
tency, the information found in Part Two applies to the Leniency Program.
163. The proffer will describe in detail the unlawful conduct, the leniency appli-
cant’s role in the offence(s) for which leniency is being sought and the effect of the
unlawful conduct in Canada. The leniency applicant must also outline all of the
supporting evidence and witnesses that it is aware of at that juncture.
164. The Deputy Commissioner will discuss timing requirements with the leniency
applicant during the leniency marker call. The timing of a proffer can affect other
steps in the Bureau’s investigation, such as the execution of a search warrant or
cooperation with another jurisdiction, where timing can be critical. In certain cir-
cumstances the Bureau may require the leniency applicant to make its proffer early
within the 30 calendar day period.
165. In preparing the proffer, leniency applicants are expected to conduct thorough
internal investigations to locate all relevant evidence, wherever located, whether in
Canada or elsewhere. Evidence may be in the form of records, witness testimony or
any other source of information that will assist the Bureau’s investigation.
166. Proffers are generally provided on a “without prejudice” basis by a leniency
applicant’s counsel and all information will be treated as settlement privileged.
During the proffer the leniency applicant must describe the unlawful conduct in
detail, including all parties to the offence and the full scope of the leniency appli-
cant’s criminal liability.
167. With respect to the party who received the first-in leniency marker, once its
proffer is complete, the Bureau ordinarily will seek to schedule and conduct inter-
views with key witnesses who are eligible to be included in the plea agreement as
described in paragraphs 145 to 151.
168. With respect to the second and subsequent leniency applicants, once its proffer
is complete, the Bureau ordinarily will seek to schedule and conduct an interview
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Immunity Program
with a key witness.38 The witness to be interviewed will be selected by the Bureau
after consulting with the leniency applicant and may be included in a plea agree-
ment and dealt with in the same manner as the first-in leniency applicant key
witnesses.
169. The Bureau and DPP place great importance and weight on witness inter-
views. Consequently, the interviews may be taken under oath and video recorded.
The evidence provided will be under settlement privilege and on a “use immu-
nity”39 basis and will not be used directly against the witness or the leniency appli-
cant providing the witness except as described in paragraphs 170 and 171.
170. The objectives of the interviews described in paragraphs 167 and 168 include:
1. obtaining evidentiary support for the allegations made in the course of the
proffer so that the Bureau can support its recommendations to the DPP, and
2. obtaining evidentiary support for court applications and prosecutions of
other parties to the offence. Admissions made in the course of the interview
may provide a basis for the agreed statement of facts to be used in support of
the applicant’s guilty plea.
171. If applicable, the witness’s statement may be used to impeach or cross-ex-
amine the witness if their court testimony is materially inconsistent with the state-
ment previously provided to the Bureau.
172. Where applicable, the leniency applicant must provide records relevant to an
Guidelines
interview of the witness. These records should be provided to the Bureau at least
two weeks before the interview. The leniency applicant is expected to explain the
relevance and significance of the records in relation to the witness. The records
may be provided on a settlement privilege and “use immunity” basis and will not
be used directly against the witness or the leniency applicant providing the witness,
except as described in paragraphs 170 and 171.40
173. The principles found in paragraphs 88 to 94 of the Immunity Program apply
equally in the context of interviews undertaken pursuant to the Leniency Program.
Please refer to Part One of this document. To the extent of any inconsistency, the
information found in Part Two applies to the Leniency Program.
174. The Bureau considers this stage of the Leniency Program to be complete when
it has received sufficient information to make a comprehensive leniency recom-
mendation to the DPP based on all available relevant information. Leniency appli-
cants should appreciate that the Bureau will be consulting various sources of infor-
mation, including existing immunity and other leniency applicants, with a view to
38 The Bureau may seek additional interviews when a single witness is incapable of describ-
ing in sufficient detail all conduct that is the subject of the leniency application.
39 For further discussions on “use immunity” see Chapter 4 of the PPSC Deskbook.
40 For greater certainty, leniency applicants who previously provided records to the Bureau
in response to a court order will not be permitted to submit the same documents on a “with-
out prejudice” basis under the Leniency Program, and the Bureau will be at liberty to use
them as it sees fit, at its sole discretion.
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Immunity Program
determining the facts relevant to an informed leniency recommendation as well as

the facts relevant to the operation of the cartel, more generally, before making a
leniency recommendation to the DPP. The Bureau expects that leniency applicants
will continuously provide any new information they become aware of and will pro-
vide timely responses to any questions the Bureau may have. The Bureau will not
make a leniency recommendation before the leniency applicant has substantially
completed its internal investigation.
175. When a leniency applicant does not demonstrate, or is not prepared to plead
guilty to, an offence, the Bureau will not make a leniency recommendation to the
DPP and will request that the leniency applicant withdraw its leniency marker. In
the event the leniency applicant does not withdraw its leniency marker, the leniency
marker will be cancelled by the Deputy Commissioner, following a minimum of 14
calendar days’ notice.
Step 3: — The Leniency Recommendation

176. After considering the relevant information, collected from the leniency appli-
cant and elsewhere, the Bureau will advise the DPP of the leniency applicant’s role
in the cartel. The Bureau will further identify and provide an assessment of the
cooperation and evidence that the leniency applicant has provided. On this basis,
the Bureau will provide its recommendation with respect to the terms of a plea.
177. The leniency recommendation will be based on all existing information as it
relates to the leniency applicant’s culpability. The decision to provide the DPP with
a leniency recommendation will not consider the likelihood of a co-conspirator
prosecution.
178. The DPP has independent discretion to accept or reject the Bureau’s leniency
recommendation. However, the PPSC Deskbook provides that the PPSC should
consult with the Bureau and give due consideration to its recommendation.41
Step 4: — The Plea Agreement

179. A plea agreement between the DPP and a leniency applicant establishes the
agreed terms and conditions under which the applicant will be recommended to be
provided with leniency in sentencing. The agreement sets out the applicant’s obli-
gations to, in a timely fashion, provide full, complete and truthful disclosure and
complete and ongoing cooperation throughout the Bureau’s investigation and any
subsequent prosecution. It also states who is covered by the agreement, how infor-
mation provided by the leniency recipient will be treated and under what circum-
stances the agreement can be revoked.
180. Plea discussions with the leniency applicant are conducted and led by the
DPP. The Bureau may attend to assist the DPP with any details about the leniency
41 The Bureau and PPSC recognize that in certain cases early participation by PPSC, in the
analysis of the evidence upon which a recommendation will be based, may be appropriate.
748
Immunity Program
applicant’s cooperation and the value of such cooperation to the Bureau’s

investigation.
181. The plea agreement reached with the DPP will be conditional on the complete,
timely and ongoing cooperation of the leniency applicant, and others covered under
its terms, with the ongoing investigation and any related prosecution. The plea
agreement will require the leniency applicant to provide disclosure of all non-privi-
leged information, records or other materials in its possession, under its control or
available to it, wherever located, that in any manner relate to the unlawful conduct
for which leniency is sought.
182. In order to reach a plea agreement, the DPP expects a sufficient evidentiary
foundation permitting it to determine that the proposed plea, including the proposed
leniency credit, is factually and legally sound and in the public interest.
183. In cases where the DPP determines that a leniency applicant’s claim regarding
ability to pay should be considered, the Bureau will assess the claim. Claims must
be supported by persuasive evidence before any reduction in the fine or an adjusted
payment schedule will be recommended by the Bureau to the DPP. An organization
will be required to provide financial information about its assets, liabilities, reve-
nues and equity.
184. To make a recommendation to the DPP, the Bureau may request that an inde-
pendent expert accountant review the organization’s financial information at the
Guidelines
expense of the leniency applicant. In the case of an individual, when a fine is rec-
ommended, the Bureau may require the individual to provide information about
their financial circumstances, including all sources of income, property, bank and
investment records, tax filings and other relevant records necessary to make a de-
termination as to his or her ability to pay.
185. Where the Bureau becomes aware, before a plea is entered in court, that a
leniency applicant does not meet or has not met the terms and conditions set out in
its plea agreement, the Bureau may make a recommendation to the DPP that the
applicant’s plea agreement be revoked. The Bureau will discuss the situation with
the leniency applicant and provide it an opportunity to address any shortfalls in its
conduct as quickly as possible before making a recommendation for revocation to
the DPP.
186. As a result of the Bureau’s recommendation, or on its own initiative, the DPP
may revoke a plea agreement, before a plea is entered in court, where the leniency
applicant does not meet all of the terms and conditions of that agreement, and take
further action against the leniency applicant as appropriate in the circumstances.
Where the DPP determines that the leniency applicant has failed to fulfil the terms
and conditions set out in its plea agreement, the DPP will provide a minimum of 14
calendar days’ notice to the leniency applicant so that it has an opportunity to rem-
edy its failure before revoking the plea agreement.
187. Revocation of a plea agreement will affect only the individual or organization
that is not cooperating or that otherwise fails to comply with the plea agreement.
An organization’s plea agreement can be revoked while its cooperating directors,
officers, employees or agents who are covered under the agreement retain their pro-
749
Immunity Program
tection. Likewise, it is possible for an individual’s coverage under a plea agreement

to be revoked while the organization remains covered.
188. A corporate and individual plea agreement is available from the DPP.
Step 5: — Full Disclosure

189. At the full disclosure stage, the topics addressed by a leniency applicant will
generally be the same as those addressed at the proffer stage, but will be covered in
greater detail. The Bureau will want to view and obtain copies of records and inter-
view witnesses. These interviews will ordinarily be made under oath and video re-
corded. The full disclosure process can be expensive and time-consuming, and the
leniency applicant must be prepared to dedicate the appropriate resources to sup-
port the Bureau’s interest in conducting an expeditious and thorough investigation.
190. A leniency applicant is expected to complete its production of information,
records, and other materials affording evidence to the Bureau as soon as possible
after the plea agreement is concluded and ordinarily within six months. Individuals
covered by the plea agreement will attend interviews and testify in prosecutions of
the other parties to the cartel, as required. Leniency applicants that are business
organizations must take all lawful measures to secure the cooperation of current
directors, officers, and employees, as well as any agents or former directors, of-
ficers and employees covered by the plea agreement.
191. Leniency applicants have a positive obligation to update all information
promptly as they become aware of either new or corrected information, records or
witnesses. This must be done on an ongoing basis regardless of whether or not the
Bureau has specifically asked for the information.
192. Accuracy of the information provided by leniency applicants is critical. The
Bureau relies on this information to pursue its investigation of other participants to
the alleged offence. Because timelines in an investigation can be critical, a leniency
applicant’s lack of timely cooperation can jeopardize the investigation.
193. A leniency applicant that provides false or misleading information to the Bu-
reau or fails to fully cooperate in accordance with its obligations under the plea
agreement may face revocation of the plea agreement. The leniency applicant may
also face a criminal charge of obstructing a Bureau inquiry or examination under
section 64 of the Act or of destroying or altering records under section 65 of the
Act. Providing false or misleading information can also lead to charges, including
perjury or obstruction, under the Criminal Code.
194. In addition to the above, disclosure made in the course of a leniency applica-
tion generally follows the same principles and requirements described in
paragraphs 83 through 101 of the Immunity Program. Please refer to Part One of
this document. To the extent of any inconsistency, the information found in Part
Two applies to the Leniency Program.
Step 6: — Court Proceedings: Entering the Plea

195. The DPP and counsel for the leniency applicant will make a joint sentencing
submission based on an Agreed Statement of Facts, which serves as the basis for
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Immunity Program
both the plea and recommended sentence. The Agreed Statement of Facts will set
out a sufficient factual basis to enable the court to make a determination that an
offence has been committed and that the recommended sentence is appropriate.
196. The Bureau will not recommend that the DPP delay the filing of the informa-
tion42 at the request of the leniency applicant unless there are compelling reasons to
do so and provided that the Bureau’s investigation or the DPPs prosecution of other
parties to the offence will not be impeded. The DPP has independent discretion
when deciding whether or not to delay the filing of an information.
197. The plea is public and is ordinarily taken in open court. The documents sub-
stantiating the plea are public as well.43 An Agreed Statement of Facts typically
will be filed with the court and oral or written representations will be provided by
the DPP to the court outlining considerations relevant to the plea, such as the nature
of the cartel offence, the applicant’s role in the offence and other relevant details,
including the relevant product, the duration of the cartel and the affected volume of
commerce in Canada.
Step 7: — Ongoing Cooperation and Testimony

198. The cooperation obligation owed by the leniency applicant and cooperating
individuals to the Bureau and DPP is not necessarily completed upon the entering
of a guilty plea into court and is extinguished in accordance with the terms of the
Guidelines
plea agreement negotiated with the DPP.
199. Generally, the cooperation obligation will be terminated by the DPP
following:
1. the lapse of the statutory period to file a notice of appeal, when no party
seeks to appeal the trial court decision in the event of a criminal prosecution;
or
2. when the Commissioner and DPP have no reason to believe that further
assistance from the leniency applicant or cooperating individuals could be
necessary.
Cancellation of leniency marker and withdrawal from the leniency

program
200. If a proffer is not completed within 30 calendar days from the date of the
marker, and if no extension has been granted, if disclosure has been insufficient or
where the Bureau is informed by the DPP that plea discussions have been termi-
42 An information is a formal criminal charge which initiates a criminal proceeding.

43 The plea agreement is a private agreement between the DPP and the leniency applicant. It
is not used to substantiate the plea and ordinarily is not released by the Bureau or the DPP
into the public domain. In certain contexts, a plea agreement may be disclosed, for example,
to the other cartelists as part of the Crown’s disclosure obligation in a prosecution of them or
if ordered by a court.
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Immunity Program
nated because the parties are unable to reach an agreement, the Bureau will cancel
the leniency applicant’s marker.
201. Should a leniency applicant have its marker cancelled or alternatively with-
draw from the Leniency Program at any time before concluding the plea agreement,
the applicant can be assured that information provided under the Leniency Program
will not be used directly against it and will be treated as either confidential or set-
tlement privileged, depending on the facts.
Legal Privilege
202. All information provided during the pre-plea agreement steps of the Leniency
Program, including witness interviews and records created for the purpose of the
proffer or plea negotiations and the plea agreement itself will be treated as settle-
ment privileged.
203. Information provided by the leniency applicant during the pre-plea agreement
steps may be used by the Bureau to further its investigation. This information will
not be used directly against the leniency applicant or its cooperating individuals
and will be treated by the Bureau as confidential. To this end, the Bureau’s policy
on confidentiality, as discussed in Part Three, will apply.
204. As part of the leniency applicant’s ongoing cooperation obligations, once the
plea agreement is concluded, all information provided by the leniency applicant
prior and pursuant to the plea agreement may be used by the Bureau in its investi-
gation and by the DPP in any subsequent prosecution against other parties to the
offence.
205. The Bureau may take the position that public interest privilege, as well as
other legal privileges, apply to information provided by the leniency applicant ei-
ther before or after the conclusion of the plea agreement, depending on the particu-
lar circumstances at hand.
Part three: — Matters common to the Immunity and Leniency programs

Status of witnesses
206. Cooperating parties are not confidential informers. Notwithstanding any repre-
sentations made by the Bureau or others about confidentiality of identity and infor-
mation, nothing in this program confers confidential informer status to a cooperat-
ing party. While the PPSC and the Bureau will keep the identity of a cooperating
party confidential in certain circumstances, as explained in this document, the iden-
tity of a cooperating party and any information that might tend to identify them are
not subject to informer privilege.
Treatment of information
Confidentiality
207. The Bureau’s policy on confidentiality with respect to immunity and leniency
applicants and the information they provide is over and above that provided in sec-
752
Immunity Program
tion 29 of the Act.44 The Bureau treats the identity of immunity and leniency appli-
cants or any information provided by the applicant as confidential, except where:
a. disclosure is required by law;
b. disclosure is necessary to obtain or maintain the validity of a judicial au-
thorization for the exercise of investigative powers;
c. disclosure is for the purpose of securing the assistance of a Canadian law
enforcement agency in the exercise of investigative powers;
d. the party has agreed to disclosure;
e. there has been public disclosure by the party;
f. disclosure is necessary to prevent the commission of a serious criminal of-
fence; or
g. in the case of information other than the immunity or leniency applicant’s
identity, where disclosure of such information is for the purpose of the admin-
istration or enforcement of the Act.
208. The operation of the confidentiality provisions found in paragraph 207 is fur-
ther qualified by the following paragraphs.
209. The Bureau will not disclose the identity of an immunity or leniency applicant
or the information provided by that applicant to any foreign law enforcement
agency without the consent of the applicant or unless required by law (e.g., in re-
Guidelines
sponse to an order of a Canadian court of competent jurisdiction).
210. Typically, the identity of an applicant will remain confidential until the appli-
cant enters a guilty plea into court or until charges are laid against other partici-
pants to the offence and disclosure of the DPP’s case to the accused is required.
211. Applicants should be aware, however, that their identity may be disclosed
before charges are laid if the Bureau relies on their evidence in an application to a
Canadian court for a search warrant, production order or judicial authorization of
any investigative measure. Recourse to search warrants and production orders,
among other things, can be of utmost importance to an investigation. To obtain
court authorizations, the Bureau must provide the court with information that there
are reasonable grounds to believe that an offence has been, or will be, committed.
The Bureau will rely on the information provided by the applicant to establish these
grounds.
44 Section 29 is the provision in the Act that deals with the communication of information in
the possession or control of the Bureau, whether it was provided voluntarily or obtained by
court order. The section prohibits communicating both the information and the identity of
any persons who provided it, subject to limited exceptions, which include:
1. to a Canadian law enforcement agency;
2. for the purposes of the administration or enforcement of the Act;
3. information that has been made public; and
4. information that has been authorized for communication by the person who provided
the information.
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Immunity Program
212. The Bureau will not allow an applicant’s interest in maintaining confidential-
ity to jeopardize the Bureau’s ability to effectively enforce the Act. However, the
Bureau will take all reasonable steps to ensure that this type of early disclosure
does not occur, except where necessary. The Bureau will draft applications to the
courts for authorization of investigative powers, referred to as an “Information to
Obtain” (ITO), in a manner designed to secure the protection of an applicant’s
identity, unless the Bureau is of the view that such drafting would not provide suffi-
cient grounds to obtain the authorization requested.
213. If the identity of the applicant cannot be kept confidential when the Bureau
applies for such authorization, it will request that the ITO, or relevant portion
thereof, be sealed until charges are laid. If a party challenges the sealing order
before a court to access the ITO, the Bureau will recommend to the DPP that it
resist the disclosure of the applicant’s identity and provide a redacted version of the
ITO, with the identity of the applicant kept confidential, unless the court orders
otherwise. Where it appears likely that disclosure is unavoidable, the Bureau will
advise the applicant as soon as possible.
International criminal anti-competitive activity

214. The timing of an approach to the Bureau can be critical to the options availa-
ble to a potential immunity applicant. A party considering an application for immu-
nity should appreciate that when the matter involves other countries, the Bureau
may be aware of the matter as a result of a foreign investigation before being
approached.
215. In matters involving multiple jurisdictions, a party should consider approach-
ing each jurisdiction’s competition law authority, or the authority responsible for
deceptive marketing practices, in an effort to secure its advantage under all applica-
ble immunity programs. A party whose business activities have a substantial con-
nection to Canada should contact the Bureau before, or immediately after, ap-
proaching foreign competition law authorities. The Bureau will not afford any
special consideration to an immunity or leniency applicant solely because it has
been granted immunity or another form of favourable treatment in another
jurisdiction.
216. As part of an applicant’s ongoing cooperation, absent compelling reasons, the
Bureau will expect the applicant to provide its consent in the form of a waiver
allowing communication of information with jurisdictions to which the applicant
has made similar applications for immunity or leniency. Such waivers shall be pro-
vided immediately and are expected to cover both substantive and procedural
information.
Private (Civil) Actions

217. Where an immunity or leniency applicant is a member of a joint defence
agreement in a civil action, it must be mindful that its first obligation is to provide
complete, timely and ongoing cooperation to the investigation and prosecution of
the offence for which immunity or leniency is sought.
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Immunity Program
218. Arrangements entered into in respect of a coordinated defence to a civil action

must be subordinate to the overriding commitment owed under the Immunity and
Leniency Programs and the terms of the immunity or plea agreement, as the case
may be. Further, immunity and leniency applicants must keep the Bureau and the
DPP apprised on an ongoing basis of the general status of any civil action in which
it is involved.
219. The Bureau has no interest in forestalling cooperation or in penalizing an im-
munity or leniency applicant for early disclosure or cooperation in a civil action. In
the event that it wishes to cooperate with a civil litigant in exchange for “credit” in
respect of any civil liability that may be owed, this interest should be communi-
cated as early as possible to the Bureau and the DPP. This will enable the Bureau
and the DPP to determine how the immunity or leniency applicant might provide
cooperation in the civil action without jeopardizing the Bureau’s criminal investi-
gation or the DPP’s prosecution. Failure by an immunity or leniency applicant to
advise the Bureau and the DPP of its activities in this regard may jeopardize the
applicant’s status under the Immunity or Leniency Programs.
220. The Bureau’s policy with respect to private actions under section 36 of the Act
is to disclose the identity of, or any information provided by, an immunity or leni-
ency applicant only in response to a court order. In the event of such an order, the
Bureau will take all reasonable steps to protect the confidentiality of the informa-
tion and the identity of the applicant, including seeking protective court orders.
Guidelines
Appendix 1: — Criminal provisions of the Competition Act
Part VI of theAct prohibits under criminal sanction: bid rigging, agreements be-
tween competitors to fix prices, allocate markets or restrict production, false or
misleading representations and deceptive marketing practices. For operational and
statistical purposes, those offences found in sections 45 to 49 (Table 1) are treated
separately from the criminal false or misleading representations and deceptive mar-
keting practices provisions found in sections 52 through 55.1 (Table 2).
Table 1 — Provisions of the Competition Act under the

responsibility of the Deputy Commissioner, Cartel Directorate
Section On or after March 12, 2010: Conspiracies, agreements or arrange-
45 ments between competitors or potential competitors to fix prices,
allocate markets or restrict the supply of a product. Prior to March
12, 2010: Conspiracies, combinations, agreements or arrangements
to lessen competition unduly in relation to the supply, manufacture
or production of a product.
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Immunity Program
Section Conspiracies, agreements or arrangements that are implemented in

46 Canada as a result of directives, instructions, intimations of policy
or other communication from a person outside of Canada, in a
position to direct or influence the policies of the corporation, for
the purpose of giving effect to a conspiracy, and that, if entered
into in Canada, would have been in contravention of section 45.
Section Bid rigging, when two or more persons agree that one party will
47 refrain from bidding in a call for tenders, or when there is collu-
sion in the submission or withdrawal of bids, unless such actions
are made known to the tendering authority.
Section Conspiracies, combinations, agreements or arrangements that limit

48 unreasonably the opportunities, terms or participation of a player
or competitor in professional sports, or to limit unreasonably the
opportunity to negotiate with or play for a professional team or
club.
Section Subject to a number of exceptions explained in section 49(2), any

49 agreement between two or more federal financial institutions with
respect to interest rates or charges on deposits or loans, service
charges to customers, kinds of services provided, or the person or
classes of persons to whom a loan or other service will be provid-
ed or withheld.
Table 2 — Provisions of the Competition Act under the

responsibility of the Deputy Commissioner, Deceptive Marketing
Practices Directorate
Paragraph Knowingly or recklessly making representations that are false
52(1)(a) or misleading in a material respect for the purpose of promot-
ing a product or any business interest.
Section 52.01 Knowingly or recklessly send or cause to be sent false or mis-

leading representations pertaining to the sender, the subject
matter, the content or the locator information in an electronic
message or locator for the purpose of promoting a product or
any business interest.
Section 52.1 While engaging in telemarketing (the practice of using interac-

tive telephone communications for the purpose of promoting
the supply of a product or any business interest):
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Immunity Program
• failing to disclose the identity of the person on whose

behalf the communication is being made, the purpose
of the communication and the nature of the product
or business being promoted;
• making a representation that is false or misleading in

a material respect;
• requiring any advance payment as a condition for re-

ceiving a prize that has been, or supposedly has been,
won in a contest or game;
• failing to provide adequate and fair disclosure of the

value of the prizes and of any fact that materially
affects the chances of winning;
• offering a gift (or any product at less than fair market

value) as an inducement to buy another product, with-
out fairly disclosing the value of the gift; or
Guidelines
• requiring payment in advance for any product offered
at a price grossly in excess of its fair market value.
Section 53 Sending or causing to be sent a document or notice if the

document or notice gives the general impression that the recipi-
ent has won or will win a prize or other benefit, and if the
recipient is also asked or given the option to pay money, incur
a cost or do anything that will incur a cost.
Section 54 Supplying a product at a price that exceeds the lowest of two
or more prices that are clearly shown on the product, its
container, wrapper or display mount or on any in-store adver-
tisement. This provision does not actually prohibit the existence
of two or more prices, but requires that the product be offered
for sale at the lowest price depicted.
Section 55 Making representations relating to compensation under a mul-
tilevel marketing plan without fair, reasonable and timely dis-
closure of compensation actually received (or likely to be
received) by typical participants in the plan.
Section 55.1 Establishing, operating, advertising or promoting a pyramid-
selling scheme, defined as a multilevel marketing plan under
which:
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Immunity Program
• a participant pays for the right to receive compensa-

tion for recruiting another participant;
• a participant is required to purchase a specified
amount of product (other than an amount bought at
the seller’s cost price for the purpose of facilitating
sales);
• a participant is supplied with an unreasonable amount
of product; or
• there is no right to return the product in saleable con-
dition on reasonable terms, or the participant is not
informed of the right to return the product.
Appendix 2: — Information Checklist
Topics to be covered in a proffer may include those set out below. This list is not
intended to be exhaustive and the information required will depend on the facts and
the relevant offence. For example, evidence of an undue lessening of competition
will be required in the case of a conspiracy where some of the conduct pre-dates
March 12, 2010 (when the current conspiracy provision came into force). Other
information, such as the use of deceptive telemarketing scripts, is likely to be rele-
vant only in the context of false or misleading representations and deceptive mar-
keting practices.
The Parties
• a general description of the applicant and the other parties implicated in the
conduct;
• the individuals involved in the offence;
• business ownership structures, including affiliations;
• the applicant’s share of, and role in, the market;
• membership in, or involvement with, trade or other associations;
• the nature and level of involvement in the offence;
The Product
• the physical and technical characteristics of the product;
• quality claims;
• the end use and value of the product;
The Industry
• a general description of the industry and how it functions;
• how pricing in the industry works;
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Immunity Program
• the regulatory framework;

• the existence and nature of contracts;
• how the product is supplied;
• customer or supplier countervailing power;
• use of targeted lists by telemarketers;
Market Information
• other market participants (domestic or foreign) and their market shares;
• a description of key customers in Canada and elsewhere;
• the geographic locations of sellers and customers;
The Conduct
• a description of the conduct, including the nature and timing of communica-
tions among competitors or corporate policies or procedures designed to
deceive customers;
• the time period of the conduct;
Guidelines
• the geographic scope of the conduct;
• the representations involved and the medium;
• monitoring or enforcement measures utilized in carrying out the offence;
• whether any agreements or arrangements were set out in writing;
• whether other participants continue to engage in the conduct;
• measures taken to conceal the conduct or the identity of the participants;
• measures taken to launder money;
• re-loading (or re-victimizing) customers;
• selling of customer lists;
• targeting vulnerable groups;
• abusive or threatening behaviour relating to the offence;
Impact of the Conduct

• the volume of commerce affected in Canada, whether directly or indirectly,
along with a description of the methodology, data and sources used to make or
support that determination;
• pricing and other effects;
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Immunity Program
• whether customers or potential customers are aware of the conduct or have

complained about it;
• any product substitutes and their price levels (including transportation costs);
• barriers to entry into the market;
• costs for a customer to switch to an alternate product;
Evidentiary Process
• a general description of: the steps taken in the applicant’s internal investiga-
tion including information related to how the applicant became aware of the
unlawful conduct and its internal response; as well as the steps taken to inves-
tigate the conduct, including the names of all individuals interviewed and a
summary of their statements and responses relevant to the offence;
• a general description of witnesses who the applicant believes could testify
about the conduct and the anticipated nature of their evidence;
• a description of all relevant records available to the applicant at that point in
time;
• identification of any relevant records or witnesses that are unavailable and the
reasons for the unavailability, including specifics of any claimed privilege, ev-
idence destruction or attempts to obstruct the Bureau’s investigation;
International Issues
• whether the applicant has made, or will make, an application for immunity or
leniency in other jurisdictions and the identity of those jurisdictions; and
Private Actions
• whether the applicant is a defendant in any civil actions in Canada, or else-
where, respecting the conduct and the general status of any such civil actions.
Required if the section 45 conduct pre-dates March 12, 2010, and the offence
requires proof of undueness:
Prior to March 12, 2010, section 45 of the Act prohibited agreements that prevent
or lessen competition unduly or enhance prices unreasonably. A conspiracy under
the previous provision must meet the threshold of undueness or unreasonableness
before it can be considered a criminal offence. It is the combination of market
power and behaviour likely to injure competition that makes a lessening of compe-
tition undue.
The determinants of market power include such factors as market shares, the num-
ber of competitors and the concentration of competition, barriers to entry, geo-
graphical distribution of buyers and sellers, differences in the degree of integration
among competitors, product differentiation, countervailing power and cross-elastic-
ity of demand. When parties engage in particularly injurious behaviour contrary to
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Immunity Program
the former section 45 of the Act, such as price-fixing, liability may be triggered
even when market power is not considerable.
Market information provided by an applicant at the proffer stage enables the Bu-
reau to assess the likely impact of the agreement and whether it has caused an
undue lessening of competition. Applicants are required to address the issue, but
are not required to demonstrate decisively to the Bureau that an undue lessening of
competition has occurred in the case of conduct that pre-dates March 12, 2010.
Appendix 3: — Template documents
Company — Model letter — Grant of Interim Immunity (GII)

PRIVILEGED & CONFIDENTIAL
Date
Addressee (Counsel)
Dear [lnsert]:
RE: Grant of Interim Immunity — ABC Corporation [insert name]
I am writing further to ABC Corporation’s [ABC] application to the Commissioner
of Competition [the Commissioner] for immunity pursuant to the Immunity and
Leniency Programs under the Competition Act [Immunity Program] of the Compe-
Guidelines
tition Bureau of Canada [the Bureau].
I understand that ABC applied for and was granted a first-in marker by the Bureau
in relation to anticompetitive conduct believed to be a violation of the Competition
Act [the Act]. Since that time, ABC has provided the Bureau with additional infor-
mation in relation to the anticompetitive conduct.
Based on the information received to date, the Commissioner has recommended to
the Director of Public Prosecutions [DPP] that ABC and its current directors, of-
ficers and employees receive an Grant of Interim Immunity [GII] in order to facili-
tate the Bureau’s investigation of the anticompetitive conduct and as a step toward
a grant of final immunity from prosecution under the Act for potential offences
associated with the anticompetitive conduct in question.
Based on the information gathered to date, and subject to the further collection of
information and analysis, the anticompetitive conduct is described as:
. . . that ABC . . . [describe conduct]
The basis for the Commissioner’s recommendation is that ABC appears to meet the
eligibility requirements of the Immunity Program, including that:
(a)(i) the Bureau was unaware of an offence, and ABC was the first to disclose
all of the elements of the offence; OR
(a)(ii) the Bureau was aware of an offence, and ABC was the first to come
forward before the Bureau gathered sufficient evidence to warrant a referral of
the matter to the DPP;
(b) ABC has terminated its participation in the unlawful activity;
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Immunity Program
(c) ABC has represented that it has not coerced others to be a party to the
unlawful activity; and
(d) ABC has provided information that demonstrates it was a party to the an-
ticompetitive conduct believed to be a contravention of the Act.
Upon review of the Bureau’s recommendation, the DPP is prepared to offer ABC a
GII at this time. A draft agreement that reflects the GII accompanies this letter.
A copy of the Immunity Program is attached as Appendix 1 to the GII and serves as
further background to the operation of the Immunity Program including the expec-
tations and obligations associated with the GII.
As is indicated in these materials, should ABC accept and commit to the GII, the
following conditions will apply to ABC.
a. ABC agrees to provide Bureau investigators with full disclosure of all non-
privileged information, evidence or records in ABC’s possession, under its
control or available to it, wherever located, that, in any manner, relate to the
anticompetitive conduct.
b. ABC’s production of information and records within the disclosure process
will be timely and will be completed within a schedule established between
the Bureau and ABC, unless an exception to the schedule is warranted.
c. ABC accepts its obligation to bear the cost of collecting and producing in-
formation and records within the disclosure process and is prepared to dedi-
cate appropriate resources to meet the timely production of this information.
d. ABC will take all lawful measures to secure the cooperation of current di-
rectors, officers and employees, as well as any agents or former directors, of-
ficers or employees specifically covered by this agreement, and to facilitate
the ability of these individuals to appear for interviews and provide testimony
in judicial proceedings at ABC’s expense. (The individuals covered by this
GII to date are described in Appendix 2 to the GII.)
e. ABC will cooperate with Bureau investigators as part of furthering the Bu-
reau’s investigation of the anticompetitive conduct. This cooperation includes
providing truthful and accurate information, a willingness to assist investiga-
tors locate information that is most pertinent, as well as an obligation to up-
date information and evidence promptly when ABC becomes aware of either
new or corrected information, records or witnesses.
f. Unless made public by the DPP or the Commissioner, or as may be ordered
by a Canadian court of competent jurisdiction, ABC shall not disclose the ex-
istence of this GII, nor the substance of the matter under investigation, without
the consent of the DPP.
ABC should understand that no current director, officer or employee, and no agent
or former director, officer or employee covered by the GII is a confidential in-
former. Notwithstanding any representations made by the Bureau or others about
confidentiality of identity and information, nothing in the GII Agreement or the
Immunity Program confers confidential informer status to cooperating individuals.
While the PPSC and the Bureau will keep the identities of these individuals confi-
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Immunity Program
dential in certain circumstances, as explained in the GII Agreement, the identities

of these individuals and any information that might tend to identify them are not
subject to informer privilege.
ABC should also understand that providing false or misleading information to the
Bureau, failure to cooperate in accordance with its obligations under the GII and/or
noncompliance with the terms and conditions of the GII or obligations under the
Immunity Program, including eligibility requirements, can lead to revocation of the
GII and possible charges under the Act or the Criminal Code.
Should ABC accept and commit to the GII, the Bureau and the DPP will not use
any of the information disclosed by ABC against ABC or the individuals listed in
Appendix 2, unless ABC or the individual has been found to be ineligible for im-
munity or has otherwise failed to comply with the GII or obligations under the
Immunity Program.
Additionally, no current director, officer or employee, and no agent or former di-
rector, officer or employee covered by this GII, will be carved out of the GII for
any reason other than a failure to admit its knowledge of or participation in the
anticompetitive conduct, a failure to cooperate in a complete, timely and ongoing
manner or actions which lead to the revocation of a GII.
This offer of a GII is also premised on ABC having the intention to meet the obli-
gations associated with the agreement in order to receive a grant of final immunity.
Guidelines
The DPP will provide a grant of final immunity to ABC once ABC has satisfied all
of its obligations under the GII, including, if necessary, testifying in court
proceedings.
As indicated, should ABC agree with the content of this letter and its obligations as
an immunity applicant, the DPP is prepared to provide ABC with an IGI as a step
toward ABC receiving final immunity from prosecution under the Competition Act
for the anticompetitive conduct described in the agreement.
Yours very truly,
PPSC counsel
Company — Model GII agreement
THIS AGREEMENT IS BETWEEN:
HER MAJESTY THE QUEEN IN RIGHT OF CANADA,
as represented by the
DIRECTOR OF PUBLIC PROSECUTIONS OF CANADA
— and —
ABC CORP [insert name]
This document sets out the terms and conditions of an agreement between Her Maj-
esty the Queen in right of Canada, as represented by the Director of Public Prosecu-
tions of Canada [DPP] and ABC Corp ABC governing the grant of immunity from
prosecution under the Competition Act [the Act].
This grant of interim immunity [GII] follows an application to the Commissioner of
Competition [the Commissioner] for immunity pursuant to the Immunity and Leni-
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Immunity Program
ency Programs under the Competition Act [Immunity Program] (attached as Appen-
dix 1) of the Competition Bureau of Canada [the Bureau].
This grant of interim immunity relates to anticompetitive conduct contrary to . . .
section(s) . . . of the Act with respect to . . . [brief outline of conduct that is the
subject of the application].
This agreement is conditional and depends upon ABC satisfying the terms and con-
ditions set out below. This interim immunity will become final when ABC has met
its obligations under this agreement and written acknowledgement of such has been
issued by the DPP.
The parties agree and undertake as follows:
1. Definitions: In this agreement,
“anticompetitive conduct” means . . . [definition/description of anticom-
petitive conduct and its time frame that is covered by the immunity
agreement];
“cooperation” means complete, timely and ongoing cooperation, at
ABC’s own expense throughout, with the DPP and the Commissioner in
connection with the investigation of the anticompetitive conduct and in
any proceedings that may be instituted by the DPP in relation to the an-
ticompetitive conduct, and as more fully described in paragraphs 3
through 5 of this agreement;
“confidential information” means this agreement and any information
that in any way relates to the investigation of the anticompetitive
conduct;
“disclosure”, as used in paragraphs 3 through 5 of this agreement, means
full, complete, frank and truthful disclosure of all non-privileged infor-
mation, evidence or records relating to the anticompetitive conduct;
“person in breach” means any person granted interim immunity by this
agreement who has failed to fulfill any one of the terms or conditions set
out in this agreement; and
“ABC” means [explanation of company and affiliates who are covered
by this agreement — as appropriate].
2. Representations: ABC represents that:
a. it has reported to the Commissioner and the DPP that it has engaged in
the anticompetitive conduct;
b. it has taken effective steps to terminate its participation in the anticom-
petitive conduct;
c. it has not coerced others to be a party to the anticompetitive conduct;
and
d. it has revealed to the DPP and the Commissioner any and all conduct
of which it is aware that may constitute an offence under the Act.
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Immunity Program
3. Cooperation and Disclosure: ABC has provided and shall continue to pro-
vide as necessary disclosure and cooperation to the DPP and the Commis-
sioner, including, but not limited to:
a. all non-privileged information, evidence and records in its possession,
under its control or available to it, wherever located, whether or not re-
quested by the DPP or the Commissioner, that in any manner relate to the
anticompetitive conduct. Before providing the information, evidence and
records, ABC will consult with the Commissioner with respect to the rel-
evance and scope of such information, evidence and records and the form
in which such information, evidence and records will be provided to the
Commissioner;
b. using all measures, lawful where taken, and as authorized by the Bu-
reau as required, to secure the cooperation of the current and former di-
rectors, officers, employees, and agents of ABC, and encouraging such
persons to provide voluntarily to the DPP and the Commissioner all of
their non-privileged evidence, information and records that in any man-
ner relate to the anticompetitive conduct;
c. facilitating, in accordance with the conditions set out in the Immunity
Program, the ability of current and former directors, officers, employees,
and agents to appear for interviews and to provide testimony in connec-
tion with the anticompetitive conduct as the DPP or the Commissioner
Guidelines
may require, at the times and places designated by the DPP or the Com-
missioner; and
d. revealing any and all conduct of which it becomes aware that may
constitute an offence under the Act.
4. Corporate Immunity: Having considered the recommendation of the
Commissioner and, after an independent review pursuant to the policy of the
DPP as set out in the PPSC Deskbook, conditional upon:
a. the veracity of the representations contained in paragraph 2 above; and
b. the disclosure by and cooperation of ABC as required pursuant to this
agreement;
c. ABC’s compliance with the terms and conditions of this GII;
the DPP grants ABC interim immunity from prosecution under the Act in re-
spect of the anticompetitive conduct.
5. Immunity of Individuals Covered by Corporate Interim Immunity
Agreement: Subject to the veracity of the representations contained in para-
graph 2, the DPP grants to the current and former directors, officers, employ-
ees, and agents of ABC identified in the GII for ABC [“individuals” and sin-
gularly “individual”] immunity from prosecution under the Act in respect of
the anticompetitive conduct conditional on their admission of their knowledge
of and participation in the anticompetitive conduct and on their continuing co-
operation with the DPP or the Commissioner as outlined in the Immunity Pro-
gram and any further correspondence between those parties.
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Immunity Program
6. If at any time the Commissioner or the DPP should determine that ABC did
not, or does not as required, satisfy the terms and conditions of this agreement
and its immunity under this agreement is revoked, individual protection under
this agreement will continue on the following basis: the individual has com-
plied and continues to comply fully with his/her obligations under this agree-
ment; no grounds exist to revoke the individual’s immunity; and, the indivi-
dual’s immunity has not been previously revoked pursuant to paragraph 14 of
this agreement.
7. Confidentiality: No individuals covered by this agreement are confidential
informers. The identities of the individuals and any information that might
tend to identify them are not subject to informer privilege.
8. The DPP and the Commissioner shall not disclose to any third party the
identity of ABC or the individuals covered by this agreement, except where:
b. disclosure is necessary to obtain or maintain the validity of a judicial
authorization for the exercise of investigative powers;
c. disclosure is necessary for the purpose of securing the assistance of a
Canadian law enforcement agency in the exercise of investigative
powers;
d. ABC has agreed to disclosure;
e. there has been public disclosure by ABC;
f. disclosure is necessary to prevent the commission of a serious criminal
offence; or
g. in the case of information other than ABC’s identity, where disclosure
of such information is for the purpose of the administration or enforce-
ment of the Act.
9. The DPP and the Commissioner shall not disclose to any third party infor-
mation obtained from ABC or individuals covered by this agreement, subject
only to the exceptions listed above.
10. The DPP and the Commissioner shall not disclose the identity of ABC or
individuals covered by this agreement, nor the information obtained from
ABC or the individuals, to any foreign law enforcement agency without the
consent of ABC, which consent will not be unreasonably withheld.
11. Unless made public by the DPP, or the Commissioner, or as required by
law, neither ABC nor any individual covered by this agreement shall disclose
confidential information to any third party, without the consent of the DPP,
which consent will not be unreasonably withheld. Where disclosure is required
by law, ABC or the individual shall give notice to and consult with the DPP
prior to disclosure.
12. If any third party seeks to compel disclosure of confidential information
from any party to this agreement, or any individual covered by this agreement,
the party or individual from whom the information is sought shall give prompt
notice to the parties to this agreement, and shall take all reasonable steps to
766
Immunity Program
resist disclosure unless the parties to this agreement consent to such

disclosure.
13. Failure to Comply with the GII: The parties agree that full compliance
with all the terms and conditions in this agreement by any person granted in-
terim immunity by it, is fundamental to the agreement. The parties also agree
that the accuracy and veracity of all representations required by this agreement
by any person granted interim immunity by it is a condition of and fundamen-
tal to the agreement. Non-compliance with any of the aforementioned terms
and conditions of this agreement by any person granted interim immunity by it
constitutes a breach of the agreement by that person, which may result in revo-
cation of interim immunity for that person or such other remedy as the DPP
may determine.
14. Grounds for Revocation: If the DPP determines that ABC has misrepre-
sented itself with respect to any of its representations under paragraph 2, has
not provided the cooperation and disclosure required in paragraph 3, or has not
complied with any other terms and conditions of this agreement, the DPP may
revoke the interim immunity granted to ABC after fourteen (14) days prior
written notice to counsel for ABC, and, absent exigent circumstances, will
provide counsel with an opportunity to meet within the aforementioned four-
teen (14) days with the DPP regarding the potential revocation.
15. If the DPP determines that an individual granted interim immunity by this
Guidelines
agreement:
a. has not provided the cooperation and disclosure required in paragraph
3;
b. has not complied with any other terms and conditions of this agree-
ment or an individual GII;
c. continued to participate in the anticompetitive conduct after ABC noti-
fied the individual to cease doing so; or
d. obstructed, or attempted to obstruct justice;
the DPP may revoke the interim immunity granted to the individual after four-
teen (14) days prior written notice to counsel for the individual and to counsel
for ABC and, absent exigent circumstances, will provide counsel with an op-
portunity to meet within the aforementioned fourteen (14) days with the DPP
regarding the potential revocation.
16. Following revocation of interim immunity for a breach of this agreement,
as described in paragraphs 13 through 15 above, the DPP may take such action
against the person whose immunity has been revoked as the DPP considers
appropriate, including prosecution under the Act or the Criminal Code. In any
such action the DPP may use, in any way, any information, evidence, record,
statement or testimony provided by any person at any time after the applica-
tion for immunity and any evidence of any kind derived directly or indirectly
from such information, evidence, record, statement or testimony provided. For
greater certainty, any privilege that may apply in respect of any information,
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Immunity Program
evidence, record, statement or testimony provided is deemed waived upon rev-

ocation of immunity.
17. Use of Statements: No information, evidence, record, or statement pro-
vided during an interview by any person granted interim immunity pursuant to
this agreement will be used in evidence against that person in any proceedings
undertaken by or on behalf of the DPP, except where the person granted in-
terim immunity:
a. subsequently gives in any trial, hearing, or judicial proceeding (includ-
ing any proceeding in which the person is an accused) evidence that is
materially different from the statement given in an interview;
b. is charged with perjury, giving contradictory evidence, fabricating evi-
dence or obstructing justice; or
c. has had its interim immunity revoked after a breach of this agreement.
18. Nothing in this agreement affects the right of the DPP or the Commis-
sioner to use any information, evidence, record, statement or testimony pro-
vided by any person under this agreement in order to discover or acquire other
information, evidence, or records from another source.
19. Privilege and Jurisdiction: Nothing in this agreement, or any action taken
pursuant to it, shall constitute:
a. except for the deemed waiver mentioned in paragraph 8, a waiver of
any privilege, by any party to this agreement; or
b. a submission to the jurisdiction of the Canadian courts by any person
granted interim immunity by this agreement who is not present in Can-
ada, except for the purpose of this agreement and proceedings related to
the enforcement of this agreement.
20. Applicable Law: This agreement shall be construed in accordance with
the laws of Canada.
21. Entire Agreement: This agreement constitutes the entire agreement be-
tween the DPP and ABC, including the individuals covered by this agreement,
and supersedes all prior understandings or agreements, if any, whether oral or
written, relating to the subject matter of this agreement.
22. Notices: Any notice required to be given under this agreement is deemed
to be validly given if in writing and by pre-paid registered mail, courier deliv-
ery, facsimile transmission or electronic mail (e-mail) transmission to:
a. The Director of Public Prosecutions of Canada
Attention: Public Prosecution Service of Canada, Competition Law Sec-
tion
160 Elgin Street
Place Bell Canada, suite 1400
Ottawa, ON K1A 0H8
CANADA
768
Immunity Program
Attention:
[Insert name and contact information]
b. The Commissioner of Competition
Attention: Senior Deputy Commissioner
Cartels and Deceptive Marketing Practices Branch
20th Floor, Place du Portage, Phase I
50 Victoria Street, Gatineau, QC, K1A 0C9
CANADA
Attention:
c. ABC
Attention: [Insert name and contact information]
d. With copy to:
Attention: Counsel for ABC
Counsel for ABC
[Address of ABC]
23. Execution in Counterparts: This agreement may be executed in
Guidelines
counterparts.
24. The Commissioner Joins in this Agreement: The Commissioner joins in
this agreement solely for the purposes of giving effect to his rights and obliga-
tions as set out in paragraphs 7 to 11 and paragraph 17.
25. Authority and Capacity: The DPP, ABC and the Commissioner each re-
present and warrant to the others that the signatories to this agreement on be-
half of each party to it have all the authority and capacity necessary to execute
this agreement and to bind the respective parties to it. ABC represents that it
has had an opportunity to consult Canadian legal counsel in respect of this
agreement.
The signatories acknowledge the full and voluntary acceptance of the foregoing
terms and conditions.
Dated at ..........
this.......... day of.........., 20...........
Her Majesty the Queen in right of Canada as this represented by the Director of
Public Prosecutions of Canada
Per: ..........
Counsel for the Public Prosecution Service of Canada
Dated at ..........
this.......... day of.........., 20...........
The Commissioner of Competition
.......... The Commissioner of Competition
769
Immunity Program
Dated at ..........
this.......... day of.........., 20...........
ABC
Per:..........
[insert name and title of signing officer]
.......... Counsel to ABC
Employee — Model letter — Confirmation of coverage from company GII
Addressee (Counsel)
RE: Grant of Interim Immunity — INDIVIDUAL [insert name] covered by com-
pany GII
I am writing to clarify the immunity protection being made available to you as well
as to outline the conditions and expectations associated with this grant of interim
immunity.
ABC Corporation [ABC] applied to the Commissioner of Competition [the Com-
missioner] for immunity pursuant to the Immunity and Leniency Programs under
the Competition Act [Immunity Program] of the Competition Bureau of Canada
[the Bureau].
The anticompetitive conduct that formed the basis of ABC’s application for immu-
nity is described as:
. . . that ABC . . . [describe conduct]
Based on the information received to date, the Commissioner recommended to the
Director of Public Prosecutions [DPP] that ABC receive an Grant of Interim Immu-
nity [GII] in order to facilitate the Bureau’s investigation of the anticompetitive
conduct and as a step toward a grant of final immunity between the DPP and ABC.
Based on the Bureau’s recommendation and the information provided to date by
ABC, the DPP has provided to ABC a GII (a copy of which accompanies this let-
ter) that also applies to any current director, officer or employee of ABC as well as
any agent, former director, officer or employee covered by the GII.
ABC is bound by the requirements of its GII and those of the Immunity Program. A
copy of the Immunity Program is attached as Appendix 1 to the GII and serves as
further background to the operation of the Immunity Program, including the expec-
tations and obligations associated with the GII.
Taking into consideration the recommendation of the Commissioner as well as in-
formation and representations made on your behalf, the DPP is prepared to extend
an assurance that the protections afforded to ABC pursuant to the GII will be ex-
tended to you in order to facilitate further disclosure and investigation of the an-
ticompetitive conduct.
Accordingly, this is to advise you that the DPP is granting you a GII from prosecu-
tion under the Competition Act [the Act]in respect of the anticompetitive conduct
[specify time frame].
770
Immunity Program
This GII is conditional upon you providing information and evidence to the Bureau
and the DPP, and discharging all of the obligations described in the lmmunity Pro-
gram. For greater clarify, conditions associated with your GII include that you:
i. provide the Bureau with full disclosure of all non-privileged information,
evidence or records in your possession, under your control or available to you,
wherever located, that, in any manner, relate to the anticompetitive conduct;
ii. make yourself available for interviews (which may be under oath and taped
or videotaped) in Canada at the expense of [ABC] upon the request of the
Commissioner or the DPP at the times and places designated by the Commis-
sioner or DPP;
iii. cooperate with Bureau investigators as part of furthering the Bureau’s in-
vestigation of the anticompetitive conduct. This cooperation includes provid-
ing truthful and accurate information, a willingness to assist investigators lo-
cate information that is most pertinent, as well as an obligation to update
information and evidence promptly should you become aware of either new or
corrected information or records;
iv. not disclose the existence of this GII, nor the substance of the matter under
investigation, without the consent of the DPP, unless this information is made
public by the DPP or the Commissioner, or as may be ordered by a Canadian
court of competent jurisdiction; and
Guidelines
v. when requested by the DPP, testify completely and truthfully under oath or
solemn affirmation in proceedings commenced by the DPP in connection with
the anticompetitive conduct being reported and, if applicable, attorn to the ju-
risdiction of Canada for purposes of service of any court process related to
proceedings commenced by the DPP relating to the anticompetitive conduct
being reported.
You are not a confidential informer. Notwithstanding any representations made by
the Bureau or others to you about confidentiality of your identity and information,
nothing in the GII Agreement or the Immunity Program confers confidential in-
former status to you. While the PPSC and the Bureau will keep your identity confi-
dential in certain circumstances, as explained in the GII Agreement, your identity
and any information that might tend to identify you are not subject to informer
privilege.
Providing false or misleading information to the Bureau, failure to cooperate in
accordance with your obligations under the GII, or non-compliance with the terms
and conditions of the GII can lead to revocation of this GII and possible charges
under the Act or the Criminal Code.
The DPP confirms that neither the DPP nor the Commissioner will use any infor-
mation you provided against you in any criminal proceeding unless there has been a
failure to comply with the terms of this letter, the obligations under the lmmunity
Programor the GII provided to ABC, or as a result of actions that otherwise led to
the revocation of this GII.
771
Immunity Program
For further clarity, the commitments made in this letter have no application to any
offences or other liabilities arising under the Criminal Code or any other federal,
provincial, or municipal law.
Without limiting the generality of the foregoing, this agreement does not provide
immunity from prosecution for perjury, the giving of contradictory evidence or ob-
struction of justice, if the circumstances warrant, or for conduct other than that dis-
closed to the Commissioner and the DPP.
If at any time the Bureau or the DPP should determine that [ABC] has not satisfied
the requirements of its GII with the DPP, and therefore is no longer entitled to the
protections encompassed by that GII, your protections will continue, so long as you
continue to fully comply with your obligations.
Should ABC receive a grant of final immunity, unless specifically notified to the
contrary, the grant of final immunity will apply to you as well, without the need for
subsequent agreement.
Should you agree with the content of this letter and the conditions that will apply to
you if granted a GII, the DPP is prepared to provide you with interim immunity.
Please endorse the acknowledgement below and return an endorsed copy of this
letter back to me.
Yours very truly,
PPSC Counsel
I request the DPP grant me the protections of the GII that has been granted to ABC.
I admit knowledge of (participation in) the anticompetitive conduct and am aware
of the expectations and obligations associated with a GII.
I understand that I am not a confidential informer. I understand that my identity and
any information that might tend to identify me are not subject to confidential in-
former privilege. Specifically, I understand that my identity and any information
that might tend to identify me will be disclosed in the circumstances set out in
paragraph 8 of the GII agreement.
..........
Applicant
..........
Date
Individual — Model letter — GII
PRIVILEGED & CONFIDENTIAL
Date
Addressee (Counsel)
RE: Grant of Interim Immunity — INDIVIDUAL A [insert name]
I am writing further to A [insert name]’s IND A application to the Commissioner
of Competition [the Commissioner] for immunity pursuant to the Immunity and
Leniency Programs under the Competition Act [Immunity Program] of the Compe-
tition Bureau of Canada [the Bureau].
772
Immunity Program
I understand that you are acting as counsel for IND A with respect to [his/her]
application for immunity. It is also my understanding that IND A applied for and
was granted a first-in marker by the Bureau in relation to anticompetitive conduct
believed to be a violation of the Act. Since that time, IND A has provided the
Bureau with additional information in relation to the anticompetitive conduct.
Based on the information received to date, the Commissioner has recommended to
the Director of Public Prosecutions [DPP] that IND A receive a Grant of Interim
Immunity [GII] in order to facilitate the Bureau’s investigation of the anticompeti-
tive conduct and as a step toward a grant of final immunity from prosecution under
the Act for potential offences associated with the anticompetitive conduct in
question.
Based on the information gathered to date, and subject to the further collection of
information and analysis, the anticompetitive conduct is described as:
. . . that IND A . . . [describe conduct]
The basis for the Commissioner’s recommendation is that IND A appears to meet
the eligibility requirements of the Immunity Program, including that:
(a)(i) the Bureau is unaware of an offence, and IND A is the first to disclose
all of the elements of the offence; OR
(a)(ii) the Bureau is aware of an offence, and IND A is the first to come for-
ward before the Bureau gathers sufficient evidence to warrant a referral of the
Guidelines
matter to the DPP;
(b) IND A has terminated [his/her] participation in the unlawful activity;
(c) IND A has represented that [he/she] did not coerce others to be party to the
unlawful activity and is not the sole beneficiary of the illegal activity in Can-
ada; and
(d) IND A has provided information that demonstrates [he/she] was a party to
the anticompetitive conduct believed to be a contravention of the Act.
Upon review of the Bureau’s recommendation, the DPP is prepared to offer IND A
a GII at this time. A draft agreement that reflects the GII accompanies this letter.
A copy of the Bureau’s Immunity Program is attached as an Appendix 1 to the GII
and serves as further background to the operation of the Immunity Program includ-
ing the expectations and obligations associated with the GII. I also highlight some
of these points for purposes of clarity.
Should IND A accept and commit to the GII, the following conditions will apply to
IND A.
a. IND A agrees to provide the Bureau with full disclosure of all non-privi-
leged information, evidence or records in IND A’s possession, under [his/her]
control or available to him/her, wherever located, that, in any manner, relate to
the anticompetitive conduct.
b. IND A’s production of information and records within the disclosure pro-
cess will be timely and will be completed within a schedule established be-
773
Immunity Program
tween the Bureau and IND A, unless an exception to the schedule is

warranted.
c. IND A accepts its obligation to bear the cost of collecting and producing
information and records within the disclosure process.
d. IND A will cooperate with the Bureau as part of furthering the Bureau’s
investigation of the anticompetitive conduct. This cooperation includes pro-
viding truthful and accurate information, a willingness to assist investigators
locate information that is most pertinent, as well as an obligation to update
information and evidence promptly when IND A becomes aware of either new
or corrected information or records.
e. Unless made public by the DPP or the Commissioner, or as may be ordered
by a Canadian court of competent jurisdiction, IND A shall not disclose the
existence of this GII, nor the substance of the matter under investigation, with-
out the consent of the DPP.
IND A should understand that [he/she] is not a confidential informer. Notwith-
standing any representations made by the Bureau or others about confidentiality of
identity and information, nothing in the GII Agreement or the Immunity Program
confers confidential informer status to [him/her]. While the PPSC and the Bureau
will keep the identity of Ind A confidential in certain circumstances, as explained
in the GII Agreement, the identity of Ind A and any information that might tend to
identify [him/her] are not subject to informer privilege.
IND A should also understand that providing false or misleading information to the
Bureau, failure to cooperate in accordance with its obligations under the GII and/or
noncompliance with the terms and conditions of the GII or obligations under the
Immunity Program, including eligibility requirements, can lead to revocation of the
GII and possible charges under the Act or the Criminal Code.
Should IND A accept and commit to the GII, neither the Bureau nor the DPP will
use any of the information disclosed by IND A against [him/her], unless [he/she]
has been found to be ineligible for immunity or has otherwise failed to comply with
the GII or obligations under the Immunity Program.
This offer of a GII is also premised on IND A having the intention to meet the
obligations associated with the agreement in order to receive a grant of final immu-
nity. The DPP will provide a grant of final immunity to IND A once [he/she] has
satisfied all of its obligations under the GII, including, if necessary, testifying in
court proceedings.
Should IND A agree with the content of this letter and [his/her] obligations as an
immunity applicant, the DPP is prepared to provide IND A with a GII as a step
toward [him/her] receiving final immunity from prosecution under the Actfor the
anticompetitive conduct described in the agreement.
Yours very truly,
PPSC counsel
I admit knowledge of (participation in) the anticompetitive conduct.
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Immunity Program
I am aware of the expectations and obligations associated with a GII and intend to
meet those in order to receive a grant of final immunity.
I understand that I am not a confidential informer. I understand that my identity and
any information that might tend to identify me are not subject to informer privilege.
Specifically, I understand that my identity and any information that might tend to
identify me will be disclosed in the circumstances set out in paragraph 6 of the GII
agreement.
..........
IND A
..........
Date
Individual — Model GII Agreement
THIS AGREEMENT IS BETWEEN:
HER MAJESTY THE QUEEN IN RIGHT OF CANADA,
as represented by the
DIRECTOR OF PUBLIC PROSECUTIONS OF CANADA
— and —
INDIVIDUAL A
This document sets out the terms and conditions of an agreement between Her Maj-
Guidelines
esty the Queen in right of Canada, as represented by the Director of Public Prosecu-
tions of Canada [DPP] and INDIVIDUAL A IND A governing the grant of interim
immunity from prosecution under the Competition Act [the Act].
This grant of interim immunity [GII] follows an application to the Commissioner of
Competition [the Commissioner] pursuant to the Competition Bureau’s Immunity
and Leniency Programs under the Competition Act [Immunity Program] (attached
as Appendix 1).
This grant of immunity relates to anticompetitive conduct contrary to . . . section(s)
. . . of the Act with respect to . . . [brief outline of conduct in that is the subject of
the application].
This agreement is conditional and depends upon IND A satisfying the terms and
conditions set out below. This interim immunity will become final when IND A
has met its obligations under this agreement and written acknowledgement of such
has been issued by the DPP.
The parties agree and undertake as follows:
1. Definitions: In this agreement,
“anticompetitive conduct” means . . . [definition/description of anticom-
petitive conduct and its time frame that is covered by the immunity
agreement];
“cooperation” means complete, timely and ongoing cooperation, at IND
A’s own expense throughout, with the DPP and the Commissioner in
connection with the investigation of the anticompetitive conduct and in
775
Immunity Program
any proceedings that may be instituted by the DPP in relation to the an-
ticompetitive conduct, and as more fully described in paragraphs 3
through 4 of this agreement;
“confidential information” means this agreement and any information
that in any way relates to the investigation of the anticompetitive
conduct;
“disclosure”, as used in paragraphs 3 through 4 of this agreement, means
full, complete, frank and truthful disclosure of all non-privileged infor-
mation, evidence or records relating to the anticompetitive conduct.
2. Representations: IND A represents that:
a. he/she has reported to the Commissioner and the DPP that he/she has
engaged in the anticompetitive conduct;
b. he/she has taken effective steps to terminate his/her participation in the
anticompetitive conduct;
c. he/she has not coerced others to be a party to the anticompetitive con-
duct; and
d. he/she has revealed to the DPP and the Commissioner any and all con-
duct of which he/she is aware that may constitute an offence under the
Act.
3. Cooperation and Disclosure: IND A has provided and shall continue to
provide as necessary disclosure and cooperation to the DPP and the Commis-
sioner, including, but not limited to:
a. all non-privileged information, evidence and records in his/her posses-
sion, under his/her control or available to him/her, wherever located,
whether or not requested by the DPP or the Commissioner, that in any
manner relate to the anticompetitive conduct. Before providing the infor-
mation, evidence and records, IND A will consult with the Commissioner
with respect to the relevance and scope of such information, evidence and
records and the form in which such information, evidence and records
will be provided to the Commissioner; and
b. revealing any and all conduct of which he/she becomes aware that may
constitute an offence under the Act.
4. Immunity: Having considered the recommendation of the Commissioner
and, after an independent review pursuant to the policy of the DPP as set out
in the PPSC Deskbook, conditional upon:
a. the veracity of the representations contained in paragraph 2 above; and
b. the disclosure by and cooperation as required pursuant to this agree-
ment; and
c. IND A’s compliance with the terms and conditions of this agreement;
the DPP grants IND A interim immunity from prosecution under the Act in
respect of the anticompetitive conduct.
776
Immunity Program
5. Confidentiality: IND A and any information that might tend to identify

them are not subject to informer privilege.
6. The DPP and the Commissioner shall not disclose to any third party the
identity of IND A, except where:
b. disclosure is necessary to obtain or maintain the validity of a judicial
authorization for the exercise of investigative powers;
c. disclosure is necessary for the purpose of securing the assistance of a
Canadian law enforcement agency in the exercise of investigative
powers;
d. IND A has agreed to disclosure;
e. there has been public disclosure by IND A;
f. disclosure is necessary to prevent the commission of a serious criminal
offence; or
g. in the case of information other than IND A’s identity, where disclo-
sure of such information is for the purpose of the administration or en-
forcement of the Act.
7. The DPP and the Commissioner shall not disclose to any third party infor-
mation obtained from IND A subject only to the exceptions listed above.
Guidelines
8. The DPP and the Commissioner shall not disclose the identity of IND A nor
the information obtained from IND A to any foreign law enforcement agency
without the consent of IND A, which consent will not be unreasonably
withheld.
9. Unless made public by the DPP, or the Commissioner, or as required by
law, IND A shall not disclose confidential information to any third party,
without the consent of the DPP, which consent will not be unreasonably with-
held. Where disclosure is required by law, IND A shall give notice to and
consult with the DPP prior to disclosure.
10. If any third party seeks to compel disclosure of confidential information
from any party to this agreement, the party from whom the information is
sought shall give prompt notice to the parties to this agreement, and shall take
all reasonable steps to resist disclosure unless the parties to this agreement
consent to such disclosure.
11. Failure to Comply with this Agreement: The parties agree that full com-
pliance with all the terms and conditions in this agreement is fundamental to
the agreement. The parties also agree that the accuracy and veracity of all rep-
resentations required by this agreement by IND A is a condition of and funda-
mental to the agreement. Non-compliance with any of the aforementioned
terms and conditions of this agreement by IND A constitutes a breach of the
agreement which may result in revocation of interim immunity for IND A or
such other remedy as the DPP may determine.
777
Immunity Program
12. Grounds for Revocation: If the DPP determines that IND A has misrep-
resented itself with respect to any of its representations under paragraph 2; has
not provided the cooperation and disclosure required in paragraph 3; has not
complied with any other terms and conditions of this agreement; or, ob-
structed, or attempted to obstruct justice; the DPP may revoke the interim im-
munity granted to IND A after fourteen (14) days prior written notice to IND
A (or counsel for IND A) and, absent exigent circumstances, will provide IND
A (or counsel) with an opportunity to meet within the aforementioned fourteen
(14) days with the DPP regarding the potential revocation.
13. Following revocation of interim immunity for a breach of this agreement,
as described in paragraphs 10 and 11 above, the DPP may take such action
against IND A as the DPP considers appropriate, including prosecution under
the Act or the Criminal Code. In any such action the DPP may use, in any
way, any information, evidence, record, statement or testimony provided by
IND A at any time after the application for immunity and any evidence of any
kind derived directly or indirectly from such information, evidence, record,
statement or testimony provided. For greater certainty, any privilege that may
apply in respect of any information, evidence, record, statement or testimony
provided is deemed waived upon revocation of immunity.
14. Use of Statements: No information, evidence, record, or statement pro-
vided during an interview by IND A will be used in evidence against him/her
in any proceedings undertaken by or on behalf of the DPP except where IND
A:
a. subsequently gives in any trial, hearing, or judicial proceeding (includ-
ing any proceeding in which IND A is an accused) evidence that is mate-
rially different from the statement given in an interview;
b. is charged with perjury, giving contradictory evidence, fabricating evi-
dence or obstructing justice; or
c. has had its immunity revoked after a breach of this agreement.
15. Nothing in this agreement affects the right of the DPP or the Commis-
sioner to use any information, evidence, record, statement or testimony pro-
vided by IND A under this agreement in order to discover or acquire other
information, evidence, or records from another source.
16. Privilege and Jurisdiction: Nothing in this agreement, or any action taken
pursuant to it, shall constitute:
1. except for the deemed waiver mentioned in paragraph 6, a waiver of
any privilege, by any party to this agreement; or
2. a submission to the jurisdiction of the Canadian courts by IND A, who
is not present in Canada, except for the purpose of this agreement and
proceedings related to the enforcement of this agreement. [if applicable]
17. Applicable Law: This agreement shall be construed in accordance with
the laws of Canada.
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Immunity Program
18. Entire Agreement: This agreement constitutes the entire agreement be-
tween the DPP and IND A, and supersedes all prior understandings or agree-
ments, if any, whether oral or written, relating to the subject matter of this
agreement.
19. Notices: Any notice required to be given under this agreement is deemed
to be validly given if in writing and by pre-paid registered mail, courier deliv-
ery, facsimile transmission or electronic mail (e-mail) transmission to:
• The Director of Public Prosecutions of Canada
Attention: Public Prosecution Service of Canada, Competition Law Sec-
tion 160
Elgin Street
Place Bell Canada, suite 1400
Ottawa, ON K1A 0H8
CANADA
Attention:
a. The Commissioner of Competition
Attention: Senior Deputy Commissioner
Guidelines
Cartels and Deceptive Marketing Practices Branch
50 Victoria Street, 20th Floor, Place du Portage, Phase I
Gatineau, QC K1A 0C9
CANADA
Attention:
b. IND A
Attention:
c. With copy to:
Attention: Counsel for IND A
Counsel for IND A
[Address of IND A]
20. Execution in Counterparts: This agreement may be executed in
counterparts.
21. The Commissioner Joins in this Agreement: The Commissioner joins in
this agreement solely for the purposes of giving effect to his rights and obliga-
tions as set out in paragraphs 5 to 9 and paragraph 15.
22. Authority and Capacity: The DPP, IND A and the Commissioner each
represent and warrant to the others that the signatories to this agreement on
behalf of each party to it have all the authority and capacity necessary to exe-
779
Immunity Program
cute this agreement and to bind the respective parties to it. IND A represents
that it has had an opportunity to consult Canadian legal counsel in respect of
this agreement.
The signatories acknowledge the full and voluntary acceptance of the foregoing
terms and conditions.
Dated at ..........
this.......... day of.........., 20...........
Her Majesty the Queen in right of Canada as this represented by the Director of
Public Prosecutions of Canada
Per:..........
Counsel for the Public Prosecution Service of Canada
Dated at ..........
this.......... day of.........., 20...........
The Commissioner of Competition
.......... The Commissioner of Competition
Dated at ..........
this.......... day of.........., 20...........
IND A
Per:..........
[insert name of IND A]
780
LENIENCY PROGRAM*
September 2010
Preface
This Bulletin sets out the factors and principles that the Bureau considers in making
a recommendation to the Public Prosecution Service of Canada (“PPSC”) for leni-
ent treatment in the sentencing of individuals or business organizations accused of
criminal cartel offences under the Competition Act (“Act”).
A transparent and predictable Leniency Program complements the Bureau’s Immu-
nity Program and supports the effective and efficient enforcement of the Act. Indi-
viduals and business organizations are more likely to come forward, cooperate, and
plead guilty (rather than litigate) when they are aware of the relevant leniency con-
siderations and when they are confident that the Bureau will follow them in its
leniency recommendations to the PPSC. In developing the Leniency Program, we
Guidelines
have considered the significant input received from our stakeholders and the best
practices of foreign jurisdictions that have adopted leniency policies.
While the Bureau cannot guarantee specific sentencing outcomes in cartel cases,
this Bulletin sets out the principles that the Bureau will follow in developing leni-
ency recommendations to the PPSC. I am confident that the Information Bulletin
on the Leniency Program will advance the transparency and predictability of the
Bureau’s enforcement policies and practices, while promoting the effective deter-
rence of criminal cartel activity in Canada.
Melanie L. Aitken
Interpretation
This Bulletin establishes the Bureau’s general approach to applying the Leniency
Program in respect of criminal cartel offences under the Competition Act (“Act”).
This Bulletin supersedes all previous statements of the Commissioner or other offi-
cials of the Competition Bureau regarding the administration of the Leniency Pro-
* Bulletin: Immunity and Leniency Programs under the Competition Act, (March 15, 2019;
Web Page Date Modified: 2019-03-15), Innovation, Science and Economic Development
781
Leniency Program
gram, and should be read in conjunction with the Leniency Program’s Frequently
Asked Questions.
This Bulletin cannot provide a comprehensive review of all issues that may arise in
a given situation pertaining to a leniency applicant. The guidelines in this Bulletin
are not intended to restate the law or to constitute a binding statement of how the
Commissioner or the PPSC will exercise discretion in a particular situation. The
enforcement and prosecutorial decisions of the Commissioner and the PPSC re-
spectively, and the ultimate resolution of issues, will depend on the particular cir-
cumstances of the matter in question.
The Bulletin and FAQs are living documents and represent a general framework.
Principles may evolve or change and exceptional circumstances will be taken into
account. The Bureau may revisit certain aspects of this Bulletin in the future in
light of experience, changing circumstances and court decisions.
This Bulletin does not provide legal advice. Readers should refer to the Act when
questions of law arise and obtain legal advice if necessary. If a party wishes to seek
a binding written opinion from the Commissioner on the applicability of the Act to
proposed business conduct, it may do so under section 124.1 of the Act1.
Table of Contents
1. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 783
2. ROLES OF THE COMMISSIONER, THE DIRECTOR OF PUBLIC

PROSECUTIONS, THE PUBLIC PROSECUTION SERVICE OF
CANADA AND THE COURTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 784
2.1 The Commissioner of Competition . . . . . . . . . . . . . . . . . . . . . . . . . 784
2.2 The Director of Public Prosecutions and Public Prosecution Service of
Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 785
2.3 The Courts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 785
3. LENIENCY IN SENTENCING UNDER THE LENIENCY PROGRAM . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 785
3.1 Conditions for Eligibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 785
3.2 Full, Frank, Timely and Truthful Cooperation . . . . . . . . . . . . . . . . . 786
1 A written opinion provided under section 124.1 of the Act is binding on the Commissioner
if all the material facts have been submitted by or on behalf of an applicant for an opinion
and such facts are accurate. For more information on binding written opinions, including the
Bureau’s fees and service standards for the preparation of such opinions, please see: Compe-
tition Bureau, Competition Bureau Fee and Service Standards Policy (Ottawa: Industry Can-
ada, March 2003), available online at www.competitionbureau.gc.ca.
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Leniency Program
3.3 Reduction of the Recommended Fine — The “Leniency Discount” . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 786
3.4 Determination of Aggravating or Mitigating Factors . . . . . . . . . . . . 787
3.5 Immunity Plus, Evidence of a Broader Conspiracy and Other
Considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 787
3.6 Impact of Leniency on Directors, Officers, Employees and Agents . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 788
3.7 The Leniency Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 789
3.7.1 Initial Contact/Marker Request . . . . . . . . . . . . . . . . . . . . . . . 789
3.7.2 The Proffer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 789
3.7.3 Leniency Recommendation to the PPSC . . . . . . . . . . . . . . . . 789
3.7.4 The Plea Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 790
3.7.5 Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 790
3.7.6 Court Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 790
4. CANCELLATION OF MARKER AND WITHDRAWAL FROM THE

PROGRAM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 791
5. INTERNATIONAL CRIMINAL ANTI-COMPETITIVE ACTIVITY . . . . 791
Guidelines
6. TREATMENT OF INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . 791
6.1 Legal Privilege . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 791
6.2 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 792
6.3 Sharing with Competition Authorities in Other Jurisdictions . . . . . . 793
6.4 Private Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 793
7. CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 793
8. HOW TO CONTACT THE COMPETITION BUREAU . . . . . . . . . . . 793
APPENDIX I — THE CONSPIRACY AND BID-RIGGING PROVISIONS OF

THE COMPETITION ACT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 794
1. — Introduction
1. The Competition Bureau (“Bureau”) is an independent law enforcement agency
responsible for the administration and enforcement of the Competition Act (“Act”).
The Bureau’s enforcement of the Act contributes to the prosperity of Canadians by
protecting and promoting competitive markets and enabling informed consumer
choices.
783
Leniency Program
2. This Bulletin communicates the Bureau’s Leniency Program for cartel cases2.
The Program is designed to support effective enforcement of the Act. A transparent
and predictable Leniency Program complements the Bureau’s Immunity Program3.
3. Under the Leniency Program, the Bureau will recommend to the Public Prosecu-
tion Service of Canada (“PPSC”)4 that qualifying applicants be granted recognition
for timely and meaningful assistance to the Bureau’s investigation and any subse-
quent prosecution. While leniency candidates are not eligible for a grant of immu-
nity under the Bureau’s Immunity Program, their early admission and cooperation
respecting their role in a cartel offence can earn them a substantial basis for lenient
treatment in sentencing.
4. The Leniency Program sets out the factors that guide the Bureau in making a
leniency recommendation to the PPSC for qualifying individuals and business or-
ganizations that cooperate in a timely fashion and plead guilty to cartel offences
under the Act.
2. — Roles of the Commissioner, the Director of Public Prosecutions,

the Public Prosecution Service of Canada and the Courts
2.1 — The Commissioner of Competition
5. The Commissioner5 has independent authority to administer and enforce the Act.
The Bureau and the PPSC work closely together throughout the Bureau’s investiga-
tion and in the subsequent prosecution and sentencing phases of a cartel case6. In
matters of sentencing and, by extension, leniency, the Bureau may only make rec-
ommendations to the PPSC. The PPSC has independent discretion to accept or to
2 For the purposes of this Bulletin, cartel offences include conspiracy (i.e., notably section
45, but also sections 48 and 49 of the Act), foreign directives (i.e., section 46 of the Act) and
bid-rigging (i.e., section 47 of the Act). These provisions are set out in Appendix I.
3 The Bureau’s Immunity Program is available online at
www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03248.html.
4 The PPSC is the federal government organization responsible for prosecutions on behalf of
the Attorney General of Canada. The PPSC was created by the Director of Public Prosecu-
tions Act on December 12, 2006. It replaced the former Federal Prosecution Service of the
Department of Justice. The PPSC is independent from the Department of Justice and reports
to Parliament through the Attorney General of Canada. The Director of Public Prosecutions
(“DPP”) is the head of the Public Prosecution Service and the PPSC represents the DPP in
proceedings before courts of criminal jurisdiction in Canada.
5 For the purposes of this Bulletin, the terms “Commissioner” and “Bureau” are used inter-
changeably, as appropriate to the topic discussed.
6 The Memorandum of Understanding between the Commissioner of Competition and the
Director of Public Prosecutions (“Bureau-DPP MOU”) sets out the respective roles and re-
sponsibilities of the Bureau and DPP and highlights the significant degree of consultation
and cooperation between the two with respect to criminal matters under the Act. The Bu-
reau-DPP MOU is available online at www.competitionbureau.gc.ca/eic/site/cb-
bc.nsf/eng/03227.html.
784
Leniency Program
reject the Bureau’s recommendations. However, the Federal Prosecution Service

Deskbook (“FPS Deskbook”)7 provides that the PPSC should consult with the Bu-
reau and give due consideration to its recommendations.
2.2 — The Director of Public Prosecutions and Public Prosecution

Service of Canada
6. Criminal prosecutions under the Act are the responsibility of the PPSC, and the
Director of Public Prosecutions (“DPP”) has the sole authority to grant leniency to
a party implicated in an offence under the Act. The FPS Deskbook guides the con-
duct of federal prosecutors and provides that the PPSC should consult with the
Bureau regarding its assessment of the public interest8. It is in the public interest to
avoid unnecessary litigation with its attendant costs and uncertainties while, at the
same time, ensuring that parties are held responsible for their criminal activities.
The PPSC plays the lead role throughout case resolution discussions.
2.3 — The Courts

7. Following a guilty plea and conviction under the Act, the PPSC and defence
counsel will make a sentencing submission to the court. The determination of the
sentence to be imposed is at the sole discretion of the court, and a judge is not
bound by a joint sentencing submission. To this end, a judge has the sole authority
to determine an appropriate sentence. Nevertheless a judge will depart from a joint
Guidelines
sentencing submission only where accepting the submission would be contrary to
the public interest, and bring the administration of justice into disrepute9. This is a
high threshold and is intended to foster confidence in an accused, that the joint
sentencing submission will be respected by a sentencing judge.
3. — Leniency in Sentencing under the Leniency Program

3.1 — Conditions for Eligibility
8. The Bureau recommends immunity from prosecution only for the first business
organization or individual10 to apply under the Immunity Program for a marker
(i.e., the immunity applicant). However, other parties to cartel activity (i.e., busi-
ness organizations or individuals) that come forward to resolve their liability and
7 The FPS Deskbook (created by the former Federal Prosecution Service of the Department
of Justice Canada and currently applied to the PPSC) is available online at www.ppsc-
sppc.gc.ca.
8 In particular, see sections 15.3.2.1 and 56.4 of the FPS Deskbook.
9 While this is the current threshold in Ontario (see: R. v. E. (R.W.) (2007), 2007 ONCA 461,
221 C.C.C. (3d) 244, 225 O.A.C. 317, 86 O.R. (3d) 493), the threshold in other provinces
may vary slightly.
10 While the terms “business organization” and “individual”are used throughout this docu-
ment, these references are intended to refer to the terms “person” and “organization” as they
are defined in s. 2 of the Criminal Code.
785
Leniency Program
cooperate with the Bureau’s investigation and any subsequent prosecution by the
PPSC may qualify for leniency in sentencing11.
9. The Bureau will make a recommendation for leniency in sentencing to the PPSC
when the individual or business organization:
(a) has terminated its participation in the cartel;
(b) agrees to cooperate fully and in a timely manner, at its own expense, with
the Bureau’s investigation and any subsequent prosecution of the other cartel
participants by the PPSC; and,
(c) agrees to plead guilty.
10. The timeliness of a leniency applicant’s cooperation is important. Where the
Bureau has referred the results of its investigation to the PPSC for the purposes of a
prosecution, the Leniency Program will no longer be available to an individual or
business organization seeking to resolve criminal liability under the Act in regards
to that investigation.
3.2 — Full, Frank, Timely and Truthful Cooperation

11. Under the Leniency Program, applicants are required to provide full, frank,
timely and truthful cooperation. Timely cooperation means an early request for le-
niency, as well as when and how quickly an applicant cooperates with the Bureau’s
investigation once a leniency application is initiated. Timely cooperation is of para-
mount importance to the Bureau’s determination of the leniency discount it will
recommend to the PPSC in respect of any applicant. Moreover, full and prompt
cooperation at an early phase in the Bureau’s investigation will likely secure a rec-
ommendation by the Bureau for a more substantial mitigation of the sentence than
cooperation at a later phase.
3.3 — Reduction of the Recommended Fine — The “Leniency

Discount”
12. In establishing the base level of an appropriate fine recommendation, the Bu-
reau generally uses a proxy of 20 percent of the cartel participant’s affected volume
of commerce in Canada.
13. The first leniency applicant is eligible for a reduction of 50 percent of the fine
that would otherwise have been recommended, provided that the applicant meets
the requirements of the Leniency Program, including providing full, frank, timely
and truthful cooperation.
14. When an applicant is not the first to come forward under the Leniency Program,
a recommendation for a reduction in sentence may nonetheless be available. The
second leniency applicant is eligible for a reduction of 30 percent of the fine that
11 All discussions regarding the Leniency Program are premised on the assumption that a
marker under the Immunity Program is no longer available. The Immunity Program will
apply to individuals or business organizations who wish to cooperate with the Bureau if a
marker has not yet been granted to an applicant under the Immunity Program.
786
Leniency Program
would have otherwise been recommended by the Bureau to the PPSC. The 30 per-
cent reduction is premised on the leniency applicant meeting all of the conditions of
the Leniency Program to the satisfaction of the Bureau.
15. Subsequent leniency applicants may benefit from reductions to the fine that
would have otherwise been recommended, provided that such applicants meet and
continue to meet all the conditions of the Leniency Program. The actual amount of
the reduction that a subsequent applicant is eligible to receive will depend on when
the applicant sought leniency compared to the second-in applicant and the timeli-
ness of its cooperation. As a rule, later leniency applicants will not be eligible for a
greater leniency discount than earlier applicants.
3.4 — Assessment of Aggravating or Mitigating Factors Within the

Leniency Process
16. In developing a sentencing recommendation to the PPSC, the Bureau will have
regard to aggravating and mitigating factors.
17. Aggravating and mitigating factors12 apply to both accused individuals and
business organizations. The 20 percent proxy associated with the applicant’s cartel
conduct will be increased or reduced based on the presence of aggravating or miti-
gating factors. The weight ascribed to each aggravating or mitigating factor in a
given case is determined according to the facts of the case. After the 20 percent
Guidelines
proxy has been increased or reduced to account for any aggravating or mitigating
factors, the leniency discount will be applied (e.g., 50 percent for first leniency
applicants).
3.5 — Immunity Plus, Evidence of a Broader Conspiracy and Other

Considerations
18. If a leniency applicant discloses evidence of conduct constituting a further
criminal offence under the Act unknown to the Bureau, the applicant may be eligi-
ble for Immunity Plus status13. If the leniency applicant meets the requirements set
out in the Immunity Program regarding the newly-disclosed offence, the Bureau
will recommend that the PPSC grant the applicant immunity from prosecution with
respect to the newly-disclosed offence. In addition, for second-in and later leniency
applicants, the Bureau will recommend that any individuals qualifying under the
Leniency Program be afforded further lenient treatment in respect of the offence for
which leniency is being sought. In recognition of the leniency applicant’s full coop-
eration in reporting the further offence, the Bureau will typically recommend that
an additional five to 10 percent be added to the applicant’s leniency discount.
12 For more information on aggravating and mitigating factors, and how they factor into
sentencing recommendations, please consult the Criminal Code (sections 718, 718.1, 718.2,
and 718.21) and sentencing case law — in particular the sentencing case law with respect to
s. 45 matters under the Act.
13 Details of Immunity Plus may be found in the Bureau’s Immunity Program, available
online at: www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03248.html.
787
Leniency Program
19. If a leniency applicant’s cooperation reveals that the scope of the initial cartel
offence for which leniency is being sought is broader (e.g., in terms of the duration
of the offence) than previously identified by or known from the Bureau’s investiga-
tion or from other cooperating parties, the Bureau will not use that information
against the applicant when determining a leniency recommendation.
20. Other relevant considerations may affect the Bureau’s leniency recommenda-
tion, depending on the circumstances.
3.6 — Impact of Leniency on Directors, Officers, Employees and

Agents
21. At the request of the first-in leniency applicant that is a business organization,
the Bureau will recommend that no separate charges be laid against the applicant’s
current directors, officers or employees, provided that such individuals cooperate
with the Bureau’s investigation in a full, frank, timely and truthful fashion. Agents
and former directors, officers and employees implicated in the offence will also
typically qualify for leniency provided that they offer to cooperate with the Bu-
reau’s investigation and any subsequent prosecution. The Bureau will make a deter-
mination regarding agents and former directors, officers, and employees on a case-
by-case basis, for example, depending on the current employment status of such
individuals (i.e., if they are currently employed by another party to the offence).
22. Where the first leniency applicant is an individual applying independently (i.e.,
implicating his or her current or former employer), leniency will be accorded in the
same manner as if the individual were covered by an employer’s leniency applica-
tion. That is, if the individual meets the eligibility requirements of the Leniency
Program and provides full, frank, timely and truthful cooperation, the Bureau will
recommend that the individual not be criminally charged.
23. For the second and any subsequent leniency applicant, current and former di-
rectors, officers, employees and agents may be charged depending on their role in
the offence. When making its recommendation to the PPSC as to whether a direc-
tor, officer, employee or agent should be charged, and any applicable fine or custo-
dial sentence, the Bureau will consider all of the available facts and circumstances
in respect of such an individual’s participation in the offence14. Directors, officers,
employees and agents who are charged but who cooperate fully under the Leniency
Program, independently or under the umbrella of the leniency application of their
employer, may be eligible to be evaluated by the Bureau as to whether they meet
the conditions necessary to receive a lenient treatment recommendation from the
Bureau.
14 The Bureau takes into account a number of considerations when developing sentencing
recommendations for individuals. These include the role and extent of involvement of the
individual who participated in the offence, the degree to which the individual personally
benefited from the offence (e.g., through advancement, salary increases, performance bo-
nuses, etc.), and whether the individual has been previously sanctioned for cartel offences in
Canada or another jurisdiction and whether the individual has a criminal record.
788
Leniency Program
3.7 — The Leniency Process

3.7.1 — Initial Contact/Marker Request
24. Under the Bureau’s Immunity Program, marker requests for immunity for cartel
offences must be made to the Senior Deputy Commissioner of Competition, Crimi-
nal Matters Branch (“SDC”). Likewise, an application to the Bureau’s Leniency
Program must be made to the SDC. Typically, an applicant’s legal counsel makes
the contact with the Bureau. The applicant should provide sufficient information to
enable the SDC to determine if a leniency “marker” is available. Specifically, the
applicant should provide a description of the product(s) subject to the cartel activ-
ity. When making the initial request for a leniency marker, the applicant may pro-
vide information on a hypothetical basis. Where leniency is available, the SDC will
advise the applicant of the Bureau’s Leniency Program and of the applicant’s place
in the marker queue (i.e., should there be previous leniency applicants). A leniency
applicant who receives a marker will be allowed a fixed amount of time to confirm
its intention to participate in the Leniency Program (within four business days).
During this time, the marker holds the applicant’s specific place in the queue. Once
participation in the program is confirmed, the applicant will have 30 calendar days
during which to complete its proffer to the Bureau setting out the evidence of its
participation in the cartel and the cooperation that will provide the basis for the
Bureau’s recommendation for leniency.
Guidelines
3.7.2 — The Proffer
25. During the proffer the leniency applicant must reveal its identity and describe in
detail the anti-competitive activity, including the participants to the offence, the
nature of the agreement, the affected volume of commerce in Canada and any other
factors relevant to culpability. A proffer is typically made by the leniency appli-
cant’s legal counsel and all information provided will be treated as settlement privi-
leged. In preparing the proffer, leniency applicants are expected to conduct thor-
ough internal investigations to locate all relevant evidence, wherever such evidence
may be located, whether in Canada or elsewhere. This evidence may be in the form
of records, witness testimony or any other source of information that will assist the
Bureau’s investigation.
3.7.3 — Leniency Recommendation to the PPSC

26. The Bureau will advise the PPSC of the evidence that the leniency applicant has
proffered. The Bureau will make its leniency recommendation to the PPSC only
after an applicant has completed its proffer and provided all relevant information
pertinent to leniency and sentencing for that applicant. The Bureau can make a
timely and supportable leniency recommendation to the PPSC in respect of sen-
tencing only if it receives a complete and timely proffer. The PPSC retains full
discretion whether to follow the Bureau’s recommendation, but will give the Bu-
reau’s recommendation due consideration.
789
Leniency Program
3.7.4 — The Plea Agreement

27. Plea discussions with the leniency applicant are conducted and led by the
PPSC. The Bureau typically attends to assist the PPSC with any details about the
leniency applicant’s cooperation and the value of such cooperation provided to the
Bureau’s investigation. A successful resolution of negotiations between the leni-
ency applicant and the PPSC will result in a plea agreement between the two
parties15.
28. The plea agreement reached with the PPSC will be conditional on the full and
timely cooperation of the leniency applicant, and others covered under its terms,
with the ongoing investigation and any related prosecution. The plea agreement
will require the leniency applicant to provide full, frank, timely and truthful disclo-
sure of all non-privileged information, records or other materials in its possession,
under its control or available to it, wherever located, that in any manner relate to
the anti-competitive conduct for which leniency is sought.
3.7.5 — Full Disclosure

29. A leniency applicant is expected to complete its production of evidence, infor-
mation, records, and other materials to the Bureau as soon as possible after the plea
agreement is concluded. Individuals covered by the plea agreement will attend in-
terviews and testify in prosecutions of the other parties to the cartel, as required.
Leniency applicants that are business organizations must facilitate the cooperation
of current directors, officers, and employees, as well as any agents or former direc-
tors, officers and employees covered by the plea agreement.
30. The Bureau may, under some circumstances, request that a leniency applicant
disclose evidence relevant to the Bureau’s investigation before the plea agreement
has been concluded. Applicants who are asked to disclose records and facilitate the
cooperation of individual witnesses before the plea agreement is concluded will be
assured that the information will not be used directly against them and will be
treated as either confidential or settlement privileged, depending on the facts.
3.7.6 — Court Proceedings

31. Following the conclusion of the plea agreement, the PPSC will set a date with
counsel for the leniency applicant for filing of the information and the plea before
the court. The PPSC and counsel for the leniency applicant will make a joint sen-
tencing submission based on the Statement of Admissions, as the basis for the plea
and sentence. The Statement of Admissions will set out a sufficient factual basis to
enable the court to make a determination that an offence has been committed.
32. The Bureau will not recommend that the PPSC delay the filing of the informa-
tion at the request of the leniency applicant, unless there are compelling reasons to
do so and provided that the Bureau’s investigation or the PPSC’s prosecution of
15 The publication of a sample template plea agreement by the PPSC is forthcoming and will
be available on the PPSC website at www.ppsc-sppc.gc.ca
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Leniency Program
other parties to the offence will not be impeded. The PPSC has independent discre-
tion when deciding whether or not to delay the filing of an information.
4. — Cancellation of Marker and Withdrawal from the Program

33. If a proffer is not completed within 30 calendar days from the date of the
marker, and if no extension has been granted, or where the Bureau is informed by
the PPSC that plea discussions are terminated because the parties are unable to
reach an agreement, the Bureau may cancel the leniency applicant’s marker.
34. Should a leniency applicant have its marker cancelled or alternatively withdraw
from the Leniency Program at any time before concluding the plea agreement, the
applicant can be assured that information provided under the Leniency Program
will not be used directly against it and will be treated as either confidential or set-
tlement privileged, depending on the facts. However, the Bureau is free to use in-
formation provided by a leniency applicant to pursue its investigation and any such
evidence derived directly or indirectly therefrom may be used in any subsequent
prosecution of the parties to the offence.
5. — International Criminal Anti-Competitive Activity

35. A leniency applicant should be aware that, when the cartel conduct involves
other countries, the Bureau may be aware of the offence in Canada as a result of a
Guidelines
foreign investigation. Leniency applicants may consider approaching each jurisdic-
tion’s competition law authority in an effort to secure an advantage under all avail-
able leniency or immunity programs. However, an applicant whose business activi-
ties have a substantial connection to Canada should make its contact with the
Bureau a priority. The Bureau will not afford any special consideration to a leni-
ency applicant solely because it has been granted immunity or another form of fa-
vourable treatment in another jurisdiction.
6. — Treatment of Information
6.1 — Legal Privilege
36. All information provided during the proffer and plea agreement stages of the
Leniency Program, including witness interviews and records created for the pur-
pose of the proffer or plea negotiations and the plea agreement itself will be treated
as settlement privileged.
37. Information provided by the leniency applicant in the course of the proffer or
plea agreement discussions may be used by the Bureau to pursue its investigation.
Nonetheless, such information will not be used directly against the leniency appli-
cant or its cooperating individuals and will be treated by the Bureau as confidential.
To this end, the Bureau’s policy on confidentiality, as discussed in the next section,
will apply.
38. As part of the leniency applicant’s ongoing cooperation obligations, once the
plea agreement is concluded, all information provided by the leniency applicant
prior and pursuant to the plea agreement may be used by the Bureau in its investi-
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gation and by the PPSC in any subsequent prosecution against other parties to the
offence.
39. The Bureau may take the position that public interest privilege, as well as other
legal privileges, apply to information provided by the leniency applicant either
before or after the conclusion of the plea agreement, depending on the particular
circumstances at hand.
6.2 — Confidentiality
40. The Bureau’s policy on confidentiality is over and above that provided in sec-
tion 29 of the Act16. There are certain limited exceptions to the Bureau’s assurance
of confidentiality, which are similar to those included in the Bureau’s Immunity
Program. The Bureau treats the identity of a leniency applicant or any information
provided by the applicant as confidential, except where:
(a) disclosure is required by law;
(b) disclosure is necessary to obtain or maintain the validity of a judicial au-
thorization for the exercise of investigative powers;
(c) disclosure is for the purpose of securing the assistance of a Canadian law
enforcement agency in the exercise of investigative powers;
(d) the party has agreed to disclosure;
(e) there has been public disclosure by the party;
(f) disclosure is necessary to prevent the commission of a serious criminal
offence; or
(g) in the case of information other than the leniency applicant’s identity,
where disclosure of such information is for the purpose of the administration
or enforcement of the Act.
41. As discussed above, all information provided by a leniency applicant up until
the plea agreement is concluded will be treated as settlement privileged. Nonethe-
less, recourse to investigative powers, such as search warrants and production or-
ders, can be of utmost importance to the Bureau’s investigation. To this end, where
the Bureau applies to the court for the authorization of investigative powers and
information provided by the leniency applicant must be disclosed to the issuing
court as part of the Bureau’s obligation to provide full and frank disclosure, the
Bureau will make an application to seal the information so that it remains confiden-
tial until settlement privilege no longer applies. In cases where the Bureau seeks
authorization for investigative powers and needs to rely on information provided by
16 Section 29 is the provision in the Act that deals with the communication of information in
the possession or control of the Bureau, whether it was provided voluntarily or obtained by
court order. The section prohibits communicating both the information and the identity of
any persons who provided it, subject to limited exceptions, which include: 1) to a Canadian
law enforcement agency; 2) for the purposes of the administration or enforcement of the Act;
3) information that has been made public; and 4) information that has been authorized for
communication by the person who provided the information.
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a leniency applicant which is not subject to settlement privilege, the Bureau will
take all reasonable steps to ensure that the name of the leniency applicant remains
confidential until charges are laid.
42. A leniency applicant is required to keep its contact with the Bureau confiden-
tial. An applicant should not disclose its leniency application to any person, other
than his or her counsel, without the consent of the Bureau, which will not be unrea-
sonably withheld. Depending on the circumstances, the Bureau may also ask that
the leniency applicant obtain the consent of the PPSC. Where disclosure of a leni-
ency application is required by law (e.g., in the case of required securities filings),
the leniency applicant must give notice to and consult with the Bureau on how to
protect the Bureau’s interests regarding the ongoing investigation into the cartel
activity in light of the disclosure requirement. The leniency applicant shall give
notice of any such disclosure requirement to the Bureau as soon as it becomes
aware of the requirement.
6.3 — Sharing with Competition Authorities in Other Jurisdictions

43. The Bureau will not disclose the identity of a leniency applicant or the informa-
tion provided by that applicant to any foreign law enforcement agency without the
consent of the applicant or unless required by law (e.g., in response to an order of a
Canadian court of competent jurisdiction). As part of a leniency applicant’s ongo-
ing cooperation, absent compelling reasons, the Bureau will expect a waiver au-
Guidelines
thorizing the communication of information with those jurisdictions to which the
applicant has made similar applications for immunity or leniency.
6.4 — Private Actions

44. The Bureau’s policy with respect to private actions under section 36 of the Act
is to disclose the identity of, or any information provided by, a leniency applicant
only in response to a court order. In the event of such an order, the Bureau will take
all reasonable steps to protect the confidentiality of the information and the identity
of the leniency applicant, including seeking protective court orders.
7. — Conclusion
45. The Bureau encourages the public to inform itself of the Bureau’s policies and
programs designed to facilitate conformity with the provisions of the Act. Anyone
wishing to apply for leniency in cartel cases should contact the Senior Deputy
Commissioner of Competition (Criminal Matters Branch) at 819-997-1208. For
further information, visit the Bureau website at www.competitionbureau.gc.ca or
contact the Bureau toll-free at 1 (800) 348-5358.
8. — How to Contact the Competition Bureau

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Web site
Address
Information Centre
Competition Bureau
50 Victoria Street
Gatineau, Quebec
K1A 0C9
Telephone
Toll-free: 1-800-348-5358
Facsimile
819-997-0324
Appendix I — The Conspiracy and Bid-Rigging Provisions

of the Competition Act
45. Conspiracy — (1) Every person commits an offence who, with a competitor of
that person with respect to a product, conspires, agrees or arranges
ply of the product.
(2) Every person who commits an offence under subsection (1) is guilty of an indict-
able offence and liable on conviction to imprisonment for a term not exceeding 14
years or to a fine not exceeding $25 million, or to both.
(3) In a prosecution under subsection (1), the court may infer the existence of a
conspiracy, agreement or arrangement from circumstantial evidence, with or without
direct evidence of communication between or among the alleged parties to it, but,
for greater certainty, the conspiracy, agreement or arrangement must be proved be-
yond a reasonable doubt.
conspiracy, agreement or arrangement that would otherwise contravene that subsec-
tion if
(i) it is ancillary to a broader or separate agreement or arrangement that
includes the same parties, and
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(ii) it is directly related to, and reasonably necessary for giving effect to,
the objective of that broader or separate agreement or arrangement; and
(b) the broader or separate agreement or arrangement, considered alone, does
not contravene that subsection.
conspiracy, agreement or arrangement that relates only to the export of products
from Canada, unless the conspiracy, agreement or arrangement
(c) is in respect only of the supply of services that facilitate the export of prod-
ucts from Canada.
(6) Subsection (1) does not apply if the conspiracy, agreement or arrangement
(a) is entered into only by companies each of which is, in respect of every one
of the others, an affiliate; or
49(1).
(7) The rules and principles of the common law that render a requirement or authori-
zation by or under another Act of Parliament or the legislature of a province a de-
fence to a prosecution under subsection 45(1) of this Act, as it read immediately
Guidelines
before the coming into force of this section, continue in force and apply in respect of
a prosecution under subsection (1).
(8) The following definitions apply in this section.
“competitor” includes a person who it is reasonable to believe would be likely to
compete with respect to a product in the absence of a conspiracy, agreement or ar-
rangement to do anything referred to in paragraphs (1)(a) to (c).
“price” includes any discount, rebate, allowance, price concession or other advan-
tage in relation to the supply of a product.
R.S.C. 1985, c. C-34, s. 45; R.S.C. 1985, c. 19 (2nd Supp.), s. 30; S.C. 1991, c.
45, s. 547; c. 46, s. 590; c. 47, s. 714; S.C. 2009, c. 2, s. 410
45.1 Where application made under sections 76, 79, 90.1 or 92 — No proceed-
ings may be commenced under subsection 45(1) against a person on the basis of
facts that are the same or substantially the same as the facts on the basis of which an
order against that person is sought by the Commissioner under section 76, 79, 90.1
or 92.
R.S.C. 1985, c. 19 (2nd Supp.), s. 31; S.C. 2009, c. 2, s. 410
46. (1) Foreign directives — Any corporation, wherever incorporated, that carries
on business in Canada and that implements, in whole or in part in Canada, a direc-
tive, instruction, intimation of policy or other communication to the corporation or
any person from a person in a country other than Canada who is in a position to
direct or influence the policies of the corporation, which communication is for the
purpose of giving effect to a conspiracy, combination, agreement or arrangement
entered into outside Canada that, if entered into in Canada, would have been in con-
travention of section 45, is, whether or not any director or officer of the corporation
in Canada has knowledge of the conspiracy, combination, agreement or arrange-
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ment, guilty of an indictable offence and liable on conviction to a fine in the discre-
tion of the court.
(2) Limitation — No proceedings may be commenced under this section against a
particular company where an application has been made by the Commissioner under
section 83 for an order against that company or any other person based on the same
or substantially the same facts as would be alleged in proceedings under this section.
2, s. 37
47. (1) Definition of “bid-rigging” — In this section, “bid-rigging” means
(a) an agreement or arrangement between or among two or more persons
whereby one or more of those persons agrees or undertakes not to submit a bid
or tender in response to a call or request for bids or tenders, or agrees or under-
takes to withdraw a bid or tender submitted in response to such a call or re-
quest, or
(b) the submission, in response to a call or request for bids or tenders, of bids
or tenders that are arrived at by agreement or arrangement between or among
two or more bidders or tenderers,
where the agreement or arrangement is not made known to the person calling for or
requesting the bids or tenders at or before the time when any bid or tender is submit-
ted or withdrawn, as the case may be, by any person who is a party to the agreement
or arrangement.
(2) Bid-rigging — Every person who is a party to bid-rigging is guilty of an indicta-
ble offence and liable on conviction to a fine in the discretion of the court or to
imprisonment for a term not exceeding 14 years, or to both.
(3) Exception — This section does not apply in respect of an agreement or arrange-
ment that is entered into or a submission that is arrived at only by companies each of
which is, in respect of every one of the others, an affiliate.
R.S.C. 1985, c. C-34, s. 47; R.S.C. 1985, c. 19 (2nd Supp), s. 33; S.C. 2009, c.
2, s. 411
48. (1) Conspiracy relating to professional sport — Every one who conspires,
combines, agrees or arranges with another person
(a) to limit unreasonably the opportunities for any other person to participate,
as a player or competitor, in professional sport or to impose unreasonable
terms or conditions on those persons who so participate, or
(b) to limit unreasonably the opportunity for any other person to negotiate with
and, if agreement is reached, to play for the team or club of his choice in a
professional league
is guilty of an indictable offence and liable on conviction to a fine in the discretion
of the court or to imprisonment for a term not exceeding five years or to both.
(2) Matters to be considered — In determining whether or not an agreement or
arrangement contravenes subsection (1), the court before which the contravention is
alleged shall have regard to
(a) whether the sport in relation to which the contravention is alleged is organ-
ized on an international basis and, if so, whether any limitations, terms or con-
ditions alleged should, for that reason, be accepted in Canada; and
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(b) the desirability of maintaining a reasonable balance among the teams or

clubs participating in the same league.
(3) Application — This section applies, and section 45 does not apply, to agree-
ments and arrangements and to provisions of agreements and arrangements between
or among teams and clubs engaged in professional sport as members of the same
league and between or among directors, officers or employees of those teams and
clubs where the agreements, arrangements and provisions relate exclusively to mat-
ters described in subsection (1) or to the granting and operation of franchises in the
league, and section 45 applies and this section does not apply to all other agree-
ments, arrangements and provisions thereof between or among those teams, clubs
and persons.
S.C. 1974-75-76, c. 76, s. 15
49. (1) Agreements or arrangements of federal financial institutions — Subject
to subsection (2), every federal financial institution that makes an agreement or ar-
rangement with another federal financial institution with respect to
(c) the amount or kind of any charge for a service provided to a customer,
(f) the person or classes of persons to whom a loan or other service will be
Guidelines
made or provided or from whom a loan or other service will be withheld,
and every director, officer or employee of the federal financial institution who
knowingly makes such an agreement or arrangement on behalf of the federal finan-
cial institution is guilty of an indictable offence and liable to a fine not exceeding ten
million dollars or to imprisonment for a term not exceeding five years or to both.
(2) Exceptions — Subsection (1) does not apply in respect of an agreement or
arrangement
(a) with respect to a deposit or loan made or payable outside Canada;
(b) applicable only in respect of the dealings of or the services rendered be-
tween federal financial institutions or by two or more federal financial institu-
tions as regards a customer of each of those federal financial institutions where
the customer has knowledge of the agreement or by a federal financial institu-
tion as regards a customer thereof, on behalf of that customer’s customers;
(c) with respect to a bid for or purchase, sale or underwriting of securities by
federal financial institutions or a group including federal financial institutions;
(d) with respect to the exchange of statistics and credit information, the devel-
opment and utilization of systems, forms, methods, procedures and standards,
the utilization of common facilities and joint research and development in con-
nection therewith, and the restriction of advertising;
(e) with respect to reasonable terms and conditions of participation in guaran-
teed or insured loan programs authorized pursuant to an Act of Parliament or
of the legislature of a province;
(f) with respect to the amount of any charge for a service or with respect to the
kind of service provided to a customer outside Canada, payable or performed
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outside Canada, or payable or performed in Canada on behalf of a person who

is outside Canada;
(g) with respect to the persons or classes of persons to whom a loan or other
service will be made or provided outside Canada;
(h) in respect of which the Minister of Finance has certified to the Commis-
sioner that Minister’s request for or approval of the agreement or arrangement
for the purposes of financial policy and has certified the names of the parties to
the agreement or arrangement; or
(i) that is entered into only by financial institutions each of which is an affiliate
of each of the others.
(3) Definition of “federal financial institution” — In this section and section 45,
“federal financial institution” means a bank or an authorized foreign bank within the
meaning of section 2 of the Bank Act, a company to which the Trust and Loan Com-
panies Act applies or a company or society to which the Insurance Companies Act
applies.
(4) Where proceedings commenced under section 76, 79, 90.1 or 92 — No
proceedings may be commenced under this section against a person on the basis of
facts that are the same or substantially the same as the facts on the basis of which an
order against that person is sought by the Commissioner under section 76, 79, 90.1
or 92.
45, s. 548; c. 46, ss. 591, 593; c. 47, s. 715; S.C. 1993, c. 34, s. 51; S.C. 1999,
c. 2, s. 37; c. 28, s. 153; c. 31, s. 49(F); S.C. 2009, c. 2, s. 412
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Leniency Program: Frequently Asked Questions*

This document supplements the Leniency Program Bulletin.
This document does not provide legal advice. Readers should refer to the Competi-
tion Act (Act) when questions of law arise and obtain legal advice if necessary. The
Bureau may choose to depart from the approach set out in this document in excep-
tional circumstances.
This document applies to conduct that has already occurred. A party wishing to
seek a binding written opinion from the Commissioner of Competition (Commis-
sioner) on the applicability of the Act to proposed business conduct may do so
under section 124.1 of the Act.17
All discussions regarding the Leniency Program are premised on the assumption
that an immunity marker under the Immunity Program is no longer available. The
Immunity Program will apply to individuals and organizations that wish to cooper-
ate with the Bureau if an immunity marker has not yet been granted under the Im-
munity Program.
Step 1: — Requesting a Leniency Marker

Q1 — What is a leniency marker?
A “leniency marker” is the acknowledgement given to a leniency applicant (Appli-
Guidelines
cant) that records the date and time of an Applicant’s application to the Leniency
Program. It establishes the Applicant’s position in line in relation to other individu-
als or organizations seeking to participate in the Leniency Program. The leniency
marker guarantees the Applicant’s position in line, subject to the Applicant meeting
all of the other criteria of the Leniency Program.
As indicated in paragraph 24 of the Leniency Bulletin, an Applicant that receives a
leniency marker will be allowed four business days to confirm its intention to par-
ticipate in the Leniency Program. Once participation is confirmed, the Applicant
* Immunity Program: Frequently Asked Questions, (Web Page Date Modified: 2018-02-14,
Innovation, Science and Economic Development Canada, https://www.competitionbureau.
gc.ca/eic/site/cb-bc.nsf/eng/03594.html. Reproduced with the permission of the Minister of
Innovation, Science and Economic Development, 2019. The content of this document may
be subject to change or may be removed from the Government website without notice.
17 A written opinion provided under section 124.1 of the Act is binding on the Commis-
sioner if all of the material facts have been submitted by or on behalf of an applicant for an
opinion and such facts are accurate. For more information on binding written opinions, in-
cluding the Bureau’s fees and service standards for the preparation of such opinions, please
see: Competition Bureau, Competition Bureau Fees and Service Standards Handbook for
Written Opinions (Ottawa: Industry Canada, May 18, 2011) and Competition Bureau, Com-
petition Bureau Fees and Service Standards Handbook for Mergers and Merger-Related
Matters (Ottawa: Industry Canada, Effective November 1, 2010).
Return to footnote 1 referrer
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has a limited period of time, usually 30 calendar days, to provide the Competition
Bureau with a detailed statement describing the illegal activity, its effects in Can-
ada and the supporting evidence. This statement is known as a “proffer” and is
described in more detail in the responses to questions 16 and 18 below.
Q2 — For what offences is a leniency marker available?
An Applicant may request a leniency marker for cartel offences under the Act. Car-
tel offences under the Act are those offences under sections 45 to 49, including
conspiracy (sections 45 and 46) and bid-rigging (section 47).
An Applicant may also request a leniency marker for such offences when liability
arises from aiding or abetting any of these offences contrary to section 21 of the
Criminal Code or counselling any of these offences contrary to section 22 of the
Criminal Code.
Q3 — Can a party request a leniency marker for an offence of obstruction or
destruction of records or other things?
No. A leniency marker is not available for obstruction, for destruction of records or
other things (collectively records), or for any offence under the Act other than those
described in response to question 2 above. Instances of obstruction arising in rela-
tion to activity for which leniency is sought should be brought to the attention of
the Bureau as soon as possible.
If an Applicant or any of the individuals within the scope of the Applicant’s leni-
ency application engage in obstruction after requesting leniency, they risk expul-
sion from the Leniency Program and prosecution for both obstruction and the of-
fence for which leniency was sought. Whether they will be expelled from the
Leniency Program will be determined on a case-by-case basis having regard to all
of the circumstances in question.
Q4 — Who can request a leniency marker?
An individual or an organization18 can request a leniency marker. Typically, an
Applicant’s counsel makes the contact with the Bureau.
Q5 — Can an Applicant tell others about its leniency marker request or leni-
ency application?
As set out in paragraph 42 of the Leniency Bulletin, the Bureau requires that Ap-
plicants keep leniency applications confidential. Confidentiality helps to ensure that
the integrity of the Bureau’s investigation is maintained, that evidence is not de-
stroyed, and that targets of the investigation do not become prematurely aware of
investigative steps.
18 As defined in the Criminal Code, the word “organization” may refer to a public body, a
body corporate, a society, a company, a firm, a partnership, a trade union or a municipality.
It may also refer to an association of persons that is created for a common purpose, that has
an operational structure and that holds itself out to the public as an association of persons.
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Leniency Program
An Applicant shall not disclose its application for a leniency marker and subse-
quent lenient treatment, or any related information, to a third party, other than its
counsel or agencies in foreign jurisdictions to which the Applicant has made simi-
lar applications for immunity or leniency, unless consent is first obtained from the
Bureau. Depending on the circumstances, the Bureau may ask that the Applicant
also obtain the consent of the Public Prosecution Service of Canada (PPSC).
The only exceptions to obtaining consent occur if the application is public, or if the
Applicant is required by law to disclose the information, whether in Canada or else-
where. An Applicant that believes that disclosure is required by law must give no-
tice to the Bureau as soon as practicable after becoming aware of the disclosure
requirement and consult with the Bureau on how to protect the interests of the Bu-
reau’s investigation in light of the disclosure requirement.
An Applicant must advise the Bureau as soon as practicable of the identity of all
third parties, other than its counsel, to whom its application for leniency has been
disclosed, including the agencies in all foreign jurisdictions to which the Applicant
has made similar applications for immunity or leniency.
If an Applicant or any of the individuals within the scope of the Applicant’s leni-
ency application disclose the Applicant’s leniency application before obtaining
consent or otherwise notifying the Bureau, they risk expulsion from the Leniency
Program and prosecution for the offence for which leniency was sought. Whether
they will be expelled from the Leniency Program will be determined on a case-by-
Guidelines
case basis having regard to all of the circumstances in question.
Q6 — Who should a party call to request a leniency marker?
Leniency markers are granted by the Senior Deputy Commissioner of Competition,
Criminal Matters Branch (SDC). Applicants cannot rely on any alternative contact,
for example, with a Bureau officer or other Bureau employee, in respect of its ap-
plication to obtain a leniency marker.
It is recommended that leniency marker requests be made by telephone and that the
Applicant clearly state that it is making a leniency marker call. The Applicant
should ensure that all information is clearly stated and that it and the SDC are in
agreement that a leniency marker has been requested, on the date and time of the
request, and on the description of the relevant product. As soon as possible follow-
ing the request, usually within a few days, the SDC will advise the Applicant
whether the requested leniency marker is available to the Applicant and its position
in line in relation to other Applicants seeking to participate in the Leniency
Program.
Q7 — Does the PPSC grant leniency markers?
No. The PPSC does not accept leniency marker calls or grant leniency markers to
Applicants. Applicants cannot rely on contact with the PPSC to establish a leniency
marker. Leniency markers are granted only by the SDC.
Q8 — Why is it important to request a leniency marker as soon as possible?
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Leniency Program
The Bureau grants a leniency marker to reflect each Applicant’s position in line.
The available discounts and other benefits of the Leniency Program vary depending
on an Applicant’s position in line.
The tiered approach to discounts and other benefits based on an Applicant’s posi-
tion in line and degree of cooperation is intended to encourage individuals and or-
ganizations to apply and cooperate early to secure a leniency advantage over subse-
quent Applicants. Individuals and organizations should come forward as soon as
they believe they are implicated in an offence to ensure that they may qualify for
the best available recommendation for leniency.
Q9 — If a party is unsure that an offence has been committed, or what prod-
ucts are involved, should it request a leniency marker anyway?
Yes. Since time is of the essence, the Bureau encourages individuals and organiza-
tions to come forward and request a leniency marker as soon as they believe they
may be implicated in an offence. If an Applicant later determines that it was not
involved in an offence, it should notify the SDC and withdraw its leniency marker.
Where an Applicant’s proffer provides insufficient information that it committed an
offence, the Bureau will make no recommendation to the PPSC as to a grant of
leniency and will request that the Applicant withdraw its leniency marker. In the
event that the Applicant does not withdraw its leniency marker, the leniency marker
will be cancelled by the SDC following a minimum of 14 calendar days notice to
the Applicant.
Q10 — Should a party request a leniency marker even if it does not sell prod-
ucts directly or indirectly into Canada?
A party should request a leniency marker if it believes that it has committed an
offence in Canada, regardless of whether it sells products directly or indirectly into
Canada. In this regard, cartel offences can arise, for example, where a party does
not sell products into Canada as part of a market allocation agreement contrary to
section 45 of the Act, or where a party agrees not to submit a bid in response to a
call or request for bids or tenders contrary to section 47 of the Act.
Q11 — How does the Bureau treat leniency markers and recommendations for
leniency in the context of investigations that it does not intend to further
pursue?
The Bureau will not make a formal recommendation for leniency to the PPSC in
cases where it does not intend to further investigate the alleged anti-competitive
conduct. In these situations, the Bureau will (a) advise the Applicant of its leniency
position, (b) confirm that the Applicant’s leniency position will be respected should
the Bureau decide to pursue the investigation at a later time, and (c) describe the
scope of the products and conduct that would have been included in a leniency
recommendation to the PPSC had the investigation continued. This will be done
verbally, unless the Applicant requests that it be done by way of letter.
If the Bureau subsequently decides that it will investigate the alleged anti-competi-
tive conduct, it will advise the Applicant and take steps to recommend that leniency
be granted for the products and conduct previously described to the Applicant, pro-
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Leniency Program
vided that the organizations and/or individuals that would be covered by the recom-
mendation for leniency continue to meet the conditions of the Leniency Program.
Q12 — Is it true that all leniency cases are international cases?
No. The Leniency Program applies equally to domestic and international conspira-
cies and the Bureau has, on a number of occasions, recommended leniency in re-
spect of both domestic and international cartels.
Q13 — What kind of information is the Bureau looking for at the leniency
marker stage?
The Bureau requires sufficient information to determine an Applicant’s position in
line under the Leniency Program. It does this by comparing the conduct and prod-
uct description provided by the Applicant to information already in the Bureau’s
possession. This enables the Bureau to determine whether another party has re-
quested an immunity or leniency marker for the same conduct and product.
For this reason, it is imperative that the Applicant, when identifying the offence,
provide a precise product definition, including a description of any sub-products
that may be covered within the scope of the leniency marker request, as well as the
time period for the conduct in question. In some circumstances, the Bureau may
request more detailed information regarding the offence, the geographic market or
the other parties involved to assist it in the determination of whether the requested
leniency marker is available.
Guidelines
Q14 — Can the information provided to secure a leniency marker be hypo-
thetical in nature?
Yes. An Applicant may provide information on a hypothetical basis at the leniency
marker request stage — it is not required to reveal its identity to obtain a leniency
marker. At this stage, information is often provided by an Applicant’s counsel.
However, once a leniency marker is granted, the Applicant will need to identify
itself to facilitate the Bureau’s preparations for the Applicant’s proffer and the Bu-
reau’s investigation.
Q15 — Can leniency markers lapse or be cancelled by the Bureau?
If an Applicant fails to provide its proffer within 30 calendar days after a leniency
marker has been granted, or within any extended period of time agreed to by the
SDC, the Applicant’s leniency marker will automatically lapse. The Applicant’s
leniency marker will also automatically lapse at the end of this period if the Appli-
cant provides a proffer and is subsequently informed by the Bureau that the proffer
is incomplete or otherwise insufficient and it has not obtained an extension from
the SDC.
There is no obligation on the SDC to notify the Applicant that its leniency marker
has lapsed in such circumstances. Rather, it is the Applicant’s responsibility to seek
an extension from the SDC in such cases. For information on how to request an
extension, see the response to question 21 below.
The SDC may also cancel a leniency marker if the Applicant fails to meet any of
the other requirements of the Leniency Program. The SDC’s decision to cancel a
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Leniency Program
leniency marker will be made only after serious consideration of all factors and a
minimum of 14 calendar days notice to the Applicant.
Step 2: — The Proffer Stage

Q16 — What is a proffer?
After receiving a leniency marker, an Applicant must provide the Bureau with a
statement known as a proffer. In a proffer, an Applicant describes in detail the ille-
gal activity, its role in the offence for which leniency is sought, and the effect of the
illegal activity in Canada. The Applicant must also outline all of the supporting
evidence and witnesses that it can provide at that point in time as part of its cooper-
ation under the Leniency Program. Proffers are generally provided on a “without
prejudice” basis by an Applicant’s counsel.
Q17 — When should a proffer be made?
An Applicant should make and complete its proffer as soon as possible after receiv-
ing its leniency marker, typically within 30 calendar days after the leniency marker
has been granted by the SDC. The SDC will discuss timing requirements with an A
pplicant during the leniency marker call. The timing of a proffer can affect other
steps in the Bureau’s investigation, such as the execution of a search warrant or
cooperation with another jurisdiction, where timing can be critical. In certain cir-
cumstances, the Bureau may require the Applicant to make its proffer early within
the 30 calendar day period.
Q18 — What kind of information should be provided at the proffer stage?
At the proffer stage, an Applicant must provide a description of the illegal activity
for which leniency is sought and outline all of the information it has at that point in
time relating to that activity so that the Bureau can determine the full scope of the
Applicant’s criminal liability under the Act. Accuracy is critical. The Bureau relies
on the information provided to assess the leniency application, to make its recom-
mendation for leniency to the PPSC and to pursue its investigation of other parties
to the offence.
At the proffer stage, the Bureau will not accept a bare outline of the conduct or
speculation as to the Applicant’s role. The Bureau requires the details of the Appli-
cant’s role and sufficient information to obtain a clear appreciation of the evidence
each witness identified by the Applicant can provide about the conduct. Applicants
should report as completely and accurately as possible with truthfulness and in a
spirit of cooperation.
Applicants have a positive obligation to update their proffered information as they
become aware of either new or corrected information. This must be done promptly
and on an ongoing basis, regardless of whether or not the Bureau has specifically
asked for the information.
Topics to be covered in a proffer may include those set out below. This list is not
intended to be exhaustive and the information required will depend on the facts and
the relevant offence. For example, evidence of an undue lessening of competition
will be required in the case of a conspiracy where some of the conduct pre-dates
March 12, 2010 (when the current conspiracy provision came into force).
804
Leniency Program
The Parties
• a general description of the Applicant and the other parties implicated in the
conduct;
• the individuals involved in the offence;
• business ownership structures, including affiliations;
• the Applicant’s share of, and role in, the market;
• membership in, or involvement with, trade or other associations;
• the nature and level of involvement in the offence;
The Product
• the physical and technical characteristics of the product;
• the end use and value of the product;
The Industry
• a general description of the industry and how it functions;
• how pricing in the industry works;
Guidelines
• the regulatory framework;
• the existence and nature of contracts;
• how the product is supplied;
• customer or supplier countervailing power;
Market Information
• other market participants (domestic or foreign) and their market shares;
• a description of the key customers in Canada and elsewhere;
• the geographic locations of sellers and customers;
Required if the conduct pre-dates March 12, 2010, and the offence requires proof
of undueness:19
• any product substitutes and their price levels (including transportation costs);
• barriers to entry into the market;
• costs for a customer to switch to an alternate product;
19 For more information on the concept of undueness, an Applicant should refer to the re-
sponse to question 23 of the Bureau’s Immunity Program FAQs.
805
Leniency Program
The Conduct
• a description of the conduct, including the nature and timing of communica-
tions among competitors;
• the time period of the conduct;
• the geographic scope of the conduct;
• monitoring or enforcement measures utilized in carrying out the offence;
• whether any agreements or arrangements were set out in writing;
• whether other participants continue to engage in the conduct;
• measures taken to conceal the conduct or the identity of the participants;
• abusive or threatening behaviour relating to the offence;
Impact of the Conduct

• the volume of commerce affected in Canada, whether directly or indirectly,
along with a description of the methodology, data and sources used to make or
support that determination;
• pricing and other effects;
• whether customers or potential customers are aware of the conduct or have
complained about it;
Evidentiary Process
• a general description of witnesses who the Applicant believes could testify
about the conduct and the anticipated nature of their evidence;
• a description of all relevant records available to the Applicant at that point in
time;
• identification of any relevant records or witnesses that are unavailable and the
reasons for the unavailability, including specifics of any evidence destruction
or attempts to obstruct the investigation;
International Issues
• whether the Applicant has made, or will make, an application for immunity or
leniency in other jurisdictions and the identity of those jurisdictions; and
Private Actions
• whether the Applicant is a defendant in any civil actions in Canada, or else-
where, respecting the conspiracy and the general status of any such civil
actions.
Q19 — At what point will the Bureau consider an Applicant’s proffer to be
complete?
806
Leniency Program
The Bureau considers a proffer to be complete when it has received sufficient infor-
mation to make a leniency recommendation to the PPSC. At the request of the
Bureau, the Applicant must advise the Bureau, in a manner that does not waive any
legal privilege, of the progress of its internal investigation so that the Bureau can
determine if information may be lacking. The Bureau expects that Applicants will
continuously provide any new information they become aware of to the Bureau and
that Applicants will provide timely responses to any questions the Bureau may
have.
Q20 — What happens after a proffer has been provided and found to be
complete?
After an assessment of an Applicant’s completed proffer, the Bureau will present
the information to the PPSC in support of the Bureau’s sentencing and leniency
recommendation to the PPSC. While the PPSC will give the Bureau’s recommen-
dation due consideration, the PPSC has final independent authority to decide if it
will enter into a plea agreement with an Applicant and recommend leniency to the
court. The PPSC’s policy on plea agreements is set out in the Federal Prosecution
Service Deskbook.20
Depending on the circumstances, the Bureau may require further information, in-
cluding evidence in the form of records or interviews with the Applicant’s prof-
fered witnesses, to complete its leniency recommendation or pursue other investi-
gative steps, such as search warrant applications. Any records provided to the
Guidelines
Bureau at this stage are treated as confidential or privileged, as described in Section
6 of the Leniency Bulletin. The Bureau will not return records to the Applicant.
Q21 — What if an Applicant cannot meet the 30 calendar day deadline? Will
the leniency marker lapse or be cancelled?
If an Applicant believes that it is incapable of completing its proffer within 30 cal-
endar days, it must communicate this fact and the reasons for the delay to the SDC
as soon as possible. The Applicant should be prepared to provide the SDC with
information on the status of its internal investigation, a detailed proposed workplan
for completing its proffer, and an update on the status of its cooperation with other
agencies.
The SDC will then decide whether any delay in cooperation is reasonable and,
where appropriate, establish a revised schedule for delivery of the proffer. Where
the SDC has particular concerns with an Applicant’s timing, the SDC may request
an undertaking from the Applicant that it will provide the information by a speci-
fied date, together with an acknowledgement that its leniency marker will automati-
cally lapse if the undertaking is not fulfilled.
A delay may be warranted in complex cases, particularly where multiple jurisdic-
tions are involved and information is difficult to gather or where a key witness is
unavailable. The Bureau will not accept delays solely because an Applicant has
20 The Federal Prosecution Service Deskbook.
807
Leniency Program
commitments arising out of immunity or leniency applications in other jurisdictions

or because the Applicant’s counsel is unavailable. Applicants should alert the Bu-
reau to any impediments to complying with the Bureau’s required schedule as early
in the process as possible to avoid prejudice to the Bureau’s investigation.
In the absence of an extension to complete a proffer, delays may result in the auto-
matic lapsing of the Applicant’s leniency marker. They may also result in a reduc-
tion in the Bureau’s recommended leniency discount for an Applicant.
Q22 — Are both written and oral proffers accepted?
Yes. The Bureau accepts both oral and written proffers. The Bureau is sensitive to
the concerns of Applicants about written proffers and other exchanges and, as a
result, it has developed a “paperless process” when dealing with Applicants.
In oral proffers, Bureau staff take detailed notes of the information. Applicants
should take special care in an oral proffer to ensure that all information is clearly
stated in a manner that allows sufficient time for note-taking and that counsel for
the Applicant and the Bureau officers are in agreement regarding the information
provided. Accuracy is critical since the Bureau relies on the information to assess
the leniency application, to develop its leniency recommendation and to pursue its
investigation. As described in the response to question 16 above, proffers are gen-
erally provided by an Applicant’s counsel on a “without prejudice” basis.
Q23 — When should an Applicant raise potential legal defences?
The Bureau expects Applicants to act in good faith with a view to their participa-
tion in the Leniency Program, and their intention to plead guilty and resolve their
legal liability. If an Applicant believes that it may have a potential legal defence in
respect of its conduct, it should raise this with Bureau officers as soon as possible
in the proffer process so that the Bureau may assess its position.
If the Bureau concludes that there is evidence of an offence, the Applicant must
decide whether or not to pursue its leniency application. The Bureau does not ex-
pect that Applicants will complete the proffer process only to raise potential legal
defences after a leniency recommendation has been made by the Bureau to the
PPSC, such that the requirement to plead guilty is rendered ineffective for all of the
proffered conduct.
Step 3: — Lenient Treatment Recommendation to the PPSC

Q24 — How does the Bureau devise the amount of its recommended fine for
Applicants?
Unless there is relevant, compelling and readily accessible evidence to the contrary,
20 percent of an Applicant’s affected volume of commerce in Canada is the rele-
vant starting point for the Bureau’s recommended fine. The 20 percent figure in-
cludes two components:
• 10 percent of the affected volume of commerce in Canada as a proxy for the
overcharge resulting from the cartel activity and other types of economic
harm; and
808
Leniency Program
• 10 percent of the affected volume of commerce in Canada for deterrence and

to ensure that the fine is sufficiently large enough so that it does not represent
a mere licensing fee or cost of doing business.
The fine level, estimated using 20 percent of the Applicant’s affected volume of
commerce in Canada, may be adjusted up or down depending on the weight as-
signed by the Bureau to relevant aggravating or mitigating factors. Bureau officers
will then assign the appropriate discount to the fine (e.g., 50 percent for the first-in
Applicant, provided that it meets the requirements of the Leniency Program, in-
cluding full, frank, timely and truthful cooperation).
In cases where 20 percent of an Applicant’s affected volume of commerce in Can-
ada is greater than the statutory maximum, the starting point of the Bureau’s assess-
ment of the fine level for that Applicant will be the statutory maximum.
Q25 — How does the Bureau determine its fine recommendation in the case of
a market allocation agreement where a party agrees not to sell into Canada?
In the case of international market allocation agreements, the fine recommendation
will be fact-specific and determined on a case-by-case basis. In making its recom-
mendation, the Bureau will consider the volume of commerce covered by the rele-
vant agreements or arrangements and the need to deter and denounce market alloca-
tion agreements or arrangements. All participants to the agreement or arrangement
may be subject to a penalty whether or not they had any sales of the affected prod-
Guidelines
uct in Canada.
Q26 — How does the Bureau determine its fine recommendation in a bid-rig-
ging case?
In a bid-rigging case, the fine recommendation will be fact-specific and determined
on a case-by-case basis. In making its recommendation, the Bureau will consider
the total volume of commerce covered by the relevant agreements or arrangements
and the need to deter and denounce bid-rigging. All participants in a bid-rigging
offence are subject to a penalty whether or not they submitted a bid or agreed to
withdraw a previously submitted bid, and whether or not they were ultimately cho-
sen to supply the product for which they submitted a bid.
Q27 — How is the Immunity Plus discount calculated?
Where an Applicant qualifies for a recommended Immunity Plus discount, the Bu-
reau will typically recommend that an additional five to 10 percent be added to the
Applicant’s leniency discount.21 The size of the recommended Immunity Plus dis-
count will depend on a number of factors relating to the conduct for which immu-
nity is available, including the strength of the evidence provided by the Applicant
and the estimated significance of the case brought forward by the Applicant, mea-
sured in such terms as the affected volume of commerce in Canada, the geographic
21 For more information on the concept of Immunity Plus, an Applicant should refer to
question 43 of the Bureau’s Immunity Program FAQs.
809
Leniency Program
scope of the conduct in question, and the number of co-conspirator organizations

and individuals involved in the conduct in question.
This discount will be applied only where all conditions of cooperation under the
Immunity Program and Leniency Program are met by the Applicant.
Q28 — How is the issue of indirect sales treated under the Leniency Program?
Indirect sales into Canada occur when a cartelized product is used as an input into
an intermediate or final product manufactured abroad that is subsequently sold to a
purchaser in Canada. Where the Applicant or the Bureau has evidence of indirect
sales into Canada, the Bureau expects or may request, as applicable, that an Appli-
cant provide information in its possession to assess the Applicant’s potential liabil-
ity for such sales. The Bureau will, where necessary, work with the Applicant to
develop a feasible methodology to estimate the affected volume of commerce asso-
ciated with its indirect sales into Canada.
For the purpose of a fine recommendation, the Bureau may choose to apply the
approach described in question 24 to an Applicant’s indirect sales into Canada.
Such sales will be limited to the volume of commerce related to the value of the
relevant input into the end product sold into Canada. Information regarding the sup-
ply chain will be particularly important in cases involving indirect sales.
Where cartel members are penalized in another jurisdiction for the direct sales that
led to the indirect sales into Canada, the Bureau may consider, on a case-by-case
basis, whether the penalties imposed or likely to be imposed in the foreign jurisdic-
tion are adequate to address the economic harm in Canada from the indirect sales.
Q29 — What if an Applicant has evidence that the overcharge was less than
the Bureau’s proxy?
Where the evidence is readily accessible, compelling and does not require model-
ling by the Bureau, the Bureau will consider relevant evidence provided by Appli-
cants on a timely basis that demonstrates a lower overcharge. The Bureau will not
accept delays in its usual timelines for the proffer arising from the Applicant’s de-
termination of this overcharge.
On the other hand, where the Bureau has compelling evidence indicating a higher
overcharge, it may use this alleged higher overcharge for the purpose of determin-
ing its recommended fine for an Applicant. The Bureau will advise the Applicant of
the existence of compelling evidence indicating a higher overcharge on a timely
basis.
Q30 — When will the Bureau recommend charges for an individual? How
does the Bureau determine fine levels for individuals? When will the Bureau
recommend a custodial sentence?
For the first-in leniency applicant, the Bureau will recommend that no separate
charges be laid against the Applicant’s current directors, officers or employees,
provided that such individuals cooperate with the Bureau’s investigation in a full,
frank, timely and truthful fashion. Agents and former directors, officers and em-
ployees of the first-in leniency applicant implicated in the offence will also usually
qualify for immunity, provided that they fully cooperate with the Bureau’s investi-
810
Leniency Program
gation and any subsequent prosecutions. The Bureau will make a determination
regarding agents and former directors, officers and employees on a case-by-case
basis, for example, depending on the current employment status of such individuals
(e.g., if they are currently employed by another party to the offence).
For the second-in and any subsequent leniency applicant, the Bureau will consider,
on a case-by-case basis, whether or not to recommend that a current or former di-
rector, officer, employee or agent be charged. In making its decision, the Bureau
will have regard to the general sentencing principles in Canada set out in the Crimi-
nal Code and the relevant jurisprudence. In particular, without limiting the general-
ity of the abovementioned, the Bureau will have regard to the individual’s role and
extent of involvement in the offence (e.g., as the cartel instigator, leader or coordi-
nator, or if they have used coercion, or otherwise monitored or encouraged compli-
ance with the illegal arrangement from other participants); the degree to which the
individual benefited from the offence; whether the individual is a recidivist or has a
criminal record; and any other relevant aggravating or mitigating factors.
The Bureau is increasingly recommending imprisonment for cartel violations so as
to secure sufficient specific and general deterrence and to denounce cartel conduct.
Factors that influence a decision to recommend imprisonment include, but are not
limited to: the degree to which the individual benefited from the offence; whether
the individual was an instigator, leader or coordinator of the cartel conduct;
whether the individual used coercion, or monitored or encouraged compliance with
Guidelines
the illegal arrangement by other participants to the cartel conduct; whether the indi-
vidual is a recidivist or has a criminal record; and any further relevant aggravating
factors.
The Bureau’s recommendation of an appropriate level of a fine for an individual is
based on many of the same factors that influence a decision to charge an individual,
including: the individual’s role and extent of involvement in the offence; the degree
of personal benefit or gain resulting from participation in the offence; whether the
individual is a recidivist or has a criminal record; and any other relevant aggravat-
ing or mitigating factors.
Q31 — Does the PPSC always follow the Bureau’s leniency recommendation?
The PPSC has independent discretion to accept or reject the Bureau’s leniency rec-
ommendation. However, the Federal Prosecution Service Deskbook provides that
the PPSC should consult with the Bureau and give due consideration to its recom-
mendation. The Memorandum of Understanding between the Commissioner of
Competition and the Director of Public Prosecutions sets out the relationship be-
tween the Bureau and the PPSC, as well as each organization’s roles and
responsibilities.22
22 Memorandum of Understanding.
811
Leniency Program
Step 4: — Plea Agreement

Q32 — What is a plea agreement?
A plea agreement between the Director of Public Prosecutions (DPP) and an Appli-
cant establishes the agreed terms and conditions under which the Applicant is
granted leniency in sentencing. The agreement sets out the Applicant’s obligations
to provide full, frank, timely and truthful disclosure and cooperation throughout the
Bureau’s investigation and any subsequent prosecutions. It also states who is cov-
ered by the agreement, how information provided by the leniency recipient will be
treated and under what circumstances the agreement can be revoked. The PPSC’s
policy on plea agreements is set out in Chapter 20 of the Federal Prosecution Ser-
vice Deskbook.23
Q33 — Can an organization be part of the Leniency Program without plead-
ing guilty to an offence?
No. One of the requirements of the Leniency Program is that an organization be
prepared to plead guilty to a cartel offence under the Act. Accordingly, alternative
case resolutions and section 34(2) prohibition orders, which do not require a guilty
plea, are not available under the Leniency Program.
Q34 — What if an Applicant is unable to pay the fine?
In cases where the PPSC determines that an Applicant’s ability to pay should be
considered, the Bureau will critically assess the claim. Claims must be supported
by strong evidence before any reduction in the fine or an adjusted payment sched-
ule will be recommended by the Bureau to the PPSC. An organization will be re-
quired to provide financial information about its assets, liabilities, revenues and
equity.
To make a recommendation to the PPSC, the Bureau may request that an indepen-
dent third-party expert accountant review the organization’s financial information
at the expense of the Applicant. In the case of an individual, he or she will be
required to provide information about his or her financial circumstances, including
all sources of income, property, bank and investment records, tax filings and other
relevant records necessary to make a determination as to his or her ability to pay.
Step 5: — Full Disclosure

Q35 — What information is an Applicant required to provide the Bureau af-
ter entering into a plea agreement?
After an Applicant enters into a plea agreement with the DPP, the Applicant must
complete the full disclosure process. The Bureau requires full, frank, timely and
truthful disclosure of all non-privileged information, evidence or records in the Ap-
plicant’s possession, under its control or available to it, wherever located, that, in
any manner, relate to the anti-competitive conduct.
23 The Federal Prosecution Service Deskbook.
812
Leniency Program
Applicants will be expected to provide all records and other evidence to the Bureau
on a timely basis and witnesses will be expected to be interviewed at the Bureau’s
request. Applicants are expected to take all lawful measures to secure the coopera-
tion of current directors, officers and employees, as well as any agents or former
directors, officers or employees covered by the plea agreement, and to facilitate
their ability to appear for interviews and provide testimony in judicial proceedings
at the Applicant’s expense. Before communicating any information regarding the
investigation to an agent or a former director, officer or employee, the Applicant
must seek the consent of the Bureau or the PPSC.
At the full disclosure stage, the topics addressed by an Applicant will generally be
the same as those addressed at the proffer stage (see the response to question 18
above), but will be covered in greater detail. The Bureau will want to view and
obtain copies of records and interview witnesses. These interviews will, at the dis-
cretion of the Bureau, be under oath and recorded on video or audio tape. The full
disclosure process can be expensive and time-consuming, and the Applicant must
be prepared to dedicate the appropriate resources to support the Bureau’s interest in
conducting an expeditious and thorough investigation.
Applicants have a positive obligation to update all information and evidence
promptly as they become aware of either new or corrected information, records or
witnesses. This must be done on an ongoing basis regardless of whether or not the
Bureau has specifically asked for the information.
Guidelines
Accuracy of the information provided to the Bureau is critical. The Bureau relies
on this information to pursue its investigation of other participants to the alleged
offence. Because timelines in an investigation can be critical, an Applicant’s lack
of timely cooperation can jeopardize the Bureau’s investigation. An Applicant that
provides false or misleading information to the Bureau or fails to fully cooperate in
accordance with its obligations under the plea agreement may face revocation of
the plea agreement.
The Applicant may also face a criminal charge of obstructing a Bureau inquiry or
examination under section 64 of the Act or of destroying or altering records under
section 65 of the Act. Providing false or misleading information can also lead to
charges, including perjury or obstruction, under the Criminal Code.
Q36 — How soon do witnesses and records need to be made available after the
plea agreement is signed?
An Applicant is required to provide full, frank, timely and truthful cooperation to
the Bureau and the PPSC, at its own expense, throughout the Bureau’s investiga-
tion and any subsequent prosecutions. Except for an exceptional circumstance, this
means that the Applicant must make records and witnesses available as soon as
practicable after the plea agreement is signed.
The Bureau will often want to schedule interviews with key witnesses very soon
after a plea agreement is signed. Relevant records may be used in witness inter-
views and, when requested by the Bureau, should be provided to the Bureau by the
Applicant at least two weeks before an interview.
813
Leniency Program
Typically, a schedule for disclosure is established by the Bureau early in the leni-
ency process and production of information and records completed within the dis-
closure period, normally within a six-month timeline. Unwarranted delays or fail-
ure to provide access to witnesses arising from other commitments, including those
commitments that arise from immunity or leniency applications in other jurisdic-
tions, may be considered by the Bureau to be a breach of the plea agreement.
Q37 — Will the Bureau discuss its expectations regarding record production
with the Applicant?
Yes. Before providing records to the Bureau, the Applicant must consult with the
Senior Competition Law Officer assigned to the file with respect to their relevance
and scope, as well as with respect to the form in which they will be provided.
Relevant records must be provided in an organized fashion that clearly indicates
evidence of an offence. The Bureau does not need or want records that are not
relevant to the offence — “record dumps” are not acceptable under the Leniency
Program. Applicants are required to discuss their record production with the Bu-
reau on an ongoing basis and to raise any concerns or challenges early in the
process.
Q38 — Do records have to be produced in a certain format?
Yes. The Bureau typically requires that records be produced in electronic format.
Applicants must always discuss the general technical requirements with the Senior
Competition Law Officer assigned to the file. In many instances, it will be neces-
sary to arrange for direct contact between the technical experts for each side to
discuss any issues.
Q39 — What if the Applicant’s records are in a language other than one of
Canada’s two official languages (English and French) or if a witness does not
effectively communicate in one of Canada’s two official languages?
When requested by the Bureau or the PPSC, the Applicant is expected to produce
professionally translated records and to arrange for a professional interpreter to ac-
company its witnesses where necessary. Neither the Bureau nor the PPSC will bear
the cost of translation or interpretation.
Q40 — What happens if a witness refuses to cooperate with the Bureau’s
investigation?
Paragraph 21 of the Leniency Bulletin provides that the Bureau will recommend
that no separate charges be laid against the first-in leniency applicant’s current di-
rectors, officers and employees, as long as such individuals provide full, frank,
timely and truthful cooperation. Agents and former directors, officers and employ-
ees of the first-in leniency applicant will also usually qualify for immunity from
prosecution, provided that they fully cooperate with the Bureau’s investigation and
any subsequent prosecutions.
The Bureau will make a determination regarding agents and former directors, of-
ficers and employees on a case-by-case basis, for example, depending on the cur-
rent employment status of such individuals (e.g., if they are currently employed by
another party to the offence). The cooperation required from such individuals in-
cludes, among other things, an obligation to provide full, frank, timely and truthful
814
Leniency Program
disclosure of all non-privileged information, evidence or records in their posses-

sion, under their control or available to them, wherever located, that in any manner
relate to the anti-competitive conduct. There must be no misrepresentation of mate-
rial facts.
If a witness refuses to provide full, frank, timely and truthful cooperation with the
Bureau’s investigation, the Bureau may make a recommendation to the PPSC that
the witness be excluded from the plea agreement and face prosecution. Typically,
the Bureau will discuss the situation with the witness and provide the witness with
a reasonable opportunity to cooperate with the Bureau’s investigation before mak-
ing such a recommendation to the PPSC. The PPSC may, as a result of the Bu-
reau’s recommendation, or on its own initiative, exclude the witness from the plea
agreement.
Q41 — Are witnesses required to travel to Canada?
Yes. Witnesses for an Applicant must travel to Canada or another mutually conve-
nient location to be interviewed by the Bureau, unless special circumstances justify
an alternate arrangement to which the Bureau must agree. Organizations applying
for leniency are required to cover their own expenses and the expenses of any and
all witnesses who are covered by the plea agreement.
Q42 — Can the plea agreement be revoked?
Yes. As set out in the Leniency Bulletin, the failure of an Applicant to comply with
Guidelines
any of the terms and conditions in its plea agreement may result in revocation of
the agreement.
Where the Bureau becomes aware that an Applicant does not meet or has not met
the terms and conditions set out in its plea agreement, the Bureau may make a
recommendation to the PPSC that the Applicant’s leniency be revoked. Typically,
the Bureau will discuss the situation with the Applicant and provide an opportunity
to the Applicant to address any shortfalls in its conduct as quickly as possible
before making a recommendation for revocation to the PPSC.
As a result of the Bureau’s recommendation, or on its own initiative, the PPSC may
revoke a plea agreement where the Applicant does not meet all of the terms and
conditions of that agreement, and take further action against the Applicant as ap-
propriate in the circumstances. Where the PPSC determines that the Applicant has
failed to fulfil the terms and conditions set out in its plea agreement, the PPSC will
provide a minimum of 14 calendar days notice to the Applicant so that it has an
opportunity to remedy its failure before revoking the plea agreement.
Q43 — If an organization’s plea agreement is revoked, will its directors, of-
ficers, employees and agents who are covered by the agreement also lose their
lenient treatment?
Revocation of a plea agreement will affect only the individual or organization that
is not cooperating or that otherwise fails to comply with the plea agreement. An
organization’s plea agreement can be revoked while its cooperating directors, of-
ficers, employees or agents who are covered under the agreement retain their pro-
tection. Likewise, it is possible for an individual’s coverage under a plea agreement
to be revoked while the individual’s organization remains covered.
815
Leniency Program
Step 6: — Court Proceedings

Q44 — What is the Bureau’s role at this stage of the leniency process?
The Bureau plays a supporting role to the PPSC at this stage of the leniency pro-
cess. For further information, please consult the Memorandum of Understanding
between the Commissioner of Competition and the Director of Public
Prosecutions.24
Q45 — Is the guilty plea public?
Yes, it is public, along with the documents substantiating the plea. A Statement of
Admissions and Agreed Facts will be filed with the court and/or oral representa-
tions will be made by the PPSC to the court outlining the nature of the cartel of-
fence, the Applicant’s role in the offence and other relevant details, including the
relevant product, the duration of the cartel and the affected volume of commerce in
Canada. The Statement of Admissions and Agreed Facts and/or the oral representa-
tions by the PPSC are used to establish to the court’s satisfaction the commission of
the offence and to substantiate the representations made in the joint sentencing sub-
mission to the court.
Q46 — Can an Applicant place conditions on the timing of a plea?
As noted in paragraph 32 of the Leniency Bulletin, the Bureau will not recommend
that the PPSC delay the filing of the indictment at the request of the Applicant
unless there are compelling reasons to do so and provided that the investigation or
prosecution of other parties will not be materially impacted. The Bureau will not
recommend a plea delay only because a party does not want to be the first party to
plead guilty or because it does not want to be the only party to plead guilty at a
specific time. After the plea agreement is executed, the timing of the resulting plea
is at the discretion of the PPSC and the courts.
Once an Applicant agrees to plead guilty, the Bureau is committed to pursuing the
investigation of the other organizations and individuals that are implicated.
Other
Q47 — To qualify for leniency, an Applicant is required to stop participating
in the conduct in question, but doing so may alert other parties to the offence
that the Applicant has approached the Bureau and this may affect the Bu-
reau’s investigation. What should an Applicant do?
Applicants are required to stop participating in the illegal activity to qualify for
leniency. At the earliest opportunity, Applicants should raise with the Bureau any
concerns they have about what they can or cannot do to comply with this require-
ment and the possible impact that non-compliance could have on the Bureau’s
investigation.
24 Memorandum of Understanding.
816
Leniency Program
Q48 — Securing the cooperation of directors, officers, employees and agents

may alert other parties to the offence that the Applicant has approached the
Bureau and this may affect the Bureau’s investigation. What should the Appli-
cant do?
Organizations should conduct an internal investigation of the illegal activity and
secure the cooperation of potential witnesses in a manner that is consistent with
confidentiality obligations under the Leniency Program. At the earliest opportunity,
and before taking specific steps, Applicants should raise with the Bureau, and if
necessary the PPSC, any concerns they have about confidentiality and the possible
impact this could have on the Bureau’s investigation.
Q49 — Will information provided by an Applicant be shared with foreign law
enforcement agencies?
As set out in paragraph 43 of the Leniency Program, the Bureau will not disclose
the identity of an Applicant or the information provided by that Applicant to any
foreign law enforcement agency without the consent of the Applicant or unless re-
quired by law (e.g., in response to an order of a Canadian court of competent juris-
diction). This confidentiality protection is an added benefit afforded to Applicants
under the Bureau’s Leniency Program.
It is important to note, however, that as part of an Applicant’s ongoing cooperation,
without compelling reasons, the Bureau will expect a waiver allowing communica-
Guidelines
tion of information with jurisdictions to which the Applicant has made similar ap-
plications for immunity or leniency. Such waivers are to be provided immediately
and are expected to cover both substantive and procedural information.
Q50 — Can foreign counsel represent an Applicant before the Bureau or must
a Canadian lawyer be involved?
Typically, a Canadian lawyer represents the Applicant in its dealings with the Bu-
reau, although foreign counsel may be present at certain meetings. When in Can-
ada, foreign counsel must ensure that they are acting in accordance with the re-
quirements of the relevant provincial law society or bar association.
Q51 — What about an Applicant’s obligations as a member of a joint defence
agreement in a civil action?
An Applicant’s first obligation is to provide full, frank, timely and truthful coopera-
tion to the investigation and prosecution of the offence for which leniency is
sought.
Arrangements entered into in respect of a coordinated defence to a civil action must
be subordinate to the overriding commitment owed under the Leniency Program
and the terms of the plea agreement. Moreover, the Applicant must keep the Bureau
and the PPSC apprised on an ongoing basis of the general status of any civil action
in which it is involved.
Q52 — Can an Applicant provide early disclosure in a civil action to obtain
credit for cooperation?
The Bureau has no interest in forestalling cooperation, or in penalizing an Appli-
cant for cooperating in a civil action. In the event that an Applicant wishes to coop-
817
Leniency Program
erate with a civil litigant in exchange for “credit” in respect of any civil liability
that may be owed, this interest should be communicated as early as possible to the
Bureau and the PPSC. This will enable the Bureau and the PPSC to determine how
the Applicant might provide cooperation in the civil action without jeopardizing the
Bureau’s criminal investigation or the PPSC’s prosecution. Failure by an Applicant
to advise the Bureau and the PPSC of its activities in this regard may jeopardize the
Applicant’s status under the Leniency Program.
818
ABUSE OF DOMINANCE ENFORCEMENT
GUIDELINES*
Enforcement guidelines
March 7, 2019
Preface
The Competition Bureau (the “Bureau”), as an independent law enforcement
agency, ensures that Canadian businesses and consumers prosper in a competitive
and innovative marketplace. Headed by the Commissioner of Competition (the
“Commissioner”), the Bureau investigates anti-competitive practices and promotes
compliance with the laws under its jurisdiction, including the Competition Act (the
“Act”).1
Competition among firms underpins a robust economy, incentivizing the creation
of value and rewarding entrepreneurship and innovation. When firms compete on
Guidelines
the merits, market forces generally deliver the most efficient and beneficial eco-
nomic outcomes for society.
In some cases, however, dominant firms can frustrate this process by engaging in
conduct that undermines competitive market forces, leading to inefficient out-
comes. In these rare circumstances, the Bureau may rely upon the abuse of domi-
nance (and other) provisions of the Act to address specific conduct and restore the
competitive process.
These guidelines describe the Bureau’s general approach to enforcing the abuse of
dominance provisions (sections 78 and 79 of the Act). They supersede all previous
guidelines and statements of the Commissioner or other Bureau officials regarding
the administration and enforcement of the Act’s abuse of dominance provisions.
The Abuse of Dominance Enforcement Guidelines do not replace the advice of
legal counsel and are not intended to restate the law or to constitute a binding state-
ment of how the Commissioner will proceed in specific matters. The decisions of
the Commissioner and the ultimate resolution of issues will depend on the particu-
lar circumstances of the matter in question.
* Abuse of Dominance Enforcement Guidelines, Innovation, Science and Economic

1 RSC 1985, c C-34.
819
Abuse of Dominance Enforcement Guidelines
Throughout these guidelines, judicial decisions are referenced by abbreviations.

Full citations may be found at the end of the document. Any reference to jurispru-
dence represents the Bureau’s interpretation of the law.
Final interpretation of the law is the responsibility of the Competition Tribunal (the
“Tribunal”) and the courts.
820
Table of contents
Executive Summary . . . . . . . . . . . . . . . 821
1. Dominance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 823
2. Anti-competitive Acts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 836
3. Competitive Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 844
4. Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 847
5. Illustrative Examples . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 850
Full citations of judicial decisions . . . . . . . . . . . . . . . . . . . . . . . . . . 866
Executive Summary
i. Abuse of a dominant position occurs when a dominant firm or a dominant group
of firms engages in a practice of anti-competitive acts, with the result that competi-
Guidelines
tion has been, is, or is likely to be prevented or lessened substantially in a market.
Simply being a dominant firm, or even a monopoly, does not in and of itself engage
the abuse of dominance provisions of the Act.
ii. Three elements must be established to constitute an abuse of dominance under
section 79 of the Act:
• one or more persons must substantially or completely control a class or spe-
cies of business throughout Canada or any area thereof;
• that person or those persons must have engaged in (within the previous three
years) or be engaging in a practice of anti-competitive acts; and
• the practice must have had, be having or be likely to have the effect of
preventing or lessening competition substantially in a market.
iii. To evaluate the first element, dominance, the Bureau generally first defines a
market(s), and then evaluates whether the allegedly dominant firm (or firms) sub-
stantially or completely controls that market, i.e., has a substantial degree of market
power within that market. In this context, markets are defined in reference to both a
product and geographic dimension, based on demand substitution in the absence of
alleged anti-competitive conduct. The Bureau then considers evidence of the exis-
tence and magnitude of market power, such as market shares and barriers to entry.
iv. The second element considers the purpose of the impugned acts: whether the
dominant firm (or firms) has engaged in a practice of conduct intended to have a
predatory, exclusionary or disciplinary negative effect on a competitor. Exclusion-
ary acts may make current or potential competitors less effective, for example by
increasing their costs. Predatory acts involve a firm deliberately setting the price of
821
a product(s) below an appropriate measure of its own cost to eliminate, discipline,

or deter entry or expansion of a competitor. Disciplinary acts involve actions in-
tended to dissuade an actual or potential competitor from competing vigorously, or
otherwise disrupting the status quo in a market.
v. When evaluating the purpose of an act, the Bureau considers both subjective
evidence of intent (for example, business documents describing the purpose of an
act) as well as objective evidence in the form of the reasonably foreseeable conse-
quences of an act. The Bureau will weigh any evidence of anti-competitive intent
against evidence that the act was engaged in pursuant to a legitimate business justi-
fication, that is, evidence that indicates the purpose of the act was efficiency-en-
hancing or pro-competitive.
vi. The final element involves an analysis of whether competition — on prices,
quality, innovation, or any other dimension of competition2 — would be substan-
tially greater in a market in the absence of the anti-competitive conduct. This as-
sessment is a relative one, comparing the level of competition in a market with and
without the alleged anti-competitive conduct, rather than an assessment of whether
the absolute level of competition in a market is sufficient. The Bureau considers
effects on both static competition (e.g., short-run prices and output), as well as dy-
namic competition (e.g., rivalry driven by product or process innovation).
vii. On application to the Tribunal, the Bureau must establish each element of sec-
tion 79 on the balance of probabilities. To this end, when evaluating conduct under
section 79, the Bureau considers whether clear, convincing, and cogent evidence
exists in support of each element. The Bureau evaluates the body of evidence on
the whole, and may consider the same evidence in reference to more than one ele-
ment. As a result, the Bureau’s analysis of different elements is often
interconnected.
viii. Where all three elements of section 79 are present, the Tribunal may prohibit
the person (or persons) who engaged in the conduct from continuing to do so. In
addition, or alternatively, if the Tribunal concludes that a prohibition order is not
likely to restore competition, it may make an order directing the person (or persons)
who engaged in the conduct to take any action that is reasonable and necessary to
overcome the anti-competitive effects of the practice, including the divestiture of
assets or shares. Finally, if the Tribunal issues a remedial order, it may also order
the respondent to pay an administrative monetary penalty of up to $10 million (or
$15 million for each subsequent order) to promote practices by that person (or per-
sons) that are in conformity with the purposes of section 79.
ix. When enforcing section 79, a significant consideration for the Bureau is to avoid
chilling or deterring pro-competitive or efficiency-enhancing conduct. The Bureau
recognizes that it is often challenging to distinguish anti-competitive conduct from
2 To simplify the discussion, unless otherwise indicated, the term “price” in these guidelines
refers to all dimensions of competition, such as quality or innovation. References to an in-
crease in price encompass an increase in the monetary price, but may also refer to a reduc-
tion in quality, product choice, service, innovation or other dimensions of competition.
822
aggressive competition on the merits, as in many cases the goal of aggressive com-
petition is to marginalize rivals or eliminate them from a market. The Bureau rec-
ognizes that firms may acquire a dominant position by simply out-competing their
rivals, for example, by offering higher quality products to consumers at a lower
price. In these cases, sanctioning firms for simply being dominant would under-
mine incentives to innovate, outperform rivals and engage in vigorous competition.
Such vigorous competition is the sort of competitive dynamic that the Act is de-
signed to preserve and, where possible, enhance, as it ultimately leads to a more
efficient allocation of resources.
x. In considering enforcement action under section 79 of the Act, the Bureau care-
fully evaluates allegations of abuse of dominance on a case-by-case basis, in the
context of structural and other market-specific characteristics. In the course of an
examination or inquiry, the Bureau will typically afford parties the opportunity to
respond to the Bureau’s concerns regarding alleged contraventions of section 79
and discuss an appropriate resolution to address them.
1. — Dominance
1. Paragraph 79(1)(a) of the Act requires an assessment of whether “one or more
persons substantially or completely control, throughout Canada or any area thereof,
a class or species of business.” In other words, this first element of the Act’s abuse
of dominance provision requires a finding of “dominance”.
Guidelines
2. Four factors are relevant to assessing dominance:
i. a “class or species of business” — generally, a product market;
ii. “in Canada or any area thereof” — generally, a geographic market;
iii. “control” — a substantial degree of market power; and
iv. “one or more persons” — joint dominance.3
3. Market definition in abuse of dominance cases is an analytical tool that may
assist with the determination of whether a firm is dominant.4 The Tribunal has rec-
ognized that often it is neither possible nor necessary to precisely define a market
(or markets) in proceedings under section 79.5 In some cases, it may be clear that a
firm is dominant under all plausible market definitions.
3 For the remainder of this document the terms “firm”, “person”, and “entity” will be used
interchangeably. Similarly, unless otherwise indicated, any reference to a single allegedly
dominant person should be read to include reference to either a single dominant person or
multiple dominant persons.
4 As discussed further below, the Bureau may define different markets for the purposes of
paragraphs 79(1)(a) and 79(1)(c). As such, market definition is also relevant to the assess-
ment of competitive effects.
5 TREB CT at para 132.
823
4. While the following discussion contemplates defining markets in the context of

selling goods or services, a similar exercise can be conducted when defining input
markets from the perspective of a dominant buyer.
A. — “Class or Species of Business”: Product Market

5. For the purposes of paragraph 79(1)(a), the Tribunal has held that a “class or
species of business” is synonymous with a product market(s).6
6. Defining product markets usually begins by examining the product in respect of
which the alleged abuse of dominance has occurred or is occurring, and determin-
ing whether close substitutes exist for that product, focusing on demand responses.7
7. The “hypothetical monopolist test” provides a useful framework to conceptualize
substitutability between products — an analytical framework the Tribunal has rec-
ognized can be helpful in cases under section 79.8 The Bureau considers whether a
profit-maximizing hypothetical monopolist would impose and sustain a small but
significant and non-transitory price increase for a candidate set of products above a
given benchmark. In general, the smallest set of products in which the price in-
crease would be sustained, including the product in respect of which the alleged
abuse of dominance has occurred or is occurring is defined as the product market.
8. Typically, the initial candidate market considered is a product in respect of
which the alleged abuse of dominance has occurred or is occurring and its closest
substitute. If a hypothetical monopolist could not impose a small but significant and
non-transitory price increase above the benchmark, assuming the terms of sale of
all other products remained constant, the candidate market is expanded to include
the next-best substitute (which could include the products of other firms). The anal-
ysis is repeated until the point at which the hypothetical monopolist would profita-
bly impose and sustain such a price increase over the candidate market.
9. For purposes of the hypothetical monopolist test, the Bureau generally considers
a 5 percent price increase above the price level that would prevail absent the al-
leged anti-competitive act(s) to be significant and a one-year period to be non-tran-
sitory. Market characteristics may support using a different price increase or time
period.
10. It is important to note that, in the context of abuse of dominance cases, the
current price may not be the appropriate benchmark to use when defining the mar-
ket, as some products that appear to be good substitutes at that price level might not
be considered substitutes at price levels that would have prevailed in the absence of
6 NutraSweet at 9. The term product also encompasses services (see subsection 2(1) of the
Act).
7 The Bureau considers supply responses, or the ability of potential competitors to begin
supplying in response to a price increase, when assessing the “control” element of paragraph
79(1)(a), such as when assessing market shares and participants, rather than when defining
markets.
824
the alleged anti-competitive act(s).9 Inclusion of these products could lead to an

overly broad product market definition because these products do not discipline the
market power of the dominant firm, but rather are only considered substitutes for
products in the market at price levels where market power has already been
exercised.
11. Direct evidence of buyer switching (i.e., changes in quantities purchased) in
response to relative price changes can demonstrate substitutability for the purposes
of market definition.10 However, in practice, such direct evidence may be difficult
to obtain.
12. For the above reasons, market definition for the purposes of section 79 will
often focus on indicators of substitutability. Such indicators include:
Views, strategies, behaviours and identity of buyers:
Whether buyers have substituted between products in the past, and whether
they plan to do so in the future, can indicate whether a price increase in a
candidate market is sustainable. Industry surveys, industry participants and in-
dustry experts may also provide helpful information with respect to products
that may be substitutable. Documents prepared by the firm in question in the
ordinary course of business may also prove useful in this regard.
End-use and physical characteristics:
Functional interchangeability between two products is generally a necessary,
Guidelines
but not sufficient, condition to warrant inclusion in the same market. In gen-
eral, as buyers place greater value on the actual or perceived unique physical
or technical characteristics of a product, the more likely it is that the product
will fall within a distinct market.
Switching costs:
Transaction costs that buyers would have to incur to, among other things,
retool, repackage, adapt their marketing, breach a supply contract or learn new
procedures may render product substitution an unlikely response to a small but
significant and non-transitory price increase.
Price relationships and relative price levels:
The presence of a strong correlation in price movement between two or more
products over a significant period of time may suggest that the products fall
within the same market.
9 TREB CT at paras 129-130.

10 When detailed data on the prices and quantities of the relevant products and their substi-
tutes are available, statistical measures may be used to define product markets. Demand elas-
ticities indicate how buyers change their consumption of a product in response to a change in
the product’s price (own-price elasticity) or in response to changes in the price of another
identified product (cross-price elasticity). While cross-price elasticities do not directly mea-
sure the ability of a firm to increase price, they are particularly useful for determining
whether differentiated products are close substitutes for one another.
825
13. The Bureau may consider it appropriate to define markets in reference to partic-
ular types of purchasers in certain circumstances, such as where sellers engage in
price discrimination between different sets of buyers. For example, the Bureau may
define two separate markets if a seller is able to effectively price discriminate be-
tween commercial customers and individual consumers. Similarly, the Bureau may
define markets in reference to a particular level of a supply chain: for example,
when assessing if a manufacturer is dominant in an industry where manufacturers
sell through retailers, the Bureau may define a market as sales to retailers.
14. In some cases the Bureau may consider it appropriate to analyse several differ-
ent (or potentially different) product markets together for the purposes of market
definition. This could occur when evidence indicates that there may be more than
one product market but that competitive conditions are sufficiently similar in each
market such that analyzing them together does not affect the assessment of domi-
nance. Where appropriate, the Bureau may analyse several geographic markets
(discussed below) together in the same manner.
15. The Bureau may define a market as a group of diverse products that are not
themselves substitutes for each other in cases where a sole, profit maximizing seller
would increase the price of the group of the products because a sufficient number
of buyers would not respond to the price increase by purchasing individual prod-
ucts from different sellers. This may occur, for example, where there are suffi-
ciently large transaction costs associated with dealing with multiple sellers.
16. Special considerations arise when applying the hypothetical monopolist test to
“multi-sided” platforms. For a multi-sided platform, demand for one “side” de-
pends on use of another; one example would be an advertising service that matches
buyers and sellers of a product, where greater buyer use increases the attractiveness
to sellers, and greater seller use increases the attractiveness to buyers. Depending
on the facts of a case, the Bureau may define a product market as one side of a
multi-sided platform (i.e., consider the effects of a price increase on one side of the
platform). However, when considering if a hypothetical monopolist would find it
profit maximizing to impose that price increase, it may be necessary to account for
the interdependence of demand, feedback effects, and changes in profit on all sides
of the platform.11 In other cases, the Bureau may view it appropriate to define a
market to include multiple sides of the platform.
17. Additionally, challenges may arise in the application of the hypothetical mo-
nopolist test where services are offered at a zero-monetary price (for instance,
where services are offered for free to attract users to a multi-sided platform that
depends on advertisers for monetization). In such cases, firms may compete on
dimensions other than monetary price, such as product quality. Although the Bu-
reau may seek to analyze whether a hypothetical monopolist would find it profit
maximizing to decrease a relevant non-price dimension of competition by a small
11 See Visa at para 189. Similarly, where the Bureau has defined a market as one side of a
platform the Bureau, where appropriate, may consider effects of conduct on multiple sides of
the platform when evaluating issues beyond market definition.
826
but significant amount for a non-transitory period of time, this may not be feasible
in practise. As a result, the Bureau’s analysis may focus on qualitative indicators of
substitutability. This analysis will generally be similar to assessing substitutability
based on qualitative indicators in other cases, as discussed above.
B. — “Throughout Canada or any Area Thereof”: Geographic Market

18. The Tribunal has held that the phrase “throughout Canada or any area thereof”
is synonymous with a geographic market(s).12
19. A geographic market consists of all locations or supply points regarded as close
substitutes by buyers. From a buyer perspective, a geographic market may include
territory outside of Canada. Similar to product market definition, the Bureau will
generally apply the hypothetical monopolist test to examine the dimensions of
buyer switching, from suppliers in one location to suppliers in another, in response
to a small but significant and non-transitory price increase. A geographic market
will consist of all locations or supply points that would have to be included for such
a price increase to be profitable. As with product market definition, the geographic
parameters of the market may be overstated if they include areas that would not be
included at the price level that would prevail absent the alleged anti-competitive
act(s).
20. The Bureau may consider if the area in which the allegedly dominant firm oper-
Guidelines
ates constitutes a geographic market. However, the Bureau may ultimately define
geographic markets more broadly or more narrowly. In the latter case, where an
allegedly dominant firm operates in more than one geographic market, the Bureau
will seek to assess if competitive conditions materially vary across those markets. If
competitive conditions are similar in several geographic markets, the Bureau may
consider them together for analytical purposes.
21. The Bureau will also consider indirect evidence of substitutability between lo-
cations or supply points when defining geographic markets, such as:
Views, strategies, behaviours and identity of buyers:
Considerations relating to convenience or the particular characteristics of the
product (e.g., fragility, perishability) may influence a buyer’s choice of sup-
plier in the event of a price increase. The Bureau will examine past and poten-
tial future behaviour of buyers as new options are made available, through, for
instance, advances in technology, which may impact the geographic dimen-
sion of a buyer’s purchases. Third parties who are familiar with the industry in
question may provide information regarding past and potential future industry
developments that helps to define the geographic market. The extent to which
distant supply locations are taken into account in business plans, marketing
strategies and other documentation of the firm in question and of other sellers
may also be useful indicators of geographic market definition.
Switching costs:
12 NutraSweet at 20.
827
Transaction costs that buyers would have to incur to adapt their business to
obtain the product from another source may render substitution to sources of
supply from other geographic areas an unlikely response to a small but signifi-
cant and non-transitory price increase.
Transportation costs, price levels, and shipment patterns:
In general, where prices in a distant area have historically exceeded or been
lower than prices in the candidate geographic market by more than transporta-
tion costs, this may indicate that the distant area constitutes a separate market,
for reasons that go beyond transportation costs. Conversely, if significant ship-
ments of the product from a distant area in response to a price increase are
likely, this may suggest that the distant area falls within the geographic mar-
ket. In either case, the Bureau will assess whether a small but significant and
non-transitory price increase in the candidate geographic market would change
any locational pricing differential to the point where purchases from distant
sellers may be able to constrain a price increase.
22. While the principles above apply equally to domestic and international sources
of competition, other considerations, such as tariffs, duties, quotas, regulatory im-
pediments, government procurement policies, intellectual property laws, exchange
rate fluctuations and international product standardization may be relevant when
considering whether supply points located outside Canada should be included in the
geographic market.
C. — “Substantially or completely control”: Market Power

23. The Tribunal has held that the phrase “substantially or completely control” con-
templates a substantial degree of market power.13 The Supreme Court of Canada
has defined “market power” as “the ability to ‘profitably influence price, quality,
variety, service, advertising, innovation or other dimensions of competition’”;14 the
Tribunal has characterized a substantial degree of market power as one that “con-
fers upon an entity considerable latitude to determine or influence price or non-
price dimensions of competition in a market, including the terms upon which it or
others carry on business in the market”.15 Market power may be reflected in an
ability to restrict the output of other existing or potential market participants, and
thereby profitably influence price (the “power to exclude”).16
24. When assessing if a firm holds a substantial degree of market power, the Bu-
reau considers the body of relevant information and/or documents on the whole in
order to determine the extent to which a firm has the ability to influence the market.
The exact nature of the Bureau’s analysis and the weight accorded to any particular
piece of information or document will depend on the circumstances of the case.

14 Tervita at para 44.
15 TREB CT at paras 174.
828
25. Market power can be measured directly or indirectly. Direct indicators of mar-
ket power, such as evidence of supra-competitive profitability or pricing, are not
always conclusive or indeed possible to assess; practical difficulties can arise in
defining the “competitive” price level and the appropriate measure of cost to which
prices should be compared.17
26. In many cases the Bureau examines a number of indirect indicators, both quali-
tative and quantitative, in conducting its analysis of market power, such as struc-
tural characteristics of a market (including market shares and any barriers to entry),
the extent of technological change, the effects of a practice of anti-competitive acts,
and customer or supplier countervailing power. The Bureau’s analytical approach
to the assessment of these indicators is discussed in greater detail below.
27. A firm that does not compete in a market may nonetheless substantially or com-
pletely control that market.18 When assessing if a firm holds a substantial degree of
market power in a market in which it does not compete the power to exclude cur-
rent or potential competitors will often be the focus of the Bureau’s analysis. Con-
versely, indicators of market power such as market shares or supra-competitive
profits may not be relevant in such circumstances, whereas they may be central to
assessing market power where the allegedly dominant firm does compete in the
market.
28. In the context of paragraph 79(1)(a), the relevant level of market power in-
cludes not only a firm’s pre-existing market power (i.e., any market power held by
Guidelines
the firm notwithstanding any alleged anti-competitive conduct), but also market
power derived from any alleged anti-competitive conduct.19
i. — Market Shares and Barriers to Entry

29. Jurisprudence has often relied on a combination of high market shares and bar-
riers to entry as evidence of market power. While there is no definitive numeric
threshold, the Bureau is of the view that high market share is usually a necessary,
17 The Tribunal has accepted some direct indicators as evidence of market power, such as a
high price-to-average-cost margin and corresponding high accounting profits. Similarly, sig-
nificant variations in price by region, along with the ability to lower prices in response to
increased competition or entry, has been accepted by the Tribunal as evidence of supra-
competitive pricing in higher-price regions. In these cases, direct indicators alone were insuf-
ficient to establish market power, which was substantiated through the use of indirect indica-
tors. See Tele-Direct at 101 and Canada Pipe CT at para 161.
18 TREB FCA 1 at para 13.
19 The Tribunal has held that the use of the present tense in paragraph 79(1)(a) means that at
the time a person engages in a practice of anti-competitive acts, they must be in a position of
dominance in the market (Direct Energy at para 40). The Bureau may conclude that para-
graph 79(1)(a) is satisfied where a firm attains dominance through a practice of anti-compet-
itive acts, provided that the firm is dominant at some point in time when the practice is
ongoing.
829
but not sufficient, condition to establish the existence of a substantial degree of

market power.20
30. All other things being equal, the larger the share of the market held by competi-
tors, the less likely it is that the firm in question would be capable of exercising a
substantial degree of market power. The ability of customers to switch to competi-
tors if a firm attempts to increase price may be demonstrated by a large market
presence of those competitors. In such cases, switching by a significant portion of a
firm’s customer base may be enough to render any increase in price unprofitable.
However, the ability to switch may depend on various factors such as the speed and
ease with which rival firms are able to accommodate increased demand for their
products as the prices of rival suppliers increase, or any switching costs.
31. In addition to considering the market shares of current sellers of relevant prod-
ucts, the Bureau may also consider the shares of potential sellers that would partici-
pate in the market through a supply response if prices rose by a small but signifi-
cant and non-transitory amount. In such a case, a firm could be considered a
participant in the market if significant sunk investments are not required to enter,
and it could rapidly and profitably divert existing sales or capacity to begin supply-
ing the market in response to such a price increase. For those firms that would
participate in the market through a supply response, market share calculations will
include only the output or capacity that would likely become available to the mar-
ket without incurring significant investment.
32. Market shares can be measured in terms of revenues (dollar sales), demand
units (unit sales), capacity (to produce or sell) or, in certain natural resource indus-
tries, reserves. If products in the market are homogeneous and firms are operating
at capacity, relative market shares should be similar regardless of the unit of mea-
surement. If firms have excess capacity, market shares based on capacity may best
reflect their relative market position if they can easily increase supply in response
to an increase in price. In the case of differentiated products, market shares based
on dollar sales, demand units and/or capacity can lead to varying inferences with
respect to firms’ relative competitive positions, and shares based on revenues or
demand units may be more probative in this regard. When calculating market
shares, the Bureau will use the measurement that it considers best reflects the cur-
rent and future competitive significance of competitors.
33. In contested abuse of dominance cases to date, market shares of those firms
found to have abused their dominant position were very high, suggesting that, in
those instances, customers were left with too few alternatives to discipline a price
increase or other conduct by the firm that substantially lessened or prevented
competition.21
20 However, as discussed in more detail below, in exceptional cases the Bureau may con-
sider firms with relatively low market shares to possess a substantial degree of market power
where other evidence establishes its existence.
21 In Tele-Direct, at 83, the Tribunal stated that it would require evidence of “extenuating
circumstances, in general, ease of entry” to overcome a prima facie determination of control
830
34. In many cases, the Bureau uses market shares as an initial screening mechanism
to assess allegations of abuse of dominance. The Bureau’s general approach is as
follows:
• A market share below 50 percent will generally only prompt further examina-
tion if other evidence indicates the firm possesses a substantial degree of mar-
ket power, or that it appears the firm is likely to realize the ability to exercise a
substantial degree of market power through the alleged anti-competitive con-
duct within a reasonable period of time while that conduct is ongoing;
• A market share of 50 percent or more will generally prompt further examina-
tion; and
• In the case of a group of firms alleged to be jointly dominant, a combined
market share equal to or exceeding 65 percent will generally prompt further
examination.
35. In circumstances where the Bureau has not reached a final conclusion regarding
the boundaries of the market, several plausible market definitions may present
themselves. Where at least one plausible market definition exists that indicates an
allegedly dominant firm possesses a substantial degree of market power, the Bu-
reau may investigate further.
36. The Bureau will also examine the durability of market shares in a particular
market. If market shares have fluctuated significantly among competitors over time
Guidelines
(for example, because firms regularly develop new technologies to “leapfrog” their
competitors), a current high market share may be less indicative of a substantial
degree of market power.
37. Market shares are not the only factor the Bureau considers, and where other
evidence provides sufficient indication that a firm may be dominant regardless of a
relatively low market share the Bureau may investigate further.22 The types of evi-
dence that may prompt the Bureau to investigate further include:
Direct evidence of market power:
Where available, evidence of supra-competitive pricing;
Significant Commercial Leverage:
Market or demand characteristics may provide the allegedly dominant firm
sufficient commercial leverage over upstream or downstream firms such that it
based on market shares of 80 percent and higher; whereas, in Laidlaw, the Tribunal observed
that a market share of less than 50 percent would not give rise to a prima facie finding of
dominance. However, this does not preclude the possibility that a substantial degree of mar-
ket power could be found below that threshold.
22 The Tribunal has recognized that firms with relatively low market shares may possess
some degree of market power. For example, in the context of other provisions of Part VIII of
the Act, the Tribunal has found a firm to possess market power with a share as low as 33
percent (Visa at para 267), and has recognized that market shares may either overstate or
understate a firm’s market power (Hillsdown at 318).
831
may exercise a substantial degree of market power, for example, through the
ability to affect a supplier’s dealings with other customers;
Effects of the Anti-Competitive Acts:
An ability to cause prices to be higher in the market than would exist in the
absence of the firm’s conduct may be evidence of the existence and
or/magnitude of market power on the part of that firm;23 and
Other evidence of influence:
where a firm has otherwise demonstrated “considerable latitude”24 to deter-
mine or influence a relevant dimension of competition.
38. The Bureau anticipates that, all else equal, these types of evidence are less
likely to exist if the market share of the potentially dominant firm is small. How-
ever, there may be circumstances where market shares do not factor into the Bu-
reau’s analysis, for instance, where a firm controls a market through the ability to
exclude, as discussed below.
39. A high market share is not itself sufficient to establish a substantial degree of
market power. A firm’s attempt to exercise market power may be thwarted by ex-
pansion or entry of existing and/or potential competitors on a sufficient scale and
scope if expansion and/or entry are expected to be profitable. As a result, the Bu-
reau considers the extent to which barriers to entry or expansion may limit the abil-
ity of rivals to respond to any exercise of market power. Barriers to entry or expan-
sion can take many forms, including:
Sunk costs of entry or expansion:
Costs are sunk when they cannot be recovered if the firm exits a market. Sunk
costs may pose a barrier to entry or expansion where the anticipated rewards
to entry or expansion are anticipated to be less than the associated sunk costs,
or there is sufficient risk that this will be the case as to have a deterrent effect;
Regulatory barriers:
In addition to their relevance to geographic market definition, regulatory con-
trols relating to entry, tariff and non-tariff barriers to international or domestic
trade may impede entry or expansion by competitors;
Economies of scale and scope:
Economies of scale occur when the average cost of producing a product de-
clines the more of a product is produced, whereas economies of scope occur
where the average costs of producing a product decline with the production of
other products. Instances where such economies can be barriers to entry or
expansion include when economies of scale prevent viable entry on a small
scale or require entry to be on a sufficiently large scale to depress market
prices, or where economies of scope require that a viable entrant must begin
production of various products at once;
23 See, for instance, TREB CT at para 196.

24 See TREB CT at para 174.
832
Market maturity:
Where market demand is not expected to increase, entry or expansion may be
more difficult as any additional business must be converted from incumbents,
rather than growth in market demand. Similarly, it may be easier to enter a
market when it is young or growing, or less attractive to invest in assets that
may be stranded due to decline in market demand;
Network effects:
Network effects occur when demand for a product depends on use of that
product by others, and can be direct or indirect. Direct network effects occur
when the demand for a product or service directly increases with more users,
such as how the value of a communications network for an individual may
increase with the number of other users of the network. In contrast, indirect
network effects occur where greater use of a product or service by members of
one group creates value for members of another group, potentially causing
feedback effects. For example, in the case of a website that matches buyers
and sellers of various products, the website becomes more valuable to buyers
the more sellers use the website, and vice versa. All else equal a buyer may be
indifferent to the number of other buyers that use the website, but if additional
buyers attract additional sellers, a buyer indirectly benefits from greater use of
the website by other buyers. Network effects may provide significant advan-
tages to incumbent firms, making entry or expansion more difficult; and
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Access to scarce or non-duplicable inputs:
An inability to access significant inputs that are required to be a viable com-
petitor in a market may prevent entry or expansion.
40. The Bureau will examine the nature of any barriers to entry, including those
created by the alleged practice of anti-competitive acts,25 to assess whether entry
would be timely, likely, and sufficient in scale and scope to make the exercise of a
substantial degree of market power unsustainable. “Timely” means that entry will
occur within a reasonable period of time; “likely” refers to the expectation that
entry will occur; and “sufficient” means that entry would occur on a sufficient scale
to prevent or deter firms from exercising a substantial degree of market power.
When assessing if entry will satisfy these criteria, the Bureau will generally seek to
determine if the threat of entry or expansion has an appreciable effect on the alleg-
edly dominant firm’s conduct.
ii. — The Ability to Exclude

41. As noted above, the Tribunal has recognized that the ability to exclude — the
ability to restrict the output of other actual or potential market participants, and
thereby profitably influence price — constitutes market power.26 Where through
25 Laidlaw at 331; Tele-Direct, at 95; Canada Pipe CT at paras 138, 146; Canada Pipe FCA
2 at paras 24-25, 36.
833
the impugned conduct assessed under paragraphs 79(1)(b) and 79(1)(c) a firm has
demonstrated its ability to exclude rivals, this provides evidence that it has market
power.27
42. Assessing the existence and degree of market power through the ability to ex-
clude is particularly relevant when a firm does not compete in a market in which
the alleged anti-competitive effects are alleged to be occurring. A firm that does not
compete in a particular market may nonetheless control it, for example, through
control of a significant input to competitors in a market, or the ability to make rules
that effectively control the business conduct of those competitors.28 The Bureau
does not view these two mechanisms as mutually exclusive: for example, a firm
may leverage control of a significant input in order to impose and enforce rules that
affect the business conduct of competitors in a market.
43. When assessing whether a firm controls a significant input in a market in which
it does not compete (e.g., a downstream market), the Tribunal has indicated it is not
necessary to define and establish dominance in an additional market defined around
that input (e.g., an upstream market).29 However, for the purposes of assessing if
control of that input provides the ability to exclude, the Bureau will consider the
extent to which substitutes exist to the input provided by the allegedly dominant
firm, as well as the extent to which that input is necessary to compete. In the ab-
sence of acceptable substitutes, and if competitors in the market are unable to effec-
tively compete without access to the input, the Bureau will conclude the allegedly
dominant firm has a substantial degree of market power in that market (in the ex-
amples above, in the downstream market).
44. When assessing if a firm has the ability to impose rules that govern the conduct
of competitors, the Bureau may consider the extent to which any rules are adhered
to, or could be enforced by the allegedly dominant firm. If such rules are not ad-
hered to or enforced, the Bureau is not likely to conclude the allegedly dominant
firm has a substantial degree of market power on that basis.
iii. — Other Factors

45. The Bureau may examine other potentially relevant indicators when assessing
the existence and/or magnitude of market power, including:
Countervailing power:
A customer or supplier may have the ability and incentive to constrain a firm’s
attempt to exercise a substantial degree of market power, such as by vertically
integrating its own operations; refusing to buy or sell other products or in
other geographic markets from the firm; or encouraging expansion or entry of
existing or potential competitors; and
Technological change and innovation:
27 TREB CT at paras 182, 190, 254(n).

29 TREB CT at paras 203–207.
834
Evidence of a rapid pace of technological change and the prospect of firms

being able to “innovate around” or “leapfrog” an apparently entrenched posi-
tion of an incumbent firm could be an important consideration, along with
change and innovation in relation to distribution, service, sales, marketing,
packaging, buyer tastes, purchase patterns, firm structure and the regulatory
environment.
D. — “One or more persons”: Joint Dominance

46. Section 79 contemplates that a group of firms may jointly substantially or com-
pletely control a market, satisfying paragraph 79(1)(a). The Bureau’s analytical
framework for assessing joint dominance is similar to that employed in examining
single-firm dominance, and likewise focusses on the existence of a substantial de-
gree of market power. Similar to single-firm dominance, the Bureau considers the
ability of a firm or firms to exercise a substantial degree of market power, taking
into account market shares, barriers to entry and expansion and any other relevant
factors. However, in the case of joint dominance, this exercise also requires an as-
sessment of whether those firms that are alleged to be engaged in a practice of anti-
competitive acts jointly control a class or species of business such that they hold a
substantial degree of market power together.
47. As with single-firm dominance, the Bureau will assess the extent to which com-
petition from existing rivals and from potential rivals (i.e., entrants) outside the
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allegedly jointly dominant group is likely to defeat the profitability of a price in-
crease by the firms that are alleged to be jointly dominant. If these two sources of
competition are not likely to constrain a price increase, the Bureau will then con-
sider the nature of competition within the allegedly jointly dominant group.
48. In the absence of a sufficient competitive constraint from outside an allegedly
jointly dominant group, if competition among group members is also insufficient to
constrain prices to the competitive level, members of that group will be able to
jointly exercise a substantial degree of market power. As a result, when assessing
joint dominance, the Bureau may accord significant weight to how vigorously the
allegedly jointly dominant firms compete with each other.30 In the absence of vig-
orous competition the Bureau may conclude that the lack of mutual competitive
constraint permits them to exercise a substantial degree of market power.
49. Similar or parallel conduct by firms is insufficient, on its own, for the Bureau to
consider those firms to hold a jointly dominant position. Further, evidence of coor-
dinated behaviour by firms in the allegedly jointly dominant group may be proba-
tive insofar as it may explain why members of the allegedly dominant group are not
30 Prices that appear to be at or near the competitive level could be evidence of vigorous
competition. Other factors may include, but are not limited to, price competition among
competitors, instability of market shares over time, attempts to solicit rival’s customers, or
“leapfrog” competition through innovation. Conversely, the absence of these factors on the
part of firms within the allegedly jointly dominant group could indicate that these firms are
not competing vigorously with one another.
835
vigorously competing. However, the Bureau does not consider such evidence as
necessary to establish that a group is jointly dominant, if there is other evidence
that competition among members of the allegedly dominant group is not sufficient
to discipline their exercise of a substantial degree of market power.
50. As with single-firm dominance, the ability to exercise a substantial degree of
market power on a collective basis is not in and of itself sufficient to raise an issue
under the abuse provisions of the Act. While a group of firms may collectively be
able to exercise a substantial degree of market power, it is still necessary to estab-
lish that these firms’ conduct constitutes a practice of anti-competitive acts that is
preventing or lessening competition substantially. It may, however, be the case that
a practice of anti-competitive acts facilitates joint dominance. For example, joint
dominance may be enabled or reinforced through disciplinary conduct, as discussed
below.
2. — Anti-competitive Acts
51. Paragraph 79(1)(b) requires that a firm or firms “have engaged in or are engag-
ing in a practice of anti-competitive acts”. This element consists of two factors, the
Bureau’s approach to which is discussed below:
i. a “practice”; and
ii. anti-competitive acts.
A. — A “Practice”
52. While a “practice” normally involves more than one isolated act, the Bureau
considers that this element may be satisfied by a single act that is sustained and
systemic, or that has had or is having a lasting impact in a market.31 For example, a
long-term exclusionary contract may effectively prevent the entry or expansion of
competitors despite the fact that the contract itself could be viewed as a single act.
B. — Anti-competitive Acts
53. Section 78 of the Act enumerates a non-exhaustive list of acts that are deemed
to be anti-competitive in applying section 79.32 An anti-competitive act is defined
by reference to its purpose, and the requisite anti-competitive purpose is an in-
tended negative effect on a competitor that is predatory, exclusionary, or discipli-
31 Canada Pipe FCA 1 at para 60.

32 In addition, subsection 79(5) states that “For the purpose of this section, an act engaged in
pursuant only to the exercise of any right or enjoyment of any interest derived under the
Copyright Act, Industrial Design Act, Integrated Circuit Topography Act, Patent Act, Trade-
marks Act or any other Act of Parliament pertaining to intellectual or industrial property is
not an anti-competitive act.” For information on the Bureau’s approach to reviewing busi-
ness conduct involving intellectual property, see the Bureau’s Intellectual Property Enforce-
ment Guidelines.
836
nary.33 While many types of anti-competitive conduct may be intended to harm

competitors, the Bureau considers that certain acts not specifically directed at com-
petitors could still be considered to have a predatory, exclusionary, disciplinary, or
some other anti-competitive purpose.34 On the latter, by way of example, conduct
aimed at undermining the competitive process and the vigour with which other
firms may compete may be considered as having the requisite anti-competitive
purpose.
54. When assessing whether an act is anti-competitive, the purpose of an act may
be established directly by evidence of subjective intent, inferred from the reasona-
bly foreseeable consequences of the conduct, or both. Although verbal or written
statements of a firm’s personnel may assist in establishing subjective intent, evi-
dence of subjective intent is neither strictly necessary nor completely determina-
tive.35 In most cases, the purpose of the act can be inferred from the circumstances,
and persons are assumed to intend the reasonably foreseeable consequences of their
acts.36
55. In some cases, when evaluating the overall character of a practice, evidence that
the conduct was motivated by a legitimate business justification can outweigh evi-
dence of anti-competitive purpose when the two are balanced against each other.
The role of business justifications in evaluating the purpose of conduct is discussed
further below.
56. For the purposes of paragraph 79(1)(b), a competitor is a person who competes
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in a market, and need not be a competitor of the allegedly dominant firm.37 Thus, a
firm that does not compete in a market may nonetheless engage in a practice of
anti-competitive acts directed toward competitors in that market.
57. Where a firm that does not compete in a market is alleged to have engaged in a
practice of anti-competitive acts, the Tribunal has indicated that it must be satisfied
that the firm has a “plausible competitive interest” in adversely impacting competi-
tion in that market.38 As noted above, the Federal Court of Appeal has character-
ized anti-competitive acts as those that have an intended negative effect on a com-
petitor that is predatory, exclusionary, or disciplinary. Although the Bureau will

34 The Federal Court of Appeal and Tribunal have acknowledged that paragraph 78(1)(f)
does not contain an explicit reference to a purpose vis-à-vis a competitor. The Federal Court
of Appeal has characterized the conduct in paragraph 78(1)(f) as reflecting “a self-serving
intent, not a relative one intended to harm a competitor”, and that on the premise of its
earlier jurisprudence “requiring a predatory, exclusionary, or disciplinary negative effect on
a competitor in all cases would render paragraph 78(1)(f) meaningless” (TREB FCA 2 at
para 54).
35 Canada Pipe FCA 1 at paras 72-73.
36 NutraSweet at 35.
37 TREB CT at para 277; TREB FCA 1 at paras 17–20.
837
typically consider the incentives of a dominant firm to limit competition, the Bu-
reau may conclude that a firm that does not compete in a market has engaged in a
practice of anti-competitive acts where an exclusionary, predatory, disciplinary, or
other anti-competitive purpose can be demonstrated.
58. In assessing whether a particular act is likely to be anti-competitive, the Bureau
is of the view that anti-competitive conduct generally falls into three broad
categories:
i. predatory conduct;
ii. exclusionary conduct; and
iii. disciplinary conduct.
i. — Predatory Conduct
59. Predatory conduct involves a firm deliberately setting the price of a product(s)
below an appropriate measure of its own cost to incur losses on the sale of prod-
uct(s) in the market(s) for a period of time sufficient to eliminate, discipline, or
deter entry or expansion of a competitor, in the expectation that the firm will there-
after recoup its losses by charging higher prices than would have prevailed in the
absence of the impugned conduct.39 Predatory pricing may be implicit (through
discounts or rebates, for example), or explicit.
60. The Bureau considers that average avoidable cost is the most appropriate cost
standard to use when determining if a dominant firm’s prices are below cost.40
Avoidable costs refer to all costs that could have been avoided by a firm had it
chosen not to sell the product(s) in question. Whether a cost is avoidable depends in
part on the duration of the alleged predation as, in general, more costs become
avoidable over time. Where the firm’s pricing of the product(s) does not cover its
own average avoidable costs, the Bureau will consider the pricing to be predatory
in the absence of evidence that the overriding purpose of the conduct was in fur-
therance of a credible efficiency or pro-competitive rationale. For example, it may
be reasonable for a firm to sell excess, obsolete or perishable products at below-
cost prices. Similarly, companies may use below-cost promotional pricing to in-
duce customers to try a new product.
61. There are difficulties inherent in applying a price-cost test to identify predatory
pricing, all other things being equal. The Bureau generally uses various “screens”
prior to conducting an avoidable cost analysis. Specifically, the Bureau will ex-
39 The Bureau will typically consider the question of whether a firm can recoup any losses
incurred in predation in the analysis of whether the conduct has given rise to a substantial
lessening or prevention of competition pursuant to paragraph 79(1)(c). In many cases the
ability to recoup losses from predation will depend on barriers to entry that prevent new
entry in response to supra-competitive prices, or re-entry by predated firms. In the absence of
recoupment in the past, present, or likely recoupment in the future, the Bureau would not
typically consider paragraph 79(1)(c) to be satisfied.
40 Air Canada at paras 76, 80.
838
amine whether the alleged predatory price can be matched by competitors without
incurring losses (suggesting that discipline or exclusion, and subsequent recoup-
ment, is unlikely to occur), as well as whether the alleged predatory price is in fact
merely meeting competition by reacting to match a competitor’s price.
ii. — Exclusionary Conduct

62. In general, the Bureau is not concerned with conduct that forces competitors to
be more effective, but rather with conduct that makes it more difficult for competi-
tors to be effective. Vigorous competition on the merits (e.g., offering superior ser-
vices at a lower price) may force competitors to be more effective or result in their
exit from a market, but does not engage the abuse of dominance provisions. In
contrast, exclusionary conduct is designed to make current and/or potential rivals
less effective, to prevent them from entering the market, or to eliminate them from
the market entirely. Such conduct often does so by raising rivals’ costs or reducing
rival’s revenues.
63. In a non-exhaustive list, section 78 describes various means by which a firm
may engage in exclusionary conduct. These include: margin squeezing of a down-
stream competitor by a vertically-integrated supplier; vertical acquisitions; pre-
empting scarce facilities or resources; adopting incompatible product specifica-
tions; and exclusive dealing. Other exclusionary strategies can include tying and
bundling, and conduct that increases customer switching costs. All such activities
Guidelines
can, in certain circumstances, serve to increase a rival’s costs and/or reduce their
revenues, which may make it more difficult for the rival to compete or result in its
exclusion from the market.
64. The following is a brief discussion of three types of exclusionary conduct that
may raise issues under the abuse of dominance provisions: exclusive dealing, tying
and bundling, and refusals to supply. These are not the only categories of exclu-
sionary conduct, nor are they mutually exclusive. Indeed, in the Bureau’s experi-
ence, individual anti-competitive acts may be viewed as part of more than one cate-
gory, or otherwise blur the lines between them. For instance, the implementation of
a tie can have the effect of inducing a firm’s customers to exclusively purchase a
tied product from that firm.
Exclusive Dealing
65. Exclusive dealing occurs when a firm supplies its product or products to a cus-
tomer on the condition that the customer or supplier buy and/or sell only those
versions of the product(s). In addition or alternatively, exclusive dealing may also
occur when a firm requires that customers (or suppliers) do not buy (and/or sell)
products of competitors. Exclusive dealing can also take the form of a firm requir-
ing or inducing its own suppliers to deal only with the firm itself and not with that
firm’s competitors. Exclusivity may be mandated explicitly, or induced through
other methods, such as technological incompatibilities, requirements contracts,
meet-or-release clauses, most-favoured-nation (MFN) clauses or other contractual
practices.
839
66. Exclusive dealing is not necessarily anti-competitive, and is often engaged in

for reasons other than to exclude competitors. For example, exclusive dealing may
solve “free rider” problems where a firm supplying a product to a downstream re-
tailer also provides some service component, technological information, or
aftermarket support that improves the product for consumers. If the retailer can use
this information to improve the products of rival suppliers as well, the firm, without
contractual protection, will have little incentive to provide this support. In such a
case, exclusive dealing may preserve such an incentive to offer these services,
which is generally to the benefit of consumers.
67. However, by inducing exclusivity from a sufficient quantity of suppliers or cus-
tomers, a dominant firm may raise barriers to entry or expansion by raising rivals
costs. Examples of how this may be achieved include denying rivals sufficient busi-
ness to achieve economies of scale, preventing rivals from accessing necessary in-
puts, forcing rivals to compensate customers for the penalties incurred for switch-
ing, or inducing rivals to inefficiently vertically integrate.
Tying and Bundling

68. Tying occurs when, as a condition of obtaining or using one product (the “ty-
ing” product), a firm requires or induces a customer to purchase another product as
well (the “tied” product). Closely related, bundling typically refers to situations
whereby products are sold together in fixed proportions. Tying and bundling are
ubiquitous in many industries, as many items for sale can be viewed as distinct tied
products or a bundle of different components. In many cases there are often strong
cost efficiencies that motivate tying and bundling.
69. However, to the extent a tying or bundling strategy excludes, predates, or disci-
plines a competitor it may raise concerns under the abuse of dominance provisions
of the Act. In particular, the Bureau will consider whether the tie excludes competi-
tors in whole or in part by increasing their costs or reducing their revenue. For
instance, a tie may result in a firm with a substantial degree of market power in one
market creating, enhancing or maintaining its market power in a second market.
Like exclusive dealing, tying may increase switching costs for consumers, deny
rivals economies of scale or scope necessary for efficient production, or induce
inefficient production choices by rivals.
70. Before concluding that a firm is engaging in tying, the Bureau will seek to
determine whether the alleged tying and tied products are in fact separate products.
A central question in the inquiry is the extent to which separate customer demand
exists for the tying and tied products. The Bureau may also consider efficiencies
that arise from a tie; if, for example, implementing a tie gives rise to efficiencies
such that it is not commercially viable to offer the products separately, the Bureau
would not conclude the tying and tied products to be separate products notwith-
standing consumer demand.
Refusals to Supply
840
71. As a general matter, there is no obligation on any business to supply to, or buy
a product from, another business. However, in some exceptional circumstances, re-
fusals to supply may engage the abuse of dominance provisions.
72. In some cases, a firm may explicitly refuse to supply a product. However, con-
cerns may also arise in relation to “constructive” refusals, where a firm agrees to
supply on terms that are sufficiently onerous as to have the same effect as an ex-
plicit denial (e.g., charging a prohibitively high price).
73. For the Bureau to conclude that a refusal to supply is an anti-competitive act, it
must be the case that the product or service being denied is both competitively
significant and cannot otherwise be feasibly obtained (for example, from other sup-
pliers or through self-supply). Where this is the case, the Bureau may conclude that
it was reasonably foreseeable that the purpose of a refusal was to exclude a compet-
itor, in the absence of a legitimate business justification.
74. When exercising its enforcement discretion in relation to refusals to supply, the
Bureau is aware that competitively significant inputs are often the result of signifi-
cant and costly investment and innovation, and forcing firms to supply may under-
mine incentives for firms to develop new and beneficial products and services.
iii. — Disciplinary Conduct

75. The Bureau considers that a dominant firm engages in disciplinary conduct
Guidelines
where it undertakes actions intended to dissuade an actual or potential competitor
from competing more vigorously, or otherwise disrupting the status quo in a mar-
ket. Such conduct may not have a predatory or exclusionary purpose, but rather, be
intended to soften competition. Section 78 provides two examples of potentially
disciplinary conduct: paragraph 78(1)(d) contemplates the use of fighting brands to
discipline a competitor, and paragraph 78(1)(i) refers to discipline through selling
articles at a price lower than their acquisition cost.
76. Disciplinary conduct may play a role in facilitating, maintaining, or inducing
coordination among firms. In many cases when firms engage in coordinated con-
duct, each participant faces an incentive to deviate from the coordinated outcome.
For example, where firms coordinate in order to raise prices in a market, each par-
ticipant in the coordination may have the incentive to lower its own prices in order
to win additional sales from the other participants at the elevated prices. As a result,
one of the requirements for coordinated behaviour to likely be sustainable is the
ability to respond to any deviations from the terms of coordination through credible
deterrent mechanisms. Disciplinary conduct may provide such a mechanism: by
engaging in disciplinary conduct, a dominant firm can induce or preserve coordina-
tion by punishing — or credibly threatening to punish — deviations from a coordi-
nated outcome.
77. Disciplinary conduct may also include actions that do not directly punish rivals,
but rather, facilitate punishments or increase the credibility of threats to punish ri-
vals. For example, if a firm adopts contractual terms with its customers that provide
the firm with more information about the extent to which rivals are deviating from
841
supra-competitive pricing, thereby increasing the likelihood discipline will occur,

the Bureau may consider the contractual terms to be disciplinary conduct.
78. In assessing whether the purpose of a practice is disciplinary, the Bureau may
be more likely to rely on subjective evidence of intent than when assessing other
types of anti-competitive acts, particularly where the alleged disciplinary conduct
consists of pricing behaviour alone. Because such disciplinary acts may be particu-
larly difficult to distinguish from vigorous competition on the merits, the Bureau
may be hesitant to conclude that an act has a disciplinary purpose based solely on
its reasonably foreseeable consequences.41 When evaluating evidence of subjective
intent, the Bureau will typically look for evidence of “something more” than the
typical intent of a firm to best its competition. For example, where evidence indi-
cates that a firm engaged in an aggressive competitive response not to meet (or
beat) competition from a rival, but instead to induce that rival to compete less vig-
orously, the Bureau may conclude that “something more” is present.
79. Given the above, the Bureau anticipates that it would investigate allegedly dis-
ciplinary conduct in limited circumstances, and that it would generally have to be
satisfied that the alleged conduct is disciplinary on its face.42
iv. — Business Justifications

80. An additional factor in the determination of whether an act is anti-competitive
is whether it was in furtherance of a legitimate business objective. A business justi-
fication is not a defence to an allegation that a firm has engaged in anti-competitive
conduct, but rather, an alternative explanation for the overriding purpose of that
conduct. Proof of the existence of some legitimate business purpose underlying the
conduct is not sufficient. Rather, the Federal Court of Appeal has said that “a busi-
ness justification must be a credible efficiency or pro-competitive rationale for the
conduct in question, attributable to the respondent, which relates to and
counterbalances the anti-competitive effects and/or subjective intent of the acts.”43
Depending on the circumstances, this could include, for example, reducing the
firm’s costs of production or operation, or improvements in technology or produc-
tion processes that result in innovative new products or improvements in product
41 Exceptions to this approach may exist. For example, if a firm engaged in similar beha-
viour after being sanctioned for disciplinary conduct, or if the Bureau observed substantially
similar conduct in a market in which disciplinary conduct had previously taken place, the
Bureau may put less of a focus on subjective evidence of intent.
42 The Bureau recognizes that difficulties may arise identifying an appropriate remedy for
disciplinary anti-competitive acts. As with other conduct actionable under section 79, the
appropriate remedy for a disciplinary act will ultimately depend on the specific facts of any
given case. When determining the appropriate remedy for disciplinary conduct the Bureau
will have regard to the spectrum of options afforded by section 79, including administrative
monetary penalties where appropriate.
842
quality or service.44 Compliance with a statutory or regulatory requirement may

also constitute a business justification, where an act is required to comply with that
statutory or regulatory requirement.45
81. Although the Bureau will consider any business justifications posited by the
allegedly dominant firm, as the courts have recognized, where an allegedly domi-
nant firm asserts a business justification it ultimately bears the burden of proof to
establish it.46
82. In assessing the overriding purpose of an alleged anti-competitive act, the Bu-
reau will examine the credibility of any efficiency or pro-competitive claims raised
by the allegedly dominant firm, their link to the alleged anti-competitive act, and
the likelihood of these claims being achieved. In this assessment, the Bureau may
seek evidence as to the role the asserted efficiency or pro-competitive justification
played in the allegedly dominant firm’s decision-making. In the absence of contem-
poraneous evidence that the asserted business justification rationally motivated the
allegedly dominant firm, the Bureau will be less likely to conclude that the business
justification is credible.
83. Additionally, after finding evidence in support of both an anti-competitive pur-
pose and a claimed business justification, when assessing the overall character of a
practice the Bureau may consider whether the claimed efficiency or pro-competi-
tive benefits could have been achieved by credible alternate means that would have
had a lesser impact on competitors, where appropriate. In conducting this analysis
Guidelines
the Bureau would typically only consider alternative methods to achieve a business
objective where either subjective evidence establishes the allegedly dominant firm
considered those alternatives or there is clear objective evidence that it would be
unreasonable for that firm to not have considered those alternatives (e.g., if a firm
changes the manner in which it pursues a business objective, the Bureau would
generally presume the firm considered maintaining its previous course of action).
84. Consistent with an approach noted by the Tribunal, when assessing the overall
character of a practice the Bureau may consider if the alleged anti-competitive acts
made no economic sense but for their anti-competitive effect on a competitor.47
Conduct that makes no reasonably foreseeable economic sense but for an anti-com-
petitive effect is likely to have an overarching anti-competitive purpose. However,
circumstances may arise where the Bureau finds a practice satisfies paragraph
44 However, as the Tribunal has recognized, it is necessary to consider all known circum-
stances; for example, cost reductions that may be contemplated or realized by driving one’s
rivals from a market would not suffice to shield conduct that was primarily motivated by a
predatory, exclusionary or disciplinary purpose (see TREB CT at para 295).
47 TREB CT at paras 311–318. In addition, the Tribunal indicated that it may also have
regard to whether the acts involved the sacrifice of short-term profits that would not be
recouped but for the exclusion of a competitor. The Bureau’s approach to such analysis is
similar to what is set out above with respect to the no economic sense analysis.
843
79(1)(b) even when, evaluating its reasonably foreseeable consequences, it may

make economic sense without an anti-competitive effect on a competitor. Such
cases may include where evidence of subjective intent establishes an anti-competi-
tive purpose, or where the reasonably foreseeable economic benefits resulting from
exclusion are sufficiently large compared to the other profits derived from the prac-
tice to make it clear that the overarching purpose was an anti-competitive effect on
a competitor.48
85. Business justifications are relevant to the assessment of anti-competitive pur-
pose and do not directly bear on the analysis of competitive effects pursuant to
paragraph 79(1)(c).49 The Bureau is not required to quantify any efficiencies result-
ing from a practice of anti-competitive acts, but will consider any such efficiencies
within the purpose-focussed assessment of paragraph 79(1)(b).50
3. — Competitive Effects
86. Paragraph 79(1)(c) requires that the conduct in question “has had, is having or
is likely to have the effect of preventing or lessening competition substantially in a
market”. In other words, having determined that the firm is dominant and has en-
gaged in a practice of anti-competitive acts, it remains necessary to determine
whether this practice has resulted or is likely to result in substantial harm to compe-
tition in one or more markets.51 Generally speaking, a substantial lessening or pre-
vention of competition occurs when an impugned practice causes a materially
greater degree of market power to exist than in the absence of the practice.
87. Demonstrating a substantial lessening or prevention of competition does not
entail an assessment of whether the absolute level of competition in a market is
48 When analyzing whether conduct made no reasonably foreseeable economic sense but for
the exclusion of a competitor, the Bureau will not always consider the appropriate
counterfactual scenario (against which to assess relative economic benefits) to be the one in
which the firm took no action whatsoever. For instance, where a firm is presented with two
options and elects to pursue the one in which it foresees deriving greater profits due to exclu-
sion (and lower profits from other sources) than the alternative, the Bureau would consider
this to make no economic sense but for the exclusion of a competitor.
50 The Tribunal has recognized that business justifications “do not give rise to the quantita-
tive assessment contemplated by the efficiency exception in section 96 of the Act” and that
“it would be much more difficult, and perhaps even completely intractable, in the section 79
context” (TREB CT at para 291).
51 When assessing competitive effects pursuant to paragraph 79(1)(c) the Bureau analyzes
effects in reference to a market, which in turn engages the concepts of market definition. The
Bureau is of the view that the markets for the purposes of paragraphs 79(1)(a) and 79(1)(c)
need not be the same; that is, section 79 may apply where a firm is dominant in one market
but substantially lessens or prevents competition in another (see, for instance, Tele-direct at
214). When necessary, the Bureau applies the same approach to market definition for the
purposes of paragraph 79(1)(c) as it does in reference to paragraph 79(1)(a), discussed
above.
844
substantial or sufficient, but is instead a relative assessment of the level of competi-

tiveness in the presence and absence of the impugned practice. In carrying out this
assessment, the Bureau’s general approach is to ask whether, but for the practice in
question, there would likely be substantially greater competition in the market in
the past, present, or future.52
88. To satisfy paragraph 79(1)(c), conduct can either lessen or prevent competi-
tion. The Tribunal has recognized that the general analytical approach is similar in
either case, but important differences exist. Conduct that lessens competition typi-
cally permits the exercise of new or increased market power through lessening the
constraint posed by current or potential competitors. Conduct that prevents compe-
tition, in contrast, typically preserves existing market power by preventing new
competition that would have materialized in the absence of the impugned
practice.53
89. In many cases, a substantial lessening or prevention of competition is accomp-
lished by erecting or strengthening barriers to entry or expansion. Through in-
creased barriers to entry or expansion, competitors or potential competitors are in-
hibited or deterred from competing as vigorously as they otherwise would, thereby
disciplining the exercise of market power.54 In examining anti-competitive acts and
their effects on barriers to entry or expansion, the Bureau focuses its analysis on
determining the state of competition in the market in the absence of these acts. If,
for example, it can be demonstrated that, but for the anti-competitive acts, an effec-
Guidelines
tive competitor or group of competitors would likely emerge within a reasonable
period of time to challenge the exercise of market power, the Bureau will conclude
that the acts in question result in a substantial lessening or prevention of
competition.55
90. Although the Bureau’s conceptual approach focusses on increased barriers to
entry or expansion, the Bureau may also assess the effects of a practice of anti-
competitive acts on various indicators of the intensity of competition. Such indica-
tors include whether, in the absence of the practice of anti-competitive acts, the
extent to which:
• monetary prices would be lower;
• product quality, service, innovation, or choice would be greater; or
52 This test was accepted by the Federal Court of Appeal in Canada Pipe FCA 1 at para 38.
The Court stated that other tests might also be appropriate depending on the circumstances.
54 This could include causing rivals to adopt more accommodating competitive reactions.
55 When assessing a reasonable time period for potential competitors to provide effective
competition in the absence of the anti-competitive acts, the Bureau will assess the time re-
quired for competitors to develop products and marketing plans, to build facilities or make
adjustments to existing facilities, and to achieve a level of sales sufficient to prevent or disci-
pline a material price increase by dominant firms. The Federal Court of Appeal has held that
a duration of two years will usually be sufficient to establish an effect (TREB FCA 2 at para
64).
845
• switching between products or suppliers would be more frequent.

91. Whether any lessening or prevention of competition is substantial is assessed in
terms of its degree, duration, and the extent to which it extends throughout the
market. There is no definitive threshold past which a given lessening or prevention
qualifies as substantial. Rather, substantiality is assessed based on market specific
factors, including the market power of the allegedly dominant firm. As the Tribunal
has confirmed, “where a firm with a high degree of market power is found to have
engaged in anti-competitive conduct, smaller impacts on competition resulting
from that conduct will meet the test of being “substantial” than where the market
situation was less uncompetitive to begin with.”56
92. When assessing whether a practice of anti-competitive acts gives rise to a sub-
stantial lessening or prevention of competition, the Bureau may rely on either quali-
tative (e.g., business documents, views of industry participants, etc.) or quantitative
evidence (e.g., econometric studies).57 The Bureau seeks to evaluate the causal im-
pact of the practice of anti-competitive acts by comparing the state of competition
in the market to a counterfactual scenario where the practice did not take place. In
conducting this assessment, the Bureau may seek evidence that directly speaks to
the counter-factual scenario (e.g., the views of market participants), as well as evi-
dence from natural experiments in the market at issue or in other markets.
93. Natural experiments are often useful to assess a counterfactual by examining
historical events that link changes in competitive conditions (e.g., entry or exit of
firms, presence of certain competitors, products, services, or contractual practices)
to changes in observable effects. In appropriate circumstances, the study of events
and their impact on competition in one market can be very informative to an assess-
ment of likely effects in another market. For example, the Bureau may seek evi-
dence on how competitive outcomes differ in similar markets where the impugned
conduct did not take place, or examine evidence relating to the state of competition
in the market before and after a practice of anti-competitive acts (or other events,
such as the exit of a competitor) to determine its causal effect.
94. When assessing the impact of a practice of anti-competitive acts, the Bureau
may consider effects on both static competition (e.g., the impact on prices and out-
put) and dynamic competition (e.g., rivalry driven by product or process innova-
tion). Indeed, conduct that creates or enhances barriers that reduce dynamic compe-
tition, such as innovation, which the Tribunal has characterized as “the most
important form of competition”,58 is of particular concern to the Bureau. However,
due to its forward-looking and uncertain nature, effects on dynamic competition are
often more challenging to assess than effects on static competition. In such cases,
56 Tele-Direct at 247.
57 Although in certain circumstances the Bureau may undertake quantitative studies of com-
petitive effects when assessing potential abuses of dominance, it is not necessary for the
Bureau to adduce quantitative evidence to establish a substantial prevention or lessening of
competition (TREB FCA 2 at paras 101, 104).
846
natural experiments from other markets (where available) may assist in establishing
competitive effects.
95. The potential for enforcement action to chill dynamic competition in favour of
increased static competition is an important consideration for the Bureau in deter-
mining whether to pursue an enforcement action, or even what remedy to pursue if
enforcement action is warranted. Healthy dynamic competition may result in se-
quential “winner take all” competition for a market based on product quality or
innovation, with the result that the successful firm acquires market power. Often, it
is the prospect of market power that provides the incentive for firms to engage in
dynamic competition. Focussing enforcement on static outcomes may result in
longer term harm as it may undermine the incentives for firms to engage in benefi-
cial dynamic competition, and caution must be exercised when intervening in fast-
moving markets. However, this potential result does not give dominant firms a li-
cense to lessen or prevent competition. In particular, where a dominant firm raises
barriers that prevent more (or potentially more) innovative rivals from challenging
its position, the Bureau will not hesitate to take action where appropriate.
4. — Remedies
96. The Bureau considers potential remedies early in any investigation or inquiry
under section 79 in order to determine the nature, scope, and the means by which a
remedy may be implemented. Where the Bureau is satisfied that the evidence sup-
Guidelines
ports a conclusion that section 79 is engaged, a number of avenues to remedy the
situation are available.
A. — Consensual Resolutions
97. Generally speaking, in using the range of enforcement tools available, the Bu-
reau encourages and facilitates voluntary compliance and will often attempt to
achieve a negotiated settlement in response to a breach of section 79.59
98. Where the Bureau has concluded section 79 is engaged, in most circumstances
the Bureau will require that any proposed remedy agreed upon be formalized in a
consent agreement and registered with the Tribunal pursuant to section 105 of the
Act.60 Consent agreements entered into by the Bureau and a respondent must be
based on terms that could be the subject of an order of the Tribunal. Upon registra-
tion, consent agreements have the same force and effect as orders of the Tribunal.
59 See also the Bureau’s Competition and Compliance Framework.

60 Where the Commissioner has concluded the elements of section 79 are satisfied, the Com-
missioner will not typically discontinue an inquiry or application if the dominant firm unilat-
erally ceases its practice of anti-competitive acts unless the dominant firm enters into a con-
sent agreement. This provides certainty and predictability to the Bureau and market
participants that the anti-competitive conduct will not be resumed. In some cases the Bureau
may seek compensation for investigative costs as part of a consent agreement. Additionally,
the Bureau may seek administrative monetary penalties in consent agreements, where
appropriate.
847
B. — Orders of the Competition Tribunal

99. Where the Bureau is satisfied that the evidence supports an application to the
Tribunal under section 79 and the Bureau cannot resolve a case on a consensual
basis, or where a consensual remedy is not considered appropriate in the circum-
stances, the Bureau may make an application to the Tribunal for a remedial order.61
100. Where the Tribunal finds that the elements of section 79 are met, the Act
grants the Tribunal broad discretionary remedial powers to address the anti-com-
petitive conduct in question. This includes the ability to impose both behavioral and
structural remedies, varying from prohibition orders (subsection 79(1)), prescrip-
tive orders requiring that certain corrective action be taken (subsection 79(2)) and
the imposition of administrative monetary penalties (subsection 79(3.1)).
i. — Prohibition and Prescriptive Orders

101. Pursuant to subsection 79(1), the Tribunal may issue an order prohibiting a
respondent from engaging in the impugned practice of anti-competitive acts. In ad-
dition or alternatively, if the Tribunal finds that an order prohibiting the practice is
not likely to restore competition in the affected market, subsection 79(2) provides
that the Tribunal may issue an order directing the respondent to take any such ac-
tions as are reasonable and necessary to overcome the effects of the practice of anti-
competitive acts, including the divestiture of assets or shares.62 Other actions may
include, for instance, changes to contractual terms, or the establishment of a corpo-
rate compliance program. The Bureau typically views prohibition and prescriptive
orders as complementary and, where appropriate, may seek orders that both pro-
hibit the anti-competitive conduct and direct the respondent to take positive steps or
actions as are necessary to restore competition in the market.
102. Failure to comply with an order rendered under section 79 (other than subsec-
tion 79(3.1)) or a consent agreement registered with the Tribunal under section 105
is a criminal offence.63
61 The Commissioner is the only party that may make applications to the Tribunal under
section 79. See subsection 79(1) of the Act.
62 Subsection 79(2) permits the Tribunal to grant both prescriptive behavioural remedies
(e.g., compelling a respondent to undertake certain mandatory conduct) and structural reme-
dies (e.g., the divestiture of assets). The Bureau does not seek structural remedies to abuses
of dominance in the vast majority of circumstances, but may consider doing so where an
abuse of dominance causes structural changes in a market such that competition cannot be
restored by a behavioural remedy alone. For example, where a practice has removed effec-
tive pre-existing competitors from a market where barriers to entry (that are not created or
enhanced by the abuse of dominance) have increased over time with the result that new entry
is not feasible, the Bureau may seek a divestiture that would permit a new entrant to be a
viable competitor. This could either be in lieu of or in addition to a prohibition order under
subsection 79(1) and/or a prescriptive behavioural remedy under subsection 79(2).
63 See section 66 of the Act.
848
ii. — Administrative Monetary Penalties

103. Where the Tribunal issues an order pursuant to subsections 79(1) and/or 79(2)
of the Act, it may also, pursuant to subsection 79(3.1), order the respondent to pay
an administrative monetary penalty (“AMP”). Such a penalty may not exceed $10
million for the first order, or $15 million for each subsequent order. The purpose of
an AMP in an abuse of dominance case is to promote practices by the person from
whom an AMP is sought that are in conformity with the purposes of section 79, not
to punish the respondent for the anti-competitive conduct.64 Failure to pay an AMP
by a respondent may be enforced civilly as a debt due to the Crown.65
104. The Bureau generally considers AMPs as a complement to other remedies
available under section 79 that are designed to restore competition. Given their pur-
pose to promote practices by the dominant firm that are in conformity with the
purposes of section 79 the Bureau’s decision to seek AMPs and their amounts will
depend to a great extent on the facts specific to each case.
105. When assessing whether an AMP is appropriate, the Bureau will consider fac-
tors such as:
i. the respondent’s willingness to collaborate in a timely manner with the Bu-
reau in the context of the investigation or inquiry, including to immediately
cease the impugned conduct when the Bureau raises competition concerns;
ii. the respondent’s history of compliance with the Act; and
Guidelines
iii. whether the evidence suggests the respondent intended not to comply with
the Act, or showed a wanton or reckless disregard for the Act.
106. When the Bureau determines that an AMP is warranted in the circumstances,
the determination of its amount will be guided by the aggravating and mitigating
factors set out in subsection 79(3.2) of the Act:
• The effect on competition in the market;
• The gross revenue from sales affected by the practice;
• Any actual or anticipated profits affected by the practice;
• The financial position of the person against whom the order is made;
• The history of compliance with the Act by the person against whom the order
is being made; and
• Any other relevant factor.
107. The amount of an AMP is to be determined based on the totality of the rele-
vant considerations in the circumstances; no single factor is determinative.
108. In cases where an AMP is sought, the Bureau will be mindful to seek AMPs of
the quantum necessary to ensure that AMPs do not merely become the “cost of
doing business” for a dominant firm engaging in anti-competitive conduct, within
the statutory limits, while also ensuring that they are not excessive or dispropor-
64 See subsection 79(3.3) of the Act.

65 See section 79.1 of the Act.
849
tionate in the circumstances and serve their statutory purpose, i.e., to promote con-
duct that is in compliance with the purposes of the abuse of dominance provisions.
109. The Bureau is guided by similar considerations and factors when determining
whether to include an AMP in consent agreements in respect of abuse of domi-
nance and in establishing the amount.
5. — Illustrative Examples
110. The following examples are designed to illustrate the analytical framework
that may be applied by the Bureau in the enforcement of section 79. These exam-
ples are not intended to provide an exhaustive catalogue of all conduct that may
raise issues under section 79, and depending on the facts of any individual case the
Bureau may depart from the analytical approach set out below. As with these
Guidelines generally, the Bureau’s discussion of the examples below does not re-
place the advice of legal counsel and is not intended to restate the law or to consti-
tute a binding statement of how the Commissioner will exercise discretion in a
particular situation. The enforcement decisions of the Commissioner and the ulti-
mate resolution of issues will depend on the particular circumstances of the matter
in question.
Example 1 — Mere Exercise of Market Power

111. HO3 and SANTA are firms that compete in respect of the supply of Santa hats
in Canada. These two firms are the most important players in the market with mar-
ket shares of 65 percent and 20 percent for HO3 and SANTA respectively. High
barriers to entry make it difficult for a new entrant to enter the market. Recently,
HO3 unilaterally raised the prices for the Santa hats it sells in Canada by over 250
percent. The Bureau has received complaints that HO3 has abused its dominant
position.
Analysis
112. Although it is necessary for a firm to possess a substantial degree of market
power in order to contravene section 79, this alone is not sufficient to raise issues
under the abuse of dominance provisions of the Act. Even where a firm may be
dominant, it must also be engaging in a practice of anti-competitive acts that gives
rise to a substantial lessening or prevention of competition. The Bureau would not
view HO3’s price increase as an anti-competitive act as it does not exclude, pre-
date, or discipline a competitor or a potential competitor. Further, because the price
increase is a result of HO3’s pre-existing market power, not a practice of anti-com-
petitive acts, paragraph 79(1)(c) cannot be established.
Example 2 — Market Definition

113. DUTY is one of several manufacturers of heavy-duty drills in western Canada.
During the last year, SMASH, a manufacturer with a great reputation in the market
for high-end hammers, started marketing “hyper-duty” drills to retailers in western
Canada. These “hyper-duty” drills are 20 percent more expensive than the ones
850
offered by DUTY, but they are also 30 percent more powerful. SMASH, DUTY,
and all other drill manufacturers in western Canada only sell their products through
unaffiliated retail channels.
114. Different drill manufacturers operate in eastern Canada, and shipments of
drills between the two regions are limited, accounting for approximately 5 percent
of drills purchased in western Canada. The share of eastern Canadian produced
drills purchased in western Canada has remained relatively stable despite price
fluctuations between the two regions. However, within western Canada, prices gen-
erally follow each other across the region and shipments of drills are observed in
response to price differentials.
115. SMASH has complained to the Bureau, alleging that DUTY has engaged in a
practice of anti-competitive acts relating to certain of DUTY’s contracting prac-
tices. As part of its complaint, SMASH has presented evidence that its costs, and
consequently its prices, have increased as a result of DUTY’s conduct, while the
prices of DUTY and other traditional drills remained stable.
Analysis
116. This example will focus on product and geographic market definition.
117. To initially conceptualize substitutability, the Bureau would generally use the
hypothetical monopolist test. In order to do so, the Bureau may seek data on substi-
Guidelines
tution patterns between different drill types and manufacturers. In addition, the Bu-
reau would seek information on qualitative factors relating to substitutability; as set
out above, these include
i. functional interchangeability,
ii. views, strategies, behaviour and identity of buyers,
iii. trade views, strategies and behaviour (inter-industry competition),
iv. price relationships and relative price levels, and
v. switching costs.
For example, the Bureau would seek to examine if the additional power or higher
cost from the “hyper-duty” drills prevents or limits substitution, or if the hyper-duty
drills are interoperable with existing equipment. Such information may be sought
from sources including contractors, retailers and other drill manufacturers.
118. In this instance, as all drill manufacturers only sell their products through re-
tailers, the Bureau would likely seek to define a market relating to the sale of drills
to retailers, rather than consumers. However, as substitution at the retail level could
be informed by consumer demand, evidence on end-consumer preferences and sub-
stitution patterns may be relevant.
119. When defining markets for the purpose of section 79, it is necessary to assess
substitutability at the price that would have prevailed absent the impugned conduct.
In this case, the Bureau may accord particular weight to evidence of substitutability
from before the period DUTY engaged in the alleged conduct. However, the Bu-
reau would consider the evidence that the increase in price for “hyper-duty” drills
851
was not correlated with an increase in price for traditional drills to be indicative
that they are not in the same market.
120. Similarly, the Bureau would use the hypothetical monopolist test to examine
the bounds of the geographic market, i.e., the extent of retailer switching from drill
manufacturers in one region to manufacturers in another region. Generally, the Bu-
reau would look at whether an area is sufficiently insulated from price pressures
emanating from other areas so that its unique characteristics can result in its prices
differing significantly in any period of time from those in other areas. Due to the
pricing differentials with eastern Canada, different competitors, and limited imports
that do not vary with the price differential, the Bureau would likely conclude that
eastern Canada should not be included in the same geographic market as western
Canada. The fact that drill manufacturers compete across western Canada and that
prices and purchases track each other across the region would support the conclu-
sion that western Canada is the appropriate geographic market.
Example 3 — Market Power

121. SUBSTANTIAL is Canada’s premier supplier of toques. Toques are sold in
specialized boutiques; although toque retailers usually stock several brands of
toque, they do not typically sell unrelated products. SUBSTANTIAL has a market
share of 40 percent. There are six other competitors who evenly account for the
remainder of the market
122. Information gathered by the Bureau suggests that a substantial number of con-
sumers have a strong preference for SUBSTANTIAL’s products, and only shop at
retailers that stock them. Other customers do not share this preference, and are will-
ing to consider other substitutes, but no other brand of toque attracts similar cus-
tomer loyalty. Consumers view SUBSTANTIAL’s products as key to establishing
credibility as a toque boutique, and a retailer that does not carry SUBSTANTIAL
toques will be significantly disadvantaged against its rivals as a result. For these
reasons, SUBSTANTIAL is able to obtain considerably more favourable support
from retail channels, including favourable placement and expenditure on promo-
tional activities.
123. A competitor of SUBSTANTIAL has complained to the Bureau, alleging that
SUBSTANTIAL has engaged in a practice of anti-competitive acts relating to
SUBSTANTIAL’s contractual terms with retailers which have excluded itself and
other competitors. They have provided credible evidence that as a result of SUB-
STANTIAL’s practice, the price SUBSTANTIAL charges for toques has risen by
more than 33 percent.
Analysis
124. The purpose of this hypothetical is to illustrate the Bureau’s approach to as-
sessing market power in the context of abuse of dominance. For the purposes of
this analysis, the Bureau has already determined that the market is toques sold to
retailers in Canada.
852
125. The Bureau will typically begin with an assessment of whether a firm holds a
substantial degree of market power based on structural considerations. This in-
volves determining the market and then assessing market shares and barriers to
entry. In the absence of other evidence, based on these factors alone, the Bureau
will not typically find dominance in cases where the allegedly dominant firm has a
market share of less than 50 percent. However, in some cases, contextual factors
may suggest that market shares may not be representative of the full extent of a
firm’s market power and may prompt further investigation by the Bureau.
126. In this case, evidence of SUBSTANTIAL’s leverage over retail channels and
the competitive impact of SUBSTANTIAL’s actions would likely prompt further
investigation. When assessing the extent to which SUBSTANTIAL has commercial
leverage over its retail channels, one factor the Bureau would consider is whether
SUBSTANTIAL is willing and able to discipline retailers that do not comply with
SUBSTANTIAL’s terms, or if the threat of punishment is sufficient to exert lever-
age over retailers. If SUBSTANTIAL is able to unilaterally demand and receive
considerably more favourable terms than other suppliers or dictate the level of sup-
port other brands of toque receive, the Bureau may consider this an indicator of
market power. A key element of the Bureau’s analysis would be examining the
underlying consumer demand for SUBSTANTIAL’s products, and the amount of
switching that would occur if the prices of SUBSTANTIAL’s products increased
notwithstanding any alleged anti-competitive acts. The Bureau may also consider
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that the evidence that SUBSTANTIAL’s toque prices increased by more than 33
percent as a result of SUBSTANTIAL’s alleged anti-competitive conduct suggests
SUBSTANTIAL has market power.
127. Given these factors, the Bureau may conclude that SUBSTANTIAL substan-
tially or completely controls a market within the meaning of paragraph 79(1)(a),
that is, it possesses a substantial degree of market power, notwithstanding SUB-
STANTIAL’s market share of 40 percent.
Example 4 — Joint Dominance

128. BUDDY, PAL, and CHUM are manufacturers of tandem bicycles, who sell
their products through retailers. All three are roughly the same size, and each has a
market share of approximately 33 percent. These market shares have remained sta-
ble over the past five years. Evidence suggests that BUDDY, PAL, and CHUM do
not materially attempt to solicit the customers of the other, and there is very little
customer switching between the firms.
129. BUDDY, PAL, and CHUM engage in long-term contracts with retailers that
include automatic renewals, significant liquidated damages clauses in the event of
early termination, and meet-or-release clauses that apply for a period subsequent to
a contract being terminated in accordance with its conditions. These contracts both
limit incentives for BUDDY, PAL, and CHUM to compete among each other and
make it more difficult for new entrants to acquire customers.
130. FRIENDLY has unsuccessfully attempted to enter the market for tandem bi-
cycles. Despite offering lower prices, FRIENDLY was unable to secure a sufficient
number of customers due to the contracting practices of BUDDY, PAL, and
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CHUM. Without the ability to realize the economies of scale necessary to compete
with the incumbents, FRIENDLY was forced to abandon its efforts to enter the
market.
Analysis
131. This hypothetical will focus on assessing whether BUDDY, PAL, and CHUM
are jointly dominant, rather than the other elements of section 79. The Bureau has
already established that the product market is tandem bicycles, and the geographic
market is Canada.
132. First, the Bureau would seek to assess whether firms outside the allegedly
dominant group, either existing competitors or potential entrants, can discipline any
exercise of market power by BUDDY, PAL, or CHUM. In this case, as there are no
other firms in the market, the focus of this assessment would be on potential en-
trants. The Bureau would consider the barriers to entry that exist, as well as the
history of failed entry by FRIENDLY. Unless the Bureau found that barriers to
entry were low (including barriers created by the conduct at issue), the Bureau may
conclude that potential entrants could not discipline the joint exercise of market
power by the incumbents.
133. The Bureau would then examine if competition between BUDDY, PAL, and
CHUM is sufficient to prevent a joint exercise of market power to a substantial
degree. Relevant information to this assessment includes factors such as the stabil-
ity of market shares over time, the lack of active solicitation of the others’ clients,
and low customer switching, which would suggest that BUDDY, PAL, and CHUM
jointly possess a substantial degree of market power. That BUDDY, PAL, and
CHUM have adopted similar contractual terms may be relevant to this analysis to
the extent they lessen the vigour of competition among the three, and therefore
facilitate the joint exercise of market power.
134. As a result, the Bureau could conclude BUDDY, PAL, and CHUM are jointly
dominant in the market for tandem bicycles in Canada, satisfying the requirement
of paragraph 79(1)(a).66
Example 5 — Predatory Pricing

135. CHATEAU and DOMAINE are two Canadian maple-infused ice wine pro-
ducers. Both produce only one type of wine, which is unique to these two vine-
yards. Indeed, both are located on a major hill in Gatineau with a particular micro-
climate that cannot be found anywhere else in the world and this gives their prod-
ucts a distinctive taste which is sought after by connoisseurs.
136. Following a change in the leadership of CHATEAU, last year its new manage-
ment substantially increased production and now offers customers a $40 rebate to
66 In addition to the above factors, the Bureau would also consider any other relevant evi-
dence that a substantial degree of market power exists on the part of BUDDY, PAL, or
CHUM, such as direct evidence of market power, or an ability to exclude.
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the regular $50 price on each bottle of this year’s vintage of its classic ice wine.
Following this, DOMAINE contacted the Bureau alleging that this constitutes pred-
atory pricing.
Analysis
137. Allegations of predatory pricing are examined under section 79 of the Act.
Predatory pricing occurs when a firm deliberately prices below its own costs in
order to eliminate or discipline existing rivals or to deter entry. This can substan-
tially lessen or prevent competition when the firm engaging in the predation can
subsequently recoup its losses by charging prices above the level that would other-
wise have prevailed. For the purposes of this example, assume that the wines of
CHATEAU and DOMAINE constitute the product market, the geographic market
is Canada, and that CHATEAU holds a substantial degree of market power within
that market.
138. As a pre-condition for predatory pricing, the Bureau considers it necessary for
the relevant products to be priced below their average avoidable costs. Regarding
this particular fact situation, a relevant initial way to assess the validity of
DOMAINE’s concerns would be to seek information from DOMAINE on its own
costs and profitability. If CHATEAU’s price is above DOMAINE’s own costs, the
Bureau would conclude that DOMAINE is not likely to be excluded by the pricing
strategy and as a result, the requirements of paragraph 79(1)(c) are not likely met.
Guidelines
Further, this would cast doubt on the assertion that CHATEAU is pricing below its
own costs.
139. When assessing CHATEAU’s average avoidable costs, the Bureau’s focus
will be on determining those costs that would have been avoided had CHATEAU
not produced and sold the wine subject to the pricing strategy, including any oppor-
tunity costs. For simplicity, assume that there are four categories of costs that
CHATEAU incurs:
Bottles:
CHATEAU purchases bottles shortly before bottling a given vintage based on
the quantity it needs;
Barrels:
CHATEAU has a fixed stock of aging barrels, which is larger than what it
typically requires at any time and CHATEAU rents excess barrels out to other
vineyards;
Labour:
CHATEAU has a permanent staff who can only be fired in extreme circum-
stances, and hires seasonal labour to assist with grape planting, harvesting,
processing, and bottling; and
Land:
CHATEAU is 68 years into a 100 year lease for the land the vineyard is situ-
ated on, cannot increase or reduce the amount of land it leases, and cannot use
the land for any other purpose.
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140. Because the quantity of bottles CHATEAU purchases varies based on the
amount of wine CHATEAU produces, the Bureau would view this as an avoidable
cost. Conversely, because CHATEAU cannot increase or reduce the amount of land
it leases, the Bureau would not view land as an avoidable cost regardless of what
share of CHATEAU’s total costs the lease represents.
141. Because CHATEAU rents out barrels to other vineyards, when it uses them to
age its own wine CHATEAU incurs an opportunity cost for the foregone rent it
otherwise would have received. As a result, this foregone rent becomes an avoida-
ble cost even if CHATEAU would not have purchased additional barrels.
142. Certain elements of CHATEAU’s labour costs would likely be avoidable,
while others may not be. Any seasonal labour CHATEAU retained for the purposes
of producing the wine subject to the pricing strategy would be avoidable. If CHA-
TEAU would not have hired any additional permanent employees to produce the
wine, and as CHATEAU is limited in its ability to terminate permanent employees,
these costs would not be avoidable, depending on the duration of the pricing strat-
egy. To illustrate, if the pricing occurs for a short period, CHATEAU may not be
able to alter its costs related to permanent employees. However, if it persists for a
longer time such that permanent employees may quit or retire and CHATEAU
would have discretion as to whether to hire replacements, permanent labour costs
may become avoidable.
143. The Bureau would typically also seek to determine if there is credible evi-
dence of a legitimate business objective on the part of CHATEAU — e.g., if they
were meeting a price set by a competitor, selling excess, obsolete or perishable
inventory, or seeking to induce customers to try a new product.
144. Having determined CHATEAU’s avoidable costs, the Bureau would then
compare this to the price of the wine subject to the pricing strategy. In the absence
of a credible business justification, if CHATEAU is pricing below its average
avoidable cost, the Bureau would likely conclude that CHATEAU has engaged in a
practice of anti-competitive acts.
145. In addition, even where a firm is pricing below its average avoidable costs, in
order to substantially lessen or prevent competition and thereby raise issues under
the Act it must be likely for a firm to recoup the losses it incurred through its
pricing strategy. If any attempt to subsequently raise prices would be thwarted by
timely new entry, re-entry, or remaining competitors, the below cost pricing will
not give rise to a substantial lessening or prevention of competition. In such cases,
if the dominant firm successfully raises prices, and barriers prevent new entry, re-
entry or expansion of existing competitors from being sufficiently timely or suffi-
cient to discipline the exercise of market power on the part of the dominant firm,
competition will be substantially prevented or lessened.
146. Barriers to entry may be created or strengthened by the predation. For exam-
ple, by developing a “reputation for predation” a dominant incumbent may create
the perception that entry will be unprofitable, deterring actual or potential entrants.
147. In this case, the Bureau would evaluate if any attempt by CHATEAU to raise
prices and exercise market power would be thwarted by re-entry by DOMAINE, or
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by new entry. In this case, if re-entry by DOMAINE is unlikely or would not disci-
pline CHATEAU’s market power and a new entrant would be unable to obtain the
land, assets, or know-how necessary to produce a competing wine, or would face
significant reputational barriers due to being an unproven entrant that would pre-
vent it from disciplining CHATEAU’s market power, the Bureau may conclude
that recoupment is possible and that the conduct substantially lessens or prevents
competition.
Example 6 — Exclusive Dealing

148. A panopticon is a consumer electronic device that has become ubiquitous
since its introduction three years ago. Most major consumer electronics manufac-
turers started developing their own panopticons and are competing to offer the best
panopticons to consumers with the most advanced features.
149. Panopticons collect a significant volume of data on their users, including loca-
tion and spending habits. Realizing the value of this data, several companies,
known as panopticon data aggregators, started buying panopticon data directly
from the panopticon manufacturers in order to analyze it and monetize the intelli-
gence mined from the data. One of the key uses of aggregated panopticon data is
providing insights into consumer preferences and purchases for advertising and
marketing purposes.
Guidelines
150. In Canada, unlike in the United States where there are three major panopticon
data aggregators, only one firm is offering these services. That firm, named
THOTH, has been collecting panopticon data for the last two years and uses this
data to enhance the capabilities of its algorithm, making its product even more de-
sirable to customers. Having two years of Canadian panopticon data in its al-
gorithm gives THOTH a significant competitive advantage over any entrant in the
market for panopticon data aggregation in Canada. Further, THOTH collects data
on how its customers use THOTH’s aggregated data, which permit it to further
improve the quality of its algorithm.
151. Over the last year, THOTH has started signing new ten-year contracts with all
its suppliers of panopticon data in Canada. These contracts include significant mon-
etary penalties for early termination, as well as bonus payments for providing
THOTH exclusive access to data. THOTH claims that these contractual terms are
necessary in order for it to recoup the significant investments it has made in inte-
grating the data from its suppliers into its algorithm. Further, THOTH claims that
the exclusivity payments incentivize data suppliers to technologically integrate
themselves with THOTH’s platform, increasing the quality of data THOTH collects
and improving the analysis it can provide to customers.
152. ENKI, THOTH’s largest competitor in the United States, has complained to
the Bureau that because of these contractual terms ENKI cannot secure the data it
would require to enter the Canadian market and compete with THOTH.
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Analysis
153. For the purposes of this hypothetical, assume that the Bureau has already de-
fined a product market around panopticon data aggregation in Canada, and that
THOTH is dominant in that market.
154. When assessing if THOTH has engaged in a practice of anti-competitive acts,
the Bureau would likely focus its analysis on the payments for exclusive access to
panopticon data.67 In particular, the Bureau would seek to determine if the purpose
of the payments was to foreclose access to panopticon data in order to exclude
rivals.
155. When assessing the purpose of the contractual terms, the Bureau may examine
evidence relating to the negotiation of the contractual terms. This analysis may con-
sider whether the contractual terms were included at the request of THOTH or the
suppliers. In the latter case, the Bureau may assess THOTH’s intent in agreeing to
the supplier’s request, or any modifications to the supplier’s request that may have
been made at the behest of THOTH.
156. As part of the Bureau’s investigation, in addition to seeking any subjective
evidence of intent on the part of THOTH, the Bureau may seek to determine if
excluding ENKI was a reasonably foreseeable consequence of the contractual
terms. This may include gathering information on the extent to which substitutes
exist for the data suppliers subject to the THOTH contracts, whether additional sup-
pliers could enter or ENKI could self-supply with data, and if the payments for
exclusivity have the effect of inducing some or all data suppliers to not deal with
ENKI. The Bureau would also assess the extent to which ENKI requires data from
all suppliers to be viable in the market. The Bureau may also examine whether,
even without the exclusivity payments, it was reasonably foreseeable that panop-
ticon data suppliers would not have supplied data to ENKI. If the contractual terms
have the effect of preventing a sufficient number of data suppliers from dealing
with ENKI and there are no viable alternatives, the Bureau could conclude that a
negative exclusionary effect on a competitor was reasonably foreseeable.
157. The Bureau may also assess any relevant business justifications for the con-
tractual terms advanced by THOTH. Here, it argues that the exclusivity payments
incentivize beneficial technological integration. If, for example, there was no con-
temporaneous evidence at the time the contractual terms were entered into that the
payments would improve technological integration and thereby product quality, the
Bureau would be unlikely to find THOTH’s justification credible. Even if there is
some evidence of the benefits of the payments, if there was contemporaneous evi-
dence suggesting THOTH considered other options to achieve similar outcomes
through less restrictive means (e.g., contracting for similar services instead of re-
quiring exclusivity) the Bureau may not consider THOTH’s business justification
persuasive.
67 Because the contractual terms have been consistently inserted into ten-year agreements
with data suppliers, the Bureau would consider THOTH to be engaged in a practice.
858
158. The Bureau may also consider whether THOTH’s exclusivity payments made
economic sense but for the exclusion of competitors. This would involve trading
off the costs of the exclusivity payments against any revenues that would be de-
rived from benefits other than exclusion (e.g., increased sales of aggregated panop-
ticon data due to higher quality, if any). In the absence of demonstrated revenues
that do not depend on exclusion, the Bureau could consider this an indicator that
the exclusivity payments have an anti-competitive purpose.
159. The Bureau would then consider whether the contractual terms substantially
lessened or prevented competition in the market for panopticon data aggregation,
i.e., if the contractual terms permit THOTH to exercise materially greater market
power in the past present or likely in the future.
160. In this circumstance, the Bureau would seek to determine the extent to which
barriers to entry are the result of THOTH’s contractual terms, as compared to char-
acteristics of the market itself. For instance, in an industry characterized by net-
work effects, the extent to which barriers to entry already exist must be taken into
account when assessing the effect of the clauses on competition. Here, THOTH’s
superior algorithm resulting from two years of panopticon data aggregation and
customer use data may create sufficiently strong barriers that the contractual terms
have no incremental effect.
161. The Bureau would seek to determine if, in the absence of THOTH’s contrac-
tual terms, entry would be timely, likely, and sufficient to discipline the market
Guidelines
power of THOTH. In order to assess the effects of the contractual terms, the Bu-
reau may seek information on the state of competition in the United States where
there are no exclusivity clauses, and the views of other potential entrants. If evi-
dence indicated that entry would be unlikely because of the market structure even
in the absence of such clauses, it would make the Bureau significantly less likely to
conclude that there has been, is, or is likely to be a prevention of competition re-
sulting from the clauses.
162. If the contractual terms are having the incremental effect of deterring entry,
the Bureau would seek to assess the competitive significance of that entry. This
may include examining evidence on the relative state of competition in markets for
panopticon data aggregation where no such exclusivity clauses with suppliers exist,
such as the United States. If evidence indicated that prices paid for panopticon data
would be substantially lower, quality of services higher, or that there would be
substantially more innovation in the absence of the contractual terms, the Bureau
could conclude that THOTH’s conduct has substantially prevented competition.
Example 7 — Tied Selling

163. GORDIAN produces hitches, which are used in a variety of industrial applica-
tions. Use of a hitch requires rope, which quickly degrades and often needs to be
replaced.
164. As late as two years ago there were four different producers of rope, including
GORDIAN. At that time a rival producer, ALEXANDER, began developing plans
to introduce a competing product to GORDIAN’s hitches. ALEXANDER planned
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to leverage synergies between hitch and rope production to reduce costs and offer
hitches at a price 20 percent below GORDIAN. Shortly afterward, GORDIAN in-
troduced a policy requiring that only GORDIAN rope may be used with its hitches
in order for the hitch to qualify for warranty coverage. Following this, the vast
majority of hitch users switched to GORDIAN rope. As a result ALEXANDER and
other third party rope manufacturers exited the market, and, as ALEXANDER was
no longer able to rely on production efficiencies between hitches and rope, aban-
doned its efforts to compete with GORDIAN hitches.
165. GORDIAN claims that this policy was implemented because of low quality
third party rope causing damage to its hitches, increasing GORDIAN’s costs to
provide service and lowering the reputation of its products.
Analysis
166. For the purposes of this hypothetical, assume that the Bureau has already de-
fined a product market around hitches, and that GORDIAN is dominant in that
market. Further, subject to hitches and rope being separate products (as discussed
below), assume that the Bureau has defined rope to be a product market. In both
cases, assume that the geographic market is Canada.
167. The Bureau would seek to determine whether the alleged tying and tied prod-
ucts are in fact separate products. A central question in the inquiry is the extent to
which separate customer demand exists for the tying and tied products. The Bureau
may also consider efficiencies that arise from a tie; if, for example, implementing a
tie gives rise to efficiencies such that it is not commercially viable to offer the
products separately the Bureau could not conclude the tying and tied products to be
separate notwithstanding consumer demand.
168. In this case, when evaluating whether separate demand exists, the Bureau may
consider the history of hitches and rope being purchased from different manufactur-
ers, as well as the views of current and potential rope purchasers. Based on these
facts, the Bureau could conclude that separate demand exists.
169. The Bureau could also consider whether implementing the tie gives rise to
efficiencies such that it is not practical to offer hitches and rope as separate prod-
ucts. Because the economies of scope between rope and hitches rely on their joint
production rather than the tie, the economies of scope would not be considered as
part of this analysis. Here, the Bureau could consider the history of the two prod-
ucts being sold separately to be dispositive, and conclude that hitches and rope are
separate products.
170. The Bureau may then turn to assessing whether GORDIAN’s purpose in im-
plementing the tie was anti-competitive; in this case, focussing on whether the tie
was intended to exclude one or more competitors in the market for rope. This
would involve examining evidence of GORDIAN’s subjective intent in implement-
ing the tie, as well as the reasonably foreseeable effects of the tie.
171. The Bureau would typically examine the extent to which the tie is binding,
that is, the extent to which the tie was likely to divert demand in the market for
rope to GORDIAN. For instance, if hitch users can readily turn to effective substi-
860
tutes for GORDIAN’s warranty services at a sufficiently low cost, exclusion from
the change to the warranty policy is not likely to be reasonably foreseeable (and
similarly, if the tie is not binding, it is unlikely to prevent or lessen competition
substantially). The Bureau would also examine the extent to which entry would be
effective both into the market for hitches in the absence of economies of scope
between hitches and rope, as well as the feasibility and effectiveness of entry into
both markets simultaneously.
172. The Bureau would also consider any business justifications posited by GOR-
DIAN. In this case, this may include gathering evidence on the extent to which
third party rope caused hitch breakdowns prior to the tie, whether breakdowns have
decreased following the tie, and if customer satisfaction with hitches has improved.
173. If subjective or objective evidence suggests the tie was instituted with exclu-
sionary intent, and that evidence in support of the business justification was not
compelling, the Bureau could conclude that GORDIAN has engaged in a practice
of anti-competitive acts.
174. The Bureau would then consider whether the tie has, is, or is likely to cause a
substantial lessening or prevention of competition in either the market for hitches
or the market for rope. For example, if the Bureau concluded that the tie had raised
barriers to entry in the market for hitches by denying economies of scope with rope
production, the Bureau could conclude that there has been a substantial prevention
or lessening of competition.
Guidelines
Example 8 — Trade Association Rules
175. SOL is a provincial trade association of solar panel manufacturers. Among
other activities, SOL coordinates industry quality and performance standards for
exclusive use of its members, and certifies compliance with these standards. Pur-
chasers of solar panels have come to recognize and demand the certification SOL
provides, and uncertified solar panels see markedly lower sales. Because of the
significant benefits these standards provide, virtually all solar panel manufacturers
in the province are members of SOL. There are similar trade associations to SOL in
other provinces, who engage in similar activities. SOL is purely a trade association:
it does not produce solar panels, and has not been provided with any powers or
regulatory role by any federal or provincial statute.
176. There are many solar panel manufacturers that are members of SOL, and no
individual member has a market share of more than 5 percent. The past several
years have seen various solar panel manufacturers enter and exit the market.
177. SUNNY is a highly successful solar panel manufacturer outside the province
in which SOL operates. Unlike other solar panel manufacturers who sell homoge-
nous solar panels through traditional retail channels, SUNNY has pursued a busi-
ness model where customers may order personalized solar panels through the in-
ternet, which are then shipped directly. Many consumers consider SUNNY’s solar
panels to be more convenient, of higher quality relative to those of its competitors,
but at a comparable cost. SUNNY has grown rapidly in its native province, and is
considering expanding its operations across the country.
861
178. Around the time SUNNY began rapidly expanding, SOL passed rules prohib-
iting its members from selling customized products directly to consumers. SOL
claims that because customized solar panels are more varied, if they bypass tradi-
tional retail channels (where they can be more readily monitored) they cannot be
subject to the same level of testing and cannot be certified as part of the standard
for panels established by SOL. SUNNY has complained to the Bureau, stating that
it wishes to begin operating in SOL’s province, but is prevented due to the rules of
SOL. SUNNY claims that without certification by SOL, demand for SUNNY’s
products will be markedly reduced and as a result its entry based on its current
business model will not be viable.
Analysis
179. For the purpose of this hypothetical, assume the Bureau has determined the
market to consist of solar panels sold in the province in which SOL operates.
180. Having defined the market, the Bureau would assess whether SOL substan-
tially or completely controls that market. Although the Bureau may seek to under-
stand if substitutes exist for the services of SOL — for example, if alternate certifi-
cations exist that SOL’s members can effectively substitute for SOL’s — the
Bureau may not engage in a separate market definition exercise around the services
of SOL or assess its market power in that second market. However, the existence
and feasibility of substitutes for SOL’s services may be relevant in assessing if
SOL holds a substantial degree of market power in solar panels, the reasonably
foreseeable effects of SOL’s restrictions, and if such restrictions give rise to a sub-
stantial lessening or prevention of competition.
181. When determining whether SOL substantially or completely controls the mar-
ket for solar panels, the Bureau could consider the extent to which SOL can influ-
ence factors such as price, quality, variety, service, advertising or innovation in the
market for solar panels. This would typically include an examination of whether
membership in SOL and access to its certification is commercially necessary to
compete in the market, and the extent to which SOL can enforce its rules on its
members. If, for example, SOL can effectively exclude competitors or types of
competition from the market, the Bureau could consider this requirement satisfied.
In this case, the Bureau may seek to assess the extent to which consumer demand
for a manufacturer’s solar panels depends on SOL’s certification. If consumer de-
mand was sufficiently reduced for uncertified solar panels as to make it infeasible
to compete, the Bureau could conclude SOL has a substantial degree of market
power.
182. The Bureau will then seek to understand if SOL has engaged in a practice of
anti-competitive acts. As SOL does not compete in the market for solar panels, the
Bureau may seek to determine if SOL has a plausible competitive interest in nega-
tively affecting competition in the market for solar panels. As SOL is a trade asso-
ciation that acts in the interests of its members, the Bureau would likely conclude
that it has such a competitive interest.
183. The Bureau would seek to evaluate the purpose of the rules adopted by SOL.
This may include examination of contemporaneous evidence of SOL’s intent, such
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as documents or statements by SOL’s officers, that speak to the intent behind

SOL’s rule changes. The Bureau may also consider whether exclusion of business
models such as SUNNY’s was a reasonably foreseeable consequence of the rules
adopted by SOL. The Bureau would also consider any business justifications put
forward by SOL, evaluate their credibility, and determine whether these business
justifications outweigh any evidence of anti-competitive intent. When evaluating
the justification that individualized products may not conform to the standards set
by SOL, the Bureau may evaluate the experience from areas where comparable
restrictions are not adopted and the extent to which SOL conducted any studies to
support the need for its restrictions. The Bureau may also have regard to whether
the restrictions made economic sense, but for the exclusion of disruptive
competition.
184. The Bureau would then seek to evaluate whether the restrictions give rise to a
substantial lessening or prevention of competition. In doing so, the Bureau would
consider whether there would be substantially greater competition among the mem-
bers of SOL in the absence of the restrictions. Notably, the Bureau would not con-
sider the relatively small market shares of the individual members of SOL or entry
and exit (i.e., the absolute level of competition in the market), as dispositive in this
regard. The Bureau’s concern could be that the rules of SOL exclude or impede
entrants (or potential entrants), as well as innovation among the members of SOL,
leading to reduced dynamic competition. Relevant factors would include if the re-
Guidelines
strictions increased barriers to entry and expansion, whether the restrictions re-
duced the range of solar panels offered or their quality, and whether the restrictions
have reduced innovation. The Bureau may find natural experiments in other mar-
kets persuasive, as well as the projections of businesses regarding the services they
could offer but for the restrictions. The Bureau would also seek to assess whether
other members of SOL would be offering higher quality services, be more innova-
tive, or otherwise be engaging in more vigorous competition in the absence of the
restrictions.
Example 9 — Disciplinary Conduct (1)

185. STATIC is Canada’s largest provider of Secured Lending Cross-swaps
(SLCs), a type of consumer-facing financial product, selling 60 percent of all SLCs
in Canada. STATIC has one competitor, DYNAMIC, who accounts for the remain-
ing 40 percent of sales. Since the entry of STATIC and DYNAMIC, significant tax
incentives for the industry have been terminated and regulatory requirements for
new entrants were increased, making new entry prohibitively difficult.
186. Competitive conditions in the SLC market — market shares, fee levels, and
service offerings — have remained generally stable over the past decade. Docu-
ments gathered by the Bureau suggest that each market participant has historically
realized that they benefit from less vigorous competition between each other, and
have not traditionally attempted to solicit each other’s customers, reduced their
prices, or improved their service offerings.
187. Six months ago, DYNAMIC hired a new CEO who publically stated that DY-
NAMIC would begin a new program of customer acquisition, cutting fees by 10
863
percent and developing a new and more convenient smartphone application for cus-
tomers to monitor and manage their SLCs. Shortly thereafter, STATIC launched a
second branding of SLCs, QUANTIFY, through which STATIC began selling
SLCs at a 70 percent discount to regular fees. After one month, DYNAMIC an-
nounced it would continue with its pricing; STATIC immediately further dropped
the fees of the QUANTIFY brand to 20 percent of historical levels, announcing that
it would continue to offer these fees as long as DYNAMIC continued with its cus-
tomer acquisition program. The following month, DYNAMIC’s CEO stated they
would abandon their customer acquisition program, citing changed competitive
conditions. STATIC withdrew the QUANTIFY brand from the market.
188. Following a complaint to the Bureau and a preliminary investigation, evidence
indicates that STATIC was not pricing below its average avoidable costs at any
point. However, internal correspondence and memos indicated that, through
launching QUANTIFY, STATIC intended to punish DYNAMIC for adopting a
new fee strategy and deter DYNAMIC from continuing its low fees, rather than
simply matching or beating DYNAMIC’s pricing. STATIC has told the Bureau it
was simply a pro-competitive, aggressive response to DYNAMIC’s pricing.
Analysis
189. Assume the Bureau has defined the market as SLCs sold in Canada, and con-
cluded that STATIC holds a substantial degree of market power.
190. When assessing if STATIC’s conduct is an anti-competitive act, the Bureau
may accord particular weight to subjective evidence of intent, in order to distin-
guish a disciplinary act from aggressive competition on the merits. In particular, the
Bureau may look for evidence that, in launching QUANTIFY, STATIC was at-
tempting to punish DYNAMIC for its customer acquisition program, and restore
market conditions to the historical status quo. When evaluating the overarching
purpose of STATIC’s conduct, the Bureau could also consider documentary evi-
dence that other competitive responses on the part of STATIC would have been
profitable had DYNAMIC not abandoned its customer acquisition program.
191. If the Bureau were satisfied that STATIC’s conduct constituted a practice of
anti-competitive acts, the Bureau would seek to determine if it caused a substantial
lessening or prevention of competition. This could involve assessing the fee levels
that would have likely prevailed if STATIC had adopted a different response and
DYNAMIC had persisted in its customer acquisition strategy, as well as any non-
price effects from DYNAMIC abandoning its new smartphone application.
Example 10 — Disciplinary Conduct (2)

192. WILDERNESS is the largest retailer of outdoor equipment in Canada, and
sells products primarily online. Due to advantages such as sophisticated recommen-
dation algorithms driven by consumer data, WILDERNESS enjoys significant cus-
tomer loyalty. WILDERNESS is well known for using algorithms and the auto-
mated collection of data to monitor and respond to market trends.
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193. For the past three years, WILDERNESS has sold over 85 percent of tents
purchased in Canada. There are two producers of tents, YURT and BIVOUAC.
194. FRONTIER is a rival e-commerce retailer that has recently commenced opera-
tions in Canada, and has begun selling tents, produced by both YURT and
BIVOUAC. To date, FRONTIER has made minimal inroads to the Canadian mar-
ket and at present facilitates sales of only 4 percent of tents.
195. Until recently, prices for tents on FRONTIER’s platform have been compara-
ble to those on WILDERNESS’s. In the past few months FRONTIER has begun
competing more aggressively on sales of tents, offering discounts up to 20 percent
below WILDERNESS’s prices. However, when FRONTIER began doing so, both
YURT and BIVOUAC found that orders of their products were being shipped sub-
stantially slower to customers by WILDERNESS, and their products featured nota-
bly less favorable placement on WILDERNESS’s website. Although WILDER-
NESS has not confirmed that this is the direct result of FRONTIER’s pricing
behavior, both YURT and BIVOUAC have taken steps to prevent FRONTIER
from undercutting WILDERNESS on tents. When they did so, previous service
levels and website placement with WILDERNESS resumed.
196. FRONTIER has complained to the Bureau in relation to WILDERNESS’s
conduct.
Guidelines
Analysis
197. For the purposes of this hypothetical, assume that the Bureau has defined a
relevant market that consists of the retail sale of tents in Canada, and that the Bu-
reau has concluded that WILDERNESS has a substantial degree of market power
in that market.
198. Depending on the facts and evidence the Bureau could evaluate WILDER-
NESS’s conduct as either exclusionary or disciplinary, or both. To the extent that
WILDERNESS intended to increase FRONTIER’s costs in order to make FRON-
TIER a less effective competitor in the market for tents, the Bureau may view WIL-
DERNESS as engaging in exclusionary conduct. Alternatively, if, for example,
WILDERNESS intended to deter FRONTIER from competing more vigorously
without affecting its ability to compete, the Bureau may view this as disciplinary
conduct.
199. In either case, to evaluate FRONTIER’s claims, the Bureau may seek evidence
from WILDERNESS with respect to the operation of its monitoring algorithms,
fulfillment services, and decisions with respect to website placement, including the
extent to which sales of YURT and BIVOUAC’s products were indeed contingent
on FRONTIER’s lower pricing.
200. In order to evaluate if WILDERNESS’s conduct gives rise to a substantial
lessening or prevention of competition, the Bureau would seek evidence that but for
the impugned conduct, prices would be lower in the market for tents. This would
likely involve examining the extent to which FRONTIER would lower its prices in
the absence of the impugned conduct. As part of this analysis, the Bureau would
likely analyze the extent to which YURT and BIVOUAC are impacted by WIL-
865
DERNESS’s conduct, the causal impact of WILDERNESS’s conduct on YURT

and BIVOUAC’s decision to prevent FRONTIER from undercutting WILDER-
NESS, as well as the extent to which FRONTIER would capture a significant share
of WILDERNESS’s former consumers if WILDERNESS continued to degrade its
quality of service in relation to tent orders. The Bureau would also assess the dura-
tion of the lessening or prevention of competition; for example, if FRONTIER was
engaging in promotional pricing for a limited period of time with little lasting bene-
fit to FRONTIER’s ability to compete with WILDERNESS, the Bureau would be
less likely to conclude competition is substantially prevented or lessened.
Full citations of judicial decisions

Air Canada:
Commissioner of Competition v Air Canada, 2003 Comp Trib 13
Canada Pipe CT:
Commissioner of Competition v Canada Pipe, 2005 Comp Trib 3
Canada Pipe FCA 1:
Canada (Commissioner of Competition) v Canada Pipe Co, 2006 FCA 233;
leave to appeal refused (10 May 2007).
Canada Pipe FCA 2
Canada (Commissioner of Competition) v Canada Pipe Company Ltd, 2006
FCA 236; leave to appeal refused (10 May 2007).
Direct Energy:
The Commissioner of Competition v Direct Energy Marketing Limited, 2015
Comp Trib 2
Hillsdown:
Canada (Director of Investigation and Research) v Hillsdown Holdings Ltd
(1992), 41 CPR (3d) 289 (Comp Trib)
Laidlaw:
Canada (Director of Investigation and Research) v Laidlaw Waste Systems
Ltd (1992), 40 CPR (3d) 289 (Comp Trib)
NutraSweet:
Canada (Director of Investigation and Research) v NutraSweet Co (1990), 32
CPR (3d) 1 (Comp Trib)
Tele-Direct:
Canada (Director of Investigation and Research) v Tele-Direct (Publications)
Inc. (1997), 73 CPR (3d) 1 (Comp Trib)
Tervita:
Tervita v Canada (Commissioner of Competition), 2015 SCC 3.
866
TREB CT:
The Commissioner of Competition v The Toronto Real Estate Board, 2016
Comp Trib 7
TREB FCA 1:
Commissioner of Competition v Toronto Real Estate Board, 2014 FCA 29;
leave to appeal refused (24 July 2014).
TREB FCA 2:
Toronto Real Estate Board v Commissioner of Competition, 2017 FCA 236;
leave to appeal refused (23 August 2018).
Visa:
The Commissioner of Competition v Visa Canada Corporation and
MasterCard International Incorporated, 2013 Comp Trib 10
Guidelines
867
PRICE MAINTENANCE (SECTION 76 OF THE
COMPETITION ACT) ENFORCEMENT
GUIDELINES*
and innovative marketplace. The Bureau investigates anti-competitive practices and
promotes compliance with the laws under its jurisdiction, namely the Competition
Act (the “Act”),1 the Consumer Packaging and Labelling Act, the Textile Labelling
Act and the Precious Metals Marking Act.
In 2009, important amendments modernized the Act to enhance the predictability,
efficiency and effectiveness of its enforcement and administration and to better pro-
tect Canadians from the harm caused by anti-competitive conduct. Among other
things, these amendments decriminalized price maintenance conduct under the Act,
repealing the former criminal offence in section 61 and introducing a new non-
Guidelines
criminal provision in section 76. Under the new non-criminal provision, it is neces-
sary to demonstrate that price maintenance conduct has had, is having or is likely to
have an adverse effect on competition in a market.
The Enforcement Guidelines — Price Maintenance (Section 76 of the Competition
Act) (the “Guidelines”) describe the Bureau’s general approach to enforcing section
76 of the Act, including with respect to common business practices such as mini-
mum resale pricing, manufacturer-suggested resale pricing (“MSRP”) and mini-
mum advertised pricing (“MAP”). Issuance of these Guidelines supports the Bu-
reau’s Action Plan on Transparency, which aims to promote the development of a
more cost-effective, efficient and responsive agency, while providing Canadians
with more opportunities to learn about the Bureau’s work.
These Guidelines supersede all previous statements made by the Commissioner of
Competition (the “Commissioner”) or other Bureau officials regarding the Bureau’s
approach to the administration and enforcement of section 76 of the Act. These
Guidelines do not replace the advice of legal counsel and are not intended to restate
the law or to constitute a binding statement of how the Commissioner will exercise
discretion in a particular situation. The enforcement decisions of the Commissioner
* Price Maintenance (Section 76 of the Competition Act), Innovation, Science and Economic
1 R.S.C. 1985, c. C-34, as amended.
869
Price Maintenance Enforcement Guidelines
and the ultimate resolution of issues will depend on the particular circumstances of
the matter in question. Final interpretation of the law is the responsibility of the
Competition Tribunal (the “Tribunal”) and the courts.
The Bureau may revisit certain aspects of these Guidelines in light of experience
and changing circumstances.
1. — Executive Summary
Price maintenance under the Act occurs when a person influences upward or dis-
courages the reduction of another person’s selling or advertised prices by means of
a threat, promise or agreement, or when a person refuses to supply another person
or otherwise discriminates against them because of their low pricing policy, in each
case with the result that competition in a market is likely to be adversely affected.
More specifically, section 76 of the Act permits the Tribunal to make a remedial
order in respect of three types of price maintenance conduct where the conduct has
had, is having or is likely to have an adverse effect on competition in a market:
1. First, subparagraph 76(1)(a)(i) applies where a person, by agreement, threat,
promise or any like means, influences upward or discourages the reduction of
the price at which the person’s customer or any other person to whom the
product comes for resale supplies or offers to supply or advertises a product
within Canada. This can include minimum resale price, MSRP and MAP poli-
cies, and the Act sets out the circumstances in which such practices will be
deemed to influence prices.
2. Second, subparagraph 76(1)(a)(ii) applies when a person refuses to supply a
product or otherwise discriminates against a person or class of persons en-
gaged in business in Canada because of the low pricing policy of that person
or class of persons. However, the Act provides exceptions where the person
refused supply was engaged in certain conduct in respect of the products,
namely loss leadering, bait-and-switch selling, misleading advertising or not
providing the level of service that purchasers might reasonably expect.
3. Third, subsection 76(8) applies when a person, by agreement, threat, prom-
ise or any like means, induces a supplier, as a condition of doing business with
the supplier, to refuse to supply a product to a person or class of persons be-
cause of the low pricing policy of that person or class of persons.
Price maintenance practices are common in many markets, and can be pro-competi-
tive in many circumstances. For example, depending on the nature of the product,
price maintenance conduct can enhance non-price dimensions of intra-brand com-
petition, such as service and inventory levels, among competing retailers of the
same brand of product, and can correct “free-riding” among retailers. Price mainte-
nance conduct can also stimulate inter-brand competition among competing brands
of products, such as by facilitating the entry or expansion of competitors by encour-
870
aging retailers to stock and promote the supplier’s products, or by encouraging re-
tailers to engage in marketing efforts for a particular product.2
An important requirement under section 76 is that price maintenance conduct has
had, is having or is likely to have an adverse effect on competition in a market,
which is only likely to occur in some circumstances. This may occur, for example,
if price maintenance conduct resulted in the exclusion of rivals or new entrant com-
petitors to the supplier or the exclusion of discount or more efficient retail competi-
tors. It may also occur if price maintenance conduct was being used to inhibit com-
petition among suppliers or retailers.
When examining whether price maintenance conduct is likely to adversely affect
competition in a market, market power is a key factor in the Bureau’s analysis. In a
general sense, market power is the ability of a firm (or group of firms) to profitably
maintain prices above the competitive level, or other elements of competition, such
as quality, choice, service or innovation, below the competitive level, for a signifi-
cant period of time. Where price maintenance conduct is unlikely to create, pre-
serve or enhance market power, the conduct is unlikely to have an adverse effect on
competition in a market.
Upon finding that price maintenance conduct is likely to adversely affect competi-
tion in a market, the Tribunal may make a remedial order prohibiting the conduct.
Alternatively, the Tribunal may make an order requiring a supplier or a retailer, as
the case may be, to do business with another person on usual trade terms. The Act
Guidelines
provides that no order may be issued in respect of conduct that falls under para-
graph 76(1)(a) if the supplier and retailer are principal and agent, affiliated corpora-
tions, or representatives of the same entity or of affiliated entities.
In considering enforcement action under section 76 of the Act, the Bureau evalu-
ates allegations of price maintenance on a case-by-case basis, in the context of
structural and other market-specific characteristics. In the course of an examination
or inquiry, the Commissioner will generally afford parties the opportunity to re-
spond to the Bureau’s concerns regarding alleged contraventions of section 76 and
to propose an appropriate resolution to address them. Where the Bureau believes
that price maintenance conduct satisfies the elements of both section 76 and an-
other provision of the Act, the Bureau will generally base its choice of enforcement
provision on the particular facts of each case, the market situation and any other
relevant circumstances, including the nature of the remedy available under each
section of the Act.
2 The terms “supplier” and “retailer” are used in these Guidelines for convenience, to differ-
entiate persons operating at different levels of the distribution chain with respect to a product
(who may also or alternatively be competitors of each other). Use of the term “retailer”
should not be taken to suggest that the person necessarily supplies a product to consumers or
end-users; in some circumstances a “retailer” could be a “supplier” to persons other than
end-users of the product.
871
Pursuant to section 103.1 of the Act, private parties may seek leave of the Tribunal
to bring an application under section 76 if they are directly affected by conduct that
falls within the price maintenance provision.
2. — Influencing Upward or Discouraging the Reduction of Selling or

Advertised Prices of a Product (s. 76(1)(a)(i))
2.1 — The Statutory Elements
Subparagraph 76(1)(a)(i) of the Act applies where a person, by agreement, threat,
promise or any like means, influences upward or discourages the reduction of the
price at which the person’s customer or any other person to whom the product
comes for resale supplies or offers to supply or advertises a product within Canada.
Four elements must be established before subparagraph 76(1)(a)(i) can apply:
1. a type of person specified in subsection 76(3) of the Act;
2. by agreement, threat, promise or any like means;
3. directly or indirectly influences upward or discourages the reduction of sell-
ing or advertised prices of a product in Canada;
4. of the person’s customer or any other person to whom the person’s product
comes for resale.
2.1.1 — A Person Specified in Subsection 76(3) of the Act

Pursuant to subsection 76(3) of the Act, paragraph 76(1)(a) applies only to a person
that falls within one or more of the following three categories:
1. persons engaged in the business of producing or supplying a product;
2. persons who extend credit by way of credit cards or otherwise engage in a
business relating to credit cards; or
3. persons who have the exclusive rights and privileges conferred by a patent,
trade-mark, copyright, registered industrial design or registered circuit
topography.
The Bureau’s view is that, depending on the circumstances, section 76 may apply
to more than one person. For example, where several competing suppliers each
engage in price maintenance conduct within the scope of paragraph 76(1)(a) of the
Act, the Bureau may consider enforcement action against more than one of those
suppliers where there is an adverse effect on competition in a market resulting from
that price maintenance conduct. Where such conduct is the result of an agreement
between competitors or potential competitors, it could also raise issues under sec-
tion 45 of the Act, the criminal conspiracy provision, or section 90.1 of the Act, the
civil competitor collaboration provision, depending on the circumstances.
Notwithstanding that a person may fall under subsection 76(3) of the Act, subsec-
tion 76(4) provides that the Tribunal cannot issue a remedial order in respect of
conduct that falls under paragraph 76(1)(a) if the supplier and retailer are principal
and agent, affiliated corporations, or representatives of the same entity or of affili-
ated entities. Section 2 of the Act sets out the rules by which affiliation is to be
872
determined. The Bureau will consider relevant legal principles in determining

whether a valid agency relationship exists for the purposes of subsection 76(4).
2.1.2 — By Agreement, Threat, Promise or any Like Means

Subparagraph 76(1)(a)(i) of the Act applies to price maintenance conduct that
arises by way of an “agreement, threat, promise or any like means”. The Bureau
considers this element to include any conduct by which a supplier implicitly or
explicitly purports to either confer a benefit on a retailer who adheres to the sup-
plier’s influence on the retailer’s selling or advertised prices, or to impose a penalty
on a retailer if the retailer disregards the supplier’s influence on its prices.
2.1.3 — Directly or Indirectly Influences Upward or Discourages the

Reduction of Selling or Advertised Prices of a Product
Under subparagraph 76(1)(a)(i), it must be shown that the supplier’s price mainte-
nance conduct has directly or indirectly influenced another person’s selling or ad-
vertised prices upward or discouraged their reduction. An increase by a supplier in
the wholesale price of a product may lead to an increase in the price of a retailer’s
product. However, the Bureau will not consider a supplier’s increase of a wholesale
price, in and of itself, to have satisfied the requirement that the supplier influenced
upward or discouraged the reduction of selling or advertised prices of a product.
Guidelines
The Bureau’s approach in this respect is consistent with the Tribunal’s decision in
Visa/MasterCard, where the Tribunal concluded that an increase in prices in the
market in which a retailer sells or advertises a product as a consequence of the mere
exercise of market power by a supplier is not determinative.3 In other words, a
price increase in a downstream market is insufficient, in and of itself, to establish
that a particular supplier has directly or indirectly influenced upward or discour-
aged the reduction of a retailer’s prices.
The Tribunal considers that a supplier’s influence on a retailer’s selling or adver-
tised prices could represent something more than the mere exercise of market
power when, for example, the supplier’s conduct results in a retailer setting the
price of its product at a level higher than it would otherwise sell the product.4 Indi-
cations that the retailer has set the price above this level could include, for example,
evidence that the retailer’s price was lower prior to implementation of the price
maintenance conduct, or internal documentary evidence prepared in the ordinary
course of business that shows the retailer would have charged or advertised a lower
price absent the supplier’s price maintenance conduct.
Subparagraph 76(1)(a)(i) of the Act provides that a supplier’s influence on selling
or advertised prices may occur “directly or indirectly”. In the Bureau’s view, a “di-
3 The Commissioner of Competition v. Visa Canada Corporation and MasterCard

International Incorporated, 2013 Comp. Trib. 10 at para. 162 [Visa/MasterCard].
4 Ibid. at paras. 162 and 269.
873
rect” influence on prices will typically occur where a supplier specifies a particular
price to the retailer at or above which the retailer is to sell or advertise a product.
In contrast, an “indirect” influence on selling or advertised prices may occur where
a supplier does not specify a particular price, but nevertheless influences the level
of prices through non-price-based conduct, such as the terms and conditions on
which the supplier provides a product to a retailer. For example, and as the Tribu-
nal recognized in Visa/MasterCard, a supplier’s terms and conditions of sale may
reduce or eliminate downstream competitive forces that would otherwise discipline
the supplier’s upstream pricing, such that the supplier’s price for the product sup-
plied, and by extension the price of the retailer’s product, is higher than would be
the case absent the price maintenance conduct.5 Similarly, a supplier’s use of parity
agreements may also indirectly influence a retailer’s selling or advertised prices
upwards, for example, to the extent the agreement may prevent a retailer in a
lower-cost sales channel from setting prices at a level less than retailers in a higher-
cost sales channel.6
2.1.4 — Of the Person’s Customer or Any Other Person to Whom the

Supplier’s Product Comes for Resale
Subparagraph 76(1)(a)(i) provides that price maintenance conduct must influence
upward or discourage the reduction of “the price at which the person’s customer or
any other person to whom the product comes for resale supplies or offers to supply
or advertises a product within Canada”. While subparagraph 76(1)(a)(i), and sec-
tion 76 more generally, refers to “products”, both physical articles and services fall
within the scope of the provision.7
The Tribunal has interpreted this element of subparagraph 76(1)(a)(i) to mean that
a supplier’s customer, or any other person who obtains the supplier’s product, must
resell a product to another person, and that the product resold “should be identical
or substantially similar on the important characteristics of the product” supplied.8
This could be the case, for example, when a manufacturer distributes its products to
end-users through a network of distributors or retailers.
5 Ibid. at para. 321-322.

6 For the purposes of these Guidelines, the Bureau considers a “parity agreement”, broadly
speaking, to be a type of agreement pursuant to which a supplier’s customer is required to set
the selling or advertised price of a product not at a particular (absolute) level, but rather in
reference to the selling or advertised price of the product of another of the supplier’s custom-
ers or types of customers.
7 Subsection 2(1) of the Act defines a “product” to include an “article” and a “service”. The
term “article” is in turn defined broadly to mean real and personal property of every descrip-
tion, including energy, tickets, money and deeds and instruments relating to property or an
interest in a corporation or its assets. A “service” is also defined broadly to mean a service of
any description, whether industrial, trade, professional or otherwise.
8 Visa/MasterCard, supra note 3 at paras. 115 and 134.
874
That said, the Tribunal has not concluded that the product a retailer resells must be
identical to the product supplied to it by the supplier, or that it must be in the same
product market as the product supplied.9 For example, circumstances where the
product resold is repackaged, reapportioned, processed or transformed from the
product supplied, or is bundled with products other than the product supplied, could
satisfy the Tribunal’s interpretation where the product resold is substantially similar
on the important characteristics of the product supplied.
2.2 — Minimum Resale Price, MSRP and MAP Policies

In some circumstances, the Act deems a supplier’s use of minimum resale prices,
MSRP or MAP to satisfy the “influencing” requirement of subparagraph 76(1)(a)(i)
of the Act.
With respect to MSRP and minimum resale pricing practices, subsection 76(5) of
the Act stipulates that a supplier’s suggestion to a retailer of a resale price or a
minimum resale price for the product supplied is proof that the retailer has been
“influenced” in its pricing. The presumption does not apply, however, where the
supplier establishes that, in suggesting a price, it made clear to the retailer that the
person is under no obligation to accept the suggestion and will in no way suffer in
its business relations with the supplier or with any other person if it fails to accept
the suggestion.
Guidelines
With respect to advertised prices, subsection 76(6) of the Act stipulates that the
publication of an advertisement by a supplier, other than a retailer, that mentions a
resale price for the product is proof that the supplier is “influencing upward” the
selling price of any person to whom the product comes for resale. The presumption
does not apply, however, where the price is expressed in the advertisement in a way
that makes it clear to any person who may view the advertisement that the product
may be sold at a lower price. In the Bureau’s view, a supplier may establish this
latter exception where the advertisement clearly indicates, in plain language, that a
retailer may sell the product for less than the advertised price.
Pursuant to subsection 76(7) of the Act, subsection 76(5) and subsection 76(6) do
not apply to a price that is affixed or applied to a product or its package or
container.
Where a supplier establishes that an exception applies to the application of subsec-
tion 76(5) or subsection 76(6) of the Act, such that the supplier’s minimum resale
pricing, MSRP or MAP pricing practices are not deemed to satisfy the “influenc-
ing” requirement, this is not a complete defence to subparagraph 76(1)(a)(i) of the
Act. Rather, the Bureau may still establish, based on the available evidence, that the
supplier’s minimum resale pricing, MSRP or MAP pricing practices have in fact
influenced a retailer’s pricing.
9 Ibid. at para. 134.
875
3. — Refusing to Supply Due to a Low Pricing Policy (s. 76(1)(a)(ii))

Subject to the applicability of an exception in subsection 76(9) of the Act, subpara-
graph 76(1)(a)(ii) applies where a person refuses to supply a product or otherwise
discriminates against any person or class of persons engaged in business in Canada
because of the low pricing policy of that other person or class of persons.
Four elements must be established before subparagraph 76(1)(a)(ii) can apply:
1. refusal to supply a product or discrimination in the supply of a product;
2. to or against a person or class of persons engaged in business in Canada;
3. due to that person’s or class of persons’ low pricing policy;
4. by a type of person specified in subsection 76(3) of the Act.10
The refusal to supply provision in subparagraph 76(1)(a)(ii) of the Act shares simi-
larities with the general refusal to deal provision in section 75 of the Act. Where
evidence suggests that a refusal to supply has occurred due to a person’s low pric-
ing policy, the Bureau will typically examine such conduct under subparagraph
76(1)(a)(ii), rather than under section 75.
3.1.1 — Refusal to Supply a Product or Discrimination in the Supply of a

Product
Subparagraph 76(1)(a)(ii) of the Act encompasses two types of conduct: refusals to
supply a product and discrimination in the supply of a product. As is discussed in
Section 3.1.3 of these Guidelines, in each case the occurrence of the conduct must
be due to the low pricing policy of the person who is refused supply or discrimi-
nated against for subparagraph 76(1)(a)(ii) to apply.
A refusal to supply can be either express or constructive. In the Bureau’s experi-
ence, most alleged refusals to supply under section 76 are express, whereby a sup-
plier simply withholds supply of a product from a customer. However, owing to the
fact that an available remedy for refusals to supply under section 76 is an order
requiring a person to do business with a customer (or supplier, as the case may be)
“on usual trade terms”, the Bureau will also consider whether a supplier has con-
structively refused to supply a customer. Such constructive refusals could involve
price or non-price conduct by the supplier. With respect to the former, for example,
a wholesale price for the product supplied that is patently in excess of any price that
could reasonably be expected to be obtained for the product in a downstream mar-
ket could constitute a constructive refusal to supply. Non-price constructive refus-
als to supply could include, for example, delays in filling orders or filling orders in
an incomplete manner.
In the Bureau’s view, discrimination in the supply of a product based on another
person’s low pricing policy will typically occur when a supplier provides a product
to a customer at a price that is less favourable than the price at which the supplier
10 Section 2.1.1 of these Guidelines discusses the Bureau’s approach to subsection 76(3).
876
provides the same product to a similar customer that does not engage in a low
pricing policy. Thus, the Bureau considers that a supplier’s discriminatory pricing
to customers due to their low pricing policy will generally fall within the scope of
subparagraph 76(1)(a)(ii) of the Act. Discrimination may also take the form of non-
price conduct, such as supplying a product on less favourable terms or conditions
than are provided to other customers, or withholding certain benefits from custom-
ers that have a low pricing policy, such as marketing or advertising support in re-
spect of the product supplied.
For the purposes of subparagraph 76(1)(a)(ii) of the Act, a single incidence of a
refusal to supply or discrimination is sufficient to engage the provision. In other
words, there is no requirement that the conduct constitute a “practice” or that a
supplier engage in the conduct on multiple occasions or over a period of time. That
said, where the supplier’s conduct is isolated in time or in scope, it may be more
difficult to establish that the price maintenance conduct is likely to result in an
adverse effect on competition in a market.
3.1.2 — To or Against a Person or Class of Persons Engaged in Business in

Canada
Subparagraph 76(1)(a)(ii) applies only in respect of refusals to supply, or discrimi-
nation against, a person or class of persons engaged in business in Canada. The
Bureau considers a “class of persons” to be a group of firms that share common
Guidelines
distinguishing attributes or characteristics. The Bureau interprets the provision’s
reference to a “class of persons” to mean that it may apply when firms that do not
have a low pricing policy are refused supply or otherwise discriminated against
because they fall within a class of persons that, as a group, generally employs a low
pricing policy.
In determining whether a person or class of persons is “engaged in business in
Canada”, the Bureau will have regard to the definition of “business” in subsection
2(1) of the Act and previous Bureau guidance with respect to the location of a
business. In this latter respect, the Bureau’s Pre-Merger Notification Interpretation
Guideline Number 1 notes that a business with a physical location or office in Can-
ada will be considered to be “in Canada”, as may a business that is partly or
predominantly in another jurisdiction if it has some component or presence in Can-
ada.11 The Bureau will consider all relevant factors in determining whether a per-
son has a sufficient link to Canada so as to be considered to be engaged in business
in Canada, including the location of its tangible, intangible and financial assets, and
the nature of any revenues generated from sales to customers in Canada.12
11 Competition Bureau, Pre-Merger Notification Interpretation Guideline Number 1: Defini-

tion of “operating business” (Section 108 of the Act), 20 June 2011, p. 2.
12 See Competition Bureau, Pre-Merger Notification Interpretation Guideline Number 15:
Assets in Canada and Gross Revenues From Sales in, from or into Canada (Sections 109
and 110 of the Act), Draft for Public Consultation, 11 April 2012, p. 2 ff.
877
3.1.3 — Due to that Person’s or Class of Persons’ Low Pricing Policy

The Bureau considers that a refusal to supply or discrimination in the supply of a
product will have occurred “because of the low pricing policy” of a person or class
of persons where the low pricing policy is the proximate cause of the supplier’s
refusal or discrimination. To be clear, a person’s low pricing policy need not be the
only or even the primary reason for the refusal or discrimination, but rather a factor
informing the supplier’s decision.
The Bureau will consider any available evidence in assessing whether a refusal to
supply or discrimination in the supply of a product is due to another person’s low
pricing policy. For example, the Bureau will consider any statements by a supplier,
be they internal to the supplier or in external communications, that suggest a reason
for the refusal or discrimination is the other person’s low pricing policy. The Bu-
reau will also consider whether it is reasonable to infer from the other person’s low
pricing policy that such policy is in fact the proximate cause of the refusal to supply
or discrimination.
In this regard, a “low pricing policy” consists of two elements: “low pricing” and a
“policy”. Several factors may be relevant in assessing “low pricing”, including
whether the retailer’s price is below a supplier’s MSRP, MAP or other pricing sug-
gestions, and whether the retailer’s price is less than the price the retailer charges
for similar products or the price that other retailers typically charge for the same or
similar products. Because subparagraph 76(1)(a)(ii) (and subsection 76(8)) refer to
a “policy” rather than a “practice”, the Bureau considers that a retailer’s stated in-
tent with respect to a future course of low pricing conduct may constitute a low
pricing policy, even where the retailer has not yet engaged in the conduct. Con-
versely, a retailer that has engaged in low pricing conduct to a limited or isolated
extent could be considered not to have a “policy” of low pricing, depending on the
circumstances.
Section 76 of the Act does not require that a person’s “low pricing policy” be in
respect of a product previously supplied by the particular supplier who now refuses
to supply or discriminates in the supply of a product. In other words, the section
applies to circumstances where, for example, a person has a low pricing policy
generally, such as a discount retailer, and, on that basis, is refused supply of a prod-
uct that it has never previously purchased or resold. Thus, there is no requirement
that a person be an existing or previous customer of a supplier for the “refusal to
supply” provisions of section 76 to apply.
3.2 — Exceptions to the Applicability of Subparagraph 76(1)(a)(ii)

An exception to the applicability of subparagraph 76(1)(a)(ii) of the Act is availa-
ble to a supplier whose product has previously been resold by a person or class of
persons that engaged in certain conduct in respect of the product. In particular, pur-
suant to subsection 76(9) of the Act, the Tribunal cannot make a remedial order in
respect of a supplier’s refusal to supply or discrimination in the supply of a product
878
where the retailer was engaged in any of the following practices in respect of the
product:
• loss leadering, or more specifically, selling the product at a low price for the
purpose of advertising, rather than for the purpose of making a profit;
• bait-and-switch selling, or more specifically, using the product not for the pur-
pose of selling it at a profit, but for the purpose of attracting customers in the
hope of selling them other products;
• misleading advertising; or
• not providing the level of service that purchasers of the products might reason-
ably expect.
During the course of an investigation, the Bureau will consider any available evi-
dence that may suggest one or more of the above exceptions may apply. However,
in the Bureau’s view, a supplier that purports to rely on an exception in subsection
76(9) of the Act bears the burden of proving the applicability of the exception.
For any of the exceptions in subsection 76(9) to apply, the conduct in question must
have constituted a “practice” by the retailer. As the Bureau indicates in its Abuse of
Dominance Guidelines, a “practice” normally involves more than one isolated act,
but may also constitute a single act that is sustained and systemic or that has had or
is having a lasting impact in a market.13 With respect to the “misleading advertis-
ing” exception in paragraph 76(9)(c) of the Act, in determining whether an adver-
Guidelines
tisement is misleading, the Bureau will consider the factors relevant to an assess-
ment of allegedly false or misleading representations under sections 52 and 74.01
of the Act, including the literal meaning of the advertisement and the general im-
pression it conveys.
4. — Inducing a Supplier to Refuse to Supply a Person or Class of

Persons Due to that Person’s or Class of Persons’ Low Pricing
Policy (s. 76(8))
Subsection 76(8) of the Act applies when a person, by agreement, threat, promise
or any like means, induces a supplier, as a condition of doing business with the
supplier, to refuse to supply a product to a person or class of persons because of the
low pricing policy of that person or class of persons, with the result that competi-
tion in a market has been, is or is likely to be adversely affected.
Five elements must be established before subsection 76(8) can apply:
1. a person, as a condition of doing business with a supplier;
2. induces the supplier by agreement, threat, promise or any like means;
3. to refuse to supply a product to a particular person or class of persons;
13 Competition Bureau, Enforcement Guidelines: The Abuse of Dominance Provisions (Sec-

tions 78 and 79 of the Competition Act), 20 September 2012, Section 3.1 [Abuse of Domi-
nance Guidelines].
879
4. because of that person’s or class of persons’ low pricing policy;

5. with the result that the inducement has had, is having or is likely to have an
adverse effect on competition in a market.
Sections 3.1.1 and 3.1.3 of these Guidelines discuss the Bureau’s approach under
section 76 of the Act to refusals to supply attributable to another person’s or class
of persons’ low pricing policy, while Section 5 discusses the Bureau’s approach to
the competitive effects test. The two remaining elements of subsection 76(8) are
discussed below.
4.1.1 — A Person, as a Condition of Doing Business with a Supplier

In the Bureau’s view, subsection 76(8) applies both to a person that is currently
doing business with a supplier, as well as to a person that has not previously done
business with a supplier but who engages with the supplier with a view to doing
business. In other words, depending on the circumstances, the provision may apply
where a supplier refuses to supply a retailer in anticipation or expectation of secur-
ing the business of another person who induces the refusal as a condition of doing
business with the supplier.
Pursuant to subsection 76(8) of the Act, a supplier’s refusal to supply a person must
occur as a condition of another person doing business with the supplier. Put differ-
ently, the provision will not be engaged where a person induces a supplier to refuse
supply to another person if the person would have done business with the supplier
regardless of the success of the inducement.
4.1.2 — Induces the Supplier by Agreement, Threat, Promise or Any Like

Means
Section 2.1.2 of these Guidelines discusses the Bureau’s approach to the “agree-
ment, threat, promise or any like means” requirement of subparagraph 76(1)(a)(i)
of the Act, which approach the Bureau will similarly apply to subsection 76(8).
In the Bureau’s view, the requirement that a person “has induced” a supplier to
refuse to supply requires that any agreement, threat, promise or any like means
which a person brings to bear against a supplier actually results in a refusal to sup-
ply by the supplier. Thus, the Bureau considers that this element of subsection
76(8) will generally not be met where, for example, a supplier agrees with a person
to refuse supply to another person but does not actually implement the agreement.
Where an actual refusal to supply has occurred, the Bureau will consider whether
the refusal was “induced” by another person. In this regard, if it can be shown that
a supplier would have refused to supply a particular person regardless of any agree-
ment, threat, promise or any like means with or by another person, the Bureau will
not generally consider that other person to have “induced” the supplier’s refusal to
supply.
5. — Adverse Effect on Competition in a Market

Price maintenance conduct that falls under subparagraph 76(1)(a)(i), subparagraph
76(1)(a)(ii) or subsection 76(8) of the Act can be made subject to a remedial order
880
by the Tribunal only where the conduct “has had, is having or is likely to have an
adverse effect on competition in a market”. The Tribunal has held that, based on its
plain meaning, “adverse effect” is “a lower threshold” than “substantial lessening
or prevention of competition”, which is the standard for effects under sections 77,
79, 90.1 and 92 of the Act.14
The Tribunal has said that “without market power there can be no adverse effect in
a market”.15 In Visa/MasterCard, the Tribunal confirmed its approach in earlier
cases that for conduct to have an “adverse effect” on competition, the remaining
market participants must be placed in a position, as a result of the conduct, of cre-
ated, enhanced or preserved market power.16 As a result, the Bureau will be con-
cerned with price maintenance conduct under section 76 of the Act only where it is
likely to create, preserve or enhance market power.
The Bureau discusses its approach to assessing market power and competitive ef-
fects in its Abuse of Dominance Guidelines, Merger Enforcement Guidelines and
Competitor Collaboration Guidelines.17 When assessing adverse effects on compe-
tition in this context, the exercise is a relative one; the Bureau will compare the
level of competitiveness in the market in the presence of the particular price main-
tenance conduct with that which would exist in its absence to determine whether
the effect of the conduct, in the past, present or future, creates, preserves or en-
hances market power. In this regard, the Bureau will consider whether the price
maintenance conduct facilitates or is a result of coordination between suppliers or
Guidelines
retailers that inhibits their competitive vigour, or whether the conduct excludes ac-
tual or potential competition at the supplier or retailer level, such that in either case
the market would be more competitive in the absence of the price maintenance
conduct.
5.1 — Market Definition

Defining the relevant product and geographic markets is typically an important first
step in assessing a person’s ability to exercise market power. In defining relevant
markets for the purposes of section 76 of the Act, the Bureau will follow the ap-
proach to market definition set out in the Abuse of Dominance Guidelines.18
14 B.-Filer v. The Bank of Nova Scotia, 2006 Comp. Trib. 42 at para. 211 [B.-Filer].
15 Nadeau Poultry Farm Limited v. Groupe Westco Inc., 2009 Comp. Trib. 6 at para. 369
[Nadeau].
16 Visa/MasterCard, supra note 3 at para. 350. See also B-Filer, supra note 14, and Nadeau,
ibid.
17 Abuse of Dominance Guidelines, supra note 13; Competition Bureau, Enforcement
Guidelines: Merger Enforcement Guidelines, 6 October 2011 [Merger Enforcement Guide-
lines]; and Competition Bureau, Enforcement Guidelines: Competitor Collaboration Guide-
lines, 23 December 2009 [Competitor Collaboration Guidelines].
18 Abuse of Dominance Guidelines, ibid. at Sections 2.1 and 2.2.
881
In price maintenance cases, it can be particularly important to properly distinguish

between a product brand and a relevant product market. A particular brand of prod-
uct may not, in and of itself, constitute a separate relevant product market where
buyers of that product view other brands as substitutable products. That said, where
a relevant product market is comprised of several competing brands, the Bureau
will still assess the ability of any individual brand or brands to exercise market
power within that market, based on the factors laid out in Section 5.2 of these
Guidelines.
Of potential significance to market definition in price maintenance cases is the
proliferation of e-commerce. In some instances, suppliers may employ price main-
tenance practices, such as MSRP and MAP policies, differentially across sales
channels, such as between online and bricks-and-mortar retailers. In defining rele-
vant markets for the purposes of section 76, the Bureau may consider whether,
from a buyer’s perspective, different sales channels are most appropriately viewed
as competitive substitutes or complements. For example, an online sales channel
may supply a wider geographic market than a locally-based bricks-and-mortar sales
channel, and markets that would traditionally be defined around the physical store
locations of retailers may need to be viewed more broadly where products are sold
online.
5.2 — Market Power

In a general sense, market power is the ability of a firm (or group of firms) to
profitably maintain prices above the competitive level, or other elements of compe-
tition, such as quality, choice, service or innovation, below the competitive level,
for a significant period of time. In assessing market power for the purposes of sec-
tion 76 of the Act, the Bureau will follow the approach set out in the Abuse of
Dominance Guidelines.19
In price maintenance cases, the relevant market in which market power is to be
assessed may differ, depending on the conduct at issue and the particular provision
of section 76. Thus, the relevant question is whether a person(s), be it a supplier(s)
or a retailer(s), is able to profitably maintain its prices above the competitive level
as a result of price maintenance conduct.
The Bureau will consider both a firm’s pre-existing market power (i.e., any market
power held by the firm notwithstanding any price maintenance conduct) and any
market power derived from its price maintenance conduct. The Bureau will have
regard to any direct indicators of market power, such as profitability or supra-com-
petitive pricing, as well as qualitative and quantitative indirect indicators. In this
latter regard, the Bureau will consider a variety of factors, such as, market share,
including share stability and distribution, barriers to entry, including barriers cre-
ated as a result of any price maintenance conduct, and other market characteristics,
including the extent of technological change and retailer or supplier countervailing
power.
19 Ibid. at Section 2.3.
882
With respect to market share, the Bureau’s general approach is that a share of less
than 35 percent will typically not prompt further examination of whether the firm
possesses market power.20 However, consistent with the Tribunal’s finding in
Visa/MasterCard, the Bureau is of the view that a firm with a market share of less
than 35 percent could have some degree of unilateral market power in some in-
stances, depending on the characteristics of the relevant market.21
5.3 — Circumstances in Which Price Maintenance Conduct May

Adversely Affect Competition
From an economic perspective, price maintenance conduct can be pro-competitive
or anti-competitive, depending on the circumstances.22 In all cases, the conduct
reduces intra-brand price competition downstream, since retailers cannot compete
based on price in the sale of a particular branded product. At the same time, how-
ever, price maintenance conduct can be pro-competitive in many instances, by en-
hancing the overall level of demand in a market through the stimulation of inter-
brand competition and non-price dimensions of intra-brand competition.23 For ex-
ample, depending on the nature of the product, price maintenance conduct may:
• eliminate inefficiency in non-price dimensions of intra-brand competition
by, for example, correcting “free-riding” among downstream retailers. Absent
the conduct, discounting retailers of some types of products may free-ride on
the investments of full-service retailers that provide valuable product informa-
Guidelines
tion and services to buyers, causing full-service retailers to lose sales to dis-
counters and, as a result, to inefficiently reduce services. Price maintenance
conduct may prevent discounters from undercutting the prices of full-service
retailers, and may preserve incentives to offer efficient levels of service that
benefit consumers; and
• enhance inter-brand competition by providing retailers with a margin with
which to, for example:
• invest in promotional efforts, store enhancements or increased service, so
as to stimulate demand for the supplier’s product in competition with ri-
val retailers; or
• stock and promote new or competing product brands, thereby facilitating
entry or expansion.
Where price maintenance conduct is demand-enhancing in a market, the Bureau
believes the conduct is unlikely to create, preserve or enhance market power, so as
to have an adverse effect on competition in the market. However, in at least the
20 Ibid. at Section 2.3.1.

21 Visa/MasterCard, supra note 3 at para. 267.
22 See, e.g., Visa/MasterCard, ibid at para. 269.
23 The extent to which the overall level of demand in a market is likely to be enhanced as a
result of a product being subject to price maintenance conduct may depend on the nature of
the product.
883
following general circumstances, price maintenance conduct may be demand-re-

stricting, adversely affecting competition in a market and serving to create, pre-
serve or enhance market power:24
• Inhibiting competition between suppliers: Price maintenance conduct may
be used by suppliers to facilitate less-vigorous price competition among them,
or to help police a price-fixing arrangement;
• Inhibiting competition between retailers: One or more retailers may compel
a supplier to adopt price maintenance conduct to facilitate less-vigorous price
competition among them, or to help police a price-fixing arrangement;
• Supplier exclusion: An incumbent supplier may use price maintenance con-
duct to guarantee margins for retailers to make them unwilling to carry the
products of rival or new entrant competitors to the supplier. To the extent this
results in the foreclosure of downstream distribution channels to competing
suppliers, it may limit or reduce the ability of such suppliers to discipline the
supplier’s wholesale pricing, so as to enable the supplier to charge a price that
is higher than could be sustained absent the conduct; and
• Retailer exclusion: A person may compel a supplier to adopt price mainte-
nance conduct with the objective to exclude competition to a retailer(s) from
discount or more efficient retailers.
Supplier-based theories of harm are most likely to arise in the context of price
maintenance conduct under paragraph 76(1)(a) of the Act, while retailer-based the-
ories of harm are likely to be more common in respect of price maintenance con-
duct under subsection 76(8).25 More specifically, in the Bureau’s view, adverse
effects on competition as a result of price maintenance conduct that falls within
subparagraph 76(1)(a)(i) will typically manifest in the foreclosure of downstream
distribution channels and the exclusion of suppliers that would otherwise compete
with the firm engaging in the conduct. Similarly, in respect of price maintenance
conduct under subsection 76(8), the Bureau will consider whether the conduct has
excluded or is likely to exclude competitors of a retailer(s), such that prices in the
relevant market can be profitably maintained above, or non-pricedimensions of
competition in the relevant market can be profitably maintained below, the level
that would prevail absent the price maintenance conduct. Under either provision,
the Bureau will also consider whether the price maintenance conduct facilitates or
is a result of coordination at the supplier or retail lever that inhibits competitive
vigour in the market.
Price maintenance conduct that falls within subparagraph 76(1)(a)(ii) of the Act
also has the potential to exclude the retailer that the supplier refuses to supply or
otherwise discriminates against from the relevant market. However, because a re-
medial order in respect of conduct engaged in under this provision can only be
24 See Leegin Creative Leather Products, Inc. v. PSKS, Inc., 551 U.S. 877 (2007).
25 Depending on the facts of a case, the Bureau may evaluate the competitive effects of
specific price maintenance conduct under both paragraphs 76(1)(a) and subsection 76(8).
884
issued against the supplier, the Bureau will consider the extent to which the refusal
to supply has created, preserved or enhanced the supplier’s market power. For ex-
ample, if the product supplied occupies a significant position in the relevant mar-
ket, the supplier’s refusal to supply may cause the low pricing retailer to alter its
business practices to obtain supply, which may have an exclusionary effect on the
supplier’s competitors. The Bureau will also consider whether the supplier’s con-
duct facilitates or is a result of coordination with other suppliers that inhibits com-
petitive vigour in the market.
In some circumstances, price maintenance conduct may occur in connection with
agreements or arrangements between competing suppliers or competing retailers,
which arrangements may themselves engage section 45 or 90.1 of the Act. Simi-
larly, where price maintenance conduct is used to exclude competition, it may also
give rise to issues under section 77 and/or section 79 of the Act. Section 6 of these
Guidelines discusses the Bureau’s enforcement approach where the Bureau be-
lieves conduct may satisfy the elements of both section 76 and another provision of
the Act.
6. — Remedying Adverse Competitive Effects of Price Maintenance

Conduct
The Tribunal may issue remedial orders upon finding that price maintenance con-
duct is likely to adversely affect competition in a market. In respect of conduct that
Guidelines
falls under subparagraph 76(1)(a)(i) or 76(1)(a)(ii), the Tribunal may make an order
pursuant to subsection 76(2) of the Act prohibiting a person from engaging in the
conduct or requiring the person to accept another person as a customer within a
specified time on usual trade terms.26 In respect of conduct that falls under subsec-
tion 76(8), the Tribunal may make an order pursuant to that subsection prohibiting
a person from engaging in the conduct or requiring the person to do business with
another person on usual trade terms. Subsection 76(12) of the Act defines “trade
terms” to mean terms in respect of payment, units of purchase and reasonable tech-
nical and servicing requirements.
Prior to commencing formal proceedings with the Tribunal under section 76, the
Commissioner will generally afford parties the opportunity to respond to the Bu-
reau’s concerns regarding alleged contraventions of section 76 and to propose an
appropriate resolution to address them. A resolution to a matter could take many
forms along a continuum ranging from the discontinuance of an inquiry to a con-
sent agreement registered with the Tribunal pursuant to section 105 of the Act,
26 As noted in Section 2.1.2 and 3.2 of these Guidelines, the Tribunal cannot make an order
under subsection 76(2) of the Act in respect of:
1. conduct that falls under paragraph 76(1)(a) of the Act where an exception in subsec-
tion 76(4) applies; or
2. conduct that falls under subparagraph 76(1)(a)(ii) of the Act where an exception in
subsection 76(9) applies.
885
depending on the circumstances.27 Where a consensual resolution cannot be

reached, the Commissioner may file an application with the Tribunal.
As noted previously in these Guidelines, in some instances price maintenance con-
duct may also raise concerns under one or more other provisions of the Act. Pursu-
ant to subsection 76(11) of the Act, the Commissioner may not commence an appli-
cation under section 76 against a person on the basis of facts that are the same or
substantially the same as the facts on the basis of which the Commissioner has
commenced proceedings under section 45 or 49 or sought an order under section 79
or 90.1 of the Act.
Where the Bureau believes that price maintenance conduct satisfies the elements of
one or more provisions of section 76 and another section of the Act, the Bureau
will generally base its choice of enforcement provision on the particular facts of
each case, the market situation and any other relevant considerations, including the
circumstance that led to the introduction of the price maintenance conduct. The
Bureau’s decision will also be informed by the nature of the remedy under each
section of the Act, and the remedy that the Bureau believes is necessary to alleviate
the competitive harm in the particular case.
Section 103.1 of the Act allows private parties to seek leave of the Tribunal to
bring an application under section 76. The Tribunal may grant leave if it has reason
to believe that the applicant is directly affected by conduct that falls within the
price maintenance provision and that could be made subject to a remedial order
under section 76.
7. — Hypothetical Illustrative Examples

The following examples are intended to illustrate the analytical framework that the
Bureau will generally apply in conducting a review of alleged price maintenance
conduct. As with these Guidelines generally, the Bureau’s discussion of the exam-
ples below does not replace the advice of legal counsel and is not intended to re-
state the law or to constitute a binding statement of how the Commissioner will
exercise discretion in a particular situation. The enforcement decisions of the Com-
missioner and the ultimate resolution of issues will depend on the particular cir-
cumstances of the matter in question.
7.1 — Example 1 — Co-operative Advertising Agreement

Scenario
Company X is a leading supplier of gadgets, which are sold to end-user consumers
in Canada through an independent dealer network. X-branded gadgets are popular
with consumers, representing more than 50% of the overall gadget market.
One year ago, Company X entered into standard-form co-operative advertising
agreements with nearly all of its dealers. Pursuant to these agreements, Company X
27 For further information on the continuum of resolutions, please consult the Bureau’s In-
formation Bulletin on the Conformity Continuum, 18 June 2000.
886
reimburses its dealers, on a quarterly basis, 50% of the dealer’s cost of local audio
and visual promotional expenses in respect of X-branded gadgets, up to a maxi-
mum of 2% of the value of all X-branded gadgets sold by the dealer during the
quarter. To be eligible for the reimbursement, the co-operative advertising agree-
ments stipulate that dealers must market X-branded gadgets using terminology and
images pre-approved by Company X, and in addition must advertise X-branded
gadgets, including on the Internet and dealer websites, at Company X’s MAP.
While dealers are permitted to sell X-branded gadgets in-store for less than the
MAP and still receive reimbursement under the co-operative advertising agree-
ments, Company X prohibits dealers from noting in their advertisements that deal-
ers may sell for less.
Company X’s cooperative advertising reimbursement is a significant contributor to
dealer margins, since local advertising is a crucial driver of gadget sales. In prac-
tice, nearly all dealers today advertise and sell X-branded gadgets at Company X’s
MAP, and have prioritized the sales and marketing of advertising-supported X-
branded gadgets over competing gadget brands.
Analysis
The Bureau would typically examine a co-operative advertising arrangement of the
type described in this example under subparagraph 76(1)(a)(i) of the Act.28 For the
purposes of that provision, Company X: is a supplier within the meaning of subsec-
Guidelines
tion 76(3) of the Act; supplies X-branded gadgets to its dealers who sell a product,
in this case the supplied gadgets, to consumers; and has implemented the co-opera-
tive advertising arrangement with its dealers through an express written agreement.
As such, three of the four required elements for the applicability of subparagraph
76(1)(a)(i) are present in this case, leaving only the fourth element, a direct or indi-
rect influence by Company X on dealer selling or advertised prices, for
consideration.
Although dealer advertisements pursuant to the co-operative advertising agree-
ments omit any indication that dealers may sell X-branded gadgets for less than the
MAP, subsection 76(6) of the Act would not apply so as to deem the advertise-
ments to have influenced dealer prices upward. This is because the advertisements
are published by retailers, rather than Company X, and the deeming provision in
subsection 76(6) only applies to the publication of an advertisement by a supplier.
Absent applicability of the deeming provision, the Bureau would consider whether
the co-operative advertising agreements have in fact influenced upward or discour-
aged the reduction of dealer selling or advertised prices. Although a majority of
dealers today advertise and sell X-branded gadgets at Company X’s MAP, the Bu-
reau would still need to consider whether dealer pricing in this regard has been
28 Where a supplier employs a dual-distribution arrangement, selling to end-users itself and

through a dealer network, the Bureau may also examine a co-operative advertising agree-
ment or arrangement under one or more other of the Act’s civil provisions; see the Competi-
tor Collaboration Guidelines, supra note 17 at Section 2.3.3.
887
“influenced upward” by Company X. The Bureau would consider any indications

that, as a result of the co-operative advertising agreements, dealers advertise or sell
X-branded gadgets at a higher price than they would have in the absence of the
advertising reimbursement by Company X. For example, the Bureau would assess
whether, in the one year since Company X has implemented the co-operating ad-
vertising arrangement, dealers advertise or sell X-branded gadgets at a higher (in-
flation-adjusted) price than they did prior to implementation of the arrangement.
The Bureau would also have regard to any documentary evidence prepared by X-
branded gadget retailers in the ordinary course of business that shows the retailer
would have advertised or sold X-branded gadgets at a lower price absent the co-
operative advertising arrangement.
If it could be demonstrated that the co-operative advertising agreements had influ-
enced upward the advertised or selling prices of X-branded gadgets, the Bureau
would consider the competitive impact of the conduct in the relevant market. In this
regard, the Bureau would assess whether X-branded gadgets and other brands of
gadgets should appropriately be characterized as separate product markets or as a
single product market, and whether Company X possesses market power in the rel-
evant market.
If the relevant market was found to include all brands of gadgets and the Bureau
determined that Company X possessed market power in that market, based on its
apparent greater than 50% share of the gadget market and any evidence of barriers
to entry, the Bureau would consider to what extent Company X’s market power had
been preserved or enhanced as a result of the cooperative advertising agreements.
For example, the Bureau would consider whether dealers’ decisions to prioritize the
sales and marketing of advertising-supported X-branded gadgets over competing
gadget brands had excluded the entry or expansion of competitors, the presence of
which may have resulted in lower prices in the gadget market or an increase in
product quality, choice, service, innovation or another non-price dimension of com-
petition. In the presence of exclusionary effects, the Bureau may conclude that the
cooperative advertising agreements preserved or enhanced Company X’s market
power, so as to adversely affect competition in the gadget market.
7.2 — Example 2 — Refusal to Supply a Retailer

Scenario
Company Y manufactures and supplies widgets and, in that regard, competes with
four other widget suppliers, each of which (including Company Y) accounts for
approximately 20% of total annual sales in Canada. Widget suppliers, including
Company Y, sell widgets to end-user consumers through independent dealer net-
works in Canada. Some dealers operate only bricks-and-mortar stores, others sell
exclusively online, and still others sell online and in-store.
For most consumers, widgets are a relatively high-cost purchase, and thus consum-
ers demand a significant level of pre-purchase and after-sale support from dealers.
Some online dealers provide this support by telephone and through interactive web-
site chat. Nevertheless, not all widget suppliers are comfortable with the level of
888
support offered by online dealers. As such, at least two widget suppliers, including
Company Y, only distribute their widgets through dealers that agree to resell them
exclusively in bricks-and-mortar stores and not online.
Company A is an online and bricks-and-mortar widget dealer in Canada that has
been retailing the widgets of two suppliers. Company A seeks to expand its widget
line by carrying Y-branded widgets, and obtains supply from Company Y on the
condition that Company A not offer Y-branded widgets for sale online. Company Y
permits Company A to advertise Y-branded widgets on Company A’s website, and
places no restrictions on Company A’s advertised or retail price of Y-branded wid-
gets. Soon after Company A has commenced retailing Y-branded widgets, Com-
pany Y begins receiving complaints from consumers about a lack of product
knowledge, service and support in Company A stores, and complaints from its
other dealers about the very low prices charged by Company A for Y-branded wid-
gets. Although Company Y attempts to work with Company A to address these
service and pricing concerns, the complaints persist six months later. As such,
Company Y informs Company A that, due to these ongoing complaints, it is termi-
nating the parties’ dealer agreement and will no longer supply its widgets to Com-
pany A.
Analysis
Given the absence of any indication that Company Y was induced (by agreement,
Guidelines
threat, promise or any like means) by another of its dealers to cease supplying wid-
gets to Company A, the Bureau would typically examine the conduct in this exam-
ple under subparagraph 76(1)(a)(ii) of the Act.29 For the purposes of that provision:
Company Y is a supplier within the meaning of subsection 76(3) of the Act; Com-
pany Y has refused to supply widgets to Company A; and Company A is engaged
in business in Canada. As such, three of the four required elements for the applica-
bility of subparagraph 76(1)(a)(ii) are present in this case.
With respect to the fourth required element, the evidence suggests that Company Y
refused to supply widgets to Company A due, at least in part, to the latter’s low
pricing policy. Nevertheless, because product support and service is especially im-
portant in the widget industry, it is possible that Company Y would have continued
to supply Company A if it had satisfactorily addressed customer complaints about
service, even if Company Y continued to receive complaints from other dealers
about Company A’s low pricing. As such, the Bureau would consider any available
subjective and objective evidence in assessing whether Company A’s low pricing,
as opposed to its service, was a proximate cause of Company Y’s refusal to supply.
If Company Y’s refusal to supply widgets to Company A could be attributed to the
latter’s low pricing policy, the Bureau would consider any available evidence that
may suggest an exception in subsection 76(9) of the Act would preclude the appli-
29 The Bureau may instead examine the conduct in this example under section 75 of the Act,
the general refusal to deal provision, in those cases where there is no indication that the
refusal to supply was due to the customer’s low pricing policy.
889
cability of subparagraph 76(1)(a)(ii). In this case, in particular, the Bureau would

consider any evidence, including any evidence put forth by Company Y, that Com-
pany A made a practice of not providing the level of service that purchasers of Y-
branded widgets might reasonably expect. Such evidence in this case could include
documented consumer complaints received by Company Y.
Absent the applicability of an exception in subsection 76(9), and if the required
elements of subparagraph 76(1)(a)(ii) could be established, the Bureau would con-
sider the competitive impact in the relevant market of Company Y’s refusal to sup-
ply widgets to Company A. In this regard, the Bureau would assess whether the
relevant product market includes both Y-branded widgets and other widget brands,
and the scope of the market given the prevalence of bricks-and-mortar and online
sales channels. If the relevant market were to be defined as all widgets sold in
bricks-and-mortar and online channels in Canada, it would be unlikely that Com-
pany Y, with a market share of 20% and without evidence of competitor exclusion,
would be placed in a position of created, preserved or enhanced market power as a
result of the refusal to supply, so as to adversely affect competition in the market.
7.3 — Example 3 — Inducing a Supplier to Refuse to Supply Another

Person
Scenario
Company Z is a supplier of gizmos, which are sold to end-user consumers in Can-
ada through independent retailers. Owing to their nature, gizmos are sold only in
bricks-and-mortar stores, and not online. Gizmos are also highly differentiated,
with a multitude of brands, varieties and packaging sizes. End-user consumers gen-
erally purchase gizmos from local retailers, with many retailers in a given area
stocking full lines of gizmos. Z-branded gizmos currently account for approxi-
mately 10% of overall gizmo sales nationally.
Company B is the largest retailer by revenue of Z-branded gizmos in City T and
nationally, accounting for more than 50% of total citywide and national sales of Z-
branded gizmos. In an overall market for gizmos, however, Company B accounts
for only 20% of sales in City T and nationally. Company B operates three flagship
retail stores in City T, which offer extensive customer service in well-appointed
outlets located in prime retail areas.
Recently, Company C, a family-owned start-up, began retailing Z-branded and
other gizmos from a re-purposed warehouse located on the outskirts of City T in a
former industrial park. Due to its lower-cost location and no-frills service, Com-
pany C profitably sells gizmos at prices up to 20% lower than other retailers in City
T. As a result, Company C is capturing a growing share of gizmo sales in City T,
with Company B experiencing a significant decline in store visits and revenues.
Company B informs Company Z that, unless it ceases supplying gizmos to Com-
pany C in City T, Company B will stop purchasing from Company Z on a national
basis and only stock the gizmos of Company Z’s competitors. Nationally and in
City T, Company B is Company Z’s largest customer, and the profitability of its
business would be imperilled were Company Z to lose Company B as a customer.
890
Consequently, Company Z informs Company C that, effective immediately, it will

no longer supply it with gizmos. Some customers decide to purchase a different
brand of gizmos from Company C to benefit from its lower prices, while other
customers return to Company B’s stores to purchase Z-branded gizmos. Company
C believes it can remain in business, relying on sales of other gizmos from suppli-
ers who have not yet refused supply; however, Company C is fearful of the future
should those suppliers also come under pressure from Company B.
Analysis
The Bureau would typically examine the conduct of Company B in this example
under subsection 76(8) of the Act.30 For the purposes of that provision: Company B
is a customer of Company Z; Company B has induced Company Z to refuse to
supply gizmos to Company C by threatening to cease purchasing gizmos from
Company Z; Company B’s inducement was due to Company C’s low pricing pol-
icy in respect of Z-branded gizmos; and Company Z’s refusal to supply Company
C was a condition of Company B continuing to do business with Company Z. As
such, four of the five required elements for the applicability of subsection 76(8) are
present in this case.
With respect to the remaining element, the Bureau would consider whether Com-
pany B’s conduct has created, preserved or enhanced any market power, so as to
adversely affect competition in a relevant market. In this regard, the Bureau would
Guidelines
assess whether Z-branded gizmos and other brands of gizmos should appropriately
be characterized as separate product markets or as a single product market. In con-
sidering whether consumers view different brands of gizmos as substitutable, the
Bureau would assess, among other factors, the degree of consumer switching be-
tween brands, including in this case consumer switching between Company B,
Company C and other retailers in City T that may stock different gizmo brands.
From a geographic perspective, the Bureau would consider whether consumers
consider retailers from cities other than City T to be alternative viable sources of
gizmos.
If the relevant market were to be defined as all gizmo brands in City T, the Bureau
would assess whether Company B possess market power in that market, and
whether any market power it may have has been preserved or enhanced by its in-
ducement of Company Z to refuse to supply gizmos to Company C. In this regard,
the Bureau would consider Company B’s share of gizmo sales, which is only 20%.
In addition, the apparent ease of successful entry by Company C may suggest that
structural barriers to entry into the retail gizmo market in City T are not significant.
That said, the Bureau would also consider any strategic barriers to entry created by
Company B’s conduct. If it could be established that such a barrier to entry was
30 Depending on the circumstances (such as where one or more of the required elements of
subsection 76(8) cannot be established), the Bureau may instead examine the conduct under
section 79 of the Act, the abuse of dominance provision. The Bureau’s approach to the en-
forcement of section 79 is set out in the Abuse of Dominance Guidelines, supra note 13.
891
significant and would likely serve to exclude retail competitors, such that Company
B’s conduct would likely confer upon it market power in the gizmo market in City
T, the Bureau may determine that Company B’s conduct has had an adverse effect
on competition in the market.
Appendix: Section 76 of the Act

76. (1) Price maintenance — On application by the Commissioner or a person
granted leave under section 103.1, the Tribunal may make an order under subsection
(2) if the Tribunal finds that
1. a person referred to in subsection (3) directly or indirectly
1. by agreement, threat, promise or any like means, has influenced up-
ward, or has discouraged the reduction of, the price at which the person’s
customer or any other person to whom the product comes for resale sup-
plies or offers to supply or advertises a product within Canada, or
2. has refused to supply a product to or has otherwise discriminated
against any person or class of persons engaged in business in Canada
because of the low pricing policy of that other person or class of persons;
and
2. the conduct has had, is having or is likely to have an adverse effect on com-
petition in a market.
(2) Order — The Tribunal may make an order prohibiting the person referred to in
subsection (3) from continuing to engage in the conduct referred to in paragraph
(1)(a) or requiring them to accept another person as a customer within a specified
time on usual trade terms.
(3) Persons subject to order — An order may be made under subsection (2)
against a person who
1. is engaged in the business of producing or supplying a product;
2. extends credit by way of credit cards or is otherwise engaged in a business
that relates to credit cards; or
3. has the exclusive rights and privileges conferred by a patent, trade-mark,
copyright, registered industrial design or registered integrated circuit
topography.
(4) Where no order may be made — No order may be made under subsection (2)
if the person referred to in subsection (3) and the customer or other person referred
to in subparagraph (1)(a)(i) or (ii) are principal and agent or mandator and manda-
tary, or are affiliated corporations or directors, agents, mandataries, officers or em-
ployees of
1. the same corporation, partnership or sole proprietorship; or
2. corporations, partnerships or sole proprietorships that are affiliated.
(5) Suggested retail price — For the purposes of this section, a suggestion by a
producer or supplier of a product of a resale price or minimum resale price for the
product, however arrived at, is proof that the person to whom the suggestion is made
is influenced in accordance with the suggestion, in the absence of proof that the
producer or supplier, in so doing, also made it clear to the person that they were
under no obligation to accept the suggestion and would in no way suffer in their
892
business relations with the producer or supplier or with any other person if they
failed to accept the suggestion.
(6) Advertised price — For the purposes of this section, the publication by a pro-
ducer or supplier of a product, other than a retailer, of an advertisement that men-
tions a resale price for the product is proof that the producer or supplier is influenc-
ing upward the selling price of any person to whom the product comes for resale,
unless the price is expressed in a way that makes it clear to any person whose atten-
tion the advertisement comes to that the product may be sold at a lower price.
(7) Exception — Subsections (5) and (6) do not apply to a price that is affixed or
applied to a product or its package or container.
(8) Refusal to supply — If, on application by the Commissioner or a person
granted leave under section 103.1, the Tribunal finds that any person, by agreement,
threat, promise or any like means, has induced a supplier, whether within or outside
Canada, as a condition of doing business with the supplier, to refuse to supply a
product to a particular person or class of persons because of the low pricing policy
of that person or class of persons, and that the conduct of inducement has had, is
having or is likely to have an adverse effect on competition in a market, the Tribunal
may make an order prohibiting the person from continuing to engage in the conduct
or requiring the person to do business with the supplier on usual trade terms.
(9) Where no order may be made — No order may be made under subsection (2)
in respect of conduct referred to in subparagraph (1)(a)(ii) if the Tribunal is satisfied
that the person or class of persons referred to in that subparagraph, in respect of
Guidelines
products supplied by the person referred to in subsection (3),
1. was making a practice of using the products as loss leaders, that is to say,
not for the purpose of making a profit on those products but for purposes of
advertising;
2. was making a practice of using the products not for the purpose of selling
them at a profit but for the purpose of attracting customers in the hope of sell-
ing them other products;
3. was making a practice of engaging in misleading advertising; or
4. made a practice of not providing the level of servicing that purchasers of the
products might reasonably expect.
(10) Inferences — In considering an application by a person granted leave under
section 103.1, the Tribunal may not draw any inference from the fact that the Com-
missioner has or has not taken any action in respect of the matter raised by the
application.
(11) Where proceedings commenced under section 45, 49, 79 or 90.1 — No
application may be made under this section against a person on the basis of facts that
are the same or substantially the same as the facts on the basis of which
1. proceedings have been commenced against that person under section 45 or
49; or
2. an order against that person is sought under section 79 or 90.1.
893
(12) Definition of “trade terms” — For the purposes of this section, “trade terms”
means terms in respect of payment, units of purchase and reasonable technical and
servicing requirements.
R.S., 1985, c. C-34, s. 76; R.S., 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37;
2009, c. 2, s. 426

reau’s Information Centre.
Website
Address
Information Centre
Competition Bureau
50 Victoria Street
Gatineau, Quebec
K1A 0C9
Telephone
Toll-free: 1-800-348-5358
Facsimile
819-997-0324
894
INFORMATION BULLETIN ON THE
COMMUNICATION OF CONFIDENTIAL
INFORMATION UNDER THE COMPETITION ACT*
SEPTEMBER 2013
Information Bulletin on the Communication of Confidential

Information Under the Competition Act
The Competition Bureau (Bureau), as an independent law enforcement agency, en-
sures that Canadian businesses and consumers prosper in a competitive and innova-
tive marketplace. The Bureau investigates anti-competitive practices and promotes
compliance with the laws under its jurisdiction, namely the Competition Act (Act),
the Consumer Packaging and Labelling Act (except as it relates to food), the Tex-
tile Labelling Act and the Precious Metals Marking Act.
Guidelines
The Bureau endeavours to be as transparent as possible in providing information to
Canadians on the application of the laws under its jurisdiction. One of the ways it
does so is by issuing bulletins, which are policy statements describing the Bureau’s
approach to a variety of its enforcement tools, policies and procedures.
This Bulletin describes the policy of the Commissioner of Competition (Commis-
sioner) and the Bureau on the communication of confidential information obtained
in the course of the administration or enforcement of the Act. It has been updated to
reflect current legislation, policies and practices; it replaces and supercedes any
other publication or statement on the treatment of confidential information. This
Bulletin is intended to provide a general framework only and is not a substitute for
professional legal advice.
The Bureau is committed to treating confidential information responsibly and in
accordance with the law because maintaining confidentiality is fundamental to the
Bureau’s ability to pursue its responsibilities under the Act and to maintain its in-
tegrity as a law enforcement agency.
* Information Bulletin on the Communication of Confidential Information Under the

Competition Act, (September 30, 2013), Innovation, Science and Economic Development
Canada, https://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/vwapj/cb-bulletin-
confidential-info-2013-e.pdf/$file/cb-bulletin-confidential-info-2013-e.pdf. Reproduced with
the permission of the Minister of Innovation, Science and Economic Development, 2020.
The content of this publication may be subject to change or may be removed from the
895
Communication of Confidential Information
1. — Introduction
1.1 This Bulletin sets out the approach of the Commissioner and the Bureau1 with
respect to the communication of confidential information obtained in the course of
the administration or enforcement of the Act. It provides a general framework only.
In the administration and enforcement of the Act and when exercising discretion
under the Act, the Commissioner and the Bureau consider the specific circum-
stances of each matter.
1.2 The Act is a law of general application to business activities in Canada. Its
purpose is to maintain and encourage competition in the marketplace so as to pro-
vide for, among other objectives, an efficient and adaptive economy, competitive
prices and product choice for consumers, and accurate information in the market-
place. There are provisions in the Act governing the commencement and conduct of
formal inquiries by the Commissioner. There are also provisions providing the
Commissioner with formal powers to gather information for possible use as evi-
dence, as well as provisions governing the communication of information obtained
by the Bureau in the course of performing duties or functions under the Act, both
through informal means and through the exercise of formal powers.
1.3 The purpose of this Bulletin is to set out the Bureau’s policy on the communi-
cation of confidential information and to assure parties providing confidential in-
formation to the Bureau, whether voluntarily or pursuant to a specific provision of
the Act, that the Bureau takes seriously its duty to protect this information. While
the Act provides the persons performing duties or functions under the Act with
discretion to communicate confidential information to a Canadian law enforcement
agency or for the purposes of the administration or enforcement of the Act, main-
taining confidentiality is fundamental to the Bureau’s ability to pursue its responsi-
bilities under the law. The Bureau also recognizes that maintaining the confidenti-
ality of information and communicating such information only as allowed by law is
essential to its integrity as a law enforcement agency.
1.4 The Bureau is committed to treating confidential information responsibly and in
accordance with the law. It remains vigilant to avoid communicating confidential
information when dealing with matters under the Act, unless such communication
is permitted under section 29 of the Act or other statutory provisions pertaining to
confidentiality and, even when permitted, considers whether disclosure is, in the
circumstances, advisable or necessary. In other words, the general policy of the
1 The Commissioner is an independent law enforcement official appointed by the Governor

in Council and is responsible for the administration and enforcement of the Act. The Com-
missioner is the final decision maker at the Bureau. For the purposes of this Bulletin, the
terms “Commissioner” and “Bureau” are used interchangeably according to the topic dis-
cussed, but have effectively the same meaning for the purposes of interpretation of, and
practice under, section 29 of the Act. The terms are also used to include any “person who
performs or has performed duties or functions in the administration or enforcement of” the
Act.
896
Bureau is one of minimizing the extent to which confidential information is com-

municated to other parties.
2. — Applicable Legislation
2.1 Section 10 of the Act provides for the commencement of inquiries by the Com-
missioner. In addition to the specific confidentiality provisions of section 29, sub-
section 10(3) requires that all inquiries be conducted in private. In practice, the
Bureau extends this protection to all preliminary examinations being pursued to
determine whether or not grounds exist for the commencement of an inquiry by the
Commissioner.
2.2 Section 29, the key provision dealing with the communication of confidential
information in the possession or control of the Bureau, reads as follows:
29. (1) No person who performs or has performed duties or functions in the adminis-
tration or enforcement of this Act shall communicate or allow to be communicated
to any other person except to a Canadian law enforcement agency or for the pur-
poses of the administration or enforcement of this Act
(a) the identity of any person from whom information was obtained pursuant to
this Act;
(c) whether notice has been given or information supplied in respect of a par-
Guidelines
ticular proposed transaction under section 114;
(d) any information obtained from a person requesting a certificate under sec-
tion 102; or
(e) any information provided voluntarily pursuant to this Act.
(2) This section does not apply in respect of any information that has been made
public or any information the communication of which was authorized by the person
who provided the information.
2.3 Section 29 protects information obtained by or provided to the Bureau, includ-
ing the identities of the persons who provided the information, and any information
that could reveal their identities. Information may come to the Bureau in a variety
of ways, including the following:
• where the Commissioner has commenced an inquiry under section 10, through
court-authorized orders under section 11 (orders for oral examination, produc-
tion of records or written returns of information) or through court-authorized
search warrants under section 15 (search and seizures);
• for purposes of pre-merger notification under Part IX of the Act, through the
prescribed information required under subsection 114(1) or the additional in-
formation required under subsection 114(2);
• voluntarily from parties requesting advance ruling certificates under section
102;
• voluntarily from persons, particularly through filing complaints, making sub-
missions or responding to questionnaires and interviews during the course of
preliminary examinations and inquiries; and
897
• voluntarily from persons requesting binding written opinions under section

124.1.
2.4 In addition to the above, the Bureau or the Public Prosecution Service of Can-
ada may be in possession of information obtained pursuant to formal investigative
powers under the Criminal Code, particularly through search warrants, production
orders or wiretaps.. Accordingly, the communication of such information by the
Bureau may be subject to requirements under the Criminal Code and related regu-
lations and policies. Such information will also be treated as confidential under the
Act.
2.5 Notwithstanding subsection 29(1), subsections 29.1 and 29.2 of the Act allow
the Commissioner to communicate to the Minister of Transport or the Minister of
Finance information otherwise protected by section 29. These provisions are dis-
cussed in more detail below.
3. — General Approach
3.1 In the course of performing its duties under the Act, the Bureau often comes
into possession or control of confidential information, principally through the use
of formal powers or the provision of information on a voluntary basis. This infor-
mation comes from a variety of sources, including complainants, informants, indus-
try participants, suppliers, customers, industry experts, and Canadian or foreign law
enforcement agencies. Without access to such information, the Bureau cannot ef-
fectively administer and enforce the Act.
3.2 Section 29 effectively draws under its protection nearly all information that is
provided to or obtained by the Bureau in the course of executing its mandate under
the Act. This provision provides the Bureau with the discretion to communicate
information in four limited circumstances:
• communication of information to a Canadian law enforcement agency;
• communication of information for the purposes of administration or enforce-
ment of the Act;
• communication of information that has been made public; or
• communication of information when it has been authorized by the person who
provided the information.
3.3 As noted above, in addition to the protection provided by section 29, subsection
10(3) of the Act directs that all inquiries be conducted in private. Consistent with
that requirement, the Bureau will not normally comment publicly on the existence
of an inquiry or examination unless it has become public through another source,
through the filing of charges, through an application to the Competition Tribunal or
the courts, or, in the case of a completed merger review, through the Merger
Register.2
2 The Merger Register is available on the Bureau website.
898
3.4 When information has been made public or where persons providing informa-
tion authorize its communication to other parties, subsection 29(2) permits the dis-
closure of such information. Additionally, subsection 29(1) provides exceptions for
the communication of information to a Canadian law enforcement agency or for the
purposes of the administration or enforcement of the Act. The application of these
exceptions is at the discretion of persons performing duties or functions under the
Act and is exercised to carry out their responsibilities under the law. The Bureau
has practices in place to ensure that confidentiality is protected. The discretion to
communicate confidential information is exercised principally when not doing so
would prevent or hinder an inquiry or other matter from being addressed or dealt
with under the Act.
3.5 Generally, in the case of dealings with Canadian law enforcement agencies,
information will be communicated where such action is necessary to transfer a mat-
ter not within the Bureau’s mandate to the appropriate enforcement agency or when
the Bureau and the agency are engaged in cooperative action with respect to an
investigative matter. Communication of information to other parties, including
communication to foreign law enforcement agencies, falls under the exception for
the purposes of the administration or enforcement of the Act, and is undertaken
cautiously with the objective of addressing or dealing with an administrative or
enforcement matter under the authority of the Act. These issues are discussed in
more detail below.
Guidelines
3.6 Even in the case of formal proceedings before the Competition Tribunal or the
courts, when it is necessary to use confidential information, efforts to protect the
information from disclosure will be taken if such action does not hinder the admin-
istration or enforcement of the Act. Available measures include sealing orders, con-
fidentiality orders, confidential schedules to public documents and in camera pro-
ceedings. These measures are ultimately under the control of the Competition
Tribunal or the courts, and necessarily subject to the generally public nature3 of the
proceedings.
3.7 Section 29 does not require the Bureau to provide notice to any person who has
provided confidential information to the Bureau before exercising the discretion to
communicate the information pursuant to either exception in subsection 29(1). As a
general principle, the Bureau does not provide such notice as this would unreasona-
bly hinder the investigative process. However, there may be limited exceptions to
this general practice. Two examples are set out below.
3.7.1 When undertaking preliminary examinations of issues raised under the non-
merger civil provisions of Part VIII of the Act, the Bureau usually relies on infor-
mation protected by section 29 received from complainants at the initial stage of its
examination. In order to determine whether further investigative steps or a formal
inquiry is warranted, it is often necessary that the Bureau approach market partici-
3 Canada’s open court principle holds that judicial proceedings should be as open as possible
to foster transparent decision-making and increase public confidence in the administration of
justice.
899
pants, including the party or parties whose actions in the marketplace have given
rise to the complaint. Before doing so, and only at this preliminary stage, the Bu-
reau will seek the consent of the information provider to communicate information
protected by section 29 to these other parties. Usually it is only necessary to dis-
close to these third parties the identity of the information provider and the general
nature of the issue. If the information provider does not consent to the communica-
tion, the Bureau will normally indicate that without consent it is not likely that
further investigation of the matter will be fruitful. In such situations, the Commis-
sioner’s review of such matters will not likely proceed.
3.7.2 A second circumstance presents a more general exception to the issue of no-
tice by the Bureau to parties prior to the communication of their confidential infor-
mation. The Bureau receives a very large number of complaints every year relating
to false or misleading representations and deceptive marketing practices, some of
which fall more directly within the mandate of another organization. When ac-
knowledging receipt of such complaints, parties providing the information may be
told that in order to deal more effectively with the matter, their name and details of
their complaint may be forwarded to the relevant Canadian or foreign law enforce-
ment agency.
4. — Policy and Practice

4.1 — To Canadian Law Enforcement Agencies
4.1.1 The Act does not provide a definition of the term “Canadian law enforcement
agency”. In addition to municipal, provincial and federal police forces, the Com-
missioner’s view is that the term includes any federal or provincial authority that
enforces acts or regulations that provide for criminal, civil or administrative
sanctions.
4.1.2 As noted above, the authority to communicate information under section 29
of the Act is discretionary, although the Commissioner’s policy is to minimize the
communication of confidential information. Communication of information to Ca-
nadian law enforcement agencies by the Bureau is generally restricted to the fol-
lowing circumstances:
• to transfer information that the Bureau believes is required for the enforcement
operations of the agency, where the information reveals an apparent criminal
offence and, particularly, where there is a threat to public security or safety;
• to provide information in order to secure the necessary cooperation or assis-
tance of the agency in the administration or enforcement of the Act (e.g., as-
sistance in the execution of a search warrant). In such cases, the information is
generally limited to that necessary to enable the agency to provide the needed
assistance;
• when a Canadian law enforcement agency has expressly requested confiden-
tial information for the purpose of carrying out its mandate; and
• to share intelligence through the Bureau’s law enforcement partners to combat
more effectively mass marketing fraud, deceptive marketing practices, bid-rig-
ging and criminal conspiracies.
900
4.1.3 Except for matters relating to the provisions of the Act dealing with mislead-
ing representations and deceptive marketing practices, matters necessitating that the
Bureau communicate information to Canadian law enforcement agencies are rela-
tively few in number. Even then, the Bureau will communicate confidential infor-
mation only after it is satisfied that the receiving agency will respect the confidenti-
ality of the information to be communicated.
4.2 — For the Purposes of Administration or Enforcement of the Act

4.2.1 — General
4.2.1.1 The Bureau may also communicate confidential information for the pur-
poses of the administration or enforcement of the Act. Matters that may require
persons who perform duties or functions under the Act to exercise this discretion
are most often specific inquiries under section 10 or preliminary examinations.
They can also be more general matters, such as developing and participating in
national and international enforcement initiatives, and engaging in activities to ad-
vocate for competition. For all such matters, care is taken to refrain from, or to
minimize, the communication of confidential information.
4.2.1.2 More specifically, although not limited to the following, the communication
of confidential information for the purposes of administration or enforcement of the
Act may occur in the following situations:
Guidelines
• when eliciting information from market participants, such as customers, sup-
pliers or competitors, that may be used as evidence to determine whether the
Bureau’s or a third party’s assessment of a matter is accurate. In such situa-
tions, care is taken to refrain from, or to minimize, the communication of con-
fidential information. Such communication will only occur if it is not other-
wise reasonably possible to obtain the necessary information from these third
parties;
• obtaining an opinion or analysis by an industry, legal, economic or other ex-
pert on some or all aspects of the matter in question;4
• obtaining enforcement assistance from foreign law enforcement authorities;
• coordinating enforcement actions with foreign law enforcement authorities5;
• assessing the accuracy or the evidentiary value of information;
• making application to the courts for the use of formal investigative powers
under sections 11 or 15 of the Act;
4 Experts or other “temporary, technical and special assistants” retained under section 25 of
the Act are bound by the confidentiality provisions of the Act in the same way as Bureau
staff.
5 The Bureau will communicate confidential information only after it is fully satisfied of the
assurances provided by the foreign authority with respect to the confidentiality and use of the
information to be communicated.
901
• making application to the courts for the use of the wiretapping or production
order provisions contained in the Criminal Code; or
• initiating proceedings under the Act before the courts or the Competition
Tribunal.
4.2.1.3 Representations by the Commissioner before regulatory bodies under sec-
tions 125 and 126 of the Act are part of the administration or enforcement of the
Act. However, the issue of dealing with information protected by section 29 rarely,
if ever, arises. If, in the course of making an intervention, the issue of communicat-
ing confidential information were to arise, such communication would only take
place if measures were put in place to protect the confidentiality of the information
and if the information could not be obtained through the regulatory body’s own
processes.
4.2.1.4 Furthermore, it is the Bureau’s view that communicating the results of its
examinations and inquiries to the public is an important part of the administration
and enforcement of the Act. This communication is done through the Commis-
sioner’s Annual Report, as well as news releases and other publications. In publish-
ing such documents, the Bureau is guided by section 29 and subsection 10(3) of the
Act and by the principle of minimal disclosure. In certain limited circumstances, to
ensure the factual accuracy of a publication, the Bureau may allow cooperating
parties to review a publication shortly before it is published. While consideration
will be given to the comments of the party or parties, the Bureau will make the final
determination regarding the content of the document.
4.2.1.5 Finally, the Commissioner, as an advocate for competition, is engaged in
activities, such as market studies, that are designed to improve the understanding of
the effects of competition on the economy and to improve the effectiveness of the
Bureau’s application of the Act. Any confidential information voluntarily provided
to the Commissioner during the course of such activities is protected by section 29.
4.2.2 — Foreign Authorities

4.2.2.1 With the increasing globalization of business activities, including actions
that raise competition and consumer protection law issues in both the criminal and
civil fields, cooperation with foreign counterparts has become crucial to the effec-
tive enforcement and administrative activities of law enforcement authorities
around the world. To this end, the Bureau is committed to enhancing the effective-
ness of Canadian enforcement efforts through cooperation with foreign authorities
enforcing similar legislation. In conducting these cooperative activities, the Bureau
may need to communicate confidential information to a foreign authority, either on
its own initiative or on that of the foreign authority. The decision to communicate
confidential information to foreign authorities is not taken lightly.
4.2.2.2 While respecting the requirements of section 29, the Bureau may communi-
cate information in specific circumstances to foreign authorities to address a matter
under the Act. In all cases where confidential information is communicated to a
foreign authority, the Bureau seeks to maintain the confidentiality of the informa-
tion through either formal international instruments or assurances from the foreign
902
authority. The Bureau also requires that use of the confidential information by the
foreign authority be limited to the specific purposes for which it is provided.
4.2.2.3 Information sharing is a key component of many bilateral and multilateral
instruments, including cooperation agreements between Canada and other jurisdic-
tions, inter-agency arrangements between the Commissioner and foreign counter-
parts, and Recommendations of the Organization for Economic Cooperation and
Development (OECD) relating to cooperation. Communication by the Bureau of
confidential information will typically take place where there is a bilateral or multi-
lateral cooperation instrument in force. Any information communicated to a foreign
authority under the provisions of a bilateral or multilateral cooperation instrument
will be subject to specific confidentiality safeguards contained in that instrument,
as well as those in the Act and in other domestic legislation. Generally, where there
is no bilateral or multilateral cooperation instrument in force, the Bureau does not
communicate information protected by section 29 unless it is fully satisfied with
the assurances provided by the foreign authority with respect to maintaining the
confidentiality of the information and the uses to which it will be put.
4.2.2.4 As noted above, in the current globalized economy, with many industries
operating across borders, the investigation of anti-competitive activity under the
Act may necessitate working with and providing information to foreign law en-
forcement authorities. Specific kinds of potentially anti-competitive activity, such
as multijurisdictional cartel behaviour and cross-border mergers, may be subject to
Guidelines
cooperative investigations by authorities in two or more jurisdictions. Such investi-
gations can relate to the same product or geographic markets or to different but
closely related ones. In assessing whether to communicate confidential information
in these circumstances, the Bureau will consider the laws protecting confidentiality
in the requesting country, the purpose of the request, and any agreements or ar-
rangements with the country or the requesting authority. If the Bureau is not satis-
fied that the information will remain protected or be used only for its intended pur-
pose, the information will not be communicated.
4.2.2.5 A specific example of effective information exchange with foreign law en-
forcement authorities is the information-sharing protocols in place with respect to
mass marketing fraud and deceptive marketing practices. The Fair Business Prac-
tices Branch of the Bureau has agreed with its counterparts in Australia, the United
Kingdom and the United States to certain procedures for sharing information on
these matters. Furthermore, the Bureau may disclose information in complaints to
foreign authorities for the purposes of identifying and coordinating enforcement
actions or priorities on combating mass marketing fraud and deceptive practices,
such as telemarketing or internet-based scams and mail fraud schemes. Cooperation
among authorities is critical to investigating these activities, which often take ad-
vantage of the jurisdictional limitations and the autonomous actions of enforcement
authorities.
4.2.2.6 Likewise, foreign authorities typically communicate confidential informa-
tion to the Bureau on the understanding that the information will be treated confi-
dentially and used for the purposes of the administration or enforcement of the Act.
Whenever a foreign authority proposes or agrees to communicate confidential in-
903
formation, the Bureau is prepared to provide such assurances. If the Bureau intends
to use the information for any other purpose, before doing so, it will provide notice
to and seek the consent of the foreign authority.
4.2.2.7 Third parties may initiate legal actions to obtain access to confidential infor-
mation that is in the possession of the Bureau, where such information was pro-
vided by a foreign authority. In these rare situations, the Bureau will vigorously
resist the action and will make all appropriate legal arguments regarding confidenti-
ality and privilege to prevent disclosure. The Bureau will also notify any parties
who have provided information that is covered by such legal actions that an appli-
cation for access to that information has been made. The final disposition of such
matters rests with the courts.
5. — Mutual Legal Assistance Treaties

5.1 In addition to receiving confidential information under section 29, foreign au-
thorities may request information under bilateral and multilateral cooperation trea-
ties. These instruments do not compel state parties to share information, nor do they
provide any additional authorization to communicate confidential information.
These treaties are negotiated through the provisions of the Mutual Legal Assistance
in Criminal Matters Act for criminal matters or Part III of the Act for civil matters
(Mutual Legal Assistance), and are generally referred to as Mutual Legal Assis-
tance Treaties (MLATs).
5.2 MLATs are administered by Canada’s Department of Justice and typically al-
low the state parties to the treaties to request assistance in obtaining information
located in the other jurisdiction through such means as depositions, interviews,
searches and requests for records. These treaties include specific confidentiality
provisions. The evidence provided to a foreign jurisdiction under an MLAT is not
necessarily in the Bureau’s possession and may not involve an enforcement matter
that the Bureau is examining. Also, the information obtained by the Bureau as a
result of an MLAT request is not communicated pursuant to section 29, but pursu-
ant to the obligations arising from the MLAT. Assistance in civil matters may be
provided by way of an MLAT under Part III of the Act, which came into force in
June 2002. Part III of the Act contains specific confidentiality provisions in section
30.29.6
6 30.29 (1) No person who performs or has performed duties or functions in the admin-
istration or enforcement of this Act shall communicate or allow to be communicated
to any other person, except for the purposes of the administration or enforcement of
this Act,
(a) the contents of a request made to Canada from a foreign state or the fact of
the request having been made; or
(b) the contents of any record or thing obtained from a foreign state pursuant to
a Canadian request.
(2) No person who performs or has performed duties or functions in the administra-
tion or enforcement of this Act shall communicate or allow to be communicated to
904
5.3 It is beyond the scope of this Bulletin to discuss in detail matters under these
provisions and any applicable treaties.7
6. — To the Ministers of Transport and Finance

6.1 The Commissioner can communicate to the Minister of Transport or the Min-
ister of Finance under section 29.1 or 29.2, respectively, information otherwise pro-
tected under section 29, as well as “any information collected, received or gener-
ated by or on behalf of the Commissioner, including compilations and analyses”.
Such communication can only be made to the Minister of Transport when the infor-
mation is to be used for the purposes of sections 53.1 or 53.2 of the Canada Trans-
portation Act, or to the Minister of Finance for the purposes of making a decision
on a merger or proposed merger under the Bank Act, the Cooperative Credit As-
sociations Act, the Insurance Companies Act or the Trust and Loan Companies Act.
6.2 Requests by either Minister must specify the information that is required. In the
case of section 29.1, requests by the Minister of Transport must also state that the
information is required for the purposes of sections 53.1 or 53.2 of the Canada
Transportation Act and identify the transaction being considered thereunder. In the
case of section 29.2, requests by the Minister of Finance must also state that the
information is required to consider a merger or a proposed merger under the stat-
utes listed in the section or to determine whether to provide a certificate described
in paragraph 94(b) of the Act.8
Guidelines
6.3 In both cases, communication of any information provided by the Commis-
sioner can only be made to persons performing duties or functions relating to the
specific matters under consideration by the relevant Minister. There is no discretion
allowed under section 29.1 or 29.2 of the Act for further communication of the
any other person, except to a Canadian law enforcement agency or for the purposes
of the administration or enforcement of this Act, any information obtained under
section 30.06 or 30.11.
(3) This section does not apply in respect of any information that has been made
public.
7 More detailed information on the process under mutual legal assistance legislation and
individual treaties can be found in the Federal Prosecution Service Deskbook on the Public
Prosecution Service of Canada website. In addition, links to individual treaties can be found
on the website of the Treaty Section of the Department of Foreign Affairs and International
Trade.
8 94. The Tribunal shall not make an order under section 92 in respect of
...
(b) a merger or proposed merger under the Bank Act, the Cooperative Credit
Associations Act, the Insurance Companies Act or the Trust and Loan Compa-
nies Act in respect of which the Minister of Finance has certified to the Com-
missioner the names of the parties and that the merger is in the public inter-
est — or that it would be in the public interest, taking into account any terms
and conditions that may be imposed under those Acts.
905
information obtained by a person under either of those sections, except to other

persons exercising the same duties or functions.
7. — Other Topics
7.1 — The Bureau’s Immunity and Leniency Programs
7.1.1 The Bureau’s Immunity and Leniency Programs9 encourage parties who have
engaged in criminal anti-competitive conduct prohibited by the Act to come for-
ward to admit their illegal activity and offer to cooperate with the Bureau’s investi-
gation and any subsequent prosecution. Where an applicant party is the first to ap-
proach the Bureau and meets the requirements of the Immunity Program, the
Bureau will recommend that the Director of Public Prosecutions of Canada provide
the applicant with immunity from prosecution. The Bureau will recommend lenient
treatment in sentencing for subsequent applicant parties who approach the Bureau
and meet the requirements of the Leniency Program.
7.1.2 The Bureau treats as confidential the identity of a party requesting immunity
or leniency. The only exceptions to this policy are where:
• disclosure is required by law;
• disclosure is necessary to obtain or maintain the validity of a judicial authori-
zation for the exercise of investigative powers;
• disclosure is for the purpose of securing the assistance of a Canadian law en-
forcement agency in the exercise of investigative powers;
• the party has agreed to disclosure;
• there has been public disclosure by the party; or
• disclosure is necessary to prevent the commission of a serious criminal
offence.
7.1.3 Furthermore, the Bureau treats information obtained from a party requesting
immunity or leniency as confidential, subject only to the exceptions listed in 7.1.2
above, or where disclosure of such information is otherwise for the purpose of the
administration or enforcement of the Act.
7.1.4 Under the Immunity Program, the Bureau will not disclose the identity of a
party seeking immunity, or the information obtained from that party, to any foreign
law enforcement agency, without the consent of the party. Under the Leniency Pro-
gram, the Bureau will not disclose the identity of an applicant seeking leniency, or
the information obtained from that applicant, to any foreign law enforcement
agency without the consent of the applicant or unless required by law. The party’s
consent, in the context of immunity and leniency applications, is commonly re-
ferred to as a “waiver”.
9 For more detail, see the Immunity Program, Immunity Program FAQs, Leniency Program
and Leniency Program FAQs on the Bureau website.
906
7.1.5 It is the Bureau’s policy with respect to private actions under section 36 of the
Act to provide confidential information and evidence only in response to a court
order. In connection with information obtained under the Immunity and Leniency
Programs, the Bureau will take all reasonable steps to protect the confidentiality of
the information.
7.2 — Whistleblowing and Confidentiality10

7.2.1 Under section 66.1 of the Act (commonly referred to as the whistleblowing
provision), anyone who has reasonable grounds to believe that a person has com-
mitted or intends to commit a criminal offence under the Act may notify the Bureau
of the particulars of the matter and may request that his or her identity be kept
confidential. The Bureau will keep confidential the identity of a person who has
made such disclosure and to whom an assurance of confidentiality has been
provided11.
7.2.2 When a person has accepted such an assurance, his or her identity and any
information that could reveal his or her identity is confidential and cannot be com-
municated under section 29 of the Act without the consent of that person.
7.2.3 Information provided by a whistleblower, other than his or her identity and
any information that could reveal his or her identity, may be communicated under
section 29 of the Act in the four limited circumstances set out in section 3.2 of this
Guidelines
Bulletin. Where information provided by a whistleblower is communicated in such
circumstances, the Bureau will make every effort to ensure that the communicated
information does not disclose the identity of the whistleblower or any other infor-
mation that could reveal his or her identity.
7.3 — Binding Written Opinions

7.3.1 Promoting compliance with the Act is a fundamental objective of the Bureau.
Under section 124.1 of the Act, a person can apply to the Commissioner,12 with
supporting material, for a written opinion on the applicability of the Act to pro-
posed conduct or to a proposed practice, and the Commissioner may provide a writ-
ten opinion for the applicant’s guidance. If all the material facts necessary for the
10 For more information on the treatment of whistleblowers, see the Bureau’s website.
11 66.1 (1) Any person who has reasonable grounds to believe that a person has com-
mitted or intends to commit an offence under the Act, may notify the Commissioner
of the particulars of the matter and may request that his or her identity be kept confi-
dential with respect to the notification.
(2) The Commissioner shall keep confidential the identity of a person who has noti-
fied the Commissioner under subsection (1) and to whom an assurance of confiden-
tiality has been provided by any person who performs duties or functions in the
administration or enforcement of this Act.
12 For information on related fees and service standards, see Competition Bureau Fee and
Service Standards Handbook for Written Opinions and Competition Bureau Fee and Service
Standards Handbook for Mergers and Merger-Related Matters on the Bureau website.
907
opinion have been submitted by or on behalf of an applicant and they are accurate,
the written opinion is binding on the Commissioner.
7.3.2 The Bureau’s policy on the use of confidential information is unlikely to limit
the scope of this activity. Although the general policy on the communication of
confidential information applies to binding written opinions, these opinions are
based only on information provided by the party requesting the opinion and no
third party contacts are made.
7.3.3 An exception to this policy is with respect to requests for written opinions
addressing paragraph 74.01(1)(b) of the Act concerning representations relating to
the performance, efficacy or length of life of a product. In these cases, the Bureau
may seek independent review of any such claim or test relating to an applicant’s
product. As noted earlier, any individuals involved in a review are retained under
section 25 of the Act and are therefore bound by the confidentiality provisions in
section 29.
7.3.4 Furthermore, the situation may arise where actions on which a request for a
binding written opinion has been made become, at a later time, subject to, part of,
or relevant to an investigation or inquiry under the Act. At that time, information
provided to the Bureau in respect of the request would be treated under section 29
in accordance with the principles and policy set out in this Bulletin.
7.4 — The Right of Access to Records

7.4.1 Section 18 of the Act deals with the care and detention of records or other
things obtained under sections 11, 15 or 16 of the Act. Subsection 18(2) of the Act
entitles persons from whom such records or other things were obtained to inspect
them. The Act does not provide any right to inspect records or other things to per-
sons other than those from whom they were produced or obtained.
7.5 — Requests under the Access to Information Act

7.5.1 The purpose of the Access to Information Act (ATIA) is to provide members
of the Canadian public access to information contained in records under the control
of a government institution. Under the ATIA, the Department of Industry is the
government institution of which the Bureau is a part. While the ATIA sets up a
general right of access, it contains provisions allowing for exemption from disclo-
sure for specified types and classes of records. The most important is the
mandatory exemption under section 24 of the ATIA for disclosure of records con-
taining information covered by section 29 of the Act. For practical purposes, this
exemption covers all third party confidential information contained in Bureau
records.
7.6 — Private Actions for Damages

7.6.1 Under section 36 of the Act, private parties can commence legal action to
recover damages incurred as a result of conduct contrary to Part VI of the Act or
the failure of any person to comply with an order of the Competition Tribunal or a
court under the Act. Persons contemplating actions under section 36 may believe
908
that the Bureau possesses information, such as information obtained as a result of

the use of formal investigative powers, which could be relevant to their claims.
However, it is important to note that section 36 does not provide a general right of
access to records in the Bureau’s possession or control.
7.6.2 To preserve the independence necessary to carry out the Bureau’s mandate
effectively and to protect the integrity of the Bureau’s investigative process and the
confidentiality of information in its possession, the Bureau will not voluntarily pro-
vide information to persons contemplating or initiating a section 36 action.
7.6.3 If served with a subpoena, the Bureau will inform the information provider
and oppose subpoenas for production of information if compliance with them
would potentially interfere with an ongoing examination or inquiry, or otherwise
adversely affect the administration or enforcement of the Act. If the Bureau’s oppo-
sition is unsuccessful, it will seek protective court orders to maintain the confidenti-
ality of the information in question.
7.7 — Private Access to the Competition Tribunal

7.7.1 Section 103.1 of the Act permits private parties to apply for leave to make an
application to the Competition Tribunal for remedial orders under sections 75 (re-
fusal to deal), 76 (price maintenance) and 77 (tied selling, exclusive dealing and
market restriction) of the Act. Under section 103.2, the Commissioner may inter-
Guidelines
vene in any application made under sections 75, 76 or 77 by a person granted leave
under section 103.1. When such interventions are made, the Bureau’s policy with
respect to the communication of confidential information will be the same as with
other applications before the Tribunal or courts.
7.7.2 If the Commissioner does not intervene, and if one of the parties involved in
an application under section 103.1 requests confidential information or records in
the possession of the Bureau, the request will be treated in the same manner as a
request made by a party to an action initiated under section 36.

Website
Address
Information Centre
Competition Bureau
50 Victoria Street
909
Telephone
Toll-free: 1-800-348-5358
Facsimile
819-997-0324
910
INTELLECTUAL PROPERTY ENFORCEMENT
GUIDELINES*
Enforcement guidelines
March 13, 2019
Preface
and innovative marketplace. The Bureau investigates anti-competitive practices and
promotes compliance with the laws under its jurisdiction, namely the Competition
Act (the “Act”), the Consumer Packaging and Labelling Act (except as it relates to
food), the Textile Labelling Act and the Precious Metals Marking Act.
The Bureau endeavours to be as transparent as possible in providing information to
Guidelines
Canadians on the application of the laws under its jurisdiction. One of the ways it
does so is by issuing enforcement guidelines, which describe the Bureau’s general
approach to enforcing specific provisions in the Act.
Intellectual property (“IP”) and IP rights are increasingly important in today’s
knowledge-based economy. In such an environment, there has been interest in how
the Bureau will deal with competition issues involving IP. Accordingly, the Bureau
has made it a priority to provide increased clarity on this subject.
These Intellectual Property Enforcement Guidelines (the “Guidelines”) articulate
how the Bureau approaches the interface between competition policy and IP rights.
They describe how the Bureau will determine whether conduct involving IP raises
an issue under the Act. They also explain how the Bureau distinguishes between
those circumstances that warrant a referral to the Attorney General under section 32
of the Act, and those that will be examined under the general provisions. Because
of their subject matter, the Guidelines are necessarily technical in nature and are
primarily targeted to IP and competition law practitioners.
These Guidelines are not intended to restate the law or to constitute a binding state-
ment of how the Commissioner will exercise discretion in a particular situation.
* Intellectual Property Enforcement Guidelines, Innovation, Science and Economic

Development Canada, https://www.ic.gc.ca/eic/site/cb-bc.nsf/eng/04421.html. Reproduced
with the permission of the Minister of Innovation, Science and Economic Development,
2020. The content of this publication may be subject to change or may be removed from the
911
Intellectual Property Enforcement Guidelines
The enforcement decisions of the Commissioner and the ultimate resolution of is-
sues will depend on the particular circumstances of each case. Final determination
of the law is the responsibility of the Competition Tribunal (the “Tribunal”) and the
courts.
The Bureau will review these Guidelines as needed based on experience, changing
circumstances and decisions of the Tribunal and the courts.
Matthew Boswell
Table of Contents
1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 912
2. Overview of IP Law and Competition Law . . . . . . . . . . . . . . . . . . 915
3. Interface between IP and Competition Law . . . . . . . . . . . . . . . . . 918
4. Applying the Act to Conduct Involving IP . . . . . . . . . . . . . . . . . . 920
5. The Analytical Framework in the Context of IP . . . . . . . . . . . . . . 926
6. Competition Policy Advocacy . . . . . . . . . . . . . . . . . . . . . . . . . . . . 931
7. Application of Competition Law to IP . . . . . . . . . . . . . . . . . . . . . . 932
1. — Introduction
1. Today’s economy is increasingly based on knowledge and innovation and driven
by rapid advancements in information and communications technologies. New
technologies create economic, cultural, social and educational opportunities for
people to put ideas to work in innovative ways that increase productivity and create
employment and wealth. Adequate protection of IP plays an important role in stim-
ulating new technology development, artistic expression and knowledge dissemina-
tion, all of which are vital to the knowledge-based economy.1 In this context, IP
1 The World Intellectual Property Organization defines IP and summarizes the role of IP
rights as follows: “Intellectual property (IP) refers to creations of the mind, such as inven-
tions; literary and artistic works; designs; and symbols, names and images used in com-
merce. IP is protected in law by, for example, patents, copyright and trademarks, which en-
able people to earn recognition or financial benefit from what they invent or create. By
striking the right balance between the interests of innovators and the wider public interest,
the IP system aims to foster an environment in which creativity and innovation can flourish.”
For more information, see the World Intellectual Property Organization’s website.
912
becomes a valuable asset for firms’ profitability and growth. However, given the
importance of IP, there is a risk that it may be used strategically to engage in anti-
competitive conduct.
2. Owners of IP, like owners of any other type of private property, profit from
property laws that define and protect owners’ rights to exclude others from using
their private property. The special characteristics of IP have made it necessary in
many instances for governments to develop laws that confer property rights to IP
comparable to those for other kinds of private property.
3. IP laws and competition laws are two complementary instruments of government
policy that promote an efficient economy. IP laws provide incentives for innovation
and technological diffusion by establishing enforceable property rights for the cre-
ators of new and useful products, technologies and original works of expression.
Competition laws may be invoked to protect these same incentives from anti-com-
petitive conduct that creates, enhances or maintains market power or otherwise
harms vigorous rivalry among firms. Given that competition law may result in limi-
tations on the terms and conditions under which the owners of IP rights may trans-
fer or license the use of such rights to others, and on the identity of those to whom
the IP is transferred or licensed, these Guidelines seek to clarify the circumstances
under which the Bureau would consider such intervention to be appropriate and
also illustrate situations that would not call for intervention under the Act.
4. In the interest of transparency, the Bureau recognizes the importance of provid-
Guidelines
ing information on its treatment of IP under the Act. This document sets out how
the Bureau views the interface between IP law and competition law. It also explains
the analytical framework that the Bureau uses to assess conduct involving IP.
5. The Guidelines discuss the circumstances in which the Bureau, under the Act,
would seek to restrain anti-competitive conduct associated with the exercise of IP
rights to maintain competitive markets. The approach elaborated in this document
is based on the premise that the Act generally applies to conduct involving IP as it
applies to conduct involving other forms of property.
6. The Bureau’s overall approach to the application of the Act to IP is as follows:
1. The circumstances in which the Bureau may apply the Act to conduct in-
volving IP or IP rights fall into two broad categories: those involving some-
thing more than the mere exercise of the IP right, and those involving the mere
exercise of the IP right and nothing else. The Bureau will use the general pro-
visions of the Act to address the former circumstances and section 32 (special
remedies) to address the latter.
2. In either case, the Bureau does not presume that the conduct violates the
general provisions of the Act or needs to be remedied under section 32.
3. When conduct involving an IP right warrants a special remedy under sec-
tion 32, the Bureau will act only in the very rare circumstances described in
this document and when the conduct cannot be remedied by the relevant IP
statute.
4. The analytical framework that the Bureau uses to determine the presence of
anti-competitive effects stemming from the exercise of rights to non-IP forms
913
of property is sufficiently flexible to apply to conduct involving IP, even

though IP has important characteristics that distinguish it from other forms of
property.
7. Circumstances will determine how the Bureau uses its enforcement discretion to
respond to any alleged contravention of the Act. Therefore, individuals contemplat-
ing a business arrangement involving IP should either consult qualified legal coun-
sel or contact the Bureau when evaluating the risk of the arrangement contravening
the Act. The final interpretation of the law rests with the Tribunal and the courts.
8. When developing these Guidelines, the Bureau considered the current global ec-
onomic and technological environment and, in particular, the rapid rate of techno-
logical changes occurring in many industries. The Bureau also took into account its
past enforcement experience, Canadian case law, and guidance documents released
in other jurisdictions such as the United States and the European Union. The Bu-
reau recognizes that the interface between competition and IP policy is constantly
evolving and that a single enforcement approach may not be appropriate for all
jurisdictions. Accordingly, to ensure appropriate coordination between Canadian IP
and competition law and policy, the Bureau entered into a Memorandum of Under-
standing with the Canadian Intellectual Property Office (“CIPO”) that will serve to
identify areas of mutual interest and facilitate discussions between the two
agencies.
9. The remainder of this document is organized into six parts:
1. Part 2 discusses the purpose of IP laws, lists the various IP statutes, reviews
the purpose of competition law and lists the principal provisions of the Act
that relate to IP;
2. Part 3 discusses the interface between IP law and competition law;
3. Part 4 outlines the principles underlying the application of the general pro-
visions and section 32 of the Act to business conduct involving IP;
4. Part 5 describes the Bureau’s analytical framework, which is sensitive to the
particular characteristics of IP;
5. Part 6 discusses the Bureau’s mandate to promote competition, which may
include intervening in proceedings in which IP rights are being defined,
strengthened or extended inappropriately; and
6. Part 7 presents a discussion and a series of hypothetical scenarios to illus-
trate how the Bureau would apply the Act to a wide variety of business con-
duct involving IP, including price-fixing; exclusive licensing; contracting; pat-
ent pooling; competitor collaborations; refusals to license; product switching
and the settlement of patent litigation proceedings in the pharmaceutical in-
dustry; the sending of false and misleading claims; and certain forms of con-
duct in the context of standards development organizations.
914
2. — Overview of IP Law and Competition Law

2.1 — IP Law
10. IP laws create legally enforceable private rights that protect to varying degrees
the form and/or content of information, expression and ideas. The primary purpose
of these laws is to promote innovation and creativity by defining the scope of these
rights and determining under what circumstances they have been infringed or vio-
lated. While the nature and scope of protection provided by each IP-related statute
is different, by protecting exclusive rights, the IP laws provide an incentive to pur-
sue scientific, artistic and business endeavours that might not otherwise be
pursued.2
11. In the Guidelines, IP rights include rights granted under the Patent Act, the
Trade-marks Act,3 the Copyright Act, the Industrial Design Act, the Integrated Cir-
cuit Topography Act and the Plant Breeders’ Rights Act. CIPO grants or registers
ownership for five types of IP: patents, trademarks, copyrights, industrial designs
and integrated circuit topographies. The term “IP rights” also encompasses the pro-
tection afforded IP at common law and the Civil Code of Quebec, including that
given to trade secrets and unregistered trademarks.
Patents
12. Patents cover new inventions (process, machine, manufacture, composition of
Guidelines
matter) or new and useful improvements to an existing invention. A patent grants
an inventor the right to exclude others from making, using or selling the invention
within Canada for 20 years from the date of filing the application. The patent appli-
cation, which includes a full description of the invention, is available to the public
18 months after filing.
Trademarks
13. Trademarks are words, sounds or designs (or a combination of these) used to
distinguish the goods or services of one person or organization from those of others
in the marketplace. Registration protects the trademark from misuse and gives the
owner exclusive rights to use it, in association with the goods and/or services for
which the mark is registered, throughout Canada for renewable 15 year periods.
2 It is important to note that in the context of patents, in addition to the granting of exclusive
rights, the requirement of the inventor to provide and make public, a full description of the
invention also plays an important role in stimulating innovation by allowing others to benefit
from advances in technology and knowledge.
3 Although the same general competition law principles apply to trademarks as to other
forms of IP, the Guidelines are generally concerned with technology transfer and innovation-
related issues. Consequently, when applying its enforcement approach to trademarks, the
Bureau will additionally consider in its analysis the source and quality differentiation issues
that arise in respect of trademarks.
915
Copyright
14. Copyright is the sole right to produce, reproduce, publish or perform an original
literary, artistic, dramatic or musical work (including computer programs) for a
limited term. Copyright also applies to performances, sound recordings and com-
munication signals. Generally, copyright lasts for the life of the author, the remain-
der of the calendar year in which the author dies, and for 50 years following the end
of that calendar year.
Industrial Designs
15. An industrial design consists of the visual features of a shape, configuration,
pattern or ornament, or any combination of these features, applied to a finished
article. An industrial design must have features that appeal to the eye. To be eligi-
ble for registration, the design must be original. Registration provides exclusive,
legally enforceable rights for up to 10 years in Canada.
Integrated Circuit Topographies

16. Integrated circuit topography refers to the three-dimensional configuration of
electronic circuits embodied in integrated circuit products or layout designs. Regis-
tration offers exclusive rights for up to 10 years on an original circuit design, and
protection can extend to the layout design as well as to the finished product.
Plant Breeders’ Rights

17. The Canadian Food Inspection Agency administers the Plant Breeders’ Rights
Act, which grants the owner of a new plant variety the exclusive rights to produce
for sale, and to sell, reproductive material of the variety. It provides legal protection
for up to 25 years for a variety of tree or vine (including their rootstocks) and 20
years for all other plant varieties.
IP Statute Remedies
18. It is important to note that some remedies are available under the IP-related
statutes to protect against abuses. For example, as stipulated in section 65 of the
Patent Act, commencing three years after the grant of a patent, a party may apply to
the Commissioner of Patents alleging abuse of the patent through unduly restrictive
licensing conditions. If the Commissioner of Patents is satisfied that there has been
abusive conduct, there are a number of actions he/she may take, including ordering
that the patent be revoked or licensed to the applicant on such terms as the Com-
missioner of Patents may think expedient.
2.2 — Competition Law

19. The principle underlying competition law is that the public interest is best
served by competitive markets, which are socially desirable because they lead to an
efficient allocation of resources. Competition law seeks to prevent companies from
inappropriately creating, enhancing or maintaining market power that undermines
916
competition without offering offsetting economic benefits.4 Market power refers to

the ability of firms to profitably cause one or more facets of competition, such as
price, output, quality, variety, service, advertising or innovation, to significantly
deviate from competitive levels for a sustainable period of time.5 However, a firm
would not contravene the Act if it attains its market power solely by possessing a
superior product or process, by introducing an innovative business practice or by
other reasons of exceptional performance.6
20. The provisions of the Act that set out when it may be necessary for the Bureau
to intervene in business conduct, including conduct involving IP, fall into two cate-
gories: those that cover criminal offences and those that cover reviewable matters.
Several reviewable matters provisions state that the Bureau must, before it inter-
venes, show that the conduct substantially lessens or prevents competition.7
21. Criminal offences include conspiracy (section 45), bid-rigging (section 47), and
some forms of misleading advertising and related deceptive marketing practices
(sections 52 to 55). These provisions do not require proof of market power or anti-
competitive effects. Some of them (sections 45, 47, 52 and 52.01) have a mens rea
component; that is, proof is required that the defendant had the required intent to
engage in the criminal conduct.
22. The provisions on reviewable matters deal with conduct that is generally pro-
competitive but that may, in certain circumstances, significantly constrain competi-
tion. Reviewable matters include misleading advertising and related deceptive mar-
Guidelines
keting practices (sections 74.01 through 74.06), refusal to deal (section 75), price
maintenance (section 76), exclusive dealing, tied selling and market restriction
(section 77), abuse of a dominant position (sections 78 and 79), anti-competitive
agreements or arrangements between competitors (other than “hard core” cartels)
(section 90.1), and mergers (section 92).8
4 For certain types of conduct, such as price-fixing conspiracies, the creation of market
power and the harm to competition is presumed from the conduct.
5 In its Nova Scotia Pharmaceutical Society judgement, the Supreme Court defines market
power as “the ability to behave relatively independently of the market.” In the NutraSweet
Co. decision, the Competition Tribunal defines market power as the ability to maintain
prices above competitive levels for a considerable period.
6 In the abuse of dominance provision of the Act, subsection 79(4) provides that superior
competitive performance is a consideration in determining whether a practice has an anti-
competitive effect in a market.
7 The refusal to deal provision (section 75) and the price maintenance provision (section 76)
require proof that the conduct is having or is likely to have an adverse effect on competition
in a market. Section 75 also requires that the person’s inability to obtain adequate supply is
the result of insufficient competition among suppliers. The deceptive marketing practices
provisions (sections 74.01 through 74.06) do not include a competitive effects requirement.
8 Section 103.1 of the Act allows parties to apply to the Tribunal for leave to make an
application under section 75, 76 or 77.
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23. When a court determines that a firm has contravened the criminal provisions of
the Act, it can impose fines, imprisonment and prohibition orders.9 In addition,
parties may bring private actions seeking damages.10 With respect to reviewable
matters, the Tribunal may issue a variety of remedial orders, some of which restrict
private property rights. For example, the Tribunal has, in the past, ordered merging
firms to divest themselves of assets, including IP, when it concluded that the pro-
posed merger was likely to substantially lessen or prevent competition, thereby
overriding the rights of property owners to acquire or dispose of their private pro-
perty.11 Similarly, remedies under the abuse of dominant position provision have
involved orders affecting IP.12
24. Section 32, which is in the special remedies part of the Act, gives the Federal
Court the power, on application by the Attorney General, to make remedial orders
if it finds that a company has used the exclusive rights and privileges conferred by
a patent, trademark, copyright or registered integrated circuit topography to unduly
restrain trade or lessen competition (see subsection 4.2 of these Guidelines for cir-
cumstances in which the Bureau may seek to have the Attorney General bring an
application under section 32).
25. When the Federal Court determines that a special remedy is warranted under
section 32, it may issue a remedial order declaring any agreement or licence relat-
ing to the anti-competitive use void, requiring the licensing of the IP right (except
in the case of trademarks), revoking the IP right or directing that other things be
done to prevent anti-competitive use. This provision provides the Attorney General
with the statutory authority to intervene in a broad range of circumstances to rem-
edy an undue lessening or prevention of competition involving the exercise of stat-
utory IP rights. In practice, the Attorney General likely would seek a remedial order
under the Act only on the recommendation of the Commissioner.
3. — Interface between IP and Competition Law

3.1 — Property Rights
26. Private property rights are the foundation of a market economy. Property own-
ers must be allowed to profit from the creation and use of their property by claim-
ing the rewards flowing from it. In a market system, this is accomplished by grant-
ing owners the right to exclude others from using their property, and forcing those
wishing to use it to negotiate or bargain in the marketplace for it, thereby rewarding
the owner. This creates incentives to invest in developing, and leads to the ex-
change of, private property, thus contributing to the efficient operation of markets.
9 See the Bureau’s Competition and Compliance Framework Bulletin for a detailed discus-
sion of case resolution alternatives.
10 See section 36 of the Act.
11 See the Competition Tribunal’s divestiture order in Southam Inc.
12 See the Competition Tribunal’s divestiture order in Nielsen.
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3.2 — IP Law
27. IP has unique characteristics that make it difficult for owners to physically re-
strict access to it and, therefore, exercise their rights over it. The owner of physical
property can protect against its unauthorized use by taking appropriate security
measures, such as locking it away, but it is difficult, if not impossible, for the crea-
tor of a work of art or an invention to prevent his or her property from being copied
once it has been shown or distributed. This is exacerbated because IP, while often
expensive to develop, is often easy and inexpensive to copy. IP is also typically
non-rivalrous — that is, two or more people can simultaneously use IP. The fact
that a firm is using a novel production process does not prevent another firm from
simultaneously using the same process. In contrast, the use of a physical property
by one firm prevents concurrent use by another13
28. Accordingly, IP laws confer on an IP owner the right to unilaterally exclude
others from using that property. While each IP-related statute grants this right to
varying degrees, and the right may be subject to limitations that vary across stat-
utes, all of the statutes position the owners of the IP to maximize the IP’s value
through trade and exchange in the marketplace. This claim on the rewards flowing
from IP enhances the incentive for investment and future innovation in IP, just as it
does for other forms of private property. With the exception of the protections af-
forded unregistered trademarks and other common law rights, the legal protection
of IP is a function of, and does not exist outside the scope of, IP statutory regimes.
Guidelines
3.3 — Competition Law
29. Since the right to exclude, which is the basis of private property rights, is neces-
sary for efficient, competitive markets, the enforcement of the Act rarely interferes
with the exercise of this basic right. Enforcement action under the Act nonetheless
may be warranted when there are conspiracies, agreements or arrangements among
competitors or potential competitors; when anti-competitive conduct creates, en-
hances or maintains market power;14 or when firms use deceptive marketing
practices.
13 To enforce common law property rights, it must be possible to identify the property’s
owner and to clearly delineate the boundaries of the property. Both tasks can prove problem-
atic in the case of IP. For other kinds of private property, possession can generally be seen as
an indication of ownership. However, since many individuals can possess IP simultaneously,
it may be difficult to establish the identity of the original creator and true owner of the IP.
Furthermore, since IP is generally intangible, it is often difficult to clearly delineate the
boundaries of the property. Without a legal delineation of these boundaries, IP owners may
have difficulty showing that others have infringed their property.
14 An example of conduct involving IP that could create market power is the assignment of
patents Such conduct was an issue in the case of Apotex Inc. v. Eli Lilly and Co.
919
3.4 — Interface
30. IP and competition laws are both necessary for the efficient operation of the
marketplace. IP laws provide property rights comparable to those for other kinds of
private property, thereby providing incentives for owners to invest in creating and
developing IP and encouraging the efficient use and dissemination of the property
within the marketplace. Applying the Act to conduct associated with IP may pre-
vent anti-competitive conduct that impedes the efficient production and diffusion of
goods and technologies and the creation of new products. The promotion of a com-
petitive marketplace through the application of competition laws is consistent with
the objectives underlying IP laws.
4. — Applying the Act to Conduct Involving IP

4.1 — Overview of Competition Harm Analysis
31. In general, the Bureau’s analysis for determining whether competitive harm
would result15 from a particular type of business conduct comprises five steps:
1. Identifying the conduct;16
2. Defining the relevant market(s);17
3. Determining if the firm or firms under scrutiny possess market power18 by
examining the level of concentration and entry conditions in the relevant mar-
ket(s), as well as other factors;
4. Determining if the conduct would substantially lessen or prevent competi-
tion in the relevant market(s); and
5. Considering, when appropriate, any relevant efficiency rationales or valid
business justifications.
32. This analysis applies to all industries and all types of business conduct, and is
sufficiently flexible to accommodate differences among the many forms of IP pro-
tection, as well as between IP and other types of property. For example, the Bureau
takes differences among the various forms of IP protection into account when de-
fining the relevant market and determining whether a firm has market power. In
15 For ease of discussion, unless otherwise indicated, the Guidelines focus on prospective
competitive harm. Note, however, that in many cases, competitive harm may be occurring at
the time the Bureau is conducting an investigation or may have occurred at some point in the
past.
16 Some examples of conduct that could involve IP include mergers, pooling of licences,
setting standards for products, tied selling and exclusive dealing.
17 Defining relevant markets is a widely used and accepted tool for assessing competitive
effects. While the Bureau seeks to define relevant markets as part of its analysis in most
investigations, relevant market definition is not necessarily an initial step in the Bureau’s
analysis, and it may not be a required step in certain cases.
18 Matters pursued under the criminal provisions or the deceptive marketing practices provi-
sions do not require a finding of market power or an identification of competitive effects.
920
addition, although IP rights to a particular product or process are often created and
protected by statute and are thus different from other forms of property rights, the
right to exclude others from using the product or process does not necessarily grant
the owner market power. After it has defined the relevant market and examined
factors, such as concentration, entry barriers and technological change, the Bureau
can determine whether an owner of a valid IP right possesses market power. The
existence of a variety of effective substitutes for the IP and/or a high probability of
entry by other players into the market (by “innovating around” or “leap-frogging
over” any apparently entrenched position) would likely cause the Bureau to con-
clude that the IP has not conferred market power on its owner.
33. While the criminal offence provisions of the Act do not require a finding of
market power, under many reviewable matters provisions an order can only be
made if a firm has engaged in anti-competitive conduct that creates, enhances or
maintains market power. Again, consistent with its approach with respect to all
forms of property, the Bureau does not consider an owner of IP to have contra-
vened the Act if it attained market power solely by possessing a superior-quality
product or process, introducing an innovative business practice or otherwise
through exceptional performance.
34. Licensing is the usual method by which the owner of IP authorizes others to use
it. In the vast majority of cases, licensing is pro-competitive because it facilitates
the broader use of a valuable IP right by additional parties.19 In assessing whether a
Guidelines
particular licensing arrangement raises a competition issue, the Bureau examines
whether the terms of the licence serve to create, enhance or maintain the market
power of either the licensor or the licensee.20 The Bureau will not consider licens-
ing agreements involving IP to be anti-competitive unless they reduce competition
substantially relative to that which would have likely existed in the absence of the
licence’s potentially anti-competitive terms.
4.2 — Enforcement Principles

35. Specific reference is made to IP rights in a number of provisions of the Act.21
The circumstances in which the Bureau may apply the Act to anti-competitive con-
duct involving IP or IP rights fall into two broad categories: those involving anti-
competitive conduct that is something more than the mere exercise of the IP right,
and those involving the mere exercise of the IP right and nothing else. The general
provisions of the Act address the former, while section 32 (special remedies) ad-
19 Licensing is a means by which owners trade IP, and it signals the willingness of IP hold-
ers to participate in the marketplace. This ability of owners to exchange and transfer IP can
enhance the IP’s value and increase the incentive for its creation and use. Licensing arrange-
ments also promote the efficient use of IP by facilitating its integration with other compo-
nents of production, such as manufacturing and distribution.
20 This is the case when the Bureau is assessing a licensing arrangement outside the criminal
provisions.
21 Refer to sections 32, 76, 77, 79 and 86.
921
dresses the latter. The Bureau’s approach is consistent with subsection 79(5), which
acknowledges that the mere exercise of an IP right is not an anti-competitive act for
the purposes of the abuse of dominance provision,22 while acknowledging the pos-
sibility that under the very rare circumstances set out in section 32, the mere exer-
cise of an IP right might raise a competition issue.23
4.2.1 — General Provisions

36. The mere exercise of an IP right is not cause for concern under the general
provisions of the Act. The Bureau defines the mere exercise of an IP right as the
exercise of the owner’s right to unilaterally exclude others from using the IP. The
Bureau views an IP owner’s use or non-use of the IP also as being the mere exer-
cise of an IP right.24
37. Unilaterally exercising the IP right to exclude does not violate the general pro-
visions of the Act no matter to what degree competition is affected. To hold other-
wise could effectively nullify IP rights, impair or remove the economic, cultural,
social and educational benefits created by them, and be inconsistent with the Bu-
reau’s underlying view that IP and competition law are generally complementary.
38. The Bureau applies the general provisions of the Act when IP rights form the
basis of agreements or arrangements between independent entities, whether in the
form of a transfer, licensing arrangement or agreement to use or enforce IP rights,
and when the alleged competitive harm stems from such an agreement or arrange-
ment and not just from the mere exercise of the IP right and nothing else.
39. Applying the Act in this way may limit to whom and how the IP owner may
license, transfer or sell the IP, but it does not challenge the fundamental right of the
IP holder to do so. If an IP owner licenses, transfers or sells the IP to a firm or a
group of firms that would have been actual or potential competitors without the
arrangement, and if this arrangement creates, enhances or maintains market power,
the Bureau may seek to challenge the arrangement under the appropriate section of
the Act.25 Part 7 of this document provides a series of hypothetical examples to
illustrate how the Bureau would examine the licensing, transfer or sale of IP under
the Act.
22 Subsection 79(5) reads: “For the purpose of this section, an act engaged in pursuant only
to the exercise of any right or enjoyment of any interest derived under the Copyright Act,
Industrial Design Act, Integrated Circuit Topography Act, Patent Act, Trade-marks Act or
any other Act of Parliament pertaining to intellectual or industrial property is not an anti-
competitive act.”
23 The remedies in section 32 are more extensive than those under the general provisions.
24 However, as noted in Example 9A, there may be limited circumstances where non-use of
an IP right may be seen as something more than the “mere exercise” of an IP right, and
therefore could potentially raise issues under the general provisions of the Act.
25 This analysis would use the concept of a relevant market as discussed in section 5.1. For
an example where an assignment of patent rights may create market power, see Apotex Inc.
v. Eli Lilly and Co.
922
40. This approach is consistent with the Tribunal’s decisions in Tele-Direct,

Warner, and TREB. In Warner the Tribunal held that the mere exercise of the IP
right to refuse to license to a complainant did not contravene the general provisions
of the Act.26 In its decision in Tele-Direct, the Tribunal indicated that competitive
harm must stem from something more than just the mere refusal to license.27 In
TREB the Tribunal held that where a respondent attaches anti-competitive condi-
tions to the use of its IP, subsection 79(5) will not immunize it from scrutiny.
41. TREB was upheld in a decision by the Federal Court of Appeal (“FCA”). The
FCA noted that subsection 79(5) does not state that any assertion of intellectual
property right shields what would otherwise be an anti-competitive act. The FCA
also noted that Parliament intended to insulate intellectual property rights from alle-
gations of anti-competitive conduct where the IP right is the sole purpose of exer-
cise or use. Finally, the Court held that because the conditions TREB imposed on
its copyright licenses were anti-competitive, it could not rely on copyright as a de-
fence pursuant to subsection 79(5).
42. Underlying this enforcement approach is the view that market conditions and
the differential advantages IP provides should largely determine commercial re-
wards flowing from the exploitation of an IP right in the market to which it relates.
If a company uses IP protection to engage in conduct that creates, enhances or
maintains market power as proscribed by the Act, then the Bureau may intervene.
43. When joint conduct of two or more firms lessens or prevents competition, the
Guidelines
competitive harm generally flows from something more than the mere exercise of
the IP right to refuse. To the extent that conduct, such as joint abuse of dominance
or mergers, restricts competition among firms, the presence of IP should not be a
mitigating factor. Similarly, the presence of IP should not be an exception or miti-
gating factor in matters involving criminal conduct, such as conspiracy28 or bid-
rigging. All these types of conduct involving IP could be subject to review under
the appropriate general provision of the Act.
44. A transfer of IP rights that lessens or prevents competition is a further example
of a situation in which competitive harm results from something more than the
mere exercise of the IP right to exclude. Two examples of this are when a licensor
26 It may be possible to review certain refusals to license under the Act’s price maintenance
provision (section 76). See the decision in Stargrove Entertainment Inc. v. Universal Music
Publishing Group Canada et al., where the Tribunal granted leave to an applicant to make
an application under section 76 in respect of an alleged discriminatory refusal to license IP
rights.
27 In Tele-Direct, the Tribunal stated that, “[it] is in agreement with the Director that there
may be instances where a trademark may be misused. However in the Tribunal’s view,
something more than the mere exercise of statutory rights, even if exclusionary in effect,
must be present before there can be a finding of misuse of a trademark.”
28 The Copyright Act provides that section 45 of the Act does not apply to any royalties or
related terms and conditions arising under certain collective society agreements filed with
the Copyright Board.
923
ties a non-proprietary product to a product covered by its IP right, and when a firm
effectively extends its market power beyond the term of its patent through an exclu-
sive contract. In either case, if the conduct leads to the creation, enhancement or
maintenance of market power so as to substantially lessen or prevent competition,
the Bureau may intervene.
45. Sometimes upon examination, what appears to be just a refusal to license or to
grant others access to a firm’s IP rights turns out to have included conduct that goes
beyond such a refusal. Conduct that goes beyond the unilateral refusal to grant ac-
cess to the IP could warrant enforcement action under the general provisions of the
Act. For instance, if a firm acquires market power by systematically purchasing a
controlling collection of IP rights and then refuses to license the rights to others,
and it substantially lessens or prevents competition in markets associated with the
IP rights, the Bureau could view the acquisition of such rights as anti-competitive.
If the conduct met the definition of a merger as specified in section 91 of the Act,
the Bureau would review the acquisitions under the merger provisions. If the con-
duct did not meet the definition of a merger, the Bureau would review the matter
under either section 79 (abuse of dominance) or section 90.1 (agreements between
competitors) of the Act.29 Without the acquisitions, the owner’s mere refusal to
license the IP rights would have been unlikely to cause concern.
4.2.2 — Matters Outside the General Provisions — Section 3230

46. Only section 32, in the special remedies part of the Act, contemplates the possi-
bility that the mere exercise of an IP right may cause concern and result in the
Bureau seeking to have the Attorney General bring an application for a special rem-
edy to the Federal Court. Section 32 has rarely been used.31
47. The Bureau will seek a remedy for the unilateral exercise of the IP right to
exclude under section 32 only if the circumstances specified in that section are met
and the alleged competitive harm stems directly from the refusal and nothing else.
Such circumstances require the Federal Court to balance the interests of the system
of protection for IP (and the incentives created by it) against the public interest in
greater competition in the particular market under consideration. Generally, the Bu-
29 The Tribunal recognized in Laidlaw that the abuse of dominance provision could apply to
situations involving a series of acquisitions.
30 The special remedies provided for under section 32 include declaring any agreement or
licence relating to the challenged right void, ordering licensing of the right (except in the
case of trademarks), revoking a patent, expunging or amending a trademark, or directing that
other such acts be done or omitted as deemed necessary to prevent the challenged use.
31 Informations have only been laid in two cases under section 32 and in both cases the
disputes were settled before proceeding to full hearings. See R. v. Union Carbide of Canada
Limited (December 9, 1969) and R. v. Union Carbide of Canada Limited (June 19, 1971).
Since these two cases the Bureau has never recommended that the Attorney General bring an
application for a special remedy under section 32 and there has never been a remedial order
granted pursuant to that section.
924
reau would recommend to the Attorney General that an application be made to the
Federal Court under section 32 when, in the Bureau’s view, no appropriate remedy
is available under the relevant IP statute.
48. Enforcement under section 32 requires proof that competition has been unduly
restrained, prevented or lessened. The Bureau expects that such enforcement action
would be required only in certain narrowly defined circumstances. The Bureau de-
termines whether the exercise of an IP right meets this threshold by analyzing the
situation in two steps.
49. In the first step, the Bureau would establish that the mere refusal (typically the
refusal to license IP) has adversely affected competition to a degree that would be
considered substantial in a relevant market that is different or significantly larger
than the subject matter of the IP or the products or services that result directly from
the exercise of the IP. This step is satisfied only by the combination of the follow-
ing factors:
1. The holder of the IP is dominant in the relevant market; and
2. The IP is an essential input or resource for firms participating in the relevant
market — that is, the refusal to allow others to use the IP prevents other firms
from effectively competing in the relevant market.
50. In the second step, the Bureau would establish that invoking a special remedy
against the IP right holder would not materially alter the incentives of the right
Guidelines
holder or others to engage or invest in research and development. As part of this
analysis, the Bureau would consider whether the refusal to license the IP is stifling
further innovation.
51. If factors i) and ii) are present and the second step condition is satisfied, then
the Bureau would conclude that incentives to invest in research and development
have been harmed by the refusal and a special remedy would help realign these
incentives with the public interest in greater competition.
52. The Bureau recognizes that only in very rare circumstances would each of the
factors be satisfied. In particular, the Bureau expects that in most cases a section 32
remedy is likely to undermine innovation incentives. Nonetheless, an example in
which each of the factors could arise is in a network industry,32 when the combina-
tion of IP protection and substantial positive effects associated with the size of the
network could create or entrench substantial market dominance so that the pro-
tected technology is necessary for a competitor’s products to be viable alternatives.
Under these narrow circumstances, IP protection can effectively exclude others
32 A network industry is an industry that exhibits network effects. These effects exist when
the value or benefit derived from using a product increases with the number of other users.
For example, particular types of software can exhibit network effects because the value of
exchanging computer files with other individuals clearly depends on whether these individu-
als use compatible software.
925
from entering and producing in the market.33 However, the Bureau still would have
to be satisfied that invoking a special remedy against the IP right holder would not
materially alter the incentives of the right holder or others to engage or invest in
research and development before recommending that the Attorney General bring an
application for a special remedy to the Federal Court (see Example 8).
4.2.3 — Matters Possibly Resolved Outside the Act

53. An illegitimate extension of an IP right could include anti-competitive beha-
viour. This might involve a patent holder asserting its patent over products that are
not within the scope of its patent or a distributor making false claims that it is an
official licensee of a trademarked good. Alternatively, the Bureau may receive
complaints that infringement of a legitimate IP right should be justified on competi-
tion grounds. In such disputes, the Bureau will use its enforcement discretion but in
most cases it will choose to leave the matter to be resolved by the appropriate IP
authority under the appropriate IP statute (see Example 1).
54. As outlined in section 4.1 above, the Bureau’s analytical approach is suffi-
ciently flexible to accommodate the specific characteristics of IP and the differ-
ences in the scope and length of protection extended to different IP rights. The
following information highlights how the Bureau takes these factors into account
when analyzing business conduct involving IP.
5. — The Analytical Framework in the Context of IP

5.1 — Relevant Markets
55. Relevant markets provide a practical tool for assessing market power.34 When
the anti-competitive concern is prospective (that is, the conduct is likely to have a
future anti-competitive effect),35 relevant markets are normally defined using the
hypothetical monopolist test.36
56. When the anti-competitive concern is retrospective37 (that is, the conduct has
already had an anti-competitive effect), applying the hypothetical monopolist test
could lead to erroneous conclusions about the availability of substitutes and the
33 This does not suggest that markets subject to network effects will inevitably be monopo-
lized. Often, firms form alliances and make a new technology “open” to gain acceptance and
build an installed base. These activities tend to be pro-competitive if firms that participate in
the process freely compete with each other in the market.
34 The market definition exercise focuses on demand substitution factors (i.e., possible con-
sumer responses). The Bureau considers the potential constraining influence of firms that
can participate in the market through a supply response (i.e., a possible production response)
after it has defined the relevant market.
35 This is generally the case with mergers.
36 See paragraphs 4.3, 4.4 and 4.5 of the Bureau’s Merger Enforcement Guidelines, October
2011.
37 This is generally the case with alleged abuse of dominant position.
926
presence of market power. Accordingly, the Bureau takes into account the impact
of any alleged anti-competitive conduct that may have preceded the investigation
when determining the relevant market. In this context, the Bureau analyzes market
definition and competitive effects concurrently.
57. For conduct involving IP, the Bureau is likely to define the relevant market
based on one of the following: the intangible knowledge or know-how that consti-
tutes the IP, processes that are based on the IP rights, or the final or intermediate
goods resulting from, or incorporating, the IP.
58. Defining a market around intangible knowledge or know-how is likely to be
important when IP rights are separate from any technology or product in which the
knowledge or know-how is used. For example, consider a merger between two
firms that individually license similar patents to various independent firms that, in
turn, use the patents to develop their own process technologies. Such a merger may
reduce competition in the relevant market for the patented know-how if the two
versions of that know-how are close substitutes for each other; if there are no (or
very few) alternatives that are close substitutes for the know-how; and if there are
barriers that would effectively deter the development of conceptual approaches that
could replace the know-how of the merging firms. This last condition may be satis-
fied if the scope of the patents protecting the merging firms’ know-how is suffi-
ciently broad to prevent others from “innovating around” the patented technologies,
or if the development of such know-how requires specialized knowledge or assets
Guidelines
that potential competitors would be unlikely to develop or obtain in a timely man-
ner sufficient to constrain a material price increase in the relevant market.
59. In cases involving the licensing of IP, the Bureau generally treats the licence as
the terms of trade under which the licensee is entitled to use the IP. The Bureau
does not define a relevant market around a licence, but rather focuses on what the
legal rights granted to the licensee actually protect (i.e., intangible knowledge or
know-how, processes, or final or intermediate goods).
60. The Bureau does not define markets based on research and development activ-
ity or innovation efforts alone. The Bureau usually concentrates on price or output
effects. However, conduct that reduces the innovation effort of the firms under
scrutiny or restricts or prevents the innovation efforts of others may be anti-com-
petitive. The appropriate relevant market definition or definitions will depend spe-
cifically on the knowledge or know-how, process, or, final or intermediate good
toward which the innovation effort is directed.
5.2 — Market Power

61. Whether conduct involving IP results in an increase in market power in the
relevant market depends on a number of factors, including the level of concentra-
tion, entry conditions, the rate of technological change, the ability of firms to “leap-
frog over” seemingly entrenched positions and the horizontal effects, if any, on the
927
market.38 The order in which the Bureau assesses these factors may vary depending
on the section of the Act under which the Bureau is examining the conduct and on
the circumstances of the relevant market.
5.2.1 — Market Concentration

62. The Bureau examines the degree of market concentration to get a preliminary
indication of the competitiveness of the relevant market. In general, the more firms
in the relevant market, the less likely it is that any one firm acting unilaterally, or
any group of firms acting cooperatively, could enhance or maintain market power
through the conduct being examined. However, a high degree of concentration is
not enough to justify the conclusion that the conduct will create, enhance or main-
tain market power. This is particularly true of industries with low barriers to entry,
a high rate of technological change and a pattern of firms “innovating around” or
“leap-frogging over” technologies that had previously controlled a dominant share
of a market.
63. To measure concentration in markets for intermediate or final goods, the Bu-
reau typically calculates the market shares of the firms identified as actual partici-
pants in the relevant market. These include the firms identified as currently offering
products that are demand substitutes as well as those that represent potential supply
sources of these products (i.e., firms that are likely to respond to a price increase in
the relevant market with minimal investment).39 Firms that are unable to respond
quickly to a price increase or whose entry requires significant investment are not
considered to be participants within the relevant market for purposes of assessing
market concentration. That said, the potential competitive influence of such firms
will be considered as part of the assessment of whether the conduct in question is
likely to lessen or prevent competition substantially.
64. The Bureau generally does not challenge the conduct of a firm that possesses
less than a 35 percent market share.40 Market shares of more than 35 percent indi-
cate circumstances that may warrant further review. Market share may be calcu-
lated based on the firms’ entire actual output, total sales (dollars or units) or total
38 The Merger Enforcement Guidelines discuss other factors the Bureau considers when it
assesses market power. These include foreign competition, business failure and exit, the
availability of acceptable substitutes, effective remaining competition, removal of a vigorous
and effective competitor, and change and innovation.
39 The following factors are relevant to determining when a firm will rapidly divert sales in
response to a price increase: the cost of substituting production in the relevant market for
current production (i.e., switching costs), the extent to which the firm is committed to pro-
ducing other products or services, and the profitability of switching from current production.
40 The Bureau generally does not challenge the conduct of a group of firms alleged to be
jointly dominant that possess a combined market share of less than 65 percent.
928
capacity (used and unused).41,42 However, some of these factors may be difficult to
assess in cases involving IP. Accordingly, the Bureau’s assessment of market
power is likely to focus on qualitative factors, such as conditions of entry into the
relevant market; whether IP development is resulting in a rapid pace of technologi-
cal change; and the views of buyers and market participants, as well as industry and
technology experts.
5.2.2 — Ease of Entry

65. The Bureau also examines how easily firms can enter the relevant market to
determine whether new entrants have the ability to restrain any creation, enhance-
ment or maintenance of market power that may result from conduct involving IP.
When assessing effects in markets involving IP, conditions of entry are often more
important than market concentration. For instance, evidence of a rapid pace of tech-
nological change and of the prospect of firms being able to “innovate around” or
“leap-frog over” an apparently entrenched position is an important consideration
that may, in many cases, fully address potential competition concerns.
66. The Bureau also considers the extent to which the conduct itself erects or has
erected barriers to entry or, alternatively, induces or has induced competitors to exit
the market (see Examples 3B and 4).43 Entry into markets in which IP is important
may be difficult because of the sunk costs associated with developing assets that
comprise specialized knowledge. Additionally, IP rights can serve to increase barri-
Guidelines
ers to entry independent of any conduct.44
5.2.3 — Horizontal Effects

67. In evaluating the competitive effects of conduct that involves an IP right,
whether it is a merger transaction, licensing arrangement or other form of contrac-
tual arrangement, the Bureau focuses on whether the conduct will result in horizon-
tal anti-competitive effects, in other words, consequences for firms producing sub-
stitutes or firms potentially producing substitutes (see Examples 3A and 3B).
68. Even though an arrangement may be vertical, such as the acquisition of a retail
shoe outlet by a shoe manufacturer or the licensing of the right to use a particular
41 If the actual participants in the market include firms that represent potential sources of
supply for the market, then market shares, even in terms of production capacities, may be
difficult to accurately estimate. Accordingly, it must be recognized that the market shares
attributed to firms whose products are actually sold within the relevant market will overstate
the relative market position of these firms in such circumstances.
42 The Tribunal stated in Laidlaw that market share calculations based on sales may over-
state market power when the market is characterized by excess capacity.
43 The fact that anti-competitive conduct can create barriers to entry was recognized by the
Tribunal in Laidlaw.
44 Of course, the purpose of providing innovators with IP rights is to foster the development
of new products. In this sense, IP rights may encourage firms to participate in environments
in which technology changes very rapidly.
929
food additive to a food producer, it can still have horizontal effects in a relevant
market (see Example 4).
5.3 — Anti-competitive Effects

69. Conduct must create horizontal effects for the Bureau to conclude that it is anti-
competitive.45 In this regard, the Bureau analyzes whether conduct facilitates a
firm’s ability to exercise market power, either unilaterally or in a coordinated man-
ner, in areas such as pricing and output.46
70. Anti-competitive horizontal effects may arise if the conduct increases competi-
tors’ costs. For example, a transaction can prevent, or raise the cost of, competitors’
access to important inputs. IP licensing arrangements that involve one firm selling
the right to use IP to another are inherently vertical, but can have horizontal effects,
particularly if the licensor and licensee would have been actual competitors in the
absence of the licensing arrangement. In addition, conduct that reduces innovation
activity could be anti-competitive if it prevents future competition in a prospective
product or process market.
5.4 — Efficiency Considerations

71. A fundamental objective of competition law is to ensure the efficient use of
resources through vigorous competition. However, there may be instances in which
restrictions on competition can lead to a more efficient use of resources. This may
be particularly true of agreements, arrangements and transactions involving IP that
are inherently vertical and combine complementary factors. Moreover, there may
be instances when creating or increasing market power is justified because of the
efficiencies created. Indeed, this principle is consistent with the protection afforded
by IP laws, which foster dynamic efficiency and competition by facilitating the
creation of valuable works or processes that result in long-term increases in product
selection, quality, output and productivity. In providing incentives for investment,
IP laws grant exclusivity to the protected works that may result in temporary mar-
ket power. Consequently, the Bureau considers both the short-term and long-term
implications of conduct when analyzing efficiencies in cases involving IP. Efficien-
cies are explicitly recognized in sections 90.1 and 96 of the Act in the context of
agreements or arrangements among competitors47 and mergers.48
45 For investigations under provisions of the Act that do not require a showing that the
conduct has an effect on competition, there is no need to consider anti-competitive effects
(see Example 10).
46 The term “pricing” includes all aspects of firms’ actions that affect the interest of buyers.
These include a reduction in quality, product choice, service, innovation or other dimensions
of competition that buyers value.
47 Section 90.1 also applies to agreements between parties that are potential competitors.
48 Section 95 provides a specific exemption under the merger provision for research and
development joint ventures that satisfy certain criteria outlined in the provision.
930
72. If the Bureau concludes that conduct is likely to substantially lessen or prevent
competition in a relevant market under either section 90.1 or 92 of the Act, it will,
when provided in a timely manner with the parties’ evidence substantiating their
case, make an assessment of whether the efficiency gains brought about or likely to
be brought about by the conduct are greater than and offset the anti-competitive
effects arising from the conduct. Part 12 of the Merger Enforcement Guidelines
more fully describes the Bureau’s approach to the analysis of efficiencies.
5.5 — Business Justifications

73. In assessing whether conduct involving IP is for an anti-competitive purpose
under section 79 of the Act, the Bureau considers any pro-competitive rationale for
the conduct.49 For example, a licensing arrangement between an IP owner and a
distributor may restrict intra-brand competition, but at the same time further inter-
brand competition. A licensing arrangement between two potential competitors also
may result in a new product being developed that would not otherwise have been
developed. In each case, the level of competition in the market may be enhanced.50
6. — Competition Policy Advocacy

74. The Bureau may use its mandate to promote competition and the efficient allo-
cation of resources to intervene in policy discussions and debates regarding the
appropriate scope, definition, breadth or length of IP rights.51 The Bureau may also
Guidelines
seek leave to intervene in Federal Court and Superior Court cases when it believes
it is important to bring a competition perspective to proceedings that will not be
brought by the parties. In other proceedings, when the Bureau believes that IP
rights could potentially be defined, strengthened or extended inappropriately, the
Bureau may seek leave to intervene to make representations concerning the scope
of the protection that should be accorded IP rights.
75. An example of Bureau advocacy occurred when it applied for and was granted
leave to intervene in Apotex Inc. v. Eli Lilly and Co. In this case, the Bureau argued
49 In Tele-Direct the Competition Tribunal stated that, “(w)hat the Tribunal must decide is
whether, once all relevant factors have been taken into account and weighed, the act in ques-
tion is, on balance, ‘exclusionary, predatory or disciplinary’. Relevant factors include evi-
dence of the effects of the act, of any business justification and of subjective intent which,
while not necessary, may be informative in assessing the totality of the evidence. A ‘business
justification’ must be a ‘credible efficiency or pro-competitive’ business justification for the
act in issue. Further, the business justification must be weighed ‘in light of any anti-competi-
tive effects to establish the overriding purpose’ of the challenged act . . .”
50 In Nielsen the Competition Tribunal held that even if there is some justification for the
alleged anti-competitive conduct, this must be weighed against any anti-competitive effects.
51 Section 125 of the Act provides that the Commissioner may make representations to and
call evidence before any federal board, commission or other tribunal in respect of competi-
tion. Section 126 of the Act provides that the Commissioner may do the same for any pro-
vincial board, commission or other tribunal as long as the board, commission or tribunal
consents.
931
that the assignment of a patent could constitute an agreement or arrangement to

unduly lessen competition contrary to the former section 45 of the Act. This posi-
tion meant that section 50 of the Patent Act, which gives patentees the right to
assign their patents, does not preclude application of the Act to patent assignments.
The Bureau’s intervention served the purpose of protecting its ability to administer
the Act in respect of patent rights. The FCA agreed with the Bureau’s position and
noted that “this interpretation is consistent with the Competition Bureau’s Intellec-
tual Property Enforcement Guidelines”.
7. — Application of Competition Law to IP

7.1 — Hypothetical Examples Concerning General Business Conduct
Involving IP
76. This subsection provides several hypothetical examples of general business
conduct involving IP and outlines the Bureau’s approach to reviewing the conduct
under the Act.
Example 1: — Alleged Infringement of an IP Right

77. TAX is a software company that produces and distributes a sophisticated and
complex tax management program to help households with their tax planning. TAX
has been selling its product for a number of years and is now widely recognized as
a leading producer of tax management software.
78. More than two years ago, a key member of TAX’s software engineering team
left the company to start her own software business, called UPSTART. Recently,
UPSTART began to market its own tax management program. TAX has sued UP-
START claiming that UPSTART must have infringed TAX’s copyright because its
software is very similar in appearance and functionality to TAX’s software. UP-
START has complained to the Bureau that TAX is abusing its dominant position by
launching frivolous litigation.
Analysis
79. The Bureau would use its enforcement discretion and likely conclude that this
matter would be best left up to the courts to be resolved under the Copyright Act. If
TAX engages in a practice of launching frivolous litigation to exclude competitors,
the Bureau may consider taking action under section 79 of the Act.
Example 2: — Price-fixing
80. Three firms, each of which has developed and owns a patented technique, offer
competing cosmetic surgical procedures to treat a particular condition. All three
procedures involve several visits to a private clinic over six months, produce no
side effects and have approximately equal success rates. The only existing alterna-
tive to the three procedures is an expensive medication that causes undesirable side
effects in some patients. Each of the three firms has developed a business plan to
market its procedure and industry analysts widely agree that competition among the
procedures will be the most important factor limiting shareholder returns. Rather
932
than proceed with their business plans in anticipated competition with one another,
the three firms agree on a minimum price at which each will perform the procedure
as well as a minimum fee to license each procedure to third parties.
Analysis
81. The Bureau would likely examine this agreement under the conspiracy provi-
sion in section 45 of the Act given that it involves fixing prices for the supply of a
product. The Bureau would likely take the view that the three participants in the
agreement are competitors based on the views of industry analysts and given the
fact that each of them supplies treatments that are functionally interchangeable with
and comparable to one another. For example, the duration, the success rate and the
risk of side effects are approximately the same for each procedure. Moreover, sec-
tion 45 applies to agreements between parties that are potential competitors. Ac-
cordingly, even if the parties had not been in competition when the agreement was
concluded or during the term of the agreement, the parties would still be deemed to
be competitors for purposes of section 45, as it would be reasonable to believe that
they would likely compete with respect to a product in the absence of the
conspiracy.
82. Given that the price-fixing agreement is not ancillary to a broader or separate
agreement or arrangement, which itself does not offend section 45, the Bureau
would refer the matter to the Director of Public Prosecutions (the “DPP”) for crimi-
Guidelines
nal prosecution.
Example 3A: — Exclusive Licensing

83. SHIFT recently developed a new gear system for mountain bikes. Two other
firms manufacture systems that compete with SHIFT’s. All three of these firms
manufacture several varieties of bicycle gear systems and are engaged in research
and development to improve gear system technology. SHIFT grants licences for the
use of its patented gear system technology to manufacturers of mountain bikes as it
does not have the ability to manufacture mountain bikes itself. Three large firms
account for 80 percent of the sales of mountain bikes with the balance being sup-
plied by six smaller firms. SHIFT has just granted ADVENTURE, the largest
mountain bike manufacturer (accounting for 30 percent of sales), an exclusive li-
cence to use its new patented gear system technology on its mountain bikes. AD-
VENTURE does not own or have the ability to develop gear system technology.
Although SHIFT’s new gear system offers a number of features not available on
other current products, the demand for mountain bikes with these new features is
uncertain. In addition, ADVENTURE expects to incur significant expense develop-
ing and promoting mountain bikes that use SHIFT’s new gear system technology.
SHIFT has refused requests from other mountain bike manufacturers for a licence
for this technology. As a result of ongoing research and development, alternative
gear system technologies are likely to become available in the future.
Analysis
933
84. The Bureau would likely examine the conduct of both firms under the abuse of
dominant position provision (section 79) of the Act.
85. SHIFT and ADVENTURE relate as supplier and customer, and are neither ac-
tual nor potential competitors in the markets for gear systems or mountain bikes.
Since the firms do not compete, the exclusive licence would likely not lessen com-
petition between the two firms. The Bureau would nonetheless examine the mar-
kets for gear systems and mountain bikes to determine if the exclusive licence less-
ened or prevented competition substantially in either or both of those markets.
86. Even though SHIFT’s new technology is not available to ADVENTURE’s ri-
vals and the markets for gear systems and mountain bikes are concentrated, the
other mountain bike manufacturers have access to other gear systems from SHIFT
and to gear systems from other suppliers. The exclusive licence may have been
granted in consideration for ADVENTURE’s agreement to incur significant ex-
pense in the development and promotion of mountain bikes that use SHIFT’s new
technology. In addition, SHIFT’s rivals in the gear system market may still sell to
ADVENTURE.
87. In the course of its assessment, the Bureau would consider the competitiveness
of the mountain bike market before and after the exclusive licence. SHIFT is not a
mountain bike manufacturer and has no obligation to license its gear system to a
mountain bike manufacturer. The technology licence mandated the development
and promotion of mountain bikes using the technology, thereby enhancing competi-
tion without in any way limiting the ability of other mountain bike manufacturers to
access or use competing technologies. Consequently, the Bureau would conclude,
given the facts of this case, that the exclusive licence arrangement did not raise any
competition issues.
Example 3B: — Foreclosure by Purchaser

88. Consider a variation on the situation described in Example 3A, in which AD-
VENTURE’s business has grown to represent approximately 70 percent of moun-
tain bike sales. ADVENTURE has taken advantage of its increasing sales share to
independently negotiate long-term exclusive licences and supply arrangements with
the three competing suppliers of mountain bike gear systems. The inability of the
competing manufacturers of mountain bikes to obtain suitable gear system technol-
ogy has put a number of them out of business and has substantially cut into the
sales of the remaining firms. ADVENTURE has raised the prices of its mountain
bikes by 25 percent. Although alternative gear system technologies are under de-
velopment, it appears unlikely that a viable technology will be tested and in pro-
duction in less than 36 months.
Analysis
89. The Bureau would likely examine ADVENTURE’s conduct under the abuse of
dominant position provision (section 79) of the Act.
90. The Bureau would initially determine whether mountain bikes comprised a rel-
evant market and assess whether ADVENTURE substantially or completely con-
934
trolled the supply of product within that relevant market. The Bureau would likely
view the apparent lack of effective substitutes and ADVENTURE’s high sales
share and ability to successfully impose a 25 percent price increase as evidence that
ADVENTURE substantially controlled the mountain bike business and that moun-
tain bikes comprise a relevant market.
91. The Bureau would then consider whether ADVENTURE’s exclusive licence
agreements, through which it precluded its competitors from obtaining an adequate
supply of gear systems, constituted anti-competitive conduct. While an exclusive
licence arrangement may enhance competition, as was apparent in Example 3A, the
use of an exclusive licence arrangement to effectively control the supply of a com-
petitively essential input may be anti-competitive. In the absence of a compelling
business justification, the Bureau would likely view the execution of long-term ex-
clusive licences with each of the suppliers as a practice of anti-competitive acts that
prevented ADVENTURE’s competitors from obtaining access to this vital input
(gear systems).
92. The Bureau would then assess the impact of the exclusive licences on competi-
tion. It would likely conclude that the adverse impact on the ability of other moun-
tain bike manufacturers to compete that resulted from ADVENTURE preventing
them from gaining access to proven gear system technology and the manner in
which ADVENTURE successfully imposed substantial price increases constituted
evidence that ADVENTURE substantially lessened or prevented competition. Ac-
Guidelines
cordingly, the Bureau would likely seek to have the exclusive licences voluntarily
terminated. Failing that, the Bureau would likely bring an application before the
Tribunal seeking to terminate the exclusive terms of the licences.
Example 4: — Exclusive Contracts

93. SPICE, by virtue of its international patents, is the sole supplier of Megasalt, a
unique food additive that has effectively replaced salt in certain prepared foods in
most countries. SPICE’s Canadian patent recently expired; however, SPICE still
has valid patent protection throughout much of the rest of the world. Shortly before
its Canadian patent expired, SPICE signed five-year contracts, which included ex-
clusive supply rights, with its two principal Canadian buyers. These contracts pre-
vent the two buyers, which use Megasalt in specially prepared foods for hospitals
and other health care institutions, from combining Megasalt with any other salt sub-
stitute on the same product line. SPICE does not have long-term exclusive supply
contracts with other buyers of Megasalt in Canada or elsewhere. Recently, NUsalt,
a firm that has developed a potential alternative to Megasalt, filed a complaint with
the Bureau alleging that SPICE’s contracts are preventing NUsalt from manufactur-
ing and marketing its product in Canada. NUsalt claims that SPICE’s contracts
have “locked up” a substantial part of the market, thereby precluding NUsalt from
profitably entering Canada.
Analysis
94. The NUsalt allegations suggest that SPICE, as a result of its contracts with its
two largest buyers, is currently exploiting market power within the market for salt
935
substitutes. The Bureau would likely investigate these allegations under the abuse
of dominance provision (section 79) of the Act.52
95. The Bureau would initially determine whether salt substitutes comprise a rele-
vant product market. This would entail determining whether salt substitutes are
subject to effective competition from other substances (for example, salt) or
whether salt substitutes have specific properties and functional characteristics that
make other substances ineffective as substitutes. The Bureau would then seek to
determine whether SPICE substantially controlled the market in which its salt sub-
stitute competed by assessing SPICE’s share of sales and barriers to entry to this
market. The Bureau would consider all of the factors currently preventing alterna-
tive suppliers of salt substitutes from offering their products to customers in Can-
ada, including the effect of SPICE’s exclusive supply contracts on the ability of
alternative suppliers to obtain sales from a critical mass of customers. Assuming
that the Bureau had determined that salt substitutes constitute a relevant market, it
would likely conclude that SPICE substantially controlled that market.
96. The Bureau would then consider whether the exclusive supply contracts,
through which SPICE had precluded its principal customers from obtaining salt
substitutes from alternative suppliers, constituted a practice of anti-competitive
acts. To make this assessment, the Bureau would examine the circumstances sur-
rounding the negotiation and settlement of the exclusive contracts, and the extent to
which they were exclusionary and intended to erect barriers to effective competi-
tion in the relevant market. As part of this analysis, the Bureau would consider
whether there are compelling business justifications for SPICE’s exclusive con-
tracts. For example, SPICE may have signed these contracts to ensure that it would
have sufficient sales to justify investing in enough productive capacity to realize
economies of scale. Also, the restriction preventing buyers from combining
Megasalt with other salt substitutes could have a safety or quality rationale. On the
other hand, if the Bureau found that the contracts in this case were intended to hold
back a sufficient amount of market demand from potential entrants so that the re-
maining demand would provide an insufficient volume of sales to cover the cost of
effective entry and future operating costs in Canada, then the Bureau would likely
view the execution of the long-term exclusive licences as a practice of anti-compet-
itive acts.
97. The Bureau would then assess the impact of the exclusive contracts on competi-
tion. In this regard, the adverse impact on the ability of other suppliers of salt sub-
stitutes to compete in Canada would be assessed to determine whether the contracts
had substantially lessened or prevented competition. If the relevant market is de-
fined as salt substitutes and SPICE’s contracts are significantly preventing the entry
of potential salt substitute producers, the Bureau may conclude that the exclusive
contracts have substantially lessened or prevented competition. By deterring firms
from attempting to supply alternative salt substitutes in Canada, the exclusive con-
52 The Bureau may also choose to review the conduct under the exclusive dealing, tied sell-
ing and market restriction provision (section 77) of the Act.
936
tracts may cause other buyers in Canada not under contract with SPICE to pay
higher prices than they would if SPICE faced effective competition.
98. The magnitude of the decrease in competition would depend on the extent to
which the contracts prevent entry and the expected degree of substitution that
would exist between Megasalt and alternative salt substitutes, such as NUsalt, in
the absence of the exclusive terms in the contracts. In general, if the contracts are
determined to be the principal barrier to new entry and the new entrants’ products
are likely to be close substitutes for Megasalt, then the Bureau is likely to conclude
that the contracts have substantially lessened or prevented competition and would
likely seek to have SPICE’s exclusive contracts voluntarily terminated. Failing that,
the Bureau would likely bring an application before the Tribunal seeking to termi-
nate the exclusive terms in the contracts.
99. However, if the Bureau determines that the contracts do not block effective
competitive entry in Canada, then SPICE’s exclusive contracts would not be con-
sidered to have substantially lessened or prevented competition. In this case the
Bureau would close its inquiry without seeking remedial measures. Throughout its
investigation the Bureau would work collaboratively with competition agencies in
other jurisdictions as necessary to determine facts and their analytical approach rel-
evant to the resolution of the matter.
Example 5: — Output Royalties
Guidelines
100. MEMEX currently holds a patent for the design of a memory component it
manufactures for use in personal home computers. MEMEX does not manufacture
personal computers, but instead sells its memory components and licenses the use
of its technology to computer manufacturers. Historically, MEMEX’s licensing
contracts required that the licensee pay a fee for each MEMEX memory component
it installed in a computer. Because of its patent, MEMEX currently faces no com-
petition from other memory component producers wishing to use a similar design;
however, MEMEX’s patent is due to expire within a year and there is speculation
that once it expires, other firms will begin manufacturing and selling memory com-
ponents based on MEMEX’s design. MEMEX has recently introduced a new li-
cence agreement. Under the new agreement, MEMEX grants non-exclusive
licences for the use of its technology and memory components to all personal com-
puter manufacturers for a royalty on every computer shipped, regardless of whether
any MEMEX memory components are installed. MEMEX claims that the previous
licensing policy had the unintentional effect of encouraging computer manufactur-
ers to install too few MEMEX memory components, which detracted from com-
puter performance. MEMEX claims that the new licensing practice provides manu-
facturers an incentive to install a more appropriate quantity of memory in
computers.
Analysis
101. The Bureau would likely investigate this case under the abuse of dominance
provision (section 79) of the Act.
937
102. The Bureau would first determine whether memory components that employ
MEMEX’s technology comprise a relevant market and then assess whether
MEMEX substantially or completely controls the supply of product within that
market. In view of the rapid rate of technological development and intense compe-
tition in the production of integrated circuit devices, the Bureau may conclude that
the MEMEX technology competes with other memory technologies, that barriers to
entry are sufficiently low that the scope of the relevant market extends beyond the
MEMEX technology, or that MEMEX is unable to substantially control the supply
of products within the specified relevant market. If the Bureau determines that
MEMEX faces effective competition from other suppliers of memory components
then it would likely conclude that further investigation is not warranted. If, on the
other hand, the Bureau concludes that the memory components supplied by the al-
ternative suppliers are not considered effective substitutes and would not allow
computer manufacturers to build computers that could compete with those using
MEMEX’s memory component, the Bureau might determine that further inquiry
was warranted.
103. Assuming the Bureau determined that the MEMEX technology defines the
relevant market and MEMEX substantially controls that market, the Bureau would
then consider whether MEMEX’s use of its new licensing arrangements constituted
a practice of anti-competitive acts. This determination would depend on the spe-
cific terms of the contracts and the likely effect they would have on actual or poten-
tial competitors in the relevant market. While MEMEX’s licensing contracts do not
expressly prohibit computer manufacturers from using memory components based
on technology other than MEMEX’s, they effectively impose a tax on computer
manufacturers who use memory components from another supplier.53 The imposi-
tion by a dominant supplier of long-term licensing contracts containing such provi-
sions could preclude competition and maintain the supplier’s market power. Ac-
cordingly, the Bureau would determine whether these contracts are in widespread
use and their duration, and consider MEMEX’s business justification for charging
the per-computer royalty. It would also consider whether the per-computer royalty
deters computer manufacturers from buying memory components from alternative
suppliers.
104. If the Bureau determined that the licensing contracts were a practice of anti-
competitive acts, the Bureau would then assess the likely impact of MEMEX’s new
licensing practice on competition and the price of memory components. If the Bu-
reau determined that this practice creates, enhances or preserves market power, it
would likely seek to have the new licensing practice voluntarily terminated. Failing
that, it would likely bring an application before the Tribunal seeking to terminate
this practice.
53 A manufacturer who wishes to use alternative memory products must pay twice, once for
the alternative component and a second time for the per-computer royalty payable to
MEMEX.
938
Example 6: — A Patent Pooling Arrangement

105. Five firms hold patents on technologies required by producers to develop wid-
gets that conform to an international standard. To facilitate the licensing of their
patents, the five firms hire an independent expert to review the patents of each firm
and determine those that are essential for implementing the standard based on the
underlying technical characteristics of the technologies. Upon completion of the
review, the five firms create a patent pool and each of them licenses its essential
patents on a non-exclusive basis to the pool. The pool is organized as a separate
corporate entity whose role is to grant a non-exclusive sub-licence to all the patents
in the pool on a non-discriminatory basis to any party requesting one. The patent
pool administrator collects royalties from licensees and re-distributes the revenue to
pool members according to a formula that is partly based on the number of patents
that each member has contributed to the pool. Each of the five members of the pool
retains its right to license its own essential patents outside the pool to third parties
to make widgets that conform to the standard or widgets that may compete with
those that conform to the standard.
106. The patent pool agreement specifies that if a final court judgment declares a
patent in the pool to be invalid, that patent will immediately be excluded from the
pool. In addition, the agreement requires that an independent expert re-assesses the
patents in the pool every four years to ensure that they are essential to developing
widgets conforming to the international standard. Licensees also have the ability to
Guidelines
hire an independent expert to review any patent that they feel is not essential for
developing widgets conforming to the standard. If, in either case, the expert con-
cludes that one or more patents are not essential to developing widgets that con-
form to the standard, those patents are excluded from the pool. The decisions of
experts are final and are binding upon the pool members.
107. The patent pool agreement also includes provisions allowing each pool mem-
ber to audit the books of the pool administrator, and provisions allowing the pool
administrator to audit the books of each licensee to verify royalty amounts. In each
case, provisions are put in place to guard against confidential business information
being divulged to either pool members or licensees.
Analysis
108. The Bureau recognizes that patent pools can often serve a pro-competitive
purpose by, among other things, integrating complementary technologies, reducing
transaction costs and clearing blocking patents. Where patent pools may represent
an agreement between competitors or potential competitors, the Bureau would
likely review them under section 90.1 of the Act rather than section 45, unless the
Bureau has evidence that the patent pool was simply used as a means to facilitate
an agreement prohibited under subsection 45(1).54
54 The Bureau’s Competitor Collaboration Guidelines, December 2009, outline the Bureau’s
approach for determining whether to pursue an investigation under section 45 versus section
90.1.
939
109. Despite their potential benefits, patent pools may also raise competition con-
cerns. If the patented technologies inside the pool are substitutes then the pool can
be a mechanism for the pool members to restrict competition between themselves
and increase royalty rates above levels that would have existed in a competitive
market. Alternatively, if a patented technology inside the pool is a substitute for a
technology outside the pool, the pool could be used as a bundling mechanism to
effectively foreclose the outside technology. Other potential competition concerns
are that a pool’s members may discriminate among licensees or use the pool to
share confidential business information so as to reduce competition in a down-
stream market.
110. To evaluate whether a patent pool would likely cause a competition issue, the
Bureau would first seek to determine whether each patent placed inside the pool is
essential for developing the product or service that is the basis behind the formation
of the pool. In the case at hand, if each patent inside the pool is required to imple-
ment the widget standard, then the members of the pool cannot be viewed as hori-
zontal competitors; a firm looking to buy technologies to develop widgets con-
forming to the standard would need permission to use each patented technology in
the pool. A pool comprised of only non-competing essential patents would not have
the potential to harm competition among suppliers of technology either inside or
outside the pool.
111. In this example, the Bureau would look positively on the fact that pool mem-
bers engaged an independent expert to determine which of their patents are essen-
tial to the widget standard. However, the Bureau would evaluate whether the expert
is qualified to provide such an opinion, and whether he/she was provided with the
incentive to work independently, without influence from pool members. The Bu-
reau would take additional assurance from the fact that an expert would continue to
periodically review the patents to ensure they remain essential, as well as from the
ability of licensees to challenge patents by requiring a separate independent review.
The fact that any patents found to be invalid would also be removed from the pool
would also contribute to the Bureau’s assurance that the pool has taken adequate
measures to only include essential patents.
112. Given that the pool administrator issues licences on a non-discriminatory basis
to all interested parties, the Bureau would likely conclude that the technologies in-
side the pool were not being used to distort competition in a downstream widget
market. The fact that pool members remain free to license their patents indepen-
dently to other widget producers provides more evidence that competition in the
downstream widget market would not be distorted by the pool.
113. As a final step, the Bureau would review the pool agreement’s provisions re-
lating to the sharing of confidential information and ensure that such provisions
provide adequate safeguards against the pool being used to facilitate coordination
among pool members or licensees.
114. Absent any evidence that the patent pool is used to facilitate an agreement
prohibited under subsection 45(1), based on the analysis above, the Bureau would
likely conclude that the patent pool does not raise any issues under the Act.
940
Example 7: — Agreement to Foreclose Complementary Products

115. There are five major record labels. The largest two, ROCKCO and POPCO,
which together account for more than 65 percent of total sales and 70 percent of all
major label artists, have formed a joint venture (DISCO) to develop, produce and
market a new generation of digital playback devices. The DISCO technology pro-
vides a level of sound quality and other features far superior to those offered by
existing technologies. DATCO has also developed a digital sound technology with
similar high-fidelity qualities, but which is also portable and allows users to record.
The costs of the two technologies are similar, but the technologies themselves are
incompatible: music digitally encoded in DISCO format must be re-encoded for
playback on DATCO’s player. Under the terms of their joint venture agreement,
ROCKCO and POPCO agree to not release, or license any other person to release,
their copyrighted recordings in a digital format other than the DISCO format. Con-
sistent with that agreement, ROCKCO and POPCO have declined DATCO’s re-
quest for a licence to convert and release ROCKCO and POPCO recordings in the
DATCO format. The other three record labels predict — correctly — that consum-
ers will be reluctant to purchase the DATCO technology if they are unable to ob-
tain music from either ROCKCO or POPCO in that format. The other record com-
panies are willing to release their recordings in the DATCO format, but find that
there is no market for it and are compelled by popular demand to license the
DISCO technology to release their recordings in the DISCO format. As a result of
Guidelines
the foregoing, DATCO’s digital sound technology, which reviewers have generally
viewed as superior to the DISCO technology, is being withdrawn and DISCO is
substantially increasing both the price of the playback equipment that it sells and
the royalties charged to the other record companies for the use of the DISCO tech-
nology to release recordings in the DISCO format. The Bureau has concluded that
the joint venture would not meet the definition of a merger as specified in section
91 of the Act.
Analysis
116. The Bureau would likely examine this case under the agreements and arrange-
ments provision (section 90.1) and/or the abuse of dominance provision (section
79) of the Act.
117. The matter would not be considered under section 45 because the ROCKCO
and POPCO joint venture would not be viewed as an agreement between competi-
tors to fix prices, allocate markets or customers, or restrict output. Even if the re-
fusal to release recordings in another format or grant a licence are considered out-
put restrictions, the ancillary restraints defence would likely apply because they are
ancillary and directly related to the broader joint venture agreement to develop the
DISCO technology. As well, these restraints appear reasonably necessary to attract
a sufficient number of customers to the DISCO technology to make the joint ven-
ture viable.
118. As a first step, the Bureau would consider whether the alleged anti-competi-
tive conduct, namely the refusal of ROCKCO and POPCO to license the reproduc-
tion of their copyrighted recordings in the DATCO format, was a mere exercise of
941
their IP rights or involved something more. In this case, the Bureau would likely
determine that the terms of the DISCO joint venture agreement and the refusal to
license constituted joint conduct and hence would be considered conduct that was
beyond the mere exercise of an IP right.
119. The Bureau may elect to review the agreement under section 90.1 of the Act if
ROCKCO and POPCO could be considered competitors in a relevant market. In
this example, the important consideration in determining if the firms are competi-
tors is determining if ROCKCO and POPCO would have likely developed the
DISCO, or similar, technology independently in the absence of the agreement. If
the Bureau were to determine that this would be the case, then ROCKCO and
POPCO could have been expected to compete in the market for digital playback
devices in the absence of their joint venture and the agreement would be reviewed
under section 90.1.
120. If, on the other hand, ROCKCO and POPCO were determined not to be com-
petitors, the Bureau would elect to review the joint venture agreement under the
abuse of dominance provision, on the basis that the joint venture agreement estab-
lished and provided for the joint abuse of a dominant position. The review would
be carried out in accordance with the framework and criteria for abuse of domi-
nance outlined in the previous examples. Whichever provision of the Act would
apply, the Bureau would need to establish the affected relevant market or markets,
consider barriers to entry and evidence of market power or dominance, demonstrate
a substantial lessening or prevention of competition and assess any business justifi-
cations or efficiencies.
121. If the Bureau were to proceed under sections 79 or 90.1, it would need to
establish that the DISCO joint venture has substantial market power in either the
market for digital sound technology or digital playback equipment. In addition, it
would need to find that the DISCO joint venture had engaged in anti-competitive
conduct that substantially lessens or prevents competition. The anti-competitive
acts in this case would relate to the acquisition and foreclosure by the DISCO joint
venture of access by its competitors to the music in the ROCKCO and POPCO
music libraries. Foreclosure of access to these materials could prevent alternative
sound recording technologies from acquiring the critical mass of desirable music
content required for them to achieve viability. This conduct could substantially pre-
vent or lessen competition and lead to the monopolization or the creation of domi-
nance in the markets for digital sound technology and/or digital playback equip-
ment sound reproduction. The foreclosure of other technologies likely would create
market power for DISCO in these markets and would be inefficient, as it would
reduce consumer choice, lead to increases in the royalties paid by the record com-
panies to use this type of technology and increase the price of playback devices.
Given such a finding, the Bureau would likely seek an order requiring that
ROCKCO and POPCO divest themselves of DISCO or that ROCKCO and POPCO
license their works for release in alternative formats.
942
Example 8: — Refusal to License Intellectual Property

122. ABACUS and two other firms were the first to market a spreadsheet for per-
sonal computers. Electronic spreadsheet software was one of the applications that
established personal computers as an essential tool for business. In the first five
years, ABACUS out-sold its nearest competitor nearly two to one and its installed
base (cumulative sales) grew to 50 percent. In the next two years, its annual market
share grew to more than 75 percent and one of the other original firms left the
market. At about the same time and after three years of programming, CALCULA-
TOR introduced spreadsheet software that had a number of innovative features not
found in ABACUS. However, CALCULATOR soon ran into financial difficulties
despite the innovative features and a lower price. CALCULATOR approached AB-
ACUS and requested a licence to copy the words and layout of its menu command
hierarchy (for the purpose of this example, assume that permission was required
since ABACUS had valid copyright rights in these works). With permission, CAL-
CULATOR could have relaunched its product with a menu command hierarchy
identical to that of ABACUS, which would have given CALCULATOR the ability
to read ABACUS files and ensured compatibility between the two products. ABA-
CUS refused to grant a licence and publicly announced that it would enforce its IP
rights against CALCULATOR if it copied the ABACUS hierarchy. In light of this,
several other prominent software makers announced that they were discontinuing
their spreadsheet development programs.
Guidelines
123. An important characteristic of spreadsheets that affects their benefits to a pur-
chaser is network effects. Network effects exist if the value of a product increases
with the number of buyers who purchase compatible products. Network effects for
spreadsheets arise since the greater the size of the network (the installed base of
compatible spreadsheets), the greater the number of individuals with whom files
can be shared, the greater the variety of complementary products (utilities, software
enhancements and macros), the more prevalent are consulting and training services,
and the greater the number of compatible data files.
Analysis
124. ABACUS’s refusal to license its copyrighted works would constitute a “mere
exercise” of its IP rights and would, therefore, be subject to review only under
section 32 of the Act.
125. To establish whether ABACUS’s refusal created an undue restraint of trade or
unduly lessened competition, the Bureau would first determine whether the refusal
adversely affected competition in a relevant market that was different or signifi-
cantly larger than the subject matter of ABACUS’s IP rights or the products or
services that result directly from the exercise of such IP rights. In this case, compet-
itive harm is alleged in the market for ABACUS-compatible spreadsheets.
126. Whether the relevant market is determined to be ABACUS-compatible spread-
sheets depends on the extent and importance of network effects and switching
costs. If network effects are important, consumers that have never purchased a
spreadsheet may still purchase the more expensive ABACUS product. Consumers
who are already using ABACUS may face significant costs to switch to a new
943
spreadsheet (resulting from, for example, customers’ need to re-train personnel,

convert existing spreadsheet files to a new format, or purchase new complementary
products) and they also would lose the network benefits associated with ABACUS.
If network effects and switching costs are material, then existing ABACUS con-
sumers are unlikely to switch and new consumers are likely to choose ABACUS
even if it is priced above competitive levels
127. If the relevant market is determined to be ABACUS-compatible spreadsheets,
then ABACUS would be the only producer and thus have 100 percent control of
this market. If, in addition, entry barriers were found to be high, which is likely in
an industry experiencing network effects, the Bureau would conclude that ABA-
CUS is dominant. In determining whether the installed base of ABACUS contrib-
utes materially to entry barriers, the Bureau would consider the pace of innovation
and the potential for a new technology to “leap-frog over” ABACUS despite its
advantages (that is, its installed base and the switching costs). The Bureau would
also endeavour to determine whether there are other efficient avenues for creating
compatibility that would not infringe the IP rights of ABACUS.
128. If the relevant market is determined to be ABACUS-compatible spreadsheets
and the Bureau concluded that this market was significantly larger than the subject
matter of ABACUS’s IP and the products that result directly from the exercise of
such IP rights, then the Bureau would likely conclude that the IP is an essential
input for firms participating in the relevant market. On this basis, ABACUS’s re-
fusal would satisfy the first step of the Bureau’s two-step analysis to determine
whether it would seek to have an application brought under section 32.
129. In the second step, the Bureau would determine whether ABACUS’s refusal to
license its IP would adversely alter firms’ incentives to invest in research and de-
velopment in the economy. For this analysis, the Bureau would investigate whether
ABACUS’s ability to prevent compatibility may have a chilling effect on the devel-
opment of more advanced spreadsheets. In addition, the Bureau would determine
whether the choice by ABACUS of the words and layout of its menu hierarchy was
likely arbitrary, involved little innovative effort and had little value relative to other
substitutes. Related to this analysis, the Bureau would determine whether in the
absence of an installed base and switching costs, ABACUS’s terms and menu hier-
archy would be no better or worse than CALCULATOR’s (or any other). If the
Bureau concluded that the presence of an installed base and switching costs were
the reasons that ABACUS-compatible spreadsheets are a market and that ABACUS
had market power, it would consider enforcement action under section 32. In this
circumstance a special remedy invoked under section 32 may restore incentives for
other firms to engage in research and the development of competing compatible
spreadsheet programs.
130. If the facts of the case suggest potential enforcement under section 32, the
Bureau would recommend that the Attorney General seek a special remedy that
would allow other spreadsheet firms to gain access to the words and layout of AB-
ACUS’s menu hierarchy.
944
Example 9A: — Product Switching (“Hard” Switch)55

131. BRAND is a brand-name pharmaceutical company that sells innovative phar-
maceutical drugs. One of its top sellers in terms of revenue, Product A, has been
sold in Canada for many years, and continues to be sold, but will lose patent protec-
tion in six months. Two years ago BRAND introduced another product, Product B,
which takes a slightly different form from and alleviates the same affliction as that
treated by Product A. The number of prescriptions for Product B remains low.
Product B will remain under patent protection for the next 10 years.
132. GENERIC, a pharmaceutical company that produces generic drugs, is set to
launch a generic version of Product A (“Generic A”) as soon as Product A’s patent
protection expires. Before its patent expires, BRAND withdraws Product A from
the market by ceasing to manufacture it and by buying back inventories from
wholesalers and pharmacies. BRAND notifies health care professionals that Prod-
uct A is no longer available. In response to this development, physicians prescribe
Product B to patients in place of Product A and a large number of prescriptions for
Product A are replaced by prescriptions for Product B. Because Product A is the
reference product for (or bioequivalent to) Generic A, pharmacies are prohibited
from automatically substituting Generic A for the prescribed Product B. As a result,
there is a competition concern that GENERIC’s entry may be sufficiently impeded
and that through an anti-competitive act, BRAND will successfully maintain its
market power.
Guidelines
Analysis
133. If the Bureau was of the view that BRAND’s conduct could be for the purpose
of forcing the replacement of sales of Product A with those of Product B to exclude
or impede entry by GENERIC and Generic A, the Bureau would not view the with-
drawal of Product A by BRAND as a mere exercise of its patent right and thereby
conduct exempt under subsection 79(5). The Bureau would also not view the con-
duct as reviewable under section 32. Accordingly, the Bureau would likely examine
the conduct of BRAND under the abuse of dominant position provision (section
79) of the Act.
134. The Bureau would first seek to define a relevant market that encompasses
Product A. Given that Generic A is bioequivalent to Product A, the Bureau would
likely conclude that both drugs are in the same relevant market. The Bureau would
also consider whether other drugs, such as Product B, are sufficiently close substi-
tutes to Product A to be considered in the relevant market. Important evidence as to
55 For an example of a Bureau enforcement matter involving conduct similar to that in this
Example, see Competition Bureau Statement Regarding the Inquiry into Alleged Anti-
Competitive Conduct by Alcon Canada Inc. Brand-name manufacturers withholding
Canadian Reference Products to delay generic entry may also be conduct that poses
competition concerns. For an example of a Bureau enforcement matter involving this type of
conduct, see Competition Bureau Statement Regarding Its Investigation into Alleged
Practices of Celgene, Pfizer, Sanofi.
945
what drugs may be in the relevant market would come from the evidence of physi-
cian/patient switching behaviour when BRAND withdrew Product A from the
marketplace.
135. If the Bureau determined that BRAND was dominant in a relevant market that
included Generic A and Product A, it would then proceed to determine whether
BRAND’s conduct, including that of withdrawing Product A from the marketplace,
constituted a practice of anti-competitive acts. In making this determination, the
Bureau would examine the likely effect of BRAND’s conduct on the ability of GE-
NERIC to enter and compete in the relevant market. For example, the Bureau
would examine the possibility of GENERIC marketing Generic A directly to physi-
cians. Ultimately, the Bureau would seek to determine whether BRAND’s conduct
would either significantly foreclose the entry of GENERIC or delay that entry for a
significant period.
136. The Bureau would also examine whether the purpose of BRAND’s conduct
was to delay or foreclose the supply of Generic A by GENERIC, or whether there
was some other legitimate business justification. For example, if BRAND removed
Product A from the market because it was not profitable, that may be viewed as a
legitimate business justification. The Bureau would also consult with persons with
relevant expert medical knowledge concerning the products at issue. If the Bureau
determined that physicians viewed Product B as providing no or trivial medical
benefit over Product A, it would doubt any argument advanced that Product B is
superior to Product A and the purpose of the withdrawal of Product A was to transi-
tion patients to a higher-quality treatment.
137. If the Bureau concluded that BRAND was dominant in a relevant market and
that it had engaged in a practice of anti-competitive acts, it would also assess
whether BRAND’s conduct had caused a substantial lessening or prevention of
competition. As part of this analysis, the Bureau would likely examine the differ-
ence between the price of Product B and the price at which Generic A would have
been expected to be sold if it had not been delayed or foreclosed by BRAND’s
conduct. As other evidence of harm resulting from BRAND’s conduct, the Bureau
would likely cite the negative effect of Product A’s withdrawal on limiting physi-
cian/patient choice for prescription drugs.
138. If the Bureau concluded that the constituent elements of subsection 79(1) were
met, it would likely seek to negotiate a remedy56 with BRAND and failing that,
bring an application before the Tribunal.
56 The remedy that the Bureau may seek will depend on the particular facts of the case. In
some cases, simply ordering the patentee to make its former product available again for sale
may not adequately overcome the anti-competitive conduct. For example, the Bureau may
seek an order requiring the brand firm to notify physicians informing them that its former
product has been re-supplied.
946
Example 9B: — Product Switching (“Soft” Switch)

139. Consider the same set of circumstances as in Example 9A but where BRAND
does not withdraw Product A from the market. Instead, BRAND continues to sell
Product A but it stops promoting the drug to physicians.
Analysis
140. In this circumstance, BRAND’s conduct would not likely raise an issue under
the Act provided that it did not anti-competitively undermine the prescription base
of Product A (e.g., making false or misleading statements about Product A).
7.2 — Conduct Involving Patent Assertion Entities

141. A patent assertion entity (“PAE”) can generally be described as a business that
acquires or otherwise obtains the legal rights to patents from innovating companies
for the purpose of asserting them against potential infringers who are using the
patented technologies. Importantly, a PAE does not use or manufacture products
based on the patented technologies it acquires.
142. Some have argued that competitive concerns arise with PAEs asserting that
their patents have been infringed and using aggressive tactics in order to extract a
settlement payment or licensing royalties. This may result in increased royalties in
settlements, relative to the situation if the infringement suits had been brought by
Guidelines
the original patentees, as PAEs face different incentives and are not open to in-
fringement counterclaims. PAEs however may also be viewed as beneficial for in-
novation because the legitimate assertion of patent rights can assist innovators in
maximizing their returns from their research efforts, which in turn would provide
stimulus for further research. The role of competition law enforcement with respect
to PAEs is a rapidly evolving area of thought and, as developments occur, the Bu-
reau will continue to refine its enforcement approach and may revisit its guidance
in this area.
143. There is also a concern that PAEs (among others) may use false and mislead-
ing claims in order to extract license fees from small and medium-sized enterprises
that pay the fees in order to avoid a possible patent infringement lawsuit.
Example 10: — Representations Made in the Context of Asserting Patents

144. Firm A acquired patents from innovating companies for the purpose of earning
revenue by asserting them against firms that are infringing the patented technolo-
gies. Following the acquisition, Firm A identified a significant number of busi-
nesses that it had evidence were infringing the patents, and sent notices by regis-
tered mail to all of the businesses. The notices indicated that firm A had acquired
the patents, and that it believed that the recipient of the letter had infringed one or
more of the patents.
145. The notice further indicated that if the recipient was indeed infringing one or
more of the patents, the recipient would need to pay a significant licensing fee in
order to avoid litigation. In its notices, Firm A claimed that many businesses had
already paid the licensing fee, and that it would commence legal proceedings
947
against the recipient within two weeks if the licensing fee was not paid immedi-
ately. A number of businesses that received these letters complained to the Bureau.
Analysis
146. Like all businesses in Canada, PAEs must abide by the misleading advertising
and deceptive marketing practices provisions of the Act. The Act prohibits making
a representation to the public that is false or misleading in a material respect, where
the representation is made to promote a product or business interest. Such matters
are reviewable pursuant to paragraph 74.01(1)(a) of the Act.
147. Based on the facts, it is clear that the purpose of the notices in this case was to
promote Firm A’s business interests by getting recipients to pay and that the no-
tices, which were sent to a significant number of businesses, were sent to members
of the public. The Bureau’s examination, therefore, would focus on whether the
notices included representations that were false or misleading in a material respect.
148. In determining whether the representations were false or misleading, the Bu-
reau would consider both the general impression created by the notice, as well as its
literal meaning. In the example, the representations created the general impression
that many businesses had already paid Firm A the licensing fee, and that the firm
would commence legal proceedings against the recipient if the licensing fee was
not paid immediately.
149. If the Bureau’s examination in this example revealed that both representations
were true, then they would not raise any concerns under the misleading advertising
and deceptive marketing provisions of the Act.
150. Conversely, if the examination revealed that either of Firm A’s claims were
not true, in that other businesses had not already paid Firm A the licensing fee, or
that Firm A had no intention of commencing legal proceedings against the recipi-
ents, then this would raise concerns that the representations were false or mislead-
ing. If the Bureau concluded that the representations would affect the likelihood of
the recipients taking some significant action in response to the claims, up to and
including acceding to the demand, then the representations would also be consid-
ered material. In such event, the Bureau would have grounds to file a notice of
application with the Tribunal or a court alleging that Firm A had engaged in re-
viewable conduct contrary to section 74.01(1)(a) of the Act.
151. If the Tribunal or court found that reviewable conduct did indeed occur, and
that Firm A failed to exercise due diligence to prevent the conduct from occurring,
it could order the firm not to further engage in the conduct, to pay an administrative
monetary penalty, to pay restitution, and to publish a corrective notice.
152. In addition, the Act provides that if a false or misleading representation is
made knowingly or recklessly, then it may contravene the criminal provisions
found in section 52 of the Act. In this regard, the Bureau’s bulletin on choice of
track indicates that in most instances of misleading advertising, the civil track will
948
be pursued, unless certain criteria are satisfied.57 Cases which meet these criteria
can be referred to the DPP for prosecution. Convictions under the criminal provi-
sions can result in fines at the discretion of the court, as well as imprisonment for
individuals of up to a maximum of 14 years.
Example 11: — Assignment of Patents for Enforcement

153. OPCO1 is a firm that produces gadgets and has a number of patents related to
gadget technology. Historically OPCO1 has enforced its patents itself with limited
success — however, recently OPCO1 assigned its patents to PAE, a firm that ex-
clusively enforces IP. Under their arrangement OPCO1 and PAE will split any rev-
enues that result from enforcing the patents. PAE does not have the ability to en-
force any other IP pertaining to gadgets.
154. Subsequently, PAE sues a rival gadget manufacturer, OPCO2, alleging that
many of OPCO2’s gadget designs infringe the patents assigned to PAE by OPCO1.
Analysis
155. Because the Bureau considers the assignment of a patent as something more
than the mere exercise of an IP right, this conduct would potentially be subject to
review under the general provisions of the Act.
156. As noted in subsection 4.2.1, although the Act may prescribe limits on to
Guidelines
whom and how an IP owner may license, transfer, or sell their IP, it does not chal-
lenge the fundamental right to do so. The Bureau is of the view that, in general, IP
holders arranging their affairs so as to more effectively enforce their IP rights do
not raise issues under the Act. This may include engaging the services of firms that
specialize in the enforcement of IP rights.58
57 In order to proceed on a criminal track both of the following criteria must be satisfied:
• There must be clear and compelling evidence suggesting that the accused knowingly or
recklessly made a false or misleading representation to the public. An example of such
evidence is the continuation of a practice by the accused after complaints have been
made by consumers directly to the accused; and
• If there is clear and compelling evidence that the accused knowingly or recklessly
made a false or misleading representation to the public, and this evidence is available,
the Bureau must also be satisfied that criminal prosecution would be in the public inter-
est. The factors to be taken into account in making this public interest determination
will vary from case to case, and may include the seriousness of the alleged offence and
mitigating factors. For more information see the Misleading Representations and De-
ceptive Marketing Practices: Choice of Criminal or Civil Track under the Competition
Act Bulletin.
58 However, as noted in Example 6 on Patent Pooling Arrangements, issues can arise when a
transfer of IP rights results in the combination of IP rights within a single entity, resulting in
a substantial lessening or prevention of competition. For instance, transfers that result in
patents covering substitutable technologies becoming concentrated within a single entity
who can then reduce competition to a degree greater than inherent in the patents individually
949
157. In this case, the Bureau would likely conclude the assignment of OPCO1’s
patents to PAE simply for the purpose of more effective enforcement does not raise
issues under the Act.
7.3 — Settlements of Proceedings under the Patented Medicines

(Notice of Compliance) Regulations
158. The discussion and hypothetical examples in this subsection are designed to
illustrate the analytical framework that would be applied by the Bureau in con-
ducting its review of settlements between brand and generic pharmaceutical com-
panies of proceedings under the Patented Medicines (Notice of Compliance)
(“PMNOC”) regulations. Health Canada’s Guidance Document: Patented
Medicines (Notice of Compliance) Regulations offers additional details on these
regulations.
159. The Bureau’s enforcement approach to settlements can be summarized as
follows:
1. An entry-split settlement (defined below) pursuant to which the generic
firm enters the market on or before patent expiry will not pose an issue under
the Act (see Example 12).
2. A settlement with a payment (defined below) to the generic firm pursuant to
which the generic firm enters the market on or before patent expiry may be
reviewed under section 90.1 (see Example 13), or possibly section 79;59
3. The Bureau will not review a settlement under section 45 unless (a) the
settlement extends beyond the exclusionary potential of the patent by delaying
generic entry past the date of patent expiry (see Example 14A), (b) the settle-
ment extends beyond the exclusionary potential of the patent by restricting
competition for products unrelated to the patent subject to the PMNOC pro-
ceeding (see Example 14B), or (c) the settlement is a “sham” (see Example
14C).60
may raise issues under the Act. As PAE does not hold any other IP rights pertaining to
gadgets, the Bureau would not have concerns in this regard based on the facts of this exam-
ple. A transfer of IP could also create a competition issue if it is made by an owner of a
standard essential patent for the purpose of avoiding a licensing commitment. See section 7.4
for a discussion of competition issues arising from standard essential patents and licensing
commitments.
59 In general, agreements between competitors that may be examined under section 79 in-
clude situations where one or more party is dominant, or jointly dominant, and the agreement
results in or facilitates conduct that has a negative effect on a competitor that is exclusionary,
predatory or disciplinary, such that it has had, is having or is likely to have the effect of
preventing or lessening competition substantially in a market.
60 In this context, the Bureau considers a “sham” to be a case where the parties recognize
that the patent is invalid and/or not infringed and use a purported settlement of the PMNOC
proceedings to engage in conduct contrary to Section 45 as opposed to addressing patent-
950
160. The Bureau recognizes that there are significant differences in the regulatory
regimes governing pharmaceuticals in Canada relative to other jurisdictions and
that these may have implications for both the incentives of parties to reach settle-
ments and the terms of settlements that may occur in Canada. For example, two
unique features of Canada’s PMNOC regulations that govern generic entry prior to
patent expiry are the following:61
1. Exclusivity for the first generic filer: In Canada there is no six-month exclu-
sivity period available to the generic firm who is the first to challenge a brand
firm’s patent with respect to a particular pharmaceutical formulation. This
may limit the ability of settlements in Canada involving the first generic chal-
lenger to delay the entry of subsequent generic firms. This in turn may impact
the incentives of the brand and the first generic filer to enter into settlements
with payments to delay generic entry.
2. Section 8 damages: Generic firms in Canada who are engaged in litigation
under the PMNOC regulations have a contingent claim to damages against the
patentee pursuant to section 8 of the PMNOC regulations. The prospect of a
brand being liable for these damages is a relevant consideration when evaluat-
ing the magnitude of a brand firm’s payment to the generic firm in a settle-
ment agreement.
161. In addition, brand and generic firms in Canada typically face significant re-
strictions on the prices they are permitted to charge for their products in order to be
Guidelines
listed on provincial formularies. The Bureau recognizes such restrictions may im-
pact the incentives of generic firms to challenge patents and the terms of settle-
ments to PMNOC proceedings.
7.3.1 — Introduction
162. The Bureau recognizes that in many cases parties may wish to settle PMNOC
proceedings privately rather than fully litigate a matter and risk an adverse judge-
ment from the court. Settlements also provide a benefit to society at large by easing
the burden on the court system and saving limited public resources. However, liti-
gation settlements may pose competition risks if the agreement of the parties goes
beyond what is reasonably necessary to reach a settlement, for example including a
payment to delay generic competition.
163. If a settlement does not involve the brand firm providing any consideration to
the generic firm other than allowing the generic to enter the market on or before
protected rights. That is, the PMNOC regulations and the settlement are used as a disguise
for an otherwise naked conspiracy.
61 Although amendments to the PMNOC Regulations were made effective on September 21,
2017 to introduce a single-track procedure for the determination of patent rights in connec-
tion with patents and certificates of supplementary protection listed on the Patent Register,
the new regulations only apply with respect to notices of allegation served after the new
regulations came into effect. For cases involving notices of allegation served before that
date, the previous PMNOC regulations still apply.
951
patent expiry (an “entry-split” settlement), the Bureau would not review the settle-
ment under the Act.62 The Bureau would view the agreed entry date as reflecting a
compromise between the parties based on each party’s underlying expectation of
succeeding in the PMNOC proceedings. The greater the likelihood that the patent is
valid and infringed, the later in the patent term generic entry would be expected.
Furthermore, agreements where the only consideration provided by the brand is
early generic entry are marked by opposing incentives, with brands seeking later
entry and generics seeking earlier entry. If there is no other consideration flowing
from the brand to the generic firm there would be no reason to believe that the
terms of the settlement were for anything other than a compromise on the patent
merits.
164. In contrast to entry-split settlements, if a settlement involves the brand firm
providing compensation to the generic firm in addition to allowing generic market
entry (a “payment”), the Bureau may review the settlement under the Act. In this
circumstance the payment could create competitive harm if it serves as compensa-
tion to the generic firm in return for delaying its entry into the market. Because the
brand firm would typically make more profit by keeping the generic out of the
market than the brand firm and the generic firm would receive in total by compet-
ing in the market (because generics are typically sold at a much lower price than
branded drugs, with the difference being savings that would accrue to drug buyers),
the parties have an aligned incentive to cede the market to the brand firm and split
the profits from preventing competition. The competition concern with the settle-
ment is that the payment obtained by the generic firm may arise from the sharing of
the brand firm’s (now guaranteed) supra-competitive profits. Drug buyers may be
impacted by this type of settlement through higher prices, and patients may experi-
ence delayed access to affordable medicines.
165. Since a settlement involves more than one party it is not unilateral conduct and
the Bureau would view it as potentially something more than the mere exercise of
the patent right. Accordingly, the Bureau would review settlements under the gen-
eral provisions of the Act (generally section 90.1) rather than section 32. Likewise,
the Bureau would not assume that a valid patent of the brand firm was infringed.
166. The Bureau’s approach to assessing competitor collaborations, including set-
tlements that may delay generic entry, is reflected in the Competitor Collaboration
Guidelines (“CCGs”). Accordingly, other than in the narrow circumstances de-
scribed below, the Bureau would review such a settlement under section 90.1 of the
Act because it would not be viewed as an agreement between competitors to fix
prices, allocate markets or restrict output (i.e., a “naked restraint” on competition).
167. However, the Bureau is aware that settlement practices are dynamic and con-
tinue to evolve, and circumstances may arise where the Bureau elects to review a
62 When reviewing a settlement, the Bureau will also look at other agreements that the set-
tling parties may have made during the same period of time when the settlement was
reached.
952
settlement with a payment under section 79 if the elements of section 79 are

present.
168. A settlement may be reviewed under section 45 only where it extends beyond
the exclusionary potential of the patent or is a “sham”. The Bureau anticipates that
such circumstances would rarely occur.
7.3.2 — Review Under Sections 90.1 and 79 of the Act

169. Section 90.1 applies to agreements between parties that are competitors or
potential competitors. Subsection 90.1(11) defines competitors to include not just
actual competitors, but also “a person who it is reasonable to believe would be
likely to compete” with respect to the relevant product “in the absence of the agree-
ment or arrangement”. Accordingly, the fact that a brand firm and a generic firm
did not compete with respect to the relevant pharmaceutical drug when the settle-
ment was concluded or during the term of the settlement would not prevent the
Bureau from reviewing the settlement under section 90.1. The Bureau would deter-
mine whether the brand firm and the generic firm are potential competitors as part
of its analysis of the nature and extent of the relevant market.
170. Both sections 90.1 and 79 of the Act require the Bureau to establish that a
settlement has the effect of causing a likely substantial prevention or lessening of
competition. Guided by jurisprudence, the Bureau would likely determine whether
Guidelines
a settlement caused harm to competition by adopting a “but-for” test. This test re-
quires determining what would likely have occurred but for the settlement, includ-
ing whether the brand firm and the generic firm would have been likely to compete
earlier than the generic entry date specified in the settlement, and whether entry
would have resulted in the discipline of the brand firm’s market power through the
introduction of a lower cost alternative for drug buyers. This analysis would require
determining whether the magnitude of the payment was so large that it likely had
the effect of delaying generic entry. Importantly, the alternative scenario “but for” a
settlement that includes a payment is not necessarily the fully litigated outcome. It
is possible that the parties may have reached an alternative settlement that was less
restrictive to generic entry.
171. The form of the payment from the brand firm to the generic firm does not
change the Bureau’s fundamental analysis as to whether its effect was to delay ge-
neric entry. The payment may involve a simple monetary transfer from the brand
firm to the generic firm. Alternatively, the payment could involve a monetary trans-
fer with an agreement by the generic firm to provide the brand firm with particular
services such as to market or co-promote products; to provide inventory or backup
manufacturing services; to supply raw material or finished drug products; or to
enter into development agreements in the form of up-front payments, milestones,
sales percentages, or development fees for unrelated products. In these circum-
stances, the Bureau would consider evidence to determine whether the payment
was commensurate with the services provided, rather than a disguised payment to
the generic firm for delaying its entry. In making such a determination, the Bureau
would consider factors such as
i. a history of collaboration between the brand firm and the generic firm;
953
ii. whether the brand firm (or similarly-situated firms) typically enters into
arrangements for such services;
iii. previous attempts by the brand firm to contract for the service;
iv. any documents reflecting the need for the transaction;
v. any documents reflecting the valuation of services; and
vi. the typical payments for such services in the industry.
172. In determining if a payment likely had the effect of delaying a generic firm’s
entry, the Bureau would consider factors such as
i. the fair market value of any goods or services provided by the generic firm;
ii. the magnitude of the brand firm’s section 8 damages exposure under the
PMNOC regulations; and
iii. the brand firm’s expected remaining litigation costs absent settlement.
With respect to (iii), expected remaining litigation costs absent settlement may in-
clude the expected costs of a subsequent appeal, and potential adverse cost awards
at the initial action and in an appeal proceeding.63 If a payment was within a rea-
sonable estimate of these factors based on information known at the time the settle-
ment was reached, the Bureau would conclude that the settlement does not raise
issues under the Act. The Bureau would also consider other justifications and evi-
dence proffered by the parties.
173. When reviewing a settlement under section 90.1 of the Act, the Bureau would
consider possible efficiencies that could be realized through the settlement. When
assessing potential efficiencies, the Bureau would consider factors such as the cred-
ibility of the claims, the link to the settlement, the likelihood of the benefits being
achieved, and whether the benefits would or could not be obtained in the absence of
the settlement. If the Bureau determines that the efficiency exception is not satis-
fied or cannot determine whether it is satisfied due to insufficient information, it
may seek a remedy from the Tribunal to prohibit the settlement. Under section
90.1, the Tribunal may make an order prohibiting any person from doing anything
under the settlement, or requiring any person (with the consent of that person and
the Bureau) to take any other action.
174. If reviewing the settlement under section 79 of the Act, the Bureau would
consider possible business justifications in its determination of whether the settle-
ment was or was part of a practice of anti-competitive acts. In making its determi-
nation, the Bureau would consider a number of factors, including the credibility of
the justifications and the link to the settlement. If the Bureau determines that the
constituent elements of section 79 of the Act are met, it may seek a remedy from
the Tribunal to prohibit the settlement. The remedy sought under section 79 would
63 For settlements involving litigation under the former PMNOC regime, expected remain-
ing litigation costs absent settlement may include the expected costs of a subsequent patent
infringement action and impeachment counterclaim, and potential adverse cost awards at the
prohibition application stage and in an infringement/impeachment proceeding.
954
likely include an order from the Tribunal prohibiting the settlement or the anti-
competitive terms of the settlement. The Bureau may also seek an administrative
monetary penalty from the parties. In addition, the Tribunal is empowered to make
an order directing any or all persons against whom an order is sought to take such
actions as are reasonable to overcome the effects of the practice of anti-competitive
acts in that market.
7.3.3 — Review Under Section 45 of the Act

175. In very limited circumstances like those in Examples 14A, 14B and 14C, a
settlement may reach beyond the exclusionary potential of the patent or be a sham.
For example, a settlement could restrict entry beyond the end of the patent term,
restrict competition among products not at issue in the PMNOC proceeding, or be
entered into even though the settling parties recognize that the patent is invalid
and/or not infringed.
176. While the Bureau will review conduct within the exclusionary potential of the
patent (for example when there is a payment for delayed entry before the patent
expires) under section 90.1 or 79 of the Act, section 45 focuses on settlements that
clearly restrict competition beyond the exclusionary potential of the patent or are
shams. In the limited circumstances where the Bureau may review a settlement
under section 45 of the Act and where the constituent elements of an offence under
that section are satisfied, the Bureau will consider whether the ancillary restraints
Guidelines
defence under subsection 45(4) of the Act, or another defence set out in section 45
of the Act, may apply.64
177. Where the Bureau determines that there is sufficient evidence to establish that
an agreement satisfies the ancillary restraints defence, it will not refer the matter to
the DPP with a recommendation to commence a prosecution under section 45 of
the Act. However, the Bureau may seek a remedy in respect of the agreement under
section 90.1 of the Act if it is of the view that the settlement is likely to prevent or
lessen competition substantially.
178. As is the case in general, parties may approach the Bureau at any time to
resolve a criminal matter prior to referral to the DPP for prosecution. The Bureau’s
Immunity and Leniency Programs provide a clear framework for cooperation and
the provision of information by cooperating parties during investigations related to
Part VI of the Act.65 However, the DPP has the sole authority to engage in plea and
sentencing discussions with counsel for an accused.
179. While the Bureau may, where appropriate, initially elect to evaluate a settle-
ment under the criminal conspiracy provision of the Act, the Bureau may subse-
quently decide that circumstances warrant pursuing a remedy under the reviewable
64 As described more generally in the Bureau’s CCGs, agreements that are directly related
to, and reasonably necessary for giving effect to, a broader agreement may be subject to an
ancillary restraints defence.
65 For more information, consult the Immunity and Leniency Programs under the Competi-
tion Act.
955
matters provisions of the Act at any time prior to referral of the matter to the DPP
for prosecution. In cases where the matter is referred, but the DPP elects not to
pursue prosecution, the Bureau may choose to re-evaluate whether the settlement
should be subject to a remedy under the reviewable matters provisions of the Act.
Example 12: — An Entry-Split Settlement

180. BRAND sells innovative pharmaceutical drugs. One of its top sellers in terms
of revenue, product A, will lose patent protection in ten years. GENERIC plans to
launch a generic version of product A before BRAND’s patent protection for prod-
uct A expires. There are currently no other generics of product A on the market.
Pursuant to the PMNOC regulations, GENERIC serves BRAND with a Notice of
Allegation (“NOA”) stating that its generic drug does not infringe BRAND’s patent
and that BRAND’s patent is also invalid. BRAND challenges both claims in GE-
NERIC’s NOA in court.66 Rather than have the court reach a decision in the
PMNOC proceeding, BRAND and GENERIC enter into a settlement where GE-
NERIC agrees not to market its generic version of product A until five years before
patent expiry. As part of the settlement, GENERIC agrees not to take action against
BRAND to recover damages that it may be entitled to under section 8 of the
PMNOC Regulations. The evidence reveals no other form of consideration, either
in the settlement agreement or otherwise. At the time of reaching the settlement,
GENERIC had successfully met all regulatory requirements for proving safety and
efficacy of its drug.
Analysis
181. Given that the terms of the settlement specify a market entry date for GE-
NERIC that is on or before the expiry date of the patent and that GENERIC is not
receiving any other consideration from BRAND, the Bureau would not take action
against the settlement under the Act. If there were no consideration other than al-
lowing early entry flowing from BRAND to GENERIC there would be no reason to
believe that the terms of the settlement were for anything other than resolving the
litigation based on the merits of the case.
Example 13: — A Settlement with a “Payment”

182. Consider the same set of circumstances as Example 12, but in this case
BRAND provides a monetary payment to GENERIC in addition to allowing GE-
NERIC to enter the market five years before patent expiry.
Analysis
183. This settlement could pose a competition concern for the Bureau because its
terms include a payment from BRAND to GENERIC. If the Bureau were to review
66 For ease of exposition, details of the process under the PMNOC Regulations are deliber-
ately avoided. The reader is advised to consult the documents available through the links
provided above for more information about the PMNOC regulations.
956
the settlement, it would follow its general approach to assessing competitor collab-
orations as outlined in the CCGs. Because the settlement did not extend beyond the
exclusionary potential of the patent and was not a sham, the Bureau would likely
review the settlement under section 90.1 of the Act.
184. For purposes of review under section 90.1 of the Act, the Bureau would typi-
cally, as an initial step, define relevant product and geographic markets that include
BRAND’s product A. If the generic drug is bioequivalent to product A, the Bureau
would likely conclude that both drugs are in the same relevant product market.67
The Bureau would also consider whether other drugs are sufficiently close thera-
peutic substitutes to product A to be included in the relevant product market. For
the determination of the geographic market, the Bureau would consider all regions
in Canada where product A was sold.
185. Section 90.1 of the Act requires the Bureau to establish that a settlement has
the effect of causing a substantial prevention or lessening of competition. In deter-
mining whether “but for” the settlement BRAND and GENERIC would have been
likely to compete earlier than the generic entry date specified in the settlement, the
Bureau would examine the size of the payment to determine whether it was likely
that the settlement had the effect of delaying GENERIC’s entry. In making this
determination the Bureau would consider factors such as
i. the fair market value of any goods or services provided by GENERIC;
Guidelines
ii. the magnitude of BRAND’s section 8 damages exposure under the PMNOC
regulations; and
iii. BRAND’s expected remaining litigation costs absent settlement.
With respect to (iii), expected remaining litigation costs absent settlement may in-
clude the expected costs of a subsequent appeal, and potential adverse cost awards
at the initial action and in an appeal proceeding.68 If a payment was within a rea-
sonable estimate of these factors, the Bureau would conclude that the settlement
does not raise issues under the Act. The Bureau would also consider other justifica-
tions and evidence proffered by the parties.
186. As part of its analysis of whether the settlement substantially prevented or
lessened competition, the Bureau would also determine whether earlier entry by
GENERIC would have lowered prices paid by drug buyers. This would involve
determining the likely price difference that would have prevailed between the
BRAND’s price of product A and GENERIC’s price of product A. In addition, the
Bureau would consider if other prospective suppliers of generics of product A had
67 Mandatory generic substitution rules for drugs on provincial formularies are one of the
main reasons that the introduction of generics largely supplants brand-name drugs and are a
factor considered when defining relevant markets.
68 For settlements involving litigation under the former PMNOC regime, expected remain-
ing litigation costs absent settlement may include the expected costs of a subsequent patent
infringement action and impeachment counterclaim, and potential adverse cost awards at the
prohibition application stage and in an infringement/impeachment proceeding.
957
delivered NOAs or were likely to deliver NOAs in the near future and, if so, when
they would likely enter the market. If there were other generic suppliers who had
delivered NOAs and were involved in PMNOC litigation with BRAND, the Bureau
would seek to determine whether BRAND was in the process of negotiating settle-
ments with those generic suppliers and, if so, what terms and conditions were being
considered.69
187. If the Bureau determined that the magnitude of the payment was so large that
it likely had the effect of delaying entry, the competitive effects from GENERIC’s
delay were significant, and timely entry from other generic suppliers was not likely
to occur on a scale and magnitude to sufficiently constrain the ability of BRAND
and GENERIC to exercise market power in the relevant market, it would conclude
that the settlement substantially prevented or lessened competition.
188. For the purpose of an analysis under section 90.1 of the Act, the Bureau will
consider possible efficiency gains that may be realized through the settlement.
When assessing potential efficiencies, the Bureau will consider factors such as the
credibility of the claim, the link to the settlement, the likelihood of the benefits
being achieved, and whether the benefits would or could not be obtained in the
absence of the settlement.
189. Where the constituent elements of section 90.1 of the Act are met and where
the efficiency exception is not satisfied, the Bureau may seek a remedy from the
Tribunal to prohibit the settlement. Under section 90.1, the Tribunal may make an
order prohibiting any person from doing anything under the settlement or requiring
any person (with the consent of that person and the Bureau) to take any other
action.
Example 14A: — A Settlement beyond the Expiry Date of the Patent

190. Consider the same set of circumstances as in Example 13, but with the differ-
ence that GENERIC agrees to enter the market no earlier than two years after pat-
ent expiry.
Analysis
191. In this case the settlement clearly goes beyond the expiry date of BRAND’s
patent rights. BRAND’s patent expires in 10 years and the settlement prevents GE-
NERIC entry within the next 12 years. The settlement provides BRAND with two
more years of protection from competition from GENERIC than what BRAND’s
patent provides (assuming it is valid and infringed). In the absence of a legitimate
justification, the Bureau would likely view the settlement as contravening subsec-
tion 45(1) of the Act as it reaches beyond the exclusionary potential of the patent
69 The Bureau recognizes that in certain instances some documents will be covered by one
or more claims of privilege.
958
and is a market allocation agreement where BRAND is providing a payment to

GENERIC as compensation to stay out of a market after the patent expires.70
192. The Bureau would consider any evidence related to an ancillary restraints de-
fence. In considering the defence under subsection 45(4) of the Act, the Bureau
would examine whether
i. the restraint, in this case the payment from BRAND to GENERIC in return
for the entry date, is ancillary to a broader or separate agreement that includes
the same parties;
ii. the restraint is directly related to, and reasonably necessary for giving effect
to, the objective of the broader or separate agreement; and
iii. the broader or separate agreement, when considered in the absence of the
restraint, does not contravene subsection 45(1).
Without evidence that the restraint is reasonably necessary for giving effect to the
broader settlement between BRAND and GENERIC, however, the ancillary re-
straints defence would not apply to the parties’ settlement and the Bureau would
refer the matter to the DPP for prosecution. If the DPP elected not to pursue prose-
cution, the Bureau could choose to re-evaluate whether the settlement should be
subject to a remedy under the reviewable matters provisions of the Act.
Example 14B: — A Settlement beyond the Product Scope of the Patent
Guidelines
ence that, instead of offering a monetary payment, BRAND agrees to withdraw its
product from another market where it is currently competing with a product sup-
plied by GENERIC. The product that BRAND agrees to withdraw is not one that is
subject to the PMNOC proceeding where the parties reached the settlement.
Analysis
194. This settlement would be viewed as extending beyond the product scope of
BRAND’s patent rights. The agreement allows BRAND to settle the PMNOC pro-
ceeding by agreeing to limit its competition with GENERIC in a pharmaceutical
market that is unrelated to its patent at issue in the proceeding. In the absence of a
legitimate justification, the Bureau would view the settlement as a market alloca-
tion agreement that may contravene subsection 45(1) of the Act and thus would
investigate the settlement under section 45. The Bureau would consider any evi-
dence related to an ancillary restraints defence as described in example 14A.
Example 14C: — “Sham” Agreement

ence that, during the course of its investigation, the Bureau had reason to believe
70 As mentioned in section 7.3.2, the Bureau may review conduct within the exclusionary
potential of the patent (for example when there is a payment for delayed entry before the
patent expires) under sections 90.1 or 79 of the Act.
959
that both parties recognized that the patent was not valid but that BRAND nonethe-
less challenged GENERIC’s NOA and the parties reached an agreement where
BRAND provided a payment to GENERIC as compensation for it agreeing to delay
its entry into the market.
Analysis
196. In this case, if the Bureau had initiated an investigation under section 90.1 of
the Act, once it had reason to believe that the parties recognized that the patent was
not valid and/or not infringed, it could proceed under section 45 of the Act. The
Bureau would investigate whether the parties reached an agreement in contraven-
tion of subsection 45(1). An ancillary restraints defence would not be applicable
because the settlement was not necessary for any broader or separate agreement.
Accordingly, if the Bureau believed that there was a contravention of 45(1) it
would likely refer the matter to the DPP for prosecution.
7.4 — Collaborative Standard Setting and Standard Essential Patents

197. The following discussion and hypothetical examples in this subsection are de-
signed to illustrate the analytical framework that would be applied by the Bureau in
conducting its review of business conduct involving patents that are essential to
collaboratively determined industry standards. The Bureau recognizes that competi-
tion enforcement policy in this area is undergoing rapid development. Given this,
the Bureau may revisit certain aspects of the guidance in this subsection in the
future in light of experience, changing circumstances and court decisions.
198. The two primary types of industry standards are interoperability standards,
which ensure that products made by different manufacturers can interoperate, and
performance standards, which set minimal requirements (e.g., performance or
safety) for products in an industry. The Bureau recognizes that the development of
standards through formal Standards Development Organizations (“SDOs”) can pro-
vide many procompetitive benefits, such as lowering production costs, increasing
efficiency and consumer choice, reducing barriers to entry, and fostering interoper-
ability and innovation. However, the Bureau also recognizes that standards devel-
opment can pose competition concerns, such as reducing price and/or non-price
competition, foreclosing innovative technologies and restricting firms’ ability to
compete by denying access to the standard or providing access on discriminatory
terms.
199. When patented technologies are incorporated into a standard, one particular
competition concern is patent “hold-up”. There may be many alternative technolo-
gies that could be chosen as a standard so that any given patentee may have limited
market power before a standard is chosen. Once a standard is selected, however,
irreversible investments may lock firms into the standard, making switching pro-
hibitively costly or impractical. High switching costs may create market power for
the owners of patents that cover the standard due to the inability of firms using the
standard to easily substitute other technologies to avoid high royalties. One way
that patent hold-up can occur is when the owner of a patented technology partici-
pating in the standardization process, in violation of SDO rules, fails to disclose its
960
patent to an SDO and then later asserts that patent when access to its patented tech-
nology is required to implement the standard (“patent ambush”). This conduct may
provide the patent owner with market power that is derived from its technology
being necessary to access the standard rather than its ex ante value to buyers or
licensees.
200. To reduce the potential for patent hold-up, some SDOs may adopt an IP policy
that requires participants to disclose their patents that are essential to the standard
that the SDO selects.71 SDOs may also ask participants to identify their most re-
strictive licensing terms and conditions, including the maximum royalty rate that
they would demand if access to their patents becomes necessary to implement the
standard. The Bureau recognizes that SDO participants may rely on such commit-
ments to facilitate bilateral licensing negotiations necessary for the successful
adoption of the standard and to provide assurances to firms who wish to use the
standard that they will be able to obtain access to the necessary patented technolo-
gies. The Bureau also recognizes that before a standard is chosen, SDOs may facili-
tate negotiations between participants who are potential licensees of the standard
and IP owners of rival technologies. Such negotiations provide SDO participants
important information that allows them to choose a standard based not only on
technical merit, but also on the cost of accessing the IP needed to implement that
standard.
201. In the circumstance that the Bureau were to review joint conduct involving
Guidelines
SDO participants, if the Bureau determined that the arrangement was for the pur-
pose of setting an industry standard and there was no evidence that it was for the
purpose of facilitating an agreement prohibited under subsection 45(1), the Bureau
review would proceed under section 90.1 according to the analytical framework
described in the CCGs.
202. Even when an SDO promotes IP disclosure, patent hold-up can still arise if an
owner of a patented technology makes an ex ante licensing commitment, such as an
explicit maximum royalty rate, to encourage its technology to be incorporated into
a standard and then later, if successful, abandons that commitment by charging a
royalty higher than the maximum royalty it promised to charge (“reneging on a
licensing commitment”).72 The concern in this circumstance is that the patentee’s
licensing commitment may serve to provide assurance to the SDO and firms wish-
ing to manufacture standard-compliant products that they would have access to the
patentee’s technology if it was incorporated into the standard. This assurance, in
part, may motivate the SDO to include the patentee’s technology in the standard,
and/or encourage firms to make irreversible investments to develop standard-com-
pliant products. These investments, together with high switching costs, create a set-
ting in which a SDO participant can gain market power because its patent is neces-
71 References in the Guidelines to SDO “participants” is meant to also include SDO

members.
72 Often participants in SDOs make a commitment to license on fair, reasonable and non-
discriminatory terms to all prospective licensees.
961
sary to access the standard rather than from its inherent ex ante value to buyers or
licensees.73
203. Importantly, the Bureau is not a price regulator and will leave the determina-
tion of royalty rates to negotiations between parties or the courts. Absent a clear
breach of a licensing commitment (e.g., demanding a royalty exceeding an ex ante
commitment), it will not take enforcement action against a patentee solely based on
the magnitude of the royalty that it charges. Similarly, the Bureau will not regulate
the specific terms and conditions that a standard essential patentee may impose
when seeking to license its patents. Such terms and conditions, however, may be
reviewed under the general provisions of the Act if they have the potential to cause
competitive harm (e.g., bundling non-essential with essential patents or imposing
no-challenge clauses).
204. Another way that patent hold-up can arise in the context of standard setting is
when a patentee makes a licensing commitment before its technology is adopted in
a standard and then later seeks injunction orders against firms that are willing to
license the technology on terms and conditions meeting the commitment. By seek-
ing an injunction against firms that are “locked-in” to the standard and that face
prohibitive costs to switch to alternative technologies, the patentee can “hold up”
potential licensees and demand higher royalties than if it did not seek the injunc-
tion. The use of injunctions can be particularly problematic when the patentee’s
patented technologies comprise only a small part of the standard, but can nonethe-
less block a prospective licensee’s ability to manufacture and sell standard-compli-
ant products. Given the significant risk to its business, a prospective licensee that is
threatened by an injunction may be compelled to pay a royalty rate greater than the
patentee’s ex ante commitment. Similar to the other cases involving patent hold-up
described above, the Bureau’s concern with the patentee’s conduct is that it could
increase the cost of accessing the standard for firms that wish to develop products
that incorporate the standard and thereby reduce their incentive to innovate or oth-
erwise produce products that use the standard. The patentee’s conduct may result in
foreclosure of companies making standard-compliant products. There is also con-
cern that the increased cost of access will result in increased prices to consumers of
standard-compliant products or that the conduct excludes alternative technologies
that would have been considered for the standard. Finally, the Bureau would also
have concerns that the conduct may weaken incentives for firms to participate in
procompetitive standard-setting activity generally.
205. The Bureau recognizes that a firm’s commitment to license on fair, reasonable
and non-discriminatory (“FRAND”) terms does not mean that it is committing to
license on a royalty-free basis. Firms may make large investments in research and
development and are entitled to seek royalties to recover the value of their invest-
ment. Potential licensees may seek to take advantage of FRAND commitments by
73 The Bureau’s competition concerns would be the same regardless of whether the firm
reneging on the licensing commitment made the commitment itself or accepted the commit-
ment when it acquired the patent.
962
“holding out” for a particular royalty or simply by not undertaking licensing negoti-
ations in good faith. Because of this potential problem, in its inquiry to determine
the underlying purpose for a patentee seeking an injunction (whether seeking the
injunction was, or was part of, a practice of anti-competitive acts under paragraph
79(1)(b)), the Bureau would look for evidence to determine whether the potential
licensee was willing to enter into negotiations and pay a FRAND rate. The Bureau
accepts that in certain circumstances it may be appropriate for a firm that has made
a FRAND licensing commitment to seek an injunction against an infringing party.
Circumstances where the Bureau would conclude that the seeking of an injunction
could be appropriate include:
i. when a prospective licensee refuses to pay a royalty that is determined to be
FRAND by a court or arbitrator;
ii. when a prospective licensee refuses to engage in licensing negotiations;
iii. when a prospective licensee constructively refuses to negotiate (for exam-
ple, by insisting on terms clearly outside the bounds of what could be consid-
ered to be FRAND terms) or
iv. when a prospective licensee has no ability to pay damages (for example, a
firm that is in bankruptcy).
206. The Bureau would likely review conduct that could result in patent hold-up
under section 79 of the Act. The Bureau is of the view that conduct such as patent
Guidelines
ambush, reneging on a license commitment or seeking an injunction against willing
licensees after making a licensing commitment is “something more” than the mere
exercise of patent rights. Accordingly, the Bureau would not consider the exception
in subsection 79(5) to apply, nor would it review the conduct under section 32 of
the Act. The Bureau also recognizes that conduct that may result in patent hold-up
could be addressed as a matter of contract law and will consider this possibility
when exercising its enforcement discretion in a given case. In some situations, the
competitive effects caused by the conduct may not be able to be sufficiently ad-
dressed by means other than competition law remedies. For example, parties that
were not participants in the SDO may be foreclosed from the market.
207. In determining whether a patentee undertaking conduct that could result in
patent hold-up is in a dominant position as required by section 79, the Bureau
would seek to determine whether the patentee had market power in markets that
include the standardized technology or markets that include products that imple-
ment the standard. In considering dominance, the Bureau would consider not only a
patentee’s pre-existing market power (i.e., any market power held by the patentee
before the conduct), but also market power derived from the conduct.
208. In determining whether conduct that could result in patent hold-up has had, is
having or is likely to have the effect of preventing or lessening competition sub-
stantially in a market, the Bureau would look to identify whether, but for the paten-
tee’s conduct, there would likely be substantially greater competition in the markets
where it has a competitive concern. The Bureau would make these determinations
while considering the standard-setting context, which may be characterized by irre-
versible investments and high switching costs. In particular, the Bureau would ex-
963
amine whether the patentee’s conduct created, preserved or enhanced its market
power in a market that uses the standardized technology. Central to this examina-
tion, the Bureau would look to identify any alternative technologies that the SDO
could have turned to at the time the standard was being chosen. The Bureau would
also look to identify any alternative technical standards or technologies that firms
could turn to as a substitute for the SDO standard after it was chosen. If such alter-
natives exist, the Bureau would seek evidence on the magnitude of the switching
costs that firms would face to switch to these alternatives. If alternative technolo-
gies would likely have been chosen as the SDO standard but for the patentee’s
conduct and if alternatives to the SDO standard did not exist, or if switching costs
were prohibitively high, the Bureau would likely conclude that the patentee in-
creased its market power in the market that includes the standardized technology.
209. The Bureau would also look to determine whether competition would be
harmed in markets for products that implement the SDO standard. This analysis
would determine whether consumers of standard-compliant products would likely
pay higher prices due to manufacturers of these products facing increased costs of
accessing the standard. The Bureau would seek evidence as to the effect that royal-
ties had on standard-compliant product prices and the options that consumers could
turn to if faced with an increase in these prices.
Example 15: — Standards Development Organization with IP Disclosure

Policy
210. A private SDO is selecting a technical standard to allow the interoperability of
gizmos. Many of the alternative technologies that could be selected as the standard
are proprietary and are patented by firms in the industry who are also participants
in the SDO. Given this, the SDO has adopted an IP disclosure policy that requires
all participants to disclose any patent rights, or pending patent rights, that they have
that are essential to any of the technologies that the SDO is considering as a possi-
ble standard. Furthermore, in order for SDO participants to have assurance that
patent rights do not block access to the standard, the SDO requires that participants
also agree to license their patents on FRAND terms to all prospective licensees if
access to their proprietary technology becomes necessary to implement the stan-
dard. For added certainty, SDO participants are encouraged to specify the most
restrictive licensing terms and conditions they would demand, including the maxi-
mum royalty to license their technology. Identification of maximum royalties could
aid the SDO in selecting a standard as it allows an assessment of the relative costs
of the various technology options in addition to their technical merits.
Analysis
211. Given the situation described above, the Bureau would not view the SDO’s IP
policy as raising any issue under the Act.
212. In general, if the Bureau were to investigate SDO participants for conduct
such as the exercise of buyer power among potential licensees, the foreclosure of
innovative technologies or the restriction of access to the standard, it would pro-
ceed according to the process outlined in its CCGs. Accordingly, if the Bureau
964
determined that a SDO arrangement was to set an industry standard and there was
no evidence that the SDO was facilitating an agreement prohibited under subsec-
tion 45(1) (e.g., price fixing among IP owners or makers of products compliant to
the standard), it would not investigate SDO participants under section 45. Rather, it
would proceed, if at all, under section 90.1 according to the analytical framework
described in the CCGs.
Example 16: — Patent “Ambush”

213. Firm A is a manufacturer and seller of gizmos and is also a participant in the
SDO described in Example 15. After the SDO selects a standard for gizmo inter-
operability and firms make investments to develop gizmos that conform to the stan-
dard, Firm A launches a series of patent infringement suits against gizmo manufac-
turers that have developed products incorporating the standard by asserting patents
that it had not disclosed to the SDO but that it claims cover the gizmo interoper-
ability standard. Firm A was aware of patents implicated by the standard that it was
required to disclose pursuant to the SDO’s policy, but it did not include the patents
in its IP disclosure to the SDO. Nevertheless, Firm A wishes to be compensated for
its research efforts and is seeking damages from firms who are using the standard
without licensing the patents that it did not disclose. Gizmo manufacturers who
have been targeted by Firm A have complained to the Bureau that Firm A’s failure
to disclose and subsequent infringement actions constitute anti-competitive
Guidelines
behaviour.
Analysis
214. The Bureau would likely review Firm A’s conduct under section 79 of the
Act.
215. Given the scenario described, the Bureau’s competitive concern would be that
Firm A’s conduct enhanced its market power beyond that which was inherent in its
patents. The purpose of the IP disclosure policy was to provide the SDO with infor-
mation so that a standard could be chosen, from the various technologies that were
being considered, based on technical characteristics as well as cost. By not having
full information on relevant patents, the SDO was prevented from undertaking a
complete assessment of the potential relevant costs when it chose the standard.
Once firms have made irreversible investments in products incorporating the stan-
dard, Firm A may have increased market power to charge supra-competitive royal-
ties for its technology if it is costly for firms to abandon the standard and switch to
alternative technologies. One concern with Firm A’s conduct is that it will increase
the cost of accessing the standard for rival firms who wish to develop gizmos that
incorporate the standard and thereby reduce their incentive to innovate or produce
products that use the standard. Firm A’s conduct may result in foreclosure of rival
gizmo manufacturers. There is also concern that the increased cost of access will
result in increased prices to consumers of gizmos that incorporate the standard or
that the conduct excludes alternative technologies that would have been considered
for the standard. Finally, the Bureau would also have concerns that the conduct
965
may weaken incentives for firms to participate in procompetitive standard-setting

activity generally.
216. In identifying evidence to support the elements of section 79, the Bureau
would look to define relevant product and geographic markets. Given the competi-
tive concerns outlined above, the Bureau would define potentially relevant markets
that include the technology designated as the standard as well as gizmos and any
other products that use the standard.
217. In determining whether Firm A’s conduct was an anti-competitive act, the
Bureau would consider any legitimate business justification that Firm A may ad-
vance for its conduct. Absent a legitimate business justification, the Bureau would
likely infer from the reasonable, foreseeable consequence of Firm A’s conduct that
it was for the purpose of having an intended negative effect on competitors (firms
with technologies that are substitutes for Firm A patented technologies or rivals of
Firm A that develop gizmos incorporating the standard) that was predatory, disci-
plinary or exclusionary.
218. The Bureau would take the view that Firm A’s conduct of not disclosing cer-
tain patents in accordance with the SDO IP disclosure policy and then asserting
them against firms developing products incorporating the standard is “something
more” than the mere exercise of its patent rights. Accordingly, the Bureau would
not consider the exception in subsection 79(5) to apply, nor would it review the
matter under section 32 of the Act.
219. In determining whether Firm A’s conduct has had, is having or is likely to
have the effect of preventing or lessening competition substantially in a market, the
Bureau would look to identify whether, but for Firm A’s conduct, there would
likely be substantially greater competition in the markets where it has a competitive
concern. The Bureau would make these determinations while considering the stan-
dard-setting context, which may be characterized by irreversible investments and
high switching costs. In particular, the Bureau would examine whether Firm A’s
conduct created, preserved or enhanced its market power in a market that uses the
standardized technology. Central to this examination, the Bureau would look to
identify any alternative technologies that the SDO could have turned to at the time
the standard was being chosen. The Bureau would also look to identify any alterna-
tive technical standards or technologies that gizmo producers could turn to as a
substitute for the SDO standard after it was chosen. If such alternatives existed, the
Bureau would seek evidence on the magnitude of the switching costs that gizmo
producers would face to switch to these alternatives. If alternative technologies
would likely have been chosen as the SDO standard but for the patentee’s conduct
and if alternatives to the SDO standard did not exist, or if switching costs were
prohibitively high, the Bureau would likely conclude that Firm A increased its mar-
ket power in the market that includes the standardized technology.
220. The Bureau would also look to determine whether competition would be
harmed in the market for gizmos that implement the standard. This analysis would
determine whether consumers of gizmos would likely pay higher prices due to
manufacturers of standard-compliant gizmos facing increased costs of accessing the
standard. The Bureau would seek evidence as to the effect that royalties had on
966
gizmo prices and the options that consumers could turn to if faced with an increase
in gizmo prices.
221. If the Bureau concluded that the constituent elements of subsection 79(1) of
the Act were met, it would likely seek to negotiate a remedy with Firm A, and
failing that, bring an application to the Tribunal.
Example 17: — Reneging on a Licensing Commitment

222. Firm B is a manufacturer and seller of gizmos and is also a participant in the
SDO described in Example 15. Firm B has disclosed its relevant patents to the SDO
as well as its most restrictive licensing terms, including a commitment to a maxi-
mum royalty rate it will seek from prospective licensees if its technology is incor-
porated into the standard. Given participants’ IP disclosures, the SDO chooses a
standard that incorporates Firm B’s technology and gizmo manufacturers make ir-
reversible investments to develop gizmos conforming to the standard. Subse-
quently, gizmo producers who have developed products conforming to the standard
complain to the Bureau that Firm B is abusing its dominant position by demanding
a royalty rate in excess of the maximum it committed to in its promise to the SDO.
Analysis
223. The Bureau would likely review Firm B’s conduct under section 79 of the Act.
Guidelines
224. As in Example 16, the Bureau’s competitive concern would be that Firm B’s
conduct enhanced its market power beyond that which was inherent in its patents.
By misleading the SDO in regard to the maximum royalty it would charge to li-
cense its patents, Firm B led the SDO to select a standard with inaccurate informa-
tion as to the cost that firms would face to access that standard, which may have
impacted the SDO’s decision as to the technology to adopt as the standard and/or
firms’ decisions to invest in developing products incorporating the standard. Once
implementers of the standard made irreversible investments to develop products
incorporating the standard, Firm B gained increased market power and is able to
charge supra-competitive royalties for its technology provided that it is costly for
firms to abandon the standard and switch to alternative technologies.
225. The analysis of the elements of section 79 would be similar to that described
in Example 16. In particular, in evaluating the purpose of Firm B’s conduct to de-
termine whether it constituted a practice of anti-competitive acts, the Bureau would
consider whether there was a legitimate business justification for Firm B’s seeking
a royalty exceeding its maximum commitment. Importantly, as noted in the Bu-
reau’s Enforcement Guidelines on the Abuse of Dominance Provisions, proof of
the existence of some legitimate business purpose underlying the conduct, such as
an increased incentive for innovation, is not sufficient. The Bureau would consider
a legitimate business justification as a credible efficiency or pro-competitive ratio-
nale for the conduct, attributable to Firm B, which relates to and counterbalances
the anti-competitive effects and/or subjective intent of the acts. When assessing the
overriding purpose of Firm B’s reneging on its licensing commitment, the Bureau
would examine the credibility of any efficiency or pro-competitive claims raised by
967
Firm B, their link to the abandonment of its licensing commitment, and the likeli-
hood of these claims being achieved.
226. The Bureau would view Firm B’s conduct of committing to a maximum roy-
alty and then subsequently reneging on that commitment as “something more” than
the mere exercise of its patent rights. Accordingly, the Bureau would not consider
the exception in subsection 79(5) to apply, nor would it review the matter under
section 32.
227. If the Bureau concluded that the constituent elements of subsection 79(1) of
the Act were met, it could seek to negotiate a remedy with Firm B and failing that,
bring an application to the Tribunal. If there was private litigation involving Firm B
and participants from the SDO due to Firm B’s reneging on its royalty commit-
ment, the Bureau would use its enforcement discretion and may forbear from bring-
ing an application to the Tribunal if it determined that the remedies from the private
litigation would adequately resolve its competition concerns.
Example 18: — Seeking an Injunction after Making a Licensing Commitment

228. Consider a scenario similar to Example 17, but where Firm C (a manufacturer
and seller of gizmos) makes a FRAND licensing commitment according to the
SDO policy and the SDO ultimately adopts a standard for which Firm C’s patented
technology is essential. Subsequently, however, Firm C faces difficulties in reach-
ing agreement with willing licensees on terms and conditions for licensing, includ-
ing acceptable royalties. To protect the patents that it views as being used without
adequate compensation, Firm C seeks injunction orders against several firms that
have made investments to develop and sell competing gizmos that implement the
standard. The Bureau receives complaints that Firm C is abusing its dominant posi-
tion by seeking injunctions when it had committed to license its patents on FRAND
terms.
Analysis
The Bureau would likely review Firm C’s conduct under section 79 of the Act.
229. The Bureau’s competitive concern would be that Firm C’s licensing commit-
ment served to provide assurance to the SDO and other gizmo manufacturers that
they would have access to the standard if they incorporated Firm C’s technology.
This commitment, in part, motivated the SDO to include Firm C’s technology in
the standard, and/or encourage firms to make irreversible investments to develop
gizmos based on the standard. By seeking an injunction against firms that are
“locked in” to the standard and that face prohibitive costs to switch to alternative
technologies, Firm C can “hold up” potential licensees and demand higher royalties
than if it did not seek the injunction. The use of injunctions can be particularly
problematic when Firm C’s patented technologies comprise only a small part of the
standard but can nonetheless block a prospective licensee’s ability to manufacture
and sell gizmos. Given the significant risk to its business, a prospective licensee
that is threatened by an injunction may be compelled to pay a non-FRAND royalty
rate. The Bureau’s concern with Firm C’s conduct is similar to the concern with
Firm A’s conduct in Example 16.
968
230. The Bureau would take the view that by making a FRAND licensing commit-
ment and then seeking an injunction against willing licensees of its technology,
Firm C is engaging in “something more” than the mere exercise of its patent rights.
Accordingly, the Bureau would not consider the exception in subsection 79(5) to
apply, nor would it review the matter under section 32 of the Act.
231. The Bureau recognizes that a firm’s commitment to license on FRAND terms
does not mean that it is committing to license on a royalty-free basis. Firms may
make large investments in research and development and are entitled to seek royal-
ties to recover the value of their investment. Potential licensees may seek to take
advantage of FRAND commitments by “holding out” for a particular royalty or
simply by not undertaking licensing negotiations in good faith. Because of this po-
tential problem, in its inquiry to determine the underlying purpose for Firm C seek-
ing the injunction (whether seeking the injunction was, or was part of, a practice of
anti-competitive acts under paragraph 79(1)(b)), the Bureau would examine any
legitimate business justification and look for evidence to determine whether the
potential licensee was willing to enter into negotiations and pay a FRAND rate.
The Bureau accepts that in certain circumstances it may be appropriate for a firm
that has made a FRAND licensing commitment to seek an injunction against an
infringing party. Circumstances where the Bureau would conclude that the seeking
of an injunction could be appropriate include:
i. when a prospective licensee refuses to pay a royalty that is determined to be
Guidelines
FRAND by a court or arbitrator;
ii. when a prospective licensee refuses to engage in licensing negotiations;
iii. when a prospective licensee constructively refuses to negotiate (for exam-
ple, by insisting on terms clearly outside the bounds of what could be consid-
ered to be FRAND terms) or
iv. when a prospective licensee has no ability to pay damages (for example, a
firm that is in bankruptcy).
232. In determining whether Firm C’s conduct of making a licensing commitment
and seeking an injunction has had, is having or is likely to have the effect of
preventing or lessening competition substantially in a market, the Bureau would
look to identify whether, but for Firm C’s conduct, there would likely be substan-
tially greater competition in the markets where it has a competitive concern. This
analysis would be similar to that described in Example 16.
233. If the Bureau concluded that the constituent elements of section 79(1) of the
Act were met, it would likely seek to negotiate a remedy with Firm C and failing
that, bring an application to the Tribunal.
Full citations of judicial decisions

Apotex Inc. v. Eli Lilly and Co.:
Apotex Inc. v. Eli Lilly and Co., [2005] F.C.J. No. 1818 (F.C.A.)
969
Laidlaw:
Canada (Director of Investigation and Research) v. Laidlaw Waste Systems
Ltd. (1992), 40 C.P.R. (3d) 289 (Comp. Trib.)
Nielsen:
Canada (Director of Investigation and Research) v. D&B Companies of
Canada Ltd. (1995), 64 C.P.R. (3d) 216 (Comp. Trib.)
Nova Scotia Pharmaceutical Society:
R. v. Nova Scotia Pharmaceutical Society, [1992] 2 S.C.R. 606
NutraSweet Co.:
Canada (Director of Investigation and Research) v. The NutraSweet Co.
(1990), 32 C.P.R. (3d) 1 (Comp. Trib.)
Southam Inc.:
Canada (Director of Investigation and Research) v. Southam Inc. (1992), 47
C.P.R. (3d) 240 (Comp. Trib.); rev’d (1995), 63 C.P.R. (3d) 67 (F.C.A); rev’d
(1997), 71 C.P.R. (3d) 417 (S.C.C.).
Stargrove Entertainment Inc. v. Universal Music Publishing Group Canada et al.:
Stargrove Entertainment Inc. v. Universal Music Publishing Group Canada et
al. (2015), CT-2015-009 (Comp. Trib.)
Tele-Direct:
Canada (Director of Investigation and Research) v. Tele-Direct (Publications)
Inc. and Tele-Direct (Services) Inc. (1997), 73 C.P.R. (3d) 1 (Comp. Trib.)
TREB:
The Commissioner of Competition v The Toronto Real Estate Board, 2016
Comp Trib 7
Warner:
Canada (Director of Investigation and Research) v. Warner Music Canada
Ltd. (1997), 78 C.P.R. (3d) 321 (Comp. Trib.)
970
INTERNATIONAL COMPETITION NETWORK’S
RECOMMENDED PRACTICES FOR MERGER
NOTIFICATION PROCEDURES
I. — Definition of a Merger Transaction
A. — Jurisdictions should consider carefully the types of transactions
that are included within the scope of their merger laws and seek to
include in the scope of their merger laws only transactions that
result in a durable combination of previously independent entities or
assets and are likely to materially change market structure
Working Group Comments
Original Comments (May 2017)
Comment 1: Jurisdictions should not include in the scope of their merger laws
transactions that are unsuitable for merger review. This applies, for example, to
cooperative arrangements that can be reversed easily by the parties’ future indivi-
dual decisions, and other non-durable arrangements.
Comment 2: Group-internal or intra-person restructuring should not be included
within the scope of merger review as it has no effect on market structure.
ICN RPs
Comment 3: Acquisitions of a minority interest should not be included in the scope
of merger review if they are unlikely to be competitively significant.
Comment 4: Jurisdictions may consider using exemptions to exclude from merger
review transactions that, because of their nature, are unlikely to have durable ef-
fects on competition.
B. — Jurisdictions should use clear definitions to identify transactions

that fall within the scope of their merger laws. Such definitions may
refer to categories of transactions, such as share acquisitions and
acquisitions of assets, and/or to broader concepts, such as the
acquisition of “control” or of a “competitively significant influence,”
as defined by the reviewing jurisdiction
Original Comments (May 2017)
Comment 1: When defining what types of share acquisitions are within the scope of
merger laws, jurisdictions may establish objective, numerical thresholds, such as
the acquisition of at least 25% or 50% of voting or equity rights in another entity.
971
ICN’s Recommended Practices for Merger Notification Procedures
Comment 2: Jurisdictions should seek to clearly define in what circumstances asset

acquisitions are considered sufficiently material to merit inclusion within the scope
of their merger laws. The definition should screen out asset acquisitions that are
unlikely to affect competition.
Comment 3: Jurisdictions may also rely on broader concepts, such as the acquisi-
tion of “control” or of a “competitively significant influence” to determine what
transactions are within the scope of their merger laws. If so, they should seek to
maximize legal certainty and predictability, in particular through a consistent and
transparent decision making practice, and the use of guidelines or informal
guidance.
Comment 4: Some jurisdictions may find it necessary to adopt a separate definition
of joint ventures or acquisitions of interests in partnerships that fall within the
scope of their merger laws. In this case, jurisdictions should use clear and predict-
able criteria to distinguish those transactions that are subject to merger review from
those that are not.
II. — Nexus to Reviewing Jurisdiction

A. — Jurisdiction should be asserted only over transactions that have
a material nexus to the reviewing jurisdiction
Original Comments (September 2002)
Amended (May 2017)
Comment 1: Jurisdictions are sovereign with respect to the application of their own
laws to mergers. In exercising that sovereignty, however, jurisdiction should be
asserted only with respect to those transactions that have a material nexus to the
reviewing jurisdiction.
Comment 2: Jurisdictions may limit the competition authority’s ability to review
and challenge mergers to those transactions that meet the mandatory notification
thresholds. This approach provides legal certainty to the parties.
Comment 3: Jurisdictions may retain the ability to review transactions that do not
meet the mandatory notification thresholds. Such “residual jurisdiction” may en-
compass all transactions with a material nexus to the jurisdiction or a subset of
transactions with a material nexus to the jurisdiction that meet lower, non-
mandatory notification thresholds. When a jurisdiction maintains residual jurisdic-
tion, it should take steps to address the desire of the parties to the transaction for
certainty. Such steps may include restricting the competition authority’s ability to
exercise residual jurisdiction to a specified, limited period of time after the comple-
tion of a transaction and authorizing the parties to submit voluntary notifications to
the competition authority.
Comment 4: Jurisdictions may choose not to have mandatory notification thresh-
olds and, instead, allow for voluntary notifications of proposed transactions. In
these voluntary systems, jurisdictions may employ thresholds, either to provide gui-
dance to the parties as to which transactions are viewed as likely to raise potential
972
competition concerns and therefore should be notified or to limit the transactions

that the competition authority can review. Jurisdictions employing a voluntary
merger notification system should take steps to address the desire of the parties to
the transaction for certainty.
B. — Merger notification thresholds should incorporate appropriate

standards ensuring a material nexus to the reviewing jurisdiction
Amended (May 2017)
Comment 1: In establishing merger notification thresholds, each jurisdiction should
seek to screen out transactions that are unlikely to result in appreciable competitive
effects within its territory. Requiring merger notification as to such transactions
imposes unnecessary transaction costs and commitment of competition agency re-
sources without a corresponding enforcement benefit. Merger notification thresh-
olds should therefore incorporate a material nexus requirement. A material nexus to
the reviewing jurisdiction is present when a proposed transaction has a significant
and direct economic connection to the jurisdiction. The most common means of
providing for a material nexus is by requiring significant local sales or local asset
levels in the merger notification thresholds.1
Comment 2: Jurisdictions may supplement their material nexus thresholds with ad-
ditional, ancillary thresholds, but those thresholds alone should not be sufficient to
trigger a merger notification requirement in the absence of a material nexus to the
reviewing jurisdiction. Examples of such additional and cumulative screens include
thresholds based on the worldwide activities of the parties or the value of the ICN RPs
transaction.
Comment 3: Merger notification thresholds should provide that the material nexus
to the reviewing jurisdiction be based on the entities or businesses that will be com-
bined in the proposed transaction. In particular, the relevant sales and assets of the
acquired party should be limited to the sales and assets of the business(es) that are
being acquired (often referred to as the “target”). The sales and assets of the selling
group or the selling party that are not being transferred to the acquiring party
should not be considered in applying the merger notification thresholds.
1 As of the drafting of this revised recommended practice, some jurisdictions are examining
or have examined whether certain high value transactions involving targets with no or low
local sales may have a significant impact on competition in the jurisdiction and, if so,
whether to modify their merger notification thresholds to address this limited class of trans-
actions, with certain jurisdictions introducing supplementary thresholds to this end. Any
such modifications to notification thresholds should ensure, inter alia, that the new thresh-
olds are clear and understandable and that the transaction has a material nexus to the juris-
diction. It is premature to consider changes to these recommended practices in this light.
973
Comment 4: Jurisdictions should periodically review their merger notification

thresholds to determine whether to modify them based on knowledge gained
through the application of the thresholds, experiences of other jurisdictions, input
from stakeholders, and other pertinent developments.
C. — Determination of a transaction’s nexus to the reviewing

jurisdiction should be based on activities within that jurisdiction as
measured by reference to the activities of at least two parties to the
transaction in the local territory and/or by reference to the activities
of the acquired business in the jurisdiction
Amended (June 2003, May 2017)
Comment 1: Notification should not be required unless the transaction has a mate-
rial nexus to the reviewing jurisdiction. This criterion may be satisfied if each of at
least two parties to the transaction have significant local activities. Alternatively,
this criterion may be satisfied if the acquired business has a significant presence in
the local territory, such as significant local assets or sales in or into the reviewing
jurisdiction.
Comment 2: Many jurisdictions require significant local activities by each of at
least two parties to the transaction as a prerequisite for mandatory merger notifica-
tion. This approach represents an appropriate material nexus screen since the likeli-
hood of adverse effects from transactions in which only one party has a significant
local presence is sufficiently remote that the burdens associated with notification
are normally not warranted. As previously discussed, in the case of a proposed ac-
quisition, one of the two parties should be the acquired business (“target”) and the
relevant activities of the acquired party should be limited to the sales or assets of
the business(es) being acquired in the proposed transaction.
Comment 3: In transactions involving more than two parties, application of the
“each of at least two parties” threshold approach should be adapted to the type of
transaction to ensure that notification is required only when the transaction has a
material nexus to the reviewing jurisdiction. An important example is the formation
of a joint venture. Even if two or more of the parties forming the joint venture have
significant activities in the jurisdiction, the proposed joint venture transaction is
unlikely to have a material nexus to the jurisdiction unless the proposed joint ven-
ture will have significant assets in or sales in or into the reviewing jurisdiction.
Comment 4: A transaction in which the acquiring party lacks significant local activ-
ities is less likely to have adverse effects within the jurisdiction than a transaction
in which both the acquiring party and the acquired business have significant local
activities. Therefore, jurisdictions with notification thresholds based solely on the
activities of the acquired business should set their thresholds at a substantially
higher level to ensure that the transaction has a material nexus to the reviewing
jurisdiction.
974
Comment 5: Notification should not be required solely on the basis of the acquiring
firm’s local activities, for example, by reference to a combined local sales or local
assets test that may be satisfied by the acquiring entity alone irrespective of any
significant local activity by the business to be acquired.
D. — Notification thresholds should be clear and understandable

Amended (May 2017)
Comment 1: Clarity and simplicity are essential features of well-functioning notifi-
cation thresholds. Given the increasing number of multi-jurisdictional transactions
and the growing number of jurisdictions with merger notification requirements, the
business community, competition authorities, and the efficient operation of capital
markets are best served by clear, understandable, and easily administrable “bright-
line” tests.
Comment 2: Competition authorities can assist parties by providing publicly availa-
ble written guidance on the application of their merger notification thresholds and
by enabling parties to obtain guidance by contacting the staff of the authority to
discuss the application of the notification thresholds.
E. — Mandatory notification thresholds should be based on objectively

quantifiable criteria
Original Comments (September 2002) ICN RPs
Amended (May 2017)
Comment 1: Mandatory notification thresholds should be based exclusively on ob-
jectively quantifiable criteria. Examples of objectively quantifiable criteria are as-
sets and sales (or turnover). Examples of criteria that are not objectively quantifi-
able are market share and potential transaction-related effects. Market share-based
tests and other criteria that are inherently subjective and fact-intensive may be ap-
propriate for later stages of the merger control process (e.g., determining the scope
of information requests or the ultimate legality of the transaction), but such tests are
not appropriate for use in making the initial determination as to whether a transac-
tion requires notification.
Comment 2: The specification of objective criteria will require a jurisdiction to ex-
plicitly identify several elements. First, the jurisdiction must identify the measure-
ment tool — e.g., assets or sales. Second, the jurisdiction must identify the scope of
the geographic area to which the measurement tool is applied — e.g., national or
worldwide. Third, the jurisdiction must specify a time component. In the case of
certain measurement tools, such as revenues, sales, or turnover, the time component
will be a period over which the measurement should be taken — e.g., a calendar
year. In the case of other measurement tools, such as assets, the time component
will be a particular date as of which the measurement should be taken. In either
975
case, the above-referenced criteria may be defined by reference to pre-existing, reg-

ularly-prepared financial statements (such as annual statements of income and ex-
pense or year-end balance sheets).
Comment 3: The specified criteria should be defined in clear and understandable
terms, including appropriate guidance as to included and/or excluded elements,
such as taxes and intra-company transfers (as to sales), depreciation (as to assets),
and material events or transactions that have occurred after the last regularly-pre-
pared financial statements. Guidance should also be given as to the proper geo-
graphic allocation of sales and/or assets. To facilitate the parties’ ability to gather
multi-jurisdictional data on a consistent basis, jurisdictions should seek to adopt
uniform definitions or guidelines with respect to commonly used criteria.
Comment 4: In jurisdictions utilizing a voluntary notification system, notification
thresholds serve as a means to provide guidance as to which transactions are
viewed as likely to raise potential competition concerns and therefore are appropri-
ate for notification to the reviewing jurisdiction. Since such notification thresholds
are a starting point for identifying potential competition concerns, it can be appro-
priate for voluntary notification thresholds to utilize guidance based on market
share information or other more subjective criteria. However, when voluntary noti-
fication thresholds are used to determine whether the competition authority has ju-
risdiction to review the transaction or to provide safe harbors, competition authori-
ties should use objective criteria or provide guidance to assist parties in
determining which transactions meet the thresholds or qualify for the safe harbor
protection.
F. — Mandatory notification thresholds should be based on

information that is readily accessible to the parties to the proposed
transaction
Amended (May 2017)
Comment 1: The information needed to determine whether notification thresholds
are met should normally be of the type that is available to the parties in the ordinary
course of business.
Comment 2: Notwithstanding Comment 1, the parties can reasonably be required to
report their revenues or assets by jurisdiction even if they do not maintain data in
that form in the ordinary course of business. As previously discussed, however,
parties should be given appropriate guidance as to the methodology to be applied in
developing the specified data. This is particularly important where information
must be reported in a manner that is not consistent with a party’s normal business
practices.
Comment 3: Local currency values will generally be superior to other economic
measures for purposes of establishing financial criteria in notification thresholds —
parties are more likely to maintain their financial data in the ordinary course by
reference to currency values, and published data relating to currency values are
976
generally readily accessible and available through standard international sources. It

is recognized, however, that jurisdictions facing volatile local currency fluctuation
may need to adopt more dynamic economic measures, such as monthly wage multi-
ples. The general preference for local currency values is not intended to preclude a
jurisdiction from expressing financial criteria in its notification thresholds by refer-
ence to a generally-recognized global trading currency if it chooses to do so. In all
events, however, the relevant criteria should be clearly defined (including applica-
ble rules pertaining to currency conversion), transparent, and readily accessible by
parties whether or not domiciled in the local jurisdiction.
III. — Timing of Notification

A. — Parties should be permitted to notify proposed mergers upon
certification of a good faith intent to consummate the proposed
transaction
Comment 1: Parties should be permitted to notify transactions without undue delay.
This will allow parties to make filings at the time they deem most efficient and
facilitate coordination of multi-jurisdictional filings. Competition agencies should
not, however, be required to accept filings with respect to transactions that are
merely speculative, and parties may therefore reasonably be required to submit
some appropriate indicia that they intend to proceed with the transaction as a pre-
condition for filing notification. Competition agencies may also condition accept-
ance of filing upon publication of the fact of such filing or otherwise complying
with the jurisdiction’s public disclosure requirements. ICN RPs
Comment 2: Jurisdictions differ considerably in their practices as to when parties
are permitted to submit their formal notification. Convergence of these practices
can be a way of promoting greater efficiency in the coordination of the multi-juris-
dictional review process. Certain jurisdictions do not permit formal notification un-
til a definitive agreement has been executed. Other jurisdictions permit filing on the
basis of a letter of intent, agreement in principle or public announcement of the
intention to make a tender offer (with some jurisdictions also requiring an express
certification by the notifying party or parties of a good faith intention to consum-
mate the notified transaction), and these jurisdictions have found that this practice
has not resulted in a significant incidence of speculative notifications. The cost (in-
cluding filing fees), information-gathering burdens and potential for public disclo-
sure associated with the notification process also have a natural tendency to inhibit
parties from notifying merely speculative transactions.
Comment 3: In determining when notification will be permitted, jurisdictions may
consider whether requests for confidentiality during the review period will impede
the competition agency’s ability to conduct an effective investigation (as, for exam-
ple, by contacting third parties) or otherwise conflict with applicable public disclo-
sure requirements in the jurisdiction concerned.
977
Comment 4: Where formal notification is not permitted until a definitive agreement

is in place, competition agencies should accord the parties the opportunity for con-
fidential pre-notification consultations to present and discuss the proposed transac-
tion in advance in order to facilitate timely submission and review of the formal
notification. In addition, the standards for determining when a “definitive agree-
ment” has been reached should be clearly defined so that the parties can determine
when their notification will be accepted for filing.
B. — Jurisdictions that prohibit closing while the competition agency

reviews the transaction or for a specified time period following
notification should not impose deadlines for pre-merger notification
Comment 1: Notification regimes differ substantially in terms of the nature and
volume of information that must be submitted at the time a transaction is notified,
and there will be circumstances in which it will take parties substantial time to
prepare the necessary submissions after they have reached an agreement. Jurisdic-
tions that prohibit closing until there has been an opportunity for the competition
agency to review the transaction should not impose a deadline upon the parties to
file notification within a specified time after reaching an agreement. Parties will
have the incentive to file promptly after reaching an agreement because they know
they will be unable to close their transaction until it has been reviewed. Elimination
of filing deadlines will also facilitate the coordination of multi-jurisdictional filings
and reviews.
C. — Jurisdictions that do not prohibit closing pending review by the

competition agency should nevertheless allow parties a reasonable
time in which to file notification following a clearly defined triggering
event
Comment 1: Certain jurisdictions require notification of transactions but do not pro-
hibit the parties from closing pending competition agency review (so-called “non-
suspensive jurisdictions”). Such jurisdictions have a legitimate basis for requiring a
filing within a timeframe that will permit the competition agency to conduct a
timely review. Where notification is required within a specified period following a
triggering event, such period should accord the parties a period of time to prepare
the necessary submissions that is reasonable in view of the information require-
ments to be satisfied.
Comment 2: The triggering event for purposes of calculating the filing deadline
should be clearly defined so as to permit the parties to determine the timing of their
notification obligation in a definitive manner. The triggering event should also be
defined so as to avoid imposing mandatory notification requirements with respect
to proposed transactions that have not yet reached an appropriate level of develop-
978
ment in the negotiation process. This will avoid premature filing requirements and
thereby promote the efficient allocation of enforcement resources and avoid impos-
ing unnecessary costs and burdens on parties contemplating (but not yet fully com-
mitted to) a possible transaction.
IV. — Review Periods

A. — Merger reviews should be completed within a reasonable period
of time
Original Comments (June 2003)
Comment 1: Merger transactions may present complex legal and economic issues.
In such cases, competition agencies need sufficient time to properly investigate and
analyze them in order to reach a well-informed decision. At the same time, merger
transactions are almost always time sensitive, and the completion of merger re-
views by relevant competition agencies is often a condition to closing either by
operation of law or contract. Delay in the completion of such reviews may give rise
to a number of risks. Delay may jeopardize the consummation of the transaction
itself due to intervening developments and/or other time-sensitive contingencies
such as financing arrangements. Delay may also have an adverse impact on the
merging parties’ individual transition planning efforts and on their ongoing busi-
ness operations due to work force attrition and marketplace uncertainty. In addition,
it defers the realization of any efficiencies arising from the transaction. Merger re-
views should therefore be completed within a reasonable time frame. A reasonable
period for review should take into account, inter alia, the complexity of the transac-
tion and possible competition issues, the availability and difficulty of obtaining in- ICN RPs
formation, and the timeliness of responses by the merging parties to information
requests.
Comment 2: Many jurisdictions (so-called “suspensive jurisdictions”) prohibit the
consummation of notified transactions pending the expiration or early termination
of specified “waiting periods.” In so-called “non-suspensive jurisdictions,” the par-
ties are permitted to close notified transactions pending review by the competition
agencies. Merging parties may voluntarily defer closing in non-suspensive jurisdic-
tions, however, in the interest of achieving legal certainty. In some instances, re-
ceipt of all required regulatory approvals may also be a condition to obtaining fi-
nancing, completing company law formalities or other matters necessary to allow
the transaction to proceed. Accordingly, merger reviews should be completed
within a reasonable time frame in both suspensive and non-suspensive jurisdictions.
Comment 3: Completion of merger reviews within a reasonable time frame in non-
suspensive jurisdictions also promotes more effective enforcement because the pas-
sage of time may render it more difficult for the competition agency to obtain ef-
fective post-closing remedies.
979
B. — Merger review systems should incorporate procedures that

provide for expedited review and clearance of notified transactions
that do not raise material competitive concerns
Comment 1: Given that the vast majority of notified transactions do not raise mate-
rial competitive concerns, merger review systems should be designed to permit
such transactions to proceed expeditiously. Many jurisdictions achieve this objec-
tive by employing review procedures that allow such non-problematic transactions
to proceed following a preliminary review undertaken during an abbreviated initial
review period, and subjecting only transactions that raise material competitive con-
cerns to more extended review periods.
Comment 2: In some merger review systems, the initial review period is referred to
as “Phase I,” while the extended review period is referred to as “Phase II.” Other
jurisdictions employ single phase or multi-phase review procedures that likewise
permit — transactions that do not present material competitive concerns to proceed
expeditiously following an abbreviated review and/or waiting period.
C. — In suspensive jurisdictions, initial waiting periods should expire

within a specified period following notification and any extended
waiting periods should expire within a determinable time frame
Comment 1: In suspensive jurisdictions, the parties’ ability to lawfully consummate
notified transactions is dependent upon the expiration of applicable waiting periods.
Accordingly, initial waiting periods should be subject to definitive and readily-as-
certainable deadlines to permit transactions that do not present material competitive
concerns to proceed with minimal delay and disruption. While certain transactions
will require more extended reviews, waiting periods associated with such reviews
should expire within determinable time frames, whether measured from the date of
the initial filing, the commencement of “Phase II” or similar proceedings, or from
the merging parties’ submission of information the competition agency requires to
complete the extended review.
Comment 2: To facilitate coordinated reviews and clearances, jurisdictions should
seek convergence of their waiting periods with the time frames commonly used by
competition agencies internationally. Thus, initial waiting periods should expire in
six weeks or less, and extended or “Phase II” reviews should be completed or capa-
ble of completion within six months or less following the submission of the initial
notification(s).
Comment 3: Uncertainty with respect to applicable waiting periods can be avoided
only if the parties can readily ascertain the commencement and the anticipated ex-
piration dates thereof. Competition agencies should therefore provide notifying par-
ties with timely notice as to any deficiencies in their submissions, and should in-
980
form the parties of the specific details of any such deficiencies to facilitate the
prompt submission of corrective filings. In those jurisdictions where requests for
additional information have the effect of automatically interrupting or suspending
the waiting period, competition agencies should seek to consolidate information
requests in order to increase the predictability of the anticipated duration of the
waiting period.
Comment 4: Parties should be free to consummate properly notified transactions
upon the expiration of specified waiting periods unless the competition agency
takes formal action to extend the waiting period (as, for example, by initiating
Phase II proceedings), to impose conditions to closing, or to prohibit or enjoin the
transaction. In certain jurisdictions, the expiration of applicable waiting periods
does not bar subsequent challenge by the competition agency, but parties are never-
theless legally permitted to consummate transactions following such expiration.
Comment 5: The existence of specified waiting periods should not preclude compe-
tition agencies from granting early termination once they determine that a proposed
transaction does not raise material competitive concerns. Accordingly, each juris-
diction’s procedures should enable the competition agency to grant early termina-
tion of applicable waiting periods.
Comment 6: In certain situations, the specified waiting periods may not be suffi-
cient for the competition agency to reach a determination. Additional time may be
needed, for example, for particularly complex transactions and/or to finalize mutu-
ally acceptable conditions for clearance. To accommodate these situations, proce-
dures should be sufficiently flexible to allow for a limited extension, with the con-
sent of the notifying party(ies), of applicable waiting periods to avoid the initiation
of Phase II proceedings and/or an adverse enforcement decision where such a result
might be avoided by a limited extension. Competition agencies should not invite or ICN RPs
encourage such extensions unless there is reason to believe that the extension may
avoid a more protracted, formal extension of the waiting period and/or an adverse
enforcement decision.
D. — In non-suspensive jurisdictions, initial merger reviews should be

completed within a specified period following notification and any
extended reviews should be completed within a determinable time
frame
Comment 1: Although merging parties are not legally prohibited from consummat-
ing transactions following notification in non-suspensive jurisdictions, the pen-
dency of review may nevertheless impact the parties’ practical ability and/or will-
ingness to close prior to competition agency clearance. As a consequence, many of
the same timing considerations discussed in the Comments to Recommended Prac-
tice C with respect to waiting periods in suspensive jurisdictions are also applicable
with respect to review periods in non-suspensive jurisdictions.
981
Thus, inter alia, initial review periods should be subject to definitive and readily-
ascertainable deadlines to facilitate clearance of transactions that do not present
material competitive concerns with minimal delay and disruption, and extended re-
view periods should be subject to determinable deadlines.
Comment 2: Non-suspensive jurisdictions should likewise seek convergence of
their review periods with time frames typically used by competition agencies inter-
nationally to facilitate coordinated reviews and clearances. Thus, initial reviews in
non-suspensive jurisdictions should be completed in six weeks or less, and ex-
tended or “Phase II” reviews should be completed or capable of completion within
six months or less following the submission of the initial notification(s).
E. — Jurisdictions should adopt appropriately tailored procedures to

accommodate particular circumstances associated with non-
consensual transactions and sales in bankruptcy
Comment 1: Notification procedures designed primarily to cover negotiated trans-
actions may be ill-suited for non-consensual transactions such as public bids and
tender offers. In such transactions, the acquired firm may be apathetic or even hos-
tile to the proposed transaction and correspondingly disinclined to cooperate in any
applicable notification and review process. These difficulties may be especially
pronounced in jurisdictions where notifications must be filed by both the acquiring
and acquired persons or where joint notification is required. Non-consensual trans-
actions may also be particularly time-sensitive due to applicable company or secur-
ities law deadlines and the possibility of competing, and potentially non-reportable,
bids. Jurisdictions should adopt appropriately tailored procedures to take the partic-
ularized nature of these transactions into account. For example, jurisdictions have
variously adopted the following measures designed to address specific issues raised
by non-consensual transactions: shortened review periods (or, where applicable,
waiting periods); permitting the applicable initial review period to commence upon
filing by the acquiring party only (where filings by both the acquiring and acquired
parties are normally required); discretionary waivers of information requirements
relating to the target company in hostile situations; and/or discretionary derogations
permitting the implementation of the bid during the review period, provided that
the acquiring person does not exercise voting rights or does so only to maintain the
full value of the shares.
Comment 2: Jurisdictions should consider adopting procedures for accelerated re-
view of transactions involving sales of companies in financial distress which are
subject to court-supervised processes (e.g., bankruptcy or similar restructuring).
The risks associated with the potential deterioration of the assets of such firms sug-
gest that expedited review and/or waiting periods should be considered, whether by
means of particularized rules or discretionary early termination. Non-consensual
sales by trustees in bankruptcy also may raise the difficulties set forth in the pre-
ceding Comment.
982
V. — Requirements for Initial Notification

A. — Initial notification requirements should be limited to the
information needed to verify that the transaction exceeds
jurisdictional thresholds, to determine whether the transaction
raises competitive issues meriting further investigation, and to take
steps necessary to terminate the review of transactions that do not
merit further investigation
Comment 1: Because most transactions do not raise material competitive concerns,
the initial notification should elicit the minimum amount of information necessary
to initiate the merger review process. It should be used to collect information to
verify that the transaction is properly before the competition agency in light of ap-
plicable jurisdictional requirements and notification thresholds and to determine
whether the transaction raises competitive issues meriting further investigation. The
initial notification also may be used to collect information that the competition
agency needs for a clearance decision or to prepare other documentation required to
terminate the review process.
Comment 2: The amount of information required in the initial notification may vary
depending on the approach to notification thresholds taken by the jurisdiction. Ju-
risdictions that review transactions of limited value, transactions with limited local
nexus, or large numbers of transactions due to low jurisdictional thresholds should
be particularly sensitive to any disproportionate burdens arising from the breadth of
their initial filing requirements.
ICN RPs
B. — Initial notification requirements and/or practices should be
implemented so as to avoid imposing unnecessary burdens on
parties to transactions that do not present material competitive
concerns
Comment 1: Because the duty to notify applies to transactions covering a wide
range of possible competitive effects, no single set of initial notification require-
ments will be optimal for all transactions. To enable the competition agency to
accomplish its mission without imposing unnecessary burdens on merging parties,
jurisdictions should adopt mechanisms that allow for flexibility in the content of
the initial notification and/or with respect to additional information requirements
during the initial phase of the review.
Comment 2: There are various ways to provide flexibility in the initial review.
Many jurisdictions use one or more of the following:
• Alternative notification formats — different initial notification formats vary-
ing with the likely complexity of competitive analysis of the transaction; ex-
amples include: (a) advance ruling certificates, which enable the merging par-
983
ties to use a simplified advance procedure instead of a formal notification; and

(b) short and long form notification options, enabling the merging parties to
elect to submit abbreviated information in transactions that do not present ma-
terial competitive concerns.
• Discretionary waiver — extensive initial notification requirements coupled
with procedures providing competition agency staff discretion to waive re-
sponses to information specifications that are not sufficiently relevant to the
agency’s disposition of the transaction to justify the burden that the responses
would impose.
• Discretionary supplementation — abbreviated initial notification requirements
coupled with procedures providing competition agency staff discretion to seek
additional information during the initial review period.
Comment 3: Whichever mechanisms are used to provide flexibility, competition
agencies should seek to limit the information sought from parties to transactions
that do not appear to present material competitive concerns. It is, however, legiti-
mate for competition agencies to require the merging parties to provide information
sufficient to demonstrate that the transaction does not present such concerns. At the
same time, competition agencies should be flexible as to formal requirements
where the merging parties are able to demonstrate the absence of material competi-
tive concerns by reference to objectively quantifiable information maintained in the
ordinary course of business, as opposed to the detailed market information some-
times required upon notification.
Comment 4: Competition agencies that use discretionary supplementation should
consider providing guidance on the types of information (e.g., business reports and
plans, transaction documents, customer lists) that they commonly request for the
purpose of determining whether a transaction presents material competitive
concerns.
Comment 5: Competition agencies are entitled to expect notifications to contain
specific original material relating to their jurisdiction. Where a jurisdiction’s notifi-
cation requirements specify the format in which information is to be submitted, the
competition agency should consider accepting substantially responsive information
in a different format prepared by parties in the ordinary course of business or for
submission to another jurisdiction. Examples of circumstances in which such con-
sideration might be warranted include: (a) where parties that maintain records on a
fiscal year basis are notifying in a jurisdiction that ordinarily requires calendar year
data; and (b) where parties that maintain data on a geographic basis that does not
conform precisely to the format required by the notification form of the jurisdiction
concerned.
Comment 6: Competition agencies should allow merging parties voluntarily to pro-
vide information beyond that required in the initial filing to assist the agencies in
narrowing or resolving potential competitive concerns or engaging in a focused in-
quiry into such issues.
984
C. — Competition agencies should provide for the possibility of pre-

notification guidance to parties on the notifiability of the transaction
and the content of the intended notification
Comment 1: It is generally in the interest of competition agencies and merging par-
ties to clarify the legal and factual issues related to the notification of intended
transactions as early as possible. Guidance is likely to be particularly valuable for
transactions that present complex jurisdictional or competition issues. Jurisdictions
should consider making available pre-notification consultations upon the request of
the merging parties in order to advise the parties on whether their transaction will
be subject to notification obligations and, if so, what information will be needed for
their intended notification.
Comment 2: In jurisdictions that use discretionary waiver as a mechanism for flexi-
bility, pre-notification consultations should provide merging parties with the oppor-
tunity to seek a waiver of the obligation to produce requested information on the
grounds that the burden of compiling and submitting the information outweighs its
value the competition agency.
D. — Jurisdictions should limit translation requirements and formal

authentication burdens
Comment 1: While it is appropriate for jurisdictions to require notifications to be in ICN RPs
an official language (although they may choose to accept them in additional lan-
guages), they should not require extensive translation of supporting documents,
such as transactional materials and annual reports, submitted as part of the notifica-
tion. Competition agencies should accept translated summaries, excerpts, and other
means of reducing translation burdens, without prejudice to their ability to require
full translations if the transaction appears to present competitive concerns.
Comment 2: Jurisdictions are entitled to reasonable assurance of the validity of no-
tifications and supporting information. These assurances can and ordinarily should
be achieved without requiring the parties’ senior officials to provide for notariza-
tion or consularization personally. Many jurisdictions allow notification to be per-
fected based on representations by counsel or simple signatures of company per-
sonnel. Jurisdictions that require formal authentication should allow notification to
be perfected on the basis of an appearance by duly authorized persons residing in
the jurisdiction.
985
VI. — Conduct of Merger Investigations

A. — Merger investigations should be conducted in a manner that
promotes an effective, efficient, transparent and predictable merger
review process
Original Comments (April 2004)
Comment 1: Effectiveness, efficiency, transparency and predictability are funda-
mental attributes of a sound merger control regime, and these objectives should be
pursued at all stages of the merger review process. During the investigative stage,
achieving these objectives can be facilitated by adopting procedures that address
recurring issues encountered by the competition agency and merging parties in the
merger review process and by adopting practices designed to focus the investiga-
tion on relevant legal and factual issues as promptly as possible and to resolve any
perceived competitive concerns expeditiously.
Comment 2: These objectives can best be achieved if there is a frank and open
dialogue between the competition agency and the merging parties. The cooperation
of the merging parties is a key factor in the competition agency’s ability to pursue
these objectives most effectively.
B. — Merger investigation procedures should include opportunities for

meetings or discussions between the competition agency and the
merging parties at key points in the investigation
Comment 1: The competition agency should be available for consultation with the
merging parties to inform them of any significant legal or practical issues that arise
during the course of the investigation. Although scheduling meetings may not be
necessary in non-complex cases, in appropriate cases merging parties should be
afforded an opportunity to meet with the competition agency at key points of the
investigation. For example, wherever possible, merging parties should have an op-
portunity to meet with the competition agency prior to the agency’s decision to
initiate a second stage inquiry (in jurisdictions with two-phase review procedures),
to impose conditions, or to challenge or prohibit the transaction.
Comment 2: As early as feasible, the competition agency should be prepared to
discuss its current evaluation of the transaction with the merging parties and at-
tempt to identify potentially dispositive issues. Some jurisdictions find it valuable
to hold pre-notification guidance sessions in appropriate cases, for example, where
the competition agency has experience in the sector and/or where the parties have
provided sufficient information prior to notification to permit the competition
agency to formulate preliminary views. While the competition agency should en-
deavor to identify such issues as soon as possible, certain issues may not come to
light until later in the process. Such discussions therefore would not limit the com-
986
petition agency’s discretion to pursue new or additional theories of competitive

harm that may emerge during the investigation.
C. — Merging parties should be advised not later than the beginning of

a second-stage inquiry why the competition agency did not clear the
transaction within the initial review period
Comment 1: The competition agency should provide the merging parties with an
explanation (either orally or in writing) of the competitive concerns that give rise to
the need for an in-depth review. In jurisdictions that use a two-phase review proce-
dure, this explanation should be provided not later than the beginning of a second-
stage inquiry. In single-phase jurisdictions, the competition agency should advise
the merging parties of perceived competitive concerns as promptly as possible. At a
minimum, the explanation should consist of a short and plain statement of the com-
petitive concerns. Any such statement would not limit the competition agency’s
discretion to pursue new or additional theories of competitive harm that may
emerge during the investigation.
Comment 2: Providing such an explanation has several beneficial effects. First, it
promotes transparency and predictability of agency action. Second, it promotes ef-
ficiency and reduces transaction costs in the review process by allowing the merg-
ing parties to focus on issues identified as problematic, thereby facilitating resolu-
tion of these issues as quickly as possible. Third, it reduces the potential for
unnecessary delay.
ICN RPs
D. — Where investigation periods are not subject to definitive
deadlines, procedures should be adopted to ensure that the
investigation is completed without undue delay
Comment 1: Where the investigation period is not subject to a definitive deadline,
notional timetables (e.g., service standards) for the general conduct of investiga-
tions should be issued and/or, in appropriate cases, “timing agreements” between
the reviewing agency and the merging parties should be considered. Such agree-
ments would set out a prospective plan and proposed schedule for the investigation
of particular transactions. Where such an agreement is appropriate, examples of
possible commitments include: (i) scheduled meeting dates between the competi-
tion agency and the merging parties; (ii) timetables for possible modification of and
compliance with information requests; (iii) dates for depositions or interviews of
company representatives; (iv) dates for exchange of economic information and the-
ories; (v) dates for discussions among economists; (vi) dates by which the parties
may submit briefing memoranda or other formal submissions; (vii) anticipated tim-
ing of recommendations to senior agency officials; (viii) a timetable for submission
987
of, and reactions to, proposed remedies; and (ix) the date before which the parties
commit not to close the transaction.
Comment 2: Where the investigation period is tolled or otherwise measured by ref-
erence to the merging parties date of compliance with compulsory information re-
quests, the competition agency should avoid issuing seriatim requests for informa-
tion to the fullest extent practicable, to promote certainty as to the anticipated
duration of the applicable review period and to avoid duplicative effort by and un-
due burden on the merging parties.
Comment 3: Investigation periods should not be tolled based upon the issuance or
pendency of third-party information requests, given that third parties may have no
incentive to facilitate timely review and may even be hostile to the transaction.
However, third parties should be required to comply with compulsory information
requests within a reasonable period of time to facilitate timely completion of the
investigation. Competition agencies also should consider adopting specific mea-
sures to limit delay that target companies might otherwise cause in the context of
non-consensual transactions, such as hostile tender offers.
Comment 4: The existence of specified investigation periods should not preclude
the competition agency from closing its investigation prior to specified review
deadlines once it concludes that a transaction — either as originally proposed or as
modified pursuant to commitments made by the merging parties — does not raise
material competitive concerns. Competition agencies should have procedures ena-
bling them to grant early termination of applicable waiting periods under such
circumstances.
E. — Competition agencies should seek to avoid imposing

unnecessary or unreasonable costs and burdens on merging parties
and third parties in connection with merger investigations
Comment 1: Recognizing that merger analysis often requires substantial amounts of
information, competition agencies should seek to avoid imposing unnecessary or
unreasonable costs and burdens on merging parties and third parties in conducting
merger investigations. Information requests should be reasonably tailored to obtain
the information the competition agency needs to complete its investigation and to
take any necessary enforcement actions. Such requests should be focused on the
aspects of the proposed transaction that raise potential competitive concerns. Re-
quests for information unrelated to such concerns should be avoided. Proposed for-
mal information requests should be subject to appropriate internal review proce-
dures prior to issuance.
Comment 2: Applicable laws and rules should permit the case team (i.e., agency
staff responsible for conducting the investigation) to modify information requests
in an effort to avoid unnecessary or unreasonable costs and burdens. The case team
should be willing to consider possible modifications proposed by the parties. Issues
988
relating to proposed modifications should be resolved promptly to avoid delay and

potentially unnecessary information-gathering.
Comment 3: To the extent it does not prejudice the conduct of the investigation,
competition agencies should consider permitting the parties to submit information
and documents in the manner in which the company maintains such information
and documents in the ordinary course of business. Parties should not be required to
supply information that is not in their custody or control or not reasonably accessi-
ble to them. Under such circumstances, parties may be required to submit a state-
ment explaining why they are unable to supply requested information.
Comment 4: While recognizing that full-text translations of certain pre-existing for-
eign language documents may be necessary to permit the reviewing agency to con-
duct its investigation, competition agencies should be sensitive to the significant
costs and burdens involved in providing full-text translations of voluminous docu-
mentary submissions and should be selective in imposing full-text translation re-
quirements. Translations should, absent unusual circumstances, be required only
for categories of documents that are relevant to legal or factual issues raised by the
transaction under review. Where translation burdens will be substantial notwith-
standing this general limitation, competition agencies should be willing to consider
reasonable proposals by responding parties aimed at reducing these burdens, such
as providing translations of relevant excerpts of voluminous documents, without
prejudice to the competition agency’s ability to subsequently require full transla-
tions where the agency determines that such translations are needed to complete its
investigation, to initiate enforcement proceedings, or otherwise discharge its
responsibilities.
Comment 5: Disagreements between the case team and a merging party relating to
whether a request is reasonable or unduly burdensome or whether the merging ICN RPs
party has adequately complied with the request should be subject to timely review
mechanisms. Although applicable review mechanisms in some jurisdictions include
resort to an independent tribunal, resolution of such disputes may appropriately be
handled through internal review procedures within the competition agency, for ex-
ample, by permitting the merging party to raise disputed issues with senior agency
officials. Appropriate review mechanisms relating to the reasonableness of compul-
sory information requests and adequate compliance with such requests should like-
wise be available to third parties subject to information requests.
F. — Merger investigations should be conducted with due regard for

applicable legal privileges and related confidentiality doctrines
Comment 1: In responding to information requests, parties should not be required to
disclose materials and information that are subject to applicable legal privileges and
related confidentiality doctrines (such as the attorney work-product doctrine) in the
requesting jurisdiction. When information requests are directed to persons or facili-
ties in other jurisdictions, competition agencies should give due consideration to
989
similar legal privileges and doctrines applicable in those jurisdictions unless such
consideration is precluded by applicable laws in the requesting jurisdiction or by
the competition agency’s responsibilities under those laws.
Comment 2: Parties may be required to identify and describe materials and infor-
mation withheld on the basis of legal privilege and related confidentiality doctrines
to permit the competition agency to assess the legitimacy of privilege claims. Pro-
cedures relating to the identification of materials and information withheld on the
basis of legal privilege and related doctrines should not impose unreasonable bur-
dens on the parties.
Comment 3: Competition agencies should also establish and maintain policies per-
taining to the handling of privileged materials and information in connection with
exchanges of such materials and information with other competition agencies, in-
cluding any exchange pursuant to a voluntary waiver. Competition agencies should
promote transparency with respect to their policies and practices relating to legal
privileges and related confidentiality doctrines.
VII. — Procedural Fairness

A. — Procedural fairness should be afforded to merging parties and
third parties with a legitimate interest in the merger under review
Comment 1: Procedural fairness should be a basic attribute of all merger review
procedures. Procedural fairness comprises many factors, including elements of
practices discussed elsewhere in these Recommended Practices (e.g., transparency,
timeliness of review, conduct of merger investigations). This Recommended Prac-
tice focuses on procedural fairness as it relates to providing the merging parties and
third parties with a legitimate interest in the merger under review, as recognized
under applicable laws in the reviewing jurisdiction (hereinafter “third parties”),
with a meaningful opportunity to express their views.
Comment 2: Laws and practices regarding procedural fairness may provide for
safeguards at different stages in the merger review process, depending on whether
the jurisdiction uses a prosecutorial or administrative merger review system. In a
prosecutorial system, the competition agency generally investigates the merger and
decides whether to challenge it, but an independent judicial body decides whether
to prohibit the transaction. In an administrative system, powers to investigate and to
prohibit a merger are generally entrusted to a single authority or to two different
administrative authorities, subject to the possibility of review by an independent
adjudicative body.
Comment 3: Foreign firms should be treated no less favorably than domestic firms
in like circumstances in all aspects of the merger review process, including with
respect to procedural fairness.
990
B. — Prior to a final adverse enforcement decision on the merits,

merging parties should be provided with sufficient and timely
information on the facts and the competitive concerns that form the
basis for the proposed adverse decision and should have a
meaningful opportunity to respond to such concerns
Comment 1: If a competition agency reviewing a merger identifies material com-
petitive concerns arising from the transaction, it should provide the merging parties
the opportunity to respond to these concerns prior to a final adverse enforcement
decision on the merits — i.e., in an administrative system, a decision to prohibit the
transaction or to clear it subject to conditions or, in a prosecutorial system, a deci-
sion to institute a legal action to challenge or prohibit the transaction. Providing
this opportunity serves the public interest in ensuring well-informed enforcement
decisions, as well as the interests of the merging parties.
Comment 2: Merging parties should have sufficient information on the material
competitive concerns raised by the transaction. Information disclosed to the merg-
ing parties should allow them to ascertain the legal, economic and factual bases on
which the competitive concerns are founded. Such disclosure should be subject to
reasonable confidentiality protections and any applicable legal privileges.
Comment 3: Merging parties should have information on the competitive concerns
in a timely manner. Without compromising the effectiveness of an investigation or
the outcome of enforcement proceedings, the competition agency should consider
apprising merging parties of specific concerns as soon as feasible during the inves-
tigation, so the parties can express their views. In any event, the communication of ICN RPs
such competitive concerns should be made in time for the merging parties to have
an opportunity to respond to these concerns and to consider and propose remedies
to address these concerns prior to the issuance of a final enforcement decision.
Similarly, if merger laws allow the competition agency or a court to clear a transac-
tion subject to conditions, the competition agency or court should afford the merg-
ing parties the opportunity to comment before imposing such remedies.
Comment 4: The timing of access to specific information gathered and relied on by
the competition agency in arriving at a final adverse enforcement decision may
vary among merger review systems. For example, in some systems, merging parties
have the right to review the agency’s investigation file prior to the adverse enforce-
ment decision. In other systems, parties are entitled to such information only during
court proceedings.
C. — Third parties should be allowed to express their views during the

merger review process
991
Comment 1: Competition agencies have used the following complementary meth-

ods, among others, to obtain views from third parties: (a) inviting third parties to
express their views on the merger through publication, e.g., in an official gazette or
on a website; (b) contacting third parties likely to be affected by the merger, such
as customers, suppliers, or competitors of the merging parties; (c) circulating infor-
mation requests to third parties potentially affected by the transaction; (d) affording
third parties an opportunity to comment on proposed remedies; and (e) permitting
third parties to apply for formal admission to the proceedings.
D. — The competition agency should manage the merger review

process to ensure that the process is implemented fairly, efficiently,
and consistently
Comment 1: The competition agency should make certain that there are safeguards,
or “checks and balances,” ensuring that merger reviews are handled in a fair, effi-
cient, and consistent manner, procedurally and substantively. Consistent application
of the merger review process is important to enhance the predictability, fairness,
and acceptance of merger review.
Comment 2: Given the variety of merger review procedures among jurisdictions,
different methods may be used to achieve these goals. Examples of safeguards that
have been applied include: (a) assigning a particular unit to review the legality and
consistency of proposed enforcement actions; (b) establishing an economics section
within the competition authority to advise decision-makers on the merits of the
case; (c) developing internal operational guidelines; (d) supervisory mechanisms to
oversee the staff’s handling of merger reviews; (e) ensuring a separate review of
preliminary findings and/or the results of the in-depth investigation; (f) creating
separate investigation and enforcement units; and (g) decision-making by a col-
legiate body.
E. — Merger review systems should provide an opportunity for timely

review by a separate adjudicative body of a competition agency’s
final adverse decision on the merits of a merger
Comment 1: Once an adverse decision has been taken with respect to a merger, it is
often difficult for the transaction to remain viable. Accordingly, judicial review in
merger cases should aim to permit resolution of the case within a time frame during
which the merger remains viable. Competition agencies should take appropriate
steps that are consistent with their respective enforcement responsibilities to facili-
tate such timely judicial review. Such steps may include cooperating in available
procedures for expedited review or expedited evidence gathering.
992
VIII. — Transparency
A. — Merger control laws should be applied with a high level of
transparency, subject to the appropriate protection of confidential
information
Comment 1: “Transparency” refers to the ability of the public to see and understand
the workings of the merger review process. Transparency is important to achieve
consistency, predictability and, ultimately, fairness in applying merger control
laws, thereby enhancing the credibility and effectiveness of merger control enforce-
ment. Transparency also allows merging parties to better understand and predict the
likely outcome of particular cases and the time and costs the review is likely to
entail.
Comment 2: Transparent application of merger control laws entails making all rele-
vant laws, regulations, and other materials relevant to merger control law, policy,
and practice readily available to the public in a timely manner.
Comment 3: Transparency requirements are limited by the obligation to protect
confidential information. When a competition agency or other institution makes in-
formation pertaining to a merger publicly available, it should provide for the pro-
tection of confidential information.
B. — Merger control regimes should be transparent with respect to, at

a minimum, the jurisdictional scope of the merger control law, the
competition agency’s decision-making procedures, and the
principles and criteria the competition agency uses to apply the ICN RPs
substantive review standard
Comment 1: With respect to the jurisdictional scope of the merger control law, pub-
licly available materials should permit ready determination of: (i) the types of
transactions to which the merger control law applies; (ii) any exemptions or exclu-
sions from the merger control law; and (iii) the precise tests or thresholds that gov-
ern whether the parties must notify the transaction or whether the competition
agency has jurisdiction over a transaction.
Comment 2: With respect to the procedures applicable to merger review, publicly
available materials should permit ready determination of: (i) the identity and con-
tact details of the competition agencies; (ii) any filing deadlines; (iii) notification
procedures, including the information to be provided in the initial filing; (iv) any
filing fees; (v) review periods; (vi) suspensive periods and any limits on imple-
menting the transaction prior to clearance; (vii) investigative procedures; (viii) any
deadlines that the merging parties, third parties, or the competition agencies must
obey during the review period; (ix) procedures and deadlines for appealing adverse
decisions or for challenging a merger; (x) procedural rights of merging and third
993
parties; and (xi) enforcement procedures pertaining to violations of the merger con-
trol laws (e.g., failure to notify) or merger review decisions (e.g., breach of condi-
tions or obligations); (xii) measures for protecting confidential information.
Comment 3: Merger control laws and regulations are often written in general terms,
and the principles and criteria used to apply the substantive standard of review set
forth in the basic legislation are often developed through administrative practice
and case law. Accordingly, to achieve transparency, publicly available materials
should include not only the basic legislation, but also the relevant case law, en-
forcement policies, and administrative practices that clarify and develop the basic
legal framework. In particular, these supplemental materials should provide insight
into the substantive principles and criteria (i.e., the analytical framework) that the
competition agency uses in applying the law. If a jurisdiction’s merger test includes
consideration of non-competition factors, the way in which the competition and
non-competition considerations interact should also be made transparent.
C. — Competition agencies should promote transparency by making

information about the current state of merger control law, policy, and
practice readily available to the public
Comment 1: There are many appropriate ways for competition agencies to promote
transparency. These include, among others: publishing general guidelines and no-
tices on substantive law and procedure; publishing individual enforcement and non-
enforcement decisions; issuing press releases on important decisions; issuing state-
ments explaining actions or non-actions that signify a change in enforcement pol-
icy; delivering speeches; and publishing informational materials. Methods can be
combined for increased effectiveness.
Comment 2: A reasoned explanation should be provided for decisions to challenge,
block or condition the clearance of a transaction, and for clearance decisions that
set a precedent or represent a shift in enforcement policy or practice. Some compe-
tition agencies issue a reasoned decision at the end of each merger review, while
others do so when enforcement action is taken. What matters is that the available
information should allow the public to monitor consistency, predictability, and fair-
ness in the application of the merger review process.
Comment 3: After acquiring sufficient experience, competition agencies may wish
to consider publishing guidelines on merger analysis, procedure, and/or jurisdiction
to assist interested parties in handling future merger cases. Many competition agen-
cies find it useful to obtain public input prior to issuing such guidelines. To the
extent that competition agencies formally rely on guidelines, policies, or precedents
from other jurisdictions, the scope and nature of such reliance should be publicly
disclosed. If such guidelines are issued, they should be reviewed periodically to
reflect current practice.
Comment 4: Materials published to achieve transparency should be made available
on a publicly accessible, dedicated website. They should be published in a timely
994
manner and updated regularly to reflect the current state of law, policy, and
practice.
Comment 5: To facilitate transparency for foreign firms, competition agencies are
encouraged, to the extent permitted by available resources, to consider making
available an English translation of basic merger laws, regulations, guidelines, and
interpretive notices.
IX. — Confidentiality
A. — Business secrets and other confidential information received
from merging parties and third parties in connection with the merger
review process should be subject to appropriate confidentiality
protections
Comment 1: Public disclosure of business secrets and other confidential informa-
tion received by competition agencies in connection with the merger review pro-
cess may prejudice important commercial interests and may have adverse effects on
competition. The prospect of potential disclosure may also discourage parties from
submitting all relevant information to and fully cooperating with the reviewing
agency. Confidential information that merging parties and third parties submit in
connection with the merger review process should therefore be subject to appropri-
ate confidentiality protections. In the absence of statutory protection, competition
agencies should establish policies and procedures to ensure that confidential infor-
mation will be subject to appropriate confidentiality safeguards.
Comment 2: Confidentiality rules should strike an appropriate balance between ICN RPs
commercial interests and other considerations, including the need to ensure proce-
dural fairness for the merging parties, the public interest in protecting the decision-
making process, and transparency of the merger review process.
Comment 3: Confidential information submitted by merging parties and third par-
ties should not be used except in connection with the competition agency’s review
of the merger and other authorized law enforcement purposes. With respect to the
use of such information for merger review purposes, it should not be disclosed
outside the competition agency except for the purposes of allowing the agency to
discharge its merger review mandate effectively (including the initiation and con-
duct of enforcement proceedings) and to provide merging parties with adequate
procedural fairness. Such information may also be disclosed outside the competi-
tion agency for purposes of its merger review: (1) where authorized pursuant to
international treaties, agreements, or protocols where reciprocal confidentiality pro-
tections are specified; (2) in response to requests for judicial assistance by other
competition agencies pursuant to national legislation that authorizes such disclo-
sure, provided that confidential treatment by the requesting agency is ensured; and
(3) with the submitting party’s consent — for example, disclosure to other competi-
tion agencies pursuant to a waiver.
995
Comment 4: To the extent that the competition agency is charged with deciding on
requests for confidential treatment, submitting parties may be required to identify
confidential information in their submissions and to demonstrate that the informa-
tion meets applicable standards for confidentiality protection. Where the competi-
tion agency denies a request for confidential treatment, it should provide the re-
questing party with timely notice of the agency’s determination and the reasons for
the denial. Such notice may be formal or informal, but should be provided in a form
that will permit the requesting party to take appropriate steps to contest the determi-
nation prior to disclosure.
B. — Competition agencies should promote transparency of the

confidentiality laws, policies, and practices applicable to their
merger control procedures
Comment 1: As discussed more fully in Recommended Practice VIII, transparency
can be achieved by various means including policy statements, guidance notes, no-
tices, instructions to notification forms and information requests, rules of practice,
published decisions, and other communications that are readily accessible to af-
fected parties. Such communications might include summaries of the competition
agency’s confidentiality policies and practices (with references to applicable confi-
dentiality laws and rules), including any steps that submitting parties must take to
invoke confidentiality protections and exceptions to the competition agency’s abil-
ity to preserve confidentiality, such as freedom of information laws, judicial pro-
ceedings, and legislative or administrative inquiries. The competition agency’s
practice regarding retaining, destroying, or returning confidential documents at the
end of an investigation should also be publicly available.
Comment 2: Competition agencies should clearly explain the nature and extent of
possible public disclosure involved in the merger review process, including any
publication requirements and the general nature and scope of any potential disclo-
sure of confidential information in connection with contacting third parties.
Comment 3: Competition agencies should promote transparency with respect to
policies or practices on exchanging merger-related information with other govern-
ment agencies in the jurisdiction concerned and with other competition agencies in
the context of interagency coordination.
C. — Competition agencies should seek to defer contacts with third

parties until the proposed transaction becomes public where such
deferral would not adversely affect the reviewing agency’s ability to
conduct its investigation effectively or complete its review within
applicable deadlines
996
Comment 1: Premature public disclosure of a pending transaction may have an ad-

verse affect on the merging parties’ commercial interests — negotiations may be
disrupted, employee morale may suffer, and commercial relationships may be jeop-
ardized. The possibility that the competition agency will contact third parties prior
to public announcement may also reduce the parties’ willingness to initiate early
discussions with the competition agency regarding proposed transactions. Accord-
ingly, competition agencies should seek to defer contacts with third parties prior to
public announcement of the transaction in cases in which such deferral will not
adversely affect the reviewing agency’s ability to conduct its investigation effec-
tively or complete its review within applicable deadlines.
Comment 2: In many jurisdictions, upon receipt of a notification, the competition
agency routinely publishes a notice of the fact of notification inviting third parties
to submit comments. In such jurisdictions, because merging parties are on notice
that notification is tantamount to public announcement, the practical import of this
Recommended Practice is that the competition agency should normally defer mar-
ketplace contacts with third parties regarding non-public transactions until notifica-
tion has, or should have, occurred. Where competition agencies in such jurisdic-
tions contemplate contacting third parties regarding non-public transactions prior to
notification, they should consider giving the merging parties advance notice of their
intention to initiate such contacts and the agency should be willing to consider rea-
sonable requests by merging parties to defer such contacts until notification has
occurred or the transaction has otherwise become public.
Comment 3: In jurisdictions where the fact of notification is not made public, merg-
ing parties should be on notice that the competition agency may contact third par-
ties following notification notwithstanding that the pending transaction has not
been publicly disclosed. Consistent with the considerations set forth in Comment 1, ICN RPs
however, competition agencies in such jurisdictions should be willing to consider
reasonable requests by notifying parties to defer such contacts for a limited time for
good cause, again provided that such deferral would not prejudice the competition
agency’s ability to conduct its investigation effectively or to timely complete its
review.
D. — Confidentiality rules should strike an appropriate balance

between protecting the confidentiality of third-party submissions
and procedural fairness considerations
Comment 1: Because limitations on the merging parties’ ability to obtain access to
third-party submissions may implicate procedural fairness considerations, confi-
dentiality rules applicable to third-party submissions should strike an appropriate
balance between these procedural fairness considerations and the need to protect
confidential information contained in such submissions.
Comment 2: Mechanisms to facilitate access to such submissions might include re-
questing third parties to submit non-confidential versions of any submissions that
997
may be subject to disclosure, with the understanding that such versions may be
subject to disclosure for specified purposes, or requesting submitting parties to pre-
pare non-confidential versions or otherwise make appropriate confidentiality desig-
nations prior to disclosure.
Comment 3: Additional safeguards may be necessary where a third party is willing
to comment only on an anonymous basis or where the nature of the comment itself
could serve to identify the party who has requested anonymity.
Comment 4: In jurisdictions where the competition agency challenges mergers
through the judicial system, such that the merging parties will have an opportunity
to seek access to confidential third-party submissions under applicable civil discov-
ery rules, access to such submissions might be deferred until the initiation of judi-
cial proceedings.
E. — Competition agencies should avoid unnecessary public

disclosure of confidential information in public announcements,
court or administrative proceedings, decisions, and other
communications respecting a pending transaction
Comment 1: Competition agencies should avoid unnecessary public disclosure of
confidential information. Confidential information that is not relevant to the merger
review should not be publicly disclosed. For example, non-public financial terms
agreed between the merging parties would not normally be relevant to a competi-
tive assessment of the transaction and, therefore, should not normally be publicly
disclosed as part of the merger review process.
Comment 2: Where competition agency procedures provide for public and non-
public versions of certain documents, parties should have an opportunity to review
the public version prior to issuance to ensure that it does not include confidential
information. Where parties do not have such an opportunity, competition agencies
should consider other measures that would permit a submitting party to take appro-
priate steps to prevent or limit public disclosure of information that the submitting
party has designated confidential where that party has not previously consented to
the intended disclosure (for example, pursuant to a voluntary waiver). Such mea-
sures might include putting the submitting party on notice that public disclosure of
such information is contemplated or, in prosecutorial systems, submitting filings
that contain sensitive information under seal to enable the affected party to seek
appropriate protective orders from the reviewing tribunal.
X. — Interagency Coordination
A. — Competition agencies should seek to coordinate their review of
mergers that may raise competitive issues of common concern
998
Comment 1: Interagency coordination occurs in a number of contexts. This Recom-

mended Practice concerns competition agencies’ coordinated review of mergers
that may raise competitive issues of common concern in their jurisdictions.
Comment 2: The goals of interagency coordination include fostering efficient
merger review, effective merger enforcement, and consistent, or at least non-con-
flicting, outcomes in the coordinating jurisdictions as well as reducing duplication
and unnecessary burdens for parties and agencies.
Comment 3: Convergence toward recognized best practices in merger review can
help to facilitate effective interagency coordination, for example, through more
consistent timetables and procedural rules.
Comment 4: Interagency coordination is voluntary; competition agencies that are
requested to coordinate merger reviews are generally encouraged, but are not obli-
gated, to do so. Competition agencies that agree to coordinate their reviews remain
free to make their own independent decisions. An agency’s agreement to coordi-
nate a review does not imply that it should consider competitive effects that may
occur outside the jurisdiction.
B. — Interagency coordination should be conducted in accordance

with applicable laws and other legal instruments and doctrines
Comment 1: Interagency coordination should be conducted in accordance with ap-
plicable national laws, including rules regarding the treatment of confidential infor-
mation and privileged communications, and applicable cooperation treaties and
agreements. ICN RPs
Comment 2: Where two or more competition agencies engage in coordinated
merger reviews on a recurring basis, it may be useful for them to develop formal
agreements, memoranda of understanding, or other protocols for coordinating their
merger reviews. The formation of regional associations of competition agencies
may also be useful for the development of these instruments. In the absence of such
instruments, international cooperation treaties, agreements, memoranda, and rec-
ommendations that have been developed between other jurisdictions or in multina-
tional organizations may provide useful guidance.
C. — Interagency coordination should be tailored to the particular

transaction under review and the needs of the competition agencies
conducting the merger investigations
Comment 1: The scope and depth of interagency coordination will depend on the
facts and issues raised in the transaction under review. Accordingly, interagency
coordination should be sufficiently flexible to accommodate different types of
investigations.
999
Comment 2: When a competition agency becomes aware that a merger appears

likely to raise competitive issues of common concern as to which coordination
might be appropriate, that agency should contact other relevant competition agen-
cies as soon as practicable. Before competition agencies coordinate, they should
assess whether the transaction appears to raise competitive issues of common
concern.
Comment 3: Depending on the complexity of the merger review, the applicable
legal framework, and the competitive issues of common concern identified, compe-
tition agencies may coordinate by, among other methods: identifying case team li-
aisons; discussing prior relevant decisions; coordinating the timing of reviews; co-
ordinating information requests; sharing analyses; and, as appropriate, conducting
joint interviews of merging parties and third parties and coordinating site visits.
Comment 4: A competition agency should not delay its merger decision based on
reviews pending in other jurisdictions, except where continued coordination is war-
ranted to address common substantive or remedial issues.
D. — Competition agencies should encourage and facilitate the

merging parties’ cooperation in the merger coordination process
Comment 1: Cooperation of the merging parties helps to facilitate effective inter-
agency coordination. Examples of such cooperation include timing of notification
in coordinating jurisdictions and granting confidentiality waivers. To encourage
such cooperation, competition agencies should seek to further the transparency of
the coordination process by informing parties of the benefits of coordination and
addressing concerns raised by the exchange of information pursuant to voluntary
waivers. For example, a competition agency may consider publishing a brief
description of its coordination policies and practices, including the categories of
information that would likely be exchanged pursuant to a voluntary confidentiality
waiver, or consider informing merging parties of the basic form of cooperation that
may take place in their case. Competition agencies should seek to develop a basic
waiver model that may be modified to suit specific circumstances.
Comment 2: Where coordination would be facilitated by the discussion of confiden-
tial information, the competition agency should encourage voluntary confidentiality
waivers, but should not pressure parties to provide waivers.
E. — Reviewing agencies should seek remedies tailored to cure

domestic competitive concerns and endeavor to avoid inconsistency
with remedies in other reviewing jurisdictions
Comment 1: To the extent consistent with their respective law enforcement respon-
sibilities, coordinating agencies should strive to ensure that the remedies they ac-
1000
cept to cure domestic competitive concerns do not impose inconsistent obligations

on the merging parties. Remedies offered by the merging parties may not be identi-
cal in each jurisdiction, e.g., because a transaction may have different competitive
effects in the various jurisdictions in which it is reviewed. However, because a rem-
edy accepted in one jurisdiction may have an impact in another jurisdiction, the
competition agencies should invite the merging parties to consider coordinating the
timing and substance of their remedy proposals. Competition agencies should be
prepared to discuss with the merging parties any cross-border implications of reme-
dies under consideration.
Comment 2: Interagency coordination on remedies may avoid unnecessary costs
and burdens resulting from duplicative remedies. Subject to relevant confidentiality
and nondisclosure rules, coordinating agencies should keep one another informed
as to remedies under consideration to the extent that they may affect the other com-
petition agency’s review and/or consideration of remedies.
Comment 3: Where possible, coordinating agencies should seek to coordinate ad-
ministrative aspects of proposed remedies of common interest to avoid unnecessa-
rily duplicative requirements and unnecessary costs and burdens. Such aspects
might include, for example, arranging common timetables for compliance with un-
dertakings, appointing common trustees to effectuate required divestitures, and har-
monizing reporting requirements.
XI. — Remedies
A. — A remedy should address the identified competitive harm arising
from the proposed transaction
Working Group Comments ICN RPs
Amended (May 2017)
Comment 1: The object of a remedy should be to maintain or restore competition
otherwise likely to be lost due to the proposed transaction. A remedy should be
considered only if the agency has a sound basis to believe that the proposed trans-
action, if implemented, would contravene the applicable merger review law. The
remedy should adequately address the potential competitive harm identified, but
should not have the object of improving upon premerger competition. Tailoring the
remedy to the competitive harm allows competition agencies to require the least
intrusive remedy while permitting, if possible, the realization of the merger’s
efficiencies.
Comment 2: To address competitive concerns identified by a competition agency,
merging parties should be permitted to propose alternative resolutions, modifica-
tions, conditions, and/or obligations that would permit the transaction to proceed
while maintaining or restoring competition otherwise likely to be lost due to the
proposed transaction, consistent with the applicable merger review law. Before pur-
suing or adopting an outright prohibition, agencies should consider such alternative
resolutions. In addition, the agency may take the initiative to propose alternative
1001
resolutions. However, there may be instances where only an outright prohibition

can adequately address the competitive concerns arising from the proposed
transaction.
Comment 3: The proposal, discussion, and adoption of remedies should be con-
ducted in a manner consistent with other Recommended Practices, particularly
those on Conduct of Merger Investigations, Procedural Fairness, Transparency, and
Interagency Coordination and be informed by the Merger Remedies Guide and the
Practical Guide on International Cooperation.
B. — The merger review system should provide a transparent

framework for the proposal, discussion, and adoption of remedies
Amended (May 2017)
Comment 1: Information on the jurisdiction’s procedures for proposing, discussing,
and adopting remedies should be readily available to those involved in merger re-
view proceedings. Such information may include, as applicable, when, how and to
whom remedies should be proposed, the types of remedies that the agency gener-
ally prefers, how a remedy proposal may be evaluated, and any standard terms or
implementation provisions the remedy would be expected to include.
Comment 2: In the event the competition agency identifies competitive concerns,
the agency should provide the merging parties with timely and substantiated infor-
mation on those concerns so the parties have sufficient time to consider and pro-
pose remedies to address those concerns prior to the final enforcement decision.
Merger review procedures should provide means to ensure that competition agen-
cies have adequate time to discuss suitable remedies with the merging parties, eval-
uate the proposed remedies, and consult appropriate third parties on the effective-
ness of the remedies.
C. — Procedures and practices should be established to ensure that

remedies are effective and easily administrable
Amended (May 2017)
Comment 1: Remedies should be effective in maintaining or restoring competition
otherwise likely to be lost due to the proposed transaction and be easily adminis-
trable. Remedies should not require significant administrative intervention by the
agency after the transaction is consummated.
Comment 2: Remedies can take two basic forms: (a) structural remedies, which
involve a direct change to the competitive market structure (such as commitments
to divest assets), and (b) non-structural remedies, which involve modifications or
constraints on the future conduct of the merged entity (such as commitments with
1002
respect to certain contractual clauses). Certain remedies, such as commitments in-

volving licensing of intellectual property rights or access to facilities, may be char-
acterized as structural or non-structural, depending on the circumstances. An effec-
tive remedy package may consist of structural and/or non-structural components,
including short-term transitional arrangements that support a structural remedy.
Comment 3: Structural remedies are generally preferred over non-structural reme-
dies, particularly for horizontal mergers, because they directly maintain or restore
the competitive structure of the market, have a durable impact, are easier to admin-
ister and do not require medium or long-term monitoring to ensure compliance.
Structural remedies can take several forms. The preferred structural remedy is typi-
cally the divestiture of an ongoing, stand-alone business unit, including the sale of
all the infrastructure and components, and the support of human resources neces-
sary for the divested business to compete effectively after the remedy is imple-
mented. The divestiture of less than an existing business carries more risk, and
requires more agency scrutiny, but may constitute an effective remedy if, taking
into account the scope of the remedy package, the nature of the business at issue,
and the resources already owned and operated by a prospective purchaser, the
divested assets are sufficient to allow the purchaser to compete successfully in the
relevant market. While short-term assistance from the merging parties can be nec-
essary to transition assets to an independent purchaser, remedies should avoid cre-
ating ongoing relationships between the merged entity and the purchaser of
divested assets that may impede competition.
Comment 4: The remedy’s effectiveness may depend on the identity of the prospec-
tive purchaser of the assets to be divested, particularly where less than an ongoing
business unit is being divested. For a remedy to be effective, it should enable the
prospective purchaser to be a viable and long-term competitor in the market in ICN RPs
which the competitive harm was identified. Competition agencies should evaluate
prospective purchasers for their financial strength, managerial expertise and opera-
tional capabilities, as well as for their independence and intention to compete with
the merged firm in the affected market after divestitures. An acquisition by the
prospective purchaser should not in itself adversely affect competition. The agency
should ensure that it has the authority and the appropriate procedures in place to
approve a prospective purchaser.
Comment 5: When a competition agency has concerns about the availability of a
suitable purchaser or viability of the proposed remedy, it should consider requiring
approval of a pre-identified purchaser of the divested assets before the merger is
consummated. Pre-identified purchasers should also be considered when there are
concerns about a lengthy divestiture process resulting in deterioration of the
divested assets.
Comment 6: Where structural remedies are either not possible or not appropriate to
address the competitive harm, a non-structural remedy may be appropriate to ad-
dress the competitive concerns. Non-structural remedies that facilitate or protect
competition (such as reducing switching costs and opening up tender processes) are
generally more effective than those that aim to control prices or output levels (such
as price controls, service level agreements, and supply commitments). In crafting
1003
non-structural remedies, competition agencies should consider whether ongoing

monitoring of the remedy is feasible and be wary of high implementation costs
associated with monitoring, terms that restrain potentially pro-competitive conduct,
and terms that are vulnerable to circumvention and manipulation. Competition
agencies should consider other alternatives before imposing price controls as reme-
dies, as price controls can most directly distort market forces and harm competi-
tion, require a great deal of market insight that is typically not readily available,
and will likely require regulatory oversight and intervention to implement and
maintain.
Comment 7: Market testing, involving either a formal or informal process by which
a competition agency obtains views and comments from third-party customers, sup-
pliers, and/or competitors, should be encouraged when it helps to determine if the
proposed remedy will adequately address competitive concerns. Third-party views
and comments should be evaluated by an agency, while remaining attuned to self-
interest or any other motives that might attempt to influence the agency’s views.
Comment 8: Timing is a critical factor in determining whether a merger remedy is
effective. Remedies should be implemented in a prompt and timely manner. Reme-
dies should have a specified end date or termination provision.
D. — Remedies should provide appropriate means to ensure

implementation, monitoring of compliance, and enforcement of the
remedy
Amended (May 2017)
Comment 1: Competition agencies may have different terminology or mechanisms
for formalizing and enforcing remedies. Regardless of the terminology used (“rem-
edy order” or other), a formal and written form of imposing remedies should iden-
tify, provide notice, and bind the entities subject to its terms. The terms should be
sufficiently clear and precise to provide the parties adequate guidance in imple-
menting the remedy. The remedy order should also include provisions that will en-
able the competition agency to monitor compliance and ensure the order is fully
implemented.
Comment 2: As part of a structural remedy, whether through a formal provision of
the remedy order or otherwise, a competition agency should require merging par-
ties to maintain and preserve the assets pending divestiture to ensure that there is no
deterioration of the assets’ competitive strength. Such requirements (often called
“hold separate” or “asset preservation” measures) can help to ensure the indepen-
dence and viability of divested assets by maintaining their value and goodwill, pro-
tecting sensitive information, encouraging employees to remain with the entity until
divestiture, and otherwise ensuring the divested assets are not allowed to deterio-
rate. A competition agency may wish to appoint a hold separate manager who can
oversee implementation of hold separate measures.
1004
Comment 3: In a remedy order, it may be appropriate to include terms permitting

the competition agency to select one or more independent trustees who can oversee
the divestiture process or the conduct of the merging parties over the duration of a
non-structural remedy. Monitoring trustees can help to oversee implementation of
remedies and provide regular reports or updates to the competition agency. A di-
vestiture trustee may take over the divestiture process from the merging parties if
they fail to sell the divested assets within the required time period.
Trustees should be independent of the merging parties, should have appropriate
qualifications for the role, and should not be subject to conflicts of interest. The
scope and limits of the trustee’s responsibilities and authority should be clearly set
out in a mandate provided or approved by the competition agency, which should
also state that the trustee cannot accept instructions from or be dismissed by the
merging parties. Nevertheless, the parties can be required to compensate the trus-
tee. The competition agency should maintain oversight over trustees.
Comment 4: The competition agency should have the means to investigate compli-
ance with the remedy order, including the ability to inspect and copy records, con-
duct reviews, and to require periodic or one-time reporting obligations by the par-
ties and/or the trustee(s) on the implementation of the remedy. The ultimate
decision regarding compliance with the remedy order should rest with the agency
or court, and not with the trustee.
Comment 5: Competition agencies are unable to control or predict every factor ca-
pable of impacting the implementation of remedies. Significant and permanent
changes in market conditions may impact the effectiveness of a remedy, especially
in cases where a nonstructural remedy continues over a long duration. Revision
clauses or other procedures, which would permit remedies to be removed or modi-
fied upon demonstration of specified objectives or criteria, may provide flexibility ICN RPs
to address unanticipated factors. Modifications can range from extensions of imple-
mentation deadlines to remedy substitutions or waivers to implement certain
commitments.
Comment 6: When a party fails to comply with the terms of a remedy order, the
competition agency should seek to enforce the order directly or through the courts.
In some jurisdictions, the merger clearance may automatically lapse. Depending on
the circumstances, violations of remedy orders that are deliberate or intentional
may be treated more severely than inadvertent violations. If non-compliance results
from the remedy order being impossible to implement, competition authorities can
consider whether modifications or alternative remedies may be effective to address
the relevant competitive concerns.
XII. — Competition Agency Powers

A. — Competition agencies should have the authority and tools
necessary for effective enforcement of applicable merger review
laws
1005
Comment 1: Merger review is fact-intensive; competition agencies therefore require

the ability to obtain information relevant to their review of proposed transactions.
Competition agencies should be provided with appropriate investigative tools and
mechanisms by which the agency can compel merging and third parties to produce
relevant information, for example, by providing the competition agency with the
ability to seek effective sanctions for non-compliance with formal requests for doc-
uments, testimony and other information.
Comment 2: For the merger review process to operate effectively, the competition
agency must have the ability to initiate enforcement actions against proposed merg-
ers and to seek sanctions for non-compliance with applicable legal requirements
and agency decisions and orders. Competition agencies should therefore have the
enforcement tools needed to achieve these objectives.
Comment 3: Competition agencies should have the authority to permit proposed
transactions to proceed subject to conditions that address perceived competitive
concerns in the jurisdiction concerned. Where conditional clearance is authorized,
the agency should also have effective means to ensure compliance with specified
conditions and to seek sanctions for non-compliance.
Comment 4: The merger review process should be subject to appropriate procedural
safeguards to govern competition agencies in the exercise of their investigative au-
thority and enforcement powers.
B. — Competition agencies should have sufficient staffing and

expertise to discharge their enforcement responsibilities effectively
Comment 1: Competition agencies should have funding, staffing and expertise
commensurate with their merger enforcement responsibilities, including detecting
anticompetitive transactions, bringing appropriate enforcement actions, and avoid-
ing unnecessary costs and delay with respect to transactions that do not contravene
applicable legal prohibitions.
Comment 2: In order to employ a sufficient number of qualified personnel and to
fund investigations and other enforcement activities necessary to discharge their
enforcement responsibilities efficiently and effectively, competition agencies re-
quire adequate financial resources. Competition agencies should seek to optimize
their use of available resources by prioritizing their merger enforcement based on
the transaction’s potential competitive impact in the jurisdiction.
Comment 3: Agency staff should include professionals with training and experience
in competition law and economics, including merger analysis. Subject to applicable
confidentiality safeguards, competition agencies should also be able to consult with
independent industry, legal, and economic experts in other agencies and the private
sector.
Comment 4: Competition agencies should encourage continuing legal and eco-
nomic training of their professional personnel. This may be accomplished through
1006
in-house and inter-agency training programs, as well as through academic institu-

tions and training activities sponsored by private sector organizations (such as bar
associations and legal societies).
C. — Competition agencies should have sufficient independence to

ensure the objective application and enforcement of merger review
laws
Comment 1: The objective application of competition standards in merger enforce-
ment promotes consistency, predictability, and legal certainty. Lack of objectiv-
ity — or even a perceived lack of objectivity — tends to frustrate these objectives
and, moreover, may undermine public confidence in the competition agency and
the merger review process. Enabling legislation and governmental policies and
practices should ensure that competition agencies have sufficient independence to
discharge their enforcement responsibilities based solely on an objective applica-
tion of relevant legislation and judicial precedents.
Comment 2: Competition agencies should also seek to avoid any perception that
their enforcement activities are motivated by considerations other than those in the
relevant merger review legislation. Means of achieving this objective include trans-
parency in the merger review process and providing an opportunity for timely re-
view of the competition agency’s final decision on the merits by a separate adjudi-
cative body.
XIII. — Review of Merger Control Provisions ICN RPs

A. — Jurisdictions should periodically review their merger control
provisions to seek continual improvement in the merger review
process
Comment 1: Merger control laws and procedures should be reviewed periodically
in an effort to seek continual improvement in the merger review process. Such re-
views should include all substantive and procedural aspects of the merger review
process, including notification thresholds, notification procedures, and enforcement
practices. The frequency and nature of the review may depend on its subject matter.
Comment 2: In certain jurisdictions, periodic review of the merger control process
is expressly required by the relevant legislation itself, for example, by requiring the
competition agency to conduct and publish periodic evaluations of the efficacy of
existing laws and procedures. In some jurisdictions, monetary notification thresh-
olds are periodically adjusted by operation of law based on relevant inflation or
other economic indices. Such automatic indexing is particularly useful in jurisdic-
tions where the local currency value is subject to significant inflationary
fluctuation.
1007
B. — Jurisdictions should consider reforms to their merger control

laws and procedures that promote convergence towards recognized
best practices
Comment 1: Convergence of merger control regimes towards recognized best prac-
tices will promote international cooperation, efficiency, and the elimination of un-
necessary transaction costs in the multi-jurisdictional merger review process. Juris-
dictions should therefore seek to enact reforms of their merger control laws and
procedures that promote convergence towards recognized best practices.
1008
COMPETITION TRIBUNAL PRACTICE
DIRECTIONS*
NOTICE REGARDING THE COVID-19 PANDEMIC

(MARCH 18 2020)*
The Competition Tribunal is monitoring the evolving COVID-19 situation and is

taking measures to protect the health and safety of employees, parties and the pub-
lic. Given the current government and public health information, the Tribunal has
put in place the following measures, effective immediately.
Competition Tribunal Offices

The Tribunal remains open for business but the Tribunal premises are closed to the
public until further notice. Tribunal Members and employees are equipped to work
remotely and will continue to provide services to the parties and the public, as
required.
Filing of Case Documents

The Tribunal’s electronic filing system is fully operational and parties should con-
tinue to file their documents by electronic transmission in accordance with Rule 12
of the Competition Tribunal Rules. The Tribunal will not allow paper filing for the
Directions
time being.
Practice
Deadlines and Tribunal Hearings

There will be no in-person hearings between now and April 17, 2020. Should cir-
cumstances dictate the postponement of a hearing date currently scheduled after
April 17, the Tribunal Registry will notify the parties accordingly.
* Practice Direction regarding the Filing of Confidential and Public Documents with the
Tribunal (March 2018), http://www.ct-tc.gc.ca/Procedures/FilingDocuments-eng.asp.
Reproduced by permission of the Competition Tribunal Secretariat, 2020.
* Notice Regarding the COVID-19 Pandemic, (March 18, 2020), https://www.ct-tc.gc.ca/en/
procedure/notices/covid19.html. Reproduced with the permission of the Competition
Tribunal Secretariat of the Competition Tribunal, 2020. This document is subject to change
without notice. For the most current version of the document refer to the Competition
Tribunal website: https://www.ct-tc.gc.ca/en/home.html.
1009
Competition Tribunal Practice Directions
The Tribunal will continue to hear urgent matters, but only by telephone confer-
ence. All scheduled deadlines as well as hearings, including hearings of motions,
currently scheduled for after April 17, 2020, are maintained. For the time being,
requests for extensions of time will be dealt with on a case-by-case basis. The Tri-
bunal strongly encourages counsel and the parties to work together when seeking
extensions of time.
Updates on Tribunal Website and Flexibility

The Tribunal recognizes that the situation is constantly evolving and information
on any changes to the Tribunal’s operations will be posted on the Tribunal website.
The Tribunal is committed to being exible in assisting the parties and the public in
dealing with this situation. Please do not hesitate to contact the Tribunal Registry
should you have any further questions.
We appreciate your patience and thank you for your understanding and collabora-
tion during these challenging times.
Justice Denis Gascon
Chairperson
UPDATED NOTICE NO. 1 REGARDING THE COVID-19

PANDEMIC (APRIL 15 2020)*
The Competition Tribunal continues to monitor the evolving COVID-19 situation

and to take measures to protect the health and safety of employees, parties and the
public. Given the current government and public health information, and the devel-
opments that have taken place since the Tribunal issued its previous Notice regard-
ing the COVID-19 Pandemic on March 18, 2020 (“March Notice”), the Tribunal
now puts the following revised measures in place, effective immediately. This up-
dated Notice supersedes and replaces the Tribunal’s March Notice.
Suspension Period
The period during which certain activities of the Tribunal are suspended, which
was scheduled to end on April 17, 2020, is extended for a further four weeks and
now runs until May 15, 2020 (“Suspension Period”).
* Updated Notice No. 1 Regarding the COVID-19 Pandemic, (April 15, 2020), https://www.
ct-tc.gc.ca/en/procedure/notices/covid19-april.html. Reproduced with the permission of the
Competition Tribunal Secretariat of the Competition Tribunal, 2020. This document is
subject to change without notice. For the most current version of the document refer to the
Competition Tribunal website: https://www.ct-tc.gc.ca/en/home.html.
1010
Updated Notice No. 1 regarding the COVID-19 Pandemic (April 15 ...

During the Suspension Period, the Tribunal remains open for business but the Tri-
bunal premises are closed to the public. Tribunal Members and employees are
equipped to work remotely and continue to provide services to the parties and the
public, as required.

of the Competition Tribunal Rules (“Rules”). The Tribunal does not allow paper
filing during the Suspension Period
Timelines and Tribunal Hearings

During the Suspension Period:
• There will be no in-person hearings.
• The Tribunal will continue to hear urgent matters, but only by telephone or
video conference. The Tribunal will determine what constitutes an “urgent”
matter on a caseby-case basis.
• The Tribunal will also hear other matters if all parties consent to it and agree
to have the matter heard by telephone or video conference.
• Parties can continue to file new applications with the Tribunal.
• The running of all timelines in the Rules which establish periods of time
within which a step must be taken in a Tribunal proceeding is suspended, un-
less the matter is urgent or the parties agree to the matter advancing during the
Suspension Period. For greater clarity, the Tribunal notes that the statutory
deadlines for commencing applications under the Competition Act continue to
apply during the Suspension Period.
Directions
Practice
• With respect to hearings and other procedural steps that are scheduled to take
place during the Suspension Period in accordance with a Tribunal Order or
Direction issued before March 18, 2020, the Tribunal will reach out to counsel
and the parties and will set up, if and as needed, a case management confer-
ence in order to determine next steps. The Tribunal encourages counsel and
the parties to work together when seeking extensions of timelines scheduled in
Tribunal Orders and Directions.

The Tribunal is committed to being flexible in assisting the parties and the public in
1011
Chairperson

PANDEMIC (MAY 15 2020)*

opments that have taken place since the Tribunal issued its Updated Notice regard-
ing the COVID-19 Pandemic on April 15, 2020 (“April Notice”), the Tribunal now
puts the following revised measures in place, effective immediately. This new up-
dated Notice supersedes and replaces the Tribunal’s April Notice.
Suspension Period
The period during which certain activities of the Tribunal are suspended, which
was scheduled to end on May 15, 2020, is extended for a further four weeks and
now runs until June 12, 2020 (“Suspension Period”).

During the Suspension Period, the Tribunal remains open for business but the Tri-
bunal premises are closed to the public. Tribunal Members and employees are
equipped to work remotely and continue to provide services to the parties and the
public.

of the Competition Tribunal Rules (“Rules”). The Tribunal does not allow paper
filing during the Suspension Period.
* 1. Updated Notice No. 2 Regarding the COVID-19 Pandemic, (May 15, 2020),
https://www.ct-tc.gc.ca/en/procedure/notices/covid19-may.html. Reproduced with the
permission of the Competition Tribunal Secretariat of the Competition Tribunal, 2020. This
document is subject to change without notice. For the most current version of the document
refer to the Competition Tribunal website: https://www.ct-tc.gc.ca/en/home.html.
1012
Updated Notice No. 2 regarding the COVID-19 Pandemic (May 15 2020)

During the Suspension Period:
• There will be no in-person hearings.
• The Tribunal will continue to hear urgent matters, but only by telephone or
video conference. The Tribunal will determine what constitutes an “urgent”
matter on a case-by-case basis. Recently, the Tribunal held that an application
for a temporary order brought by the Commissioner of Competition pursuant
to section 74.11 of the Competition Act constituted an urgent matter.
• The Tribunal will also hear other matters if all parties consent to it and agree
to have the matter heard by telephone or video conference.
• Parties can continue to file new applications with the Tribunal.
• The running of all timelines in the Rules which establish periods of time
within which a step must be taken in a Tribunal proceeding is suspended, un-
less the matter is urgent or the parties agree to the matter advancing during the
Suspension Period. For greater clarity, the Tribunal notes that the statutory
deadlines for commencing applications under the Competition Act continue to
apply during the Suspension Period.
• With respect to hearings and other procedural steps that are scheduled to take
place during the Suspension Period in accordance with a Tribunal Order or
Direction issued before March 18, 2020, the Tribunal will reach out to counsel
and the parties and will set up, if and as needed, a case management confer-
ence in order to determine next steps. The Tribunal encourages counsel and
the parties to work together when seeking extensions of timelines scheduled in
Tribunal Orders and Directions.

Directions
Practice
Chairperson
1013

PANDEMIC (JUNE 12 2020)*

opments that have taken place since the Tribunal issued its Updated Notice No. 2
regarding the COVID-19 Pandemic on May 15, 2020 (“May Notice”), the Tribunal
now puts the following revised measures in place, effective immediately.
Suspension Period
The Suspension Period (as the term was defined in the May Notice) expires at the
end of the day on June 12, 2020. This means that the running of timelines set out in
the Competition Tribunal Rules (“Rules”) is no longer suspended and parties are
expected to comply with those timelines. The Tribunal continues to encourage
counsel and the parties to work together when seeking extensions of timelines
scheduled in Tribunal Orders and Directions.
Competition Tribunal Oces

The Tribunal is open for business but the Tribunal premises remain closed to the
public. Tribunal Members and employees are equipped to work remotely and con-
tinue to provide services to the parties and the public.

The Tribunal’s electronic ling system is fully operational and parties should con-
tinue to le their documents by electronic transmission in accordance with Rule 12.
The Tribunal does not allow paper ling until further notice.

There will be no in-person hearings until further notice. The Tribunal is looking at
different ways to resume in-person hearings while safeguarding the health and
safety of employees, parties and the public.
For the time being, all Tribunal matters will be heard remotely by way of either
telephone or videoconference. In addition to urgent matters, the Tribunal will now
be ready to hear all other matters. Parties can continue to le new applications with
the Tribunal.
* 1. Updated Notice No. 3 Regarding the COVID-19 Pandemic, (June 12, 2020),
https://www.ct-tc.gc.ca/en/procedure/notices/covid19-june.html. Reproduced with the
1014
Practice Direction Regarding an Expedited Proceeding Process

Chairperson
PRACTICE DIRECTION REGARDING AN EXPEDITED

PROCEEDING PROCESS BEFORE THE TRIBUNAL*
January 2019
The purpose of this Practice Direction is to introduce an indicative timeline for an
expedited proceeding process (“Expedited Process”) that parties may contemplate
and propose depending on the specific circumstances of a particular matter, subject
to overall approval by the Competition Tribunal. This Practice Direction reflects
what the Tribunal considers to be a reasonable time frame for an Expedited Pro-
cess. For greater certainty, the timeline set forth below should be viewed as a
guideline. It may be varied by the judicial member responsible for the case man-
agement of a given matter, depending on the circumstances of each case.
This Practice Direction is being issued in furtherance of the Tribunal’s general ob-
jective of continuing to improve the efficiency and effectiveness of its proceedings.
It is also consistent with the Tribunal’s statutory mandate to deal with matters as
“informally and expeditiously as the circumstances and considerations of fairness
permit”, pursuant to subsection 9(2) of the Competition Tribunal Act, RSC 1985, c
Directions
Practice
19 (2nd Supp). This Expedited Process was developed pursuant to consultations

with the Commissioner of Competition (“Commissioner”) and the Canadian Bar
Association (“CBA”) through the Tribunal/Bar Liaison Committee.
Availability
The Tribunal will likely adopt the Expedited Process if all parties consent to it in a
particular proceeding. The Tribunal may also adopt the Expedited Process even if
only one of the parties requests it. In such a case, the requesting party would need
* Practice Direction Regarding an Expedited Proceeding Process before the Tribunal,

(January 2019), https://www.ct-tc.gc.ca/en/procedure/practice/expedited-proceeding.html.
Reproduced with the permission of the Competition Tribunal Secretariat of the Competition
Tribunal, 2020. This document is subject to change without notice. For the most current
version of the document refer to the Competition Tribunal website: https://www.ct-tc.gc.ca/
en/home.html.
1015
to satisfy the Tribunal that the Expedited Process is reasonable and advisable in
light of the circumstances of the particular matter and considerations of fairness.
When considering the circumstances and the considerations of fairness in a given
case, the Tribunal may take into account various factors, including the following:
• Whether there is any informational advantage or disadvantage that exists be-
tween the parties;
• The complexity of the proceedings (including the number of issues that may
be in dispute between the parties);
• Any relevant commercial imperatives for the use of the Expedited Process,
such as material timing considerations;
• Any other relevant imperatives, such as the amount of time the alleged anti-
competitive practice or arrangement has been in place and the extent of the
alleged harm to competition in the relevant market;
• In matters involving deceptive marketing practices under Part VII.1 of the
Competition Act, RSC 1985, c C-34 (“Act”), the frequency and duration of the
alleged conduct, the vulnerability of the class of persons likely to be adversely
affected by the alleged conduct and the effect of the alleged conduct on com-
petition in the relevant market;
• The availability and use of any interim or injunctive measures in respect of the
conduct at issue, as well as the nature of the remedy that is being sought; and
• Whether the party requesting the Expedited Process is willing to reduce or
eliminate certain procedural steps (such as elements of the discovery process)
to facilitate expedition.
For greater certainty, the foregoing factors will not fetter the Tribunal’s discretion
or override a legislative direction, and will be developed more precisely over time
through the jurisprudence.
Although it has been suggested that the Expedited Process may be better suited for
applications in relation to mergers (where time is often of the essence), the Tribunal
considers that the Expedited Process is an option available for all types of applica-
tions filed before it, and may also be well-suited for cases under the other review-
able practices provisions in Part VIII of the Act as well as under Part VII.1.
Timeline
The Tribunal considers that a period of five (5) to six (6) months between the filing
of a Notice of Application (“NOA”) and the commencement of the hearing on the
merits will typically be a reasonable timeline for the Expedited Process, subject in
each case to the nature of the particular application. The Tribunal expects that the
timetables proposed by the parties for the disposition of an application under this
process will generally fall within this time frame. The Tribunal will aim to issue
scheduling orders that contemplate completing the various discovery and pre-hear-
ing steps under the Expedited Process within this overall timeline. In this regard,
the detailed steps to be followed by the parties and the Tribunal are described in the
1016
indicative timeline for the Expedited Process set out in Appendix A. For greater
certainty, the Tribunal recognizes that there may be circumstances where the par-
ties may consider a five (5) to six (6) months period to be too long or too short. In
such circumstances, they shall remain free to propose and agree to an alternative
timetable.
The indicative timeline for the Expedited Process complements the timeline set out
in the Tribunal’s Practice Direction regarding Timelines and Scheduling for Pro-
ceedings Before the Tribunal (“Practice Direction regarding Scheduling”) for the
regular proceeding processes before the Tribunal, and offers an additional avenue
along the spectrum of options for proceedings before the Tribunal.
Initial Notice to the Tribunal

If all parties agree to proceed under the Expedited Process, the applicant shall no-
tify the Tribunal accordingly at the same time as a NOA is filed. Upon receipt of
such notice of consent to the Expedited Process, the Tribunal will convene a case
management conference (“CMC”) on an urgent basis to approve the use of the Ex-
pedited Process in the circumstances of that particular matter.
A notice of consent to the Expedited Process does not necessarily mean that the
parties will be obliged to adopt all aspects of the indicative timeline described in
Appendix A. However, the parties will generally be expected to respect the expe-
dited deadlines associated with the filing of the pleadings (i.e., Response and Re-
ply). The actual expedited scheduling order, including all other discovery and pre-
hearing steps, will be finalized as part of the opening case management conference
(“Opening CMC”) to be convened shortly after the pleadings have closed.
Where all parties do not agree that an Expedited Process should be followed, the
party proposing its adoption shall notify the Tribunal that it intends to seek an ex-
pedited scheduling order within five (5) days after the filing of the NOA. In those
circumstances, the Tribunal will convene a CMC on an urgent basis to assess
whether the Expedited Process is a reasonable and advisable option given the cir-
Directions
Practice
cumstances of that particular matter and having regard to considerations of proce-

dural fairness and other related factors described above.
Opening CMC
As indicated in the Tribunal’s Practice Direction regarding Scheduling, the Tribu-
nal will take an active role in the case management of its proceedings. This will be
particularly so in the context of the Expedited Process. Accordingly, when an appli-
cation proceeds under the Expedited Process, the Tribunal will convene an in-per-
son Opening CMC within 14 days after the close of pleadings.
From a procedural perspective, the main purpose of the Opening CMC will be to
finalize the draft scheduling and confidentiality orders which will have been previ-
ously submitted by the parties (i.e., within seven (7) days after the close of plead-
ings). It is anticipated that an early finalization of the confidentiality order will also
limit issues concerning privilege and confidentiality classification.
1017
The timetable to be proposed by the parties shall incorporate deadlines for serving
the parties’ affidavits of documents (“AODs”), completing examinations for dis-
covery, serving their witness statements and expert reports, exchanging requests for
admissions, and other steps set out in Appendix A. If counsel cannot agree on a
timetable, separate submissions shall be made in advance of the Opening CMC.
In addition to finalizing the scheduling and confidentiality orders, the Tribunal will
also address, at the Opening CMC, the discovery plans of the parties. Such discov-
ery plans should generally have been exchanged between the parties within seven
(7) days after the close of pleadings. It is expected that potential disputes with re-
spect to documentary disclosure and examinations for discovery will be reduced
through the use of discovery plans. The discovery plans should generally:
• Identify and prioritize key topics, custodians, record types, relevant time
frames and other parameters within which the production will be conducted
for relevant records;
• Consider anticipated volume of records, cost and resources required to search
for and review records for relevance, and the importance and complexity of
the issues;
• Identify persons intended to be produced for oral examination for discovery in
the relevant proceeding and include information respecting the timing and
length of the examinations;
• Prioritize steps to be taken and consider whether a phased approach would be
appropriate; and
• Consider whether to reduce or eliminate certain procedural steps (such as ele-
ments of the discovery process) to facilitate expedition.
Any disagreements arising from the exchange of the discovery plans shall be dealt
with by the Tribunal at the Opening CMC.
The Tribunal will also use the Opening CMC to raise any other procedural and/or
substantive issues that may “aid in the disposition of the application” (Rule 137 of
the Competition Tribunal Rules, SOR/2008-141 (“Rules”)), and it will expect all
parties to do the same. Other areas that may be explored at the Opening CMC to
achieve efficiency may include:
• Document management;
• The use of an agreed statement of facts;
• The use of references to dispose of discrete issues; and
• The use of agreed books of documents and joint briefs of authorities.
The Tribunal will also take the opportunity afforded by the Opening CMC to ac-
tively identify certain issues or sub-issues that, if adjudicated and/or otherwise re-
solved early on, would lead to a more efficient and effective proceeding. As such,
in addition to proactively examining the pleadings for such issues, the Tribunal
expects the parties will do the same.
1018
Approach to Case Management

Throughout the discovery and pre-hearing steps leading to the hearing on the mer-
its, the Tribunal will take an active role in the scheduling and case management of
the Expedited Process. The following guidance explains how the Expedited Process
will be managed in the absence of exceptional reasons for departing from this gen-
eral approach.
The parties will be expected to reasonably cooperate and agree on expediting dis-
covery and pre-hearing steps, as well as the hearing itself, including with respect to
documentary discovery, examinations for discovery, and the presentation of evi-
dence in a manner that could streamline the hearing.
Counsel should ensure that they will be reasonably available for CMCs, to com-
plete discoveries on a timely basis, and for an expedited hearing.
While the Tribunal will endeavour to make a judicial member available to preside
over CMCs or to deal with motions, counsel will be expected to have conferred
among themselves before requesting any CMC or bringing any motion. The judi-
cial member responsible for the case management of a given matter may require
that a CMC be held before any motion is brought. The Tribunal specifies that the
judicial member to be made available may not be the judicial member responsible
for the case management of the matter.
Applications for Leave to Intervene

Under the Expedited Process, the Tribunal will deal with intervenor applications in
accordance with the following expedited schedule and process:
• Motion for leave to intervene would be served and filed within seven (7) days
after the end of the period for filing the Response;
• Motion Response would be served and filed within four (4) days after the ser-
vice of the Motion;
Directions
• Motion Reply would be served and filed within two (2) days after the service
Practice
of the Motion Response; and

• Intervention will be disposed of by the Tribunal without a hearing unless the
Tribunal directs otherwise.
As soon as the Tribunal determines that an application will be dealt with under the
Expedited Process, a notification to that effect will be immediately posted on the
Tribunal’s website. Such notification will indicate that the application will proceed
under the Expedited Process and will set out the date by which motions for leave to
intervene are to be filed. Rule 25 provides that, in case of a NOA under Part VIII of
the Act, the Registrar is to publish a notice in the Canada Gazette and, over a
period of two weeks, in two daily newspapers. Such notice must set out, among
other things, the date by which a motion for leave to intervene is to be filed. In the
context of the Expedited Process, the Tribunal will likely dispense with the applica-
tion of this provision, and use the above notification on the Tribunal’s website as an
alternative notification process.
1019
Mediation
As indicated in the Tribunal’s Practice Direction regarding Mediation, “[p]arties
should expect that, in all proceedings, the Tribunal will also be proactive in explor-
ing the prospects for mediation during the early and later stages of the case man-
agement process”.
In light of this guidance, and as proposed by both the Commissioner and the CBA,
the Tribunal has allotted two optional steps for mediation in its indicative timeline
for the Expedited Process: 1) after the close of pleadings but prior to commencing
the discovery process; and 2) after discovery and disclosure (e.g., service of witness
statements), but before the hearing on the merits commences.
Given its success thus far, the Tribunal will continue to encourage the parties to
engage in mediation. To that end, the Tribunal is willing to facilitate the process of
mediation in accordance with its mediation protocol.
Discovery Process
In addition to the implementation of a rigorous Opening CMC, the Tribunal is of
the view that the best way to expedite its proceedings is to apply certain parameters
and limitations to the discovery process.
As indicated above, the first of these measures is requiring the parties to exchange
discovery plans which should preclude, or at least reduce the number of, motions
associated with documentary and oral discovery following production of
documents.
The second measure is the expectation that the parties will generally exchange the
AODs within a period of 60 to 70 days after the filing of the NOA. The parties are
encouraged to examine ways to limit the scope of documentary discovery in order
to facilitate expedition. Updated AODs will also have to be provided by the parties
in accordance with their obligation to make continuous disclosure. If needed, direc-
tions to that effect will be set by the judicial member responsible for the case man-
agement of the matter.
Furthermore, with the consent of the affected parties (not to be unreasonably with-
held), the Commissioner will not be required to produce in his/her AOD those doc-
uments that have been received from a respondent, including documents submitted
to the Commissioner by the parties in response to a request for information, section
11 order(s), supplementary information requests or provided voluntarily. Con-
versely, with the consent of the Commissioner (not to be unreasonably withheld), a
respondent will not be required to produce in its AOD those documents that have
already been provided to the Competition Bureau.
As a third measure, the Tribunal also adopts certain parameters and limits associ-
ated with examinations for discovery set out in the Federal Court’s Notice to the
Parties and the Profession regarding Case Management: Increased Proportional-
1020
ity in Complex Litigation before the Federal Court. These parameters and limits
will apply to all examinations for discovery:
• No refusals motion will be permitted until oral discoveries are completed, al-
though as discussed below, a judicial member of the Tribunal may adjudicate
on “spot objections” in appropriate circumstances;
• Refusals motions will be limited to one (1) hour per day of discovery of each
party’s representative;
• Potentially significant cost sanctions may be imposed against unsuccessful or
unreasonable parties; and
• Questions should be answered unless clearly improper, or where the disclosure
of privileged communication could result. In all other situations, questions
considered by a party to be objectionable will be required to be answered
under objection, with reasons to be stated on the record.
The Tribunal further expects that, in examinations for discovery, counsel will take
questions “under advisement” on an exceptional basis and that the number of such
questions will therefore be limited.
Unless the parties agree otherwise or the Tribunal allows additional days in light of
the particular circumstances of a given matter, oral discovery shall normally be
limited to two (2) days for each of the applicant(s) and the respondent(s). In addi-
tion, in order to facilitate the oral discovery process and to reduce potential lengthy
delays associated with discovery motions, the Tribunal will make a judicial mem-
ber available, either in person or via teleconference, to adjudicate “spot objections”
raised during examinations for discovery.
The purpose of these guidelines is to ensure a focused, effective approach to oral
discovery by the parties, an efficient use of the Tribunal’s resources and appropri-
ate proportionality in proceedings before the Tribunal.
For greater certainty, the principle of proportionality applies to all stages of an ap-
Directions
plication, including oral discoveries. However, departures from the Rules or from
Practice
the terms of this Practice Direction on the basis of proportionality shall require the
prior approval of the Tribunal.
Pre-hearing Process
The indicative timeline provides that all parties are to serve their respective witness
statements, expert reports and documents relied upon at the same time, for both the
initial filings and the reply filings. Simultaneously with the service of expert re-
ports, the parties shall specify the subject areas in which they propose to qualify
their respective expert witnesses. The Tribunal notes that, in merger cases where an
efficiencies defense is raised, the foregoing sequence for the exchange of expert
reports may require adjustments.
Any objections regarding a proposed expert, including regarding his/her qualifica-
tions; the area(s) in respect of which he/she is proposed to be qualified; and his/her
expert report more generally should be raised as soon as possible with the judicial
member responsible for the case management of the matter, and in any event,
1021
within 15 days of service and filing of the expert reports. The Tribunal expects that,
in most cases, there will be no objections and the parties will agree to the scope of
expertise of each expert witness. Where agreement is reached, short written state-
ments of the proposed area of expertise for each expert witness shall be exchanged
and provided to the Tribunal. Where disagreement remains, the issues will be ex-
pected to be raised and resolved under case management, save and except for those
instances where the presence of the expert before the Tribunal is required in order
for an issue to be resolved. In such a case, the issue will be addressed at a time and
in a manner directed by the judicial member responsible for the case management
of the matter.
The parties are also expected to prepare a joint statement of issues, to be delivered
two (2) weeks prior to the hearing on the merits. For those issues upon which
agreement cannot be reached, the parties shall each deliver their own statement to
the Tribunal.
A proposed schedule for hearing proceedings, including the order and estimated
duration of the testimony of witnesses and opening statements, shall be submitted
to the Tribunal at least one (1) week prior to the hearing. Any disagreement with
respect to the schedule will be decided by the presiding judicial member after hear-
ing from the parties.
Read-ins from discovery will be taken as read in and marked as exhibits at the
hearing, subject to objections in writing by the opposing party and/or qualifications
to the read-ins prior to the end of the hearing. Parties are encouraged to share lists
of anticipated read-ins at least one (1) week before the hearing. Read-ins should be
grouped by subject matter.
Final written arguments and compendia of key documents in both electronic and
paper format shall be provided to the Tribunal, and shall include only the relevant
excerpts of evidence to be relied upon by each party. Best efforts should be made to
provide a joint compendium. Otherwise, separate compendia shall be provided to
the Tribunal. The length of final written arguments and compendia shall be deter-
mined by the Tribunal after hearing from the parties.
Hearing Process
The hearing will adopt the “chess clock” process set out in the Tribunal’s Notice on
‘Chess Clock’ Proceedings, and will generally conform to the following guidelines:
• The evidentiary portion of the hearing will generally be limited to 5–7 days,
with limited oral examinations in-chief;
• Oral argument will generally be limited to 1-2 days.
Decision
Although nothing in this Practice Direction shall bind the Tribunal, the Tribunal
will aim to issue its decision within one (1) month after oral argument.
1022
For any additional information or assistance, please contact the Deputy Registrar at
(613) 954-0857.
Chairperson
Appendix A — Indicative Timeline for the Expedited

Process
Step Timing Day

Notice of Application (“NOA”) 1
Case Management Conference
Convened within 7 days of the
(“CMC”) to determine if the Expe- 8
NOA
dited Process applies
Notification of Expedited Process on Posted within 2 days of the
10
the Tribunal’s website CMC
Filed within 14 days of the
Response 15
NOA
Filed within 7 days of the Re-
Reply 22
sponse
Filing of Proposed Confidentiality
and Scheduling Orders Filed or completed within 7
29
Exchange of Discovery Plans be- days of the Reply
tween the Parties
Convened within 7 days of fil-
Opening CMC (“Opening CMC”) ing of Proposed Confidentiality 36
and Scheduling Orders
Directions
Practice
Possibility of a second CMC to dis- Convened within 7 days of the

43
cuss Discovery Plans Opening CMC
Issuance of Confidentiality and
Within 10 days of the Opening
Scheduling Orders by the Tribunal 46
CMC
and approval of the Discovery Plans
Mediation (Optional) If requested by the parties —
DISCOVERY PROCESS
Service of Affidavits of Documents
Served within 60 to 70 days of
(“AODs”) and delivery of docu- 60–70
the NOA
ments by the parties
Within 20 days of service of
Completion1 of AOD motions 80–90
the AODs
1023
Step Timing Day

Examinations for discovery of Ap-
Completed within 30 to 45
plicant’s and Respondent’s repre- 90–115
days of service of the AODs
sentatives
Completion of discovery motions
Completed within 15 days of
(productions, claims of privilege, re- 105–130
examinations for discovery
fusals or answers to undertakings)
PRE-HEARING PROCESS
Parties to serve their initial
witness statements, expert re-
Witness Statements, Expert Reports ports and documents relied up-
and Documents Relied Upon (“Ini- on (within 15 to 20 days after 120–150
tial Filings”) completion of discovery pro-
cess), and to file their expert
reports
Parties to serve their witness
statements, expert reports and
Witness Statements, Expert Reports
documents relied upon in re-
and Documents Relied Upon in re- 135–165
sponse (within 15 days after
sponse (“Response Filings”)
the Initial Filings) and to file
their expert reports in response
Deadline for delivering any Requests Within 15 days after the Initial
135–165
for Admissions Filings
Convened within 10 days after
Pre-hearing CMC 145–175
the Response Filings
Admissions or deemed admissions
To be received within 10 days
Commissioner to serve his/her list of
after service of Requests for 145–175
documents proposed to be admitted
Admissions
without further proof
Deadline to provide to the Tribunal
documents for use at the hearing
(e.g., witness statements, anticipated Within 10 days after the Re-
145–175
read-ins from examinations for dis- sponse Filings
covery, agreed books of documents,
and joint briefs of authorities)
If requested by the Parties,
Mediation (Optional) within 14 days of completion –
of the Response Filings
1024
Practice Direction Regarding Timelines and Scheduling
Step Timing Day

To start 5 days after Pre-hear-
ing CMC, with 5 to 7 days for
Hearing on the merits 150–180
the evidentiary portion and 1 to
2 days for argument
Within 30 days after oral argu-
Decision 190–220
ment
Notes:
1 Completion means filed, argued, decided and complied with.
Date Modified: 2008-12-14
PRACTICE DIRECTION REGARDING TIMELINES AND

SCHEDULING FOR PROCEEDINGS BEFORE THE
TRIBUNAL*
January 2019
The purpose of this Practice Direction is to advise parties and counsel appearing
before the Competition Tribunal about the timelines that will ordinarily be expected
to be followed in proceedings before the Tribunal. In addition, this Practice Direc-
tion provides guidance to parties and counsel in the establishment of time frames
for the principal discovery and pre-hearing steps leading to a hearing. Furthermore,
pursuant to consultations with the Commissioner of Competition (“Commissioner”)
and the Canadian Bar Association through the Tribunal/Bar Liaison Committee, the
Tribunal will be taking a more active role in the case management of its proceed-
Directions
ings. This specifically includes the review of proposed scheduling orders, including
Practice
those submitted with the consent of all parties.

This Practice Direction is being issued in furtherance of the Tribunal’s general ob-
jective of continuing to improve the efficiency and effectiveness of its proceedings.
Timelines
The Tribunal considers that a period of 10 to 16 months between the filing of a
Notice of Application and the commencement of the hearing on the merits will
typically be a reasonable timeline for its proceedings, subject in each case to the
* Timelines and Scheduling for Proceedings, (January 2019), https://www.ct-tc.gc.ca/en/

procedure/practice/timelines-scheduling.html. Reproduced with the permission of the
1025
nature of the particular application. The Tribunal expects that the timetables pro-
posed by the parties for the disposition of an application will generally establish a
schedule falling within this time frame. Such a schedule should contemplate com-
pleting the various discovery and pre-hearing steps of the proceeding within this
period of time. Where a party seeks to depart from this timeline, it shall, as soon as
possible, provide an explanation to the Tribunal.
For greater certainty, the Tribunal emphasizes that the overall timeline of 10 to 16
months should not be considered as fixed. Some flexibility is contemplated and the
timeline may be varied and extended, depending on the particular context, urgency
or circumstances of each case. In addition, the Tribunal’s own scheduling require-
ments could lead to an extension of the timeline.
The Tribunal notes that factors that have led to an extension of the timelines in the
past have included motions for leave to intervene, motions for summary dismissal
or summary disposition, motions challenging the Tribunal’s subject-matter or per-
sonal jurisdiction, motions opposing claims of privilege and motions seeking a stay
of Tribunal proceedings pending appeal on a preliminary motion or on a related
matter. The Tribunal will also generally assess whether the proposed timetables are
realistic and achievable for the parties involved. The Tribunal emphasizes, how-
ever, that the presence of any one or more of these circumstances does not necessa-
rily mean that an extension will be granted. This will be assessed on a case-by-case
basis.
The Tribunal may issue directions and orders that will not always reflect what the
parties have proposed in terms of scheduling. This could even occur in respect of a
proposal made on consent, if it falls outside the overall timeline of 10 to 16 months
and if the Tribunal is of the view that the proposal is not in line with its statutory
mandate to deal with matters as “informally and expeditiously as the circumstances
and considerations of fairness permit”, pursuant to subsection 9(2) of the Competi-
tion Tribunal Act, RSC 1985, c 19 (2nd Supp).
Discovery and Pre-hearing Steps

When preparing their proposed timetables for the disposition of an application, the
parties and counsel should keep in mind the following elements in determining how
the time should be best allocated between the various discovery and pre-hearing
steps, within the above timeline:
A. Documentary discovery
a. service of affidavits of documents;
b. motions arising from the affidavits of documents and productions;
c. motions arising from claims of privilege and/or confidentiality
designations.
B. Oral discovery
a. examinations for discovery;
b. motions arising from the examinations for discovery, answers to un-
dertakings or refusals.
1026
C. Pre-hearing processes
a. service and/or filing of documents relied upon, witness statements and
expert reports;
b. motions for summary disposition;
c. motions arising from the waiver of privilege;
d. requests for admissions;
e. motions related to the evidence (documents relied upon, witness state-
ments and expert reports).
The parties are also encouraged to exchange discovery plans which should gener-
ally: 1) identify and prioritize key subjects, custodians, record types, relevant time
frames and other parameters within which the production will be conducted for
relevant records; 2) consider anticipated volume of records, cost and resources re-
quired to search for and review records for relevance, and the importance and com-
plexity of the issues; 3) identify persons intended to be produced for oral examina-
tion for discovery in the relevant proceeding and include information respecting the
timing and length of the examinations; and 4) prioritize steps to be taken and con-
sider whether a phased approach would be appropriate.
The above discovery and pre-hearing steps will normally be included in the sched-
uling orders to be issued by the Tribunal. A more complete list of the usual discov-
ery and pre-hearing steps is detailed in Appendix A. In addition to the case man-
agement conferences already mentioned in Appendix A, the judicial member
responsible for the case management of a given matter will be available for addi-
tional case management conferences should the parties or the circumstances require
it.
Approach to Case Management

Throughout the discovery and pre-hearing steps, the Tribunal will take an active
role in the scheduling and case management of its proceedings.
Directions
Practice
Based on its experience in recent proceedings, the Tribunal notes the following.
With respect to the documentary discovery process, the time allotted to serve the
affidavits of documents has typically been four (4) to six (6) months after the filing
of the Notice of Application. The Tribunal considers that, in many instances, affi-
davits of documents could and should be served earlier and closer to the close of
pleadings. In the Tribunal’s view, a period of three (3) months after close of plead-
ings should normally be sufficient for the service of affidavits of documents. In this
regard, the principle of proportionality shall apply in determining the scope of doc-
umentary discovery. A reduced period for the service of affidavits of documents
would leave more time to deal with motions arising from the affidavits of docu-
ments and productions, as well as motions arising from claims of privilege and/or
confidentiality designations. While the situation may vary with each individual
matter, the Tribunal observes that, in the Commissioner’s case, he/she will have
had extensive familiarity with the evidence. The Tribunal would thus expect
him/her to generally be in a position to deliver the affidavit of documents within
1027
the period mentioned above. The same would apply to the responding party in
cases where there have been pre-application dealings with the Commissioner.
Regarding oral discovery, in order to facilitate the process and to reduce the ad-
verse consequences of lengthy delays associated with discovery motions, the Tribu-
nal will make a judicial member available, either in person or via teleconference, to
adjudicate “spot objections” raised during examinations for discovery.
The Tribunal also adopts certain parameters and limits associated with examina-
tions for discovery set out in the Federal Court’s Notice to the Parties and the
Profession regarding Case Management: Increased Proportionality in Complex
Litigation before the Federal Court. These parameters and limits will apply to all
examinations for discovery:
• No refusals motion will be permitted until oral discoveries are completed, al-
though as discussed above, a judicial member of the Tribunal may adjudicate
on “spot objections” in appropriate circumstances;
• Refusals motions will be limited to one (1) hour per day of discovery of each
party’s representative; Potentially significant cost sanctions may be imposed
against unsuccessful or unreasonable parties; and
• Questions should be answered unless clearly improper, or where the disclosure
of privileged communication could result. In all other situations, questions
considered by a party to be objectionable will be required to be answered
under objection, with reasons to be stated on the record.
The Tribunal further expects that, in examinations for discovery, counsel will take
questions “under advisement” on an exceptional basis and that the number of such
questions will therefore be limited.
As far as pre-hearing processes are concerned, the Tribunal notes that the timelines
set forth in the Competition Tribunal Rules, SOR/2008-141 (“Rules”) for the ser-
vice of the witness statements, list of documents on which a party intends to rely
and expert reports (i.e., applicant’s case 60 days before the hearing, respondent’s
case 30 days before the hearing, and applicant’s reply 15 days before the hearing)
have sometimes proved to be too tight when motions are filed in connection with
the waiver of privilege or in relation to the evidence. The Tribunal considers that it
will generally be advisable for parties and counsel to provide for more time than is
currently contemplated in the Rules for the exchange of the parties’ cases.
The Tribunal would also like to remind parties and counsel that Rule 40(1) requires
parties to provide their proposed timetable within 14 days after the expiry of the
period for filing a response. As this requirement seems to have sometimes not been
followed in practice, the Tribunal wishes to reinforce the importance of this Rule in
order to prevent any delay in establishing the timeline for the disposition of an
application and in issuing a scheduling order.
Finally, the Tribunal would like to advise parties and counsel that, in its scheduling
orders, the Tribunal now typically requires the parties to (i) file their expert reports
with the Tribunal at the same time as they serve them to opposing counsel, and (ii)
provide their witness statements to the Tribunal ahead of the hearing. This will
1028
provide the Tribunal with additional time to review the materials before the hear-
ing, thus allowing the Tribunal to be better prepared and to potentially resolve cer-
tain issues earlier. It is expected that this will also generally assist to expedite the
proceedings. In this regard, the Tribunal is mindful of Rules 74(3) and 78(2) which
provide that the Tribunal may read the witness statements or expert reports, respec-
tively, “unless a party makes a valid objection”. Nothing in this Practice Direction
shall be read or interpreted as precluding a party from raising such an objection.
(613) 954-0857.
Chairperson
Appendix A — List of Potential Discovery and Pre-hearing

Steps
Notice of Application
Response
Reply
Filing of proposed timetable(s) by the parties
Filing of proposed confidentiality order(s) by the parties
Exchange of discovery plans
Case Management Conference to discuss scheduling and confidentiality orders,
as well as discovery plans
Service of Affidavits of Documents and delivery of documents by the parties
Filing of any motions arising from Affidavits of Documents and/or productions,
Directions
Practice
including motions challenging claims of privilege

Hearing of motions arising from Affidavits of Documents, productions or claims
of privilege
Delivery of any additional productions resulting from Affidavits of Docu-
ments/productions/claims of privilege motions
Mediation (could be prior to or after discovery)
Examinations for discovery
Deadline for fulfilling answers to discovery undertakings
Filing of any motions arising from examinations for discovery, answers to un-
dertakings or refusals
Hearing of motions arising from examinations for discovery, answers to under-
takings or refusals
1029
Follow-up examinations for discovery, if any

Case Management Conference on pre-hearing steps and any preliminary issues
Filing of any motions for summary disposition
Hearing of motions for summary disposition
Applicant to serve its documents relied upon and witness statements, and to
serve and file its expert reports
Applicant to indicate documents on which privilege is waived
Commissioner to serve his/her list of documents proposed to be admitted with-
out further proof
Filing of any motions for further examination for discovery following waivers of
privilege
Hearing of motions for further examination for discovery following waivers of
privilege
Respondent to serve its documents relied upon and witness statements, and to
serve and file its expert reports
Deadline for delivering any requests for admissions
Deadline for delivering any agreed statement of facts
Applicant to serve its reply documents relied upon and reply witness statements,
and to serve and file its reply expert reports
Filing of any motions related to the evidence (documents relied upon, witness
statements and expert reports)
Pre-hearing Case Management Conference
Deadline to provide documents to the Tribunal for use at the hearing (e.g.,
witness statements, agreed books of documents, and joint briefs of authorities).
Parties will generally be expected to provide anticipated read-ins from examina-
tions for discovery simultaneously with the foregoing documents
Deadline for responding to any requests for admissions
Hearing of motions related to the evidence (documents relied upon, witness
statements and expert reports)
Hearing on the merits
Date Modified:2008-12-14
1030
Filing of Confidential and Public
PRACTICE DIRECTION REGARDING THE FILING OF

CONFIDENTIAL AND PUBLIC DOCUMENTS WITH THE
TRIBUNAL*
March 2018
The purpose of this Practice Direction is to provide guidance on the filing of public
and confidential documents (e.g., pleadings, affidavits of documents, submissions,
witness statements, affidavits, expert reports, etc.) with the Competition Tribunal.
Its particular focus is on how the highlighting and redaction of confidential infor-
mation is to be done. It expands on the August 2008 Practice Direction on the filing
of confidential documents.
Proceedings before the Tribunal typically contain three categories of documents.
They are:
1. “Public” documents containing information that is public and that can be
disclosed to any person;
2. “Confidential Level A” documents containing information that a party
claims is confidential and that may only be disclosed to (a) external counsel
for the parties and their staff and (b) experts retained by a party who have
executed a confidentiality undertaking; and,
3. “Confidential Level B” documents containing information that a party
claims is confidential and that may be disclosed to (a) the individuals having
access to Confidential Level A documents and (b) a limited number of desig-
nated representatives of a party who have executed a confidentiality
undertaking.
The definitions of what constitutes confidential information, what confidential in-
formation is considered “Level A” or “Level B” and who qualifies as a designated
Directions
representative, as well as the requirements of any confidentiality undertaking, will

Practice
vary from case to case and will typically be contained in a confidentiality order
issued by the Tribunal.
All parties appearing before the Tribunal are required to adhere to the following
instructions when filing any documents that contain confidential information, intro-
ducing them into evidence or otherwise placing them on the record. This Practice
Direction applies to both electronic and paper documents filed with the Tribunal.
* Practice Direction Regarding the Filing of Confidential and Public Documents with the
Tribunal, (March 2018), https://www.ct-tc.gc.ca/en/procedure/practice/filing-documents.
html. Reproduced with the permission of the Competition Tribunal Secretariat of the
Competition Tribunal, 2020. This document is subject to change without notice. For the most
current version of the document refer to the Competition Tribunal website: https://www.ct-
tc.gc.ca/en/home.html.
1031
Confidential Level A Version

The Confidential Level A version of a document shall highlight the Confidential
Level A information in red and the Confidential Level B information in yellow.
Each page of the Confidential Level A version of a document shall indicate in the
top right-hand side: “CONFIDENTIAL LEVEL A”.
Confidential Level B Version

The Confidential Level B version of a document shall highlight the Confidential
Level B information in yellow and shall redact/black out the Confidential Level A
information. The redacted/blacked out portions shall be permanent and show the
extent to the actual text that is being redacted. Each page of the Confidential Level
B version of a document shall indicate in the top right-hand side: “CONFIDEN-
TIAL LEVEL B”.
In the event that the parties file only a single confidential version of a document, it
will be assumed to be the Confidential Level A version of the document.
Public Version
The Public version of a document shall redact/black out all Confidential Level A
and Confidential Level B information. The redacted/blacked out portions shall be
permanent and show the extent to the actual text that is being redacted. Each page
of the Public version of a document shall indicate in the top right-hand side:
“PUBLIC”.
There shall always be a public version of any document.
Filing of All Versions at the Same Time

The Confidential Level A, Confidential Level B and Public versions of documents
are to be filed with the Tribunal at the same time.
In those rare circumstances where time constraints would preclude the parties from
filing a public version of a document at the same time as the confidential ver-
sion(s), the Tribunal directs counsel to obtain approval from the presiding judicial
member or the case management judge prior to filing any confidential version of
the document with the Tribunal or as soon as possible after filing. If no presiding
judicial member or case management judge has yet been assigned, approval shall
be obtained from the Chairperson of the Tribunal. In such cases, the public version
of the confidential document shall nonetheless be filed with the Tribunal within
five (5) business days.
(613) 954-0857.
Chairperson
1032
Filing of Confidential Documents
FILING OF CONFIDENTIAL DOCUMENTS*
August 2008
Part A: — Non Urgent Proceedings

Documents marked as confidential will not be accepted for filing unless a Tribunal
Confidentiality Order is in place.
A party or intervenor wishing to file a document containing confidential informa-
tion should: (i) file the public version of the document marked “Public” with a
motion for a confidentiality order; and (ii) provide the Tribunal Registry with a
version of the document marked “confidential” that includes and identifies (in bold
capital letters) the confidential information that has been deleted from the public
version.
A party or intervenor wishing to file a document containing confidential informa-
tion should: (i) file the public version of the document marked “Public” with a
motion for a confidentiality order; and (ii) provide the Tribunal Registry with a
version of the document marked “confidential” that includes and identifies (in bold
capital letters) the confidential information that has been deleted from the public
version.
The draft confidentiality order should include:
(i) a description of the confidential document, the confidential information or
the category of document or information for which the person seeks the confi-
dentiality order;
(ii) the identification of the person or category of persons who are entitled to
have access to the confidential information or document;
(iii) any document or information or category of document or information to
be made available to the persons referred to in subparagraph (ii);
Directions
Practice
(iv) any written confidentiality agreement to be signed by the person referred

to in subparagraph (ii) and the provisions of that agreement;
(v) the number of copies of any confidential document to be provided to the
persons referred to in subparagraph (ii) [if applicable] and any limitation on
subsequent reproduction of that document by that person; and
(vi) the disposal of the confidential document following the final disposition
of the proceeding.
* Filing of Confidential Documents, (August 2008), https://www.ct-tc.gc.ca/en/procedure/

practice/filing-confidential-documents.html. Reproduced with the permission of the
1033
An example of a draft confidentiality order is attached as Appendix A. Parties will

need to adapt the order to the particular facts of their proceeding. If necessary, the
parties may agree to two levels of confidentiality.
A party or intervenor who wishes to file a document containing information that
has already been made subject to a confidentiality order shall file a public version
that does not include the confidential information and a confidential version with
each page clearly marked “confidential”.
Part B: — Urgent Matters

There may be cases in which due to time constraints, it will be impractical to bring
a motion for a confidentiality order and prepare a public version of confidential
material. In such cases, with the prior approval of the presiding judicial member,
confidential materials may be filed in confidence without an order or public version
on the undertaking that, at the direction of the presiding judicial member once the
urgent phase has passed, a confidentiality order and public versions of all confiden-
tial material will be added to the file.
Appendix “A”: — Draft Confidentiality Order
[1] FURTHER TO the application filed by the Commissioner of Competition (the

“Commissioner”) for an order pursuant to section .......... of the Competition Act,
R.S.C. 1985, c. C-34 (the “Act”), (description of remedy sought);
[2] AND FURTHER TO the ..........(name of party)..........’s request for a confidenti-
ality order;
[3] AND FURTHER TO the draft order confidentiality order filed on consent by
the Parties on ..........(date)..........;
THE TRIBUNAL ORDERS THAT:
[4] For purposes of this order
a. “Document” means any document whether in physical or electronic form,
including the things defined as “records” in subsection 2(1) of the Act;
b. “Protected Document” means any documents produced in the Proceeding,
including documents listed in affidavit of documents, expert reports, plead-
ings, affidavits, submissions, or lay witness statements and information con-
tained in those documents, that a Party claims is confidential or that the Tribu-
nal has determined is confidential;
c. “Parties” means the Commissioner and the Respondent, and “Party” means
the Commissioner or the Respondent;
d. “Proceeding” means the section .......... application brought by the Commis-
sioner and any motions or applications related thereto.
[5] Disclosure of Documents containing any of the following types of information
could cause specific and direct harm:
a. Information relating to prices (to the extent that such prices have not been
published or made generally known to competitors and customers), capacity,
1034
specific output or revenue data or market shares, or negotiations with custom-

ers about prices, rates and incentives;
b. Lists of existing, prospective, and former customers and/or suppliers;
c. Confidential contractual arrangements between the Parties and their custom-
ers and/or suppliers;
d. Financial data and reports;
e. Business plans, marketing and strategic plans, budgets, forecasts, and other
similar information;
f. Internal market studies and analyses;
g. Confidential financial information relating to the Parties, their customers, or
other third parties; and;
h. Other documents containing competitively sensitive and/or proprietary in-
formation of the Parties or third parties.
[6] If information from a Protected Document is incorporated into any other docu-
ment, that document shall be a Protected Document.
[7] Protected Documents will be identified in the following manner for the purpose
of this Proceeding:
a. At the time of production of a document, or as soon thereafter as possible, a
Party that claims confidentiality over a document shall provide counsel for the
other Parties with written notice identifying that document as a Protected
Document;
b. All documents designated as Protected Documents shall, on a preliminary
basis, be treated as a Protected Document, pending further determination;
c. Following the exchange of documents, the Parties shall use their best efforts
to agree as to whether the documents (or portions thereof) are to be treated as
Protected Documents;
d. If agreement cannot be reached, the Parties may apply to the Tribunal to
Directions
Practice
determine whether the document or a portion thereof, is a Protected

Document.
[8] Subject to a further order of the Tribunal, the consent of the Parties or as re-
quired by law, Protected Documents may only be disclosed to the following people,
except as required by law: (i) counsel for the Parties and their staff; (ii) independent
experts retained by the Parties who have executed Confidentiality Undertakings in
the form attached as Schedule A; (iii) the Commissioner and the Commissioner’s
staff.
[9] Prior to gaining access to Protected Documents referred to in this order, inde-
pendent experts shall execute a Confidentiality Undertaking in the form attached as
Schedule A. Confidentiality Undertakings shall be filed promptly with the Registrar
of the Tribunal, who shall retain them in confidence until completion or final dispo-
sition of this Proceeding and any related appeals.
[10] If a Party is required by law to disclose a Protected Document, or if a Party
receives written notice from a person who has signed a Confidentiality Undertaking
1035
pursuant to this order that they are required by law to disclose a Protected Docu-
ment, that Party shall give prompt written notice to the Party that claimed confiden-
tiality over the Protected Document so that the Party that claimed confidentiality
may seek a protective order or other appropriate remedy.
[11] Counsel for a Party and his or her staff, and the Commissioner and her staff
may make copies as they require in connection with the Proceeding.
[12] Nothing in this order prevents a Party from having full access to Protected
Documents that originated from that Party.
[13] Parties shall provide the Tribunal with redacted versions of all Protected Doc-
uments at the time of filing the Protected Document.
[14] At the hearing of the Proceeding:
a. Protected documents tendered as evidence at the hearing of the Proceeding
shall be identified as such and clearly marked as such;
b. The Tribunal may determine whether the document should be treated as
Protected Document;
c. Protected Documents shall not form part of the public record unless the
Party or Parties claiming confidentiality waive the claim, or the Tribunal de-
termines that the document is not a Protected Document.
[15] The termination of the Proceeding shall not relieve any person to whom Pro-
tected Documents were disclosed pursuant to this order from the obligation of
maintaining the confidentiality of such Protected Documents in accordance with
the provisions of this order and any confidentiality agreement.
[16] Upon completion or final disposition of the Proceeding and any appeals, all
Protected Documents and any copies of Protected Documents, with the exception
of Protected Documents in the possession of the Commissioner and her staff, shall
be destroyed or returned to the Party that produced them unless the Party that pro-
duced the Protected Documents states, in writing, that they may be disposed of in
some other manner, provided that counsel may keep one set of Protected Docu-
ments in their files.
[17] This order supersedes and replaces any existing confidentiality agreements be-
tween the Parties with respect to material produced in the Proceeding.
[18] This order shall be subject to further direction of the Tribunal and may be
varied by order of the Tribunal.
Sandra Simpson
Chairperson
Schedule “A”: — Confidentiality Undertaking
IN CONSIDERATION of being provided with information or documentation in

connection with the proceeding in the Competition Tribunal, File Number CT-
.......... (the “Proceeding”), between the Commissioner of Competition and ..........
over which claims for confidentiality have been advanced (“Protected Docu-
1036
ments”), I, .........., in the Province of .........., hereby undertake and agree to main-
tain the confidentiality of any Protected Document that I obtain, and in particular:
i. I will not copy or disclose a Protected Document to any other person, except
to a person permitted to receive it under the Confidentiality Order of the Com-
petition Tribunal dated .........., or such further order as the Tribunal may make.
ii. I will not use the information or documentation so obtained for any purpose
other than in connection with the Proceeding (including any application or
proceedings to enforce any Order made by the Tribunal in connection with the
Proceeding, and any application under section. 106 of the Competition Act, to
vary or rescind any order made by the Tribunal in connection with the Pro-
ceeding), and any related appeals only.
iii. Upon completion of this application and any related appeals, I agree that
all Protected Documents in my possession, shall be dealt with in accordance
with instructions from counsel for the party I am retained by or as prescribed
by order of the Tribunal. I may retain in my confidential files, subject to the
requirements of confidentiality imposed by this undertaking, materials pre-
pared by me, such as my expert report, as well as study results and materials
of a general nature which do not replicate any confidential information from a
Protected Document.
iv. I have read the Confidentiality Order, a copy of which is attached to this
agreement, and agree to be bound by it. I acknowledge that any breach of this
undertaking by me will be considered to be a breach of the said order of the
v. I acknowledge and agree that the owner of a Protected Document may not
have an adequate remedy at law and would be irreparably harmed in the event
that any of the provisions of this undertaking are not performed in accordance
with its specific terms or otherwise breached. Accordingly, I agree that the
owner of a Protected Document shall be entitled to injunctive relief to prevent
breaches of this agreement and to specifically enforce the terms and provisions
Directions
Practice
hereof, in addition to any other remedy to which they may be entitled at law or
in equity.
vi. In the event that I am required by law to disclose any Protected Document
that is subject to this undertaking, I will provide [insert name of retaining or
employing party] with prompt written notice so that the person that claimed
confidentiality over such information or documentation may seek a protective
order or other appropriate remedy. In any event, I will furnish only that por-
tion of the Protected Document that is legally required and I will exercise my
best efforts to obtain reliable assurance that confidential treatment will be ac-
corded to it.
vii. I will promptly, upon the request of the person providing a Protected Doc-
ument, advise where it is kept by me.
viii. I hereby attorn to the jurisdiction of the Competition Tribunal to resolve
any disputes arising under this agreement.
1037
SIGNED, SEALED AND DELIVERED before a witness this .......... day of ..........,
...................................
(Witness Signature) (Signature)
...................................
(Print Name) (Print Name)
PRACTICE DIRECTION REGARDING THE NEW

PROVISIONS OF THE COMPETITION ACT*
September 2009
The purpose of this Practice Direction is to provide guidance on the procedure to be
followed before the Tribunal with respect to the new provisions of the Competition
Act, R.S.C. 1985, c. C-34 that came into force under Bill C-10, An Act to implement
certain provisions of the budget tabled in Parliament on January 27, 2009 and
related fiscal measures, S.C. 2009, c. 2, which received Royal Assent on March 12,
2009.
This Practice Direction is intended to clarify and supplement the Competition Tri-
bunal Rules, SOR/2008-141, until formal amendments to the Rules can be made.
This Practice Direction should be read in conjunction with the existing Rules.
The Practice and Procedure of the Competition Tribunal with respect to the new
provisions of the Competition Act require the Competition Tribunal Rules to be
supplemented as follows:
1. How to move for an interim injunction to freeze assets in a case involving
false or misleading representations to the public (s. 74.111)
Rules 96 to 99 shall apply to applications for interim injunctions under section
74.111 of the Competition Act.
2. How private parties may seek leave under the new price maintenance provi-
sion (s. 76 and 103.1)
* Practice Direction Regarding the New Provisions of the Competition Act, (September
2009), https://www.ct-tc.gc.ca/en/procedure/practice/new-provisions-competition-act.html.
Reproduced with the permission of the Competition Tribunal Secretariat of the Competition
Tribunal, 2020. This document is subject to change without notice. For the most current
version of the document refer to the Competition Tribunal website: https://www.ct-tc.gc.ca/
en/home.html.
1038
Case Management and Hearing Management Conferences (i)
Rules 114 to 124 shall apply to applications filed pursuant to section 103.1 of
the Competition Act in which the applicant seeks leave to make an application
under section 76 of the Act.
3. Applications by the Commissioner to deal with parties who have closed or
wish to close transactions during the Commissioner’s review period in merger
cases (s. 123.1)
When such cases are urgent, the rules relating to interim or temporary orders
may be used (see Rules 96 to 98). In situations which are not urgent, the mat-
ter should be treated as a contested proceeding under Rules 35 to 80. If the
Commissioner’s counsel wishes a direction about how to proceed in a particu-
lar case, the Tribunal Chair may be contacted.
Sandra Simpson
Chairperson
CASE MANAGEMENT AND HEARING MANAGEMENT

CONFERENCES*
October 2010
(i) — The Case Management Conference

The Tribunal takes an active role in case management. This means that, shortly
after a reply is filed or sooner if indicated by the circumstances, counsel will be
asked to attend (perhaps by teleconference) a case management conference with a
judicial member of the Tribunal to establish the hearing’s language requirements,
start date, duration, location and modus operandi (electronic or paper — the parties
Directions
Practice
are to indicate in their pleadings the preferred medium for the hearing of the appli-
cation). As well, timeframes, dates and deadlines will be set for pre-hearing proce-
dures. They may include:
Constitutional Issues
• a date for serving a notice of constitutional question
• a date for hearing the motion before a hearing on the merits
* Practice Direction Regarding Case Management and Hearing Management Conferences,

(October 2010), https://www.ct-tc.gc.ca/en/procedure/practice/case-management-hearing-
management-conferences.html. Reproduced with the permission of the Competition Tribunal
Secretariat of the Competition Tribunal, 2020. This document is subject to change without
notice. For the most current version of the document refer to the Competition Tribunal
website: https://www.ct-tc.gc.ca/en/home.html.
1039
(i) Competition Tribunal Practice Directions
Document Disclosure
• dates for service of affidavits of documents by parties and for the delivery of
documents
• dates for service of intervenors’ affidavits of documents and for the delivery
of their documents
• a deadline for filing motions which raise issues about affidavits of documents
• a date for hearing any such motions
Discovery
• a deadline for filing motions about the scope of discoveries and a hearing date
for any such motions
• a time period during which discoveries are to be held
• a date for fulfilling any undertakings
• a deadline for completing any further examinations
• a deadline for filing any motions related to discoveries
• a date for hearing discovery motions
Witness Statements
• a date for service of applicants’ witness statements
• a date for service of respondents’ witness statements
• a date for service of interveners’ witness statements
• a date for service of applicants’ reply witness statements
• a date for providing witness statements to the Tribunal
Experts Reports
• a date for service of applicants’ reports
• a date for service of respondents’ reports
• a date for service of any applicants’ reply reports
• a date for providing expert reports to the Tribunal
• a date for filing the acknowledgements (see final paragraph below)
Documents for the Hearing

• a deadline for providing documents to the Tribunal for use at the hearing (e.g.
briefs of authorities, agreed books of documents)
1040
Case Management and Hearing Management Conferences (ii)
Motions
• a deadline for filing any pre-hearing motions not described above
• a date for hearing such motions
Pre-hearing Schedule
Counsel will be asked to consult one another before the case management confer-
ence with a view to preparing an agreed pre-hearing schedule. If they cannot agree,
each party shall file a proposed timetable and the Tribunal may circulate a proposal
before the case management conference to provide a basis for discussion.
Chess Clock Time Allocation

In the course of further case management conferences, the Tribunal will set with
the parties the allocation of the total hearing time between the parties. Please refer
to the Notice to the parties and the legal profession concerning the chess clock
procedure.
Scheduling Order
After the case management conference, a Scheduling Order will be issued. Counsel
should understand that, once dates have been settled and made the subject of a
Scheduling Order, they are firm. Accordingly, adjournments, even if sought on
consent, are unlikely to be granted.
For this reason, it is important for counsel to consult clients, experts and other wit-
nesses about their availability before the case management conference.
(ii) — The Hearing Management Conference

This conference (which may also be held by teleconference) will be chaired by the
judicial member who has been designated to preside at the hearing. It may deal
with matters such as:
Directions
Practice
• a date for filing a statement of agreed facts

• joint authorities
• a joint compendium of key documents
• whether there are any preliminary matters or motions to be dealt with at the
hearing such as motions to amend pleadings or to exclude experts’ reports
• the possibility of witnesses testifying in panels
• sitting times during the hearing
• a date for the filing of a hearing schedule jointly prepared by all parties which
provides (i) the anticipated duration of opening statements (ii) the name of
each witness and when each is scheduled to be called (iii) an estimate of the
duration of the direct cross and re-examination of each witness and the antici-
pated duration of closing argument.
1041
(ii) Competition Tribunal Practice Directions
• the timing of the delivery of any written argument

Sandra Simpson
Chair
COMPETITION TRIBUNAL NOTICE TO PARTIES AND THE

LEGAL PROFESSION*
November 2010
Simultaneous Interpretation before the Tribunal

The Competition Tribunal must ensure that, at the request of a party to a proceed-
ing, facilities are made available for the simultaneous interpretation of the proceed-
ings, including the evidence given and taken, from one official language into the
other
The Competition Tribunal Rules, SOR/2008-141, therefore require parties to advise
the Tribunal of the official language they intend to use in the proceedings. Persons
seeking intervenor-status must also advise the Tribunal of the official language they
will use at the hearing of the motion for leave to intervene and, if leave is granted,
in the proceedings.
In a case where one official language has been identified in the pleadings as the
language of the proceedings and a party subsequently determines that one or more
of its witnesses will testify in the other official language, the party should advise
the Tribunal Registry, in writing, as soon as possible.
Simultaneous interpretation services for the two official languages are provided at
no cost to the parties. However, the Tribunal is charged cancellation fees if inter-
pretation services are cancelled within less than seven working days of the sched-
uled hearing. Accordingly, the Registry should be advised immediately if a case
settles or if a witness will not appear as scheduled.
Parties appearing before the Tribunal should be aware that other Courts, including
the Federal Court of Appeal, may have different procedures in place with respect to
the simultaneous interpretation of proceedings. A party should therefore contact the
Registry of the Federal Court of Appeal and consult the Federal Courts Rules,
SOR/98-106, in case of an appeal of a Tribunal decision where the proceedings
* Notice on the Simultaneous Interpretation before the Tribunal, (November 2010),

https://www.ct-tc.gc.ca/en/procedure/notices/simultaneous-interpretation.html. Reproduced
with the permission of the Competition Tribunal Secretariat of the Competition Tribunal,
2020. This document is subject to change without notice. For the most current version of the
document refer to the Competition Tribunal website: https://www.ct-tc.gc.ca/en/home.html.
1042
Acknowledgement of Expert Witnesses
leading to its issuance were conducted in whole or in part in both official

languages.
Sandra Simpson
Chair
ACKNOWLEDGEMENT OF EXPERT WITNESSES*
December 2010
Expert witnesses who provide a report for use as evidence are required to sign the
Tribunals Acknowledgement of Expert Witness form which is attached to this No-
tice. In signing they acknowledge that they will comply with the Tribunal s code of
conduct for expert witnesses. It is described in the form. A signed copy of the form
is to be included in all expert reports filed with the Tribunal.
Sandra Simpson
Chair
Appendix Acknowledgement of Expert Witness
I, (name of expert), acknowledge that I will comply with the Competition Tribunal
s code of conduct for expert witnesses which is described below:
1. An expert witness who provides a report for use as evidence has a duty to
assist the Tribunal impartially on matters relevant to his or her area of
expertise.
2. This duty overrides any duty to a party to the proceeding, including the
Directions
person retaining the expert witness. An expert is to be independent and objec-

Practice
tive. An expert is not an advocate for a party.

................................... ...................................
(Date) (Signature of expert witness)
* Notice on Acknowledgement of Expert Witnesses, (December 2010), https://www.ct-tc.gc.

ca/en/procedure/notices/acknowledgement-expert-witnesses.html. Reproduced with the
1043
COMPETITION TRIBUNAL HEARING TIME

MANAGEMENT*
December 2010
The Experience in the B-Filer case

The B-Filer case (B-Filer Inc. v. The Bank of Nova Scotia, CT-2005-006) was the
first in which the Tribunal used the chess clock method of managing the hearing
time
Counsel for both parties asked that the case be assigned a 19 day hearing. Based on
a five hour sitting day, the time they asked for totaled ninety-five hours. Counsel
divided the time equally taking forty-five hours each and left five hours to be used
by the Tribunal for questions and housekeeping matters.
Counsel understood that, unless they were responding to matters raised by the Tri-
bunal, whenever they were on their feet, whether opening, examining in chief,
making an objection or responding to one, cross-examining, or making final argu-
ment, their time was running down. They also understood that when their forty-five
hours expired, their oral participation in the hearing would conclude.
In these circumstances, each counsel was responsible for deciding how to use the
available time to greatest effect and for allocating time between the various seg-
ments of the case. To use an extreme example for illustrative purposes, if counsel
had chosen to use forty hours for an opening statement, there would only have been
five hours left to present evidence, cross-examine and make final argument.
The Tribunal reporters agreed that the transcript would show the time used by each
counsel. Each morning, the reporters provided everyone at the hearing with a daily
time report. It showed counsel how much of their time had been used and allowed
them to allocate their remaining time. If there was a dispute about the time report, it
had to be raised immediately. In B-Filer, there were no such disputes.
Future Cases
As a result of the successful implementation of this procedure, counsel can antici-
pate its use in future hearings with modifications suggested by our ongoing exper-
iences. For example, we no longer allocate time to the Tribunal. The time it uses
simply does not count. As well, we have decided that it is more realistic to base our
calculations on a 4.5 rather than a 5 hour day.
* Chess Clock Proceedings, (December 2010), https://www.ct-tc.gc.ca/en/procedure/notices/

chess-clock-proceedings.html.Reproduced with the permission of the Competition Tribunal
1044
Practice Direction Regarding Electronic Hearings
We have also developed a practice for dealing with the time spent by counsel argu-
ing objections and motions. The total time spent will generally be deducted from
the time remaining available to the losing party on the objection or motion. For
example, if applicant s counsel spends 12 minutes arguing an objection and counsel
opposite uses 5 minutes, a total of 17 minutes will be debited from the unsuccessful
party s hearing time. The purpose of this rule is to discourage frivolous objections
and arguments. However, the presiding judicial member retains the discretion to
vary the application of this rule in appropriate circumstances. Further, although the
total hearing time must be set at an early stage, the parties need not divide the time
until after witness statements and reports have been exchanged.
Conclusion
Justice Dawson observed in B-Filer at paragraph 280 that:
A significant benefit that flows from this type of time management is that hearings
will conclude in the time allotted. This better allows the parties to know in advance
the cost of the hearing, and avoids the delay and additional expense caused by the
extension of hearings beyond their original end dates.
Her statement continues to represent the Tribunal’s view that chess clock hearing
management is a best practice.
Sandra Simpson
Chair
PRACTICE DIRECTION REGARDING ELECTRONIC

HEARINGS* Directions
Practice
Effective January 1, 2012, Tribunal hearings will only be electronic (i.e. no more
paper hearings)
March 2011
bunal Rules, SOR/2008-141, with respect to electronic hearings. The Rules define
an electronic hearing as a hearing in which documents are provided in an electronic
form to the Tribunal Registry and are presented electronically in the course of the
* Practice Direction Regarding Electronic Hearings, (March 2011), https://www.ct-tc.gc.ca/

en/procedure/practice/electronic-hearings.html. Reproduced with the permission of the
1045
hearing. Rule 33 provides that the Tribunal may give directions requiring the use of
any technology it considers appropriate to facilitate the conduct of a hearing.
Given the complexity of Tribunal cases and the numerous exhibits normally filed
during a Tribunal hearing, the Tribunal, after having conducted a number of elec-
tronic and paper hearings, has found that electronic hearings are the preferred way
to proceed before the Tribunal. Accordingly, as of January 1, 2012, hearings before
the Tribunal including motions (except for leave) will be paperless. Electronic
hearings will be the only method by which a party, including an intervenor or a
self-represented party, may proceed before the Tribunal. The Tribunal Registry will
contact the parties before the hearing to provide particulars about the conduct of an
electronic hearing. Rule 12 of the Competition Tribunal Rules already requires par-
ties to file their documents by electronic transmission.
This Practice Direction will not apply to motions for leave to commence a private
application or motions for leave to intervene in a proceeding. Such motions may be
on paper. However, as noted above, if leave is granted, the matters will proceed
electronically.
For more information about this Practice Direction, please contact the Deputy Reg-
istrar at (613) 954-0857.
Sandra Simpson
Chairperson
PRACTICE DIRECTION REGARDING THE

ADMINISTRATIVE TRIBUNALS SUPPORT SERVICE OF
CANADA*
The purpose of this Practice Direction is to provide guidance on the procedure to be

followed before the Tribunal following the coming into force on November 1,
2014, of the Administrative Tribunals Support Service of Canada Act, as enacted
by section 376 of the Economic Action Plan 2014 Act, No. 1, S.C. 2014, c. 20.
Section 447 of the Economic Action Plan 2014 Act, No. 1 repeals section 14 of the
Competition Tribunal Act, R.S.C. 1985, c. 19, which provides for the creation of
the Registry of the Competition Tribunal.
* Practice Direction Regarding the Administrative Tribunals Support Service of Canada,

(November 2014), https://www.ct-tc.gc.ca/en/procedure/practice/practice-direction-
regarding-atssc.html. Reproduced with the permission of the Competition Tribunal
1046
Practice Direction Regarding Mediation
The Administrative Tribunals Support Service of Canada will replace the Registry
of the Competition Tribunal by becoming the sole provider of support services to
the Competition Tribunal as well as ten other federal administrative tribunals.
bunal Rules, SOR/2008-141, until formal amendments to the Rules can be made.
This Practice Direction should be read in conjunction with the existing Rules.
Where an existing Rule requires that a party provide or file a document with the
Registry of the Competition Tribunal, that Rule should be read as requiring the
party to provide or file the document with the Tribunal. Where an existing Rule
refers to the Registrar of the Tribunal, that Rule should be read as referring to the
Parties and counsel can continue to use the Tribunal s secure E-Filing website and
the Tribunal s filing depot e-mail address (filing.depot@ct-tc.gc.ca) to provide and
file documents with the Tribunal.
Parties and counsel can continue to contact Mr. Jos LaRose, Deputy Registrar, if
they have any questions regarding Tribunal proceedings (613-954-0857 or
jos.larose@tribunal.gc.ca).
November 7, 2014
Chairperson
PRACTICE DIRECTION REGARDING MEDIATION*
June 2016
The purpose of this Practice Direction is to provide guidance on the procedures and
Directions
other considerations relating to mediation in matters before the Competition

Practice
Tribunal.
Mediation is a collaborative process in which parties agree to request the assistance
of a neutral person in voluntarily reaching a mutually acceptable settlement of is-
sues in dispute. The Tribunal recognizes the importance to all parties of early reso-
lution of issues and the need, as directed by subsection 9(2) of the Competition
Tribunal Act, to deal with matters as informally and expeditiously as the circum-
stances and considerations of fairness permit. Consistent with this mandate, the Tri-
bunal provides all parties with the option of participating in a mediation with a
* Practice Direction Regarding Mediation, (June 2016), https://www.ct-tc.gc.ca/en/

procedure/practice/mediation.html. Reproduced with the permission of the Competition
Tribunal Secretariat of the Competition Tribunal, 2020. This document is subject to change
without notice. For the most current version of the document refer to the Competition
Tribunal website: https://www.ct-tc.gc.ca/en/home.html.
1047
judicial member of the Tribunal for the purpose of resolving a proceeding or any
outstanding issues. As described more fully below, such mediations will only occur
with the consent of all parties to a proceeding before the Tribunal and in accor-
dance with the procedures agreed upon by the parties.
(a) — Requesting a Mediation

Mediation is available in all contested proceedings before the Tribunal, including
proceedings commenced by a person that has been granted leave under section
103.1 of the Competition Act. Parties are encouraged to consult with each other,
when developing the timetable for the disposition of an application (see Rule 40) or
at another early stage of the proceeding, to assess whether mediation would be ap-
propriate in a given case. In the event that the parties wish to engage in a mediation
before a judicial member of the Tribunal, parties should advise the Tribunal during
the initial case management conference (see Rule 135) or otherwise communicate
their intention to request a mediation to the Registrar of the Tribunal at the earliest
opportunity. Where possible, the parties should advise the Tribunal of their agree-
ment to request a mediation prior to the issuance of any timetable for the disposi-
tion of the application such that the date for mediation can be reserved by counsel.
The request for a mediation should also identify the judicial member whom the
parties would want to select as the mediator. Subject to availability, the mediation
may be scheduled at any point during the proceeding (e.g., prior to or after comple-
tion of examinations for discovery).
Parties should expect that, in all proceedings, the Tribunal will also be proactive in
exploring the prospects for mediation during the early and later stages of the case
management process.
(b) — Selecting a Mediator

Parties are permitted to identify their preferences with respect to an individual judi-
cial member of the Tribunal to act as mediator but are not required to state a prefer-
ence. The Tribunal will endeavour to accommodate such requests, subject to availa-
bility and other considerations. As discussed below, to the extent that a judicial
member participates in any mediation, that member would not be entitled to partici-
pate in any subsequent part of the proceeding, including the ultimate hearing on the
merits, without the express written consent of all parties. In the event that the par-
ties’ preferred mediator is not available, or if the parties are not able to agree upon
a preferred mediator, the Tribunal will propose an alternate judicial member or
other member of the Federal Court to conduct the mediation. In the event that a
party or both parties decide not to proceed with the Tribunal’s proposed mediator,
they shall inform the Deputy Registrar of their decision and the Deputy Registrar
shall advise the Tribunal of that decision without communicating to the judicial
members or other members of the Federal Court the identity of the party that de-
clined to proceed or any reasons why one party may have elected to not proceed
with the mediation.
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Practice Direction Regarding Mediation (e)
(c) — Scope of the Mediation

Parties will define the scope of the issues to be addressed in the mediation with the
concurrence of the mediator. Parties can agree to a mediation that involves all of
the matters at issue in the proceeding, or can confine the mediation to part of the
proceeding or to a specific issue that may be determinative of the proceeding.
(d) — Procedure to be Followed

The parties are encouraged to agree upon the timing and other steps to be followed
in the mediation. Subject to variation by agreement among the parties and with the
concurrence of the mediator, the mediation will proceed in accordance with the
following procedure:
(i) there will be no obligation to pursue the mediation process to a successful
resolution;
(ii) parties will determine the length and form of mediation briefs, and ex-
change mediation briefs summarizing the matters at issue, relevant facts, evi-
dence (including relevant documents or other materials) and proposed resolu-
tion, and will file such briefs with the mediator in advance of the mediation
and in accordance with the schedule determined by the mediator;
(iii) the mediator and parties will participate in a pre-mediation conference to
discuss preliminary matters, including potential modifications to the procedure
and the schedule for the mediation;
(iv) the mediator will control all procedural aspects of the mediation, includ-
ing meeting and communicating separately with each party and/or holding
joint meetings with the parties;
(v) in addition to counsel, each party should be represented by a senior execu-
tive or other person authorized to negotiate a resolution of the proceeding;
(vi) the mediator will not transmit information received in confidence from
any party to any other party or any third party unless authorized to do so by
Directions
Practice
the party transmitting the information; and

(vii) any resolution reached will be reduced to writing and binding.
Either party may withdraw from and terminate the mediation at any time prior to
the achievement of a resolution. Other aspects of the procedure to be followed may
be agreed upon by the parties, subject to concurrence by the mediator.
(e) — Role of Intervenors

Subsection 9(3) of the Competition Tribunal Act permits a person to intervene, with
leave of the Tribunal, in any proceedings before the Tribunal. The Tribunal antici-
pates that the mediation process will be between the applicant and respondent(s),
and will not involve intervenors or proposed intervenors. However, where all par-
ties agree, intervenors may participate in the mediation in accordance with the pro-
cedure agreed upon by the parties and with the concurrence of the mediator.
1049
(f) Competition Tribunal Practice Directions
(f) — Where an Agreement is Reached Through Mediation

When acting as a mediator, the judicial member of the Tribunal has no power to
impose a resolution of the proceeding. If an agreement to resolve the proceeding is
reached during the mediation, the agreement will generally be formalized in a con-
sent agreement to be registered in accordance with section 105 of the Competition
Act.
In the event that the mediation does not result in an agreement, the Tribunal will
assume that the parties will continue with the proceeding, subject to being advised
otherwise.
(g) — Confidentiality of Mediation

The Tribunal recognizes that it is critical for the success of mediation proceedings
that they be strictly confidential. In this regard, the mediator, the parties and their
representatives shall keep confidential all information disclosed during the course
of the mediation. There will be no recording or transcript made of any of the medi-
ation sessions. The judicial member that acted as mediator will not participate in
any other aspect of the proceeding, including the hearing, without the express writ-
ten consent of all parties. Further, the judicial member that acted as mediator will
not disclose any aspect of the mediation process to the members of the Tribunal
assigned to the matter.
For more information about this Practice Direction, please contact the Deputy Reg-
istrar at (613) 954-0857.
Denis Gascon
Chairperson
NEW PHYSICAL SECURITY MEASURES FOR VISITORS

TO THE COMPETITION TRIBUNAL*
April 3, 2017
A number of physical security enhancements will be implemented at 90 Sparks
Street, to ensure that the Competition Tribunal remains a secure environment for
members, parties, witnesses, members of the legal profession, employees and the
public in attendance. While the majority of these measures will be imperceptible,
* New Physical Security Measures for Visitors to the Tribunal, (April 2017), https://www.ct-
tc.gc.ca/en/procedure/notices/physical-security-measures.html. Reproduced with the
1050
New Physical Security Measures
security screening of visitors and their belongings will affect all those who access
the Competition Tribunal facilities.
All visitors to the Competition Tribunal, including lawyers, parties, witnesses, me-
dia and observers attending proceedings, will be subject to the security screening
process and will need to consent to screening to have access to the Competition
Tribunal.
The Courts Administration Service (CAS) is the lead department for these new se-
curity measures and it has assured us it will make every effort to ensure an efficient
screening process. Parties, witnesses and lawyers are encouraged to arrive at least
30 minutes before the scheduled start time of the proceeding. Information about the
screening process and list of prohibited items are available on the CAS web site.
Denis Gascon
Chairperson
Directions
Practice
1051
TRANSPORT CANADA
GUIDELINES FOR THE ASSESSMENT OF AIR
CARRIER JOINT VENTURES*
Introduction
In 2016, Transport Canada leveraged key findings from the Canada Transportation
Act Review to develop a vision for the future of transportation in Canada. The de-
partment held extensive consultations with partners and stakeholders, and identified
the following issues:
Canada’s transportation system is critical to the well-being of our economy, moving
our goods and people within Canada and to the world;
Federal leadership and a national transportation strategy is needed to support the
transportation system 20–30 years in the future; and
An efficient and integrated national transportation system is vital to economic
growth, trade, and social well-being.
The Honourable Marc Garneau, Minister of Transport, announced Transportation
2030: A Strategic Plan for the Future of Transportation in Canada, in Fall 2016,
and to move this vision forward, the Minister introduced Bill C-49, the Transporta-
tion Modernization Act, in May 2017. The Transportation Modernization Act
amends the Canada Transportation Act (CTA) and other related acts to allow the
Government to move forward with measures in support of Transportation 2030,
received Royal Assent in May 2018.
One of the key areas of focus of the Transportation Modernization Act is the need
to modernize Canada’s policy framework for joint ventures. Air carrier joint ven-
tures are a growing international trend, whereby carriers collaborate on several as-
pects of operations for routes between given geographic regions. Given that a joint
venture may lead to greater integration and implications for competition, national
authorities must have oversight and may authorize joint ventures to ensure stake-
holders involved benefit from the proposal. The Transportation Modernization Act
allows the Minister of Transport (Minister) to consider and authorize applications
Air Carrier
Ventures
Joint
* ©Transport Canada Guidelines for the Assessment of Air Carrier Joint Ventures,
(Available for order at: https://www.tc.gc.ca/en/services/aviation/commercial-air-services/
guidelines-assessment-air-carrier-joint-ventures.html). © Her Majesty the Queen in Right of
Canada, represented by the Minister of Transport, 2020. This information has been
reproduced with the permission of the Department of Transport. The Department of
Transport does not endorse or approve The Annotated Competition Act 2021 or its contents.
.
1053
Transport Canada
Guidelines for the Assessment of Air Carrier Joint Ventures
that may be submitted for the authorization of joint ventures between two or more
air carriers providing air services, with input from the Commissioner of Competi-
tion (Commissioner). Should the Minister authorize a proposed joint venture, the
arrangement would remain exempt from the application of sections 45 and 47 of
the Competition Act for as long as the authorization has not been revoked and the
parties are meeting all terms and conditions of the authorization. Note that only
those activities that are directly related to, and reasonably necessary for giving ef-
fect to, the objective of the joint venture arrangement will be exempt from the ap-
plication of sections 45 and 47.
In addition, the Competition Tribunal shall not make an order under section 90.1
and 92 of the Competition Act in respect of an arrangement authorized by the Min-
ister for as long as the authorization has not been revoked and the parties are meet-
ing all terms and conditions of the authorization.
These guidelines were developed under the authority of section 53.71 of the CTA
and outline the assessment and authorization process that will be undertaken by
Transport Canada and the Competition Bureau (Bureau) following a joint venture
application. The guidelines provide additional details to air carriers considering a
joint venture.
The Guidelines may be revised from time to time as appropriate.
Definition of Joint Ventures

The CTA refers to joint ventures as “arrangements involving two or more transpor-
tation undertakings” and in section 53.7 provides the following definitions:
“Arrangement” means an agreement or arrangement, other than a transaction re-
ferred to in subsection 53.1(1), involving two or more transportation undertakings
providing air services, as defined in subsection 55(1), to, from or within Canada, to
coordinate on any aspect of the operation or marketing of such services, including
prices, routes, schedules, capacity or ancillary services and to share costs or reve-
nues or other resources or benefits. (“entente”)
“Party” means any person who proposes to enter into or has entered into an ar-
rangement for which a notice has been given under subsection 53.71(1). (“partie”)
Role of Transport Canada and the Competition Bureau

Upon receipt of a notification pursuant to section 53.71(1) of the CTA, proposed
joint venture applications will be assessed by the Minister to determine whether the
arrangement raises significant public interest considerations. Should the Minister
determine that the arrangement raises significant public interest considerations, a
public interest review will begin. The public interest review will include input from
the Commissioner in the form of a report to the Minister on any concerns regarding
potential prevention or lessening of competition that may occur as a result of the
proposed arrangement. Below is a description of each organization, as well as their
role in the joint venture assessment process.
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Transport Canada
Transport Canada
Transport Canada is responsible for transportation policies and programs. It pro-
motes safe, secure, efficient and environmentally-responsible transportation.
The Department has a number of complex roles including:
• Rulemaking: proposing and putting in place laws, regulations, standards and
policies.
• Oversight: including issuing licenses, certificates, registrations and permits;
conducting audits, inspections and surveillance; and taking action when rules
are broken.
• Outreach: including promotion, educating the public, and increasing aware-
ness of transportation issues.
With respect to proposed joint ventures, Transport Canada will assess whether they
raise significant public interest considerations, including but not limited to, compe-
tition concerns. A summary1 of the Minister’s final decision concerning a joint ven-
ture application, excluding confidential information, will be made public. The Min-
ister may also elect to publish a summary of the preliminary decision if the
circumstances warrant, for example, to obtain the views of stakeholders on terms
and conditions relating to the public interest and competition under which an au-
thorization could be given.
The Competition Bureau

The Bureau is an independent law enforcement agency that ensures Canadian busi-
nesses and consumers prosper in a competitive and innovative marketplace.
Headed by the Commissioner, the Bureau is responsible for the administration and
enforcement of the Competition Act, the Consumer Packaging and Labelling Act
(except for enforcement as it relates to food), the Textile Labelling Act and the
Precious Metals Marking Act.
The basic operating assumption of the Bureau is that competition is good for both
businesses and consumers. Where the Minister triggers a public interest review pro-
cess, the Commissioner will submit a report to the Minister and the parties on any
concerns regarding potential prevention or lessening of competition as a result of
the joint venture. A summary of this report2 will be made public in addition to, or
in lieu of, a position statement under the Competition Act.
Air Carrier
Ventures
Joint
1 The CTA requires that the summaries published by the Bureau or the Minister contain no
confidential information. Confidential information is viewed as meaning proprietary, com-
mercially sensitive information obtained during the course of a review.
2 The CTA requires that the summaries published by the Bureau or the Minister contain no
confidential information. Confidential information is viewed as meaning proprietary, com-
mercially sensitive information obtained during the course of a review.
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Transport Canada
The Minister will consult with the Commissioner before issuing a preliminary deci-
sion or varying or rescinding an authorization. In addition, the Minister may con-
sult with the Commissioner at any stage of the process, including when considering
appropriate measures to address public interest and competition concerns.
Proposed Assessment Process and Timelines

Pre-Notice Meetings
In advance of an official notice and without prejudice to final determination by the
Minister, parties to a proposed joint venture are encouraged to meet with Transport
Canada officials to provide a summary of their proposed arrangement for discus-
sion and review. Parties are encouraged to openly discuss all aspects of their propo-
sal with Transport Canada officials, to ensure that their official application is com-
plete, tailored to the characteristics and the complexity of the arrangement, and
ready for consideration at the time of filing. Transport Canada officials will be
available to meet with parties as often as required to help them prepare a complete
application, within reason and while considering legal, time and resource con-
straints. These prenotice meetings are designed to help applicants ensure they un-
derstand the assessment process, and to ensure that applications are well prepared
for assessment prior to the payment of the application fee.
Notice
Formal consideration of a proposed joint venture by the Minister and Commis-
sioner will only begin upon receipt of a complete application notice that includes
all of the information required under the present guidelines, and receipt of payment
fee. The Minister and the Commissioner may agree to waive certain filing require-
ments depending on the facts, characteristics and complexity of each application.
This assessment will be made on a case-by-case basis.
Under s. 53.71(6) of the CTA, the Minister has 45 days after receiving a complete
notice of application to advise parties and the Commissioner whether a proposed
joint venture raises significant public interest considerations.
Review of Notice
Following receipt of a notice, Transport Canada will perform a preliminary assess-
ment of the information received for completeness. The Minister and the Commis-
sioner may independently require, at any time during the assessment process, par-
ties that have given notice to provide further information.
Transport Canada will also assess whether the joint venture involves a transporta-
tion undertaking providing air service. In some cases, the Minister may require ad-
ditional information from parties to the joint venture to make this determination. If
the joint venture does not involve a transportation undertaking, this process is not
applicable and the joint venture will remain subject to the Competition Act.
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Transport Canada
Consultation
The Minister and Commissioner will generally seek the views of stakeholders (in-
cluding, but not limited to, passengers, customers, suppliers, airport authorities, air
carrier sector and other levels of government). When doing so, the Minister will not
disclose confidential information and the Commissioner will act in accordance with
section 29 of the Competition Act. In some cases, however, the Minister may seek
consent from parties to communicate relevant confidential information to facilitate
the consultation.
Assessment & Determination

Within the first 45 days of receipt of a complete notification, a proposed joint ven-
ture will be assessed to determine whether it raises significant considerations with
respect to the public interest. Where the Minister finds, pursuant to section 53.71(6)
of the CTA, that a proposed joint venture raises significant public interest consider-
ations, the proposed joint venture will be subject to a review process set out in
section 53.73 of the CTA, including an examination of public interest issues by
delegated officials of Transport Canada, with input, in the form of a report, from
the Commissioner on any concerns regarding potential prevention or lessening of
competition as a result of the joint venture. If no public interest considerations are
found, section 53.73 will not apply, and the joint venture will remain subject to the
Competition Act.
Confidentiality
All information submitted to the Minister and the Commissioner will be treated as
confidential consistent with section 51 of the CTA and Section 29 of the Competi-
tion Act3.
Assessment Timelines
The following are the key milestones and expected timelines for the consideration
of air carrier joint ventures under the CTA4:
• Day 0: The statutory timelines start upon receipt by the Minister and the Com-
missioner of a complete application from all parties to a proposed joint ven-
ture. The Minister will determine whether an application is complete.
• Day 45: The Minister to inform the parties and the Commissioner as to
whether the proposed arrangement raises, in the Minister’s opinion, significant
public interest considerations.
Air Carrier
Ventures
Joint
3 The Commissioner’s approach to section 29 is set out in the Information Bulletin on the
Communication of Confidential Information under the Competition Act, available at
4 Refer to Appendix A for a visual of the expected timelines.
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Transport Canada
• Day 120: The Commissioner to report to the parties and the Minister on any
concerns regarding potential prevention or lessening of competition that may
occur as a result of the proposed arrangement. The Commissioner shall make
public a summary of the report.
• Day 150: The Minister to report to the parties on any concerns with respect to
the public interest that may occur as a result of the proposed arrangement and
provide a copy of the report to the Commissioner.
• Day 180: The parties to address, in writing, any concerns with respect to the
public interest and competition raised by the Minister and the Commissioner
and may propose measures to address those concerns.
• Day 225: After consulting with the Commissioner, the Minister to render a
preliminary decision regarding the proposed arrangement and specify any
terms and conditions relating to the public interest and competition under
which an authorization could be given.
• Day 255: The parties to respond, in writing, to the preliminary decision. The
response may include proposed amendments to the terms and conditions.
• Day 285: The Minister to render a final decision and publish a summary of the
decision. The Minister may, if satisfied that the proposed arrangement is in the
public interest, authorize it and specify any terms and conditions relating to
the public interest and competition that the Minister considers appropriate.
Competition Assessment by Competition Bureau

If the Minister determines that a public interest review is warranted for a joint ven-
ture, the Commissioner is required to report to the Minister and the parties on any
concerns regarding potential prevention or lessening of competition that may occur
as a result of the proposed arrangement. This may include concerns that the Com-
missioner does not have sufficient information or time to conclude whether the
joint venture is likely to prevent or lessen competition. Competition concerns with
respect to a joint venture between air carriers could arise under section 90.1 and/or
92 of the Competition Act. Further information about the Bureau’s analytical ap-
proach to the review of mergers and joint ventures can be found in the Bureau’s
Merger Enforcement Guidelines5 and Competitor Collaboration Guidelines.6
5 http://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/vwapj/cb-meg-2011-e.pdf/
$FILE/cb-meg2011-e.pdf)
6 http://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/vwapj/cb-meg-2011-e.pdf/
$FILE/cb-meg2011-e.pdf); http://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/
03177.html
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Transport Canada
Parties to a proposed joint venture are encouraged to respond quickly and com-
pletely to any requests for information that may help the Bureau complete its
assessment.
Public Interest Assessment by Transport Canada

The CTA requires that the Minister assess whether a proposed joint venture raises
significant considerations with respect to the public interest. Public interest is a
broad concept, and the nature and type of public interest issue depends on the
unique facts and context of the joint venture — not upon any pre-defined set of
criteria. Individual joint ventures may raise different public interest considerations
or concerns.
It is possible, however, to provide general guidance on the factors that may be con-
sidered in determining whether a joint venture raises public interest issues as it
relates to national air transportation. The Minister reserves the right to consider
other relevant factors in making a determination of what constitutes the public in-
terest: the CTA and any subordinate legislation take precedence over these
guidelines.
National Transportation Policy

A discussion of public interest factors begins with consideration of the National
Transportation Policy.
The National Transportation Policy7 recognizes that competition and market forces
are the prime agents to provide viable and effective transportation services. It also
provides that regulation and strategic public intervention are used to achieve eco-
nomic, safety, security, environmental or social outcomes that cannot always be
achieved satisfactorily by the marketplace.
It states that the ideal system is one where, among other things, rates and conditions
are not an undue obstacle to the movement of traffic within Canada or to the export
of goods from Canada. The ideal system should be accessible without undue obsta-
cle to the mobility of persons, including persons with disabilities.
These objectives help determine the types of public interest considerations that
could be relevant to a joint venture review. Positive public interest impacts can help
offset a proposed joint venture’s potential negative impact on competition and other
things.
Public Interest Factors

Air Carrier
Ventures
In assessing whether a joint venture raises positive or negative issues with respect
Joint
to the public interest, the following factors may be considered:
7 The National Transportation Policy is found in section 5 of the CTA, S.C. 1996, c. 10.
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Transport Canada
Economic
A. — Network Connectivity and Other Consumers Benefits
The impacts on prices and the levels of and access to services and facilities will be
of prime interest in any proposed joint venture. Increased connectivity and a more
efficient network will also be central considerations. As such, joint ventures which
have the potential to improve competition, efficiency, connectivity or those which
add capacity, enhance service, or promote economic growth in Canada will be
noted for their potentially positive impacts. For example, joint ventures will be
viewed positively if they:
• Provide an improvement in the capacity, frequency, price and efficiency of
services without unreasonable discrimination, unfair or deceptive practices;
• Provide consumers with increased direct flight services, optimized schedules,
significant time savings, and enhanced travel options and passenger conve-
nience; and
• Avoid unreasonable industry concentration and market domination/monopoly
powers which would lead to price increases, service reductions, and the exclu-
sion of competition in the air transportation market.
B. — Impacts on Communities
The impacts on the development, viability and location of industry may be a public
interest factor in some cases. Impacts on employment in a community or region, its
attractiveness for tourism or business investment may raise public interest con-
cerns, or act as a positive consideration. For example, joint ventures may be viewed
positively if they:
• Maintain and improve the system of air transportation routes for small com-
munities and remote areas;
• Ensure that consumers in small communities and remote areas have access to
affordable and regularly scheduled air service;
• Encourage air transportation at major urban areas through secondary or satel-
lite airports if consistent with regional airport plans.
• Achieve other economic efficiencies or benefits that would otherwise not be
obtainable.
C. — Impacts on the Air Sector and Other Modes of Transportation

Impacts on intermodal connections and supply to other modes of transportation
might be a public interest factor of a proposed joint venture.
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Transport Canada
Additionally, feedback from competitors to a joint venture, on whether it may ad-

versely affect one or more transportation sectors, might also be a factor. For exam-
ple, joint ventures will be viewed positively if they:
• Coordinate transportation by, and improve relations among, air carriers, and
encourage fair wages and working conditions;
• Encourage entry into air transportation markets by new and existing air carri-
ers and the continued strengthening of air carriers to ensure a more effective
and competitive airline industry;
D. — Impacts on Canada & Economic Contribution

Impacts of a joint venture on Canadian competitiveness in terms of leadership,
management and workforce expertise may be relevant to a public interest determi-
nation. Improved attractiveness of Canadian communities for business investment,
harmonization, productivity improvements and increased employment may re-
present positive public interest factors. Impacts on trade, gateways and corridors
will also be considered. Innovation, technology and R&D impacts may also be re-
viewed. Impacts on taxation and government expenditure may also be factors.
Given the scope of tourism in Canada, a joint venture’s impact on this sector will
also be assessed.
E. — Impacts on the Undertakings Involved

The financial stability of any new entity, its ability to grow, expand its network,
and achieve economies of scale, and its ability to generate operating efficiencies
may be relevant public interest factors as they would positively impact the costs
and revenues of the undertaking(s) involved.
Environmental
The capacity of a joint venture to improve the quality of life and the environment
by reducing congestion and pollution may be a positive public interest factor that
may be taken into account.
Aviation Safety
Safety impacts of a joint venture may be carefully considered where relevant. The
potential of a joint venture to improve safety of operations will be an important
consideration. Transport Canada will consider public safety as the highest priority
in all proposed joint ventures. Transport Canada will always consider and evaluate
Air Carrier
Ventures
the safety implications of those air services before authorizing a joint venture.
Joint
Security
Proposed joint ventures should not have an adverse impact on aviation security and
the Government’s capacity to protect our citizens and to respond to any threat.
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Transport Canada
Social
Where appropriate, impacts of a proposed joint venture on middle-class Canadians
and families may be reviewed. Proposed joint ventures should improve, wherever
possible, access to transportation for people with disabilities. Cultural impacts and
those affecting Canadian sovereignty may also be public interest factors.
Filing a Notice under the Canada Transportation Act

Timing of Notice to the Minister
As the process under the CTA contemplates a concurrent review of the public inter-
est by the Minister and of competition by the Commissioner, parties to a proposed
joint venture wishing to make a filing pursuant to subsection 53.71(1) of the CTA
must provide notice of a proposed joint venture to the Minister and the Commis-
sioner at the same time.
Fees
The Minister has established fees to be paid by the parties for the assessment of air
carrier joint ventures.
Level one air carriers89 applying for authorization of a joint venture are required to
pay the specified initial application fee (see Table) when the application is submit-
ted to the Minister. The initial application fee would enable Transport Canada to
assess whether there are significant public interest considerations that warrant fur-
ther assessment. If further assessment is warranted, the applicants are required to
pay the specified assessment fee (see Table). Fees have been established for both
two partner joint ventures and three and more partner joint ventures.
Table: Proposed initial application and assessment fee structure

Parties to the joint venture Proposed initial Proposed assessment
application fee fee
Two party joint ventures $28,000 $252,000
Three-or-more party joint $36,000 $304,000

ventures
8 The Transportation or Carriers Information Regulations define a level one air carrier as a
Canadian air carrier that, in the preceding calendar year, transported at least 2,000,000 reve-
nue passengers or at least 400 000 tonnes of cargo.
9 Non-level one air carriers would be exempt from the aforementioned fees.
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Transport Canada
Two payments (cheques or electronic wire) payable to the Receiver General must
be included with the application. The first cheque for the application fee will be
cashed immediately and a second cheque, for the assessment fee, will be held by
the Department and cashed at the time that a decision on the merits of the applica-
tion is made. In the event that the Minister decides that a public interest review is
not warranted, the second cheque will be returned to the applicants.
Required Assessment Information

A substantial and complete notice will allow a more focused and expeditious re-
view. This will result in fewer requests for additional information and if warranted,
fewer and more focused third party contacts. The benefit to parties will be a quicker
review since Transport Canada and the Bureau will have the opportunity to conduct
a thorough examination of the proposed joint venture in a timely way.
Notice of a proposed air carrier joint venture must include the following informa-
tion, unless otherwise agreed upon, depending on the characteristics and complex-
ity of the joint venture, by the Minister and the Commissioner, in electronic form,
from each party to the joint venture:
A. — General Information
• The information described in Subsection 114(1) of the Competition Act and
Section 16 of the Notifiable Transactions Regulations;
• All interline, codeshare, joint venture, and commercial cooperation agree-
ments including any amendments, and all memoranda of understanding in
force between the parties, and between the party and any other air carriers
related to the geographic regions where the proposed joint venture will
operate;
• A detailed description of the party’s current operations in the geographic re-
gions where the proposed joint venture will operate.
B. — Market Information and Data

• A list of all flight segments to which the proposed joint venture will apply or
to which the party expects the proposed joint venture to apply;
• For the most recent completed calendar year, a list of all origin-destination
pairs operated or marketed by the party that would fall within the geographic
scope of the proposed joint venture; and
Air Carrier
Ventures
Joint
• To the extent the proposed joint venture will operate at airports, with a Level 3
categorization in IATA’s Worldwide Airport Slots Group or that are subject to
any access restriction, a list and description of each slot pair held by the party
at each such facility.
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Transport Canada
• For each origin-destination pair that would fall within the geographic scope of
the proposed joint venture, the parties should provide an estimate of their traf-
fic share (preferably based on third party data).
• Where the traffic share of the parties is potentially more than 35% in any
such origin-destination pair, where both parties have significant market
shares, and where the proposed joint venture raises one or more factors
that tend to indicate a complex transaction under section 3.2.3 of the Bu-
reau’s Fees and Service Standards Handbook for Mergers and Merger-
Related Matters, each party must provide:
• All studies, surveys, analytical reports, presentations, board meeting
minutes, and strategic, marketing and business plans prepared or re-
ceived by the party relating to:
• The parties to the proposed joint venture; or
• The actual or potential provision of air services in the geo-
graphic regions where the proposed joint venture will operate;
• If the proposed joint venture is in respect of passenger air services,
each party must provide the party’s passenger ticketing data for each
flight segment of each ticket operated or marketed by the party dur-
ing the most recent calendar year within the geographic regions
where the proposed joint venture will operate. This data should in-
clude the following information:
• Ticket number;
• Number of coupons on ticket;
• Coupon sequence number;
• Flight date;
• Ticketing date;
• Country point of sale;
• Operating flight number;
• Marketing flight number;
• Operating carrier identifier;
• Marketing carrier identifier;
• Coupon origin;
• Coupon destination;
• Ticket origin;
• Ticket destination;
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Transport Canada
• Booking class code;

• Coupon revenue amount;
• Prorate amount;
• Ancillary fees by fee type;
• Fuel surcharge;
• Ticket revenue amount (excluding taxes, fees and surcharges);
• Coupon usage code;
• Taxes, fees and surcharges;
• Frequent flyer program indicator;
• Corporate contract indicator; and
• Ticket itinerary;
• If the proposed joint venture is in respect of cargo air services, each
party must provide the party’s waybill data for each flight segment
of each shipment operated or marketed by the party during the most
recent calendar year within the geographic regions where the pro-
posed joint venture will operate. This data should include the fol-
lowing information:
• Shipment number;
• Number of flight segments;
• Flight segment sequence number;
• Flight date;
• Booking date;
• Country point of sale;
• Shipper identifier;
• Shipper name;
• Operating flight number;
• Marketing flight number;
Air Carrier
Ventures
Joint
• Operating carrier identifier;

• Marketing carrier identifier;
• Flight segment origin;
• Flight segment destination;
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Transport Canada
• Shipment origin;
• Shipment destination;
• Shipment weight;
• Shipment dimensions;
• Type of cargo;
• Segment revenue amount;
• Prorate amount;
• Ancillary fees by fee type;
• Fuel surcharge;
• Shipment revenue amount (excluding taxes, fees and
surcharges);
• Taxes, fees and surcharges;
• Corporate contract indicator; and
• Shipment itinerary;
C. — Operating Efficiencies
• A list and detailed description of each efficiency that the party asserts is likely
to result from the proposed joint venture, including:
1. the projected dollar amount of each efficiency,
a. how the party derived this amount;
b. the percentage of this amount attributable to: fixed costs and; va-
riable costs; and
c. the percentage of this amount that the party expects to accrue to
the Canadian economy;
2. why the party believes the proposed joint venture is necessary to
achieve each efficiency, and
a. the dollar amount of each efficiency that the party believes could
be achieved without the proposed joint venture;
b. the means by which the efficiency could be achieved without the
proposed joint venture; and
c. the dollar costs and time involved to obtain the efficiency without
the proposed joint venture;
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Transport Canada
3. how the party expects to achieve each efficiency, including specific

steps the party must take and specific investments the party must make to
achieve the efficiency;
a. when the party expects to achieve the full dollar amount of each
efficiency;
b. all costs that the party expects to incur to achieve each efficiency;
and
c. the party’s assessment of the probability of achieving each effi-
ciency, and the expected portion of the efficiency achieved by year.
• For each efficiency that the party asserts is likely to result from the proposed
joint venture, the party must provide all records and data supporting the claim.
Parties are encouraged to provide complete information about efficiencies.
D. — Network Efficiencies and Expansions

• A list and detailed description of each network expansion and other network
efficiency that the party asserts is likely to result from the proposed joint ven-
ture, including:
achieve each network expansion and other network efficiency, and
2. how the party expects to achieve each network expansion and other
network efficiency, including specific steps the party must take and spe-
cific investments the party must make to achieve the network expansion
or other network efficiency;
• For each network expansion and other network efficiency that the party asserts
is likely to result from the proposed joint venture, the party must provide all
records and data supporting the claim.
E. — Other Public Interest Benefits

• A list and detailed description of each public interest benefit that the party
asserts is likely to result from the proposed joint venture, including
1. whether each public interest benefit is a direct or indirect result of the
proposed joint venture;
2. the projected dollar amount of each public interest benefit and how the
party derived this amount;
Air Carrier
Ventures

Joint
achieve each public interest benefit, including:

a. the dollar amount of each public interest benefit that the party
believes could be achieved without the proposed joint venture;
b. the means by which the public interest benefit could be achieved
without the proposed joint venture; and
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Transport Canada
c. the dollar costs and time involved to obtain the public interest
benefit without the proposed joint venture;
4. how the party expects to achieve each public interest benefit, including
specific steps the party must take and specific investments the party must
make to achieve the public interest benefit;
a. when the party expects to achieve the full public interest benefit;
b. all costs that the party expects to incur to achieve each public
interest benefit; and
c. the party’s assessment of the probability of achieving each public
interest benefit, and the expected portion of the public interest bene-
fit achieved by year.
• For each public interest benefit that the party asserts is likely to result from the
proposed joint venture, the party must provide all records and data supporting
the claim.
F. — Other requirements
Additionally, a Notice of a proposed air carrier joint venture must include the fol-
lowing from each party to the joint venture:
• A statement identifying whether the proposed joint venture will bring about a
change in substantial ownership and effective control of the parties involved in
the proposed joint venture;
• Identification of major stakeholders, other than customers and suppliers, who
may be interested in the joint venture (shippers, other levels of government,
the general public, etc.);
• A description of any consultations that have taken place with affected stake-
holders prior to notification;
• A description of any proposed mitigation or remediation of adverse competi-
tion and public interest impacts;
• Identification of any other government approvals required to complete the
joint venture including foreign approvals, actions taken to seek such approv-
als, and status of such actions.
Enforcement of Assessment Decision

Compliance
The parties must comply at all time with the terms and conditions of the authorized
arrangement. Please note that terms and conditions will not be projected benefit
targets, but rather terms and conditions by which joint venture partners must abide
in order to retain their authorization.
The Minister may, two years after having authorized an arrangement, notify the
parties of any concerns that he or she may have regarding the public interest or
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Transport Canada
competition in respect to the arrangement. Note that this two-year period does not
constitute an expiry for authorized joint ventures. Unless stipulated in the terms and
conditions, authorizations will not have an expiry date and will continue to operate
in perpetuity while the joint ventures are monitored annually.
If, at any time after this two-year period, as a result of annual monitoring, the Min-
ister observes any problems or concerns with respect to the public interests of the
joint venture in question, the Minister will notify the parties involved and may,
after consulting with the parties and the Commissioner, issue new terms and condi-
tions. The Minister may change the terms and conditions, or impose new ones, to
address the concerns that the Minister raised in the notice or review, or to maintain
the current authorization.
The Minister may allow the authorization of a joint venture to continue if the Min-
ister determines, after consulting with the Commissioner, that the arrangement,
with or without amended terms and conditions, continues to be in the public
interest.
Amendment
The parties shall notify the Minister and Commissioner of any material changes to
the joint venture arrangement for the Minister to make an assessment under s. 53.76
and 53.78 of the CTA.
Upon receiving such notification, and in consultation with the Commissioner, the
Minister may consider authorizing an amendment of a joint venture arrangement
and specify any new and additional terms and conditions. To authorize an amend-
ment, the Minister must be satisfied that the joint venture continues to be in the
public interest.
Revocation
The Minister may revoke an authorization at any time if that authorization has been
granted on the basis of information that is false or misleading or if the parties to the
arrangement have failed to comply, in any material respect, with any of the terms
and conditions of the authorization.
There are additional powers to revoke an authorization of an arrangement in two
particular situations. First, the Minister may revoke an authorization if the arrange-
ment has been amended significantly without prior authorization per s.53.79 of the
CTA. Second, the Minister may revoke an authorization if he or she is no longer
satisfied that the arrangement is in the public interest, after having notified the par-
Air Carrier
Ventures
ties of the concerns as per subsection 53.77(1) of the CTA and having considered
Joint
the parties’ response.

When revoking an authorization, the Minister will take into consideration the par-
ties’ operational requirements and may allow a certain period of time to “unwind”
the joint venture.
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Transport Canada
Non-Compliance
A superior court may, on application by the Minister of Transport, order a person to
cease contravention of section 53.72 of the CTA regarding the prohibition against
completing a notified arrangement before it is authorized by the Minister or of sec-
tion 53.78 regarding the obligation to comply with terms and conditions established
by the Minister. The superior court may also order such a person to take actions
that it considers appropriate, including the divestiture of assets. The Minister shall
notify the Commissioner before making any such application to the court.
Every person would be guilty of an indictable offence and would be liable to im-
prisonment for a term not exceeding five years or to a fine not exceeding
$10,000,000.00 or both if they complete a proposed arrangement that has been the
subject of notification to the Minister, without the Minister’s authorization, or if
they do not comply with the terms and conditions established by the Minister as a
condition of an authorization. The Attorney General of Canada considers, when
deciding to prosecute, whether there is a reasonable prospect of conviction and
whether the prosecution is in the public interest.10 The Attorney General of Canada
prosecutes cases under federal statutes, including those referred to by the Minister
of Transport.
Subsection 53.83(2) establishes that a separate offence is committed for every day
on which a person does not comply with the terms and conditions established by
the Minister for the authorization of an arrangement.
Section 53.83 creates an offence for any person that does not comply with the terms
and conditions of an authorization for an arrangement and/or who completes an
arrangement without prior authorization by the Minister.
Canadian Ownership Requirements

The CTA at s.53.74 states that “An authorization given by the Minister under sub-
section 53.73(8) does not affect any requirement that a transportation undertaking
providing air services, as defined in subsection 55(1), be Canadian, as defined in
that subsection.” Therefore, Canadian applicants should ensure this requirement11
is being fulfilled at all times. The applicants should communicate directly with the
Canadian Transportation Agency, which is responsible for rendering decision per-
taining to this requirement.
10 See s. 2.3 of the Public Prosecution Services of Canada Deskbook, 2014 available at:
http://www.ppsc-sppc.gc.ca/eng/pub/fpsd-sfpg/fps-sfp/tpd/p2/ch03.html
11 The requirement to remain Canadian also includes the requirement to be controlled in fact
by Canadians. For more information with respect to the Control in Fact requirements, it is
recommended to consult The Agency’s Interpretation Note on Control in Fact.
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Transport Canada
Monitoring of Assessment Decision

Transport Canada will continuously monitor the arrangement to ensure that the par-
ties continue to comply with the terms and conditions. Transport Canada will also
monitor authorized joint ventures to examine whether the arrangement is having the
expected positive public interest benefits. These reviews will take into considera-
tion the fact that certain benefits may take longer to be realized. Parties to an au-
thorized joint venture will be required to submit annual reports for the purposes of
continued monitoring. The annual reports must include a description of the status of
the implementation of the joint venture, including copies of any implementation
agreement, the implementation steps undertaken in the past year, the implementa-
tion steps to be undertaken in the upcoming year, and a list and description of all
non-material changes to the joint venture that occurred during the year. It must also
report on the public benefits achieved, material changes to the joint venture and the
parties’ compliance with the conditions and remedies.
Contact Information
Submission of Notice
Parties submitting notices shall do so in writing to:
Minister of Transport
Place de Ville, 330 Sparks Street
Ottawa, Ontario, Canada
K1A 0N5
Competition Bureau
Place du Portage I
50 Victoria Street, Room C-114
Gatineau, Quebec
K1A 0C9
Please also submit 2 copies of the notice, or any additional questions regarding
these guidelines to:
Director General, Air Policy
Transport Canada
Place de Ville, 330 Sparks Street
Air Carrier
Ventures
Ottawa, Ontario, Canada

Joint
K1A 0N5
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Transport Canada
Appendix A — Joint Venture Authorization Process
1072
THE 2021 ANNOTATED COMPETITION ACT
Index
INDEX
The References in the Index are to sections of the following pieces of
legislation: Competition Act (CA), Competition Tribunal Act (CTA), Com-
petition Tribunal Rules (CTR), Notifiable Transaction Regulations (NTR),
References preceded by “p.” refer to page numbers.
A • exceptions, CA 90.1(4)–(9)
Abuse of dominant position, CA 78, • gains in efficiency, CA 90.1(4)–(6)
79, 79.1 • factors, CA 90.1(2)
• prohibition order, CA 79(1) • limitation on proceedings, CA 45.1,
• unpaid monetary penalty, CA 79.1 90.1(10)
Access to documents, CTR 65–67 • orders, CA 90.1(1)
Access to public, CTR 29, 30 Amateur sport, CA 6
Administration, CA 7-29.2 Anti-competitive acts, CA 78, 79
Advance ruling certificates, CA 102, Appeals

103 • generally, CA 73(3)
Advertising, see also Misleading • prohibitions, from, CA 34(3)–(4)
advertising • Tribunal, from, CTA 13
• non-availability of advertised Application, CA 4–6
specials, CA 74.04
• publishers of, defences, CA 60 Article, defined, CA 2(1)
• sale above advertised price, CA Assets, CA 109–110
74.05 • background, CA 114
Advisory council, CTA 3(3), (4)
B
Affidavit of documents, CTR 60
Bait and switch selling, CA 74.04(2),
Affiliated, defined, CA 2(2), 77(5), (3)
(6)
Banks, agreements of, CA 49
Agreements to lessen/prevent
competition Bargain price, selling at, CA
• competitor defined, CA 90.1(11) 74.04(1)
• evidence, CA 90.1(3) Business, defined, CA 2(1)
1073
Index
C • interim orders, CTR 23

Case Management, CTR 134–139 • intervention, see Intervention
• judgment, validity when absence,
Civil action
CTA 12(3)
• admissibility of Criminal Code
proceedings, CA 36(2) • jurisdiction, CTA 8(1), CA 75
• limitation period, CA 36(4) • members
• rights not affected, CA 62, 74.08 • • acting after expiration of
appointment, CTA 5(4)
Commissioner of Competition • • judicial
• appointment, CA 7 • • • appointment, CTA 3(2)(a)
• defined, CA 2(1) • • • tenure, CTA 5(1)
• deputies, CA 8
• • lay
• opinions, CA 124.1
• • • appointment, CTA 3(2), (3), (4)
• representations to federal boards,
• • • public service employees, CTA
CA 125
6(3)
• representations to provincial boards,
CA 126 • • • remuneration, CTA 6(1)
• • • tenure, CTA 5(2)
Communication of confidential
information under the Competition • • re-appointment, CTA 5(3)
Act, information bulletin, • • temporary substitutes, CTA 5(5)
September 2013, pp. 895-910 • • when unable to take part in
• representations to provincial boards, judgment, CTA 12(3)
CA 126 • oath of office, CTA 7
Competition Tribunal • powers, CTA 8(2), (3)
• access to documents, CTR 65 • practice directions
• appeals, CTA 13 • • acknowledgement of expert
• chairman, CTA 4 witnesses, p. 1043
• conflicts of interest, CTA 10(3) • • Administrative Tribunals Support
• contempt, CTA 8(3) Service of Canada, p. 1046
• court of record, CTA 9(1) • • case management and hearing
management conferences, p. 1039
• definitions, CTA 2
• • electronic hearings, p. 1045
• establishment, CTA 3
• • filing of confidential documents,
• evidence to be oral, CTR 88(2)
p. 1031
• generally, CA 2 (commentary)
• • mediation, p. 1047
• hearings
• • new provisions of the
• • chairman, CTA 11 Competition Act, p. 1038
• • panel, CTA 10(1), (3) • • notice to parties and the legal
• • presiding officer, CTA 10(2) profession, p. 1042
1074
Index
Competition Tribunal (cont’d) • applications, CTR 35–41

• • physical security measures for • default order, CTR 41
visitors to competition tribunal, p.
• discovery of documents, CTR 60–64
1050
• evidence at hearing, CTR 71–74
• • tribunal hearing time
Index
management, p. 1044 • expert evidence, CTR 77–80
• proceedings open to public, CTR • filing of motion, CTR 43(1)
29, 30 • intervention, CTR 42–55
• proceedings to be informal, CTA • pre–hearing disclosure, CTR 68–70
9(2) • reply, CTR 39
• questions of fact/mixed fact and • response, CTR 38
law, CTA 12(1), (2)
• service of documents, CTR 37
• questions of law, CTA 12(1), (2)
• specialization agreements, CTR
• rules, see Rules, Competition 100–104
Tribunal
• variation or rescission of order,
• sittings, CTA 15, CTR 50(2) CTR 99
• travel allowances, CTA 6(2) • witness panels, CTR 75–76
Competitor Collaboration Contests, CA 74.06
Guidelines, pp. 663–715
Controlled, defined, CA 2(4)
Computer system, CA 16, 17
Corporation
Confidentiality, CA 29
• affiliated, CA 77(5), (6)
Consent Agreements, CTR 105–106 • defined, CA 2(1)
Consent orders, CA 105 • liability of directors/officers/agents,
• deceptive marketing practices, CA CA 65(4)
74.12 • trial without jury, CA 67(4)
Consideration and report, CA 19–24 Counsel
Conspiracy • inquiry, to assist at, CA 21
• foreign directives, CA 46 • representation of witnesses, CA
12(3)
• generally, CA 45
• limitation, CA 45.1, 48(3) Criminal Code proceedings
• non-application to specialization • institution of, CA 23
agreements, CA 90 • use of, in civil actions, CA 36(2)
Contempt, CTA 8(3) Crown
Contested proceedings, CTR 35–80 • Competition Act binding on, CA 2.1
• access to documents, CTR 65–67 • control by, CA 2(4)(b)
• admissions, CTR 56–59 Customs duties, removal of, CA 31
1075
Index
D • injunction, CA 33(1.1)
Deceptive marketing practices • offence, CA 52.1(2), (3), (9)
• administrative remedies, CA • officers and directors, liability of,
74.09–74.16 CA 52.1(8)
• • aggravating or mitigating factors, • punishment, CA 52.1(9)
CA 74.1(5) • sentencing, CA 52.1(10)
• • determination of reviewable • telemarketing defined, CA 52.1(1)
conduct, CA 74.1(1)
• • temporary order, CA 74.11 Defects of form, CA 3
• appeals, CA 74.18–74.19 Defences, CA 60
• bait and switch selling, CA Definitions
74.04(2), (3)
• agreements to lessen/prevent
• “bargain price” defined, CA
competition, CA 90.1(11)
74.04(1)
• civil rights not affected, CA 74.08 • Competition Tribunal Act, CTA 2
• consent agreement, CA 74.12, 74.13 • mergers, CA 91
• misrepresentations to public, CA • notifiable transactions, CA 108
74.01(1) • notifiable transactions regulations,
• • ordinary price NTR 2
• • • supplier’s own, CA 74.01(3) • specialization agreements, CA 85
• • • suppliers generally, CA Delivered pricing, CA 80, 81
74.01(2)
• • print or publish in good faith, CA Director, see Commissioner of
74.07 Competition
• • time, references to, CA 74.01(4) Directors/officers of corporations,
• prize notification, CA 53 liability, CA 65(4)
• promotional contests, CA 74.06 Discontinuance/withdrawal, CTR
• representations accompanying 26–34
product, CA 74.03(1) Discovery of documents, CTR 60–64
• representation as to reasonable test
and publication of testimonials, CA Documents
74.02 • access to, CTR 65–67
• rules of procedure, CA 74.17 • discovery of, CTR 60–64
• sale above advertised price, CA • filing of, CTR 96(3)
74.05
• production of, CA 11
Deceptive telemarketing
Dominance, Abuse of, CA 78 – 79.1
• disclosures required, CA 52.1(2)
• due diligence defence, CA 52.1(2) Double ticketing, CA 54, 60
• general impression test, CA 52.1(4) Due diligence defence, CA 52.1(6)
1076
Index
E G
Enforcement Guidelines on Abuse of Geographic price discrimination
Dominance Provisions, pp. • Goods, CA 111(a)
819–867
Index
Evidence H
• copies of records, admissibility, CA Hostile transactions interpretation
20(2), (3) • bureau policy on disclosure of
• participants, against, CA 69 information, guideline 1, p. 493
• reviewable transactions, CA 107 • bureau policy on running of
subsection 123(1) waiting periods,
• statistics, see Statistics guideline 2, p. 495
Exclusive dealing, CA 77, 90,
103.1–103.3 I
Expert evidence, CTR 77–80 Immunity Program under the
Competition Act, pp. 717–780
F Injunctions, CA 33
False advertising, see Misleading • deceptive telemarketing, CA 33(1.1)
advertising • extension or cancellation of, CA
Federal Court 33(5)
• interim, CA 33(1), 74.111
• appeals from, CA 73(3)
• punishment for disobedience, CA
• jurisdiction, CA 73(1) 33(7)
• powers, CA 32 • terms of, CA 33(4)
Fees and Service Standards Inquiry
Handbook for Merger and
Merger-Related Matters, • administration of oaths, CA 14(1)
Competition Bureau, pp. 555–575 • application for, CA 9
• attendance by person who is subject
Fees and Service Standards Policy
of, CA 12(4)
for Merger and Merger-Related
Matters, Competition Bureau, pp. • counsel, CA 21
577–585 • criminal proceedings, institution of,
CA 23
Financial institutions, agreements of,
CA 49 • discontinuance, CA 22
• formation of, CA 10
Foreign judgments/laws/directives
• information as to progress of, CA
• conspiracy, CA 46 10(2)
• refusal to implement, CA 82, 83 • obstruction of, CA 64
Foreign supplier, CA 84 • oral examination, CA 11
1077
Index
Inquiry (cont’d) • Commissioner, intervention by, CTR

• orders of presiding officer, CA 54
14(2)–(4) • • access to documents, CTR 55
• presiding officer, CA 13 • consent orders, CTR 86–90
• private, to be conducted in, CA • disposition, CTR 46
10(3)
• document list, CTR 51
• production of records, CA 11
• filing of motion, CTR 43
• records in possession of affiliate,
CA 11(2) • “intervenor” defined, CTR 1
• report, interim, CA 28 • intervention allowed, CTR 47
• self-incrimination, CA 11(3) • mergers, CA 101
• warrant for entry of premises, see • motions, CTR 27, 38–41
Search and seizure • notice, CTR 50
• witnesses, see Witnesses • province, by, CA 88, 101, CTR 49
• written return of information, CA
• reply, CTR 45
11(1)(c)
• response, CTR 28
Insurance companies, agreements of,
CA 49 • service of documents, CTR 48, 53
• specialization agreements, CA 88
Intellectual Property Enforcement
Guidelines, pp. 911–970 • Tribunal, before, CTA 9(3)
Interim orders Investigation and research, CA 7–17

• application of Part, CTR 95
J
• application to vary or set aside,
CTR 99 Joint monopolization, CA 79
• ex parte, service of, CTR 98 (commentary)
• injunction, CA 33(1) Jury trials, CA 67(1)–(4), 73(2)
• mergers, CA 100
L
• notice of application, CTR 96
• official language, CTR 97 Leniency Program, pp. 781–798
• reviewable transactions, CA 104 Limitation periods
• Tribunal, before, CTA 11 • abuse of dominant position, CA
International Competition Network’s 79(6)
Recommended Practices for • civil action, CA 36(4)
Merger Notification Procedures, • merger, CA 97
pp. 971–1008
• offences, CA 67(6)
Intervention, see also Province
Loan Order, CTR 128–133
• attorney general, participation, CTR
52 Lotteries, CA 74.06
1078
Index
M • • decision without a hearing, CTR

86
Market restriction, CA 77
• • evidence and memorandum, CTR
Merger enforcement guidelines, pp. 87
587–640
Index
• • notice of motion, CTR 83
Mergers, see Reviewable transactions • • service of response, CTR 85
• advance ruling certificates, CA 102, • • testimony by affidavit, CTR 88
103
• informal procedure, CTR 81
• guidelines, see Merger enforcement
guidelines • motion for summary disposition,
CTR 89–94
• intervention by province, CA 101
• • notice of motion, CTR 89
• merger, defined, CA 91
• • motion refused or granted, CTR
• orders, conditional, CA 99 93–94
• orders, interim, CA 100 • • testimony, CTR 91
• orders, making • • tribunal’s power, CTR 92
• • exceptions, CA 94–96, 98 • • response, CTR 90
• • factors to consider, CA 93
Multi-level marketing plan, CA 55,
• • generally, CA 92 55.1, 60
• • limitation period, CA 97
Mutual Legal Assistance
Merger review process guidelines, • agreements
pp. 641–662
• • generally, CA 30.01, 30.3
Minister, defined, CA 2(1) • • publication of, CA 30.02
Misleading advertising • • requests under, CA 30.03
• deemed representation to public, CA • Search and seizure
52(3)
• • access to premises, CA 30.06(5)
• duplication of proceedings, CA
• • application of sections 15, 16 and
52(7)
19, CA 30.04
• general impression test, CA 52(4)
• • appeals, CA 30.24
• proof of deception not required, CA
• • arrest warrant, CA 30.18
52(1.1)
• • evidence, CA 30.08, 30.1, 30.12
• representation accompanying
products, CA 52(2) • • evidence for use abroad, CA 30.1,
30.09, 30.11–30.17, 30.19(1)
• reviewable conduct, CA 52(6)
• statutory provisions, CA 52, 60 • • evidence from abroad, CA
30.25–30.28
Motions, CTR 81–94 • • lending exhibits, CA 30.19–30.23
• formal procedure, CTR 82 • • request by foreign state, CA
• • application, CTR 82 30.05(1), 30.08(2), 30.29, 30.291
1079
Index
Mutual Legal Assistance (cont’d) • regulations, generally, NTR SOR87-

• • warrant, CA 30.05(2), 30.06, 348
30.07 • regulations, power to make, CA 124
• Short Form Information, NTR 16
N
• waiting period before completion,
Notice CA 123
• application, CTR 3, 56
Notifiable Transactions and Advance
• expert witnesses, CTR 77–80 Ruling Certificates under
• of prize, CA 53 Competition Act, Procedures
• statistics, prior to admission of, CA Guide, pp. 481–503
72(1)
O
Notifiable transactions
• aggregate value, determination of, Offences, see also Punishment
NTR 4–14 • admissibility of statistics, CA 70
• application, CA 109, 110 • civil rights not affected, CA 62
• audited financial statements, NTR 3 • competition, in relation to, CA
• definitions, CA 108 45–62
• exemptions • defences, CA 60
• • acquisitions, CA 111 • directors/officers of corporation, by,
• • combinations, CA 112 CA 65(4)
• • generally, CA 113 • jurisdiction of Federal Court, CA 73
• generally, CA 108–119, 123–124, • jury trials, CA 67(1)–(4), 73(2)
NTR 16 • notice, CA 72
• information required, NTR 16 • other, CA 64, 65
• information to be certified, CA 118 • procedure for enforcing punishment,
• non-application, CA 109 CA 67
• notification to Director • statistics collected by sampling
• • exemption, generally, CA 115 methods, CA 71
• • exemptions for cross-directors of • venue of prosecutions, CA 68
affiliated companies, CA 117 Offenders
• • generally, CA 114, 115(2)
• information returns, CA 35
• • re-notification requirements, CA
• prohibitions, CA 34
118
• • where information irrelevant, CA Ordinary price claims, CA 74.01(2),
116(2), (3) (3)
• • where information unavailable,
CA 116(1) P
• prenotification, CA 114 Participant, CA 69
1080
Index
Pre-Merger Notification Production of documents, CA 11

Prohibitions, CA 34, 67(5), 79
• acquisitions of non-voting shares
and convertible securities, guideline Promotional contests, CA 74.06
5, 37
Index
Province, see also Intervention
• amalgamation, guideline 6, p. 513 • service of notice of application on,
• assets in Canada, guideline 15, p. CTR 37
544
Publishers of advertisements,
• corporate spin-offs, guideline 11, p. defences, CA 74.07
526
• creditor acquisitions, guideline 7, p. Punishment, see also Offences
518 • abuse of dominant position, CA
• definition of “Goods”, guideline 16, 79(3.1)–79(3.3)
p. 548 • bid-rigging, CA 47(2)
• definition of “Operating Business”, • conspiracy, CA 45(2)
guideline 1, p. 505 • conspiracy relating to professional
• duplication, guideline 14, p. 540 sport, CA 48
• exemptions for acquisitions, • destruction/alteration of
guideline 3, p. 508 records/things, CA 65(3)
• exemptions for combinations that • double ticketing, CA 54(2)
are joint ventures, guideline 4, p. • financial institutions, agreements of,
513 CA 49(1)
• multiple step or continuous • foreign directives, CA 46(1)
transactions, guideline 2, p. 507
• information returns, failure to make,
• Notifiable Transactions Regulations, CA 35(2), 65(2)
guideline 10, CTR p. 524
• injunctions, failure to comply with,
• satisfying information requirements, CA 33(7)
guideline 13, p. 534
• misleading advertising, CA 52(5)
• shareholder agreements, guideline 9,
511 • multi-level marketing plan, CA
55(3)
• subsequent amendment of proposed
transactions, guideline 8 • obstruction, CA 64(2)
“substantially completed”, p. 520 • procedure for enforcing, CA 67
• subsequent amendment of proposed • produce records, failure to, CA
transactions, guideline 12 “ 65(2), 65.2
“completed”, guideline 8, p. 528 • prohibitions, failure to comply with,
Price maintenance, CA 45.1, 76 CA 34(6)
• promotional contests, CA 74.06
Private Access, CTR 114–127
• pyramid selling, CA 55.1(2)
Privilege, solicitor-client, CA 19
• representations/testimonials, CA
Product, defined, CA 2(1) 74.02
1081
Index
Punishment (cont’d) Reviewable matters, CA 74.01–74.16,

• sale above advertised price, CA see also Deceptive marketing
74.05 practices
• warrant, failure to comply with, CA • administrative remedies, CA
65(1), 65.1 74.09–74.16
Purpose, CA 1.1 • appeals, CA 74.18–74.19
Pyramid selling, CA 55.1, 60 • rules of procedure, CA 74.17
Reviewable transactions, see also
Q Rules, Competition Tribunal
Questions of law, CTA 12(1), (2) • applications by Director
• • notice of application, CTR 36
R
• • reply, CTR 39
Records, see also Search and seizure • • response, CTR 38
• defined, CA 2(1) • • responses, order in default, CTR
• destruction/alteration, CA 65(3) 41
• inspection/copies, CA 18, 20 • consent agreements, CA 105
• production, CA 11 • evidence, CA 107
• seizure, CA 15, 16 • generally, CA 75–107
References, CTR 107–113 • interim orders, CA 104
Refusal to deal, CA 75, 103.1–103.3 • variation/rescission of agreements,
CA 106, CTR 49
Register of specialization
agreements, CA 89 Rules, Competition Tribunal
Regulations, power to make • advance publication, CTA 17
• Competition Act, CA 128 • applications of Director, CTR 3–7
• investigation and research, CA 24 • consent agreements, CTR 105–106
• notifiable transactions, CA 124 • definitions, CTR 2
Remedies, CA 31–36 • discovery of documents, CTR 60–64
• interim orders, CTR 95–99
Report to Parliament, CA 127
• interpretation, CTR 1
Representations
• power to make, CTA 16(1)
• compensation, relating to, CA 55,
60 • pre-hearing disclosure, CTR 68–70
• reasonable test, as to, CA 60, 74.02 • quorum needed to make, CTA 16(4)
• specialization agreements, CTR
Response, CTR 38, 44 100–104
Restraint of trade, remedies to • tabling before Parliament, CTA
lessen, CA 32 16(3)
Restrictive trade practices, CA 84 • when effective, CTA 16(2)
1082
Index
S • notice of application, CTR 100

Sale above advertised price, CA • register of, CA 89
74.05 • registration
Sanctions, see Punishment • • generally, CA 86
Index
• reply, CTR 103
Search and seizure
• computer system, use of, CA 16 Sports
• copies of thing seized, CA 18(3) • amateur, application of Act to, CA
6
• data, of, CA 16
• professional, conspiracy relating to,
• generally, CA 15
CA 48
• offences, CA 65
Staff, CA 25–27, 29
• presentation/report on thing seized,
CA 17 Statistics
• retention of thing seized, CA 17(3), • admissibility, CA 70, 71
18(4) • attendance of preparer for cross-
• return of thing seized, CA 18(4) examination, CA 72(2), (3)
• solicitor-client privilege, CA 19 • notice required before admission,
CA 72(1)
Self-incrimination, CA 11(3)
Subsidiary, defined, CA 2(3)
Service
• documents, intervention, CTR 48, Suggested retail price, CA 61
53 Supply, defined, CA 2(1)
• loan order, CTR 31
• motion for intervention, CTR 42 T
• notice of application, CTR 37, 53, Telemarketing, see also Deceptive
55 telemarketing
• private access, CTR 123, 127 • defined, CA 52.1(1)
• response, formal procedure, CTR 85 Testimonials, CA 53, 60
Service, defined, CA 2(1) Tied selling, CA 77
Solicitor-client privilege, CA 19 Timetable of application, CTR 40
Specialization agreements, see also Trade, industry or profession,
Reviewable transactions defined, CA 2(1)
• definitions, CA 85
Tribunal, see Competition Tribunal
• motion for registration, CA 102
• non-application of Trust companies, agreements of, CA
conspiracy/exclusive 49
dealing/agreements to lessen/prevent
competition provisions, CA 90 U
• notice of appearance, CTR 101 Underwriting, CA 5
1083
Index
V • inquiry, at
Variation/rescission of orders, CA • • competence/compellability, CA
106, CTR 49 12(1)
• • fees, CA 12(2)
W • • representation by counsel, CA
Whistleblowing, CA 66.1 12(3)
• confidentiality, CA 66.1(2) • panels, CTR 75–76
• prohibition from disciplining • • manner of testimony, CTR 78
employee for whistleblowing, CA
66.2
Withdrawal/discontinuance, CTR
50–51
Witnesses
• expert, CTR 77–80
1084

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The Annotated Competition Act 2021 Wakil

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THE 2021 ANNOTATED

Omar Wakil, BA LLB LLM

OF THE ONTARIO BAR

STATUTES OF CANADA ANNOTATED

Printed in United States by Thomson Reuters.

THOMSON REUTERS CANADA, A DIVISION OF THOMSON REUTERS CANADA LIMITED

Competition Act and Regulations

Competition Tribunal Act and Regulations

Competition Bureau Guidelines

Competitor Collaboration Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 663

International Competition Network’s Recommended Practices

29.2 Communication to Minister of Finance . . . . . . . . . . . . . . . . . . . . . 49

PART IV — SPECIAL REMEDIES

73 Jurisdiction of Federal Court . . . . . . . . . . . . . . . . . . . . . . . . . . . 178

81 Delivered pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 247

110 Application of Part . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 310

87-348 — NOTIFIABLE TRANSACTIONS REGULATIONS

COMPETITION TRIBUNAL ACT

2008-141 — COMPETITION TRIBUNAL RULES

137 Direction regarding list of matters to be considered . . . . . . . . . . . 472

Ashley v. Canada (Commissioner of Competi- Balanyk v. University of Toronto, 1999 Cars-

Boivin c. R., see R. v. Boivin Canada (Commissioner of Competition) v. Burns

Canada (Commissioner of Competition) v. Canada (Commissioner of Competition) v.

Commissioner of Competition v. Easton Sports Couture v. Hewison, [1983] 2 W.W.R. 267, 41

Dir. of Investigation & Research v. Broadcast Director of Investigation and Research) v.

R. v. Ameublements Leger Inc. (1975), 26 R. v. Big Mac Investments Ltd. (1988), 24

R. v. Chambre d’Immeuble du Saguenay-Lac R. v. Cunningham Drug Stores Ltd. (1973), 13

R. c. Fedele, 2018 QCCA 1901 R. v. Independent Order of Foresters, [1989]

R. v. Sunrise Lighting Distributors (Maritime) R. v. Westfair Foods Ltd. (1986), 33 B.L.R.

Agreements between Competitors

International Conspiracies — Implementing Foreign Directives — Section 46

Bid Rigging — Section 47

Industry-Specific Offences — Sections 48 and 49

Immunity and Leniency

Reviewable Practices — Section 90.1

Practice of Anti-Competitive Acts

Substantial Prevention or Lessening of Competition

Other Reviewable Practices

Thresholds for Review

5 Subject to an annual increase tied to the increase in Canadian GDP.

Advance Ruling Certificates

Deceptive Marketing Practices

6 Contests open to Quebec residents are also subject to Quebec-specific legislation.

PART I — PURPOSE AND INTERPRETATION (SS. 1.1–6)

and in order to provide consumers with competitive prices and product

“monopoly” [Repealed R.S.C. 1985, c. 19 (2nd Supp.), s. 20(2).]

or otherwise, otherwise than by way of security only, by or for the

2.1 Binding on agents of Her Majesty in certain cases — This Act is

Sebastian v. Saskatchewan (Dept. of Highways & Transportation) (1987), 61 Sask. R. 71,

3. Defects of form — No proceedings under this Act shall be deemed inva-

[Heading repealed 1992, c. 1, s. 45.]

4. (1) Collective bargaining activities — Nothing in this Act applies in

4.1 [Repealed 2009, c. 2, s. 407.]

5. (1) Underwriters — Section 45 does not apply in respect of an agreement

PART II — ADMINISTRATION (SS. 7–29.2)

7. (1) Commissioner of Competition — The Governor in Council may

8. (1) Deputy Commissioners — One or more persons may be appointed

(2) Powers of Deputy — The Governor in Council may authorize a Deputy

(c) a concise statement of the evidence supporting their opinion.

10. (1) Inquiry by Commissioner — The Commissioner shall

11. (1) Order for oral examination, production or written return —

(b) produce to the Commissioner or the authorized representative of the

12. (1) Witness competent and compellable — Any person summoned

13. (1) Presiding officer — Any person may be designated as a presiding