Keith Mack
Competition law in Canada is outlined in the Competition Act, a federal statute that aims to maintain and encourage competition in the country. The Act addresses mergers, criminal matters, and reviewable practices, with the goal of preventing anti-competitive practices in the marketplace. It is administered and enforced by the Competition Bureau and the Commissioner of Competition, with recent amendments granting private parties greater rights to initiate proceedings and seek damages for violations. The Act has undergone significant revisions over the years, with the most recent wave of changes in 2022-2024, fundamentally altering the competition law landscape in Canada.
| Characteristics | Values |
|---|---|
| Purpose | To maintain and encourage competition in Canada |
| Addressed categories of conduct | Mergers, criminal matters, and reviewable practices |
| Merger definition | The acquisition or establishment of control over, or a significant interest in, the whole or a part of a business of a competitor, supplier, customer, or other person |
| Merger review framework | Pre-merger notification provisions applicable to large transactions and substantive merger review provisions applicable to all transactions |
| Private party rights | Right to sue to recover actual damages suffered as a result of a violation of the Act's criminal provisions; Right to initiate proceedings before the Competition Tribunal |
| Criminal offence provisions | Conspiracy and bid-rigging |
| Recent amendments | Three waves of amendments introduced in 2022, with the most recent changes receiving royal assent on June 20, 2024 |
| Administering and enforcing authorities | The Competition Bureau, the Commissioner of Competition, and the Public Prosecutions Service of Canada |
| Scope of application | Applies to all business activities in Canada, with certain limited exceptions |
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What You'll Learn
History of Competition Law in Canada
Competition law in Canada has evolved over the years, with the country's competition policy aimed at eliminating private restraints on trade and encouraging competition. The history of competition law in Canada can be traced back to 1889, with the enactment of the Anti-Combines Act. This was followed by the Combines Investigation Act in 1910, which was subsequently replaced by the Combines Investigation Act of 1923 and later, 1937. The focus during this period was on anti-trust provisions, with the 1923 Act remaining in force until it was amended in 1960.
A significant development came in 1985 when the conservative government replaced the 1923 Act with the Competition Act, which came into effect on June 19, 1986. This new Act introduced provisions for civil mergers, addressing both horizontal and vertical mergers, and replacing the criminal code provisions that had been largely ineffective. The Competition Tribunal, established in 1986, was given exclusive jurisdiction to hear certain competition matters, particularly those related to civil mergers.
During the 1980s and 1990s, fines for conspiracy cases increased significantly, with a notable case in 1998 where US-based Archer Daniels Midland (ADM) paid a total of $16 million in fines for conspiracies involving lysine and citric acid. These fines amounted to a substantial percentage of ADM's sales in Canada during the conspiracy.
The Competition Act has undergone several amendments since its inception. Notable amendments occurred in 2009 and 2010, resulting in the repeal or conversion of several criminal offences into reviewable practices. As a result, only conspiracy and bid-rigging remain as criminal offences in the Act. The Act continues to be periodically reviewed and updated, with the most recent amendment occurring in 2022 as part of Canada's Budget Implementation Act.
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The Competition Act
Competition law in Canada is outlined in a single federal statute, the Competition Act. The Act is enforced and administered by the Competition Bureau and the Public Prosecutions Service of Canada. The Act applies to all business activities in Canada, barring a few exceptions.
The Act defines a merger as the acquisition or establishment of control over, or a significant interest in, a business, competitor, supplier, customer, or other related parties. This broad definition captures various types of transactions, including asset acquisitions, share purchases, amalgamations, and combinations. The Act includes a framework for merger review, with pre-merger notification provisions for large transactions and substantive merger review provisions for all transactions.
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The Competition Tribunal
Competition law in Canada is set out in a single federal statute, the Competition Act. The Act is administered and enforced by the Commissioner of Competition, the Competition Bureau (the "Bureau"), and the Public Prosecutions Service of Canada. The Competition Act defines a merger as the acquisition or establishment of control over, or a significant interest in, a business, whether by purchase or lease of shares or assets, or by amalgamation, combination, or otherwise.
During the 1980s and 1990s, fines in conspiracy cases increased significantly. A notable case occurred on May 27, 1998, when US-based Archer Daniels Midland (ADM) pleaded guilty and paid a total of $16 million in fines for conspiracies involving lysine and citric acid. These fines amounted to a considerable percentage of ADM's sales in Canada during the conspiracy.
Amendments to the Competition Act in 2002 granted private parties the right to initiate proceedings before the Competition Tribunal in specific cases. Further amendments in 2009 and 2010 resulted in several criminal offences being repealed or converted into reviewable practices, with conspiracy and bid-rigging remaining as the only criminal offences in the Act. In 2022, the Government of Canada introduced three waves of amendments to the Act, resulting in significant revisions to the country's competition laws. These changes included new rights for private parties to bring applications directly to the Tribunal, strengthened greenwashing provisions, new prohibitions on wage-fixing and no-poach agreements, and increased penalties for civilly reviewable matters.
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Private Party Rights
Competition law in Canada, also known as antitrust law, is a body of law that promotes and maintains fair competition in the marketplace. It comprises federal and provincial statutes and common law rules designed to
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Merger Review
Competition law in Canada is set out in the Competition Act, a federal statute. The Act is administered and enforced by the Competition Bureau (the Bureau) and the Public Prosecutions Service of Canada. The purpose of the Act is to maintain and encourage competition in Canada, and it addresses three categories of conduct: mergers, criminal matters, and
The Act defines a merger as the acquisition or establishment of control over, or a significant interest in, the whole or part of a business. This includes purchases or leases of shares or assets, or amalgamation, combination, or other means. The Act includes a comprehensive framework for merger review in Canada, with two key components: pre-merger notification provisions for large transactions, and substantive merger review provisions for all transactions. Pre-merger notification is mandatory for certain types of mergers, such as asset acquisitions, share purchases, amalgamations, combinations, and acquisitions of interests in combinations.
The pre-merger notification process requires the filing of a notification form and/or requesting an advance ruling certificate (ARC). The notification form collects information about the business and its operations, financial statements, and customer and supplier lists. Strategic documents related to the transaction, such as business and marketing plans, must also be submitted. An ARC request is a letter that describes the transaction and explains why it should not be of concern to the Bureau.
During the initial 30-day review period, the Bureau may issue a Supplementary Information Request (SIR) for transactions that raise significant competition law concerns. Compliance with an SIR extends the waiting period until 30 days after the request is fulfilled.
The substantive merger review provisions apply to all transactions and are independent of the pre-merger notification provisions. These provisions address the potential anti-competitive effects of mergers, which may result in remedial cease-and-desist orders. The review process considers the impact on competition in the Canadian market and may examine foreign transactions where parties have an interest in a Canadian business.
Recent amendments to the Competition Act in 2022 and 2024 have resulted in significant changes to Canada's competition laws. These revisions include new rights for private parties to bring applications directly to the Competition Tribunal and increased penalties for civilly reviewable matters. The Affordable Housing and Groceries Act (proposed in September 2023) includes a proposal to remove the "efficiencies defence" in merger cases, further shaping the merger review landscape in Canada.
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Frequently asked questions
The Competition Act is a federal statute that contains both criminal and civil provisions aimed at preventing anti-competitive practices in the marketplace. The Act is administered and enforced by the Competition Bureau and the Commissioner of Competition.
The Competition Act addresses mergers, criminal matters, and reviewable practices. A merger is defined as the acquisition or establishment of control over, or a significant interest in, a business, supplier, customer, or other related entities. Reviewable practices refer to ordinary, lawful business practices that may sometimes have anti-competitive effects.
Yes, private parties have certain rights under the Competition Act. They can initiate proceedings to prove violations of criminal provisions and recover damages. Private parties can also bring applications directly to the Competition Tribunal and benefit from increased enforcement rights due to recent amendments.
