A few days ago we posted a short note describing the Royal Bank of Scotland N.V. (Canada) Branch (“RBS”) obtaining a stay in Ontario Superior Court to produce documents under section 11 orders obtained by the federal Competition Bureau (the “Bureau”) (see: RBS Wins Stay in LIBOR-TIBOR Price-fixing Case).
A few more details of this interesting development are emerging, which also involves antitrust enforcement agencies in the United States, Europe, Japan and Switzerland, and which relates to allegations that a number of global banks coordinated to fix interbank lending rates, including the Tokyo interbank offered rate (or “TIBOR”).
These include:
1. The Commissioner of Competition (the “Commissioner”) obtained a section 11 order to compel RBS to produce a significant volume of documents from several of its foreign affiliates.
2. Section 11 orders were obtained compelling production of documents from five banks.
3. Several extensions were granted by the Commissioner for RBS to comply with the production order before it sought and obtained the stay.
4. RBS has argued to set aside the section 11 order on the basis of, among other things: (i) a technical argument (because documents were not requested under the relevant provision of the Competition Act, subparagraph 11(1)(b) of the Act), (ii) a failure by the Commissioner to make full and frank disclosure to the Court (the Ontario Superior Court) regarding the fact that no subparagraph 11(1)(b) request was being made, and (iii) Charter arguments (alleged violations of sections 7 and 8 of the Charter – life, liberty and security of the person and unreasonable search and seizure).
This interesting development in this ongoing global price-fixing case is now one of several constitutional challenges being made under the Competition Act (the other being the ongoing Rogers performance claims case – see: Rogers Makes Constitutional Arguments in Response to Performance Claims Challenge by Competition Bureau).
As we said in our earlier LIBOR-TIBOR post, while constitutional challenges under the Competition Act, as well as the former Combines Investigation Act, have been common over the past century, they have seldom been successful.
Having said that, at least in the Rogers case, there may now be significantly more latitude to launch such challenges under the Act given, for example, the significant broadening of penalties and other enforcement powers (e.g., “administrative monetary penalties” or “AMPs” under the civil misleading advertising provisions of the Competition Act of up to $10 million).
In any event, many will be watching these challenges to the Bureau and amended Competition Act with some interest.
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