Canadian COMPETITION LAW

Excerpt from Featured Update
Practical Law Canada Competition

May 13, 2016

On May 10, 2016, the Competition Tribunal (Tribunal) released its full reasons in the landmark Toronto Real Estate Board (TREB) abuse of dominance case (The Commissioner of Competition v. The Toronto Real Estate Board, 2016 Comp. Trib. 7 (Competition Trib.)). This decision is the culmination of five years of litigation, including a Federal Court of Appeal decision that redefined and expanded the law of abuse of dominance in Canada. For more information about abuse of dominance, see Practice Note, Abuse of Dominance (Sections 78 and 79 of the Competition Act).

In general, this case involved restrictions imposed by TREB on its members’ use of some of its key Multiple Listing Service (MLS) data, such as property sold information, for innovative online products and services, such as “virtual office websites” (VOWs) (VOW Restrictions). VOWs are password-protected areas of real estate brokerages’ websites where consumers can access and search for MLS information normally only available to TREB members or their potential clients by more traditional means (for example, in person, by e-mail or fax).

The thrust of this case, in which the Commissioner of Competition (Commissioner) was successful in proving that TREB abused its dominance contrary to section 79 of the Competition Act, R.S.C. 1985, c. C-34 (Competition Act), was whether the restrictions imposed by the real estate board on its members made it difficult or impossible for innovative online brokerages to compete with traditional bricks-and-mortar models.

The Tribunal’s decision is important for a number of reasons, including expanding abuse of dominance case law generally and providing more specific guidance to companies and associations in relation to specific issues including what constitutes an anti-competitive act under section 79 of the Competition Act, what may constitute valid business justifications for otherwise anti-competitive activities, the types of evidence the Tribunal will consider in abuse of dominance cases, abuse of dominance issues specifically in the context of trade associations and the intersection of competition and intellectual property law. For more information, see Implications.

While the remedy in this case remains to be determined following submissions from the parties, the Tribunal indicated that it will need to remove restrictions on the ability of innovative Internet-based brokerages to offer new real estate products and services to consumers to compete with traditional brokers and agents.

This Featured Update provides a history of the case, key points from the redetermination decision and its implications. It also discusses some of the important trade association related findings of the Tribunal.

For the full Featured Update, see: Landmark TREB Abuse of Dominance Case May Open the Door for New Real Estate Models in Toronto.

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Our experience includes advising clients in Toronto, across Canada and the United States on the application of Canadian competition and regulatory laws and we have worked on hundreds of domestic and cross-border competition, advertising and marketing, promotional contest (sweepstakes), conspiracy (cartel), abuse of dominance, compliance, refusal to deal and pricing and distribution matters. For more information about our competition and advertising law services see: competition law services.

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