SWEEPING CANADIAN COMPETITION ACT
AMENDMENTS (BILL C-59) PASSED JUNE 20, 2024
On June 20, 2024, Bill C-59 was passed (the Fall Economic Statement Implementation Act, 2023), which introduced the third of three significant rounds of amendments to Canada’s federal Competition Act in two years (together with Bill C-19 and Bill C-56). This new round of amendments to the Competition Act completes a sweeping overhaul of the Competition Act across virtually all key provisions of Canada’s competition legislation. These amendments are also the most significant changes to Canadian competition law since the modern Competition Act came into effect in 1986 replacing the former Combines Investigation Act.
The Bill C-59 amendments, among other things, strengthen the Competition Bureau’s powers to enforce key deceptive marketing provisions of the Competition Act (e.g., relating to drip pricing, performance claims and ordinary selling price (OSP) claims), strengthen private party rights to seek Competition Tribunal remedies (e.g., for civil deceptive marketing and violations of the civil agreements provisions of the Act), introduce new penalties (e.g., administrative monetary penalties for violating the civil agreements provisions of the Act and for reprisal actions penalizing individuals for complying with the Act) and introduce a new clearance regime for environmental protection related agreements. Canada’s Competition Act merger review regime was also substantially overhauled, eliminating the efficiency defence, introducing market share presumptions and a more restrictive remedial test for restoring competition.
These amendments, together with those enacted in June 2022 and December 2023 (Bill C-19 and Bill C-56), increase the potential competition law risk for companies, trade and professional associations and other entities, particularly those without credible and effective competition law compliance programs and that have not reviewed their business practices to reflect Canada’s new competition laws. For the Competition Bureau’s summary of the June 20, 2024 Bill C-59 amendments to the Competition Act, see: Guide to the June 2024 amendments to the Competition Act (June 25, 2024).
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Competition Bureau Preliminary Guidance on the Mergers
and Restrictive Trade Practices Provisions of the Competition Act
On November 7, 2024, the Competition Bureau issued preliminary guidance relating to the recent changes to the provisions on mergers and restrictive trade practices under the Competition Act – see: here.
ENVIRONMENTAL AGREEMENT CERTIFICATES
As a result of amendments to the Competition Act on June 20 2024 under Bill C-59, a new mechanism was introduced allowing Canada’s Commissioner of Competition to issue environmental agreement certificates.
An environmental clearance certificate, where issued, confirms that the Commissioner is satisfied that a proposed agreement is both: (i) for the purpose of protecting the environment; and (ii) not likely to prevent or lessen competition substantially in a market (Competition Act, section 124.3(1)).
Where an environmental agreement certificate is valid and registered with Canada’s federal Competition Tribunal, the following sections of the Competition Act will not apply: sections 45 (criminal conspiracy agreements), 47 (criminal bid-rigging) and 90.1 (the civil agreements provision) (Competition Act, section 124.5).
An environmental agreement certificate can, therefore, provide an exception to the conspiracy/cartel related provisions of the Competition Act where it is validly issued and registered with the Competition Tribunal, providing comfort to parties to environment-related agreements that they do not face potential criminal competition law liability.
Environmental agreement certificates can be issued by the Commissioner of Competition for up to 10 years, which can be extended for further 10-year periods on the request of the parties to an agreement (Competition Act, section 124.3(6)).
Environmental agreement certificates do not, however, appear to be available for existing agreements. In this respect, section 124.3(1) of the Competition Act provides that the certificates are available for a party or parties “that propose to enter into an agreement or arrangement”).
Also, in its Guide to the June 2024 amendments to the Competition Act, the Competition Bureau states that “[b]usinesses considering collaborating with one another to protect the environment can seek a certificate from the Competition Bureau confirming that the Competition Act’s conspiracy, bid-rigging and civil agreement provisions will not apply to the collaboration.”
For more information about the conspiracy (section 45), bid-rigging (section 47) and civil agreements (section 90.1) provisions of the Competition Act, see: Conspiracy (Cartels) and Bid-Rigging.
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SERVICES AND CONTACT
We are a Toronto based competition and advertising law firm offering business and individual clients efficient and strategic advice in relation to competition/antitrust, advertising, Internet and new media law and contest law. We also offer competition and regulatory law compliance, education and policy services to companies, trade and professional associations and government agencies.
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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