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.
REPRISAL ACTIONS
(SECTIONS 107.1-107.6 OF THE COMPETITION ACT)
As a result of amendments to the Competition Act on June 20 2024 under Bill C-59, new provisions to prohibit “reprisal actions” were enacted (sections 107.1-107.6 of the Competition Act).
Under these new provisions, actions taken by companies and other types of organizations to penalize, punish, discipline, harass or disadvantage any person because of their communications or cooperation with the Competition Bureau would be subject to potential court orders and monetary penalties.
In this regard, under these new reprisal action provisions, an application can be brought by either the Commissioner of Competition (who heads Canada’ federal Competition Bureau) or a person directly and substantially affected by an alleged reprisal action.
The potential penalties for violating these reprisal action provisions include prohibition orders to stop a person from continuing the conduct (section 107.2 of the Competition Act) and administrative monetary penalties of, for an individual, up to $750,000 ($1 million for subsequent orders) and, for corporations, up to $10 million ($15 million for subsequent orders) (section 107.3 of the Competition Act).
According to the Competition Bureau, these new reprisal action provisions will provide “an additional layer of protection for whistleblowers, complainants, industry participants and others that come forward and provide assistance under the Competition Act” (see: Competition Bureau, Guide to the June 2024 amendments to the Competition Act (June 25, 2024)).
The new reprisal action provisions of the Competition Act are in addition to existing safeguards for people that report violations of the Competition Act to the Competition Bureau, including the whistleblower provisions of the Act (see: Competition Complaints, Whistleblowers and Whistleblower FAQs).
For more information about enforcement under the Competition Act, see: Competition Law Enforcement and Immunity and Leniency Programs.
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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.
To contact us about a potential legal matter, see: contact
For more information about our firm, visit our website: Competitionlawyer.ca
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