Canadian COMPETITION LAW

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.

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“A whistleblower is a person who voluntarily provides information to the Competition Bureau about a possible past, present, or future violation of the Competition Act.”

(Competition Bureau,
Bid-rigging, price-fixing and other agreements between competitors)

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OVERVIEW OF COMPETITION ACT
WHISTLEBLOWER PROTECTIONS

In addition to the Competition Bureau’s Immunity and Leniency Programs, under which parties can report violations of the federal Competition Act for potential immunity from prosecution or leniency in sentencing, the Act also includes standalone “whistleblower” provisions with protections for people that report potential competition law violations to the Competition Bureau (sections 66.1 and 66.2 of the Act).

In general, the whistleblower provisions of the Competition Act provide that any person with “reasonable grounds” to believe that a person has committed (or intends to commit) an offence under the Competition Act can notify the Commissioner of Competition and request that his/her identity be kept confidential.

The whistleblower sections also make it a criminal offence for employers to dismiss, suspend, demote, discipline harass or otherwise disadvantage an employee or deny them employment benefits because they, acting in good faith and based on a reasonable belief, did any of the following:

1. Reported a Competition Act offence committed by the employer or other person.

2. Refused to do anything that is an offence under the Competition Act.

3. Took steps to avoid an offence under the Competition Act.

COMPETITION BUREAU
WHISTLEBLOWER POLICIES

The Competition Bureau has set out its policies regarding whistleblowers under the Competition Act, including its positions on whistleblower protections generally, confidentiality, process for contacting the Competition Bureau as a whistleblower and any subsequent Bureau investigation.

For more information, see: Bid-rigging, price-fixing and other agreements between competitors.

PROTECTING WHISTLEBLOWER CONFIDENTIALITY

The Competition Bureau’s confidentiality policy for whistleblowers is set out in its Information Bulletin on the Communication of Confidential Information Under the Competition Act:

“Under section 66.1 of the Act (commonly referred to as the whistleblowing provision), anyone who has reasonable grounds to believe that a person has committed or intends to commit a criminal offence under the Act may notify the Bureau of the particulars of the matter and may request that his or her identity be kept confidential. The Bureau will keep confidential the identity of a person who has made such disclosure and to whom an assurance of confidentiality has been provided.  When a person has accepted such an assurance, his or her identity and any information that could reveal his or her identity is confidential and cannot be communicated under section 29 of the Act without the consent of that person.

Information provided by a whistleblower, other than his or her identity and any information that could reveal his or her identity, may be communicated under section 29 of the Act in the four limited circumstances set out in section 3.2 of this Bulletin.  Where information provided by a whistleblower is communicated in such circumstances, the Bureau will make every effort to ensure that the communicated information does not disclose the identity of the whistleblower or any other information that could reveal his or her identity.”

WHISTLEBLOWERS AND CANADIAN COMPETITION LAW
COMPLIANCE PROGRAMS

The Competition Bureau has also taken the position that credible and effective competition law compliance programs should address whistleblowers.

For example, in the Competition Bureau’s Compliance Hub, which is the Bureau’s online competition law compliance program resource, it states that as part of an effective reporting mechanism, which is one element of a credible and effective competition law compliance program, organizations should protect whistleblowers.

More specifically, the Bureau recommends:

1. To inspire confidence in the reporting system, all people reporting concerns should be protected from retaliation.

2. Retaliation is a serious and pervasive risk. So, depending on the circumstances of an organization, it should consider treating retaliation as a separate risk area in compliance risk assessments.

3. Organizations should sensitize managers to the fact that unfair criticism of a whistleblower is retaliation.

4. Human resources departments should advise their compliance teams and/or senior management if it observes or hears about any retaliatory action taken or threatened against a whistleblower.

5. Organizations should investigate all complaints of retaliatory threats or actions.

6. Organizations should follow up on any findings of retaliation with strong disciplinary measures.

7. As far as possible, organizations should respect anonymity requests.

8. People in at-risk roles should be trained about the Competition Bureau’s Immunity and Leniency Programs and whistleblowing initiatives.

COMPETITION ACT
REPRISAL ACTIONS

In addition to the Competition Act’s whistleblower protections, 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.

For more information, see: Reprisal Actions.

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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