Canada’s federal government introduced 30 pages of amendments to the Competition Act, in an omnibus bill following its Fall Economic Statement.
The Bill, C-59, includes many notable amendments to the Act, which major Canadian law firms call “pivotal and transformative” and makes Canada “a serious contender for the most statutory change in the shortest period of time.”
Bill C-59 follows an earlier Bill C-56, introduced in September. The earlier bill focused on three revisions to the Act. It would remove the efficiencies defence, which the government noted “allows anti-competitive mergers to survive challenges if corporate efficiencies offset the harm to competition, even when Canadian consumers would pay higher prices and have fewer choices.”
Bill C-56 endorsed two other measures from the recent competition policy review, giving the Competition Bureau the power to compel the production of information to conduct market studies and empowering it to act against collaborations that reduce choice related to geography in the grocery sector.
Bill C-56 is moving forward on an accelerated timeline. The Finance Committee review recommended a number of amendments, including higher administrative monetary penalties, allowing the Commissioner of Competition to launch market studies in addition to the Minister of Industry, and a wider definition of abuse of dominance. The updated version could reach the Senate before year’s end.
The revisions proposed in Bill C-59, tabled November 30, are broader. They reflect many of the opinions received in the call for submissions earlier this year, which urged Canada to adopt legislation more similar to other countries. Canada’s Competition Act’s last significant revision was in 2009.
Within the 30 pages of revisions in Bill C-59 are measures to:
Make more mergers subject to review. Rules would also make it easier for the Bureau to halt mergers while interim injunctions are in play. High market shares can also be used to oppose mergers. The statute of limitations would increase from one year to three years after closing for certain mergers.
Allow more private challenges. Private parties (other companies) can challenge companies under the current Act, but only under limited conditions. The amendments would expand those conditions to include deceptive marketing and competitor collaboration.
Increase penalties and sanctions. Businesses may need to divest assets, and pay penalties up to 3% of annual gross revenues as part of new remedies.
Target greenwashing. The bill allows the Competition Commissioner to certify agreements for the purpose of protecting the environment if it’s not likely to substantially lessen competition.
Consumers Council of Canada’s submission on competition law reform earlier this year urged changes to create a marketplace more focused on consumer benefits. While other countries prioritize consumer benefits, Canada’s existing policies prioritize efficiency considerations that benefit specific companies and shareholders.