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January 30, 2013

Earlier today, Canada’s Interim Commissioner of Competition John Pecman delivered remarks in Montreal on the Competition Bureau’s current activities and priorities.  In this, Mr. Pecman’s third speech since taking over from the former Commissioner (see previous speeches here and here), he discussed the Bureau’s use of section 11 orders, consent agreements, misleading advertising, cartels and its work with Quebec’s anti-corruption unit.

Some of the aspects of the Interim Commissioner’s remarks that I found interesting included confirming work to develop price maintenance guidelines and updated FAQs for the Bureau’s Leniency Program and announcing that the first course of action to obtain information from targets in formal inquiries in non-merger cases (except in exceptional cases) will be through section 11 court orders.

With respect to the Bureau’s sterner and increased use of section 11 orders, the Interim Commissioner indicated that the Bureau’s new approach had stemmed from an increased frustration with obtaining complete and timely information through voluntary information requests.  Where the Bureau has commenced a formal inquiry, it may request information voluntarily or compel production through section 11 orders or through the use of search warrants.  Also, as with the Bureau’s increased enforcement stance in other areas, notably cartels, the Interim Commissioner emphasized a desire in his section 11 related remarks today for the Bureau to use all of the tools Parliament had provided in the Competition Act.

With respect to recent and ongoing matters, the Interim Commissioner generally re-iterated stepped-up enforcement at the Bureau (referring to a “commitment to the vigorous enforcement of the Act”).  He also discussed the Bureau’s recent abuse of dominance case commenced against two Ontario water heater suppliers (Direct Energy Limited and Reliance Comfort Limited), misleading advertising case in the telecom sector (involving Bell, Rogers, Telus and the Canadian Wireless Telecommunications Association) and retail gas price-fixing investigation in Quebec – which has led to 39 individuals and 15 companies being charged with price-fixing to date (30 individuals and 7 companies having pleaded guilty with fines over $3 million).

All in all, the Interim Commissioner’s remarks today confirmed an ongoing increase in enforcement in key areas, particularly cartels, misleading advertising and abuse of dominance, with a few new points – notably an increased and more consistent use of section 11 orders and new guidelines relating to the price maintenance provisions of the Competition Act (under section 76) and relating to the Bureau’s Leniency Program (though the Interim Commissioner indicated that the new guidelines were coming in his remarks in December, 2012 in Vancouver).

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