July 14, 2022
On June 23, 2022, Bill C-19 (the Budget Implementation Act, 2022, No.1) received royal assent, introducing sweeping amendments to Canada’s federal Competition Act.
These amendments include significant increases to the civil and criminal penalties under the Competition Act, new criminal and civil prohibitions on drip pricing under sections 52 and 74.01 and broad amendments to expand the abuse of dominance provisions under section 79 of the Competition Act, including to allow private right of access to the Competition Tribunal and increased penalties.
The amendments also include new wage fixing and no-poaching agreement offences under section 45 of the Competition Act (criminal conspiracy agreements).
These initial Competition Act amendments (a second round of amendments is anticipated including potential changes to Canada’s mergers efficiency defence) follow the Competition Bureau’s submission on Examining the Competition Act in the Digital Era on February 8, 2022 and mark the most significant amendments to the Competition Act since 2009.
For more information about the 2022 Competition Act amendments, see: Sweeping Canadian Competition Act Amendments Passed.
New Wage Fixing and No-Poach
Agreement Conspiracy Offences
Under the recent 2022 Competition Act amendments, the criminal conspiracy (cartel) provisions of the Competition Act (section 45) will be expanded to prohibit agreements between employers to fix employee wages (wage fixing agreements) or to agree not to solicit or hire employees (no-poaching agreements).
These amendments are consistent with labour market enforcement practices and policy change commitments in the European Union and the United States and was seen as a gap in Canadian conspiracy/cartel law.
In this regard, in several decisions, Canadian courts had held that the current conspiracy provisions of the Competition Act (section 45) did not include so called “upstream” or “buy-side” agreements and only applied to conspiracies/cartels between competing suppliers of products (i.e., to conspiracies in relation to downstream markets).
These new wage fixing and no-poach conspiracy offences will come into force on June 23, 2023 after a one-year transition period to allow employers to adjust to the changes.
For more information on recent enforcement activity in relation to no-poach and wage-fixing agreements, see Competition Bureau, Competition Bureau statement on the application of the Competition Act to no-poaching, wage-fixing and other buy-side agreements and Competition Bureau Reiterates Narrow Enforcement Position For No-Poaching and Wage-Fixing Agreements Between Competing Employers.
For more information about the criminal conspiracy offences under section 45 of the Competition Act, see: Conspiracy (Cartels) and Competition Law Enforcement.
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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, 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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For more information about our firm, visit our website: Competitionlawyer.ca
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