On April 12, 2012, the Competition Bureau published a new Merger Review Performance Report. The Bureau’s new Report contains a summary of updated and newly issued merger-related guidelines, statistics relating to its review of mergers in the past two years (since its last merger performance report was issued in 2010) and discussions of recent initiatives and policy changes.
Some of the highlights of the Bureau’s new Report include:
Merger-review related policy objectives. The Bureau describes its new and updated merger guidelines as part of its “ongoing initiative to realign its processes, and to develop and revise its guidance documents to ensure the successful implementation of the 2009 amendments to the merger provisions of the Act and the Notifiable Transactions Regulations.” The Bureau’s new or recently updated merger-related guidelines include its Fees and Service Standards Policy for Mergers and Merger-Related Matters, Fees and Service Standards Handbook for Mergers and Merger-Related Matters, Procedures Guide for Notifiable Transactions and Advance Ruling Certificates under the Competition Act, several new Merger Interpretation Guidelines (including in relation to hostile transactions), updated Merger Enforcement Guidelines (which govern the Bureau’s substantive review of mergers), Merger Review Process Guidelines (which address the Bureau’s approach to Canada’s new two-stage merger review regime, include second phase reviews and the use of supplementary information requests (“SIRs”)).
New standard language for “no action” letters. The Bureau discusses its new standard language for “no action” letters to align its clearance language to section 123(2) of the Competition Act and “more accurately reflect the distinction between the discretionary issuance of an ARC and [a no action letter]”.
New merger remedies bulletin. The Bureau has announced, consistent with recent public remarks by the Commissioner, that it intends to update its 2007 Merger Remedies Bulletin “in the coming months” based on its August, 2011 Merger Remedies Study.
Merger position statements. The Bureau discusses its recent initiative to begin issuing position statements for certain merger reviews to “enhance its communication and transparency with stakeholders”. The Bureau also discusses some of the factors it will consider in deciding whether to issue a position statement, including the complexity and importance of issues, involvement of novel analytical tools and level of interest in the case.
Merger registry. The Bureau discusses its recently launched (in February of this year) merger register.
Merger review statistics. The Bureau’s Report includes merger review statistics, including a significant drop in reviews (a decrease of about 100 reviewed mergers between FY2007-2008 and FY2008-2009, the “biggest decline in a single fiscal year since the introduction of filing fees in 1997), the impact of filings following the increase in the size of transaction threshold in 2009 (from C $50 to $70 million at the time – the size-of-transaction threshold is currently C $77 million), a “steady influx of highly complex transactions raising serious competition concerns” (including the BHP/Potash, LSE/TMX, TMX/Maple Group and Google/Motorola transactions) and the issuance of 18 SIRs since the introduction of Canada’s two-stage merger review regime in 2009.
Review of non-notifiable mergers. The Bureau discusses its relatively recent initiative to increase its monitoring and review of non-notifiable transactions (in Canada, all mergers as defined under the Competition Act are potentially reviewable regardless of whether they require pre-merger notification). In this regard, the Bureau states that it “recently implemented a new initiative to actively monitor transactions in the Canadian marketplace”. According to the Bureau, this shift in its policy was largely driven by the reduced timeframe to challenge mergers post-closing as a result of the 2009 amendments (reduced to one year from the previous three). The Bureau states that its monitoring of non-notifiable deals includes “regular scanning of various media sources and mergers and acquisition databases, as well as the review of relevant marketplace complaints received by the Bureau.”
For more about Canada’s merger control and foreign investment review regimes see:
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