Archive for the 'News' Category
The Criminal Matters Committee of the Canadian Bar Association’s Competition Law Section will be offering a webinar on cartel enforcement in smaller jurisdictions with the ABA’s Section of International Law on November 6, 2012. From the CBA:
“Cartel enforcement in smaller economies can involve unique issues, including as a result of relatively thin markets that accommodate fewer players of appreciable scale and the existence of industrial policies and business cultures that may clash with competition law principles. In addition, leniency-driven cartel enforcement in relation to alleged international cartel conduct can raise challenging issues for competition agencies and investigated parties alike, especially outside the United States and European Union, where leniency applicants (and investigated parties) are incentivised to concentrate their efforts.
Register for this teleseminar to hear how enforcement officials in Canada, Ireland, New Zealand and Israel are tackling a variety of issues in cartel enforcement, including: drafting anti-cartel laws that clearly distinguish between unlawful cartels and beneficial, efficiency-enhancing, competitor collaborations; working with corporations and government to promote a culture of compliance; drafting and administering effective leniency programs that account for and mitigate parties’ natural pre-occupation with ‘primary’ competition jurisdictions; leveraging international networks and cooperation with other competition agencies; accessing evidence and witnesses in foreign countries; establishing jurisdiction over alleged cartel conduct originating abroad; avoiding resource fatigue from foreign leniency applications and maintaining a credible enforcement program targeting domestic cartels; building a strong enforcement culture and obtaining precedent-setting sanctions in the face of penalties and class action suits for the same conduct in other jurisdictions.”
I am pleased to be delivering two upcoming competition law compliance courses (Competition Law and REALTORS®) for the members of the Kamloops (November 26th) and Victoria (November 29th) real estate boards.
The compliance seminars will include overviews of Canadian competition law enforcement, the Competition Bureau, the conspiracy, misleading advertising, price maintenance and abuse of dominance provisions of the Competition Act and practical real estate related case studies.
Competition Law and REALTORS®: What You Say and Do Matters is a national competition law compliance course designed by the Alliance for Canadian Real Estate Education with the assistance of The Canadian Real Estate Association to help Canadian REALTORS® understand and comply with Canadian competition law. While Canadian competition law applies to all real estate professionals, this course was designed specifically for REALTORS®. This course provides an overview in plain language of Canadian competition law and practical compliance guidelines to assist REALTORS® in complying with Canadian competition law and a number of illustrative case studies.
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For more information about our regulatory law services contact us: contact
For more regulatory law updates follow us on Twitter: @CanadaAttorney
Conventional thinking has been that the most serious consumer protection enforcement tends to be under federal law (e.g., the Competition Act or Criminal Code). That reasoning changed somewhat last week with an Oakville company being found guilty by a Newmarket Ontario court of violating the Ontario Consumer Protection Act (the “CPA”), fined $250,000, ordered to pay more than $100,000 in restitution to customers with the firm’s director also sentenced to six months in jail. These are the most significant penalties ever imposed against a business under the CPA.
The Oakville heating and cooling company and its director had been charged with 21 violations of the CPA. In making the announcement, Ontario’s Ministry of Consumer Services said:
“It had been alleged that between March and November 2008, Mr. Preston and his company misled consumers in Markham, Stouffville, Toronto and Mississauga by providing contracts and accepting payments for services and products he knew his failing company would be unable to provide. Heating and cooling systems that were supplied malfunctioned shortly after installation and consumers were not given refunds when contracts were cancelled.”
The CPA governs many common types of consumer transactions in Ontario and regulates, among other things, consumer agreements (including future performance, time share, Internet, distance and direct sales agreements), certain types of misleading claims and some specific sectors (including auto repair, credit and leasing).
In the most noteworthy Canadian competition/antitrust law development today, the Competition Bureau announced that a settlement (consent agreement) had been reached in this case, one of two contested mergers in the past few years in Canada (together with the recent CCS hazardous landfill case which was recently decided by the Competition Tribunal and is currently on appeal).
This case, which was to scheduled to be heard in early November before the Competition Tribunal (see: here and here) was noteworthy for being one of only two contested mergers currently underway in Canada and for representing the first challenge, if it had proceeded, of agreements (in this case joint venture agreements between Air Canada and Continental) under Canada’s recently enacted civil agreements provision of the Competition Act (section 90.1 – which, together with section 45, comprises Canada’s new two-track conspiracy/cartel regime).
The Bureau had been challenging three existing Air Canada / Continental “coordination agreements” under section 90.1 of the Competition Act, under which the Bureau can apply to the Competition Tribunal for remedial orders where agreements between competitors prevent or lessen (or are likely to prevent or lessen) competition substantially in one or more relevant markets.
There has not yet been a contested section 90.1 case since this new “civil agreements” provision came into force (which is thought may apply to a range of commercial agreements that, while they may not constitute “hard core” cartel type agreements under section 45 of the Act – i.e., price-fixing, market division/allocation and output restriction agreements – may nevertheless prevent or lessen competition substantially in some cases).
While it is thought that the new section 90.1 may apply, in some instances, to joint venture, franchise, licensing, information exchange and research and development agreements, among others, where competition is substantially impacted, the boundaries of section 90.1 now remain as yet unknown and untested.
“In the 2002 film Minority Report, Steven Spielberg imagined a world in which companies use biometric technology to identify us and serve us targeted ads. Ten years later, that vision is coming closer to reality. Having overcome the high costs and poor accuracy that once stunted its growth, one form of biometric technology – facial recognition – is quickly moving out of the realm of science fiction and into the commercial marketplace.
Today, companies are deploying facial recognition technologies in a wide array of contexts, reflecting a spectrum of increasing technological sophistication. At the simplest level, the technology can be used for facial detection; that is, merely to detect and locate a face in a photo. Current uses of facial detection include refining search engine results to include only those results that contain a face; locating faces in images in order to blur them; ensuring that the frame for a video chat feed actually includes a face; or developing virtual eyeglass fitting systems and virtual makeover tools that allow consumers to upload their photos online and “try on” a pair of glasses or a new hairstyle.”
(U.S. Federal Trade Commission, Report,
Facing Facts: Best Practices for Common Uses of Facial Recognition Technologies)
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For those who have seen the Tom Cruise film Minority Report, you will surely remember the scene where Tom Cruise cruises through Gap and gets targeted ads directed at him. I can’t quite recall if this was an accelerated version of geo targeted advertising or facial recognition (or be sure that I could decode the technology in any event).
In any event, that was the first thing that came to mind when I saw that the U.S. Federal Trade Commission has just published a new staff report yesterday on advertising and privacy issues connected to facial recognition technologies – called: Facing Facts: Best Practices for Common Uses of Facial Recognition Technologies – and sure enough the lead-in to the report describes facial recognition technology, like that depicted in Minority Report, becoming a reality.
In issuing the new report, the FTC said:
“The Federal Trade Commission today released a staff report “Facing Facts: Best Practices for Common Uses of Facial Recognition Technologies” for the increasing number of companies using facial recognition technologies, to help them protect consumers’ privacy as they use the technologies to create innovative new commercial products and services.
Facial recognition technologies have been adopted in a variety of contexts, ranging from online social networks and mobile apps to digital signs, the FTC staff report states. They have a number of potential uses, such as determining an individual’s age range and gender in order to deliver targeted advertising; assessing viewers’ emotions to see if they are engaged in a video game or a movie; or matching faces and identifying anonymous individuals in images.
Facial recognition also has raised a variety of privacy concerns because – for example – it holds the prospect of identifying anonymous individuals in public, and because the data collected may be susceptible to security breaches and hacking.”
The FTC’s new report makes a number of recommendations for companies utilizing facial recognition technologies for advertising including designing services with consumer privacy in mind; developing reasonable security protections for information collected (and policies for determining what information to keep and discard); and evaluating the sensitivity of information when developing facial recognition related products (e.g., digital signs that use facial recognition technology is recommended not to be set up in places where children may be targeted).
The report also makes a number of other recommendations, including in relation to notice, disclosure (i.e., what data will be collected and how it will be used), choice to participate (or opt out) and affirmative consent in some cases.
Last week the CRTC announced that it was denying BCE’s proposed acquisition of Astral, late Friday night the Federal Government announced that it was opposing Petronas’ proposed acquisition of Progress Energy, then late this afternoon, as anticipated, BCE announced it was asking the Federal Cabinet to issue a policy direction under the Broadcasting Act directing the CRTC to follow its policies for change of control broadcasting transactions. In making its announcement BCE said:
“In rejecting the Astral transaction the CRTC rejected its own established policies, creating serious regulatory uncertainty in Canada’s vital broadcasting sector … We’re requesting that Cabinet provide the required guidance to the CRTC to follow its own rules in place, with which the Astral-Bell transaction fully complied.”
Canadian and international firms, it seems, are growing restless with the Federal Government and regulatory agencies determining which deals clear and which are blocked, and related tests (in one instance net benefit to Canada the other a public interest test).
On the other hand, these recent transactions raise important questions about the appropriate factors that should underlie acquisitions of major broadcasting undertakings by market leaders and significant investments in Canada by foreign governments. These include market and consumer effects, choice, security issues and the level of real reciprocal investment. Canadian shareholders and funds want payouts and the free movement of capital and confidence in Canadian capital markets are all highly legitimate concerns, but these decisions have shown (through public opinion and, in the case of the BCE/Astral transaction, through extensive public hearings) that the ability to move capital is not the only concern to Canadians.
In the case of the BCE/Astral deal, one of BCE’s primary arguments has been that it needs scale and size to better compete with global rivals. But what of Canadian consumers facing less competition yet in one of the most concentrated media markets in the world? The CRTC’s Chairman stated during the public hearings that he had spent his summer holiday reading negative comments about the proposed BCE/Astral transaction. Should negative (and allegedly biased and partisan) comments trump CRTC policy?
Of course, more oversight could cure market power concerns (like the OSC’s promised regulation of Canada’s leading securities exchange).
Advertising Standards Canada (ASC) will be hosting two upcoming seminars on privacy in Toronto and Montreal entitled “The Truth About Privacy: Canada and Beyond”. According to the ASC, the seminars are based on a recent McCann study on how Canadian and worldwide consumers think about privacy.
From the ASC:
“In a transparent world where virtually all aspects of our lives have become digitized, the question of personal privacy keeps arising. What do consumers really think about privacy? To find out, McCann Truth Central asked over 6,000 people worldwide what privacy means to them. With ASC’s support, McCann has now extended its research to include 1,000 Canadians. In this ground-breaking study, McCann probed many areas, including: where do people draw the line between public and private information?; when do consumers feel their privacy has been violated?; what motivates consumers to share their data?; how do Canadian perceptions of privacy stack up against the rest of the world?; how can advertisers manage data as an opportunity and not a risk? Join us as Laura Simpson and David Tucker from McCann Truth Central, McCann’s global thought leadership unit, share the extraordinary insights gleaned from this important study. ASC will also provide an update on our industry’s new self-regulatory framework for online behavioural advertising and the launch of the Digital Advertising Association of Canada.”
“Is everything sacred in Canada? At first it was a hole in the ground. Then it was the stock exchange and a DIY chain. This week, regulators blocked two more big deals, including a $5.2 billion bid for Progress Energy by Petronas of Malaysia. Taken as a whole, these actions signal the market for corporate control in Canada – especially when it comes to foreign buyers – is effectively closed.”
(Slate)
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“Sources say Ottawa asked Petronas at the eleventh-hour for a delay to rule on its bid to take over Progress until Dec. 7, so it can finalize its new policy. Industry Canada, which is reviewing the transaction, had already delayed its decision once and had promised to produce a ruling by Friday.”
(Financial Post)
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“The lack of transparency is starting to reach new heights. Who releases such an important decision at midnight on a Friday? Someone who has something to hide and no way to explain.”
(NDP leader Thomas Mulcair)
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In a week of surprises that included the CRTC denying BCE’s BCE’s acquisition of Astral, late on Friday night the Minister of Industry announced that he was not satisfied that Petronas’ proposed acquisition of Progress Energy Resources was likely to be of net benefit to Canada:
“I can confirm that I have sent a notice letter to Petronas indicating that I am not satisfied that the proposed investment is likely to be of net benefit to Canada. I came to this decision after a careful and thorough review of the proposed transaction. Under the Investment Canada Act, Petronas now has up to 30 days to make any additional representations and submit any further undertakings, which can be extended with my agreement and that of the investor. Subsequently, I will either confirm this initial decision or approve the acquisition.”
While the Minister reiterated similar earlier statements by the Prime Minister and other Government officials that Canada remained open to investment (saying that the Government remained “committed to maintaining an open climate for investment”), this decision casts those statements further in doubt and, while statistically absolutely true, raises again the question of the applicable rules investors and in particular SOEs must meet.
On Sunday, on CTV’s Question Period, Canada’s Finance Minister Jim Flaherty also said that Canada “welcomes foreign direct investment” but that Petronas type bids must ultimately be “correct”.
The Petronas/Progress deal had received some, but by no means as much, attention as the pending CNOOC/Nexen deal, which has recently been extended until November to allow for a national security review.
According to media reports, Petronas refused the Government’s request for more time to review its proposed bid to acquire Progress, had grown frustrated with negotiations attempting to satisfy the Investment Canada Act’s (ICA) net benefit to Canada test and according to media sources was getting little Government input on required commitments. On October 5th the initial ICA review period had been extended (see: here).
The Minister has an initial 45 days to review proposed investments under the Investment Canada Act, which can be unilaterally extended another 30 days (with further extensions with consent of an investor). Where an investment is opposed, investors may make further submissions in an attempt to clear a transaction with further undertakings.
In a brief news release issued by Progress on Saturday, it said:
“The Board of Directors, management and employees of Progress are disappointed in the announcement. ‘Progress will be working over the next 30 days to determine the nature of the issues and the potential remedies’ said Michael Culbert, President and Chief Executive Officer of Progress. ‘The long-term health of the natural gas industry in Canada and the development of a new LNG export industry are dependent on international investments such as PETRONAS’”.
This decision is rather surprising, although it is always difficult to predict whether transactions will receive ICA clearance based on the opaque political nature of the ICA net benefit criteria and fact-specific nature of every transaction and related undertakings.
State-owned enterprises are subject to an additional layer of review in Canada under Investment Canada’s SOE Guidelines that set out additional factors (relating to the corporate governance and commercial orientation of the SOE) in addition to the general net benefit to Canada factors in section 20 of the ICA. SOEs may also be required, as is being illustrated in this case, to provide more stringent undertakings than private investors – for example, undertakings for the complete duration of a proposed investment.
Templates/precedents and checklists to run promotional contests in Canada
Templates/precedents and checklists to comply with Canadian anti-spam law (CASL)
