Archive for the 'News' Category
The National Competition Law Section of the Canadian Bar Association is holding its 2012 Spring competition law conference in Toronto (the 2012 Competition Law Spring Forum: Best Practices in a Time of Active Enforcement) on May 2, 2012 at the Toronto Board of Trade.
From the CBA:
“Aided by the 2009/10 changes to the Competition Act, the Canadian Competition Bureau has adopted an aggressive enforcement agenda. There are more litigated cases in the Tribunal and the Courts than ever before, including the first prosecution under the new conspiracy provisions of the Act. Commissioner Melanie Aitken has made it clear that there are more to come. Our expert panelists will provide guidance on effectively protecting your clients’ interests at all stages – from preventative compliance programs to responding to criminal or civil enforcement actions. We are delighted to announce that Commissioner Melanie Aitken will be our keynote lunchtime speaker.”
This year’s Spring conference will include panels on compliance, responding to Competition Bureau investigations, misleading advertising, developments in merger review and recent competition law developments (including the TREB abuse case, the contested Air Canada / United merger, Bell Canada advertising case and recent bid-rigging cases).
The A38 Journal of International Law has announced its second call for papers. From A38:
“The A38 Journal of International Law is a quarterly academic journal, published online, that seeks to provide an international forum for the publication of articles in the field of International Law. The Journal is currently soliciting submissions for Volume I, Issue 2, which will be published July 2012. The submission deadline for Issue 2 is May 31, 2012. We welcome submissions from academics, practitioners, students, researchers and experts from within the legal community. We have a strong preference for articles that are not descriptive, but that instead assert and defend a well-reasoned position.
The Canadian Council of Chief Executives recently published a paper endorsing a new national security test for proposed foreign takeovers of Canadian companies entitled “Chinese Foreign Direct Investment in Canada: Threat or Opportunity”.
According to the author, Dr. Moran, a professor of international business and finance at Georgetown University, the majority of proposed foreign acquisitions “pose no plausible threat whatsoever” to national security.
From the CCCE:
“In today’s report, Dr. Moran considers two issues of central interest to Canada as Chinese foreign direct investment (FDI) grows to be a major force in the global economy: how does Chinese FDI affect the structure of natural resource industries around the world?; and when does the foreign acquisition of an existing firm constitute a national security threat to that firm’s home country?
On the first question, Dr. Moran rejects the suggestion that Chinese investments in the natural resource sector have the effect of “locking up” the world’s resource base. On the contrary, a review of several dozen recent Chinese acquisitions and procurement arrangements shows that most of them actually help to expand and diversify resource production and increase competition within the affected industry.
As to whether a given foreign takeover poses a risk to national security, Dr. Moran recommends the adoption of a new threat-assessment framework based on three distinct categories of undesirable foreign acquisitions: takeovers that would render the home country dependent on a foreign-controlled supplier that might deny or place limits on the provision of goods or services crucial to the functioning of the home economy; takeovers that would allow the transfer into foreign hands of technology or expertise that might be deployed in a manner harmful to the home country’s interests; takeovers that would give the new owner’s government, or some other hostile force, a platform for espionage, surveillance or sabotage, through the provision of goods or services crucial to the functioning of the home economy.
Acquisitions that fall into any of those three categories can legitimately be rejected on national security grounds, Dr. Moran says. However, that accounts for only a small percentage of proposed foreign takeovers. The rest, he says, may or may not deserve to be blocked on other grounds, but cannot fairly be considered threats to national security.
The adoption of this three-part threat assessment framework by Canada – and other countries – would “help to dampen politicization of individual cases, enabling swift and confident approval of those acquisitions from which genuine national security threats are absent,” Dr. Moran says. The entire international economic system would benefit, he argues, if OECD countries – and non-OECD countries such as China and India – were to accept this common threat assessment methodology.”
In March, 2009, amendments to the Canadian Investment Canada Act (“ICA”) introduced a new national security review mechanism, under which the Minister and Federal Cabinet have the power to review proposed or completed investments that may be “injurious to national security” in Canada. This relatively new national security review regime, which is distinct and administered separately from the general “net benefit” to Canada foreign investment test under the ICA, arose as a result of recommendations made by the Competition Policy Review Panel in its report entitled Compete to Win (which preceded significant amendments to Canada’s competition and foreign investment laws in 2009 and 2010).
The Ottawa Citizen, Globe and Mail and others have reported that the federal government, based on a recommendation of Heritage Minister James Moore, made a rather uncommon Cabinet order on March 27th under section 15 of the Investment Canada Act (“ICA”) triggering a cultural review of Target’s planned expansion into Canada.
The Cabinet order issued on March 27th states:
“His Excellency the Governor General in Council, considering it in the public interest, on the recommendation of the Minister of Canadian Heritage, pursuant to section 15 of the Investment Canada Act, hereby orders that the investment by Target Canada Co. to establish a new Canadian business carried on by Target be reviewed.”
Generally speaking, the ICA applies where a “non-Canadian” acquires “control” of a “Canadian business”, all as defined in the ICA (or establishes a new Canadian business, in the case of the Target expansion into Canada).
Where transactions to acquire control of a Canadian business exceed the relevant monetary thresholds under the ICA (currently Cdn. $330 million based on the book value of the target for direct investments by WTO investors), they are reviewable by Investment Canada and potentially also by Canadian Heritage if a cultural business is involved (or, if below the relevant monetary thresholds set out in the ICA, subject to a simple notification only, which are generally filed post-closing). Interestingly, there is no de minimis test for what constitutes a cultural business for the purposes of the ICA.
For investments by non-Canadians to establish a new Canadian business, as in the case of Target, a notification only is required, which may be filed any time up to completion or within 30 days post-completion. Such notifications require, among other things, the investor to provide basic information regarding the investor, the investment and type of Canadian business being established (including a description of whether the proposed investment relates to Canadian cultural business activities, such as the publication or sale of books, the production, distribution or sale of film of video, or the publication, distribution or sale of music).
The American Bar Association, Section of Antitrust Law has published its Spring 2012 edition of Antitrust.
Stories and articles in the Spring edition include Convergence in International Merger Control (Larry Fullerton and Megan Alvarez), The ICN: A Decennial Retrospective (Ian John and Joshua Gray), the Role of Anti-Cartel Compliance Programs in Preventing Cartel Behaviour (Joseph Murray and William Kolasky), The Year of the Metal Rabbit: Antitrust Enforcement in China (Jim O’Connell) in 2011 and New Directions in Russian Competition Law (Sarah Reynolds).
On April 5, 2012, the U.S. DoJ published a rather interesting speech by the Deputy Assistant Attorney General of the U.S. DoJ, Antitrust Division, Fiona Scott-Morton, entitled “Contracts that Reference Rivals”.
The speech addresses one very specific and interesting aspect of vertical arrangements – namely when antitrust enforcement officials should scrutinize supply and other vertical contracts that reference and depend on information outside the buyer-seller relationship (e.g., competitor information):
“Consider first a contract between firms over the purchase of an input. Some contracts lay out a price per unit which the buyer must pay; others describe a quantity volume schedule open to all buyers, with one per-unit price for purchase of a limited number of units and a, typically lower, per-unit price for purchases of large numbers of units. I will call these standard contracts, and they are the benchmark I have in mind. By contrast, a contract between a buyer and a seller may refer to, and its terms may depend on, information outside the buyer-seller relationship: information from other transactions to which those same firms are party. Those references may be either explicit or implicit, and they can involve a host of factors, including price terms, non-price terms, terms pertaining to the buyer’s rivals, or terms pertaining to the seller’s rivals. I call these Contracts that Reference Rivals, or CRR.
An example of CRR is a purchase agreement containing a market share discount: the buyer will receive a discount on incremental units, or perhaps all purchased units, if it buys 90% or more of its needs from one seller. Note that the price the buyer pays on its purchases from one seller are linked to its purchases at rival sellers. Buying more than 10% of its needs from the rival sellers will increase the price paid in the contract.
Over the years, a number of investigations at the Antitrust Division have involved contracts that reference other transactions in the marketplace. Likewise, economists have studied many types of CRRs. The goal of this paper is to provide a brief survey of past and current CRR cases as well as the findings in the economic literature. The short preview of my conclusions is that the economics literature has identified many circumstances where CRRs have the potential to harm consumers and competition, particularly — but not always — when they involve firms with market power. CRRs have thus been, and will continue to be, the subject of antitrust scrutiny, both at the government and in private litigation.”
On April 4, 2012, the federal CRTC announced that it was calling for public comments on the state of competition in the Canadian wireless sector to decide whether to develop a national code for wireless services (see: CRTC seeks views on the state of competition in the Canadian wireless sector).
In making the announcement, the CRTC said:
“Today, the Canadian Radio-television and Telecommunications Commission (CRTC) announced that it is seeking views on whether the wireless market has changed enough to warrant its intervention in the development of a national code for wireless services. The CRTC recently received several applications suggesting that one be established.
In 1994, the CRTC decided it would not regulate the wireless sector. It was convinced that there was enough competition in the marketplace to guide the industry’s growth and provide Canadian consumers with a choice of innovative services.”
Comments can be submitted online at: Telecom Proceedings Open for Comment.
Earlier this week, the federal CRTC announced that it has taken sweeping enforcement steps against 85 companies for breaching Canada’s telemarketing rules.
In making the announcement, the CRTC said:
“Today, the Canadian Radio-television and Telecommunications Commission (CRTC) concluded a five-month investigation and took enforcement action against 85 companies for breaking the telemarketing rules. This investigation marks the latest step in the CRTC’s efforts, using a variety of enforcement strategies, to reduce unwanted calls made to Canadians.
The CRTC issued citations to 74 telemarketers who had failed to register with the National Do Not Call List operator or subscribe to the National Do Not Call List. Notices of violation were issued to an additional 11 companies for more significant breaches. Administrative monetary penalties totalling $41,000 were imposed on those 11 companies. In setting the penalty amounts, the CRTC recognized that many of these telemarketers are small businesses.”
According to the CRTC, it has imposed penalties of $2.1 million to date.
Under Canada’s National Do Not Call List (“DNCL”) rules, established under the federal Telecommunications Act, consumers may register their residential, wireless, fax or VoIP telephone numbers to reduce the number of telemarketing calls received. Registrations are valid for five years and become effective 31 days after registration (consumers must periodically renew their registrations before expiry).
Templates/precedents and checklists to run promotional contests in Canada
Templates/precedents and checklists to comply with Canadian anti-spam law (CASL)
