February 14, 2013
In an interesting recent announcement made by the Federal Department of Justice, the DoJ announced that the Quebec Court of Appeal upheld the constitutionality of section 742.1 of the Criminal Code, which restricts the availability of conditional sentences (sometimes referred to as “house arrest”) for some serious personal injury offences.
The announcement, and Quebec appellate court decision, is also interesting in the regulatory law context because following legislative changes in 2012, the availability of conditional sentences (i.e., time served in the community) was further limited by amendments that came into force in November, 2012 to restrict such sentences from being imposed for some Competition Act offences, including conspiracy (under section 45 of the Act) and bid-rigging (under section 47 of the Act) (see: here and here).
Both of these Competition Act criminal offences carry potential maximum penalties that include 14 years imprisonment (the recent amendments restricting the availability of conditional sentences to, among other things, any offence for which the law prescribes a maximum penalty of 14 years or life imprisonment).
February 11, 2013
Earlier today, the Competition Bureau announced that the Federal Court of Appeal has dismissal the appeal from the Competition Tribunal’s decision in the CCS B.C. hazardous waste landfill merger case (see: here). In making the announcement, Canada’s Interim Commissioner of Competition John Pecman said:
“We are pleased that the Court has dismissed Tervita’s appeal with costs and upheld the Tribunal’s order. … If the acquisition had been allowed, Tervita would have been in a position to entrench its monopoly on secure hazardous waste disposal in Northeastern British Columbia.”
The Bureau initially filed an application with the Tribunal in 2011 to challenge this non-notifiable merger, arguing that the transaction, if it proceeded, would result in a substantial prevention of competition in the market for the disposal of hazardous waste in Northern British Columbia (the case was a “prevent” merger case).
The Competition Tribunal’s Decision
In May, 2012, the Tribunal ordered CCS to divest the Babkirk hazardous waste landfill assets acquired by CCS Corporation (now Tervita) from Complete Environmental. For a summary of the Tribunal’s decision last year see: Competition Tribunal Releases Decision in BC Landfill “Prevent” Merger Case.
In brief, on May 29, 2012, the Tribunal concluded that the acquisition by CCS of the shares of Complete substantially prevented competition and ordered CCS to divest Complete’s wholly-owned subsidiary Babkirk. The divestiture order was stayed pending appeal to the Federal Court of Appeal, which was heard last December. Tervita is the owner of the only operating secure landfills in North-Eastern British Columbia permitted to accept solid hazardous waste. These landfills primarily service oil and gas industry operators seeking to dispose of materials generated through drilling activities. Babkirk had secured regulatory approvals for development of a further secure hazardous waste landfill.
February 11, 2013
Thank you very much to Concurrences for short-listing one of my articles on Canadian bid-rigging for their upcoming 2013 Antitrust Writing Awards: Competition Bureau Jointly Lays 77 Charges Against 11 Individuals and 9 Companies in Quebec Bid-rigging Case – Tough Stance on Criminal Enforcement Continues. Concurrences short-lists articles in Academic and Business categories with voting and awards in April. From Concurrences:
“The Antitrust Writing Awards’ goal is to promote antitrust scholarship and competition advocacy by recognizing and awarding the best articles published in the antitrust law and law & economics fields in the last 12 months. The Awards feature two different categories of articles: Academic and Business. The Academic Articles category comprises articles published in academic journals, whereas the Business Articles category features articles published in professional magazines or newsletters. The articles are selected by a jury and by readers. The jury consists of a Board, an Academic and a Business Steering Committees composed of the leading academics and counsels. Readers contribute to the selection process by voting for articles. Click here to see the Jury. To ensure transparency, but also impartiality and expertise in the processing of the Awards, publications are assessed following an international peer-reviewed evaluation process. Members of the Board and of the Steering Committees are chosen from world-renowned antitrust enforcers, counsels and academics who are committed to judging the Awards fairly. The Institute of Competition Law – the publisher of the Journal Concurrences and the e-Competitions Bulletin – and George Washington University Law School Competition Law Center, are organizing these first of their kind Antitrust Writing Awards with the support of partners.”
For more information, copies of the articles, selection process or vote see: here and here.
February 10, 2013
On February 6, 2013, the Competition Bureau released its submission responding to the CRTC’s Wireless Code Working Document issued on January 28th. In its submission, the Bureau takes issue with two main aspects of the CRTC’s proposed approach to a new wireless code: potential switching costs for consumers (including plan lengths) and advocating for effective disclosure of key terms, particularly price and service limitations.
Consistent with recent enforcement, notably in the abuse of dominance area including in connection with its challenges against the Toronto Real Estate Board and Ontario hot water heater suppliers, the Bureau raises several potential switching cost concerns relating to long-term contracts, handset locking and excessive termination fees. Some of the potential adverse effects that, in the Bureau’s view, may flow from these wireless contract and handset features include reducing the incentive for incumbent carriers to innovate, raising rivals’ costs and acting as a barrier for new wireless entry.
Not surprisingly, and consistent with many Canadians, the Bureau takes particular issue with the fact that the contemplated code does not include any limit on the duration of wireless agreements. With respect to handset locking, the Bureau takes the position that device locking should be prohibited and that service providers should be required to unlock any previously locked devices free of charge. The Bureau also advocates for the uncoupling of current device subsidy contracts (i.e., for the financing of mobile devices over the life of a plan) from wireless service contracts generally, allowing consumers to continue with device financing agreements after switching to alternate providers.
February 8, 2013
It seems rather de rigueur at the moment for the Interim Commissioner of Competition to make the rounds of the big firms – in the latest stop on Mr. Pecman’s policy dance card, he stopped in Toronto yesterday to discuss in a bit more detail the Bureau’s current policies, enforcement focus and a few ongoing cases (see: Remarks by John Pecman). For other recent remarks by Mr. Pecman since he assumed the Interim Commissioner position last fall, see: here, here and here.
In this, the Interim Commissioner’s fourth speech since taking the post last fall, a few interesting points to note include a confirmation that the Bureau is interested in “incrementally increasing” its competition advocacy efforts (in addition to enforcement) in some key industries including the digital economy and retail and health sectors, re-stating the Bureau’s recent announcement that it would now use compulsory section 11 court orders in formal inquiries in all but exceptional cases (not voluntary information requests) and describing a loss in a Quebec court in one of its ongoing bid-rigging cases.
The Interim Commissioner also set out the following four factors the Bureau would consider in deciding whether to initiate regulatory interventions in particular sectors: (i) whether a forum exists and there is a high level of public interest, (ii) whether the Bureau would be contributing in a useful way (e.g., bringing forward unique arguments), (iii) being able to gauge the impact of advocacy efforts, and (iv) clear, tangible benefits for Canadians.
On the advertising and marketing law front, the Interim Commissioner also discussed the Ontario Court of Appeal decision upholding the lower court’s penalty finding in the recent Yellow Page Marketing case and the Bureau’s response filed in the CRTC’s wireless code consultations for mobile wireless providers.
All in all, while the Interim Commissioner reiterated previously announced policies, he also provided a bit more detail on the Bureau’s anticipated increase in advocacy / regulatory intervention efforts and further confirmed its continued focus on enforcement and key priorities, including the digital economy and mobile.
__________________
For more information about our regulatory services: contact
For more regulatory law updates follow us on Twitter: @CanadaAttorney
February 4, 2013
Tristan Jones over in the U.K. at Blackstone Chambers (Competition Bulletin) has written a very interesting note on recent U.K. competition/antitrust class action developments with comparisons to Canada and the U.S. Given that we are waiting for the Supreme Court of Canada’s indirect purchaser decision in Canada (heard last fall with a decision expected this spring) which, if decided adversely against the plaintiffs’ bar in Canada, may have significant adverse impacts on the competition class action bar in Canada, I thought this note rather timely and interesting. Tristan has kindly allowed me to reprint his note (and paper) here.
Collective Actions: Loss in Complex Cases
Tristan Jones (Blackstone Chambers)
The big news from last week’s UK announcement on reforming private competition enforcement is that the government plans to introduce opt-out class actions for competition claims.
The proposals incorporate various “safeguards” designed to ensure that the perceived excesses of US class actions do not become a problem here. Some of the safeguards are really no more than statements of the obvious – no-one can be surprised that we will not have US-style triple damages, or that law firms won’t be able to bring a claim without even having a claimant. On the other hand, some safeguards – such as the prohibition on contingency fees – will surely serve to limit the usefulness of UK class actions.
Financing aside, the big unanswered question is how attractive claimants will find such class actions (or “collective actions”, as the government prefers to call them, emphasising the differences with the US). The ideal competition class action would be a cartel between retailers, all imposing the same overcharge on their customers, all of whom are end consumers. Such a cartel would be a claimant lawyer’s dream – all of the consumers could be treated as a class, and the total overcharge could be calculated and distributed between those consumers.
Unfortunately life is often more complex. A good example of the problems of loss in complex cases is the US hydrogen peroxide litigation. The Court of Appeals for the Third Circuit quashed a class certification order because of the difficulty of showing injury on a class-wide basis. The defendants had argued (among other things) that the industry had changed significantly over the period of the cartel, that there was no empirical evidence suggesting that prices charged to individual customers moved in tandem, and that a number of contracts were individually negotiated.
The problems of individualised loss become even more pronounced if the calculation has to take account of indirect purchasers (“IPs”) as well as direct purchasers (“DPs”). In any case brought on behalf of IPs, the court will need to work out how much of the overcharge was passed on from the DP to the IP, and potentially from that IP further down the chain of increasingly remote IPs.
February 3, 2013
Do you need contest rules/precedents
for a Canadian contest?
We offer many types of Canadian contest/sweepstakes law precedents and forms (i.e., Canadian contest/sweepstakes law precedents to run common types of contests in Canada). These include precedents for random draw contests (i.e., where winners are chosen by random draw), skill contests (e.g., essay, photo or other types of contests where entrants submit content that is judged to enter the contest or for additional entries), trip contests and more. Also available are individual Canadian contest/sweepstakes precedents, including short rules (“mini-rules”), long rules, winner releases and a Canadian contest law checklist. For more information or to order, see: Canadian Contest Law Forms/Precedents. If you would like to discuss legal advice in relation to your contest or other promotion, contact us: Contact.
____________________
When running promotional contests in Canada, compliance tends to focus on the Competition Act, Criminal Code, privacy and ensuring that mandatory short rules and complete terms accurately reflect the promotion (and give maximum latitude to a contest promoter to take steps in the event an issue or contingency arises). While all of this is of course important and in many cases fairly straightforward, one aspect that can be overlooked is social media site rules (and another reason one size does not fit all in terms of contest rules and disclosure).
January 30, 2013
Given that I do a lot of work in the area of competition/antitrust law and trade and professional associations, this upcoming webinar being hosted by Strafford entitled Antitrust Pitfalls for Trade Associations and Members caught my eye.
While there are differences between the application of competition law to associations in Canada under the Competition Act and in the U.S. under the Sherman Act and state laws, many of the principles are the same. From Strafford:
“This CLE webinar will prepare counsel to and members of trade associations to minimize the risks of antitrust liability. The panel will explain recent guidance from the FTC and other federal agencies and outline clear antitrust compliance measures for associations and their members.
Successful antitrust suits can be catastrophic for businesses. Defendants may be liable for millions of dollars in civil forfeitures, triple damages to individual plaintiffs, enormous attorneys’ fees, and even criminal sanctions.
In trade associations, competitors communicate and collaborate. However, associations and members must avoid even the appearance of anticompetitive intent in all activities to ensure they don’t violate antitrust laws and regulations.
Recent cases offer critical guidance on antitrust compliance for trade associations and their members. Trade associations must have clear compliance programs to prevent conduct that would facilitate competitors coordinating on pricing or competition.
Listen as our panel of experienced antitrust practitioners examines the antitrust pitfalls for trade associations and their members, discusses lessons from recent anticompetitive conduct enforcement actions, and offers guidance for minimizing the risk of antitrust violation.”
Templates/precedents and checklists to run promotional contests in Canada
Templates/precedents and checklists to comply with Canadian anti-spam law (CASL)
