Competitor Collaboration Guidelines: Competition Bureau Updates Key Guidance

• Published date: 30 June 2021
• Subject Matter: Corporate/Commercial Law, Anti-trust/Competition Law, M&A/Private Equity, Antitrust, EU Competition , Cartels, Monopolies
• Law Firm: McMillan LLP
• Author: Mr William Wu, James B. Musgrove and Éric Vallières

On May 6, 2021, the Competition Bureau (the "Bureau") released updates to its Competitor Collaboration Guidelines (the "CCGs"). The revised CCGs can be found here.

Background

The CCGs are a "big deal". The Competition Bureau puts out a significant volume of guidance, addressing various matters respecting its enforcement approach under the Competition Act (the "Act"). Virtually all guidance from the Bureau is welcome, but not all is of equal importance. The CCGs are right at the top of the importance hierarchy. One reason is that competitor collaboration - in some cases price fixing or cartel conduct - can involve the most serious competition offences. Consequently, the CCGs are of great interest for businesses seeking to collaborate, legitimately, with competitors while avoiding serious competition law offences.

The other reason is that there is limited judicial guidance on this very important topic. The Canadian law was changed very significantly in 2010, to create per se offences with respect to certain types of agreements between competitors (essentially price fixing, market allocation and output restriction agreements), and to remove other types of agreements (such as vertical arrangements) from the ambit of the criminal law. The amendments also created a specific, but not entirely clear, statutory defence to the criminal provisions for some types of joint venture arrangements between competitors. Finally, the 2010 amendments added a new provision (section 90.1) which allows civil challenge to other types of agreements between competitors.

Even the brief overview above demonstrates the complexity of the 2010 Competition Act amendments. There has been very limited jurisprudence since their introduction to provide interpretation.¹ Therefore, guidance respecting the Bureau's views in this area is particularly valuable. This Bulletin does not summarize the full content of the CCGs. It focuses on the significant changes from the original version published in 2009.

Implications for Mergers

(i) Agreements going beyond a pure merger

The updated CCGs stipulate that where parties to a merger enter into an agreement that goes beyond the pure merger arrangement, the Bureau may consider whether it should commence a potential criminal investigation with respect to those aspects of the transaction which go beyond the merger proper. In this regard, the updated CCGs added the following new language:

Where parties enter into any agreement(s) that goes beyond the acquisition, amalgamation or combination agreement, whether within or outside said agreement, the Bureau will consider under which provision(s) of the Act any investigation or inquiry should be pursued. The Bureau may utilize its formal powers under...