Competition Act (R.S.C., 1985, c. C-34)

Marginal note:Unpaid monetary penalty

79.1 The amount of an administrative monetary penalty imposed on a person under subsection 79(3.1) is a debt due to Her Majesty in right of Canada and may be recovered as such from that person in a court of competent jurisdiction.

Delivered Pricing

Marginal note:Definition of delivered pricing

• 80 (1) For the purposes of section 81, delivered pricing means the practice of refusing a customer, or a person seeking to become a customer, delivery of an article at any place in which the supplier engages in a practice of making delivery of the article to any other of the supplier’s customers on the same trade terms that would be available to the first-mentioned customer if his place of business were located in that place.

• Marginal note:Definition of trade terms

  (2) For the purposes of subsection (1), the expression trade terms means terms in respect of payment, units of purchase and reasonable technical and servicing requirements.

Marginal note:Delivered pricing

• 81 (1) Where, on application by the Commissioner, the Tribunal finds that delivered pricing is engaged in by a major supplier of an article in a market or is widespread in a market with the result that a customer, or a person seeking to become a customer, is denied an advantage that would otherwise be available to him in the market, the Tribunal may make an order prohibiting all or any of such suppliers from engaging in delivered pricing.

• Marginal note:Exception where significant capital investment needed

  (2) No order shall be made against a supplier under this section where the Tribunal finds that the supplier could not accommodate any additional customers at a locality without making significant capital investment at that locality.

• Marginal note:Exception where trademark used

  (3) No order shall be made against a supplier under this section in respect of a practice of refusing a customer delivery of an article that the customer sells in association with a trademark that the supplier owns or in respect of which the supplier is a registered user where the Tribunal finds that the practice is necessary to maintain a standard of quality in respect of the article.

Foreign Judgments and Laws

Marginal note:Foreign judgments, etc.

82 Where, on application by the Commissioner, the Tribunal finds that

• (a) a judgment, decree, order or other process given, made or issued by or out of a court or other body in a country other than Canada can be implemented in whole or in part by persons in Canada, by companies incorporated by or pursuant to an Act of Parliament or of the legislature of a province, or by measures taken in Canada, and

• (b) the implementation in whole or in part of the judgment, decree, order or other process in Canada, would

  • (i) adversely affect competition in Canada,

  • (ii) adversely affect the efficiency of trade or industry in Canada without bringing about or increasing in Canada competition that would restore or improve that efficiency,

  • (iii) adversely affect the foreign trade of Canada without compensating advantages, or

  • (iv) otherwise restrain or injure trade or commerce in Canada without compensating advantages,

  the Tribunal may, by order, direct that

• (c) no measures be taken in Canada to implement the judgment, decree, order or process, or

• (d) no measures be taken in Canada to implement the judgment, decree, order or process except in such manner as the Tribunal prescribes for the purpose of avoiding an effect referred to in subparagraphs (b)(i) to (iv).

Marginal note:Foreign laws and directives

• 83 (1) Where, on application by the Commissioner, the Tribunal finds that a decision has been or is about to be made by a person in Canada or a company incorporated by or pursuant to an Act of Parliament or of the legislature of a province

  • (a) as a result of

    • (i) a law in force in a country other than Canada, or

    • (ii) a directive, instruction, intimation of policy or other communication to that person or company or to any other person from

      • (A) the government of a country other than Canada or of any political subdivision thereof that is in a position to direct or influence the policies of that person or company, or

      • (B) a person in a country other than Canada who is in a position to direct or influence the policies of that person or company,

      where the communication is for the purpose of giving effect to a law in force in a country other than Canada,

    and that the decision, if implemented, would have or would be likely to have any of the effects mentioned in subparagraphs 82(b)(i) to (iv), or

  • (b) as a result of a directive, instruction, intimation of policy or other communication to that person or company or to any other person, from a person in a country other than Canada who is in a position to direct or influence the policies of that person or company, where the communication is for the purpose of giving effect to a conspiracy, combination, agreement or arrangement entered into outside Canada that, if entered into in Canada, would have been in contravention of section 45,

  the Tribunal may, by order, direct that

  • (c) in a case described in paragraph (a) or (b), no measures be taken by the person or company in Canada to implement the law, directive, instruction, intimation of policy or other communication, or

  • (d) in a case described in paragraph (a), no measures be taken by the person or company in Canada to implement the law, directive, instruction, intimation of policy or other communication except in such manner as the Tribunal prescribes for the purpose of avoiding an effect referred to in subparagraphs 82(b)(i) to (iv).

• Marginal note:Limitation

  (2) No application may be made by the Commissioner for an order under this section against a particular company where proceedings have been commenced under section 46 against that company based on the same or substantially the same facts as would be alleged in the application.

Foreign Suppliers

Marginal note:Refusal to supply by foreign supplier

84 Where, on application by the Commissioner, the Tribunal finds that a supplier outside Canada has refused to supply a product or otherwise discriminated in the supply of a product to a person in Canada (the “first” person) at the instance of and by reason of the exertion of buying power outside Canada by another person, the Tribunal may order any person in Canada (the “second” person) by whom or on whose behalf or for whose benefit the buying power was exerted

• (a) to sell any such product of the supplier that the second person has obtained or obtains to the first person at the laid-down cost in Canada to the second person of the product and on the same terms and conditions as the second person obtained or obtains from the supplier; or

• (b) not to deal or to cease to deal, in Canada, in that product of the supplier.

Specialization Agreements

Marginal note:Definitions

85 For the purposes of this section and sections 86 to 90,

article

article includes each separate type, size, weight and quality in which an article, within the meaning assigned by section 2, is produced; (article)

registered

registered means registered in the register maintained pursuant to section 89; (inscrit)

specialization agreement

specialization agreement means an agreement under which each party thereto agrees to discontinue producing an article or service that he is engaged in producing at the time the agreement is entered into on the condition that each other party to the agreement agrees to discontinue producing an article or service that he is engaged in producing at the time the agreement is entered into, and includes any such agreement under which the parties also agree to buy exclusively from each other the articles or services that are the subject of the agreement. (accord de spécialisation)

Marginal note:Order directing registration

• 86 (1) Where, on application by any person, and after affording the Commissioner a reasonable opportunity to be heard, the Tribunal finds that an agreement that the person who has made the application has entered into or is about to enter into is a specialization agreement and that

  • (a) the implementation of the agreement is likely to bring about gains in efficiency that will be greater than, and will offset, the effects of any prevention or lessening of competition that will result or is likely to result from the agreement and the gains in efficiency would not likely be attained if the agreement were not implemented, and

  • (b) no attempt has been made by the persons who have entered or are about to enter into the agreement to coerce any person to become a party to the agreement,

  the Tribunal may, subject to subsection (4), make an order directing that the agreement be registered for a period specified in the order.

• Marginal note:Factors to be considered

  (2) In considering whether an agreement is likely to bring about gains in efficiency described in paragraph (1)(a), the Tribunal shall consider whether those gains will result in

  • (a) a significant increase in the real value of exports; or

  • (b) a significant substitution of domestic articles or services for imported articles or services.

• Marginal note:Redistribution of income does not result in gains in efficiency

  (3) For the purposes of paragraph (1)(a), the Tribunal shall not find that an agreement is likely to bring about gains in efficiency by reason only of a redistribution of income between two or more persons.

• Marginal note:Conditional orders

  (4) Where, on an application under subsection (1), the Tribunal finds that an agreement meets the conditions prescribed by paragraphs (a) and (b) of that subsection but also finds that, as a result of the implementation of the agreement, there is not likely to be substantial competition remaining in the market or markets to which the agreement relates, the Tribunal may provide, in an order made under subsection (1), that the order shall take effect only if, within a reasonable period of time specified in the order, there has occurred any of the following events, specified in the order:

  • (a) the divestiture of particular assets, specified in the order;

  • (b) a wider licensing of patents, certificates of supplementary protection issued under the Patent Act or registered integrated circuit topographies;

  • (c) a reduction in tariffs;

  • (d) the making of an order in council under section 23 of the Financial Administration Act effecting a remission or remissions specified in the order of the Tribunal of any customs duties on an article that is a subject of the agreement; or

  • (e) the removal of import quotas or import licensing requirements.

Marginal note:Registration of modifications

• 87 (1) On application by the parties to a specialization agreement that has been registered, and after affording the Commissioner a reasonable opportunity to be heard, the Tribunal may make an order directing that a modification of the agreement be registered.

• Marginal note:Order to remove from register

  (2) Where, on application by the Commissioner, the Tribunal finds that the agreement or a modification thereof that has been registered

  • (a) has ceased to meet the conditions prescribed by paragraph 86(1)(a) or (b), or

  • (b) is not being implemented,

  the Tribunal may make an order directing that the agreement or modification thereof, and any order relating thereto, be removed from the register.

Marginal note:Right of intervention

88 The attorney general of a province may intervene in any proceedings before the Tribunal under section 86 or 87 for the purpose of making representations on behalf of the province.

Marginal note:Register of specialization agreements

• 89 (1) The Tribunal shall cause to be maintained a register of specialization agreements, and any modifications of those agreements, that the Tribunal has directed be registered, and any such agreements and modifications shall be included in the register for the periods specified in the orders.

• Marginal note:Public register

  (2) The register shall be accessible to the public.

Marginal note:Non-application of sections 45, 77 and 90.1

90 Section 45, section 77 as it applies to exclusive dealing, and section 90.1 do not apply in respect of a specialization agreement, or any modification of such an agreement, that is registered.

Agreements or Arrangements that Prevent or Lessen Competition Substantially

Marginal note:Order

• 90.1 (1) If, on application by the Commissioner, the Tribunal finds that an agreement or arrangement or a proposed agreement or arrangement between persons of whom two or more are competitors prevents or lessens, has prevented or lessened or is likely to prevent or lessen competition substantially in a market, the Tribunal may make an order

  • (a) prohibiting any person — whether or not a party to the agreement or arrangement — from doing anything under the agreement or arrangement; or

  • (b) requiring any person — whether or not a party to the agreement or arrangement — with the consent of that person and the Commissioner, to take any other action.

• Marginal note:Additional or alternative order

  (1.1) If, on an application under subsection (1), the Tribunal finds that an agreement or arrangement has had or is having the effect of preventing or lessening competition substantially in a market and that an order under subsection (1) is not likely to restore competition in that market, the Tribunal may, in addition to or in lieu of making an order under subsection (1), make an order directing any or all the persons against whom an order is sought to take actions, including the divestiture of assets or shares, that are reasonable and as are necessary to overcome the effects of the agreement or arrangement in that market.

• Marginal note:Limitation

  (1.2) In making an order under subsection (1.1), the Tribunal shall make the order in such terms as will in its opinion interfere with the rights of any person to whom the order is directed or any other person affected by it only to the extent necessary to achieve the purpose of the order.

• Marginal note:Administrative monetary penalty

  (1.3) If the Tribunal makes an order against a person under subsection (1) or (1.1), it may also order them to pay, in any manner that the Tribunal specifies, an administrative monetary penalty in an amount not exceeding the greater of

  • (a) $10,000,000 and, for each subsequent order under either of those subsections, an amount not exceeding $15,000,000, and

  • (b) three times the value of the benefit derived from the agreement or arrangement, or, if that amount cannot be reasonably determined, 3% of the person’s annual worldwide gross revenues.

• Marginal note:Aggravating or mitigating factors

  (1.4) In determining the amount of an administrative monetary penalty, the Tribunal shall take into account any evidence of the following:

  • (a) the effect on competition in the relevant market;

  • (b) the gross revenue from sales affected by the agreement or arrangement;

  • (c) any actual or anticipated profits affected by the agreement or arrangement;

  • (d) the financial position of the person against whom the order is made;

  • (e) the history of compliance with this Act by the person against whom the order is made; and

  • (f) any other relevant factor.

• Marginal note:Purpose of order

  (1.5) The purpose of an order made against a person under subsection (1.3) is to promote practices by that person that are in conformity with the purposes of this section and not to punish that person.

• Marginal note:Factors to be considered

  (2) In deciding whether to make the finding referred to in subsection (1), the Tribunal may have regard to the following factors:

  • (a) the extent to which foreign products or foreign competitors provide or are likely to provide effective competition to the businesses of the parties to the agreement or arrangement;

  • (b) the extent to which acceptable substitutes for products supplied by the parties to the agreement or arrangement are or are likely to be available;

  • (c) any barriers to entry into the market, including

    • (i) tariff and non-tariff barriers to international trade,

    • (ii) interprovincial barriers to trade, and

    • (iii) regulatory control over entry;

  • (d) any effect of the agreement or arrangement on the barriers referred to in paragraph (c);

  • (e) the extent to which effective competition remains or would remain in the market;

  • (f) any removal of a vigorous and effective competitor that resulted from the agreement or arrangement, or any likelihood that the agreement or arrangement will or would result in the removal of such a competitor;

  • (g) the nature and extent of change and innovation in any relevant market;

  • (g.1) network effects within the market;

  • (g.2) whether the agreement or arrangement would contribute to the entrenchment of the market position of leading incumbents;

  • (g.3) any effect of the agreement or arrangement on price or non-price competition, including quality, choice or consumer privacy; and

  • (h) any other factor that is relevant to competition in the market that is or would be affected by the agreement or arrangement.

• Marginal note:Evidence

  (3) For the purpose of subsections (1) and (2), the Tribunal shall not make the finding solely on the basis of evidence of concentration or market share.

• Marginal note:Exception where gains in efficiency

  (4) The Tribunal shall not make an order under subsection (1) if it finds that the agreement or arrangement has brought about or is likely to bring about gains in efficiency that will be greater than, and will offset, the effects of any prevention or lessening of competition that will result or is likely to result from the agreement or arrangement, and that the gains in efficiency would not have been attained if the order had been made or would not likely be attained if the order were made.

• Marginal note:Restriction

  (5) For the purposes of subsection (4), the Tribunal shall not find that the agreement or arrangement has brought about or is likely to bring about gains in efficiency by reason only of a redistribution of income between two or more persons.

• Marginal note:Factors to be considered

  (6) In deciding whether the agreement or arrangement is likely to bring about the gains in efficiency described in subsection (4), the Tribunal shall consider whether such gains will result in

  • (a) a significant increase in the real value of exports; or

  • (b) a significant substitution of domestic products for imported products.

• Marginal note:Exception

  (7) Subsection (1) does not apply if the agreement or arrangement is entered into, or would be entered into, only by parties each of which is, in respect of every one of the others, an affiliate.

• Marginal note:Exception

  (8) Subsection (1) does not apply if the agreement or arrangement relates only to the export of products from Canada, unless the agreement or arrangement

  • (a) has resulted in or is likely to result in a reduction or limitation of the real value of exports of a product;

  • (b) has restricted or is likely to restrict any person from entering into or expanding the business of exporting products from Canada; or

  • (c) has prevented or lessened or is likely to prevent or lessen competition substantially in the supply of services that facilitate the export of products from Canada.

• Marginal note:Exception

  (9) The Tribunal shall not make an order under subsection (1) in respect of

  • (a) an agreement or arrangement between federal financial institutions, as defined in subsection 49(3), in respect of which the Minister of Finance has certified to the Commissioner

    • (i) the names of the parties to the agreement or arrangement, and

    • (ii) the Minister of Finance’s request for or approval of the agreement or arrangement for the purposes of financial policy;

  • (b) an agreement or arrangement that constitutes a merger or proposed merger under the Bank Act, the Cooperative Credit Associations Act, the Insurance Companies Act or the Trust and Loan Companies Act in respect of which the Minister of Finance has certified to the Commissioner

    • (i) the names of the parties to the agreement or arrangement, and

    • (ii) the Minister of Finance’s opinion that the merger is in the public interest, or that it would be in the public interest, taking into account any terms and conditions that may be imposed under those Acts;

  • (c) an agreement or arrangement that constitutes a merger or proposed merger approved under subsection 53.2(7) of the Canada Transportation Act in respect of which the Minister of Transport has certified to the Commissioner the names of the parties to the agreement or arrangement; or

  • (d) an agreement or arrangement that constitutes an existing or proposed arrangement, as defined in section 53.7 of the Canada Transportation Act, that has been authorized by the Minister of Transport under subsection 53.73(8) of that Act and for which the authorization has not been revoked.

• Marginal note:Limitation period

  (9.1) No application may be made under this section in respect of an agreement or arrangement that has been terminated for more than three years.

• Marginal note:Unpaid monetary penalty

  (9.2) The administrative monetary penalty imposed on a person under subsection (1.3) is a debt due to His Majesty in right of Canada and may be recovered as such from that person in a court of competent jurisdiction.

• Marginal note:Where proceedings commenced under section 45, 49, 76, 79 or 92

  (10) No application may be made under this section against a person on the basis of facts that are the same or substantially the same as the facts on the basis of which

  • (a) proceedings have been commenced against that person under section 45 or 49; or

  • (b) an order against that person has been made under section 76, 79 or 92.

• Marginal note:Definition of competitor

  (11) In subsection (1), competitor includes a person who it is reasonable to believe would be likely to compete with respect to a product in the absence of the agreement or arrangement.