Bill C-352: An Act to amend the Competition Act and the Competition Tribunal Act

Alternative Title Alternative Title 1 This Act may be cited as the Lowering Prices for Canadians Act . R.S., c. C-34 Competition Act 2 Paragraph 10(1)(b) of the Competition Act is amended by striking out “or” at the end of subparagraph (ii) and by adding the following after subparagraph (iii): (iv) a market study and reports on market conditions would provide insight into factors that are relevant to competition, or 3 Subsection 45(2) of the Act is replaced by the following: Penalty (2) Every person who commits an offence under subsection (1) or (1.1) is guilty of an indictable offence and liable on conviction to imprisonment for a term not exceeding 14 years or to a fine not exceeding the greater of the following, or to both imprisonment and fine : (a) $25,000,000, and (b) three times the value of the benefit derived from the conspiracy, agreement or arrangement or, if that amount cannot be reasonably determined, 10% of the person’s annual worldwide gross revenues. 4 The portion of subsection 49(1) of the Act after paragraph (f) is replaced by the following: and every director, officer or employee of the federal financial institution who knowingly makes such an agreement or arrangement on behalf of the federal financial institution is guilty of an indictable offence and liable to a fine not exceeding twenty-five million dollars or to imprisonment for a term not exceeding fourteen years or to both. 5 Subsection 78(1) of the Act is amended by striking out “and” at the end of paragraph (i), by adding “and” at the end of paragraph (j) and by adding the following after paragraph (j): (k) directly or indirectly imposing excessive and unfair selling prices. 6 (1) Subsection 79(1) of the Act is amended by adding “and” at the end of paragraph (a), by striking out “and” at the end of paragraph (b) and by repealing paragraph (c). (2) Subsection 79(2) of the Act is replaced by the following: Additional or alternative order (2) If, on an application under subsection (1), the Tribunal also finds that a practice of anti-competitive acts 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 such actions, including the divestiture of assets or shares, as are reasonable and as are necessary to overcome the effects of the practice in that market. (3) Paragraphs 79(3.1)(a) and (b) of the Act are replaced by the following: (a) $25,000,000 and, for each subsequent order under either of those subsections, an amount not exceeding $35,000,000 , and (b) three times the value of the benefit derived from the anti-competitive practice, or, if that amount cannot be reasonably determined, 10% of the person’s annual worldwide gross revenues. (4) The portion of subsection 79(4) of the Act before paragraph (a) is replaced by the following: Factors to be considered (4) In determining, for the purposes of subsection ( 2 ), whether a practice has had, is having or is likely to have the effect of preventing or lessening competition substantially in a market, the Tribunal shall consider whether the practice is a result of superior competitive performance and may consider 7 (1) Subsection 90.1(2) is amended by striking out “and” at the end of paragraph (g.3) and by adding the following after that paragraph: (g.4) whether 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 (2) Subsection 90.1(4) of the Act is repealed. (3) Subsection 90.1(5) of the Act is replaced by the following: Restriction (5) For the purposes of paragraph (2)(g.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. (4) The portion of subsection 90.1(6) of the Act before paragraph (a) is replaced by the following: Factors to be considered (6) In having regard to whether an agreement or arrangement is likely to bring about gains in efficiency described in paragraph (2)(g.4), the Tribunal shall consider whether such gains will result in 8 The Act is amended by adding the following after section 91: Order — greater than 60% combined market share 91.1 (1) Where, on application by the Commissioner, the Tribunal finds that a merger or proposed merger has resulted or is likely to result in a combined market share of 60% or more, the Tribunal shall, as the case may be, order the parties to the merger or any other relevant person to dissolve the merger in such manner as the Tribunal directs or make an order against them not to proceed with the merger. Order — 30% to 60% combined market share 91.2 (1) Where, on application by the Commissioner, the Tribunal finds that a merger or proposed merger has resulted or is likely to result in a combined market share of 30% to 60%, the Tribunal shall, as the case may be, order the parties to the merger or any other relevant person to dissolve the merger in such manner as the Tribunal directs or make an order against them not to proceed with the merger. Exception — procompetitive outcomes (2) The Tribunal may decide not to make an order under subsection (1), if the parties to a merger or proposed merger establish on a balance of probabilities that the merger or proposed merger has resulted in or is likely to result in substantial procompetitive outcomes, including reductions in prices, increases in supply, reductions of anti-competitive acts, increases in quality of goods or services, increases in wages and increases in consumer choice and consumer protection. 9 (1) The portion of subsection 92(1) of the Act between paragraphs (d) and (e) is replaced by the following: the Tribunal may, subject to sections 94 and 95 , (2) Subsection 92(2) of the Act is replaced by the following: Presumption (2) For the purpose of this section, if the Tribunal finds, on a balance of probabilities, that a merger or proposed merger will cause a significant increase in concentration or market share, the Tribunal shall also find that the merger or proposed merger prevents or lessens, or is likely to prevent or lessen, competition substantially, unless the contrary is proved on the balance of probabilities by the parties to the merger or proposed merger . 10 (1) Section 93 of the Act is amended by striking out “and” at the end of paragraph (g.3) and by adding the following after that paragraph: (g.4) whether the merger or proposed merger 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 merger or proposed merger; and (2) Section 93 is renumbered as subsection 93(1) and is amended by adding the following subsections: Restriction (2) For the purposes of paragraph (1)(g.4), the Tribunal shall not find that a merger or proposed merger has brought or is likely to bring about gains in efficiency by reason only of a redistribution of income between two or more persons. Factors to be considered (3) In having regard to whether a merger or proposed merger is likely to bring about gains in efficiency described in paragraph (2)(g.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. 11 Section 96 of the Act is repealed. 12 Section 97 of the Act is replaced by the following: Limitation period 97 No application may be made under section 92 in respect of a merger more than three years after the merger has been substantially completed. R.S., c. 19 (2nd Supp.) Competition Tribunal Act 13 Subsection 8.1(3) of the Competition Tribunal Act is repealed.