Acquisitions » Canada’s New Appetite for Antitrust Litigation

Canada’s New Appetite for Antitrust Litigation

March 15, 2013

Commissioner of Competition v CCS Corporation, decided in May 2012, was only the sixth litigated merger in Canada’s history. In bringing – and winning – the case, the Canadian Competition Bureau demonstrated to the Canadian marketplace that antitrust enforcement will have to be taken seriously. According to the authors, investors and companies doing business in Canada would be wise to take heed of these developments.

The Commissioner’s case was that the transaction prevented competition that had not yet arisen – in contrast to the standard mergers case, where the allegation is that the transaction will lessen pre-existing competition. By the time the Commissioner brought her case, the deal had already closed. This caused the issue of remedy to play a central role in the hearing.

The Commissioner won the case, demonstrating that the merger prevented competition in the hazardous waste disposal market in Northeastern British Columbia. CCS Corporation was ordered to sell off the key assets it acquired through the merger.

The case is notable for several reasons, chief among them the fact that, at $6.1 million dollars, the size of the deal fell well below the mandatory reporting thresholds in Canada. Historically, the Competition Bureau only took an interest in mergers that exceeded the notification thresholds. Although everyone knew that even small deals could be challenged, until the CCS decision, deals that fell under mandatory reporting thresholds tended to fly beneath the enforcer’s radar. That is no longer the case.

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