September 27, 2012
At face value, the recent intervention by the Competition Bureau in a $6 million acquisition - the bureau's first challenge of a merger since 2005 - and its limited action in the proposed $4-billion purchase of the company that owns Canada's best-known stock exchanges may seem inconsistent.
But the Competition Bureau has been flexing its muscles on merger reviews in recent years under the leadership of commissioner Melanie Aitken and with the help of amendments to competition legislation in 2009. Experts say the purchase of TMX Group Inc. by a consortium of Canadian banks was in fact subject to tough scrutiny by both the bureau and provincial securities regulators. And the bureau plans to continue aggressive enforcement and the development of jurisprudence on tests for prevention of competition.
"I dare say we cast a longer shadow today than we did three years ago," Ms. Aitken told a Canadian Bar Association conference in Ottawa last week in one of her final public speeches as commissioner.
The purchase of TMX Group by a consortium of Canadian banks has been called anti-competitive by some lawyers and independent brokers. But the bureau cleared the deal this summer following a slew of recognition orders from the securities regulators that oversee the exchanges.
"I think there's been a lot of speculation in the market that they have been interested in pursuing cases related to prevention of competition and have been interested in bringing a case that falls below the notification threshold," said Linda Plumpton.
Competition lawyers say enforcement is increasing in all areas of the field. To illustrate the point, Linda pointed to the bureau's initiation of a $30-million lawsuit against Canada's major wireless carriers earlier this month for allegedly misleading subscribers about the costs of third-party applications.
"We're seeing more enforcement activity, including cases that find their way all the way to the tribunal, in the last two years than we've seen over the last several years," said Linda.
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