Canadian Competition Bureau cracks down
After four months in the job, the head of the Canadian Competition Bureau (“the Bureau”), John Pecman, has revealed the Bureau’s priorities for the coming years.
The “…three priorities for the Bureau are: benefitting Canadians, through focused enforcement and through strategic regulatory interventions; applying Canada’s competition laws in a transparent and predictable matter; and building trust through enhanced collaboration;” Pecman said in a speech delivered in Montreal on the 30 January 2013.
In a step towards delivering these priorities, Pecman sought to clarify the Bureau’s investigative procedures for non-merger, civil matters under formal inquiry.
In particular, Pecman stated that from now on when commencing an investigation, the Bureau would in all but exceptional cases seek legally binding orders under section 11 of the Canadian Competition Act instead of issuing a voluntary information requests, as it had done in some cases previously.
This decision came after numerous delays and complications to investigations caused by utilising the voluntary process.
“Unfortunately…parties may be using the…[voluntary information request] process for their own strategic purpose,” Pecman said. “Too often, parties say they’ll comply with a voluntary request for information, only to backtrack and contest the basis for the Bureau’s investigation when deadlines loom or lapse.”
Another issue with using voluntary information requests was that parties may provide less than adequate responses to the Bureau’s inquiries.
Pecman said that the shift to seeking section 11 orders should not be seen as a punishment, but rather as an indication of the Bureau’s commitment to ensuring investigations are conducted in the most rigorous, efficient and effective way possible.
The Bureau is continuing its voluntary information process for merger investigations.
Section 11 of the Canadian Competition Act allows the Commissioner of the Bureau to apply to the court for an order that a person who has or is likely to have information that is relevant to an inquiry to provide information, documents and/or give evidence regarding that inquiry.
The section is similar to section 155 of the Australian Competition and Consumer Act 2010 (Cth) (“CCA”).
Section 155 of the CCA confers wide powers on the Australian Competition and Consumer Commission (“ACCC”) to require a person to provide information, documents and/or give evidence where the Chairman or Deputy Chairman of the ACCC has ‘reason to believe’ that a person has information, documents or evidence about a matter that constitutes or may constitute a breach of the CCA.
However, unlike section 11, section 155 does not require the ACCC to go to court to exercise its powers. The ACCC has issued guidance* which states that the ACCC does not use its section 155 powers lightly and “prefers to obtain its information through cooperation” in circumstances where it is appropriate to do so.”
* This guidance refers to section 155 of the Trade Practices Act 1974, which is now the CCA.