The Asia-Pacific Antitrust Review 2011

Canada: Cartel Enforcement

19 April 2011

Canada has a long history of prosecuting cartel behaviour. Legislation to this effect was first enacted by the Canadian parliament in 1889, a year before the Sherman Act was passed in the United States. In 1892, Canada’s competition legislation was incorporated into the Criminal Code, where it remained until 1960 and the enactment of the Combines Investigation Act. In 1986, Canada’s competition legislation underwent substantial reform, with the passage of the current Competition Act (the Act).1 Key changes included the decriminalisation of merger review and the shift from criminal sanctions against monopolies to non-criminal abuse of dominance provisions. However, cartel-like conduct remained subject to criminal sanction. In March 2010, significant amendments to the Act’s cartel prohibition came into force with the introduction of a per se criminal offence for certain ‘hard core’ cartel behaviour and a new civil provision governing other agreements between competitors that are likely to prevent or lessen competition substantially. Unlike the previous offence, the new conspiracy offence does not require proof that the agreement, if implemented, would prevent or lessen competition unduly. The elimination of the requirement to prove market impact represents a fundamental shift in the nature of Canada’s conspiracy offence and is intended to make it easier for the authorities to prosecute cartel activity in and affecting Canada.