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Feature
IN LINE with an international trend,
Canadian regulators are becoming more asser-
tive and interventionist, particularly in the
competition and foreign investment realms.
For mergers and acquisitions, lawyers say deals
are taking longer, risk and uncertainty are
building, and proponents must work proac-
tively to show regulators that the transaction
is aligned with their broader objectives.
Canadian competition law is undergoing
its first major reforms in over a decade. On
Dec. 15, Bill C-56, e Affordable Housing
and Groceries Act, came into force.
e amendments repealed the efficiencies
defence for mergers. Sean Stevens, co-leader of
the capital markets and M&A group at Fasken
Martineau DuMoulin LLP, says this defence
was a unique aspect of Canadian antitrust law.
It meant that a transaction that would other-
wise be anticompetitive could be permitted
if its participants could demonstrate that
it would enhance economic efficiency and
provide a net benefit to the economy.
"Now that specific criteria have been
removed, it doesn't mean that won't be
considered in the overall evaluation. But we've
lost that as a defence." Stevens adds that the
defence was seldom successful, being a deci-
sive factor in only a handful of cases in the last
15 years.
Bill C-56 gave the Competition Bureau new
powers to conduct market studies, including
compulsory information-gathering powers. A
market study is an industry-wide investigation
that examines competitive dynamics. ere
need not be a contravention or suspected
contravention of the Act, and the bureau has
long had the power to conduct these studies.
In 2008, the bureau looked at the generic drug
industry, and, since 2017, it has conducted
market studies on financial services, broad-
band, digital healthcare services, and the retail
grocery market.
e legislation makes two significant
changes to the bureau's power to conduct
market studies, says Navin Joneja, co-chair
of the competition, antitrust, and foreign
investment group at Blake Cassels & Graydon
LLP. First, prior to the new legislation, the
REGULATORS MORE
ASSERTIVE AND
INTERVENTIONIST
Feature
LAWYERS TELL AIDAN MACNAB THAT
AGGRESSIVE REGULATORY SCRUTINY MEANS
DEALS TAKE LONGER AND MUST CONTEND
WITH HEIGHTENED RISK
