Exam 24: Consumer Protection and Competition Law

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One of the responsibilities of the Competition Bureau is the review of proposed mergers,acquisitions,and takeovers.It is recognized that there is a fine line between allowing business to expand through merger,acquisition,or takeover in order to operate profitably in what is a relatively small but geographically dispersed market,and avoiding the negative consequences of what might,through these processes,become harmful,monopolistic behaviour.Under the Competition Act,mergers of all sizes and in all sectors of the economy are subject to review by the Commissioner to determine whether they will likely result in a substantial lessening or prevention of competition.What is considered "substantial" by the Bureau is described in its guidelines as the result of material increase in prices that is not likely to be offset by increased efficiency in the market.If the size of a proposed merger exceeds the pre-notification threshold,the businesses proposing the merger must notify the Commissioner of their intentions prior to the merger.If the Commissioner has concerns about the merger,the parties may be ordered to provide further information.Within a specified time the parties are provided with a determination as to whether the Commissioner considers that the merger will substantially lessen or prevent competition.The Commissioner then decides whether the merger can proceed as notified,only on specified conditions,or not at all.