Exam 32: Restrictive Trade Practices

The enforcement of the Competition Act

The investigation of reviewable practices and rectification orders made pursuant to those investigations under the Competition Act are procedures in the area of criminal law.

A municipality wishes to reconstruct eight kilometres of its roads. The four road contractors in the area secretly agree that only one contractor would bid (and would bid high) on the project, and later the successful bidder would divide up the work amongst them by subcontract, two kilometres each. This bid would constitute

Buns Bakery sold bread and cakes to Peggy's Grocery under an agreement whereby Peggy would not retail the goods for less than the price printed on the wrapper of the products. By their agreement, Buns Bakery would provide Peggy's Grocery with an extra 5% discount at the end of each month, based upon the volume sold at the stipulated retail price during the month. The agreement between Buns Bakery and Peggy is an agreement in restraint of trade.

Where a review indicates a business activity has been in restraint of competition, the Competition Tribunal will

Cisco developed a carburetor for automobiles, which he called the "CiscoCarb." He advertised the carburetor in a national automobile magazine in a full-page advertisement under a caption that read: "Proven Performance-80 kilometres to a litre of gas in any car." The advertisement offered the carburetor for $100 on a 30-day, money-back guarantee. Because Cisco offered the goods on a 30-day money back trial, the goods need not perform as described in the advertisement.

Under the Competition Act, restrictive trade practices are prohibited in dealings between a firm and its competitors, as well as in dealings between a firm and its customers.

Thane Direct Canada Inc. sold Abtronic muscle stimulation devices that claimed to result in weight loss and muscle toning. Thane had not done any research to validate these claims. Consumers reported the device was ineffective. What action could be brought under the Competition Act?