L'Association Québecoise des pharmaciens propriétaires, le Groupe Jean Coutu (PJC) Inc., McMahon Essaim Inc., les Magasins Koffler de l'est Inc., Famili-Prix Inc., Pharmacentres Cumberland (Merivale) Ltée. et Uniprix Inc., Pleaded Guilty to a Charge of Conspiracy Under the Competition Act

OTTAWA, May 12, 1995 — George N. Addy, Director of Investigation and Research under the Competition Act, announced today that L'Association québécoise des pharmaciens propriétaires (AQPP), Le Groupe Jean Coutu (PJC) Inc., McMahon Essaim Inc., Les Magasins Koffler de l'Est Inc., Famili-Prix Inc., Cumberland Drugs (Merivale) Ltd. and Uniprix Inc. pleaded guilty to a charge of conspiracy under subsection 45(1)(c) of the Competition Act. The case involved cash sales of birth control pills and prescription narcotics, including the dispensing fees, in the province of Quebec in 1988. After having heard the submissions of the parties that included a suggested fine of $ 2 million dollars, Madam Justice Ginette Piché of the Superior Court of Quebec reserved her decision on sentencing until May 19, 1995.

"This is the first time a professional association has entered a guilty plea for contravening the Competition Act," said Mr. Addy. "This case clearly shows that the Act applies to the activities of professional associations incorporated under federal or provincial legislation which are not expressly authorized by a regulatory agency." Mr. Addy added: "Today's events highlight the importance of competitive markets to consumers in general and Quebec consumers in particular."

At the same time, the Crown withdrew charges for the same offence against Messrs. Jean-Guy Prud'Homme, Guy Lanoue, François-Jean Coutu, Pierre M. Bossé, Guy Marie Papillon, Michel Lesieur and Claude Gagnon, who held senior management positions in the AQPP or one of the convicted corporations at the time of the offence. However, these individuals will be subject to an order made by the Court under subsection 34(2) of the Act. The order specifically prohibits them from doing anything directed toward the repetition of the acts mentioned in the information filed by the prosecution.

This prosecution follows an investigation begun by the Director in 1988. The prosecution was originally suspended after the accused challenged the constitutionality of section 45 of the Act. On July 9, 1992, in R. v. Nova Scotia Pharmaceutical Society (PANS), the Supreme Court of Canada upheld the constitutionality of the Act's conspiracy provision and described the Act as "a central and established feature of Canadian economic policy."

"By clarifying the scope of section 45 of the Act, the decision of the Supreme Court of Canada gave new momentum to the prosecution of criminal conspiracies that lessen competition. It was this context that the present judicial proceedings against the AQPP, certain individuals and various corporations operating retail pharmacies in Quebec were resumed," Mr. Addy said.