Merger Enforcement Guidelines (Banks) - The Definition of "Merger"

Merger Enforcement Guidelines (Banks) - The Definition of "Merger"

16. Section 91 of the Actdefines a merger as any transaction in which control over, or a significant interest in, the whole or a part of a business of another person is acquired or established. With respect to corporations, "control" is explicitly defined in section 2(4) of the Act to mean de jure control, i.e., a direct or indirect holding of more than 50 percent of the votes that may be cast to elect directors of the corporation, and which are sufficient to elect a majority of such directors. Although significant interest is not defined in the Act, the Bureau's position is that a "significant interest" in the whole or a part of a business is held when one or more persons have the ability to materially influence the economic behaviour (e.g., decisions relating to pricing, purchasing, distribution, marketing or investment) of that business or of a part of that business. Given the range of management and ownership structures which exist, a determination of whether a significant interest is likely to be acquired or established must be made on a case by case basis.