Archived — Merger Review Performance Report

Report

2007


Introduction

The Competition Bureau is an independent law enforcement agency. We contribute to the prosperity of Canadians by protecting and promoting competitive markets and enabling informed consumer choice. The Bureau’s approach to the administration and enforcement of the Acts is based on five principles: confidentiality, fairness, predictability, timeliness, and transparency.

In November 1997, the Bureau introduced fees and service standards for certain services and merger review under the Competition Act ( Act ) (refer to Table 1 ). At that time, the Bureau committed to holding ongoing consultations to collect stakeholder feedback. The merger notification filing and advance ruling certificate (ARC) request fees are currently at $50,000.

Table 1 : Merger review service standards
Merger Notification Filings and ARC Requests Service Standard1
Non-Complex 2 weeks
Complex 10 weeks
Very Complex 5 months

On April 1, 2003, after extensive consultations, the Bureau revised its Fee and Service Standards Policy (Policy) and its Fee and Service Standards Handbook 2 (Handbook) to better reflect the cost of merger review and binding written opinions. The Handbook was further revised in December 2003 to reflect the Bureau’s first six months of experience with the revised Policy and further stakeholder feedback.

This report is intended to provide an update on the performance of the Bureau’s Mergers Branch since the last Merger Review Performance Report3 that was published in October 2004. This report will also form the basis for part of the consultations to be held at a Forum scheduled for June 12, 2007.

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Workload and Resources

Table 2 : Caseload 4
    Merger Notification Filings 5 Advanced Ruling Certificate Requests Other Examinations Total
2000-2001 # 73 255 45 373
% 20 68 12 100
2001-2002 # 59 243 26 328
% 18 74 8 100
2002-2003 # 28 224 27 279
% 10 80 10 100
2003-2004 # 22 159 21 202
% 11 79 10 100
2004-2005 # 31 214 24 269
% 11 80 9 100
2005-2006 # 17 242 26 285
% 6 85 9 100
2006-2007 # 18 250 32 300
% 6 83 11 100

It is difficult to predict the volume and complexity of merger notifications the Mergers Branch will receive in a given year since it depends on external factors; nonetheless, the Branch must be able to handle any sudden influx of work. To a certain extent, it may be able to draw on resources elsewhere in the Bureau; as well, in certain cases, the Mergers Branch has hired industry and economic experts in addition to outside counsel to supplement its staff.

As Table 2 shows, there was a decline in the number of mergers reviewed by the Bureau from 2000-2001 to 2003-2004. This was caused in part by global economic conditions and the raising in April 2003 of the transaction-size threshold 6 above which merging parties must notify the Bureau of their transaction (from $35 million to $50 million). This decline was followed by three years of significant increases in the number of merger notification filings and advance ruling certificate requests that started in 2004-2005 and continues.

The size and scope of the mergers since 2004 have also been notable, as has the complexity of the competition issues they raise. Cases that have consumed very large amounts of time and money in the period starting with fiscal year 2004-2005 include the CN / BC Rail file and mergers in the forestry, grain handling and media industries. 7

Since the last report, the Mergers Branch has been involved in many activities. Some of the major work undertaken since 2004 includes: a merger remedies study; policy consideration in the area of efficiencies in merger review; a bulletin on merger remedies; technical backgrounders; and an ex-post review. Each project contributes uniquely to the needs of stakeholders.

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Merger Remedies Study

As noted above, the Bureau is currently undertaking a study to determine whether or not past merger remedies sought by the Bureau were effective in addressing the competition concerns identified in the relevant market(s) at issue. The goal is to gain an understanding of the factors that either contributed to, or detracted from, the efficacy of such remedies. An understanding of such factors is necessary to further advance the Bureau’s practice with respect to the design and implementation of effective merger remedies.

The Study is currently in the initial phases. The methodology is almost finalized and interviews with relevant market participants should commence in the next few months. Although the Study will evaluate all remedy types, more emphasis will be put on evaluating behavioural and certain quasi-structural remedies. Once the Study is complete, the Bureau intends to release a public version.

Efficiencies in Merger Review

The 2004 Merger Enforcement Guidelines (MEGs) describe the analytical framework used by the Bureau in assessing claims by merging parties that gains in efficiency brought about by a merger will be greater than and will offset the anti‑competitive effects arising from that merger. There remain practical challenges in applying that framework. To address some of those challenges, the Bureau is currently conducting further policy work on efficiencies and plans to share further elaborations on certain aspects of efficiencies in merger review in an effort to clarify our enforcement approach in this important area. Among the issues we may address is the role of efficiencies in the competition analysis under section 92, particularly following comments made by the Competition Tribunal in the Superior Propane/ICG merger case.

Bulletin on Merger Remedies

During public consultations on the revision of the Merger Enforcement Guidelines (MEGs) in 2004, a number of stakeholders raised the prospect of the Bureau releasing guidelines or a policy paper on the issue of remedies in the context of mergers. In response to these requests, the Bureau issued an Information Bulletin on Merger Remedies in Canada8 in September 2006. This document followed extensive consultations within the Bureau, with members of the Canadian competition law bar, and with authorities in the United States and the European Union. It resembles initiatives in other jurisdictions where competition authorities have conducted reviews of their merger remedies policies to ensure that they are as effective as possible.

In general, the Bureau's choice of remedy is based on the unique circumstances of a case. The Information Bulletin on Merger Remedies in Canada sets out how the Bureau will, generally, seek, design and implement remedies to resolve concerns where the Bureau believes there is a likely substantial lessening or prevention of competition arising from a merger. Recently, the Bureau published a template for consent agreements as an appendix to the Bulletin.

Technical Backgrounders

In response to public demand for increased transparency in its investigative work, the Bureau published a policy on technical backgrounders in April 2005. The policy sets out the circumstances in which the Bureau will provide details of its analysis and the reasons behind its conclusions in particular investigations. The Bureau may issue a technical backgrounder:

  • Where a matter has received substantial publicity;
  • When issues are sufficiently important or complex;
  • Where there is a need to clarify a point of law or policy;
  • Where there is a significant impact on consumers; and
  • Where the release will encourage greater compliance with the law through education.

In determining whether or not to publish a technical backgrounder, the Bureau will also be guided by the confidentiality provisions of the Act and will consider comments on confidentiality from the parties involved in the case. For additional information on technical backgrounders, please refer to the Policy Statement for the Publication of Technical Backgrounders.9

Since the introduction of this policy, the Mergers Branch has published ten technical backgrounders on merger cases, which have been well-received by stakeholders. The Bureau is committed to continuing its efforts at transparency by issuing further technical backgrounders in the future. It should be understood that Technical Backgrounders10 published by the Bureau are not intended to set precedents and will not be published when a case goes before the Competition Tribunal or the courts.

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Ex-Post Merger Review

Following a RFP (Request for Proposal) process, the Bureau hired Charles River Associates International Ltd. in 2006 to undertake a post-merger review project. The objective of the study was to consider a merger that had raised material competition concerns, but where the Bureau's final conclusion was that the transaction did not merit a challenge before the Competition Tribunal. A second criterion was that a sufficient period of time had to have passed since the closing of the transaction to allow for the market to adjust to the merger. The study was to consider whether the current market is substantially less competitive than it was pre-merger, and whether appropriate decisions were taken by the Bureau in the specific case. Questions to be explored included:

  • Have the competitive effects anticipated by the Bureau at the time of its conclusions come about, post-merger?
  • Is the market more or less competitive and, if so, why?
  • Were any relevant factors overlooked at the time of the original review?
  • Did the original conclusions prove, over time, to be correct?
  • Were the correct techniques used in applying the Bureau's analytical framework?

It was ultimately decided that three mergers would be included in the study, with particular attention given to one. Interviews were conducted with a number of market participants, and additional research was undertaken. In addition, CRA reviewed the Bureau files on these mergers. The study is in its very final stages, and a public version will be released shortly.

Table 3 : Cost of merger reviews
  Full Time Staff Direct Costs (millions) Indirect Bureau Costs (millions) Major Expenditures
2000-2001 57 9.5 Not Available Chapters/Indigo ; and Waste litigation
2001-2002 58 11.3 0.9 Propane; Abitibi/Donohue; and the Astral/Telemedia files.
2002-2003 57 9.7 0.3 UGG/Agricore ; Propane; Abitibi/Donohue; and the Astral/Telemedia files.
2003-2004 58 6.5 0.3 Waste ; ONR; and the CN / BC Rail files.
2004-2005 65 9.4 0.5 West Fraser/ Weldwood ; Telus/Microcell; CN / BC Rail; and Waste.
2005-2006 73 10.5 0.6 Saskatchewan Wheat Pool/James Richardson International ; Cargill/Better Beef; Tolko/Riverside; and UGG/Agricore.
2006-2007 73 11.6 0.7 Labatt/Lakeport ; Saskatchewan Wheat Pool/Agricore United; Bell Globemedia/CHUM; UGG/Agricore; Saskatchewan Wheat Pool/James Richardson International; and James Richardson International / Agricore United.

*Note: Table 3 does not include substantial costs incurred by the Government but not paid out of the Bureau budget. These expenditures include a portion of other government department services (such as the Department of Public Works and Government Services and the Department of Finance), and a portion of human resource and communications services provided by Industry Canada.

The direct costs of merger review include the salaries for the staff in the Bureau whose work relates to merger review. The major non-salary direct costs include the expenditures associated with hiring economic and industry experts, and external legal support and lawyers assigned to merger review at the Department of Justice (DOJ). The indirect costs associated with merger review include non-salary Bureau overhead expenditures, such as informatics and administration.

From 1997, when the fees were first introduced, until 2002-2003, the costs associated with merger review were higher than the revenues generated through the fees. The Bureau historically covered these additional costs with a portion of its base budget. One of the key challenges is that the Mergers Branch cannot accurately predict the number of filings, nor the complexity of those filings; accordingly, it cannot accurately predict the associated costs for a particular period.

Since 2003-2004, the revenues collected by Mergers Branch have exceeded the costs expended, by, on average, 1.7 M per year. The Bureau is very conscious of the need to ensure that the scale of revenues collected is indeed necessary to perform our work. To that end, as noted below, we plan, at the end of fiscal 2007-2008, to review our resource expenditures over the five-year cycle since the fees were increased. In assessing over a five-year term, we hope to account for the cyclical nature of merger review demands, and to be using a statistically relevant sample of years, complexity levels, costs, and revenues.

It is relevant to note that, as reflected in Table 3 , the number of very complex cases requiring significant cost outlays is increasing. The time constraints involved in some reviews such as certain hostile transactions can add to the already significant cost. In order to complete these and other reviews in a timely and effective way, the Mergers Branch has found it necessary to hire multiple industry and economic experts who can provide sophisticated analysis under very tight time constraints. We have also supplemented our DOJ legal teams by hiring outside counsel. We endeavor to purchase data, if available, from third parties. Finally, we continue to recruit a significant number of top-tier graduates.

At the same time, we remain sensitive to the importance of monitoring filing fees and aggregate revenues to ensure that fees are at an appropriate level. And it is to that end that we anticipate conducting a review at the end of this fiscal year.

Table 4 : Revenue generated through merger notification
  Revenue generated through merger notification and ARC requests
(millions)
2000-2001 8.4
2001-2002 7.5
2002-2003 6.3
2003-2004 8.8
2004-2005 12.4
2005-2006 12.9
2006-2007 13.2

Filing Complexity and Service Standards

Table 5 : Volume of cases by level of complexity11
  Non Complex Complex Very Complex Total
2000-2001 # 282 52 14 348
% 81 15 4 100
2001-2002 # 271 41 2 314
% 86 13 1 100
2002-2003 # 215 21 2 238
% 90 9 1 100
2003-2004 # 165 18 2 185
% 89 10 1 100
2004-2005 # 213 19 8 240
% 89 8 3 100
2005-2006 # 216 36 7 259
% 83 14 3 100
2006-2007 # 238 22 3 263
% 91 8 1 100

The Bureau predicted in 1997 that 5 per cent of filings would be classified as very complex. Experience has shown that this estimate was somewhat high; during the last three fiscal years, the percentage of filings categorized as very complex has fluctuated between 3 per cent and 1 per cent. While these numbers may appear low, the complex and very complex filings account for the bulk of the Mergers Branch’s expenditures. Complex and very complex filings are the cases that raise serious competition concerns and where remedial action and/or court proceedings are more likely to be necessary. Resolving these cases requires expert witnesses, economists and legal counsel, costing the Bureau significant resources.

Table 6 : Percentage of filings where the service standard was met
  Service Standard 2000-2001 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007
Non-Complex 2 weeks 270

95.7%
258

95.2%
213

99.1%
164

99.4%
208

97.7%
205

94.9%
225

94.5%
Complex 10 weeks 48

92.3%
36

87.8%
20

95.2%
17

94.4%
17

89.5%
34

94.4%
20

90.9%
Very Complex 5 months 14

100%
2

100%
2

100%
2

100%
7

100%
6

85.7%
2

66.67%
Total 332

95.4%
296

94.3%
235

98.7%
183

98.9%
232

96.6%
245

94.6%
247

93.9%

As Table 6 indicates, the Mergers Branch has consistently met service standards in the majority of filings. In a few cases, the service standard “clock” was suspended to collect from the parties necessary information before proceeding with the review. There was only one case during 2003-2004 where the clock was suspended; it was suspended for less than one day. Between fiscal years 2004-2005 and 2006-2007, the service standard “clock” was suspended in eight cases (after a request for supplementary information had been made to merging parties and no adequate response received within the time frames specified in the Handbook 12 ). Six of those cases were non-complex and the service standard clock was paused on average for five days (a range of less than one day to ten days). There was also one complex and one very complex case where the service standard was paused, for 60 and 36 days respectively.

Figure 1: Meeting the Service Standard - Fiscal Year 2002-2003

Non-complex cases - fiscal year 2002-2003
Number of Days Within Which Decision was Communicated Number of Cases

Total :
215 Cases

(0, 10, 20, 30, 40)
1 7
2 4
3 5
4 4
5 8
6 9
7 16
8 19
9 14
10 (Average delay: 10,0 days) 21
11 9
12 29
13 30
14 (Service Standard: 14 days) 39
15 2
16 0
17 0
18 0
19 0
20 0
More than 20 0
Complex cases - fiscal year 2002-2003
Number of Weeks Within Which Decision was Communicated Number of Cases

Total :
21 Cases

(0, 2, 4, 6, 8)
1 1
2 0
3 3
4 6
5 (Average delay : 5,5 weeks) 3
6 2
7 2
8 1
9 0
10 (Service Standard : 10 weeks) 2
More than 10 1
Very complex cases - fiscal year 2002-2003
Number of Months Within Which Decision was Communicated Number of Cases

Total :
2 Cases

(0, 1, 2, 3, 4)
1 0
2 1
3 (Average delay : 3,0 months) 0
4 1
5 (Service Standard : 5 months) 0
6 0
7 0
8 0
9 0
10 0
More than 10 0

Figure 2: Meeting the Service Standard - Fiscal Year 2003-2004

Non-complex cases - fiscal year 2003-2004
Number of Days Within Which Decision was Communicated Number of Cases

Total:
165 Cases

(0, 10, 20, 30, 40)
1 10
2 7
3 10
4 9
5 8
6 5
7 16
8 (Average delay : 8,3 days) 21
9 12
10 14
11 12
12 15
13 16
14 (Service Standard : 14 days) 12
15 0
16 0
17 0
18 0
19 0
20 0
More than 20 1
Complex cases - fiscal Year 2003-2004
Number of Weeks Within Which Decision was Communicated Number of Cases

Total :
18 Cases

(0, 2, 4, 6, 8)
1 1
2 1
3 2
4 1
5 2
6 (Average delay : 6,0 weeks) 3
7 4
8 1
9 0
10 (Service Standard : 10 weeks) 2
More than 10 1
Very complex cases - fiscal year 2003-2004
Number of Months Within Which Decision was Communicated Number of Cases

Total:
2 Cases

(0, 1, 2, 3, 4)
1 1
2 0
3 (Average delay : 3,0 months) 0
4 0
5 (Service Standard : 5 months) 1
6 0
7 0
8 0
9 0
10 0
More than 10 0

Figure 3: Meeting the Service Standard - Fiscal Year 2004-2005

Non-complex cases - fiscal year 2004-2005
Number of Days Within Which Decision was Communicated Number of Cases

Total :
213 Cases

(0, 10, 20, 30, 40)
1 6
2 13
3 13
4 13
5 13
6 31
7 23
8 (Average delay : 7,9 days) 15
9 7
10 16
11 15
12 19
13 14
14 (Service Standard: 14 days) 10
15 1
16 1
17 0
18 1
19 0
20 0
More than 20 2
Complex cases - fiscal year 2004-2005
Number of Weeks Within Which Decision was Communicated Number of Cases

Total :
19 Cases

(0, 2, 4, 6, 8)
1 2
2 0
3 2
4 2
5 1
6 2
7 (Average delay : 7,1 weeks) 1
8 2
9 2
10 (Service Standard : 10 weeks) 3
More than 10 2
Very complex cases - fiscal year 2004-2005
Number of Months Within Which Decision was Communicated Number of Cases

Total :
8 Cases

(0, 1, 2, 3, 4)
1 0
2 2
3 1
4 (Average delay : 4,1 months) 3
5 (Service Standard : 5 months) 1
6 0
7 0
8 0
9 1
10 0
More than 10 0

Figure 4: Meeting the Service Standard - Fiscal Year 2005-2006

Non-complex cases - fiscal year 2005-2006
Number of Days Within Which Decision was Communicated Number of Cases

Total :
216 Cases

(0, 10, 20, 30, 40)
1 10
2 3
3 10
4 10
5 9
6 12
7 21
8 23
9 (Average delay : 9,1 days) 17
10 17
11 12
12 21
13 17
14 (Service Standard : 14 days) 23
15 5
16 3
17 1
18 1
19 0
20 0
More than 20 1
Complex cases - fiscal year 2005-2006
Number of Weeks Within Which Decision was Communicated Number of Cases

Total :
36 Cases

(0, 2, 4, 6, 8)
1 1
2 4
3 6
4 2
5 (Average delay : 5,8 weeks) 6
6 5
7 4
8 2
9 0
10 (Service Standard : 10 weeks) 4
More than 10 2
Very complex cases - fiscal year 2005-2006
Number of Months Within Which Decision was Communicated Number of Cases

Total :
7 Cases

(0, 1, 2, 3, 4)
1 1
2 1
3 0
4 (Average delay : 3,9 months) 2
5 (Service Standard : 5 months) 2
6 1
7 0
8 0
9 0
10 0
More than 10 0

Figure 5: Meeting the Service Standard - Fiscal Year 2006-2007

Non-complex cases - fiscal year 2006-2007
Number of Days Within Which Decision was Communicated Number of Cases

Total :
238 Cases

(0, 10, 20, 30, 40)
1 11
2 7
3 7
4 7
5 7
6 10
7 17
8 16
9 13
10 (Average delay : 10,1 days) 19
11 25
12 16
13 34
14 (Service Standard : 14 days) 36
15 3
16 1
17 1
18 1
19 0
20 0
More than 20 7
Complex cases - fiscal year 2006-2007
Number of Weeks Within Which Decision was Communicated Number of Cases

Total :
22 Cases

(0, 2, 4, 6, 8)
1 1
2 3
3 2
4 4
5 1
6 (Average delay : 6,3 weeks) 3
7 3
8 0
9 0
10 (Service Standard : 10 weeks) 3
More than 10 2
Very complex cases - fiscal year 2006-2007
Number of Months Within Which Decision was Communicated Number of Cases

Total :
3 Cases

(0, 1, 2, 3, 4)
1 0
2 0
3 1
4 (Average delay : 3,8 months) 1
5 (Service Standard: 5 months) 0
6 0
7 1
8 0
9 0
10 0
More than 10 0

Feedback Leaflets

When the Fee and Service Standards Policy was developed in 1997, the Bureau also included feedback mechanisms to ensure that those w ho sought services or were bound by regulatory processes to which a fee applied, had timely and systematic opportunities to provide ongoing inp ut about service levels and quality of service. Feedback Leaflets were developed to allow stakeholders to provide written feedback on specific Bureau services.

Between 1997 and 2003, generic Feedback Leaflets were used to capture service level feedback on both Advisory Opinions and Merger Review. In January 2004, the Leaflet was revised and two new Feedback Leaflets were developed, one for merger review and one for Written Opinions. Starting in January 2004, every response to a merger notification and/or ARC request has been accompanied by a blank revised Feedback Leaflet.

In response to concerns raised during the Merger Review Benchmarking Study13, the Bureau assigned the Compliance and Operations Branch the task of receiving the Feedback Leaflets and compiling the data received. This way, a respondent’s anonymity is preserved. Photocopies of signed leaflets are sent immediately to the Mergers Branch and reports of all leaflets received are provided every six months. While the revised Feedback Leaflet was designed to capture more detailed information on the quality of service, owing to the decrease in return rates, the volume of precise feedback made available to managers has, overall, declined.

During fiscal year 2001-2002, there was a return rate of 34 per cent. The Bureau assumes that the high return rate in 2001-2002 was owing to the ongoing consultations of the Competition Law Section of the Canadian Bar Association during the Merger Review Benchmarking Study and the subsequent publication of its findings in June 2001. With the introduction of the revised Feedback Leaflet in 2003, the return rates decreased significantly. Throughout fiscal years 2002-2003, 2003-2004, 2004-2005, 2005-2006, and 2006-2007, the return rates have been: 22 per cent, 22 per cent, 18 per cent, 16 per cent and 7 per cent, respectively. Monitoring Merger Review through revised Feedback Leaflets.

Table 7 : Service staff 2004-2007
  2004-2005 2005-2006 2006-2007
# % # % # %
Courtesy of Staff Good 41 100% 40 98% 18 100%
Poor 0 0 1 2% 0 0
Helpfulness of Staff Good 39 95% 39 98% 18 100%
Poor 2 5% 1 2% 0 0
Knowledge level of Staff Good 40 100% 37 97% 17 100%
Poor 0 0 1 3% 0 0

Between 2004 and 2007 the Bureau received high scores on these aspects of its service on the feedback leaflets, with the majority of respondents ranking staff services as “good”.

Table 8 : Resources 2004-2007
  2004-2005 2005-2006 2006-2007
# % # % # %
Competition Bureau Website Good 33 92% 35 92% 10 77%
Poor 3 8% 3 8% 3 23%
Fee and Service Standard Handbook Good 35 97% 40 100% 14 100%
Poor 1 3% 0 0 0 0
Merger Enforcement Guidelines Good 29 88% 40 100% 14 100%
Poor 4 12% 0 0 0 0

The Bureau received favourable feedback with respect to the Fee and Service Standards Handbook and the Merger Enforcement Guidelines , while the Website received mixed reviews. Notably, the Bureau received a 77 per cent satisfaction rate with respect to the Web site in 2006-2007. This was indicative of a problem concerning the ease of access to some of the merger information (form, procedures guide and interpretation guidelines). This complaint was received directly from stakeholders on numerous occasions, and we have taken steps to address these concerns by adding a direct link on the main merger page leading users to all relevant Merger Notification publications.

Table 9: Service standard 2004-2007
  2004-2005 2005-2006 2006-2007
# % # % # %
Was Your Request Provided to You Within the Specified Service Standard Timeframe? Yes 41 95% 39 95% 17 100%
No 2 5% 2 5% 0 0

The majority of requests were provided within the specified service standard timeframe.

Table 10: Profile of respondents 2004-2007
  2004-2005 2005-2006 2006-2007
# % # % # %
Service Requested Merger Notification 6 14% 9 22% 2 11%
ARC 28 64% 27 64% 13 72%
Merger Notification and ARC 10 22% 6 14% 3 17%
Discussion with Merger Notifications Unit Prior to Request Yes 28 64% 28 67% 6 35%
No 16 36% 14 33% 11 65%
Classified As Non-Complex 38 93% 35 88% 16 89%
Complex 3 7% 5 12% 2 11%
Very Complex 0 0 0 0 0 0

Between 2004 and 2007, among the respondents of Feedback Leaflets, an average of 65 per cent had requested advance ruling certificates;16 per cent merger notification filings; and 18 per cent both. An average of 61per cent of respondents held discussions with the Merger Notification Unit prior to making a request; of those discussions, 90 per cent were identified as non- complex and 10 per cent identified as complex.

Table 11: Language 2004-2007
  2004-2005 2005-2006 2006-2007
# % # % # %
Served in language of Choice Yes 44 100% 41 100% 17 100%
No 0 0 0 0 0 0
Served in what language English English 41 95% 39 95% 14 82%
French 2 5% 2 5% 3 18%

All respondents were served in the language of their choice, with a large majority in English.

Based on the low return rates noted on page 16, the conclusions drawn from the returned Leaflets are not necessarily representative of the views of all clients of the Mergers Branch. In order for the Bureau to be able to improve service to stakeholders in response to this feedback form, higher return rates would be necessary. The Bureau will continue to provide a blank revised Feedback Leaflet with all merger notifications and/or ARC requests, and encourages all respondents to fill them out.

Conclusion

The Mergers Branch continues to make timeliness a priority. While service standards are just one measure, they do respond to stakeholders’ legitimate requirement for predictability, and represent a measure of timeliness that compares very favorably against other jurisdictions. The data shows that the Bureau is reviewing all mergers on a timely basis on any measure; moreover, and in particular the service standard15 is being met in the vast majority of filings.

The Bureau continues to strive to provide an efficient and effective merger notification and review process. As part of this process, the Bureau encourages respondents to fill out the Feedback Leaflets to provide immediate feedback following interaction with the Branch. More generally, the Bureau is committed to increasing its overall efficacy by listening to, and working with our stakeholders. By designing effective solutions to concerns, with input from our stakeholders, the Bureau is able to further refine and advance its practices. Additional comments will be sought from stakeholders at the consultation forum on June 12, 2007 in Toronto. At that time, the Mergers Branch will present material and seek stakeholder feedback on, among other matters, exemptions and potential amendments, efficiencies, the remedies study, our ex-post review work, and the Fee and Service Standards.

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Footnotes

1 A service standard represents the maximum time within which the Bureau will endeavour to provide a response.

2 The Fee and Service Standards Policy and the Fee and Service Standards Handbook can be found on the Bureau’s Web site ( www.competitionbureau.gc.ca ) under Business Services, Fees and Service Standards.

3 The October 2004 Merger Review Performance Report can be found on the Bureau’s Web site under Business Services, Fees and Service Standards ( www.competitionbureau.gc.ca )

4 The totals include the number of notifications or ARC requests received during the period of April 1 and March 31 of each year.

5 Excludes merger notification filings for which Advance Ruling Certificates were also requested.

6 Transaction-size threshold is met when the assets or target firm being acquired are valued over, or generated gross revenues from sales in or from Canada of over $50 million.

7 Refer to table 3 for a detailed list of major expenditures.

8 The Information Bulletin on Merger Remedies in Canada can be found on the Bureau’s Web site
( www.competitionbureau.gc.ca ) under News & Resources, Reports and Guidelines, Bulletins.

9 The Policy Statement for the Publication of Technical Backgrounders can be found on the Bureau’s Web site ( www.competitionbureau.gc.ca ) under News & Resources, Technical Backgrounders, Policy Statement for the Publication of Technical Backgrounders

10 Technical Backgrounders can be found on the Bureau’s Web site ( www.competitionbureau.gc.ca ) under News & Resources, Technical Backgrounders.

11 The totals include the number of notifications and ARC requests completed between April 1 and March 31 of each year.

12 3 days for non-complex cases, 2 weeks for complex cases and 3 weeks for very complex cases.

13 The Merger Review Benchmarking Report was published by the Bureau’s Compliance and Operations Branch in June 2001 after it conducted a thorough study of the Bureau’s merger review process. The report is available on the Bureau’s Web site under Merger Info, Publications.

14 Tables are based on the responses provided on the returned feedback leaflets for fiscal years 2004-2005, 2005-2006, and 2006-2007. All percentages were calculated based on total number of responses for each individual question.

15 See Table 6 for a complete list of percentage of filings where the service standard was met.

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