Immunity program: Frequently asked questions

This document supplements the Immunity Program under the Competition Act.

This document does not provide legal advice. Readers should refer to the Competition Act (Act) when questions of law arise and obtain legal advice if necessary. The Bureau may choose to depart from the approach set out in this document in exceptional circumstances.

This document applies to conduct that has already occurred. A party wishing to seek a binding written opinion from the Commissioner of Competition (Commissioner) on the applicability of the Act to proposed business conduct may do so under section 124.1 of the Act.Footnote 1

Step 1: Requesting an immunity marker

Q1 — What is an immunity marker?

An “immunity marker” is the confirmation given to an immunity applicant (Applicant) that it is the first party to approach the Competition Bureau requesting a recommendation of immunity with respect to criminal anti‑competitive activity involving a particular product or business interest. The immunity marker guarantees the Applicant’s place at the front of the line, subject to the Applicant meeting all of the other criteria of the Immunity Program.

Once an immunity marker is granted, the Applicant has a limited period of time, usually 30 calendar days, to provide the Bureau with a detailed statement describing the illegal activity, its effects in Canada and the supporting evidence. This statement is known as a “proffer” and is described in more detail in the responses to questions 17 and 19 below.

Q2 — For what offences is an immunity marker available?

An Applicant may request an immunity marker for anti‑competitive activities subject to sanction under the criminal competition provisions of the Act. Offences described in sections 45 to 49 of the Act, including conspiracy (sections 45 and 46) and bid-rigging (section 47), are handled by the Cartels Directorate. False or misleading representations and deceptive marketing practices (sections 52 through 55.1) are handled by the Deceptive Marketing Practices Directorate.

An Applicant may also request an immunity marker for such offences when liability arises from aiding or abetting any of these offences contrary to section 21 of the Criminal Code or counselling any of these offences contrary to section 22 of the Criminal Code.

As set out in paragraph 13 of the Immunity Bulletin and in the response to question 9 below, the Commissioner will recommend that immunity be granted to the first party to disclose to the Bureau an offence not yet detected or to provide evidence leading to a referral of evidence to the Public Prosecution Service of Canada (PPSC). Accordingly, only one immunity marker will be granted for each offence, regardless of whether liability arises directly from the Act or through the application of section 21 and/or 22 of the Criminal Code.

Q3 — Can a party request an immunity marker for an offence of obstruction or destruction of records or other things?

No. An immunity marker is not available for obstruction, for destruction of records or other things (collectively records), or for any offence under the Act other than those described in response to question 2 above. Instances of obstruction arising in relation to activity for which immunity is sought should be brought to the attention of the Bureau as soon as possible.

If an Applicant or any of the individuals within the scope of the Applicant’s immunity application engage in obstruction after requesting immunity, they risk expulsion from the Immunity Program and prosecution for both obstruction and the offence for which immunity was sought. Whether they will be expelled from the Immunity Program will be determined on a case-by-case basis having regard to all of the circumstances in question.

Q4 — Who can request an immunity marker?

An individual or an organization Footnote 2 can request an immunity marker. Typically, an Applicant’s counsel makes the contact with the Bureau.

Q5 — Can an Applicant tell others about its immunity marker request or immunity application?

As set out in paragraph 17 of the Immunity Bulletin, the Bureau requires that Applicants keep immunity applications confidential. Confidentiality helps to ensure that the integrity of the Bureau’s investigation is maintained, that evidence is not destroyed, and that targets of the investigation do not become prematurely aware of investigative steps.

An Applicant shall not disclose its application for an immunity marker and subsequent immunity, or any related information, to a third party, other than its counsel or agencies in foreign jurisdictions to which the Applicant has made similar applications for immunity or leniency, unless consent is first obtained from the Bureau. Depending on the circumstances, the Bureau may ask that the Applicant also obtain the consent of the PPSC.

The only exceptions to obtaining consent occur if the application is public, or if the Applicant is required by law to disclose the information, whether in Canada or elsewhere. An Applicant that believes that disclosure is required by law must give notice to the Bureau as soon as practicable after becoming aware of the disclosure requirement and consult with the Bureau on how to protect the interests of the Bureau’s investigation in light of the disclosure requirement.

An Applicant must advise the Bureau as soon as practicable of the identity of all third parties, other than its counsel, to whom its application for immunity has been disclosed, including the agencies in all foreign jurisdictions to which the Applicant has made similar applications for immunity or leniency.

If an Applicant or any of the individuals within the scope of the Applicant’s immunity application disclose the Applicant’s immunity application before obtaining consent or otherwise notifying the Bureau, they risk expulsion from the Immunity Program and prosecution for the offence for which immunity was sought. Whether they will be expelled from the Immunity Program will be determined on a case-by-case basis having regard to all of the circumstances in question.

Q6 — Are joint requests for immunity markers, and subsequent immunity, accepted?  

The Bureau generally will not consider joint requests—only one party per offence will receive an immunity recommendation under the Immunity Program. The Bureau may make an exception, for example, in the case of a joint request from companies that are affiliated, as defined in subsection 2(2) of the Act.

Q7 — Who should a party contact to request an immunity marker?

Immunity markers are granted by either the Deputy Commissioner of Competition (DC), Cartels Directorate or the Deceptive Marketing Practices Directorate. The response to question 2 above describes the offences that are handled by each directorate. Contact information is provided in Part I of the Immunity Bulletin. Applicants cannot rely on any alternative contact, for example, with a Bureau officer or other Bureau employee, in respect of its application to obtain an immunity marker.

It is recommended that immunity marker requests be made by telephone and that the Applicant clearly state that it is making an immunity marker call. The Applicant should ensure that all information is clearly stated and that it and the DC are in agreement that an immunity marker has been requested, on the date and time of the request and on the description of the relevant product or business interest. As soon as possible following the request, usually within a few days, the DC will advise the Applicant whether the requested immunity marker is available to the Applicant.

Q8 — Does the PPSC grant immunity markers?

No. The PPSC does not accept immunity marker calls or grant immunity markers to Applicants. Applicants cannot rely on contact with the PPSC to establish an immunity marker. Immunity markers are granted only by the relevant DC.

Q9 — Why is it important to be “first-in”?

The Bureau will grant an immunity marker, with respect to particular conduct, only to the first party to request immunity. Subsequent Applicants may seek a leniency marker under the Bureau’s Leniency Program, but will not be eligible for a recommendation of immunity by the Bureau to the PPSC, unless the first-in party ultimately does not qualify for immunity.

It is the Bureau’s view that maintaining the first-in approach encourages parties to apply for immunity as soon as possible and not wait for their co-offenders before reporting illegal activity to the Bureau. Parties should come forward as soon as they believe they are implicated in an offence to ensure their status as first-in to qualify for immunity.

Q10 — If a party is unsure that an offence has been committed, or what products are involved, should it request an immunity marker anyway?

Yes. Since time is of the essence, the Bureau encourages individuals and organizations to come forward and request an immunity marker as soon as they believe they may be implicated in an offence. If an Applicant later determines that it was not involved in an offence, it should notify the DC and withdraw its immunity marker.

Where an Applicant’s proffer provides insufficient information that it committed an offence, the Bureau will make no recommendation to the PPSC as to a grant of immunity and will request that the Applicant withdraw its immunity marker. In the event that the Applicant does not withdraw its immunity marker, the immunity marker will be cancelled by the DC following a minimum of 14 calendar days notice to the Applicant.

Q11 — Should a party request an immunity marker even if it does not sell products directly or indirectly into Canada?

A party should request an immunity marker if it believes that it has committed an offence in Canada, regardless of whether it sells products directly or indirectly into Canada. In this regard, cartel offences can arise, for example, where a party does not sell products into Canada as part of a market allocation agreement contrary to section 45 of the Act, or where a party agrees not to submit a bid in response to a call or request for bids or tenders contrary to section 47 of the Act.

Similarly, in the case of deceptive marketing practices, a party should request an immunity marker if it believes that it has, for example, engaged in deceptive telemarketing contrary to section 52.1 of the Act that targets consumers located outside Canada from call centres located in Canada.

Q12 — How does the Bureau treat immunity markers and recommendations for immunity in the context of investigations that it does not intend to further pursue?

The Bureau will not make a formal recommendation for immunity to the PPSC in cases where it does not intend to further investigate the alleged anti‑competitive conduct. In these situations, the Bureau will advise the Applicant of the scope of the formal recommendation for immunity that it otherwise would have made to the PPSC if the investigation had continued. This will be done verbally, unless the Applicant requests that it be done by way of letter.

If the Bureau subsequently decides that it will investigate the alleged anti‑competitive conduct, it will advise the Applicant and take steps to recommend that immunity be granted as previously described to the Applicant, provided that the organizations and/or individuals that would be covered by the recommendation for immunity continue to meet the conditions of the Immunity Program.

Q13 — Is it true that all immunity cases are international cases?

No. The Immunity Program applies equally to domestic and international conspiracies and the Bureau has, on a number of occasions, recommended immunity in respect of both domestic and international cartels. The Bureau has also recommended immunity in respect of deceptive practices that target both the domestic and international markets.

Q14 — What kind of information is the Bureau looking for at the immunity marker stage?

The Bureau requires sufficient information to determine whether an Applicant is first-in under the Immunity Program. It does this by comparing the conduct and product description provided by the Applicant to information already in the Bureau’s possession. This enables the Bureau to determine whether another party has requested an immunity marker for the same conduct and product.

For this reason, it is imperative that the Applicant, when identifying the offence, provide a precise product definition, including a description of any sub-products that may be covered within the scope of the immunity marker request, as well as the time period for the conduct in question. In some circumstances, the Bureau may request more detailed information regarding the offence, the geographic market or the other parties involved to assist it in the determination of whether the requested immunity marker is available.

Q15 — Can the information provided to secure an immunity marker be hypothetical?

Yes. An Applicant may provide information on a hypothetical basis at the immunity marker request stage—it is not required to reveal its identity to obtain an immunity marker. At this stage, information is often provided by an Applicant’s counsel. However, once an immunity marker is granted, the Applicant will need to identify itself to facilitate the Bureau’s preparations for the Applicant’s proffer and the Bureau’s investigation.

Q16 — Can immunity markers lapse or be cancelled by the Bureau?

If an Applicant fails to provide its proffer within 30 calendar days after an immunity marker has been granted, or within any extended period of time agreed to by the DC, the Applicant’s immunity marker will automatically lapse. The Applicant’s immunity marker will also automatically lapse at the end of this period if the Applicant provides a proffer and is subsequently informed by the Bureau that the proffer is incomplete or otherwise insufficient and it has not obtained an extension from the DC.

There is no obligation on the DC to notify the Applicant that its immunity marker has lapsed in such circumstances. Rather, it is the Applicant’s responsibility to seek an extension from the DC in such cases. For information on how to request an extension, see the response to question 22 below.

The DC may also cancel an immunity marker if the Applicant fails to meet any of the other requirements of the Immunity Program. The decision to cancel an immunity marker will be made only after serious consideration of all factors and a minimum of 14 calendar days notice to the Applicant.

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Step 2: The proffer stage

Q17 — What is a proffer?

After receiving an immunity marker, an Applicant must provide the Bureau with a statement known as a proffer. In a proffer, an Applicant describes in detail the illegal activity, its role in the offence for which immunity is sought, and the effect of the illegal activity in Canada. The Applicant must also outline all of the supporting evidence and witnesses that it can provide at that point in time as part of its cooperation under the Immunity Program. Proffers are generally provided on a “without prejudice” basis by an Applicant’s counsel.

Q18 — When should a proffer be made?

An Applicant should make and complete its proffer as soon as possible after receiving its immunity marker, typically within 30 calendar days after the immunity marker has been granted by the DC. The DC will discuss timing requirements with an Applicant during the immunity marker call. The timing of a proffer can affect other steps in the Bureau’s investigation, such as the execution of a search warrant or cooperation with another jurisdiction, where timing can be critical. In certain circumstances, the Bureau may require the Applicant to make its proffer early within the 30 calendar day period.

Q19 — What kind of information should be provided at the proffer stage?

At the proffer stage, an Applicant must provide a description of the illegal activity for which immunity is sought and outline all of the information it has at that point in time relating to that activity. Accuracy is critical. The Bureau relies on the information provided to assess the immunity application, to make its recommendation for immunity to the PPSC and to pursue its investigation of other parties to the offence.

At the proffer stage, the Bureau will not accept a bare outline of the conduct or speculation as to the Applicant’s role. The Bureau requires the details of the Applicant’s role and sufficient information to obtain a clear appreciation of the evidence each witness identified by the Applicant can provide about the conduct. Applicants should report as completely and accurately as possible with truthfulness and in a spirit of cooperation.

Applicants have a positive obligation to update their proffered information as they become aware of either new or corrected information. This must be done promptly and on an ongoing basis, regardless of whether or not the Bureau has specifically asked for the information.

Topics to be covered in a proffer may include those set out below. This list is not intended to be exhaustive and the information required will depend on the facts and the relevant offence. For example, evidence of an undue lessening of competition will be required in the case of a conspiracy where some of the conduct pre-dates March 12, 2010 (when the current conspiracy provision came into force). Other information, such as the use of deceptive telemarketing scripts, is likely to be relevant only in the context of false or misleading representations and deceptive marketing practices.

The parties

  • a general description of the Applicant and the other parties implicated in the conduct;
  • the individuals involved in the offence;
  • business ownership structures, including affiliations;
  • the Applicant’s share of, and role in, the market;
  • membership in, or involvement with, trade or other associations;
  • the nature and level of involvement in the offence;

The product

  • the physical and technical characteristics of the product;
  • quality claims;
  • the end use and value of the product;

The industry

  • a general description of the industry and how it functions;
  • how pricing in the industry works;
  • the regulatory framework;
  • the existence and nature of contracts;
  • how the product is supplied;
  • customer or supplier countervailing power;
  • use of targeted lists by telemarketers;

Market information

  • other market participants (domestic or foreign) and their market shares;
  • a description of key customers in Canada and elsewhere;
  • the geographic locations of sellers and customers;

Required if the conduct pre-dates March 12, 2010, and the offence requires proof of undueness:

  • any product substitutes and their price levels (including transportation costs);
  • barriers to entry into the market;
  • costs for a customer to switch to an alternate product;

The Conduct

  • a description of the conduct, including the nature and timing of communications among competitors or corporate policies or procedures designed to deceive customers;
  • the time period of the conduct;
  • the geographic scope of the conduct;
  • the representations involved and the medium;
  • monitoring or enforcement measures utilized in carrying out the offence;
  • whether any agreements or arrangements were set out in writing;
  • whether other participants continue to engage in the conduct;
  • measures taken to conceal the conduct or the identity of the participants;
  • measures taken to launder money;
  • re-loading (or re-victimizing) customers;
  • selling of customer lists;
  • targeting vulnerable groups;
  • abusive or threatening behaviour relating to the offence;

Impact of the conduct

  • the volume of commerce affected in Canada, whether directly or indirectly, along with a description of the methodology, data and sources used to make or support that determination;
  • pricing and other effects;
  • whether customers or potential customers are aware of the conduct or have complained about it;

Evidentiary process

  • a general description of witnesses who the Applicant believes could testify about the conduct and the anticipated nature of their evidence;
  • a description of all relevant records available to the Applicant at that point in time;
  • identification of any relevant records or witnesses that are unavailable and the reasons for the unavailability, including specifics of any evidence destruction or attempts to obstruct the investigation;

International issues

  • whether the Applicant has made, or will make, an application for immunity or leniency in other jurisdictions and the identity of those jurisdictions; and

Private actions

  • whether the Applicant is a defendant in any civil actions in Canada, or elsewhere, respecting the conduct and the general status of any such civil actions.

Q20 — At what point will the Bureau consider an Applicant’s proffer to be complete?

The Bureau considers a proffer to be complete when it has received sufficient information to make an immunity recommendation to the PPSC. At the request of the Bureau, the Applicant must advise the Bureau, in a manner that does not waive any legal privilege, of the progress of its internal investigation so that the Bureau can determine if information may be lacking. The Bureau expects that Applicants will continuously provide any new information they become aware of to the Bureau and that Applicants will provide timely responses to any questions the Bureau may have.

Q21 — What happens after a proffer has been provided and found to be complete?

After an assessment of an Applicant’s completed proffer, the Bureau will present the information to the PPSC with a recommendation as to whether the PPSC should enter into an immunity agreement with the Applicant. While the PPSC will give the Bureau’s recommendation due consideration, the PPSC has final independent authority to decide if it will enter into an immunity agreement with an Applicant.

Depending on the circumstances, the Bureau may require further information, including evidence in the form of records or interviews with the Applicant’s proffered witnesses, to complete its immunity recommendation or pursue other investigative steps, such as search warrant applications. Any records provided to the Bureau at this stage are treated as confidential or privileged. The Bureau will not return records to the Applicant.

Q22 — What if an Applicant cannot meet the 30 calendar day deadline? Will the immunity marker lapse or be cancelled?

If an Applicant believes that it is incapable of completing its proffer within 30 calendar days, it must communicate this fact and the reasons for the delay to the DC as soon as possible. The Applicant should be prepared to provide the DC with information on the status of its internal investigation, a detailed proposed workplan for completing its proffer, and an update on the status of its cooperation with other agencies.

The DC will then decide whether any delay in cooperation is reasonable and, where appropriate, establish a revised schedule for delivery of the proffer. Where the DC has particular concerns with an Applicant’s timing, the DC may request an undertaking from the Applicant that it will provide the information by a specified date, together with an acknowledgement that its immunity marker will automatically lapse if the undertaking is not fulfilled.

A delay may be warranted in complex cases, particularly where multiple jurisdictions are involved and information is difficult to gather or where a key witness is unavailable. The Bureau will not accept delays solely because an Applicant has commitments arising out of immunity or leniency applications in other jurisdictions or because the Applicant’s counsel is unavailable. Applicants should alert the Bureau to any impediments to complying with the Bureau’s required schedule as early in the process as possible to avoid prejudice to the Bureau’s investigation.

In the absence of an extension to complete the proffer, delays may result in the automatic lapsing of the Applicant’s immunity marker.

Q23 — What is undueness in a conspiracy case? Does an Applicant have to show undueness to qualify for immunity?

Prior to March 12, 2010, section 45 of the Act prohibited agreements that prevent or lessen competition unduly or enhance prices unreasonably. A conspiracy under the previous provision must meet the threshold of undueness or unreasonableness before it can be considered a criminal offence. It is the combination of market power and behaviour likely to injure competition that makes a lessening of competition undue.

The determinants of market power include such factors as market shares, the number of competitors and the concentration of competition, barriers to entry, geographical distribution of buyers and sellers, differences in the degree of integration among competitors, product differentiation, countervailing power and cross-elasticity of demand. When parties engage in particularly injurious behaviour contrary to the former section 45 of the Act, such as price-fixing, liability may be triggered even when market power is not considerable.Footnote 3

Market information provided by an Applicant at the proffer stage enables the Bureau to assess the likely impact of the agreement and whether it has caused an undue lessening of competition. Applicants are required to address the issue, but are not required to demonstrate decisively to the Bureau that an undue lessening of competition has occurred in the case of conduct that pre-dates March 12, 2010.

The current conspiracy provision under the Act is a per se offence that does not require proof that the agreement unduly prevented or lessened competition. The same applies to other offences, including bid-rigging and false or misleading representations.

Q24 — What is materiality in a false or misleading case? Does an Applicant have to show materiality to qualify for immunity?

Section 52 of the Act prohibits a person from making a materially false or misleading representation to the public for the purpose of promoting a product or business interest. Similarly, section 52.1 of the Act prohibits such representations from being made while telemarketing. Generally stated, a representation is material if it would be likely to influence a person.

At the proffer stage, Applicants are required to provide information regarding the representation made, the manner in which it was conveyed and the product or business interest being promoted. Although not required to demonstrate decisively to the Bureau that the false or misleading representation was material, Applicants are required to provide all information available at that point in time that addresses the issue. The Bureau will assess the general impression created by the representation and whether it is material.

Q25 — Are both written and oral proffers accepted?

Yes. The Bureau accepts both oral and written proffers. The Bureau is sensitive to the concerns of Applicants about written proffers and other exchanges and, as a result, it has developed a “paperless process” when dealing with Applicants.

In oral proffers, Bureau staff take detailed notes of the information. Applicants should take special care in an oral proffer to ensure that all information is clearly stated in a manner that allows sufficient time for note-taking and that counsel for the Applicant and the Bureau officers are in agreement regarding the information provided. Accuracy is critical since the Bureau relies on the information to assess the immunity application, to develop its immunity recommendation and to pursue its investigation. As described in the response to question 17 above, proffers are generally provided by an Applicant’s counsel on a “without prejudice” basis.

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Step 3: Immunity agreement

Q26 — What is an immunity agreement?

An immunity agreement is an agreement between the Director of Public Prosecutions (DPP) and an Applicant setting out the terms and conditions under which the DPP grants the Applicant immunity from prosecution. The agreement sets out the Applicant’s obligations to provide complete, timely and ongoing cooperation and full, complete, frank and truthful disclosure throughout the Bureau’s investigation and any subsequent prosecutions. It also states who is covered by the agreement, how information provided by the immunity recipient will be treated and under what circumstances the agreement can be revoked.

Both the Applicant and the DPP must sign the agreement. The Commissioner also signs the agreement for the purpose of giving effect to the Commissioner’s rights and obligations as set out in the agreement. Unofficial sample corporate and individual template agreements are available on the Bureau’s website.Footnote 4

Q27 — When is the immunity agreement signed?

The Bureau must be satisfied that the Applicant meets the requirements of the Immunity Program. After receiving sufficient information from the Applicant, typically in the form of a proffer, the Bureau will present the relevant information to the PPSC with a recommendation as to whether or not the PPSC should grant immunity to the Applicant. In some cases, the Bureau may request an interview with one or more witnesses, or an opportunity to view certain records, before making a recommendation to the PPSC. If the PPSC accepts the Bureau’s recommendation to grant immunity, the DPP will sign an immunity agreement with the Applicant. The PPSC has independent discretion in these matters.

Step 4: Full disclosure

Q28 — What information is an Applicant required to provide the Bureau after entering into an immunity agreement?

As set out in paragraph 17 of the Bulletin, an immunity agreement requires that an Applicant provide complete, timely and ongoing cooperati on throughout the course of the Bureau’s investigation and any subsequent prosecutions.

After an Applicant enters into an immunity agreement with the DPP, the Applicant must complete the full disclosure process. The Bureau requires full, complete, frank and truthful disclosure of all non-privileged information, evidence or records in the Applicant’s possession, under its control or available to it, wherever located, that, in any manner, relate to the anti‑competitive conduct.

Applicants will be expected to provide all records and other evidence to the Bureau on a timely basis and witnesses will be expected to be interviewed at the Bureau’s request. Applicants are expected to take all lawful measures to secure the cooperation of current directors, officers and employees, as well as any agents or former directors, officers or employees covered by the immunity agreement, and to facilitate their ability to appear for interviews and provide testimony in judicial proceedings at the Applicant’s expense. Before communicating any information regarding the investigation to an agent or a former director, officer or employee, the Applicant must seek the consent of the Bureau or the PPSC.

At the full disclosure stage, the topics addressed by an Applicant will generally be the same as those addressed at the proffer stage (see the responses to questions 19, 23 and 24 above), but will be covered in greater detail. The Bureau will want to view and obtain copies of records and interview witnesses. These interviews will, at the discretion of the Bureau, be under oath and recorded on video or audio tape. The full disclosure process can be expensive and time-consuming, and the Applicant must be prepared to dedicate the appropriate resources to support the Bureau’s interest in conducting an expeditious and thorough investigation.

Applicants have a positive obligation to update all information and evidence promptly as they become aware of either new or corrected information, records or witnesses. This must be done on an ongoing basis regardless of whether or not the Bureau has specifically asked for the information.

Accuracy of the information provided is critical to the Bureau. The Bureau relies on this information to pursue its investigation of other participants to the alleged offence. Because timelines in an investigation can be critical, an Applicant’s lack of timely cooperation can jeopardize the Bureau’s investigation. An Applicant that provides false or misleading information to the Bureau or fails to fully cooperate in accordance with its obligations under the immunity agreement may face revocation of the immunity agreement.

The party may also face a criminal charge of obstructing a Bureau inquiry or examination under section 64 of the Act or of destroying or altering records under section 65 of the Act. Providing false or misleading information can also lead to charges, including perjury or obstruction, under the Criminal Code.

Q29 — How soon do witnesses and records need to be made available after immunity is granted?

An Applicant is required to provide complete, timely and ongoing cooperation to the Bureau and the PPSC, at its own expense, throughout the Bureau’s investigation and any subsequent prosecutions. Except for an exceptional circumstance, this means that the Applicant must make records and witnesses available as soon as practicable after the immunity agreement is signed.

The Bureau will often want to schedule interviews with key witnesses very soon after an immunity agreement is signed. Relevant records may be used in witness interviews and, when requested by the Bureau, should be provided to the Bureau by the Applicant at least two weeks before an interview.

Typically, a schedule for disclosure is established by the Bureau early in the immunity process and production of information and records completed within the disclosure period, normally within a six-month timeline. Unwarranted delays or failure to provide access to witnesses arising from other commitments, including those commitments that arise from immunity or leniency applications in other jurisdictions, may be considered by the Bureau to be a breach of the immunity agreement.

The objective of the Immunity Program is to stop illegal activity by the Applicant and to obtain information that can be used to detect, investigate and prosecute other participants in the illegal activity. Timing is critical to the Bureau’s enforcement interest and, in particular, to locating evidence as quickly as possible and coordinating investigatory steps with other jurisdictions.

Q30 — Will the Bureau discuss its expectations regarding record production with the Applicant?

Yes. Before providing records to the Bureau, the Applicant must consult with the Senior Competition Law Officer assigned to the file with respect to their relevance and scope, as well as with respect to the form in which they will be provided. Relevant records must be provided in an organized fashion that clearly indicates evidence of an offence. The Bureau does not need or want records that are not relevant to the offence—“record dumps” are not acceptable under the Immunity Program. Applicants are required to discuss their record production with the Bureau on an ongoing basis and to raise any concerns or challenges early in the process.

Q31 — Do records have to be produced in a certain format?

Yes. The Bureau typically requires that records be produced in electronic format. Applicants must always discuss the general technical requirements with the Senior Competition Law Officer assigned to the file. In many instances, it will be necessary to arrange for direct contact between the technical experts for each side to discuss any issues.

Q32 — What if the Applicant’s records are in a language other than one of Canada’s two official languages (English and French) or if a witness does not effectively communicate in one of Canada’s two official languages?

When requested by the Bureau or the PPSC, the Applicant is expected to produce professionally translated records and to arrange for a professional interpreter to accompany its witnesses where necessary. Neither the Bureau nor the PPSC will bear the cost of translation or interpretation.

Q33 — What happens if a witness refuses to cooperate with the Bureau’s investigation?

Paragraphs 20 and 21 of the Immunity Bulletin provide that current directors, officers and employees will qualify for the same grant of immunity as their organization if they provide complete, timely and ongoing cooperation. Agents and former directors, officers and employees may also qualify for the same grant of immunity on a case-by-case basis.

The cooperation required from such individuals, as set out in paragraph 17 of the Immunity Bulletin, includes, among other things, an obligation to provide full, complete, frank and truthful disclosure of all non-privileged information, evidence or records in their possession, under their control or available to them, wherever located, that in any manner relate to the anti‑competitive conduct. There must be no misrepresentation of any material facts.

If a witness refuses to provide complete, timely and ongoing cooperation with the Bureau’s investigation, the Bureau may make a recommendation to the PPSC that the witness be excluded from the immunity agreement and face prosecution. Typically, the Bureau will discuss the situation with the witness and provide the witness with a reasonable opportunity to cooperate with the Bureau’s investigation before making such a recommendation to the PPSC. The PPSC may, as a result of the Bureau’s recommendation, or on its own initiative, exclude the witness from the immunity agreement.

No current director, officer or employee, and no agent or former director, officer or employee covered by an immunity agreement, will be carved out of an immunity agreement for any reason other than a failure to admit its knowledge of or participation in the conduct or a failure to cooperate in a complete, timely and ongoing manner.

Q34 — Are witnesses required to travel to Canada?

Yes. Witnesses for an Applicant must travel to Canada or another mutually convenient location to be interviewed by the Bureau, unless special circumstances justify an alternate arrangement to which the Bureau must agree. Organizations applying for immunity are required to cover their own expenses and the expenses of any and all witnesses who are covered by the immunity agreement.

Q35 — Can the information an Applicant provides as full disclosure be used against it?

As described in paragraph 26 of the Immunity Bulletin, the full disclosure process will be conducted on the understanding that neither the Bureau nor the PPSC will use the information against the Applicant or its individuals, unless the Applicant fails to comply with the terms and conditions of its immunity agreement. An Applicant’s continuing obligations under an immunity agreement are described in the response to question 28 above.

Q36 — Can an immunity agreement be revoked?

Yes. As set out in Part F of the Immunity Bulletin, the failure of an Applicant to comply with any of the terms and conditions in its immunity agreement may result in revocation of the agreement.

Where the Bureau becomes aware that an Applicant does not meet or has not met the terms and conditions set out in its immunity agreement, the Bureau may make a recommendation to the PPSC that the Applicant’s immunity be revoked. Typically, the Bureau will discuss the situation with the Applicant and provide an opportunity to the Applicant to address any shortfalls in its conduct as quickly as possible before making a recommendation for revocation to the PPSC.

As a result of the Bureau’s recommendation, or on its own initiative, the PPSC may revoke an immunity agreement where the Applicant does not meet all of the terms and conditions of that agreement, and take further action against the Applicant as appropriate in the circumstances. Where the PPSC determines that the Applicant has failed to fulfil the terms and conditions set out in its immunity agreement, the PPSC will provide a minimum of 14 calendar days notice to the Applicant so that it has an opportunity to remedy its failure before revoking the immunity agreement.

The PPSC’s policy on immunity, including the approach it will take when an agreement is breached, is set out in the Federal Prosecution Service Deskbook.Footnote 5

Q37 — If an organization loses immunity, will its directors, officers, employees and agents who are covered by the agreement also lose their immunity?

Revocation of immunity will affect only the individual or organization that is not cooperating or that otherwise fails to comply with the immunity agreement. An organization’s coverage under an immunity agreement can be revoked while its cooperating directors, officers, employees or agents who are covered under the agreement retain their protection. Likewise, it is possible for an individual’s coverage under an immunity agreement to be revoked while the individual’s organization remains covered.

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Other

Q38 — To qualify for immunity, an Applicant is required to stop participating in the conduct in question, but doing so may alert other parties to the offence that the Applicant has approached the Bureau and this may affect the Bureau’s investigation. What should the Applicant do?

Applicants are required to stop participating in the illegal activity to qualify for immunity. At the earliest opportunity, Applicants should raise with the Bureau any concerns they have about what they can or cannot do to comply with this requirement and the possible impact that non-compliance could have on the Bureau’s investigation.

Q39 — Securing the cooperation of directors, officers, employees and agents may alert other parties to the offence that the Applicant has approached the Bureau and this may affect the Bureau’s investigation. What should the Applicant do?

Organizations should conduct an internal investigation of the illegal activity and secure the cooperation of potential witnesses in a manner that is consistent with confidentiality obligations under the Immunity Program. At the earliest opportunity, and before taking specific steps, Applicants should raise with the Bureau, and if necessary the PPSC, any concerns they have about confidentiality and the possible impact this could have on the Bureau’s investigation.

Q40 — How do you determine if a party has coerced others to be party to the illegal activity?

Paragraph 15 of the Immunity Bulletin states that to qualify for immunity the party must not have coerced others to be party to the illegal activity.

The Bureau will disqualify a party only where there is clear evidence of coercive behaviour. In particular, where there is evidence that the party pressured unwilling participants to be involved in the offence, the party will not qualify for immunity. The coercion may be either express or implied.

Q41 — When would a party be disqualified under paragraph 16 of the Immunity Bulletin?

Paragraph 16 of the Immunity Bulletin provides that where the party requesting immunity is the only party involved in the offence, it will not be eligible for immunity.

Certain offences under the Act may be carried out by only one organization. For example, the offence of false or misleading representations may be committed by one organization and be intended for the sole benefit of t hat organization. These offenders are ineligible for immunity in light of paragraph 16 of the Immunity Bulletin. While an organization acting alone may not be eligible for immunity as a result of this provision, its directors, officers or employees are encouraged to apply for individual immunity.

A grant of immunity to a sole participant in an offence is of no benefit to the Bureau, as there is no other party to investigate. Individuals employed by an organization ineligible as a result of paragraph 16 may be separately eligible under the Immunity Program, as their admissions and evidence may further an investigation of the organization. They are encouraged to apply for immunity through separate counsel.

Q42 — What previous offences must be disclosed?

Paragraph 17 of the Immunity Bulletin provides that throughout the course of the Bureau’s investigation and subsequent prosecutions, the Applicant must provide complete, timely and ongoing cooperation. In particular, paragraph 17(b) requires that the Applicant must reveal to the Bureau and the PPSC any and all conduct of which it is aware, or becomes aware, that may constitute an offence under the Act in which it may have been involved. A number of questions have been raised regarding what an Applicant is required to disclose pursuant to this provision.

The Bureau requires Applicants to disclose all criminal offences under the Act of which they are aware and that relate to any product or business interest. Applicants will be expected to exercise reasonable due diligence in determining whether they have been involved in other criminal offences under the Act. Disclosure of the offences should be made as soon as possible after an immunity application and will be required before the Bureau recommends that the DPP sign an immunity agreement with the Applicant.

Offences uncovered after the signing of the agreement must be brought to the attention of the Bureau and the PPSC at the earliest possible time. The Immunity, Immunity Plus and Leniency Programs may apply to the additionally disclosed conduct. For a description of the Immunity Plus Program, see the response to question 43 below.

The Bureau may recommend increased penalties for criminal offences under the Act that the Applicant should have discovered through its due diligence efforts and disclosed. Revocation of immunity may be justified where the Applicant knew of and failed to disclose those other offences. The Bureau will also recommend increased penalties in these circumstances to address the multiple offences as an aggravating factor in sentencing.

Applicants should also anticipate that witnesses will be asked about any criminal activity, under any legislation, that can reasonably be expected to impact their credibility as a witness. Before offering immunity, it is essential that counsel for the PPSC be satisfied that the Applicant has disclosed all the information likely to affect its credibility. Such disclosure may relate to criminal activity in Canada or abroad.

Paragraph 17 of the Immunity Bulletin requires parties to provide full, complete, frank and truthful disclosure and prohibits misrepresentation of any material facts. An Applicant that provides false or misleading information to the Bureau in the context of an immunity application and/or during the performance of related obligations may be considered ineligible for immunity and face revocation of its immunity agreement.

It could also face a criminal charge of obstruction under section 64 of the Act, or of destroying or altering records under section 65 of the Act. Providing false or misleading information under oath can lead to charges, including perjury or obstruction, under the Criminal Code. Applicants remain at risk of being prosecuted for any undisclosed criminal offences and will not be eligible for either the Immunity Program or the Immunity Plus Program (described below) in relation to that conduct.

Q43 — What is Immunity Plus?

Parties that are not first to disclose conduct to the Bureau may nevertheless qualify for immunity if they are first to disclose information relating to another offence. This concept is known as “Immunity Plus”. Immunity Plus may be available in situations such as the following: Organization ABC is not the first to disclose the pencils cartel to the Bureau and therefore does not qualify for immunity for pencils. However, ABC does disclose information relating to a different offence unknown to the Bureau, one involving a different product, for example, a cartel with respect to erasers.

ABC will be granted immunity for the cartel on erasers, subject to compliance with the requirements set out in the Immunity Program. If ABC pleads guilty to the cartel related to pencils, the value of ABC’s contribution to the investigation of the pencils cartel and the disclosing of the eraser cartel will be recognized by the Bureau and the PPSC in their sentencing recommendations with respect to the pencils cartel. For further information concerning sentencing recommendations, please consult the Bureau’s Leniency Program, available on its website.Footnote 6

Immunity Plus encourages targets of ongoing investigations to consider whether they may qualify for immunity in other markets where they compete. Although an organization may not qualify for immunity for the initial matter under investigation, the value of its assistance in a second matter can lead to immunity for the second offence and a reduction (thus the “Plus”) in the calculation of the recommended sentence for its participation in the first offence. Immunity Plus is aimed at encouraging companies already under investigation to report the full extent of their illegal activities and put all competition law matters behind them.

Where an Applicant qualifies for a recommended Immunity Plus discount, the Bureau will typically recommend that an additional five to 10 percent be added to the Applicant’s leniency discount. The size of the recommended Immunity Plus discount will depend on a number of factors relating to the conduct for which immunity is available. These factors include the strength of the evidence provided by the Applicant and the estimated significance of the case it brought forward, measured in such terms as the affected volume of commerce in Canada; the geographic scope of the conduct in question; and the number of co-conspirator organizations and individuals involved in the conduct in question. This discount will be applied only where all conditions of cooperation under the Immunity Program and Leniency Program are met by the Applicant.

Q44 — Will the identity of an Applicant be disclosed to the public?

The Bureau treats the identity of an Applicant as confidential. Paragraph 31 of the Bulletin states that the only exceptions to this policy are where:

  • disclosure is required by law;
  • disclosure is necessary to obtain or maintain the validity of a judicial authorization for the exercise of investigative powers;
  • disclosure is for the purpose of securing the assistance of a Canadian law enforcement agency in the exercise of investigative powers;
  • the party has agreed to disclosure;
  • there has been public disclosure by the party; or
  • disclosure is necessary to prevent the commission of a serious criminal offence.

The Bureau also treats as confidential information obtained from a party requesting immunity, subject only to the exceptions listed above, or where disclosure of such information is otherwise for the purpose of the administration or enforcement of the Act. Typically, the identity of an Applicant will remain confidential until charges are laid against other participants to the offence and disclosure of the Crown’s case to the accused is required.

Applicants should be aware, however, that their identity may be disclosed before charges are laid if the Bureau relies on their evidence in an application to a Canadian court for a search warrant, production order or judicial authorization of another investigative measure. Recourse to search warrants and production orders, among other things, can be of utmost importance to an investigation. To obtain court authorizations, the Bureau must provide the court with information that there are reasonable grounds to believe that an offence has been, or will be, committed. The Bureau will rely on the information provided by the Applicant to establish these grounds.

The Bureau will not allow an Applicant’s interest in maintaining confidentiality to jeopardize the Bureau’s ability to effectively enforce the Act. However, the Bureau will take all reasonable steps to ensure that this type of early disclosure does not occur, except where necessary. The Bureau will draft applications to the courts for authorization of investigative powers, referred to as “Informations to Obtain” (ITOs), in a manner designed to secure the protection of an Applicant’s identity, unless the Bureau is of the view that such drafting would not reveal sufficient grounds required to obtain the authorization requested.

If the identity of the Applicant cannot be kept confidential when the Bureau applies for such authorization, it will request that the ITO, or relevant portion thereof, be sealed until charges are laid. If a party challenges the sealing order before a court to access the ITO, the Bureau will recommend to the PPSC that it resist the disclosure of the Applicant’s identity and provide a redacted version of the ITO, with the identity of the Applicant kept confidential, unless the court orders otherwise. Where it appears likely that disclosure is unavoidable, the Bureau will advise the Applicant as soon as possible.

Q45 — Will the Bureau pursue an Applicant under the civil provisions of the Act?

The Bureau will not commence civil proceedings against an Applicant in relation to the same or substantially the same facts that formed the basis of its immunity application in relation to the criminal provisions of the Act. In this context, the Bureau will treat the Applicant in the same manner as if it had pleaded guilty to the offence for which it received immunity.

Q46 — Will information provided by an Applicant be shared with foreign law enforcement agencies?

As set out in paragraph 33 of the Immunity Bulletin, the Bureau will not disclose the identity of an Applicant or the information obtained from that Applicant to any foreign law enforcement agency without the consent of the Applicant. This confidentiality protection is an added benefit afforded to Applicants under the Bureau’s Immunity Program.

It is important to note, however, that as part of an Applicant’s ongoing cooperation, absent compelling reasons, the Bureau will expect a waiver allowing communication of information with jurisdictions to which the Applicant has made similar applications for immunity or leniency. Such waivers are to be provided immediately and are expected to cover both substantive and procedural information.

Q47 — Can foreign counsel represent an Applicant before the Bureau or must a Canadian lawyer be involved?

Typically, a Canadian lawyer represents the Applicant in its dealings with the Bureau, although foreign counsel may be present at certain meetings. When in Canada, foreign counsel must ensure that they are acting in accordance with the requirements of the relevant provincial law society or bar association.

Q48 — What about an Applicant’s obligations as a member of a joint defence agreement in a civil action?

An Applicant’s first obligation is to provide complete, timely and ongoing cooperation to the investigation and prosecution of the offence for which immunity is sought.

Arrangements entered into in respect of a coordinated defence to a civil action must be subordinate to the overriding commitment owed under the Immunity Program and the terms of the immunity agreement. Moreover, the Applicant must keep the Bureau and the PPSC apprised on an ongoing basis of the general status of any civil action in which it is involved.

Q49 — Can an Applicant provide early disclosure in a civil action to obtain credit for cooperation?

The Bureau has no interest in forestalling cooperation, or in penalizing an Applicant for cooperating in a civil action. In the event that an Applicant wishes to cooperate with a civil litigant in exchange for “credit” in respect of any civil liability that may be owed, this interest should be communicated as early as possible to the Bureau and the PPSC. This will enable the Bureau and the PPSC to determine how the Applicant might provide cooperation in the civil action without jeopardizing the Bureau’s criminal investigation or the PPSC’s prosecution. Failure by an Applicant to advise the Bureau and the PPSC of its activities in this regard may jeopardize the Applicant’s status under the Immunity Program.

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Footnotes

Footnote 1

A written opinion provided under section 124.1 of the Actis binding on the Commissioner if all of the material facts have been submitted by or on behalf of an applicant for an opinion and such facts are accurate. For more information on binding written opinions, including the Bureau’s fees and service standards for the preparation of such opinions, please see: Competition Bureau, Competition Bureau Fees and Service Standards Handbook for Written Opinions (Ottawa: Industry Canada, May 18, 2011) and Competition Bureau, Competition Bureau Fees and Service Standards Handbook for Mergers and Merger-Related Matters (Ottawa: Industry Canada, Effective November 1, 2010).

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Footnote 2

As defined in the Criminal Code, the word “organization” may refer to a public body, a body corporate, a society, a company, a firm, a partnership, a trade union or a municipality. It may also refer to an association of persons that is created for a common purpose, that has an operational structure and that holds itself out to the public as an association of persons.

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Footnote 3

R. v. Nova Scotia Pharmaceutical Association, [1992] 2 S.C.R. 606.

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Footnote 4

See Individual Immunity Agreement and Corporate Immunity — Agreement.

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Footnote 5

The Federal Prosecution Service Deskbook.

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Footnote 6

The Leniency Program.

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