Under the Competition Act, mergers of all sizes and in all sectors of the economy are subject to review by the Commissioner of Competition to determine whether they will likely result in a substantial lessening or prevention of competition.
In general, mergers are viewed positively as a means to increase competitiveness, allowing Canadians to benefit from lower prices, product choice and quality services. However, the Bureau pays close attention to the small portion of mergers that could substantially prevent or lessen competition in particular markets.
In reviewing mergers, the Bureau considers many different elements, including the level of economic concentration in the relevant industry and the merging parties' market shares. If the Commissioner of Competition determines that the merger is likely to affect competition, he may apply to the Competition Tribunal for an order to prevent, dissolve or alter the merger. More information regarding the merger provisions of the Competition Act is contained in the Merger Enforcement Guidelines.
In addition, the Commissioner of Competition must be notified of all mergers that exceed certain size thresholds prior to completion. Failure to notify is a criminal offence.
All parties contemplating business mergers are strongly encouraged to contact the Competition Bureau at the earliest opportunity or before submitting a notification filing.
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