Corporations exist to make money for their share-holders. Period. Any so-called altruistic program would only ever be advanced by a corporation solely if it meets with their marketing plan.

Corporations, Edward Coke (1522-1634) once wrote, have no souls.

Because of this, while a free market society has produced incredible advantages to each and every member of society, it is a jungle out there. When a larger corporation meets a smaller competitor on the jungle path, it will eat the smaller if it can.

That kind of mindless, soulless behaviour is not always good for the consumer who benefits the most from competition.

"Antitrust laws … are the Magna Carta of free enterprise.  They are as important to the preservation of economic freedom and our free-enterprise system as the Bill of Rights is to the protection of our fundamental personal freedoms.”1

As Lawrence Sullivan wrote:

"The general objective of antitrust laws is the maintenance of competition. Competition per se becomes a goal of the legal order."

Stepping into a skirmish between two soulless (but not mindless) dividend-seeking creatures can be like refereeing a street fight; get in and get out.

competition balance

It is a tough area for the involvement of law as the danger is losing the baby with the bath water; of stifling healthy competitive conduct in the hunt for abusive competitive conduct.

From this ongoing tug of war has emerged what, in the United States of America is known as antitrust law, and most other jurisdictions such as Canada and Australia refer to it as competition law. In Australia, the statute is called the Competition and Consumer Act 2010. In the European Union, many of the regulations refers to anti-trust but most of the regulatory offices to competition. For example, the Competition Directorate-General and the European Competition Network. The United Kingdom's agency is the Office of Fair Trading.

But regardless of the nomenclature, the target of this curious species of law is anti-competitive conduct among and between the various providers in the commercial and consumer marketplace.

In Howard Smith Paper Mills, Justice Tashereau of Canada's Supreme Court wrote:

"The (Combines Investigation Act) proceeds upon the footing that the preventing or lessening of competition is in itself an injury to the public."

In the words of the then-justice of Canada's Supreme Court, the Right Hon. Brian Dickson (1916-1998), in GM v City National:

"(T)he Act as a whole embodies a complex scheme of economic regulation. The purpose of the Act is to eliminate activities that reduce competition in the market-place. The entire Act is geared to achieving this objective. The Act identifies and defines anti-competitive conduct. It establishes an investigatory mechanism for revealing prohibited activities and provides an extensive range of criminal and administrative redress against companies engaging in behaviour that tends to reduce competition. In my view, these three components, elucidation of prohibited conduct, creation of an investigatory procedure, and the establishment of a remedial mechanism, constitute a well-integrated scheme of regulation designed to discourage forms of commercial behaviour viewed as detrimental to Canada and the Canadian economy."

The predecessor to the Canadian Competition Act was a 1910 statute called the Combines Investigation Act, which fathered the first generation and cottage industry of competition and antitrust lawyers and boutique law firms, and which was replaced by the Competition Act in 1986 (for a history of the Canadian Competition Act, see 1889: Canada Wheels Out the World's First Competition Statute).

From this legacy, a branch of law now known as competition law, replete with a vocabulary all it's own:

There are others and also ancient common law ancestors such as engrossing, badgering, forestalling and regrating.

Some industries are exempt from the Competition Act regime usually because they are already covered by another statute, such as marketing boards, labeling laws, consumer protection statutes, or other areas within the jurisdiction of, and occupied by, a provincial government.

Oddly, the primary victim of abusive anti-competitive conduct, the consumer him/herself, must, for the most part, rely on government action in the event of any suspected and prohibited anti-competitive behavior. In Canada, for example:

"The responsibility for the enforcement of the (Competition Act) falls primarily to four bodies: the Commissioner of Competition; the Attorney General of Canada to me: the Completion Tribunal; and the courts.....

"There is a limited role for private parties in the enforcement of the Act."

The Competition Bureau investigates complaints and decides whether to proceed with the filing of an application to the Competition Tribunal. So, private individuals or corporate bodies who are privy to, or victims of prohibited anti-competitive conduct must bring it to the attention of the Competition Bureau, a government agency (formally known as the Commissioner of Competition), which then decides whether to undertake at all, and to then undertake, an investigation.

Alternatively, there is an administrative tribunal known as the Competition Tribunal, but still a formal court of record. The Competition Tribunal acts as a watch-guard over the Competition Bureau; for example, some decisions of the Bureau, such as not to proceed with an investigation, may be appealed to the Tribunal.

In some limited areas, such as a exclusive dealing or tied selling, private parties can bring applications before the Tribunal but only with leave of the Competition Tribunal. When compared to the litigation process in courts of law, this creates an initial hurdle for private parties, victims of conduct prohibited under the competition statute.

Decisions of the tribunal are appealable to the Federal Court of Appeal.

The Competition Bureau is the gate-keeper of competition law relief since the authority to launch an inquiry into suspected anti-competitive conduct lies with it.

There are several ways to get the Bureau's attention. One is an application for an inquiry signed by six residents of Canada. The other is to simply make a complaint to the Commissioner sufficiently alleging that the act has been contravened, and hope that the complaint will be enough for the Commissioner to investigate. The third way to get the bureau's attention is circuitous and it involves getting the federal Minister of Industry onside because the Bureau must investigate this so directed by that member of the Canadian Privy Council.

For most victims of abusive anti-competitive behavior, the proper avenue is either a complaint or the application for inquiry. Once engaged, Competition Bureau is well armed to cut through the runaround and evasive conduct that one might encounter by a company being investigated. It can order the production of records and the examination of corporate officers; and even obtain a search warrant or resort to wiretapping.

While it is ongoing, the investigations by the Competition Bureau are, oddly enough, private and in camera. Right or wrong, that is the nature of the process.

The conduct of the inquiry is completely up to the Bureau. There is no obligation in terms of a deadline but it does have to report on its progress to the initiators or the target of the inquiry, upon their request.

It is very difficult to dispute a decision by the Bureau to not undertake or to discontinue an inquiry. In Cinémas Guzzo, the Commissioner decided to discontinue an inquiry after finding no evidence of anti-competitive practices. This was appealed to the federal Court.

At ¶45 of the decision, Justice Rouleau of the Federal Court of Canada wrote of the very high threshold in the judicial review of the Bureau's decision not to investigate:

"The Commissioner's decision to discontinue the inquiry was discretionary, and the duty of fairness was minimal. The Act clearly grants wide discretion. The Commissioner enjoys a high degree of latitude in conducting an inquiry and ... has broad discretion under ... to discontinue one. (The Act) ... merely creates a right to be informed of an inquiry's progress, upon request, and ... provides that inquiries are to be held in private."

"In the case at bar, the applicant was unable to show that the Commissioner's decision was tainted by unlawfulness or bad faith or was based on irrelevant considerations."

The Competition Tribunal is one of the most unusual judicial creatures in Canadian law, an arguably necessary oddity given the complex and delicately-balanced nature of their work. The work of this group is the equivalent to open heart surgery on the Canadian economy so a variety of expertise permeates its composition. Six of its members are judges of the Federal Court, and up to eight others are non-lawyer members.

The Tribunal has the discretion to award costs.2

The Competition Act also has a regulatory offence stream to deal with more egregious conduct, acting as Crown counsel and reporting to the Attorney General on criminal investigations. Further, the federal competition statute does not displace the option of suing for economic torts such as conspiracy, the tort of intimidation, the tort of inducing breach of contract or the tort of unlawful interference with economic interests.

In many respects, the competition apparatus which hums away in the background of the stock market, is but a fly on the wall, incapable, of course, of detecting or addressing all the secret and discreet ways in which corporations test the limits of the law and ultimately harm the marketplace for the sake of their own dividends. What happens in board of director meetings stays in board of director meetings so the regulatory agency can only address what it can palpably feel and see from events, with all the shortcoming of inherent in circumstantial evidence.

Not a perfect solution but one which at the very least serves as notice to over-zealous corporations that some one is watching, some one wearing the black gown of justice.

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