Competition Act Merger Notification Threshold Revised Upward

The Competition Bureau (Bureau) announced on February 7, 2012 that the pre-merger notification transaction-size threshold for 2012 will increase to $77 million from the 2011 threshold of $73 million. As per the indexing mechanism set out in the Competition Act (Act), the pre-merger notification threshold is reviewed annually. The 2012 threshold is anticipated to come into effect on February 11, 2012.

The threshold is based on the book value of assets in Canada of the target (or in the case of an asset purchase, of the assets in Canada being acquired), or the gross revenues from sales "in or from" Canada generated by those assets, calculated in accordance with the Notifiable Transactions Regulations under the Act. Once the 2012 threshold is in effect, the Bureau must generally be given advance notice of proposed transactions when the acquired assets in Canada or revenues generated in or from Canada from such assets exceed $77 million, and when the combined Canadian assets or revenues in, from or into Canada of the parties together with their respective affiliates exceed $400 million. This amount has not been reviewed and remains the same as in 2011.