Competition Bureau Moves Forward With Implementation of Merger Registry
The Competition Bureau (Bureau) announced its intention to publish monthly reports of concluded merger reviews. In some cases, particularly where the Bureau is approached on a confidential basis, such reports could raise strategic issues for parties to a proposed transaction.
On February 6, as part of its efforts to increase transparency in the merger review process, the Bureau announced that it would begin publishing monthly reports of concluded merger reviews. The first report will be published in early March, and further reports will be made available at the beginning of each month thereafter. The monthly report will contain a list of merger reviews concluded in the prior month where either a mandatory pre-merger notification or a request for an Advance Ruling Certificate (ARC) was made. The report will identify the parties to the transaction, and provide information with respect to the industry sector involved and the outcome of the Bureau’s review; namely whether the Bureau issued an ARC or a "no-action letter," or whether a consent agreement or an application was filed with the Competition Tribunal.
As mentioned above, in some cases, information published in the monthly reports could raise strategic issues for merging parties, particularly where a proposed transaction, or the fact that it was reviewed by the Bureau, has not been made public. For example, in the case of a hostile take-over bid where the bid has not yet been announced, the transaction may have been cleared by the Bureau without the need for market contacts. Publication in the merger registry in such case would be disclosing confidential information.
Earlier this year, the National Competition Law Section of the Canadian Bar Association (CBA) expressed concerns in relation to the Bureau’s decision to publish monthly merger reports. In a letter to the Bureau, the CBA noted that such disclosure could raise issues as to whether, absent express authorization of the parties, the publication of such information would be in line with the statutory confidentiality protections provided under the provisions of the Competition Act (Act). In connection to a merger review, section 29 of the Act establishes a statutory confidentiality scheme which specifically protects the fact that a notification has been made and any information provided to the Bureau in respect of a proposed transaction. Although the Commissioner of Competition is allowed to disclose confidential information where the disclosure is deemed to be necessary for the "administration or enforcement" of the Act, the CBA noted that the communication of the results of the Bureau’s reviews in the monthly reports would not be captured under this exception and, therefore, express authorization of the parties to a proposed transaction should be required in order to comply with the confidentiality provisions of the Act.
McCarthy Tétrault Notes
While greater transparency in merger review process is welcome, the implementation of a merger registry does not appear, at this time, to give insight into the analytic framework of the Bureau with respect to merger review. It will be interesting to see whether the Bureau will respond to the concerns expressed by the CBA in relation to the publication of these reports, as well as any legal challenges from merging parties that may arise in relation to the disclosure of confidential information provided to the Bureau in relation to a merger review.