Canada merger control (2019)
Produced in partnership with Davies Ward Phillips & Vineberg LLP
Canada merger control (2019)

The following Competition guidance note Produced in partnership with Davies Ward Phillips & Vineberg LLP provides comprehensive and up to date legal information covering:

  • Canada merger control (2019)
  • General overview of the key merger control regimes in Canada
  • 1. Have there been any recent developments regarding the Canadian merger control regimes and are any updates/developments expected in the coming year? Are there any other ‘hot’ merger control issues in Canada?
  • 2. Under Canadian merger control law, is the control test the same as the EU concept of ‘decisive influence’? If not, how does it differ and what is the position in relation to 'minority shareholdings'?
  • 3. Are joint ventures caught by the national merger control provisions (including non-structural, cooperative joint ventures)?
  • 4. What are the merger control thresholds and would a purely foreign-to-foreign transaction be caught (commenting on any ‘effects’ doctrine/policy if relevant)?
  • 5. Are there any specific issues parties should be aware of when compiling and calculating the relevant turnover for applying the jurisdictional thresholds?
  • 6. Where the jurisdictional thresholds are met, is notification mandatory and must closing be suspended pending clearance?
  • 7. Is there any discretion to review transactions that fall below the notification thresholds?
  • 8. Is it possible to close the deal globally prior to local clearance?
  • more

A conversation with Mark Katz, partner at Canadian law firm Davies Ward Phillips & Vineberg LLP, on key issues on merger control in Canada.

NOTE–to see whether notification thresholds in Canada and throughout the world are met, see Where to Notify.

General overview of the key merger control regimes in Canada

Competition Act

Canada's Competition Act (the Act) authorises the Commissioner of Competition (the Commissioner) to challenge merger transactions that are likely to prevent or lessen competition substantially in a relevant market affecting Canada. The Commissioner heads the Competition Bureau (the Bureau) which is responsible for investigating merger transactions to determine if they are likely to have the proscribed anti-competitive effect.

The definition of ‘merger’ for these purposes is quite broad. In addition to acquisitions of control (defined as the acquisition of a greater than 50% interest in the target entity), a 'merger' includes any transaction by which one party acquires or establishes a 'significant interest' in the business of another. 'Significant interest' is interpreted as the ability to exercise 'material influence' over the target party's business, which can capture acquisitions of minority interests (even potentially as low as 10%), as well as contractual arrangements in which there is no transfer of interests at all.

The Act also establishes a pre-merger notification regime for certain types of merger transactions that exceed statutory thresholds