Time to Review Complex Transactions Slightly Longer

The Bureau’s typical timing to complete its review of complex transactions is now slightly longer, with the average number of days required to complete a complex review increasing from 37.8 days on average for the three years prior to the amendments (and a low of 36.3 days in 2023) to an average of 42.9 days over the past two years (with a high of 48.11 days for the most recent six-month period).

The number of SIRs has also increased over the past two years – from an average of 10 per year in the three years prior to the amendments to an average of 12.5 over the past two years. A SIR is typically issued where the transaction raises more complex substantive considerations. When a SIR is issued, the statutory waiting period is extended to 30 days after compliance with the SIR. Typically, transactions that result in a SIR will require several months to clear.

Although the number of SIRs has increased, the risk of receiving a SIR or a related delay may be higher than these data suggest, given that there were seven “pull and refiles” of merger notifications in the past fiscal year. Parties will typically pull and refile a notification to try to avoid a SIR (or at least narrow its scope), even though it restarts the waiting period. The Bureau’s most recent performance report identified the number of pull and refiles for the first time. However, based on prior public remarks by Bureau officials, we understand that over the past two years, there have been a total of 13 pull and refiles, whereas for the four years prior to that, the total pull and refiles was six for all four years. These results suggest that since the amendments, parties have increasingly perceived that the risk of receiving a SIR (or a relatively more extensive SIR) warrants restarting the waiting period and providing more time to persuade the Bureau to clear the transaction either without a SIR or with a SIR of more limited scope.

As the pull and refile strategy restarts not only the statutory waiting period, but also the service standard period, we expect that the Bureau’s performance statistics similarly reflect a restarted “clock” with respect to the number of days to review. As a result, for the thirteen complex transactions that were pulled and refiled in the past two years, the full time to review (measured from the initial filing) would have been substantially longer than the reported average.

On the positive side, the Bureau’s typical timing to complete non-complex merger reviews remains relatively consistent with pre-amendment patterns, suggesting that the Bureau is still able to triage non-complex transactions quickly, with an average review time of 10.85 days in the last fiscal period.

Canada's Amended Merger Review Process: Key Takeaways After Two Years

En cours de traduction.