Canadian Competition Bureau Publishes Draft Guidelines on Anti-Competitive Conduct and Agreements
The Canadian Competition Bureau (Bureau) recently published draft enforcement guidelines (Draft Guidelines) that cover most of the reviewable conduct (non-criminal) provisions of the Competition Act (Act), namely provisions addressing anti-competitive agreements, abuse of dominance, exclusive dealing, tied selling, market restriction, price maintenance and refusals to deal.
Although the Bureau is accepting comments on the Draft Guidelines until January 29, 2026, it has stated that, pending finalization, the draft will inform the Bureau’s enforcement of the relevant provisions of the Act. Notable takeaways include the following:
- Abuse of Dominance. The Draft Guidelines address the Bureau's abuse of dominance enforcement approach in light of recent amendments to the Act. Despite a new statutory power to secure prohibition orders under the abuse of dominance provisions without demonstrating a substantial prevention or lessening of competition, the Draft Guidelines state that the Bureau will be more likely to take enforcement action where there is evidence of harm to competition. The Bureau's guidance also confirms (i) that it will continue to use its current market share screens to consider whether an entity is dominant and (ii) that it is unlikely to investigate high pricing unless the pricing is linked to other anti-competitive acts.
- Anti-Competitive Agreements. The Bureau's Draft Guidelines adopt a number of positions from the Bureau’s prior guidance on property controls (which we previously detailed) to describe how it will enforce the Act's civil anti-competitive agreements provisions.
- Focus on Technology Sector. The Draft Guidelines have been updated from prior guidance to include discussions of how particular provisions may apply to technology-based fact scenarios, with numerous examples involving technology companies. This focus may signal that technology is expected to be a key Bureau enforcement priority.
- Conceptual Restructuring of Guidance. In contrast to prior guidance centred on specific provisions of the Act, the Draft Guidelines generally provide less concrete guidance to aid Canadian businesses in complying with the Act. The draft's conceptual discussion of anti-competitive conduct also risks giving rise to incorrect impressions about the applicable scope of the Act’s reviewable matters provisions.
We discuss each of these points in greater detail below.
Abuse of Dominance
The Draft Guidelines offer some helpful guidance for businesses, especially with respect to the Bureau's enforcement priorities under the Act's abuse of dominance provisions. Following the December 2023 amendments to the Act, the abuse of dominance framework allows a successful applicant to secure a prohibition order where it can establish that a dominant respondent has engaged in either (i) a practice of anti-competitive acts or (ii) conduct that is likely to prevent or lessen competition substantially in a market in which the respondent has a plausible competitive interest (if such effect is not a result of superior competitive performance). Accordingly, the Bureau now has some scope to pursue an abuse of dominance case where it may be difficult to establish that the challenged practice is likely to have substantial anti-competitive effects.
The Bureau indicates, however, that competitive effects will feature prominently in its enforcement decisions. The Draft Guidelines note that when the Bureau considers whether it "should seek an order stopping a practice of anti-competitive acts," it will be "more likely to act if there is some evidence that the practice also has the effect of harming competition." The Bureau adds that a case premised only on anti-competitive acts is "more likely" where "there is some evidence of harm to competition, but it is not clear we could establish a substantial effect on competition" (emphasis added). Nevertheless, the Bureau reserves enforcement discretion in this respect, noting that the ability to pursue a case based on anti-competitive acts alone "can allow us to stop the abuse of dominance at an early stage."
Notably, the Draft Guidelines continue to adopt the Bureau's current market share thresholds to assess whether a firm is dominant for the purposes of the Act. They indicate that the Bureau will generally investigate alleged anti-competitive conduct further where a single firm holds a market share of 50 percent or more, or where a group of firms jointly controlling a market holds a market share of 65 percent or more. This position is noteworthy given that recent amendments to the statutory regime for mergers to presume a substantial prevention or lessening of competition based partly on a 30 percent post-merger market share threshold (coupled with other measures of concentration) appear to have led the Bureau to propose reducing its market share screen from 35 to 30 percent to assist in assessing whether a firm has unilateral market power for the purposes of certain non-merger reviewable conduct provisions of the Act.
Finally, the Bureau also adopted much of its helpful earlier guidance on excessive and unfair pricing. Amendments to the Act that came into force in December 2023 supplemented the Act's enumerated list of anti-competitive acts with a new addition of "directly or indirectly imposing excessive and unfair selling prices." The Draft Guidelines indicate that excessive or unfair pricing, on its own, generally does not raise concerns under the Act. The Bureau's concern is principally where such pricing is used to facilitate other anti-competitive conduct. Accordingly, the Bureau's focus will be on instances where high pricing is employed to support other anti-competitive practices such as bundling, margin squeezes or constructive refusals to deal.
Anti-Competitive Agreements
Prior Bureau guidance (the Competitor Collaboration Guidelines) did not clearly address the level of intent required to reach an "agreement" for the purposes of the civil anti-competitive agreement provisions in section 90.1 of the Act. Although these prior guidelines noted that a "meeting of the minds" was required for an agreement under the criminal provisions of the Act, that language was absent from the previous discussion of section 90.1. The Draft Guidelines now expressly acknowledge the requirement for a "meeting of the minds" under section 90.1. The draft notes that "conscious parallelism alone between competitors does not create an agreement that we can act on under section 90.1." This is a helpful clarification that can assist businesses in understanding the scope of the Act's civil anti-competitive collaboration provisions.
The Draft Guidelines also adopt a number of positions from the Bureau's prior guidance on property controls to describe how the Bureau will enforce the Act's civil anti-competitive agreements provisions in section 90.1 of the Act, including with respect to agreements between parties that do not compete with one other. In our prior analysis of the Bureau's property controls guidance, we discussed the Bureau's approach to the provision of section 90.1 that captures agreements between non-competitors where a "substantial purpose" of the agreement is to prevent or lessen competition.
Focus on Technology Sector
The Draft Guidelines may reveal Bureau enforcement priorities through the subject matter they discuss. Technology companies feature prominently in the examples in nearly every section of the Draft Guidelines. The guidance is replete with examples drawn from the technology sector, including with respect to (i) market definition (where data are identified as barriers to entry); (ii) conceptual definitions of anti-competitive conduct (where technological compatibility of products in the "same digital ecosystem" is identified as a tool that can support tying); and (iii) the specific criteria that the Bureau may consider when coming to an enforcement decision (e.g., in the self-preferencing context, discussions of "multi-homing").
Restructured Guidance
The Bureau has indicated that the Draft Guidelines have been designed to reflect how the Bureau analyzes cases – namely, by assessing, first, the competitive impact on the relevant market and then considering which provisions of the Act, if any, would capture that conduct.
That framing has had a significant impact on the Draft Guidelines compared with the Bureau guidance that they replace. The draft is divided into sections that mirror the steps the Bureau would take to assess a fact pattern. They begin with market power and market definition (section 2), then consider impact and remedies (sections 3 through 5), before categorizing conduct into particular conceptual (section 6) and legal categories (section 7). As such, the Draft Guidelines are an ambitious attempt to address in one place all of the key reviewable matters provisions of the Act apart from mergers. (The Act's merger provisions are the subject of separate enforcement guidelines that are also currently undergoing revision.)
Prior Bureau guidelines covering the same ground were more focused and specific. Each set of guidelines generally considered a subset of the reviewable conduct provisions – namely abuse of dominance, competitor collaborations and price maintenance. Relatively more detailed or specific guidance for businesses was contained in a smaller portion of a much shorter document.
The Draft Guidelines replace these three prior standalone Bureau guidance documents. The Draft Guidelines' broad scope and analytical structure have resulted in a lengthy (over 190 pages) and somewhat repetitious document. The emphasis on less technical plain language, simplification of examples and removal of citations to case law also result in greater ambiguity.
As a result, the Draft Guidelines are deceptively complex. To understand a particular concept presented in this updated guidance, in some cases it is necessary to read several sections together. For example, at least three different sections address the concept of exclusion as it applies to exclusive dealing: sections 3.1 Exclusion; 6.1 Types of Exclusive Dealing; and 7.5 Exclusive Dealing.
A consequence of this structure is that portions of the Draft Guidelines, if not read in full context, can appear to suggest that certain lawful conduct could be subject to sanction under the Act. Section 6, "Types of anti-competitive conduct and agreements," poses the greatest risk. This section describes the Bureau’s "issue spotting" framework. It sets out types of conduct that the Bureau may look for when assessing whether conduct is worth investigating. The Bureau introduces the section by saying that "these types of conduct and agreements are not always anti-competitive." This caution is critically important, but far from obvious to a reader who consults a single section of the draft.
Similarly, in discussing the general concept of tying or tied selling, the Draft Guidelines note that products may be "tied" together by "technological" ties, such as by designing "products in a way that the products only work together, or work best when used together" as part of the "same digital ecosystem." Yet much later, in discussing the tied selling provision of the Act, the Draft Guidelines replicate the language from the Act that bars the Competition Tribunal from making an order under these provisions where "tied selling is reasonable having regard to the technological relationship between or among the tied products." The Draft Guidelines separate the "conceptual" definition of tying from the "legal" discussion by more than 300 paragraphs.
Ultimately, businesses looking for guidance should pay heed to the structure of the Draft Guidelines when engaging with them. Even then, the Draft Guidelines may not include the more specific guidance that was previously available. We expect this to be a topic to be addressed during the consultation process, and the Bureau may incorporate feedback from this process to alter some aspects of the guidance before it is finalized.
The Davies Competition, Antitrust and Foreign Investment group would be pleased to advise clients with respect to the application of the reviewable matters provisions of the Act, interpreting the Draft Guidelines or assisting in the preparation of comments on the Draft Guidelines by interested parties.
