On Recent Amendments to the Canadian Competition Act

Benefit Derived and the Determination of Monetary Penalties

Abstract

Recent amendments to the Canadian Competition Act have expanded the set of antitrust enforcement tools available to the Competition Bureau and Tribunal, while also allowing private parties to apply for damages.  This paper focuses on the greatly expanded range of deterrent fines that the Tribunal may impose on violators.  These fines may be imposed up to three times the value of the benefit derived from the illegal conduct or, if that concept cannot be “reasonably determined”, up to three percent of a violating firm’s global revenues.  The Tribunal may also award damages to injured parties that may not exceed the violator’s benefit derived from the illegal conduct.  I argue that antitrust cases where benefit derived can be reasonably determined will be rare, so that fines will be set by other, less objective and transparent means, in which case damages may not be available.   These conclusions are consistent with the history of fines set by the European Commission, which for over 25 years has been empowered to set fines based on gains improperly made—a synonym for benefit derived—when it is “possible” to do so, yet there are no documented cases of fines being based on that concept.  Overall, my view is the amendments will move Canadian antitrust policy much closer to that of the European Union, which is a source of concern.