Parliament Got It Right

Why Rebuttable Structural Presumptions Make Sense in Merger Review

Abstract

In 2024, rebuttable structural presumptions were incorporated into the merger provisions of the Competition Act. This means that a merger is now presumptively anti-competitive if the Competition Bureau can show that it would likely result in a significant increase in concentration or market share above prescribed levels. Merging parties can rebut such a presumption by showing that, contrary to the structural inference, the merger is unlikely to harm competition substantially. Failing that, however, the Competition Tribunal has discretion to prohibit or remedy the transaction to safeguard competition.

This new burden-shifting framework is consistent with the longstanding approach to mergers under U.S. antitrust law. It provides a clear and simple guidepost for merger analysis, while still allowing all relevant evidence bearing on a merger’s likely competitive effects to be considered. Nevertheless, the change has been met with significant opposition by many in the business and practitioner community who view it as retrograde.

This paper provides historical context for this recent reform, arguing that it was part of a necessary set of corrections for a regime that had become unworkably complex. It then explains why rebuttable structural presumptions make sense for merger review, from both an economic and a practical perspective.