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Chapter 4

LAW 529 Chapter Notes - Chapter 4: True Crime, Advertising Slogan, Service Canada

Law and Business
Course Code
LAW 529
Pnina Alon- Shenker

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Chapter 4
Competition Act
Overview of Canadian antitrust law (4-1, 4-3)
Difference between “antitrust law” “anti-combines law” and “competition law”
Anti-trust: American term used
Anti combines law: old name for the competition law
Competition law: Canadian version
There is no difference between the 3 - THEY ALL DEAL WITH THE SAME THING
oIntentional (true crime) offences
oStrict Liability (regulatory) offences
oCivil Reviewable matters
Constitutional level(s) of government that can address anti-competitive activity
Federal government handles the competition laws(head of power) (it’s a bureau) Under the Constitution
Act of 1867 sec 91 sub (2)
Provincial power (Constitution Act 1867 sec 92(13)
- Difference b/w federal and provincial power: province is responsible for administration of laws provincially
(Ontario cannot address issues from other provinces)
(i.e. combines law GM case )
oSupreme court made a ruling on the GM case distributing the divisions of power to the federal
government (federal government has the authority to address completion law)
Activities are addressed in the Competition Act
-Deal with Misleading advertising, deceptive telemarketing, etc
-Government agencies involved
Administered and enforced by the Bureau (federal enforcement agency)
Headed by the Commissioner
Commissioner runs the competition bureau
Investigates complaints by consumers and businesses
Competition tribunal: specialized court that only handles competition act issues
(What agencies are involved: federal agencies, competition bureau (federal agency))
Purpose of the Act
1. Promote Efficiency and Adaptability of Canadian economy
2. Expand opportunities for Canadian participation in world markets
3. Ensure small and medium sized enterprises have an equitable opportunity to participate in Canadian
4. Provide consumer with competitive prices and product choices
Intentional (True crime) offences & Strict Liability
Criminal Offences – Include
oConspiracy (i.e. Cartels) Sec 45
oBid-rigging –Sec 47
oKnowing. Reckless misleading Advertisement- Sec 52
oDeceptive telemarketing - Sec 52.1
True criminal & strict liability offences – Investigated by bureau  Prosecuted by Public Prosecution
Service Canada  Tried in provincial criminal courts Subject to penalties fines (imprisonment and
prohibition orders)
(i.e. Court order to stop or modify conduct)
Bureau Has access to variety of significant and intrusive powers to these type of offences
oAbility to obtain search warrants
oCourt orders to compel production of documents

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Bureau has immunity program to assist the detection and enforcement of certain offences under the Act
Civil Reviewable Matters
Heard by the Competition Tribunal (does not have authority to impose jail penalties)
Matters include
o*Civil misleading advertisement – Sec 74.01
oRefusal to deal- Sec 75
oPrice maintenance – Sec 76
oTied selling/Exclusive deals/Market restrictions – Sec 77
oAbuse of dominance – Sec 78 & 79
oMergers – Sec 92
* Misleading Advertisement – May be dealt with by the Bureau using INTENTIONAL (true crimes) offences under
the Competition Act –or- Strict Liability offences under the Act or- civil reviewable practice under sec 74.01 of
the Act
May also be investigated by Bureau and resulting in proceedings initiated by Bureau (or private parties in
leave cases)
Heard before the Competition tribunal (sometimes provincial or federal courts)
Subject to potential penalties other then imprisonment
Penalties (where contravention of civil provision occurs)
oCourt orders to stop conduct
oOrders to resume supply of product
(i.e. where a refusal to deal or supply occurs)
oAdministrative monetary penalties (civil fines)
(Up to $10 million)
oRestitution orders to compensate consumer
Private Damage Actions
Private parties can commence private actions for damages (civil actions) against persons where the court
concludes that the persons are contravening true criminal sections of the Act
These include
oSec 45 (conspiracy agreements)
oSec 47 (bid-rigging)
oSec 52(knowing or reckless misleading advertisement)
oStrict Liability offences
Private parties – certain cases can make private access applications to the Competition Tribunal for orders
(Under refusal to deal, price maintenance and exclusive/dealing/tied selling/market restrictions section of Act)
Required to obtain leave from tribunal before making private access application
Monetary damages are not available
oOrder to stop conduct
oResume supply on usual terms
Violation of the Act- led to lost time and negative publicity(individuals or companies + other orgs and
Penalties for Criminal or Strict Liability
oFines up to $25 million
Penalties for Civil Matters
oAdministrative monetary penalties up to $10 million
oCivil damages
oCourt order to stop or modify conduct
Penalties for Private Parties (i.e. consumers or competitors)
oPrivate action damages
 Plaintiff suffers actual damage or loss as a result of a violation of the criminal provision of the Act-or- Tribunal
order under act

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Competition Act-selected provisions
Compare the wording of the offences, defenses, and the penalties available, for: conspiracy (s. 45)
False or misleading representations (s. 52)
Deceptive notice of wining a prize (s. 53)
Double ticketing (s. 54)
Deceptive marketing practices (Civil reviewable matters) in Part VII.I
Competition Act: misleading representation offence
52(1) No person shall, for the purpose of promoting, directly or indirectly, the supply or use of a
product or for the purpose of promoting, directly or indirectly, any business interest, by any means
whatever, knowingly or recklessly make a representation to the public that is false or misleading in
a material respect
52(5) imprisonment penalty, unlimited fine
52(1) type of offense - strict liability (language that pushes it out? YES = “knowingly”, therefore it is a true
criminal intention offence) NO limitations
Deals with any type of misrepresentation from anyone
Competition Act- deceptive telemarketing offence
52.1 (3) No person who engages in telemarketing shall:
Make a representation that is false or misleading in a material respect,
Conduct or purport to conduct a contest, lottery or game of chance, skill or mixed chance and skill
The delivery of a prize or other benefit to a participant in the contest…is…conditional on the prior
payment of any amount by the participant, or
Adequate and fair disclosure is not made of the number and approximate value of the prizes, of
the area or areas to which they relate and of any fact within the person’s knowledge, that affects
materially the chances of winning;
Offer a product at no cost, or at a price less than the fair market value of the product, in consideration of
the supply or use of another product, unless fair, reasonable and timely disclosure is made of the fair
market value of the first product and of any restrictions. …Applicable to its supply to the purchaser
Offer a product for sale at a price grossly in excess of its fair market value, where delivery of the
product is, or is represented to be, conditional on prior payment by the purchaser
(6) No person shall be convicted of an offence under this section who establishes that the
person exercised due diligence to prevent the commission of the offence.
(9) Any person who contravenes…is guilty of an offence and liable on conviction on indictment,
to fine in the discretion of the court or to imprisonment
52.1(3) deals with specific area: telemarketers
Assume strict liability
But there is NO language that pushes it out (no language of intent)
Misrepresentations- Part VII.1 -s. 74.01 & 74.1
s. 74.01 A person engages in reviewable conduct who, for the purposes of promoting….the supply or
use of a product….by any means….makes a representation that is false or misleading in a material
s. 74.1 (1) Where, on application by the Commissioner, a court determines that a person is engaging
in…reviewable conduct…the court may order the person
(a) Not to engage in the conduct….
(b) To publish ….a notice….
(c) To pay an administrative penalty…. in an amount not exceeding
(i) in the case of an individual, $750,000….or
(ii) in the case of a corporation, $10,000,000……
Misleading Representations: Criminal or Civil track
The difference between the “criminal track” and the “civil track”
Criminal Track: Intentional harm to individuals but which, in a larger sense, are offences against us all
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