CT-2022-002
COMPETITION TRIBUNAL IN THE MATTER OF an application by the Commissioner of Competition for one or more orders pursuant to section 92 of the Competition Act, RSC 1985, c C-34.
BETWEEN:
COMMISSIONER OF COMPETITION
– and –
Applicant
ROGERS COMMUNICATIONS INC. AND SHAW COMMUNICATIONS INC.
Respondents
BOOK OF AUTHORITIES
DEPARTMENT COMPETITION
OF JUSTICE CANADA BUREAU L EGAL S ERVICES
Place du Portage, Phase I 50 Victoria Street, 22nd F loor Gatineau QC K1A 0C9
Ryan Caron Kevin Hong
Tel: 819-635-3797 Fax: 819-953-9267
ryan.caron@cb-bc.gc.ca kevin.hong@cb-bc.gc.ca Counsel to the Commissioner of Competition
CT-2022-002
COMPETITION TRIBUNAL IN THE MATTER OF an application by the Commissioner of Competition for one or more orders pursuant to section 92 of the Competition Act, RSC 1985, c C-34.
BETWEEN:
COMMISSIONER OF COMPETITION
– and –
Applicant
ROGERS COMMUNICATIONS INC. AND SHAW COMMUNICATIONS INC.
Respondents
INDEX
JURISPRUDENCE TAB Canada (Commissioner of Competition) v Direct Energy Marketing Limited, 2013 Comp Trib 16, 2013 CarswellNat 6037 ......................................................1
Canada (Commissioner of Competition) v Visa Canada Corp, 2011 Comp Trib 2, 2011 CarswellNat 6510 .........................................................................................2
LEGISLATION TAB Competition Act, RSC, 1985, c. C-34, s 92(1)(f) ...............................................................3 Competition Tribunal Act, RSC 1985, c. 19 (2nd supp), s 9(3) ........................................4 Competition Tribunal Rules, SOR/2008-141, s 43 ............................................................5
TAB 1
2013 Comp. Trib. 16 Competition Tribunal
Commissioner of Competition v. Direct Energy Marketing Limited 2013 CarswellNat 6037, 2013 Comp. Trib. 16 In the Matter of the Competition Act, R.S.C. 1985, c. C-34, as amended In the Matter of an application by the Commissioner of Competition pursuant to section 79 of the Competition Act In the Matter of certain policies and procedures of Direct Energy Marketing Limited The Commissioner of Competition, (applicant) and Direct Energy Marketing Limited, (respondent) and National Energy Corporation, (applicant for leave to intervene)
Donald J. Rennie J. Heard: October 17, 2013 Judgment: November 6, 2013 Docket: CT-2012-003
Counsel: Jonathan Hood, for Applicant, Commissioner of Competition Donald B. Houston, Helen Burnett, Justin H. Nasseri, for Respondent, Direct Energy Marketing Limited Adam Fanaki, Derek D. Ricci, for Applicant, for leave to intervene, National Energy Corporation
Donald J. Rennie J.: I. Introduction 1 National Energy Corporation ("National"), a supplier of natural gas and electric water heaters for rental to Quebec and Ontario homeowners, seeks leave to intervene in these proceedings brought by the Commissioner of Competition (the "Commissioner") pursuant to the abuse of dominance provision (s. 79) of the Competition Act, R.S.C. 1985, c. C-34. The Respondent, Direct Energy Marketing Limited ("Direct Energy"), opposes National's request. In the alternative, it contends that the scope of National's intervention ought to be restricted.
II. Analysis A. The Request for Leave to Intervene 2 National's request for leave to intervene is brought pursuant to subsection 9(3) of the Competition Tribunal Act, R.S.C. 1985, c. 19 (2 nd suppl.), which provides that any person may, with leave of the Tribunal, intervene in a proceeding to make representations that are relevant to the proceeding in respect of any matter that affects that person.
3 In order to be granted intervener status, the person seeking leave to intervene must meet the following requirements: (a) The matter alleged to affect the person seeking leave to intervene must be legitimately within the scope of the Tribunal's consideration or must be a matter sufficiently relevant to the Tribunal's mandate (Canada (Director of Investigation & Research) v. Air Canada (1992), 46 C.P.R. (3d) 184 (Competition Trib.), at 187);
(b) The person seeking leave to intervene must be directly affected. The word "affects" has been interpreted in Air Canada, ibid., to mean "directly affects";
(c) All representations made by a person seeking leave to intervene must be relevant to an issue specifically raised by the Commissioner (Canada (Director of Investigation & Research) v. Tele-Direct (Publications) Inc. (1995), 61 C.P.R. (3d) 528 (Competition Trib.);
(d) Finally, the person seeking leave to intervene must bring to the Tribunal a unique or distinct perspective that will assist the Tribunal in deciding the issues before it (Washington v. Canada (Director of Investigation & Research), [1998] C.C.T.D. No. 4 (Competition Trib.)).
(Commissioner of Competition v. Visa Canada Corp., 2011 Comp. Trib. 2 (Competition Trib.); Canada (Commissioner of Competition) v. Canadian Waste Services Holdings Inc., 2000 Comp. Trib. 9 (Competition Trib.))
4 Direct Energy conceded at the hearing of National's motion that National is directly affected by the proceeding, but submitted that National would not bring a unique or distinct perspective that would assist the Tribunal in deciding the issues before it. National, relying in particular on the affidavit of Mr. Gord Potter, National's Chief Operating Officer, submitted that it does have such a perspective.
5 Mr. Potter explained in his affidavit that National is a supplier of home services, including the rental of energy efficient water heaters and the supply of HVAC equipment to existing and new homeowners in Ontario and Quebec. He adds that National is one of the largest competitors to Direct Energy for the supply of water heater rental services in the relevant market, but that its attempts to effectively compete and expand in the market have been constrained by the conduct of Direct Energy. It is not contested that National has filed a complaint with the Competition Bureau which led the Bureau to investigate Direct Energy's conduct.
6 Direct Energy submits that the Tribunal should not grant National leave to intervene because National's evidence can be adduced through the Commissioner, making the participation of National unnecessary. As a result, National will not bring a unique or distinct perspective to the Commissioner's proceedings.
7 The parties' dispute has its root in their divergent interpretations of requirement (d) of the above test. Direct Energy submits that this element requires National to establish that it has something "to add as an intervener which cannot be adduced by the Commissioner by calling a representative of National as a witness." National opposes this view and submits that the case law does not support such a restrictive interpretation and that Direct Energy confuses the requirement of a unique or distinct perspective with the adoption of a different legal position.
8 Neither subsection 9(3) of the Competition Tribunal Act nor the case law provide that intervener status can only be granted to persons who have established that their evidence and argument cannot be presented by the party whose legal position they support. Direct Energy casts the test too highly when it submits that National must establish that its proposed evidence cannot be adduced by the Commissioner. To accede to the argument would set such a high bar that it is doubtful that it could ever be met and would preclude, in all likelihood, any person, who has filed a complaint with the Bureau, from ever playing the role of an intervener in a Tribunal proceeding.
9 No Competition Tribunal decision has held that such a requirement is necessary and it can certainly not be extrapolated from the Tribunal's decision in Southam Inc. v. Canada (Director of Investigation & Research) (1997), 78 C.P.R. (3d) 315 (Competition Trib.), in which the Tribunal held that interveners, by bringing their own and distinct perspective, "...supplement the case of a party...". The Tribunal has often granted complainants or competitors leave to intervene in a proceeding brought by the Commissioner.
10 Direct Energy's interpretation would also run counter to the principles set out by the Federal Court of Appeal in Canada (Director of Investigation & Research) v. Air Canada (1988), [1989] 2 F.C. 88 (Fed. C.A.) [hereinafter American Airlines] (aff'd, [1989] 1 S.C.R. 236 (S.C.C.)):
In these matters, Parliament has provided for the Director to serve as the guardian of the competition ethic and the initiator of Tribunal proceedings under Part VII of the Competition Act; but Parliament has also provided a means to ensure that those who may be affected can participate in the proceeding in order to inform the Tribunal of the ways in which matters complained of impact on them. I would ascribe to Parliament the intention to permit those interveners not only to participate but also to do so effectively. A restrictive interpretation of section 9(3) could in some cases run counter to the effective handling of disputes coming before the Tribunal.
[emphasis added] 11 The Federal Court of Appeal also held, at page 99, that subsection 9(3) should be examined in light of subsection 9(2): Fairness is a relevant consideration because subsection 9(2) of the Competition Tribunal Act expressly requires that proceedings before the Tribunal be dealt with as informally and as expeditiously as the circumstances and fairness allow.
12 In this case, the affidavit of Mr. Potter contains detailed evidence explaining why National brings a unique or distinct perspective. I accept that National has special knowledge and expertise that may assist the Tribunal and that, although it supports the Commissioner's position generally, its business interests are different from the Commissioner's public interest mandate (Canada (Director of Investigation & Research) v. Tele-Direct (Publications) Inc. (1995), 61 C.P.R. (3d) 528 (Competition Trib.)).
13 Direct Energy's submission that National seeks to use the Tribunal as a forum to advance its private litigation agenda against Direct Energy should be dismissed. Direct Energy has not established that National is seeking to intervene for improper purposes and the Tribunal notes that certain safeguards exist to address Direct Energy's concerns (see e.g. Rule 62 of the Competition Tribunal Rules, SOR/2008-141) and additional safeguards can be put in place if so necessary. At best, the assertion is premature and remains hypothetical.
14 Subsection 9(3) provides that the intervener may only make representations that are relevant to the proceedings and this means that the representations must be relevant to the proceeding as defined by the pleadings (see Canada (Director of Investigation & Research) v. Tele-Direct (Publications) Inc. (1995), 61 C.P.R. (3d) 528 (Competition Trib.)). Direct Energy's submission that National seeks to broaden the issues raised in the Commissioner's application shall be dealt with below when examining the topics on which National seeks leave to intervene.
15 In the circumstances, National has established that this is a proper case in which leave to intervene should be granted. B. The Scope of Intervention 16 Both the Commissioner and Direct Energy oppose some of the terms of National's proposed scope of intervention. 17 It should be noted that National's motion for leave to intervene was heard on the same day that the Tribunal heard National's motion for leave to intervene in the proceeding brought by the Commissioner against Reliance Comfort Limited Partnership ("Reliance") (CT-2012-002). The two proceedings, which were filed on the same day, are similar and National's proposed topics and terms of participation are identical in both proceedings. The Commissioner's position with respect to National's request is identical in both proceedings as well. While Reliance did not oppose National's intervention, it did oppose some of the terms of National's proposed scope of intervention.
18 In the circumstances, it is reasonable for the Tribunal to examine Reliance's objections together with those formulated by Direct Energy.
19 At the hearing of the motions, counsel for National provided the Tribunal with a table setting out the topics on which it sought leave to intervene and the parties' respective positions with respect to each topic.
A B
C D
E F G
H
I
J
Proposed Topic The development of the Ontario rental water heater industry as it relates to National. The issue of Reliance's/Direct Energy's anti-competitive acts as they relate to National, including the impact of Reliance's/ Direct Energy's exclusionary water heater return policies and procedures and other anti-competitive conduct as alleged in the Commissioner's Application, on the ability of National to effectively compete and expand in the Relevant Market. The impact of Reliance's/Direct Energy's anti-competitive acts on customers or proposed customers of National. National's interactions with Reliance/Direct Energy with respect to the matters at issue in the proceeding, including dealings with Reliance/Direct Energy regarding the water heater removal and return process. National's perspective as a participant in the industry on the appropriate definition of the product and geographic markets. The issue of Reliance's/Direct Energy's dominant position as it affects competition in the Relevant Market generally. The issue of the substantial lessening or prevention of competition as it relates to National and competition in the Relevant Market generally. Barriers to entry and ease of entry into the Relevant Market, based on National's experience, including whether Reliance's/Direct Energy's conduct creates artificial barriers to entry and expansion for National or raises National's costs. The statements made and conclusions drawn by Reliance/Direct Energy concerning National in the Response of Reliance/Direct Energy filed in this proceeding. The impact of the Commissioner's proposed remedies on National and on competition in the Relevant Market.
Commissioner Consent
Consent
Consent Consent
Modify Modify Modify
Consent
Modify
Modify
Reliance Consent
Modify
Modify Consent
Oppose Oppose Oppose
Modify
Consent
Modify
Direct Energy Oppose
Consent
Oppose Consent
Oppose Oppose Oppose
Oppose
Consent
Modify
20 With respect to Topic A, I find that it is relevant and that National, given the formulation of the topic, will bring its own distinct or unique perspective. In the circumstances, National shall be allowed to intervene on this topic.
21 Direct Energy does not oppose Topic B whereas Reliance seeks to modify it so as to confine it explicitly to the "impact" on National and to the alleged anti-competitive acts as set out in the Commissioner's application. Given the explicit acknowledgement made by counsel for National at the hearing that the "...anti-competitive conduct, which should be the focus of our intervention, must be the anti-competitive conduct which is at issue in the proceeding and as specifically pled by the Commissioner", the wording of Topic B is acceptable. It cannot be interpreted at a later stage to have broadened the Commissioner's allegations as set out in his pleadings. It is not necessary to replace the word "issue" with the word "impact", as was suggested by Reliance.
22 Direct Energy opposes Topic C and while Reliance, in its written submissions, opposed Topic C, it indicated at the hearing that Topic C would be unnecessary as Topic B already allows National to adduce direct evidence regarding customers. Direct Energy submitted that National seeks to speak on behalf of consumers under this Topic and that it cannot do so.
23 At the hearing, counsel for National indicated that it has no intention to speak for or on behalf of all consumers, generally. Rather, under this proposed topic, National seeks to describe its direct knowledge of how Direct Energy's alleged conduct impacts customers or its efforts to attract potential customers, including National's ability to induce customers to switch suppliers. Given these clarifications made by counsel, this Topic is acceptable and appropriate.
24 With respect to Topic E, Reliance and Direct Energy submit that National seeks to redefine the issues of product market and geographic market in a manner that is different from that defined by the Commissioner in his pleadings. National, as a market participant, brings its own perspective on the relevant product and geographic markets, based on its experience. It is very possible that its perspective and that of the Commissioner, while they may overlap, may not be identical.
25 Direct Energy and Reliance object to National having any view on product or geographic market. They base their objection on fairness, and say that they know the case they have to meet, and that is the case as defined by the Commissioner. I agree. The case is defined by the Commissioner and it cannot be re-cast by an intervener. That said, an intervener may have pertinent information and a useful perspective about these issues as framed by the Commissioner. To exclude the intervener from having a role in respect of the nuances and precise contours of these two issues as framed by the Commissioner would render the right of intervention illusionary. National can give its perspective as a participant in the industry on the definition of the product and geographic markets as framed by the Commissioner.
26 Reliance and Direct Energy oppose Topics F and G and note that National does not bring a unique or distinct perspective when it wishes to speak as to competition in the relevant market generally. They note that these Topics strike at the heart of the alleged restrictive trade practice and that it is for the Commissioner to establish the constituent elements of the practice. Counsel for Reliance indicated at the hearing that Reliance would not object to these Topics if they had been limited to the impact on National. The Commissioner also submits that the Topics should be limited to National.
27 In the circumstances, I find that these are proper topics with respect to which National brings its own distinct perspective, given its experience in the market place. Any evidence to be presented by National in this regard should be limited to that of National alone.
28 Direct Energy opposes National's proposed Topic H and Reliance proposes alternative wording. Whereas Reliance's initial concerns have now been addressed, I see no reason to prevent National from making representations with respect to this Topic given the express reference and limitation to National's experience. National brings a unique or distinct perspective in this regard.
29 Direct Energy and Reliance do not oppose Topic I, but the Commissioner has asked that the Topic be explicitly restricted to National's "conduct" in the responses filed. The addition of the limitation does add useful precision and will therefore be added.
30 With respect to Topic J, Reliance, Direct Energy and the Commissioner seek to remove the reference to "on competition in the Relevant Market". The Tribunal, in previous decisions, has allowed interveners to provide a view of the impact of the proposed remedy (see, e.g., Commissioner of Competition v. Visa Canada Corp., 2011 Comp. Trib. 2 (Competition Trib.), where the Tribunal allowed a bank to make representations regarding the impact of the proposed remedy on the payments system). National does bring a unique or distinct perspective on the impact of the proposed remedies on competition in the market in which it participates.
C. Terms of Participation and Costs 31 National seeks to intervene on the following terms: A To review any discovery transcripts and access any documents of the Parties produced on discovery (subject to any Confidentiality Order issued by the Tribunal), but not participate directly in the discovery process. B To produce an affidavit of relevant documents and to make a representative of National available for examination for discovery on the topics for which National has been granted leave to intervene. C To adduce non-repetitive viva voce evidence at the hearing of the Commissioner's Application relating to the topics for which National has been granted leave to intervene. D To conduct non-repetitive examinations and cross-examination of witnesses on the topics for which National has been granted leave to intervene. E To file expert evidence relating to the topics for which National has been granted leave to intervene within the procedures set out in the Competition Tribunal Rules. F To attend and make representations at any pre-hearing motions, case conferences or scheduling conferences.
G
To make written and oral argument relating to the topics for which National has been granted leave to intervene, including submissions on any proposed remedy.
32 At the hearing, counsel for the Commissioner agreed with the above proposed terms. Both Reliance and Direct Energy object to the wording of some or all of these terms.
33 With respect to the first Term, Direct Energy has stated in its written submissions as follows: National should not be permitted to inspect any documents produced by the parties or review discovery transcripts or any exhibits thereto, except in accordance with a confidentiality Order made by the Tribunal that restricts disclosure of such documents and transcripts to: (i) the topics on which National has been permitted to intervene; and (ii) external counsel for National, after having signed an appropriately worded confidentiality agreement, insofar as the information to be disclosed has been determined by the producing party to be competitively sensitive and/or proprietary;
34 I agree that the review of the transcripts and documents should be limited to the topics on which National has been granted leave to intervene. National has not established why a review of all the discovery transcripts and access to all documents are necessary for the purposes of its intervention. If practical difficulties arise, the parties can work together to address those difficulties, failing which the matter can be addressed at a case management conference.
35 Contrary to the submissions made by Direct Energy and Reliance, it is not necessary to include in Term B a reference to all correspondence between National and the Commissioner. Any dispute between the parties with respect to relevance and privilege can be dealt with at a later stage in accordance with the normal Tribunal procedure and Rules 60 and 61 of the Competition Tribunal Rules.
36 In the circumstances, it is also appropriate to limit the duration of the examination of discovery of National's representative to three hours. It is not necessary to specify that the questions asked be non-repetitive. The Tribunal proceeds on the assumption that all counsel know, and will abide existing rules of practice.
37 With respect to Term C, Direct Energy asks that National only be permitted to deliver the relevant, non-repetitive evidence of one witness. It is premature to arbitrarily limit the number of lay witnesses. However, the Tribunal reserves the right, as part of a future case management proceeding, to limit the number of witnesses to be called by National.
38 The Tribunal finds that Term D is a proper term and dismisses Direct Energy's submissions that National should not be permitted to cross-examine witnesses at the hearing of the main application. Interveners may have the right to cross-examine witnesses at the hearing and Direct Energy has not provided any convincing reason why National should be precluding from exercising this right (see, e.g., American Airlines).
39 Direct Energy further submits that National should not be allowed to lead expert evidence on the basis that the opinion of the expert would not reflect the unique or distinct perspective of National. Reliance submits that National's expert reports should be confined to National's unique perspective (e.g. functional substitutes that may be available to gas or electric water heaters). Counsel for both parties expressed the view at the hearing that it would be improper for National to lead expert evidence with respect to more general topics such as the relevant markets and the effect of the alleged conduct in the market generally.
40 Direct Energy has not provided any decision in support of its position that interveners should not be allowed to lead expert evidence. On the contrary, in various decisions, over the last 20 years, the Tribunal has allowed interveners to do precisely that which Direct Energy opposes (see e.g.: Commissioner of Competition v. Visa Canada Corp., 2011 Comp. Trib. 2 (Competition Trib.); Canada (Commissioner of Competition) v. Toronto Real Estate Board, 2011 Comp. Trib. 22 (Competition Trib.); Canada (Commissioner of Competition) v. Air Canada, 2011 Comp. Trib. 21 (Competition Trib.); Canada (Commissioner of Competition) v. Air Canada, 2001 Comp. Trib. 4 (Competition Trib.); Canada (Director of Investigation & Research) v. Canadian Pacific Ltd. (1997), 74 C.P.R. (3d) 37 (Competition Trib.); Canada (Director of Investigation & Research) v. Tele-Direct (Publications) Inc. (1995), 61 C.P.R. (3d) 528 (Competition Trib.)).
41 Again, it would be premature to place an arbitrary limit on the type and number of expert witnesses National can bring forward. Counsel for National acknowledged at the hearing that it does not yet know what kind of expert evidence it wishes to adduce, if any. However, I note that with respect to presenting such evidence, National should be guided by the principles set forth in subsection 9(2) of the Competition Tribunal Act.
42 With respect to Term F, Reliance submits that it should be confined to instances where National's interests are in issue whereas Direct Energy takes the position that National's representations should be allowed but only to the extent that they are relevant to the issues on which it is permitted to intervene and are not duplicative of the Commissioner's representations.
43 For practical reasons, given the guidelines set out in subsection 9(2) and given the agreement of counsel at the hearing to work together, I find that it is not necessary, at this time, to restrict Term F any further.
44 Counsel for National indicated at the hearing that it is willing to include a reference in Term G, so as to confine it to non-repetitive argument, as long as National has the opportunity to review the Commissioner's filing in advance. Counsel for the Commissioner no longer insisted, at the hearing, on the inclusion of the word "non-repetitive", but Direct Energy, in its written submissions asked that National's argument not be duplicative of that of the Commissioner's.
45 The Tribunal will not engage in micro-managing the content of National's factum. As a practical matter, there must be some repetition in order for the intervener to frame its distinct or unique perspective.
46 Finally, National has indicated that if leave to intervene is granted, it would not seek costs and requests that it not be made liable for the costs of any party or other intervener.
47 Direct Energy submits that National should be subject to the costs provisions in section 8.1 of the Competition Tribunal Act and Reliance argues that it would be premature to order that National will not be liable for costs as this is a decision that should be left to the panel hearing this matter. I agree. I will not fetter the discretion of the panel hearing this matter to award costs as it sees appropriate: Canada (Commissioner of Competition) v. Toronto Real Estate Board, 2011 Comp. Trib. 22 (Competition Trib.), para. 43.
Therefore, the Tribunal Orders as Follows: 48 National is granted leave to intervene on the following topics (hereinafter, the "National Energy Topics"): a) The development of the Ontario rental water heater industry as it relates to National. b) The issue of Direct Energy's anti-competitive acts as they relate to National, including the impact of Direct Energy's exclusionary water heater return policies and procedures and other anti-competitive conduct as alleged in the Commissioner's Application, on the ability of National to effectively compete and expand in the Relevant Market.
c) The impact of Direct Energy's anti-competitive acts on customers or proposed customers of National. d) National's interactions with Direct Energy with respect to the matters at issue in the proceeding, including dealings with Direct Energy regarding the water heater removal and return process.
e) National's perspective as a participant in the industry on the definition of the product and geographic markets as framed by the Commissioner.
f) The issue of Direct Energy's dominant position as it affects National. g) The issue of the substantial lessening or prevention of competition as it relates to National. h) Barriers to entry and ease of entry into the Relevant Market, based on National's experience, including whether Direct Energy's conduct creates artificial barriers to entry and expansion for National or raises National's costs.
i) The statements made and conclusions drawn by Direct Energy concerning National's conduct in the Response of Direct Energy filed in this proceeding.
j) The impact of the Commissioner's proposed remedies on National and on competition in the Relevant Market. 49 National shall be allowed to participate in the proceedings and be permitted: a) To review any discovery transcripts and access any documents of the Parties produced on discovery (subject to any Confidentiality Order issued by the Tribunal), as they relate to the National Energy Topics, but not participate directly in the discovery process.
b) To produce an affidavit of relevant documents and to make a representative of National available for examination for discovery on the National Energy Topics. The discovery shall be limited in time to three (3) hours for Direct Energy.
c) To adduce viva voce evidence at the hearing of the Commissioner's Application relating to the National Energy Topics. d) To conduct examinations and cross-examination of witnesses on the National Energy Topics. e) To file expert evidence relating to the National Energy Topics within the procedures set out in the Competition Tribunal Rules.
f) To attend and make representations at any pre-hearing motions, case conferences or scheduling conferences. g) To make written and oral argument relating to the National Energy Topics, including submissions on any proposed remedy.
50 When exercising the above rights, National shall follow the guidelines found in subsection 9(2) of the Competition Tribunal Act.
51 The number of lay or expert witnesses to be called by National may be limited at a future case management proceeding. 52 The parties shall file a proposed timetable for the disposition of the application on or before Wednesday, November 13, 2013. If the parties cannot agree on a timetable, they shall each serve and file a proposed timetable on or before November 13, 2013. The parties shall consult with National in establishing the timelines.
2011 Comp. Trib. 2 Competition Tribunal
Commissioner of Competition v. Visa Canada Corp. 2011 CarswellNat 6510, 2011 Comp. Trib. 2 In the Matter of the Competition Act, R.S.C. 1985, c. C-34, as amended In the Matter of an application by the Commissioner of Competition pursuant to section 76 of the Competition Act The Commissioner of Competition, (applicant) and Visa Canada Corporation and MasterCard International Incorporated, (respondents) and The Toronto-Dominion Bank The Canadian Bankers Association, (applicants for leave to intervene)
Sandra J. Simpson Chair Heard: March 7, 2011 Judgment: April 5, 2011 Docket: CT-2010-10
Counsel: Kent Thomson, Adam Fanaki, William Miller, David D. Akman, for Applicant, Commissioner of Competition Jeffrey B. Simpson, James Musgrove, for Respondent, MasterCard International Incorporated Robert Kwinter, Randall Hofley, for Respondent, Visa Canada Corporation Mahmud Jamal, Michelle Lally, Jason MacLean, for Applicants, for leave to intervene, The Canadian Bankers Association Paul Morrison, Christine Lonsdale, for Applicants, for leave to intervene, The Toronto-Dominion Bank
Sandra J. Simpson Chair: Introduction 1 The Toronto-Dominion Bank and the Canadian Bankers Association (the "Proposed Intervenors") are moving for leave to intervene in proceedings commenced by the Commissioner of Competition (the "Commissioner") against Visa Canada Corporation ("Visa") and MasterCard International Incorporated ("MasterCard") pursuant to section 76 of the Competition Act, R.S.C. 1985, c. C-34 (the "Act"). This provision deals with price maintenance.
Background 2 Visa and MasterCard do not issue credit cards. Rather, they operate the credit card networks which are used to process credit card transactions. Visa and MasterCard credit cards are issued to shoppers by financial institutions such as banks. They are described as "Issuers" when they perform this function. Some banks also operate as "Acquirers". In this role, they provide services to merchants which allow them to process payments made with Visa and MasterCard credit cards. Acquirers are required by Visa and MasterCard to include certain terms in the agreements they make with merchants. Those terms include provisions which require merchants to accept all Visa and MasterCard credit cards and which prohibit merchants from imposing a surcharge on a shopper who uses a premium credit card. Terms of this kind have been described by the Commissioner as the "Merchant Restraints".
3 In broad terms, the Commissioner's application concerns the fees paid by merchants (the "Card Acceptance Fees") for the ability to accept Visa and MasterCard credit cards when shoppers make retail purchases.
4 The application also deals with the portion of Card Acceptance Fees known as "Interchange Fees". Interchange Fees are retained by Issuers and represent a significant portion of Card Acceptance Fees. The Commissioner asks the Tribunal to order
1
the abolition of the Merchant Restraints (the "Proposed Order") saying that such an order will promote competition in the setting of Card Acceptance Fees. The suggestion is that, if competition is introduced, Card Acceptance Fees will decline.
5 The Commissioner's application raises a number of issues and, based on the pleadings, Visa and MasterCard dispute all the fundamentals of her case. In particular they:
(a) do not agree with her definition of "credit card network services" as the product market; (b) do not agree that section 76 of the Act applies on the facts of this case; (c) characterize the Merchant Restraints as pro-competitive; and (d) forecast negative consequences for their credit card networks and for their cardholders if the Merchant Restraints are abolished.
The Proposed Intervenors 6 Against this background, the Toronto-Dominion Bank ("TD Bank") and the Canadian Bankers Association (the "Association") seek leave to intervene under subsection 9(3) of the Competition Tribunal Act, R.S.C. 1985, c. 19 (2 nd supp.) (the "Tribunal Act").
7 TD Bank is a Schedule I bank incorporated under the Bank Act, S.C. 1991, c. 46. It is one of the largest banks in Canada and it is the only Canadian chartered bank which carries on business as both an Issuer and an Acquirer. If granted leave, TD Bank will support the positions taken by Visa and MasterCard.
8 The Association is a national organization which represents the Canadian banking industry. Its members include 51 domestic chartered banks, subsidiaries of foreign banks, and foreign bank branches operating in Canada. The Association deals with matters of concern to the banking industry as a whole and its main activities are in the fields of legislation, education, publication, public relations, and information. The Association, if granted leave, will also support Visa and MasterCard.
9 Visa and MasterCard are in favour of the interventions but did not make oral submissions on the motions for leave. The Commissioner, on the other hand, argued that both Proposed Intervenors should be denied leave to intervene.
The Development of the Test 10 Subsection 9(3) of the Tribunal Act reads as follows: 9(3). Any person may, with leave of the Tribunal, intervene in any proceedings before the Tribunal, other than proceedings under Part VII.1 of the Competition Act, to make representations relevant to those proceedings in respect of any matter that affects that person
9(3). Toute personne peut, avec l'autorisation du Tribunal, intervenir dans les procédures se déroulant devant celui-ci, sauf celles intentées en vertu de la partie VII. 1 de la Loi sur la concurrence, afin de présenter toutes observations la concernant à l'égard de ces procédures.
11 The first guidance provided by the courts regarding the test for leave to intervene is found in the Federal Court of Appeal decision in Canada (Director of Investigation & Research) v. Air Canada (1988), 54 D.L.R. (4th) 741 (Fed. C.A.), aff'd [1989] 1 S.C.R. 236 (S.C.C.). The Tribunal had concluded that the word "representations" in subsection 9(3) of the Tribunal Act meant that intervenors were only entitled to make submissions. Mr. Justice Iacobucci, as he then was, disagreed. He concluded that, in appropriate cases, the Tribunal could allow intervenors broader rights of participation including a right of discovery, the right to call evidence and the right to cross-examine witnesses.
2
12 In Canada (Director of Investigation & Research) v. Air Canada (1992), 46 C.P.R. (3d) 184 (Competition Trib.), the Tribunal held that the term "affects" in subsection 9(3) of the Tribunal Act means "directly affects". Accordingly, leave to intervene would be denied to a person who might have strong views about the outcome of a case, but would not be affected differently from members of the general public. The Tribunal also concluded that the representations to be made by a proposed intervenor would have to be germane to the mandate of the Tribunal.
13 In Canada (Director of Investigation and Research, Competition Act) v. A.C. Nielsen Company of Canada Ltd., [1994] C.C.T.D. No. 9 (Competition Trib.), the Tribunal refused to grant leave to lawyers who had a particular interest in competition law but who had failed to allege or demonstrate how the proceeding affected them. The Tribunal found that a particular interest in the area of competition law, without more, did not justify leave to intervene.
14 In Canada (Director of Investigation & Research) v. Tele-Direct (Publications) Inc. (1995), 61 C.P.R. (3d) 528 (Competition Trib.), the Tribunal granted leave to intervene to a publisher of a classified telephone directory and two advertising agencies, but refused to grant leave on all their proposed issues because the Director of Investigation and Research had not raised them in his application.
15 In Canada (Director of Investigation & Research) v. Canadian Pacific Ltd. (1997), 74 C.P.R. (3d) 37 (Competition Trib.), the Tribunal held that a proposed intervenor must identify the capacity in which it is directly affected. The Tribunal further held that the representations to be made by a proposed intervenor must be relevant and of assistance to the Tribunal.
16 In Southam Inc. v. Canada (Director of Investigation & Research) (1997), 78 C.P.R. (3d) 315 (Competition Trib.), the Tribunal referred to the requirement that an applicant for intervenor status must bring to the Tribunal a distinct perspective. In that instance, Noël J., as he then was, held that intervenors are intended to "supplement the case of a party by bringing to the Tribunal their own and distinct perspective of the subject matter in dispute" (at p. 319).
17 In Washington v. Canada (Director of Investigation & Research) (1998), 78 C.P.R. (3d) 479 (Competition Trib.), the merging parties sought a variation of a consent order to remove the requirement for a divestiture of certain assets. The variation was on consent and was sought because a new entrant had appeared in the relevant market. The proposed intervenor advised the Tribunal that it would undertake an investigation about the effect of the entry and would put before the Tribunal evidence which might differ from that presented by the parties. The Tribunal denied leave to intervene and held that a proposed intervenor should have a unique and distinct perspective and should be able to satisfy the Tribunal that it had facts to present without conducting a "fishing expedition".
18 Lastly, the Tribunal also has provided guidance about requests for leave to intervene made by associations. In Canada (Competition Act, Director of Investigation and Research) v. The D & B Companies of Canada Ltd., [1994] C.C.T.D. No. 19 (Competition Trib.), McKeown J. held that the Canadian Council of Grocery Distributors was directly affected because it was sufficient that there were matters in issue that would directly affect the persons it represented. In the Tribunal's view, having the association as the sole intervenor would be more efficient than requiring each individual retailer to appear independently. Similarly, in Canada (Director of Investigation & Research) v. Bank of Montreal (1996), 66 C.P.R. (3d) 409 (Competition Trib.), the Tribunal granted intervenor status to two associations, the Retail Council of Canada and the Canadian Life and Health Insurance Association Inc., noting (at para. 7) that the "association provides a convenient and efficient means of representing the many affected persons in a coherent way before the Tribunal".
The Test 19 In Canada (Commissioner of Competition) v. Canadian Waste Services Holdings, 2000 Comp. Trib. 9 (Competition Trib.), Mr. Justice McKeown reviewed the above case law and listed the requirements to be met by a proposed intervenor. They are:
(a) The matter alleged to affect that person seeking leave to intervene must be legitimately within the scope of the Tribunal's consideration or must be a matter sufficiently relevant to the Tribunal's mandate (see Canada (Director of Investigation &
3
Research) v. Air Canada 46 C.P.R. (3d) 184 at 187, Canada (Director of Investigation & Research) v. Air Canada [1992] C.C.T.D. No. 24).
(b) The person seeking leave to intervene must be directly affected. The word "affects" has been interpreted in Air Canada, ibid., to mean "directly affects".
(c) All representations made by a person seeking leave to intervene must be relevant to an issue specifically raised by the Commissioner (see Tele-Direct).
(d) Finally, the person seeking leave to intervene must bring to the Tribunal a unique or distinct perspective that will assist the Tribunal in deciding the issues before it (see Washington v. Canada (Director of Investigation & Research) [1998] C.C.T.D. No. 4).
The Proposed Intervenors' Evidence 20 TD Bank's motion for leave to intervene is supported by a joint affidavit sworn on February 9, 2011, by Jim Sallas, Senior Vice-President, Personal Lending and Credit Cards, and by Jeff van Duynhoven, President of Merchant Services (the "Bank's Affidavit"). None of the parties challenged the joint format or cross-examined the deponents.
21 The deponents say that TD Bank is directly affected by the proceedings in its dual roles as Issuer and Acquirer and also in its overall banking business. They say that if the Merchant Restraints are removed, there will be significant migration away from credit cards to other forms of payment. This change would directly impact TD Bank as an Issuer and as an Acquirer and, if its customers' credit cards were refused, those refusals might negatively affect its overall banking business.
22 The deponents also say that TD Bank brings a distinct and unique perspective to the proceedings because of its dual roles. They note that Visa and MasterCard generally do not have any direct interaction with cardholders and say that they can neither explain the costs associated with the creation of features and benefits associated with TD Bank's credit cards nor detail the role played by Card Acceptance Fees in the viability of TD Bank's issuing business.
23 Mr. Sallas and Mr. van Duynhoven also believe that the Commissioner's application will affect Canada's entire payments system and that the credit card networks cannot and should not be examined by the Tribunal in isolation from their place in Canada's overall payments system.
24 The Association has filed the affidavit of Darren Hannah, Director of Banking Operations for the Association, sworn on February 10, 2011. Mr. Hannah was not cross-examined.
25 He says that the Association's 51 member banks are key participants in the Canadian credit card system as the principal customers of the Respondents' credit card networks and as credit card issuers both large and small. He adds that the Association's member banks also have significant commercial relationships with their personal and commercial retail banking customers, including cardholders. He notes that some member banks have an interest in the business of acquiring credit card transactions and some operate their own acquiring businesses.
26 He also says that the member banks issue approximately 90% of the credit cards in use in Canada and that from the banks' perspective as issuers of credit cards to consumers and businesses, the Merchant Restraints are critical to the efficiency, integrity, and reliability of Canada's credit card networks.
The Issues 27 On the facts presented on these motions, the questions for determination are: 1. Are the TD Bank and the Association's members directly affected by the Commissioner's application? And, if so, 2. Are the topics they wish to address relevant to issues raised in the Commissioner's application? And, if so,
4
3. Are the TD Bank and the Association in a unique or distinct position to address those topics and will their participation assist the Tribunal?
4. Finally, if leave is granted what should be the extent of the intervenors' participation before and during the hearing? Question 1 — Are the Proposed Intervenors Directly Affected? The TD Bank 28 TD Bank says that the Merchant Restraints are found in all its contracts with merchants and that it is directly affected because the abolition of the Merchant Restraints will effectively rewrite the contracts it holds as an Acquirer. TD Bank also functions as an Issuer and says that, if the Merchant Restraints are eliminated and its customers' credit cards are refused by merchants, it will be directly affected because customers will make less use of their cards, fewer Card Acceptance Fees will be paid by merchants and customers may blame the bank for their inability to use their credit cards.
29 The Commissioner submits that the impacts foreseen by TD Bank are merely speculative predictions and, as such, do not meet the requirement to show a definite impact. She says that that requirement is found in Burns Lake Native Development Corp. v. Canada (Commissioner of Competition), 2006 Comp. Trib. 16 (Competition Trib.), ("Burns Lake"). Burns Lake dealt with whether a party had standing to challenge a registered consent agreement under section 106 of the Act. In my view, the reasoning in Burns Lake does not apply to requests for intervenor status under subsection 9(3) of the Tribunal Act because the context for the applications is entirely different. In section 106 challenges, the registered consent agreement has ended a dispute and has imposed remedies for alleged anti-competitive conduct. It is therefore reasonable to require a party challenging the agreement to be certain about its impact.
30 The situation for those seeking leave to intervene under subsection 9(3) of the Tribunal Act is very different. Proposed intervenors are required to apply for leave to intervene ten days after a response is filed to a Commissioner's application. At that point, since the Commissioner has a right of reply, the pleadings are not closed and the hearing of the application is at a future date. In these circumstances, it is not reasonable to require a proposed intervenor to be completely certain about the ways in which it might be affected by the relief sought by the Commissioner. Some speculation is acceptable.
31 The Commissioner also says that the Proposed Order will have an impact on the 670,000 merchants who accept credit cards and on the 20 million Canadians who hold such cards. For this reason she says that the fact that TD Bank is a party to contracts with merchants and cardholders should not justify an intervention because it is not affected in a manner which is different from a vast number of Canadians and Canadian businesses.
32 However, the fact that many Canadians hold credit cards from Issuers and numerous merchants deal with Acquirers does not mean that the banks which offer contracts to those cardholders and merchants are not directly affected in their businesses of issuing and acquiring if those contracts are to change as a result of the Proposed Order.
33 TD Bank also says it is directly affected by what it describes as the allegations of anticompetitive behaviour found in paragraph 12 of the Commissioner's application. There she states that Acquirers are required by Visa and MasterCard to include the Merchant Restraints in their contracts with merchants. Then, in paragraphs 14, 47, 48 and 58, the Commissioner asserts that the Merchant Restraints are anti-competitive. TD Bank says that, because it is an Acquirer, these paragraphs, taken together, allege anti-competitive behaviour on its part.
34 In my view, this submission is not sound. No remedy is sought against TD Bank or any other Acquirer. TD Bank is not named as a party and no impropriety is suggested. Rather, the pleadings, as a whole, make it clear that, in the Commissioner's view, Acquirers and merchants, who make agreements which include the Merchants Restraints, have no alternative but to agree to their inclusion because they have no bargaining power. Further, the Commissioner's counsel confirmed in the hearing that no allegations were made against TD Bank. Accordingly, there are no allegations of anti-competitive conduct to underpin this submission that TD Bank is directly affected.
5
35 TD Bank has a third reason for alleging that it is directly affected. It says that it provides full banking services to many of the cardholders it deals with as an Issuer. It submits that if the Merchant Restraints are removed, TD Bank's customers who hold credit cards issued by the bank might re-evaluate their overall banking relationship with the bank when merchants refuse those cards.
36 I have not accepted this submission as evidence of a direct effect which justifies an intervention. In my view, if cardholders are apprehensive about the Proposed Order and its impact on their overall banking relationships, that information must come from them.
Conclusion — TD Bank 37 Although I have rejected two of TD Bank's reasons for saying that it is directly affected, I am persuaded by its initial submission that it is directly affected by reason of its businesses as Issuer and Acquirer.
The Canadian Bankers Association 38 The Commissioner again says that the Association only speculates about the impact of the Proposed Order on the Association's members and that speculation cannot support an application for leave to intervene.
39 For the reasons given above some speculation is permissible. However, in my view, the Association's evidence is not speculative. Mr. Hannah's affidavit shows that the Association is certain that cardholders will complain to Issuers and cancel their credit cards if these cards are refused by merchants.
40 As well, two of the Association's members have a 50% interest in Acquirer businesses and, as discussed earlier, their contracts with merchants will change if the Proposed Order is made.
Conclusion — The Association 41 I accept the Association's evidence and am satisfied that many of its members are directly affected. Question 2 — Are the Proposed Intervenors' Proposed Topics Relevant? 42 During the hearing, counsel for each of the Proposed Intervenors was asked to list the topics their clients wished to address if given leave to intervene.
43 The TD Bank's proposed topics are: 1. Interactions the bank has with merchants in its role as an Acquirer; 2. Interactions the bank has with cardholders in its role as an Issuer; 3. The bank's interactions with Visa and MasterCard in its dual roles as Issuer and Acquirer; 4. The impact of the Proposed Order on the payments system; 5. The impact of the Proposed Order on TD Bank's business as an Issuer and as an Acquirer; 6. TD Bank's perceptions of the impact of the Proposed Order on its merchant and cardholder customers; 7. TD Bank's view of the reasons for the Merchant Restraints. 44 The Association wishes to address the following topics from the multiple perspectives of its members: 1. The competitiveness of the payments system and the benefits it provides to all its participants;
6
2. How the Merchant Restraints are pro-competitive and critical to the efficiency, integrity and reliability of the Visa and MasterCard credit card networks;
3. The role of Card Acceptance Fees from the perspective of the Issuer; 4. The impact of the Proposed Order on benefits and services Issuers provide to cardholders; 5. The reasons why section 76 of the Act does not apply on the facts of this case. 6. The impact of the Proposed Order on Issuers, Acquirers, merchants and cardholders. General Observations — The Relevance of the Business of Issuers and of the Canadian Payments System 45 The Commissioner's case does not center on the business of issuing credit cards. However, the Bank's Affidavit shows that it seeks to expand the hearing to have the Tribunal consider all aspects of the business including its costs and the services it provides to cardholders. As well, the Association says that the Tribunal must consider the competitiveness of the payments system because the Proposed Order will affect the system as a whole.
46 I have concluded that it is not appropriate to permit the Proposed Intervenors to expand the hearing to deal extensively with matters which are not the subject of allegations by the Commissioner. Accordingly, the Proposed Intervenors will not be given leave to adduce general broad-based evidence about the business of issuing credit cards or about the operation of the Canadian payments system. However, there is room for limited evidence on these topics for the reasons given below.
47 The Commissioner deals with the impact of the Proposed Order on Issuers in her Application at paragraphs 48, 58, 71 and 73 and in her Reply at paragraphs 57-59, 61 and 83. She alleges that, with the Proposed Order, there will be an incentive for Issuers to compete with one another by issuing credit cards with reduced Interchange Fees so that merchants will accept their cards without surcharges. In view of this allegation, it would be relevant for the Proposed Intervenors to adduce evidence about the likely impact of the Proposed Order on Interchange Fees.
48 Turning to the payments system, the Commissioner asks for a discretionary order and both Visa and MasterCard have said that, even if price maintenance is established, the Tribunal should not exercise its discretion in favour of the order. For this reason, the impact of the Proposed Order on the payments system is relevant.
Question 2 (cont'd) and 3 — Relevance, Uniqueness and Assistance 49 I now turn to the specific topics suggested by the Proposed Intervenors. TD Bank Proposed Topic 1 The interactions between TD Bank acting as an Acquirer and merchants is a relevant topic and, in my view, the bank is in a position to provide a unique firsthand perspective which will assist the Tribunal. Accordingly, its intervention on this topic will be allowed. Proposed Topic 2 However, as discussed above, a broad intervention dealing with TD Bank's business as an Issuer and its interactions with cardholders is not relevant. Proposed Topic 3 TD Bank's interactions with Visa and MasterCard in its role as an Acquirer is also relevant and its firsthand evidence on this topic is likely to assist the Tribunal. Accordingly, leave will be given to intervene on this aspect of topic 3. However, as discussed above, a broad intervention dealing with TD Bank's interactions with Visa and MasterCard in its role as an Issuer is not relevant. However, a narrower intervention focussed on the setting of Interchange Fees would assist the Tribunal. Proposed Topic 4 The impact of the Proposed Order on the payments system is relevant. The Association has not listed this as a topic and it appears that Visa
7
Proposed Topic 5
Proposed Topic 6
Proposed Topic 7
Proposed Topic 1
Proposed Topic 2
Proposed Topic 3
Proposed Topic 4
Proposed Topic 5
Proposed Topic 6
and MasterCard will focus on the impact of the order on their credit card networks. Accordingly, an intervention on this topic will assist the Tribunal. Firsthand evidence about the impact of the Proposed Order on TD Bank's business as an Issuer and Acquirer is relevant and, in my view, will assist the Tribunal as long as it does not duplicate the Association's evidence on this topic. The impact of the Proposed Order on merchants and cardholders is relevant. However, TD Bank has no direct evidence to offer on this issue. It only proposes to give the Tribunal the benefit of its "perceptions". In my view, evidence of this nature will not assist the Tribunal and this intervention will not be permitted. TD Bank is not the author of the Merchant Restraints and is not responsible for their imposition. Accordingly, it is not uniquely placed to address the reasons for their use. Evidence on this topic will presumably come from Visa and MasterCard. Further, to the extent that TD Bank raised this topic to respond to perceived allegations of anti-competitive conduct, such a response, as noted above, is not required since no such allegations were made. The Association For the reasons given above, I have concluded that general evidence about the competitiveness and benefits of the Canadian payment services market is not relevant. Whether or not the Merchant Restraints are pro-competitive and what role they play in the provision of credit card networks are relevant topics. However, Visa and MasterCard will address these issues and are in the best position to do so since they impose the restraints and operate the networks. The Association does not offer a unique perspective on these topics. Accordingly, an intervention on this topic will not be permitted. The Issuers' perspective on the role of Card Acceptance Fees and, in particular, Interchange Fees is relevant. It cannot be addressed by Visa and MasterCard and it is not on TD Bank's list of topics. Accordingly, intervention on this issue is appropriate. As mentioned earlier, the impact of the Proposed Order on Interchange Fees is relevant. As well, the impact of the Proposed Order on benefits and services available to cardholders is also relevant. These topics are included in Topic 6 below. The application of section 76 of the Act to the facts of this case is, of course, relevant. However, it will he addressed by Visa and MasterCard. Accordingly, an intervention on this issue is not warranted. The impact of the Proposed Order on Issuers, Acquirers, merchants and cardholders is relevant. However, the Association does not have merchants and cardholders among its members so any evidence about their views of the impact would be entirely speculative and will therefore not assist the Tribunal. However, views of the Association's members about the impact of the Proposed Order on Issuers and Acquirers may well assist the Tribunal. An intervention will be permitted on this topic but only to the extent that the evidence and the submissions do not duplicate those made by the TD Bank. ORDER
50 For the reasons given above, TD Bank is given leave to intervene to address the following topics: A. Its interactions with merchants as an Acquirer.
8
B. Its interactions with Visa and MasterCard as an Acquirer. C. Its interactions with Visa and MasterCard as an Issuer as those interactions relate to Interchange Fees. D. The impact of the Proposed Order on the payments system. E. The impact of the Proposed Order on its business as an Issuer and an Acquirer to the extent that there is no duplication with the Association's evidence and submissions.
51 For the reasons given above, the Association is given leave to intervene on the following topics: A. The Issuer's perspective on the role of Card Acceptance Fees. B. The impact of the Proposed Order on Issuers and Acquirers to the extent that there is no duplication with the TD Bank's evidence and submissions.
Question 4 — The Scope of the Interventions 52 Having determined that the Proposed Intervenors have relevant evidence to offer, the question is how to structure their interventions so that they effectively assist the Tribunal without unduly lengthening the proceeding or unduly interfering with the lis between the Commissioner and Visa and MasterCard.
53 To achieve these objectives, the Tribunal orders that: (i) The intervenors must proceed according to the schedule for the case agreed to by the parties in a letter to the Tribunal from Blakes dated March 29, 2011 as it relates to the Respondents.
(ii) Subject to any orders dealing with confidentiality, the intervenors are to be served with the parties' productions and affidavits of documents as they become available.
(iii) The intervenors are to produce the documents relevant to the topics of their respective interventions and deliver affidavits of documents on or before August 15, 2011.
(iv) The intervenors have not asked for oral discovery of a representative of the Commissioner. They may not attend such discoveries but may, as requested, review those transcripts.
(v) If the Commissioner wishes to discover a representative of each of the intervenors, she may do so. However, her right to discovery is limited to the topics on which each has been given leave to intervene and is also limited in time to three (3) hours for the representative of the TD Bank and two (2) hours for the Association's representative.
(vi) TD Bank may call a maximum of three witnesses and the Association may call a maximum of two witnesses at the hearing. Those limits include any experts the intervenors may wish to call.
(vii) At the hearing, the intervenors' counsel may cross-examine the Commissioner's witnesses only on the topics of their respective interventions. When cross-examining, counsel may not repeat questions already asked by any other counsel.
(viii) Intervenors may make written and oral argument which is not repetitive. (ix) When the Chess Clock timing is established, the intervenors will be given distinct time allotments. In other words, the Commissioner's suggestion that their time be deducted from the time allotted to Visa and MasterCard is not accepted.
54 There is no order as to costs.
9
CONSOLIDATION
Competition Act
R.S.C., 1985, c. C-34
Current to June 20, 2022 Last amended on July 1, 2020
CANADA
Published by the Minister of Justice at the following address: http://laws-lois.justice.gc.ca
CODIFICATION
Loi sur la concurrence
L.R.C. (1985), ch. C-34
À jour au 20 juin 2022 Dernière modification le 1 juillet 2020
Publié par le ministre de la Justice à l’adresse suivante : http://lois-laws.justice.gc.ca
Competition PART VIII Matters Reviewable by Tribunal Agreements or Arrangements that Prevent or Lessen Competition Substantially Sections 90.1-92
(b) an order against that person is sought by the Com- missioner under section 76, 79 or 92.
Definition of competitor (11) In subsection (1), competitor includes a person who it is reasonable to believe would be likely to compete with respect to a product in the absence of the agreement or arrangement.
2009, c. 2, s. 429; 2018, c. 8, s. 115; 2018, c. 10, s. 87. Mergers
Definition of merger 91 In sections 92 to 100, merger means the acquisition or establishment, direct or indirect, by one or more per- sons, whether by purchase or lease of shares or assets, by amalgamation or by combination or otherwise, of control over or significant interest in the whole or a part of a business of a competitor, supplier, customer or other person.
R.S., 1985, c. 19 (2nd Supp.), s. 45.
Order 92 (1) Where, on application by the Commissioner, the Tribunal finds that a merger or proposed merger pre- vents or lessens, or is likely to prevent or lessen, competi- tion substantially
(a) in a trade, industry or profession, (b) among the sources from which a trade, industry or
profession obtains a product, (c) among the outlets through which a trade, industry or profession disposes of a product, or
(d) otherwise than as described in paragraphs (a) to (c),
the Tribunal may, subject to sections 94 to 96, (e) in the case of a completed merger, order any party to the merger or any other person
(i) to dissolve the merger in such manner as the Tribunal directs,
(ii) to dispose of assets or shares designated by the Tribunal in such manner as the Tribunal directs, or
Current to June 20, 2022 Last amended on July 1, 2020
120
Concurrence PARTIE VIII Affaires que le Tribunal peut examiner Accords ou arrangements empêchant ou diminuant sensiblement la concurrence Articles 90.1-92
b) d’une ordonnance demandée par le commissaire à l’endroit de cette personne en vertu des articles 76, 79 ou 92.
Définition de concurrent (11) Au paragraphe (1), concurrent s’entend notamment de toute personne qui, en toute raison, ferait vrai-semblablement concurrence à une autre personne à l’égard d’un produit en l’absence de l’accord ou de l’ar-
rangement. 2009, ch. 2, art. 429; 2018, ch. 8, art. 115; 2018, ch. 10, art. 87. Fusionnements
Définition de fusionnement 91 Pour l’application des articles 92 à 100, fusionne-ment désigne l’acquisition ou l’établissement, par une ou plusieurs personnes, directement ou indirectement, soit par achat ou location d’actions ou d’éléments d’actif, soit par fusion, association d’intérêts ou autrement, du contrôle sur la totalité ou quelque partie d’une entreprise d’un concurrent, d’un fournisseur, d’un client, ou d’une
autre personne, ou encore d’un intérêt relativement important dans la totalité ou quelque partie d’une telle en-treprise.
L.R. (1985), ch. 19 (2 e suppl.), art. 45. Ordonnance en cas de diminution de la concurrence 92 (1) Dans les cas où, à la suite d’une demande du commissaire, le Tribunal conclut qu’un fusionnement réalisé ou proposé empêche ou diminue sensiblement la concurrence, ou aura vraisemblablement cet effet :
a) dans un commerce, une industrie ou une profes-sion;
b) entre les sources d’approvisionnement auprès desquelles un commerce, une industrie ou une profession se procure un produit;
c) entre les débouchés par l’intermédiaire desquels un commerce, une industrie ou une profession écoule un produit;
d) autrement que selon ce qui est prévu aux alinéas a) à c),
le Tribunal peut, sous réserve des articles 94 à 96 :
e) dans le cas d’un fusionnement réalisé, rendre une ordonnance enjoignant à toute personne, que celle-ci
soit partie au fusionnement ou non : (i) de le dissoudre, conformément à ses directives,
À jour au 20 juin 2022 Dernière modification le 1 juillet 2020
Competition PART VIII Matters Reviewable by Tribunal Mergers Sections 92-93
(iii) in addition to or in lieu of the action referred to in subparagraph (i) or (ii), with the consent of the person against whom the order is directed and the Commissioner, to take any other action, or
(f) in the case of a proposed merger, make an order directed against any party to the proposed merger or any other person
(i) ordering the person against whom the order is directed not to proceed with the merger,
(ii) ordering the person against whom the order is directed not to proceed with a part of the merger, or
(iii) in addition to or in lieu of the order referred to in subparagraph (ii), either or both
(A) prohibiting the person against whom the or- der is directed, should the merger or part thereof be completed, from doing any act or thing the
prohibition of which the Tribunal determines to be necessary to ensure that the merger or part thereof does not prevent or lessen competition substantially, or
(B) with the consent of the person against whom the order is directed and the Commissioner, or- dering the person to take any other action.
Concurrence PARTIE VIII Affaires que le Tribunal peut examiner Fusionnements Articles 92-93
(ii) de se départir, selon les modalités qu’il indique, des éléments d’actif et des actions qu’il indique,
(iii) en sus ou au lieu des mesures prévues au sous-alinéa (i) ou (ii), de prendre toute autre mesure, à
condition que la personne contre qui l’ordonnance est rendue et le commissaire souscrivent à cette mesure;
f) dans le cas d’un fusionnement proposé, rendre, contre toute personne, que celle-ci soit partie au fusionnement proposé ou non, une ordonnance enjoi-gnant :
(i) à la personne contre laquelle l’ordonnance est rendue de ne pas procéder au fusionnement,
(ii) à la personne contre laquelle l’ordonnance est rendue de ne pas procéder à une partie du fusion-nement,
(iii) en sus ou au lieu de l’ordonnance prévue au sous-alinéa (ii), cumulativement ou non :
(A) à la personne qui fait l’objet de l’ordon-nance, de s’abstenir, si le fusionnement était
éventuellement complété en tout ou en partie, de faire quoi que ce soit dont l’interdiction est, selon ce que conclut le Tribunal, nécessaire pour que le fusionnement, même partiel, n’empêche ni ne diminue sensiblement la concurrence,
(B) à la personne qui fait l’objet de l’ordonnance de prendre toute autre mesure à condition que le commissaire et cette personne y souscrivent.
Evidence (2) For the purpose of this section, the Tribunal shall not find that a merger or proposed merger prevents or lessens, or is likely to prevent or lessen, competition sub- stantially solely on the basis of evidence of concentration or market share.
R.S., 1985, c. 19 (2nd Supp.), s. 45; 1999, c. 2, s. 37.
Factors to be considered regarding prevention or lessening of competition
93 In determining, for the purpose of section 92, whether or not a merger or proposed merger prevents or lessens, or is likely to prevent or lessen, competition sub- stantially, the Tribunal may have regard to the following factors:
(a) the extent to which foreign products or foreign competitors provide or are likely to provide effective competition to the businesses of the parties to the merger or proposed merger;
Current to June 20, 2022 Last amended on July 1, 2020
121
Preuve (2) Pour l’application du présent article, le Tribunal ne conclut pas qu’un fusionnement, réalisé ou proposé, em-pêche ou diminue sensiblement la concurrence, ou qu’il aura vraisemblablement cet effet, en raison seulement de la concentration ou de la part du marché.
L.R. (1985), ch. 19 (2 e suppl.), art. 45; 1999, ch. 2, art. 37.
Éléments à considérer
93 Lorsqu’il détermine, pour l’application de l’article 92, si un fusionnement, réalisé ou proposé, empêche ou di-minue sensiblement la concurrence, ou s’il aura vraisem-blablement cet effet, le Tribunal peut tenir compte des facteurs suivants :
a) la mesure dans laquelle des produits ou des concurrents étrangers assurent ou assureront vrai-semblablement une concurrence réelle aux entreprises des parties au fusionnement réalisé ou proposé;
À jour au 20 juin 2022 Dernière modification le 1 juillet 2020
CONSOLIDATION
Competition Tribunal Act
R.S.C. 1985, c. 19 (2nd Supp.)
NOTE [1986, c. 26, assented to 17th June, 1986]
Current to June 20, 2022 Last amended on November 1, 2014
CANADA
Published by the Minister of Justice at the following address: http://laws-lois.justice.gc.ca
CODIFICATION
Loi sur le Tribunal de la concurrence
S.R.C. 1985, ch. 19 (2
e suppl.)
NOTE [1986, ch. 26, sanctionné le 17 juin 1986]
À jour au 20 juin 2022 Dernière modification le 1 novembre 2014
Publié par le ministre de la Justice à l’adresse suivante : http://lois-laws.justice.gc.ca
Competition Tribunal PART I Competition Tribunal Act Jurisdiction and Powers of the Tribunal Sections 8.1-10
Her Majesty in right of Canada in respect of the services so rendered.
Amounts to Receiver General (5) Any money or costs awarded to Her Majesty in right of Canada in a proceeding in respect of which this section applies shall be paid to the Receiver General.
Tribunal de la concurrence PARTIE I Tribunal de la concurrence Compétence et pouvoirs du Tribunal Articles 8.1-10
pour toute autre raison, admis à recouvrer de Sa Majesté du chef du Canada les frais pour les services ainsi rendus.
Versement au receveur général (5) Les sommes d’argent ou frais accordés à Sa Majesté du chef du Canada sont versés au receveur général.
2002, ch. 16, art. 17.
2002, c. 16, s. 17.
Court of record 9 (1) The Tribunal is a court of record and shall have an official seal which shall be judicially noticed.
Proceedings (2) All proceedings before the Tribunal shall be dealt with as informally and expeditiously as the circum- stances and considerations of fairness permit.
Interventions by persons affected (3) Any person may, with leave of the Tribunal, inter- vene in any proceedings before the Tribunal, other than proceedings under Part VII.1 of the Competition Act, to make representations relevant to those proceedings in respect of any matter that affects that person.
Summary dispositions (4) On a motion from a party to an application made un- der Part VII.1 or VIII of the Competition Act, a judicial member may hear and determine the application in a summary way, in accordance with any rules on summary dispositions.
Decision (5) The judicial member may dismiss the application in whole or in part if the member finds that there is no gen- uine basis for it. The member may allow the application in whole or in part if satisfied that there is no genuine ba- sis for the response to it.
Cour d’archives 9 (1) Le Tribunal est une cour d’archives et il a un sceau officiel dont l’authenticité est admise d’office.
Procédures (2) Dans la mesure où les circonstances et l’équité le per-mettent, il appartient au Tribunal d’agir sans formalisme, en procédure expéditive.
Intervention des personnes touchées (3) Toute personne peut, avec l’autorisation du Tribunal, intervenir dans les procédures se déroulant devant celui-ci, sauf celles intentées en vertu de la partie VII.1 de la Loi sur la concurrence, afin de présenter toutes observa-tions la concernant à l’égard de ces procédures.
Procédure sommaire (4) Sur requête d’une partie à une demande présentée en vertu des parties VII.1 ou VIII de la Loi sur la concur-rence et en conformité avec les règles sur la procédure sommaire, un juge peut entendre la demande et rendre une décision à son égard selon cette procédure.
Pouvoirs du juge (5) Le juge saisi de la requête peut rejeter ou accueillir, en totalité ou en partie, la demande s’il est convaincu que, soit la demande, soit la réponse, n’est pas véritable-ment fondée.
L.R. (1985), ch. 19 (2 e
suppl.), art. 9; 1999, ch. 2, art. 42; 2002, ch. 16, art. 18.
R.S., 1985, c. 19 (2nd Supp.), s. 9; 1999, c. 2, s. 42; 2002, c. 16, s. 18.
Organization of Work
Sittings of Tribunal 10 (1) Subject to section 11, every application to the Tri- bunal shall be heard before not less than three or more than five members sitting together, at least one of whom is a judicial member and at least one of whom is a lay member.
Judicial member to preside at hearings (2) The Chairman shall designate a judicial member to preside at any hearing or, if the Chairman is present at a hearing, may preside himself.
Current to June 20, 2022 Last amended on November 1, 2014
5
Organisation du Tribunal
Séances du Tribunal 10 (1) Sous réserve de l’article 11, toute demande présentée au Tribunal est entendue par au moins trois mais au plus cinq membres siégeant ensemble et, parmi les-quels il doit y avoir au moins un juge et un autre membre.
Président de séance (2) Le président désigne, pour chaque séance du Tribu-nal, un juge à titre de président, mais s’il est présent, il peut lui-même la présider.
À jour au 20 juin 2022 Dernière modification le 1 novembre 2014
TAB 5
CONSOLIDATION
Competition Tribunal Rules
SOR/2008-141
Current to June 20, 2022
CANADA
Published by the Minister of Justice at the following address: http://laws-lois.justice.gc.ca
CODIFICATION
Règles du Tribunal de la concurrence
DORS/2008-141
À jour au 20 juin 2022
Publié par le ministre de la Justice à l’adresse suivante : http://lois-laws.justice.gc.ca
Competition Tribunal Rules PART 2 Contested Proceedings Intervention Sections 43-44
Service and filing motion 43 (1) A motion for leave to intervene shall be made by
(a) serving on each of the parties a motion for leave to intervene and an affidavit setting out the facts on which the motion is based; and
(b) filing the motion and the affidavit with proof of service.
Content (2) A motion for leave to intervene shall set out
(a) the title of the proceedings in which the person making the motion wishes to intervene;
(b) the name and address of that person; (c) a concise statement of the matters in issue that af- fect that person and the unique or distinct perspective that the person will bring to the proceeding;
(d) a concise statement of the competitive conse- quences arising from the matters referred to in para- graph (c) with respect to which that person wishes to make representations;
(e) the name of the party, if any, whose position that person intends to support;
(f) the official language to be used by that person at the hearing of the motion and, if leave is granted, in the proceedings; and
Règles du Tribunal de la concurrence PARTIE 2 Instances contestées Intervention Articles 43-44
Signification et dépôt 43 (1) La requête se fait :
a) d’une part, par la signification, à chaque partie, de la requête et d’un affidavit faisant état des faits sur les-quels elle se fonde;
b) d’autre part, par le dépôt de la requête et de l’affi-davit avec la preuve de leur signification.
Contenu (2) Elle comporte les renseignements suivants :
a) le titre de l’instance dans laquelle la personne qui a présenté la requête souhaite intervenir;
b) les nom et adresse de la personne; c) un résumé des questions en litige qui la touchent et la perspective particulière qu’elle apporte à l’instance;
d) un résumé des conséquences pour la concurrence
découlant des questions visées à l’alinéa c) et à propos desquelles elle souhaite présenter des observations;
e) le nom de la partie dont elle a l’intention d’appuyer la position, le cas échéant;
f) la langue officielle qu’elle entend utiliser à l’au-dience relative à la requête et, si la requête est ac-
cueillie, celle qu’elle entend utiliser dans l’instance; g) la façon dont elle se propose de participer à l’ins-tance.
(g) a description of how that person proposes to participate in the proceedings.
Disposition without hearing (3) A person filing a motion for leave to intervene may request in writing that the Tribunal dispose of the motion without a hearing.
Response 44 (1) A party served with a motion for leave to inter- vene may, within 14 days after that service, serve a re- sponse to the motion on the person making the motion and on each of the parties and shall file any response to the motion with proof of service.
Content (2) A response to a motion for leave to intervene shall
(a) deal with the matters raised in the motion; and
Current to June 20, 2022
15
Trancher sans audience (3) La personne qui présente la requête peut demander au Tribunal, par écrit, qu’il la tranche sans tenir d’au-dience.
Réponse 44 (1) Toute partie peut, dans les quatorze jours suivant la signification d’une requête en autorisation d’interve-nir, signifier une réponse à la personne qui a présenté la requête et à chacune des autres parties, auquel cas elle dépose sa réponse avec la preuve de sa signification.
Contenu (2) La réponse à la requête :
a) d’une part, traite des points soulevés dans la re-quête;
À jour au 20 juin 2022
CT-2022-002
THE COMPETITION TRIBUNAL IN THE MATTER OF an a pplication Commissioner of C ompetition f or one orders pursuant to s ection 92 Competition Act, RSC 1 985, c C-34.
by the or more of the
B E T W E E N: COMMISSIONER OF C OMPETITION Applicant - a nd - ROGERS COMMUNICATIONS INC. AND SHAW COMMUNICATIONS INC.
Respondents
BOOK OF AUTHORITIES
Department of Justice Canada Competition Bureau Legal Services Place du Portage, Phase I 50 Victoria Street, 22 nd Floor Gatineau QC K1A 0C9
Ryan Caron Kevin Hong
Tel: 819-956-6891 Fax: 819-953-9267
ryan.caron@cb-bc.gc.ca kevin.hong@cb-bc.gc.ca Counsel to the Commissioner of Competition