On April 2, 2014 the Competition Bureau (the “Bureau”) released a draft update of its Intellectual Property Enforcement Guidelines (“IP Guidelines”) for public consultation. First released in 2000, the IP Guidelines articulate how the Bureau approaches the interface between competition policy and intellectual property (“IP”) rights, and describe how the Bureau will determine whether conduct involving IP raises an issue under the Competition Act (the “Act”). The draft update contains revisions that reflect amendments to the Act that were introduced in 2009 and 2010 and incorporates the Bureau’s recent enforcement experience. Revisions were also made to bring the IP Guidelines in-line with other enforcement guidelines released since 2000. Other than the revisions reflecting legislative amendments, the update does not represent a significant change in respect of the substantive content of the IP Guidelines.

On the same day, the Bureau and the Canadian Intellectual Property Office (“CIPO”) signed a memorandum of understanding (“MOU”) to enhance their mutual interests and to develop a framework for mutual cooperation to assist in the delivery of their respective mandates.


In the IP Guidelines, IP rights include rights granted under the Copyright Act, the Patent Act, the Trade-Marks Act, the Industrial Design Act, the Integrated Circuit Typography Act and the Plant Breeders’ Rights Act. The IP Guidelines identify two broad categories of circumstances in which the Bureau may apply the Act to conduct involving IP or IP rights:

  1. those involving something more than the mere exercise of the IP right, which are addressed by the general analytical framework of the Act, and
  2. those involving the mere exercise of the IP right and nothing else, which are addressed by special remedies under section 32 of the Act.

There is no presumption of anti-competitive conduct in either case.

The mere exercise of an IP right (i.e. the exercise of the owner’s right to unilaterally exclude others from using the IP) is not a cause for concern under the general provisions of the Act, no matter to what degree competition is affected. However, the general provisions of the Act will apply when IP rights form the basis of an arrangement or agreement among independent entities to use or enforce IP rights, such that the alleged competitive harm stems from such an arrangement/agreement and not just from the mere exercise of the IP right and nothing else. In effect the Bureau applies the general provisions to intervene when conduct involving IP or IP rights creates, enhances or maintains market power as proscribed by the Act. Relevant general provisions include those relating to, but not limited to, criminal conspiracy (section 45), refusal to deal (section 75), abuse of dominant position (section 78 and 79), and resale price maintenance (section 76).

Under section 32 of the Act, the Bureau may recommend to the Attorney General of Canada to bring an application for a special remedy to the Federal Court for the unilateral exercise of IP right to exclude others, when the circumstances specified in section 32 are met (i.e. proof of undue limit or restraint of trade or lessened competition) and the alleged competitive harm stems directly from the exclusion and nothing else. The Bureau must also be of the view that no appropriate remedy is available under relevant IP statutes. The Bureau recognizes that it will only invoke the section 32 special remedies in very rare circumstances. The special remedies include: declaring any agreement, arrangement or licence void, restraining exercise of IP right, ordering grant of licence (except for trade-marks), expunging or amending a trade-mark, and directing that such other acts be done or omitted as the Federal Court may deem necessary.

The Draft Update and Public Consultation

The draft update does not alter the Bureau’s fundamental approach and views with respect to the interface between competition policy and IP right. The only substantive amendment to the IP Guidelines was aimed at addressing the amendments to the Act introduced in 2009 and 2010, such as decriminalization of criminal pricing and price maintenance conduct. Enforcement activities by the Bureau in the IP field have been relatively low and this update does not necessarily signal the Bureau’s commitment to dedicate more attention to this area. However, with signing of the MOU with CIPO, it remains to be seen whether the Bureau will play a greater role in IP right regulation and enforcement in Canada.

The Bureau invites interested parties to provide their comments on the draft update, and to inform the Bureau if there are other competition/IP issues that they believe the Bureau should address, no later than June 2, 2014.