In recent years, competition/antitrust enforcers around the world, including Canada, have taken a marked interest in private equity deals. As part of a broader global trend of tougher merger enforcement, private equity firms that have taken ownership positions (controlling or minority) in portfolio companies that are competitors have been subject to heightened scrutiny. The litigation
Pre-merger exchanges of information can create competition risk. Companies considering mergers or acquisitions legitimately need access to detailed information about the other party’s business in order to negotiate the deal, engage in due diligence and implement the transaction. While non-competitively sensitive can (subject to any commercial concerns) be freely exchanged, care needs to be exercised
As mentioned in our prior blog post titled Commissioner Points to More Active Enforcement, Greater Transparency and Refined Approach to Efficiencies Defence, the Commissioner of Competition announced during his keynote speech at the Canadian Bar Association’s Competition Law Spring Conference on May 7, 2019 that the Competition Bureau intended to release for public comment
On June 17, 2019 the Competition Bureau announced that it is challenging Thoma Bravo’s acquisition of Aucerna, a company that offers valuation and reporting software to Canadian oil and gas producers.
The fact that the Competition Bureau is challenging the transaction after it has been completed suggests that the transaction was not subject to pre-merger
Over the past week, the Commissioner of Competition has made a number of comments relevant to big tech companies and the digital economy. These comments were made on a panel at the Data Forum Discussing Competition Policy in the Digital Era in Ottawa on May 30th, at a conference hosted by the Organisation
In a recent speech given at the Canadian Bar Association’s Competition Law Spring Conference, Commissioner of Competition, Matthew Boswell, announced the Bureau’s decision to place more focus on identifying non-notifiable mergers which could potentially raise competition law concerns.
While the Competition Act (“the Act”) requires pre-merger notification of certain proposed mergers when prescribed monetary thresholds
During his keynote speech at the Canadian Bar Association’s Competition Law Spring Conference on May 7, 2019, the Commissioner of Competition discussed several important topics, including more active enforcement, a refined approach to the efficiencies defence and greater transparency with merging parties. Each of these developments has significant implications for the merger review process, particularly
The South African Competition Commission has since the beginning of 2017 prohibited eleven intermediate mergers and has recommended that four large mergers be prohibited. This number is substantially higher than 2016, when the Commission prohibited three intermediate mergers and recommended that one large merger be prohibited. For the period end of September to October 2017, the Commission prohibited five mergers.
This note will briefly look at two important and interesting trends that followed from the prohibitions of proposed mergers in South Africa since the beginning of 2017.
The first trend in the prohibition of mergers is a move to look at the “coordinated effects” of a proposed merger (a change in the market structure which better facilitates tacit collusion). In this regard the Commission adopted a policy favouring less concentration in markets and looking at a history of collusion in the market.
Merger clearance in South Africa is not easy, nor quick. That may be a take-away from observing the recent clearance by the South African authorities of the DowDuPont global merger of equals covering markets for agricultural products, material sciences and chemicals as well as specialized health and electrical products. The merger was cleared some 15 months from the date of filing and then subject to detailed conditions.
We know that each merger will present its own features and issues. But, as in other multinational mergers considered by the competition authorities, certain points arise from the present merger to be considered by those who may be involved in similar transactions.
First, it is important to understand the counterfactual and theory of harm you are dealing with. The counterfactual, a term used to describe the likely position the relevant markets would be in absent the merger, is a necessary and legislatively mandated tool for merger evaluation. For the authority to determine whether the proposed merger will substantially lessen or prevent competition, it must understand fully what the market would look like without the merger. The Commission can then evaluate the merger based upon a theory of harm appropriate to the circumstances. This means they will assess what possible harm to competition will arise from the merger.
If the counterfactual is not clear, or is based upon speculation only, the theory of harm cannot be substantiated. Moreover, in that case, any remedies which are proposed – whether by the parties or the Commission – to address the theory of harm cannot be properly evaluated. This is far from an exact science, especially as one is seeking to predict future behaviour of the parties and others, in markets which are dynamic and environments which change.
On September 29, 2016, the Competition Bureau (the “Bureau”) released a revised consent agreement template for merger remedy negotiations. The release of the Bureau’s updated template is timely, as the number of consent agreements registered with the Competition Tribunal (the “Tribunal”) have risen significantly since the last template was published in 2007.
This year alone,
