2. Regulatory Agencies Impacting Businesses

2.1 Competition Tribunal

Certain non-criminal conduct regulated by the Competition Act of Canada is reviewable by the Competition Tribunal. The members of the Tribunal include judges and persons with expertise in economics and business, and they are appointed by the Government of Canada to hear and decide applications under Parts VII.1 and VIII of the Competition Act.

Reviewable practices are not criminal and are not prohibited until made subject to an order of the Tribunal specific to the particular conduct and party. Matters reviewable by the Tribunal include refusal to deal, exclusive dealing, tied selling, market restriction, abuse of dominant position, price maintenance and certain other “anticompetitive” acts. The Tribunal can order a person to do or cease doing a particular act in the future if it finds, on the civil standard of the balance of probabilities, that a person has engaged in the reviewable activity. The Tribunal cannot impose a penalty for most reviewable practices; the Tribunal can impose administrative monetary penalties under the abuse of dominance and certain deceptive marketing practices provisions.

Breaches of certain provisions of the Competition Act and breaches of orders of the Competition Tribunal may constitute criminal offences. Criminal charges are prosecuted in the normal criminal courts and not before the Tribunal.

In most cases, complaints are brought to the Tribunal by the Commissioner of Competition who is appointed by the federal government to administer the Competition Act. However, private individuals and corporations do have the right to seek permission from the Tribunal to bring complaints directly to the Tribunal in relation to five limited areas – exclusive dealing, tied selling, refusal to deal, price maintenance and market restriction.

With respect to mergers, if the Commissioner concludes that a merger transaction is likely to prevent or lessen competition substantially, the Commissioner may challenge the transaction before the Tribunal. The Tribunal has broad authority to dissolve a completed merger, to order a purchaser to dispose of all or some assets or shares, or to order the parties not to proceed with all or part of a proposed merger if the Tribunal finds, on the balance of probabilities, that a merger or proposed merger prevents or lessens, or is likely to prevent or lessen, competition substantially in a relevant market and the efficiencies likely to result from the proposed transaction do not outweigh its likely anticompetitive effects.

2.2 Securities Commissions in Canada

The regulation of the capital markets is carried out largely within provincial jurisdiction. Accordingly, each province has established laws, regulations, rules and policies concerning the governance of the capital markets. Uniformly throughout Canada, each province has established a Securities Commission within the province to regulate and enforce securities laws. Happily, the various Securities Commissions have in large measure adopted similar or harmonious approaches to most aspects of the means by which the capital markets are governed.

Under its empowering legislation, each provincial Securities Commission is responsible for the administration of the respective provincial Securities Act and is obliged to perform all the duties assigned to the Commission pursuant to the respective Securities Act. These duties entail administrative functions, rule-making and policy-making functions and, significantly, investigation and enforcement functions.

The investigation and enforcement provisions are substantially similar across the provincial Securities Commissions.

• For the due administration of securities laws or the regulation of the capital markets in each province.



• To assist in the due administration of the securities laws or the regulation of the capital markets in other jurisdictions.

The investigation authority allows persons appointed by the Commission to investigate or inquire into the affairs of any person or company including the right to examine persons, documents or things in respect of which the investigation is ordered. The power of the person making the investigation is extensive and includes the power to summon and enforce the attendance of any person and the authority to compel that person to testify on oath or otherwise. Based upon the results of an investigation, the Securities Commissions are given the concomitant authority to conduct administrative or regulatory hearings before a quasi-judicial tribunal composed of appointed commissioners.

1. General offences, such as making an untrue statement to the Commission.



2. Offences by directors and/or officers, such as acquiescing in the commission of a general offence.



3. Insider trading and/or tipping offences. Anyone who commits an offence of this type is liable to a maximum fine of C$5-million and/or a maximum prison term of five years.

In British Columbia, charges may be laid by the provincial government under the Offence Act and heard in a provincial court.

While the subject matter of any Securities Commission investigation or hearing can be quite diverse, the subject matter of hearings or prosecutions tends to emphasize the Securities Commission’s principal purposes of enforcing requirements for timely, accurate and sufficient disclosure of information to the capital markets by capital markets participants. It also includes investigation and enforcement proceedings for the purposes of restricting or discouraging fraudulent and unfair market practices and procedures and, also, for the purposes of maintaining high standards of fitness and business conduct to ensure honest and responsible conduct by market participants. Accordingly, a Securities Commission may conduct hearings into issues such as market manipulation, continuous and accurate disclosure obligations and insider trading violations.

Decisions made by a Securities Commission are subject to appeal. Appeals may be taken to the courts, which will act in a supervisory capacity over the decisions of the commissions. Historically, judicial intervention over the decisions of the Securities Commissions has been restrained.

2.3 Environmental Protection Agencies

A myriad of environmental protection laws and regulations exist at both the federal and provincial levels of government in Canada. These regulations control the discharge of air and water contaminants, the management and disposal of wastes, the exploitation of such natural resources as our forests and minerals, and the importation, manufacture and use of toxic substances such as pesticides. Many activities that fall within the scope of these regulations require government licences, permits or approvals of one sort or another. Furthermore, government agencies or departments charged with the administration of Canada’s environmental protection laws and regulations are empowered to investigate and prosecute breaches of the law and to issue a variety of orders and other directives that require legal compliance or often expensive environmental remedial action.

With respect to enforcement activities, the most common tool available to environmental agencies is the prosecution of an offence before the lower courts, which deal with regulatory non-criminal offences. While some provincial and federal agencies have recently been granted the authority to issue administrative penalties that do not involve judicial processes, this enforcement tool is used less often as the available penalties are relatively minor. Those individuals and corporations prosecuted before the courts are subject to maximum fines that in the case of corporations, can run in the millions of dollars. Individuals, including officers and directors, may be imprisoned, typically, for one to five years.

It is not necessary for the prosecuting agency to establish that the accused intended to violate the environmental law in question, as is the case with true criminal offences. However, an accused person is entitled to be acquitted of a regulatory charge if the accused can demonstrate that the offending activity or event resulted, notwithstanding that the person was acting diligently to comply with the relevant law. This is the defence of “due diligence” that is an important part of Canadian regulatory or “quasi-criminal” law and has contributed to the need of those involved in activities that can adversely affect the environment to develop environmental management and compliance systems.

As a consequence of the discretionary powers granted government agencies to regulate activities by way of orders, directives and permits, environmental protection laws typically include rights of appeal to an independent or quasi-independent tribunal. In addition, environmental protection or assessment laws also include public hearing requirements for significant activities such as large or hazardous waste disposal facilities and large-scale industrial or natural resource projects, to ensure that both the environmental merits of the project and the concerns of the public are addressed before the project is commenced.

Environmental appeals or hearings can arise when agencies impose onerous terms and conditions in air, sewage or waste management and disposal permits, or when they simply refuse to issue such a permit. Appeals are also typically available when an environmental agency issues an administrative penalty or an order that requires a person to take investigatory or remedial action. In some cases, these statutory appeals lead to the courts or to the executive level of government, typically a Minister of the Environment or even the full government Cabinet.

The procedures utilized by the various environmental protection tribunals vary, in keeping with the general principle of administrative law that a tribunal not be bound by precedent and that it develop its own particular expertise in dealing with the issues that come before it. Accordingly, strict judge-made rules of evidence rarely apply and great efforts are generally taken to accommodate the ordinary citizen in participating in the hearing process. This is particularly the case with respect to environmental protection tribunals, as public participation has always been seen as an important part of environmental protection.

For example, environmental impact assessment, which is typically triggered when a major industrial project, such as a hydroelectric dam or a mine requires a government permit, often generates widespread local and regional public concerns as to the likely or potential impact of the project upon the natural and social environment. The intent of the process is not only to require the proponent to demonstrate that it has assessed all the potential environmental impacts and taken steps to mitigate them, but also to demonstrate that the public has been consulted with and given an opportunity to voice their concerns and have them addressed. If the initial public consultation process is unsuccessful in managing such public concerns, then a public hearing may be required to provide a more comprehensive public airing. Often the process is political in nature, as some tribunals merely have the power to report on their hearing to a senior government official and make recommendations.

Historically, administrative hearings with respect to appeals from environmental licensing and permit decisions or environmental remediation orders have been less contentious. More recently, however, Canadian environmental agencies have become more aggressive in these areas. As a result, in many parts of the country, there has been a proliferation of appeals to environmental tribunals questioning the wisdom of environmental authorities in exercising their powers. Attempts to address historical soil and groundwater contamination have been particularly contentious, resulting in protracted appeals to environmental protection tribunals and, ultimately, the courts. In many cases, past owners or occupiers have been named in environmental orders, whether or not there is any evidence that they failed to follow the laws that existed at the time or had any involvement in causing the subject pollution or contamination.

2.4 Energy Boards and Commissions

There are several statutes at both the federal and provincial level that govern Canada’s energy sector. In many cases, these statutes provide for ongoing regulation by federal or provincial agencies and tribunals.

• The construction and operation of interprovincial and international pipelines that transport commodities including, but not limited to, oil and natural gas.



• Pipeline traffic, tolls and tariffs.



• The construction and operation of international and designated interprovincial power lines.



• The export and import of natural gas, oil and electricity.

Power lines and pipelines that are completely within the borders of one province are usually regulated by that province’s regulatory agency. Energy boards, whether they are federal or provincial, typically review, among other things, the economic and technical feasibility, and the environmental and socio-economic impact of the proposed projects.

In addition, utility companies that supply electricity and natural gas services within a province are usually regulated by that province’s regulatory agency, such as the Alberta Utilities Commission, the British Columbia Utilities Commission, the Ontario Energy Board and Quebec’s Régie de l’énergie. The mandate of the various agencies vary from province to province, depending upon how electricity and natural gas utility services are regulated in that province. In general, the boards are responsible for approving or deciding complaints regarding the distribution and transmission rates that are charged by the various utility companies that they regulate. They may also regulate the marketers of the gas and electricity commodities, although they typically do not fix the prices of the commodities being sold.

2.5 Canadian International Trade Tribunal

The Canadian International Trade Tribunal (CITT) is the federal administrative tribunal responsible for enforcing Canada’s international trade agreements (the North America Free Trade Agreement (NAFTA) and the World Trade Organization Agreement on Government Procurement – (the AGP)) and Canada’s domestic Agreement on Internal Trade (AIT).

The CITT is a quasi-judicial body that carries out statutory responsibilities independently of government. The CITT has rules and procedures similar to those of a court of law, but they are not quite as strict or formal, and the proceedings are typically much shorter in length.

2.5.1 Bid Protest Tribunal for Procurement Matters

The CITT acts as the “bid protest” tribunal for federal government procurement matters, where a bidder considers the procurement or the treatment of its bid to have been unfair. Complaints made to the CITT must be made within 10 business days from the date on which the complainant becomes aware of the flaw in the procurement process. The CITT almost invariably proceeds by way of written submissions from the complainant and the government. It issues its ruling very promptly, typically within three months.

If the complaint is upheld, the CITT can make one of several orders, including (a) an order that a new procurement take place, (b) an order that the contract be awarded to the complainant, and (c) an order awarding damages based on the complainant’s lost profit.

The CITT is an “expert” tribunal, in that its members have considerable knowledge of, and experience with, federal government procurement policy and law. Accordingly, the decisions of the CITT are given considerable weight by the Federal Court of Appeal (the court responsible for reviewing the CITT’s decisions), and are not easily overturned by the court.

The CITT does not necessarily oust the Federal Court’s jurisdiction to hear a procurement dispute between the bidder and the federal government. However, if the dispute is simply or primarily that the procurement violated a trade agreement, the Federal Court could refuse to hear the dispute on the grounds that the dispute should have been pursued by way of a complaint to the CITT – the expert tribunal for the enforcement of the trade agreements.

2.5.2 Dumping and Subsidizing

International trade agreements and Canadian legislation allow the Canada Border Services Agency (CBSA) to impose duties on imported goods when Canadian producers are adversely affected by unfair international competition.

These measures apply where the imported goods:

• Are sold at a price lower than in the home market or lower than the cost of production (dumping).


• Receive benefits from certain types of government grants or other assistance (subsidizing).

The determination of dumping and subsidizing is the responsibility of the CBSA. The CBSA makes both a preliminary and then a final determination of dumping and/or subsidization. The CITT’s role in the process is the determination of whether such dumping or subsidizing has caused material injury or retardation or is threatening to cause material injury to a domestic industry. The CITT holds a preliminary injury inquiry exclusively by written submissions to determine whether the complaint filed with the CBSA discloses a reasonable indication of injury.  If the CITT makes a negative determination on this point, then the entire investigation is terminated. If the CITT makes a positive determination at the preliminary injury inquiry, then the CBSA proceeds to its own preliminary determination and, at that point, the CITT initiates a formal injury inquiry. If the CITT makes a finding of material injury, the CBSA continues to impose antidumping or countervailing duties on the dumped or subsidized imports.

2.5.3 Appeals and Other Matters

In addition to the foregoing, the CITT’s mandate includes hearing appeals of federal sales tax and customs duties assessments, safeguard inquiries, references on economic and trade issues, and a mandate involving tariffs on textiles.

2.6 Labour Relations Boards

The labour relations statutes of every province and the Canada Labour Code each provide for the establishment of a labour relations board. Labour relations boards are expert administrative tribunals charged with the administration and enforcement of a labour relations statute. They perform both administrative and adjudicative functions.

Most labour relations boards are comprised of impartial labour relations experts and of representatives of labour and management. For example, the Ontario and British Columbia Labour Relations Boards are comprised of a chair, an alternate chair and full-time and part-time vice-chairs, as well as a number of board members, who represent in equal numbers the interests of employers and employees. In their adjudicative roles, each of these boards sit as either a three-person panel (comprised of the chair, the alternate chair or a vice-chair and two members, one from each of the employer and employee constituencies) or as the chair, the alternate chair or a vice-chair sitting alone.

• The certification and decertification of trade unions as employee bargaining agents.


• The processing and resolution, by settlement or adjudication, of unfair labour practice complaints, including employees’ duty of fair representation complaints against their unions.


• The issuing of declarations and directions with respect to unlawful strikes and lock-outs and, in some circumstances, unlawful picketing.


• Successor and related employer declarations in the event of a sale of business or other corporate transaction.


• In some jurisdictions and circumstances, the arbitration of grievances arising under collective agreements.


• Direction with respect to inter-union disputes over the assignment of work.

Labour relations statutes may also charge labour relations boards with additional responsibilities, such as inquiring into complaints that an employee has been disciplined for exercising rights under occupational health and safety legislation, directing the settlement of a first collective agreement through arbitration, or enforcing public sector employment legislation.

Labour relations boards provide field or administrative services that are designed to facilitate the settlement of disputes and to allow employers, trade unions, and employees to tailor solutions to their needs. Most labour relations boards have officers whose responsibility is to attempt to mediate and resolve disputes after an application to the board has been filed, and to conduct and assist with board-supervised votes, such as certification votes or final offer votes.

If a matter cannot be resolved informally through a board’s field services department, the board will conduct a formal hearing into an application and issue a written decision. Labour relations boards hold full adjudicative hearings in which the parties are required to call evidence and make legal arguments. The boards, with the exception of the labour commissioners in Quebec (where appeals are made to the Quebec Labour Court), have broad powers to review and reconsider their decisions. Labour relations board orders are made enforceable by the exercise of powers of the judiciary or by board prosecutions.

Decisions of labour relations boards are protected from court intervention by privative clauses in the labour relations statutes, which typically provide that the decisions of a board are final and binding on the parties. A party to a labour relations board proceeding may, however, still seek to overturn a board decision by applying to the courts for judicial review.

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