The Competition Act’s (Act) expanded private litigation regime takes effect on June 20, 2025, (i) widening the range of conduct susceptible to private applications to the Competition Tribunal (Tribunal), (ii) lowering the threshold for obtaining leave to bring those applications, and (iii) allowing private applicants, for the first time, to obtain monetary compensation for civil conduct that contravenes the Act. Increased private litigation involving competition law claims is anticipated to be the result.
Background
The Act has long permitted private parties to seek damages in provincial superior courts and the Federal Court resulting from alleged criminal offences under the Act, such as price-fixing or bid-rigging, brought most often as class actions and to a lesser extent by competitors alleging criminal misleading advertising. These actions have not been affected by these recent amendments to the Act.
Prior to June 20, 2025, the private access regime already allowed private parties, with leave of the Tribunal, to bring applications in respect of refusal to deal, price maintenance, exclusive dealing, market restriction, tied selling and abuse of dominance, provided the applicant’s business is “directly and substantially affected” by the conduct (for price maintenance, the standard is only “directly affected”). Where the Tribunal rules in favour of a plaintiff, the remedies are limited to prohibition and remedial orders, with the exception of abuse of dominance, for which an administrative monetary penalty (AMP) payable (only) to the government is also available.
This private access regime for civil conduct contravening the Act is being expanded as of June 20, 2025.
What’s New
The changes to the Act’s private access regime coming into force on June 20, 2025, are significant.
More Conduct is Caught
Private access will be expanded to include any agreements that are likely to prevent or lessen competition substantially (section 90.1 of the Act), whether or not they involve a competitor, and civil misleading advertising (Part VII.1 of the Act) including drip pricing, greenwashing and other kinds of deceptive marketing practices.
Easier to Get Leave
To obtain leave, it will be sufficient for a private applicant’s business to be directly and substantially affected in “part” (rather than as a whole), except price maintenance for which a substantial impact is not required. Alternately, leave can be obtained if the Tribunal concludes that it is in the “public interest” to grant leave. Indeed, for misleading advertising cases, public interest will be the sole leave test.
Monetary Compensation
Successful private applicants for all non-misleading advertising cases will be able to receive monetary compensation in “an amount, not exceeding the value of the benefit derived from the conduct that is the subject of the order, to be distributed among the applicant and any other person affected by the conduct” — in addition to being able to seek behavioral remedies and, for certain conduct, AMPs. For misleading advertising cases, in addition to behavioural remedies and AMPs, private applicants who establish that the impugned representations were “false or misleading in a material respect” will be able to obtain “an amount, not exceeding the total of the amounts paid to the person for the products in respect of which the conduct was engaged in” for purchasers of the product.
Competition Bureau Overlay
If the Competition Bureau (Bureau) has launched an application regarding the same facts, private parties cannot commence a parallel private application. Similarly, if the Bureau has an open inquiry or discontinued such an inquiry due to a settlement in the same matter, private parties cannot proceed with their application.
Additionally, where a private applicant has been granted leave but the application is discontinued due to a settlement, the parties must provide a copy of the settlement agreement to the Bureau, which can seek to vary or rescind the settlement agreement. Litigants will therefore not only need to consider the competitive impact of any settlements, but also the possibility of settling before a leave decision is rendered to avoid this notification requirement.
Key Takeaways
- Compliance: It is a prudent time to review and update competition law compliance programs, particularly for the range of practices for which the private access regime is expanding. There have also been several other amendments to the Act in recent years that have substantively modified many provisions, and this expanded private enforcement adds another element of risk.
- Being Prepared: There is likely to be an uptick in competition law litigation, so businesses’ risk assessments should include potential private applications and their potential consequences. There may also be opportunities for businesses to bring cases as plaintiffs, rather than having to rely on complaints to the Bureau or other legal actions.
- Class-like Actions: While these amendments do not contain specific procedures for class actions, the introduction of monetary compensation to all persons affected by the impugned conduct creates an incentive for plaintiff counsel to attempt collective claims using the private access regime, thereby enhancing business risk for all conduct that potentially violates the Act.
If you have any questions, please do not hesitate to contact your usual Blakes contact or any member of the Blakes Competition, Antitrust & Foreign Investment group.
