Introduction

The transportation industry is a major driver of the Canadian economy and has attracted significant attention from the Competition Bureau (Bureau) in Canada. This guide outlines key issues and trends to watch and best practices for navigating an increasingly complex and global industry.

Competition and Transportation Merger Control Regimes

All mergers in Canada are potentially subject to review by the Competition Bureau. However, transactions involving a transportation undertaking that meet the financial thresholds for notification under the Competition Act are also subject to a separate review under the Canada Transportation Act (CTA).

Competition Act Review

Where mergers exceed certain size thresholds, transacting parties are required to file a pre-merger notification under Part IX of the Competition Act. As of 2021, the pre-merger thresholds are:

  • Size of Transaction Threshold: The target must have at least C$93-million in assets in Canada or revenues in or from Canada.
  • Size of Parties Threshold: The parties, along with their respective affiliates, must have assets in Canada or revenues in, from or into Canada of at least C$400-million.

Part IX notifications require information regarding the transaction, the parties, their relevant affiliates, as well as top supplier and customer information and transaction planning documents. The Bureau's review can take as little as 14 days for non-complex transactions. For complex transactions, reviews are typically completed within 45 days, unless a supplemental information request (SIR) is issued that extends the timeframe for review until 30 days after the parties have complied with the SIR.

Canada Transportation Act Review

In addition to the Part IX notification obligation above, notifiable transactions involving federally regulated transportation undertakings are subject to a second review under the CTA. The CTA requires that the Minister of Transport be notified of every proposed transaction that is notifiable under Part IX of the Competition Act and involves a transportation undertaking.

The notice provided under the CTA includes all of the information required under the Competition Act notification and an assessment of the public interest impact of the proposed transaction as it relates to national transportation in Canada.

If the transaction involves an air transportation undertaking, the transaction must also be notified to the Canadian Transportation Agency. Unless the Minister of Transport decides within 42 days that the transaction does not raise public interest issues, the Canadian Transportation Agency must also determine that the transaction would result in an air transportation undertaking that is "Canadian" as defined under the statute, before the transaction may close. It is important to note that the CTA requirements that an air transportation undertaking must be "Canadian" apply to all transactions, whether or not notifiable under Part IX of the Competition Act.

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