| Issue | Considerations |
| What is a merger? | A merger is broadly defined. The Competition Act defines a merger to mean the acquisition, direct or indirect, whether by purchase or lease of shares or assets, by amalgamation or any other combination, of control over or significant interest in the whole or a part of a business of a competitor, supplier, customer or other person. |
| When do you need to have a merger approved? | Early in the transaction process: a proposed merger involving an operating business in Canada is subject to a pre-closing notification requirement to the Commissioner of Competition under the Competition Act where specified financial thresholds are exceeded. |
| What are the main financial thresholds? |
A two-part assessment: either assets in Canada or annual gross revenues from sales in, from or into Canada exceeding:
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| When would a merger be found to be anti competitive? | Does the merger result in a substantial lessening of competition (“SLC”)? The criteria under the Competition Act focus on whether a merger or proposed merger will prevent or lessen, or is likely to prevent or lessen, competition substantially. |
| What is the relevance of market shares? | Presumptive SLC for market share above 30%: amendments made to the Competition Act in 2024 implemented a “structural presumption”: a transaction that results in, or is likely to result in, an increased market share in excess of 30% or market concentration beyond prescribed quantitative thresholds is presumed to be anti-competitive, unless the merging parties can prove otherwise on a balance of probabilities. |
| If a transaction is not notifiable, is it still subject to Competition Act review? | All mergers are reviewable: even if a transaction does not meet the thresholds for pre-closing notification, the substantive merger review provisions of the Competition Act nevertheless confer authority on the Commissioner to determine whether the merger results in an SLC. A non notifiable merger may be reviewed by the Commissioner for up to three years after the transaction closes (versus one year if the parties notify). |
| Process for obtaining clearance | Pre-merger notification waiting period: the parties may close their transaction upon the expiration of a 30-day waiting period following pre merger notification (unless the waiting period has been terminated or waived). Parties typically seek clearance pursuant to a written request for an advance ruling certificate (“ARC”) or a no-action letter. |
| Timing of merger reviews | Complexity designation: non-complex mergers – maximum of 14 days; complex mergers – 45 days. If a supplementary information request is issued, the review period can be longer. |
| Filing fee | $90,198.19 (for mergers closing in 2026) |
| How is Competition Act risk handled in transaction documents? | Closing conditions and covenants: purchase agreements commonly require the parties to seek Competition Act clearance promptly after signing and co operate with each other throughout the clearance process. Closing is typically conditional on receiving an ARC or a no-action letter (or, in some cases, the expiry of the applicable waiting period, if applicable). |
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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