Anti-trust enforcement will become a ‘hot button’ issue for regulators worldwide: competition lawyer

Davies’ Anita Banicevic is among the panellists at Canadian Lawyer webinar next week

Anti-trust enforcement will become a ‘hot button’ issue for regulators worldwide: competition lawyer
Anita Banicevic, partner, Davies Ward Phillips & Vineberg LLP

Discussion surrounding competition and anti-trust laws will only increase as the international debate over how much stronger enforcement rules are needed, says Anita Banicevic, a competition law partner at Davies Ward Phillips & Vineberg LLP.

“I think there is a lot of interest about the function and role of anti-trust laws,” says Banicevic, adding the question that needs to be answered is “do we have the right paradigms, tools and approach” to deal with the issues involved?

“It’s definitely becoming a hot-button topic,” says Banicevic, who points to the sheer number of mergers and acquisition transactions that have taken place globally recently, creating behemoths in many key sectors.

Banicevic is among several experts and lawyers, including Matthew Boswell, Commissioner of Competition, Competition Bureau Canada, who will participate in a Canadian Lawyer webinar on Wednesday, May 26, from 12 pm to 1 pm ET. The event will look at updates to competition laws and navigating a changing regulatory environment.

She points to the need for competition and anti-trust authorities worldwide to work together “on some sort of task force at an international level.” Such a body could consider “new theories” of competitive harm and “whether we need to think about the transactions occurring in different spaces differently and how we value them.”

Much of the interest in anti-trust issues stem from the meteoric rise of global “Big Tech” companies, especially the so-called FAANG players — Facebook, Apple, Amazon, Netflix and Google. These social media and tech companies have continued to grow their key business segments, which has not gone unnoticed by regulators, who raise questions about their business practices and market influence.

However, Banicevic says that it isn’t only about the FAANG companies. Technology is pervasive in many sectors, “so it’s not just the purely tech companies that are getting the spotlight,” she says. The anti-trust activities of companies in other sectors, such as the pharma sector, are also being investigated.

There’s also been a call for more transparency in elements related to how specific industries work, Banicevic says. For example, getting a better understanding of how algorithms work is something that the European Commission has been taking the lead on.

Banicevic says she thinks there is good reason to stay on top of work done by the bureau’s international counterparts, looking at issues of similar concern in Canada. However, rather than re-inventing the wheel by doing our own investigation, she says, it might be beneficial to be part of a more global approach to looking at enforcement, especially as many of the players, such as the FAANG companies, are headquartered are in other jurisdictions.

“To the extent that there may be Canada-specific concerns, you can understand why the bureau may wish to be involved,” she says. “But I also think it would be a responsible decision by the bureau to allow other enforcement agencies like the Federal Trade Commission or the European Commission to take the lead on some issues, which may benefit Canadians too.”

In Canada, Banicevic says our competition regulator has the power to order studies into competitive issues related to broad sectors, studies whose usefulness for being undertaken has been questioned given the Competition Bureau’s relatively limited resources. Often the bureau is asked by various parliamentary committees to participate in these studies, Banicevic says, “as there is real interest in using the tools of the bureau.”

However, she notes that the calls for these kinds of studies are often the result of “strategic complaints,” often from a competitor in the same industry, or are political in nature. “Some of them are not particularly meritorious,” she says.

“When you start from the proposition that the bureau has limited resources, and that at least some of these broader studies won’t have much merit to them, there are fewer resources left for real enforcement, the specific-case work that the bureau should be doing.”

Banicevic says that while it is essential to take on some advocacy in certain sectors, there is some concern that there could be a “politicization” of these broader market studies.

On the topic of resources available to the competition bureau, Banicevic says she is pleased the most recent federal budget has proposed increasing the amount of money available to the bureau. It pledged to increase the bureau’s budget by $96 million over the next five years, plus annual $27.5-million budget increases after that, as a way of enhancing its capacity and making sure “it is equipped with the necessary digital tools” for the modern economy.

How the additional $96 million will be spent and spread out over the five years has not been disclosed. But it would be a healthy boost to the bureau’s current budget of $53.7 million, which has not gone up much in past years, Banicevic says.

Increasing the bureau’s resources is a “tremendous boost,” she adds, giving the regulator more leeway to do what it needs to do.

Still, Banicevic says it is essential for the bureau to stay focussed on the competitive issues related to specific transactions or practices rather than broad market studies. And often, a more comprehensive picture in competitive matters can emerge from looking at specific cases, “so the priority should be on that.”

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