Posts Tagged ‘ trade associations

TRADE ASSOCIATION SURVIVAL IN A COMPETITIVE WORLD: CONSEQUENCES OF NON-COMPLIANCE AND WAYS TO MINIMIZE LEGAL SCRUTINY


INTRODUCTION

The Government of Canada has recently made some drastic amendments to the Competition Act (“the Act”) in efforts to further protect Canadians from the effects of anticompetitive market behaviour. Some of the key areas of the Act that have been overhauled include sections that relate to deceptive marketing practices, conspiracies, and the merger review process. The focus of this article will be centered on understanding why the current competition regime in Canada ought to be considered by trade associations and their members in their dealings to avoid potentially serious legal consequences.

Trade associations have been described as “individuals and corporations with common commercial interests who, under the auspices of the organization, join together to take joint actions that further their commercial or professional goals”. At first glance, this description may seem to lay the groundwork for completely legitimate activity such as discussing matters of industry importance, safety and quality standards and industry trends. In addition, because the Act lacks  provisions dealing exclusively with trade associations directly, one may think that activities involving trade associations are not on the Government’s radar. However, it must also be recognized that the risks associated with bringing market competitors together into such a tight forum creates a launching pad for trade association members to engage in anticompetitive conduct, which could very well be captured by the Act. However, this is not to downplay the legitimate roles trade associations have. As a result, the following will outline ways to maintain these legitimate purposes while being mindful of where to exercise caution.

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