Those convicted of violating the price fixing, big-rigging, and false or misleading advertising provisions of the Competition Act, R.S.C. 1985, c. C-34 now face mandatory prison sentences. On November 20, 2012, the final provisions of the Safe Streets and Communities Act, the omnibus crime bill formerly known as Bill C-10, came into force. Among other changes, those provisions now require mandatory prison sentences for convictions that previously may have resulted in conditional sentences or sentences served in the community.
Under the new sentencing provisions of the Safe Streets and Communities Act, S.C. 2012, c. 1 conditional sentences for convictions where the court imposes a sentence of less than two years are no longer available for indictable offences carrying maximum sentences of 14 years to life. As a result, convictions for indictable offences under the following sections of the Competition Act will result in mandatory prison sentences:
- Section 45 of the Competition Act, which states in part:
“(1) Every person commits an offence who, with a competitor of that person with respect to a product, conspires, agrees or arranges (a) to fix, maintain, increase or control the price for the supply of the product; (b) to allocate sales, territories, customers or markets for the production or supply of the product; or (c) to fix, maintain, control, prevent, lessen or eliminate the production or supply of the product. …”
- Section 47 of the Competition Act, which prohibits bid-rigging and provides that:
“(1) In this section, “bid-rigging” means (a) an agreement or arrangement between or among two or more persons whereby one or more of those persons agrees or undertakes not to submit a bid or tender in response to a call or request for bids or tenders, or agrees or undertakes to withdraw a bid or tender submitted in response to such a call or request, or (b) where the agreement or arrangement is not made known to the person calling for or requesting the bids or tenders at or before the time when any bid or tender is submitted or withdrawn, as the case may be, by any person who is a party to the agreement or arrangement.
- Section 52 of the Competition Act, which states in part:
“(1) No person shall, for the purpose of promoting, directly or indirectly, the supply or use of a product or for the purpose of promoting, directly or indirectly, any business interest, by any means whatever, knowingly or recklessly make a representation to the public that is false or misleading in a material respect.
In addition to the new sentencing provisions, the Safe Streets and Communities Act also will increase the length of time a person convicted of these offences will have to wait to apply for a pardon (now called a record suspension) from 5 years to 10.
These changes will impact cases that are decided by the court but also the terms of plea agreements. They also may impact the willingness of some to participate in the Competition Bureau’s Immunity and Leniency Programs (which require guilty pleas). The requirement of more severe sanctions and the loss of the court’s ability to exercise discretion in handing out conditional sentences could result in more of these cases going to trial. And for those engaged in conduct that could attract such penalties, it changes the risks considerably.