Written by Andrew D. Little
A unique and expansive privilege asserted for many years by the Commissioner of Competition has come back down to Earth with a bumpy landing.
The Federal Court of Appeal has held that the Commissioner can no longer claim a class-based public interest privilege over all the documents collected during a Competition Bureau investigation. And the Competition Tribunal’s hearing in Commissioner of Competition v. Vancouver Airport Authority, which was scheduled to start next week, has been adjourned to a future, undetermined date.
The Court of Appeal’s decision1 does not stop the Commissioner from claiming a document-by-document privilege over materials collected during an investigation. Nor does it affect other legal privileges or the confidentiality protections under the Competition Act and current Tribunal practices.
The decision may however have an impact on when parties, or their counsel and experts, will see copies of the documents in the Commissioner’s possession during a litigated case before the Tribunal. The Court emphasized the important procedural fairness protections available to parties sued by the Commissioner.
The Commissioner has announced that he will not seek leave to appeal to the Supreme Court of Canada. There is an opportunity now to make additional improvements to the pre-hearing process before the Competition Tribunal.
Confidentiality and Privilege During a Bureau Investigation
During investigations and formal “inquiries” under the Competition Act, Competition Bureau staff gather a lot of information from private parties, including documents and competitively sensitive information. Under the Act, inquiries must be conducted in private, and information provided to the Commissioner must be kept in confidence, subject to certain exceptions including for the “administration and enforcement” of the Act.2
In litigation before the Competition Tribunal, however, both the Commissioner and the responding party must provide copies of all relevant documents in their possession to the other side.
For over 20 years, the Commissioner has successfully claimed a blanket privilege over the entire class of documents collected during the investigation, other than the respondent’s own documents and information collected from public sources. In Tribunal litigation, the Commissioner’s initial documentary productions have often been modest; the responding party has received very few new documents informing it about the Commissioner’s case against it, before the party’s opportunity to question the Commissioner’s representative under oath at discovery.
Over the years the Tribunal established certain procedural mechanisms to balance the Commissioner’s broad public interest privilege against the respondent’s timely right to know the case against it. Those mechanisms included: (i) the Commissioner must provide a complete summary of the privileged information, before oral examinations for discovery; (ii) the respondent may challenge the sufficiency of that summary before a judicial member of the Tribunal; and (iii) the Commissioner must disclose all evidence to be used against the respondent by way of witness statements with the full evidence of each witness and all documents relevant to that testimony. The Competition Tribunal Rules require the Commissioner to provide those witness statements, and a complete list of all documents the Commissioner will rely upon, at least 60 days before the final Tribunal hearing. In addition, certain recent Tribunal’s decisions have required the Commissioner to provide some additional document disclosure before the hearing, including documents that are both helpful and unhelpful to the Commissioner’s position.
Impact of the FCA Decision
Applying recent Supreme Court authority, the Federal Court of Appeal held in Vancouver Airport Authority that there is no class privilege attaching to all the documents collected in a Bureau investigation. The Court sent the case back to the Tribunal to determine whether privilege, if claimed, would be proven by the Commissioner on the 1,200 documents at issue.
One immediate consequence of the appeal decision was an adjournment of the hearing into the abuse of dominance allegations against the Vancouver Airport Authority, which was scheduled to start in early February 2018. Below are some other observations and implications.
First, the existing statutory protections remain. The Commissioner still must conduct inquiries in private. The confidentiality required by section 29 of the Competition Act still applies.
Second, disclosure of competitively sensitive information can still be protected by Confidentiality Orders during litigated proceedings before the Tribunal. Those Orders have been granted in appropriate cases to ensure that the respondent’s confidential information is not released to its competitors or to the public.
Those Orders can also protect a competitor’s sensitive information from being released to the respondent. That is, under a Confidentiality Order, documents in the Bureau’s possession may be provided to the respondent’s counsel and experts only and not to the respondent itself (or sometimes only to certain designated persons such as internal counsel). In that way, the Tribunal can receive all relevant documents for its consideration in rendering a just ruling, while legal counsel and professional experts can protect the respondent’s interests by responding effectively to the Commissioner’s allegations and evidence, by cross-examining witnesses, and by making arguments to the Tribunal.
Third, the Federal Court of Appeal’s decision may affect the scope of the Commissioner’s assertion of public interest privilege. That is, without a privilege over the whole class of documents, the Commissioner may claim privilege over fewer documents and rely on the Confidentiality Order, perhaps on newly-amended terms.
Fourth, respondents may see more of the information collected during the Bureau’s investigation sooner—earlier in the litigation process and before oral examinations for discovery. With the elimination of the class privilege, the Commissioner must now prove privilege over each and every document, or at least over groups of similarly-situated documents. Doing so is more difficult than asserting a legal argument that all documents collected are privileged. In Vancouver Airport Authority itself, the Commissioner had waived privilege over more than 80 percent of the documents collected during the investigation. The decision not to claim privilege may now have to be made earlier in the process. Production of more documents, earlier in the discovery process, may in turn broaden the scope of questions at an examination for discovery of the Commissioner.
There will still be disagreements and motions over document production, particularly if the Commissioner decides to apply other recognized privileges, such as litigation privilege, to documents that previously attracted a claim of public interest privilege.
Lastly, both the Court of Appeal and the Tribunal issued written reasons that discuss administrative law principles of procedural fairness. They both should be required reading for counsel representing parties before the Tribunal and before the Bureau. The appeal reasons may have consequential effects, for instance on the Bureau’s document collection practices, and on the Commissioner’s filed materials on applications under section 11 of the Competition Act.
An Improved Process
The Federal Court of Appeal's decision means more up-front work for the Commissioner in deciding which documents to produce and which are arguably privileged, but less work due to shorter summaries of the remaining documents over which public interest privilege is still claimed. Responding parties may receive earlier (and maybe more) production of documents in the Bureau’s hands—all the better to prepare responsive evidence, expert reports and argument for the Tribunal hearing.
The result should be a slightly simpler, but fairer, process leading to a Tribunal hearing.
The Court of Appeal’s ruling also creates an opportunity to make additional improvements to the pre-hearing process in Tribunal proceedings. For example, in a practical sense the Commissioner often obtains significant early discovery of the respondent by obtaining Orders for the production of documents and answers to interrogatories under section 11 of the Competition Act. Current rules can cause duplicative, time-consuming work for both sides after the application is filed. In addition, oral discoveries of the Commissioner’s representative need to consistently provide more meaningful answers to proper questions.3 And everyone would benefit from much earlier deadlines for the delivery of witness statements and expert reports before a complex hearing, giving both sides more time to respond in substance and where appropriate, to mediate the dispute with the benefit of the full evidence.
These and other changes would advance the Tribunal’s mandate for both expeditious and fair hearings under subsection 9(2) of the Competition Tribunal Act.
1 2018 FCA 24 (24 January 2018), per Stratas JA (Boivin and Laskin JJA concurring).
2 Competition Act, subsection 10(3) and section 29.
3 See Commissioner of Competition v Vancouver Airport Authority, 2017 Competition Tribunal 16.