Federal Court

Commercial Law

Trade and commerce

Competition and combines legislation

Party not permitted to use court’s judicial review process to do “end run” around limited right of review of consent agreements

Jurisdiction. K Inc. was retailer of electronic books and had agreements with authors, publishers and distributors that granted it rights to sell e-books in Canada. Respondents were three of five major publishers of general interest fiction and non-fiction books. Commissioner of Competition entered into three consent agreements with respondents. Consent agreements addressed restrictions on price competition in sale of e-books that commissioner asserted resulted from change by respondents from wholesale distribution model to agency distribution model. To address those alleged anticompetitive effects of collective shift to agency agreements, consent agreements prohibited respondent publishers from directly or indirectly restricting, limiting or impeding e-book retailer’s ability to set, alter or reduce retail price of any e-book for sale to consumers in Canada. Consent agreements also prohibited respondents from entering into agreement with any e-book retailer that had one of those effects. K Inc. asserted that if consent agreements were implemented, it would suffer significant harm as its contractual relationships with respondents would be radically altered. K Inc. brought application for declaration that consent agreements were unlawful and for order to quash them. Application dismissed. It was not appropriate to exercise jurisdiction to hear application. K Inc. should not be permitted to use court’s judicial review process to do “end run” around limited right of review of consent agreements that Parliament created for tribunal on applications brought by third parties in subs.106(2) of Competition Act. Purposes and policy considerations underpinning consent agreement scheme that was now included in ss.105 and 106 of Act were to streamline settlement process and make it faster and more predictable. Issue of whether anticompetitive agreements entered into outside Canada were within purview of s.90.1 of Act was issue that raised question with respect to whether consent agreement was outside purview of tribunal and K Inc. failed to raise issue before tribunal. Other factors that weighed against hearing application were expertise of tribunal, nature of errors alleged to have been made and costs associated with permitting third parties to seek judicial review.

Rakuten Kobo Inc. v. Canada (Commissioner of Competition) (2018), 2018 CarswellNat 166, 2018 CarswellNat 167, 2018 FC 64, 2018 CF 64, Paul S. Crampton C.J. (F.C.).

cover image


Subscribers get early and easy access to Law Times.

Law Times Poll

Lawyers have expressed concerns that of 38 justices of the peace the province appointed this summer, only 12 have law degrees. Do you think this is an issue?