In April, the Competition Bureau released for public comment1 a draft Corporate Compliance Programs Bulletin, which is intended to provide businesses with guidance on measures they should consider in order to prevent or minimize their risk of contravening the Competition Act (and selected other statutes) and detect contraventions, and to provide businesses with tools to help them develop their own compliance programs.2
When finalized, the draft bulletin will replace the existing bulletin, which was released in 1997. Some notable differences in the draft bulletin as compared to the existing bulletin are:
- the document has been substantially expanded;
- it covers other statutes under the Bureau’s jurisdiction, namely, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act;
- it elaborates on the importance of compliance;
- it includes recommendations for avoiding obstruction of justice charges;
- it includes a specific discussion respecting the need for compliance programs for trade associations;
- it elaborates on the consideration the Bureau will give to the existence of a corporate compliance program where there has been a contravention of the law; and
- it contains a compliance program “framework” document as well as a list of DOs and DON’Ts;
Importantly, the core elements of what constitutes the basic requirements for a credible and effective compliance program remain unchanged, namely: (i) senior management involvement and support; (ii) compliance policies and procedures; (iii) training and education; (iv) monitoring, auditing and reporting mechanisms; and (v) consistent disciplinary procedures.
While the draft bulletin is a welcome source of additional guidance for the business community and contributes to the transparency of the Bureau’s enforcement policy, some concerns were expressed by stakeholders during the public consultation process, including the following
- in some circumstances, the draft bulletin imposes baseline standards of compliance that lack sensitivity to the varying abilities of differently sized (e.g. smaller) firms to allocate resources to meet such standards of compliance (e.g. the auditing requirement);
- it is overly prescriptive, such that the Bureau or a court may conclude that a compliance program is deficient if it departs from the standards in the bulletin;
- its coverage of the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act creates, at times, coherency issues where elements of compliance under the Competition Act are intertwined with elements of compliance with these other Acts;
- it fails to adequately address the unique competition compliance challenges of trade associations, and offers limited guidance for businesses whose directors, officers or employees participate in a trade association;3
- whether the Bureau’s position that routine auditing to detect non-compliance is a realistic or efficient mechanism that should be deemed a minimum requirement for a credible and effective compliance program;
- the paucity of guidance on what constitutes the appropriate frequency and methods of monitoring compliance; and
- the Bureau’s position that, where senior management is involved in a breach of the Competition Act, it will deem the company’s compliance program as deficient and recommend to prosecutors that charges be laid against the company – this imputes liability to a company even where a manager has knowingly acted in contravention of his or her company’s compliance program.
The Bureau is currently considering the submissions made during the comment period. The final updated bulletin is expected to be released by late September 2008.