Proposal for a Council and Commission Decision concluding the Agreement between the European Communities and the Government of Canada regarding the application of their competition laws
Date: 1998-06-04
Institutions: European Commission
Subjects: Canada, competition law, control of restrictive practices, economic agreement, economic cooperation

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 04.06.1998 
COM(1998) 352 final 

98/0198 (CNS) 

Proposal for a 
COUNCIL AND COMMISSION  DECISION 
concluding the Agreement between the European Communities and the Government  of 
Canada regarding the application of their competition  laws 

(presented by the  Commission) 

EXPLANATORY  MEMORANDUM 

I. 

Introduction 

Globalization 

in  today's  rapidly  moving  economic  environment.  The 

The  background  against  which  competition  rules  must  be  applied  is  continuously 
changing 
impact  of  new 
technology  has  increased  the  globalization  of  many  sectors.  The  quickening  pace  of 
technological  advance,  the  opening  of  markets  and  the  rapid  development  of  global 
competition  in  a  large  number  of  sectors  are  a  challenge  to  competition  policy,  whether 
pursued  by  the  European  Commission  or  by  other  antitrust  law  enforcement  agencies 
elsewhere  in the  world. 

The  fact  that  today,  many  companies  are  operating  world-wide  or  are  concluding 
to 
strategic  alliances  with 
competition  authorities.  The  economic  effects  of  mergers,  restrictive  practices  or  abuses 
of  dominant  positions  are  often  felt  in  countries  other  than  those  in  which  the  firms 
concerned  are incorporated  or  based. 

international  partners  provides  additional  challenges 

Obstacles to enforcement  of competition  laws 

Although  International  Law  allows  the  Commission  a  certain  autonomy  to  apply  its 
competition  rules  to  foreign  firms,  practical  problems  are  often  encountered.  For 
example,  difficulties  can  arise  in  obtaining  information  and  evidence  located  outside  the 
European  Communities.  In  addition,  competition  rules  which  are  aimed  at 
the 
maintenance  of  effective  competition  on  the  home  market  may  be  less  effective  in 
dealing with anti-competitive  conduct  at the global  level. 

As more countries  adopt their own competition  rules, and as more  competition  authorities 
assert  jurisdiction  over  foreign  undertakings  because  of  harm  by  them  to  domestic 
markets, the possibilities  for  conflicting  or diverging  decisions  inevitably  increase. 

Co-operation 

Experience  has  shown  thai  the  most  effective  method  of  dealing  with  anticompetitive 
behaviour  affecting  more  than  one jurisdiction  is through  co-operation.  Where  competition 
authorities  are  aware  of  the  actions  of  their  counterparts  around  the  world  and  are  familiar 
with  the  reasoning  behind  their  actions  the  likelihood  of  conflicts  in  particular  cases  is 
reduced.  A  report  by  the  Group  of  Experts  on  Competition  Policy  in  the  New  Trade 
Order1  recommended  that  the  European  Union  extend  its  network  of bilateral  agreements 
on co-operation  in the  field  of competition  laws. 

To this end, on the basis of the mandate  granted  to the  Commission  by the  Council  on  the 
23rd  of January  1995 to negotiate  a bilateral  agreement  with the  Canadian  authorities,  the 
Commission  has  finalised  negotiations  with  Canada  on  a  Draft  Agreement  on  the 

Competition  Policy in the New Trade Order:  Strengthening  International  Cooperation  and Rules -
Report of the Group of Experts, July  1995. 

1 

application  of competition  rules. The Draft  Agreement  is very  similar to the  Agreement 
entered into with the Government of the United States in 19912. 

II. 

The Agreement  between the European Communities and the Government of 
Canada on the application of their Competition Laws 

The  Draft  Agreement  provides  for  the  notification  of  cases  under  investigation  which 
may  affect  the  important  interests  of  the  other  Party.  This  notification  procedure  will 
ensure  that  each  competition  authority  is  aware  of  the  activities  of  the  other  authority, 
allowing  cases  of  common  concern  to  be  easily  identified.  Once  a  case  has  been 
identified  as raising  significant  issues  for  both  sides, it will  be possible for the Parties to 
activate the co-operation or co-ord  ation provisions of the Agreement. 

The  Parties  may  agree  to  co-ordinate  their  enforcement  activities  and/or  provide  each 
other  with  assistance,  thus  increasing  die  likelihood  that  anticompetitive  behaviour  will 
be  brought  to  an  end  as  effectively  as  possible.  Co-ordination  by  the  competition 
authorities  may  also  be  beneficial  for  companies  as  it  will  reduce  the  likelihood  of 
conflicting  decisions  being made. Such co-ordination  and assistance  may only take place 
where it is consistent with the laws and important  interests of the Parlies. 

Like  the  1991  EC/US  Agreement  the  proposed  EC/Canada  Agreement  contains 
provisions  on both positive  and negative  or traditional  comity.  Positive  comity  provides 
that  one  Party  may  request  the  other  Party  to  take  enforcement  action.  Traditional  or 
negative  comity  provides  that  a  Party  will  consider  all  relevant  factors  where  its 
enforcement  activities  may  affect  the  important  interests  of  the  other  Party.  By  taking 
each  others  interests  into  account  in  the  enforcement  of  anticompetitive  laws  the 
likelihood of conflict  is reduced. 

Article Vll of the Draft  Agreement provides for the exchange of information  between the 
Parties.  This  clause  is quite  limited  as  Article  XI  of  the  Agreement  makes  it  clear  that 
existing  laws  remain  unaltered.  The  Parties  may  not  exchange  information  where  it  is 
contrary  to either existing  law or to their important  interests. At present  the  Commission 
is under a strict obligation  of confidentiality  with  regard  to information  which  it collects 
from  companies  in  the  application  of  competition  laws.  However  the  Agreement 
encourages  the  Parties to seek  the consent  of the companies  concerned  in order  to allow 
the Parties to exchange  information  normally  considered  confidential.  The confidentiality 
of information  exchanged  under the Agreement must be maintained  by the Parties. 

The  Annex  to  this  Explanatory  Memorandum  gives  a  detailed  description  of  the 
provisions of the Draft  Agreement. 

III.  Legal Basis 

In  so  far  as the  Draft  Agreement  relates  to  the  competition  rules  of  the  EC  Treaty,  the 
legal  basis for  the Council  to conclude the Agreement  is Articles  87 and 235 of the EC 
Treaty in conjunction  with the first subparagraph of Article 228 paragraph  3 thereof. The 

Agreement between the European  Communities and the Government of the United States of America 
regarding the application of their competition  laws, OJ L 95, 27.4.95, pp. 47 - 52 as corrected by OJ L 
131,  Î 5.6.95, pp. 38-39. 

1 

European  Parliament  must  be consulted  before  the Council  can conclude the  Agreement. 
To  the  extent  that  the  Agreement  applies  to  ECSC  products,  Articles  65  and  66  of  the 
ECSC Treaty form the legal basis for the Commission to conclude the Draft  Agreement. 

IV.  Conclusion 

The  Draft  Agreement  if entered  into  will  increase  the ability  of the Commission  and  the 
Canadian  competition  authority  to co-operate  with each other.  By providing a  framework 
for  co-operation  the  Draft  Agreement  should  increase  the  effectiveness  of  antitrust 
enforcement  and  reduce  the  number  of  cases  in  which  the  competition  authorities  make 
conflicting  or  incompatible  decisions.  The  Draft  Agreement  will  also  lead  to  a  much 
closer relationship  between  the Commission  and the Canadian  competition  authority  and 
to a greater understanding of each others competition  policy. 

The Commission  therefore  proposes  that the Council jointly  with  the  Commission  adopt 
a  decision  to  conclude  the  attached  Draft  Agreement.  To  this  end,  a  proposal  for  a 
Council  and  Commission  Decision  concluding  the  Agreement  between  the  European 
Communities  and  the  Government  of  Canada  regarding  the  application  of  their 
competition  laws is attached. 

ANNEX 

The  Agreement  between  the  European  Communities  and  the  Government  of 
Canada regarding the Application of their Competition  Laws 

Description of the  Agreement 

Objective 

The  main  objective  of  the  Draft  Agreement  is  to  establish  a  system  of  co 
operation  and  co-ordination  between  the  European  Commission  and  the  Canadian 
competition  authority  in  order  to  increase the  effectiveness  of  antitrust  enforcement  and 
reduce the likelihood of conflicting  c  overlapping decisions. 

Article I - Purpose and  definitions 

Article  1.1  indicates  the  purpose  of  the  Agreement,  which  is,  to  promote  co 
operation  and  co-ordination  and  prevent  conflicts  between  the  relevant  competition 
authorities. 

Article  1.2 defines  terms  used  in  the  Agreement.  As  far  as  the  Community  is 
concerned,  the  scope  of  the  agreement  covers,  Articles  85,  86  and  90  of  EC  Treaty, 
Regulation  No  4064/89  on  the  control  of  concentrations  between  undertakings,  Articles 
65 and 66 of the ECSC  Treaty  and the  implementing  regulations  adopted  on the basis of 
those  provisions. As  far  as Canada  is concerned,  the Agreement  covers  the  Competition 
Act  and  regulations  thereunder.  An  extension  of  the  definition  of  competition  laws  is 
laws  or  implementing 
provided  to  take  into  account  the  possibility  that  further 
regulations  may  be  adopted  in the  future.  The need  for  both parties to consent  in writing 
to  any extension  of the  definition  of  competition  laws  ensures  that  there  is no danger  of 
the definition  being extended beyond its intended scope. 

Article II - Notification 

Article II. 1  provides that the other competition  authority  is tc be notified  if any of 
its "important  interests" are affected.  Under Article  11.2 some  situations  are described  in 
which this test  is satisfied.  Article  II.3 defines  the point  at which  notification  is required. 
Paragraphs  4 through  7 of  this  Article  go  more  into  detail  on  when  notification  shall  be 
given.  The  general  approach  here  is  that  notification  is  to  take  place  at  a  stage  in  the 
proceedings  early  enough  to allow  account  still to  be taken  of the  other  Party's  opinion. 
Paragraph  7  requires  notification  whenever  its  competition  authority  participates  in  a 
regulatory  or judicial proceeding. Article II.8 states that notifications  shall be  sufficiently 
detailed  to  permit  an  initial  evaluation  by  the  notified  Party  of  the  effects  of  the 
enforcement  activity  on its interests. Article  II.9 is to be read in conjunction  with  Article 
IX, which will be discussed  below. 

Article III - Consultation 

Article  III provides  for  either  Party  to request  consultations. The  requested  Party 

will undertake to consult promptly. 

Article  IV  - Co-ordination  of enforcement  activities 

Article  IV  states  that  the  Parties  agree  to  assist  one  another  whenever  their  laws 
and  their  important  interests  allow.  Paragraph  2  deals  with  the  situation  where  the  Parties 
agree  that  it is in both  their  interest  to co-ordinate  their  enforcement  activities  with  regard 
to  related  situations.  This  refers  to  circumstances  in  which  anti-competitive  conduct  on 
the  market  of  one  Party  may  be  associated  with  identical  conduct  on  the  market  of  the 
other.  In  such  circumstances,  the  competition  authorities  of the  two  Parties  can  profitably 
co-ordinate  their  activities  and  provide  each  other  with  assistance,  always  to  the  extent 
compatible  with  their respective  laws and  important  interests. 

Paragraph  3 states  that  co-ordinated  enforcement  activity  is subject  to  compliance 
with  the  Parties'  own  laws  and  important  interests.  Such  co-ordination  may  result  in 
enforcement  action by  one  or both  Parties'  competition  authorities. 

According  to  paragraph  3 (c), either  of the  Parties  can  at  any time  notify  the  other 
of  its  intention  to  limit  or  terminate  the  co-ordination  and  pursue  its  enforcement 
activities  independently. 

Article  V - Co-operation  regarding  anti-competitive  activities  in the  territory  of  one  party 
that  adversely  affect  the  interests  of  the  other  party 

Article  V  is  also  known  as  the  "positive  comity"  clause,  which  allows  a  Party 
whose  interests  are adversely  affected  by  activities  within  the  other  Party's jurisdiction  to 
bring  the  matter  to  the  other  Party's  attention.  The  latter  Party  might  have  been  unaware 
of the  problem  or might  not  have  considered  it a priority.  Once  it  is aware  of the  situation 
and  of the  fact  that  it affects  the  important  interests  of the other  Party,  the requested  Party 
may,  at  its  own  discretion  and  having  due  regard  to  this problem,  undertake  enforcement 
of the rules. 

If  enforcement  activities  are  initiated,  the  requested  Party's  competition  authority 
shall  advise  the  requesting  Party  of  significant  developments  and  the  outcome  of  the 
activities,  see Article V  (3). 

Paragraph  4  provides  that  the  Requested  Party's  competition  authority  has  full 
discretion  in  its  decision  whether  or  not  to  undertake  enforcement  activities  with  respect 
to  the  anti-competitive  activities  identified  in  the  request  and  that  nothing  in  this  article 
can preclude  the Requesting  Party  from  undertaking  such enforcement  activities. 

Article  VI - Avoidance  of  conflict 

Article  VI  is  otherwise  known  as  the  "negative"  or  "traditional  comity"  clause. 
The  first  paragraph  provides  that  each  Party  shall  give  careful  consideration  to  the  other 
Party's  important  interests  throughout  all  phases  of competition  enforcement  activities. 

Article  VI.2  sets  out  several  factors  that  the  Parties  will  consider  whenever  their 

enforcement  activities  may  adversely  affect  the  important  interests of the other  Party. 

The  concept  of  "important  interests" must  be  understood  in  terms  of  the  purpose 
of the Agreement,  which  is the  establishment  of  effective  co-operation  in the  competition 
sphere.  The  interests  referred 
to  must  therefore  be  important  by  reference  to  that 
objective.  However,  paragraph  2  (iv)  also  mentions  the  possibility  of  conflict  with  the 
other  Party's  "articulated  economic  policies". This  is  intended  to  ensure  that  enforcement 

of  the  competition  rules, whether  territorial  or  extraterritorial,  does  not  run  counter  to  a 
clearly stated objective of the other Party. 

Article  VII- Exchange of information 

This  Article  does  not  change  the  rules  on  the  exchange  of  confidential 

information. 

Article  VII.  1 provides  that  the  Parties  agree  to  share  information  which  will 
facilitate  the  effective  application  of  their  respective  competition  laws  and  promote  a 
better understanding of each other's enforcement  policies and activities. 

Article  VII.2  states  that  one  Party  can  request  the  other  for  information  that  is 
relevant  to  an  enforcement  activity  that  is  being  contemplated  or  conducted  by  the 
requesting Party's competition  authority. 

Article  VII.3  provides  that,  in  case  of  concurrent  action  by  both  Parties' 
competition  authorities,  each  Party  shall  ascertain  whether  the  natural  or  legal  persons 
concerned  will  consent  to  the  sharing  of  confidential  information  between  the  Parties' 
competition authorities. 

Article  VII.4  points  out  that  during  consultations  pursuant  to  Article  III,  the 
Parties  will  provide  each  other  with  as  much  information  they  are  able  to,  in  order  to 
facilitate  the  broadest  possible  discussion  regarding  the  relevant  aspects  of  a  particular 
transaction. 

Article  VIII - Semi-annual meetings 

Article  VIII. 1  provides  for  semi-annual  meetings  between  the  competition 
authorities  to  discuss  matters  of  common  interest  in  co-operation  and  co-ordination  in 
relation to their enforcement  activities. 

Article  VIII.2  requires  a  report  on  these  semi-annual  meetings  to  be  made 
available  to  the  Joint  Co-operation  Committee  under  the  Framework  Agreement  for 
Commercial  and  Economic  Co-operation  between  the  European  Communities  and 
Canada. 

Article IX - Communications under this Agreement 

Article  IX  provides  that  communications  pursuant  to  the  Agreement  would 
normally  take  place  directly  between  the  competition  authorities,  by  direct  oral, 
telephonic  or  facsimile  communication  between  the  competition  authorities.  This 
informal  method of communication  should  facilitate  co-operation. Notifications,  requests 
for  consultation  and  "positive  comity"  requests  should  be  confirmed  in  writing  through 
diplomatic channels. 

Article X - Confidentiality and use of information 

Article X. 1 provides that neither Party  is required to communicate  information  to 
the  other  where  its  communication  is  prohibited  by  its  laws  or  incompatible  with  its 
interests. 

Article  X.2  states  that  information  communicated  in  confidence  between  the 
Parties  or  their  competition  authorities  must  be  protected  to  the  fullest  extent  possible. 
Any  application  by  a  third  party  for  disclosure  of  such  information  should  be  denied,  to 
the  fullest  extent  possible. 

Article  X.3  ensures  that  any  Member  State  whose  important  interests  are  affected 
are  kept  informed  of  all  notifications  received  under  the  Agreement.  The  competent 
authority  of  the  Member  State  will  also  be  informed  of  any  co-operation  and  co 
ordination  of  enforcement  activities.  In  this  regard,  a  request  from 
competition  authority  not  to disclose  confidential  information  should  be  respected. 

the  Canadian 

Article  X.4  states  that  the  Parties'  competition  authorities  shall  consult  one 
to  make 

another  before  taking  any  action  which  may  result  in  a  legal  obligation 
information  provided  under this Agreement  available to a third  party. 

Article  X.5  states that  information  received  by  a Party  under this Agreement,  shall 
only  be  used  for  the  purpose  of  enforcing  that  Party's  competition  laws.  The  information 
received  under  Article  II  (notification),  shall  only  be  used  for  the  purpose  of  this 
Agreement. 

Article  X.6  provides  that  a  Party  may  specify  the  terms  and  conditions  under 
which  the  information  furnished  shall  be  used.  The  receiving  Party  needs  the  other 
in  a  manner  contrary  to  such  terms  and 
Party's  consent  to  use  such  information 
conditions. 

Article  XI  - Existing 

laws 

Article  XI  provides  that  neither  Party  is  required  to  act  in  a manner  inconsistent 

with  its existing  laws, nor be required  to  amend  those  laws by the  Agreement. 

Article  XII  - Entry  into force  and 

termination 

Article  XII  states  that  the  Agreement  will  enter  into  force  upon  signature.  The 
Agreement  may  be  terminated  by  either  Party  upon  giving  60  days  notice  of  that 
intention.  The  Agreement  requires  a review  on  the  operation  of  the  Agreement  within  24 
months  from  the  date  of  its  entry  into  force,  which  enables  them  to  identify  additional 
areas  in  which  they  could  usefully  co-operate  and  identify  other  ways  to  improve  the 
Agreement.  This  review  includes  an  analysis  of  actual  or  potential  cases  in  order  to 
decide  whether  the Parties'  interests  could be better  served  through  closer  co-operation. 

Attached  to  the  Agreement  are three  letters  exchanged  between  the  Parties.  These 
letters  form  an  integral  part  of  this  Agreement.  In  a  draft  interpretative  letter  attached  to 
the  Agreement,  the  European  Community  and  the  European  Coal  and  Steel  Community 
set  out  two  interpretative  statements.  The  first  states  that  the  information  exchanged 
under  the  Agreement  may  not  include  information  that  is  covered  by  the  provisions  of 
Article  20  of  Council  Regulation  17/62  or  equivalent  provisions  in  other  regulations  in 
the  field  of  competition.  Such  information  may  only  be  communicated  to  the  Canadian 
competition  authority  with  the express  consent  of the source  concerned. 

The  second  states  that  each  Party  assures  the  confidentiality  of  all  information 
provided  in confidence  by  the other Party. The  receiving  Party  should  oppose  any  request 
for  disclosure  to  a  third  party,  unless  the  supplying  Party  has  given  its  authorisation  or 
when  it  is  required  by  the  lav/  of  the  receiving  Party.  A  Party  should  notify  the  other  if 

information  has  accidentally  been  used  or  disclosed  in  a  manner  contrary  to  the 
provisions of Article X. 

A letter by Canada confirms  that the above interpretative  letter is consistent  with 
their  understanding  of  the  Agreement.  Their  letter  goes  on  to  reiterate  that  existing  law 
remains  unchanged  and  illustrates  this  by  stating  that  Canada  can  not  exchange  any 
information  where  such  exchange  is  prohibited  by  existing  law.  Canada's  letter  is 
consequently confirmed  as raising no difficulties  by the European  Commission. 

Proposal for a Council and Commission  Decision 

concluding the Agreement between the European Communities and the Government of 
Canada regarding the application of their competition  laws 

THE COUNCIL OF THE EUROPEAN  UNION, 

THE COMMISSION  OF THE EUROPEAN  COMMUNITIES, 

Having regard to the Treaty establishing the European  Community, and in particular Articles 
87 and 235, in conjunction  with the first subparagraph of Article 228(3) thereof, 

Having  regard  to  the  Treaty  establishing  the  European  Coal  and  Steel  Community,  and  in 
particular Articles 65 and 66 thereof, 

Having regard to the proposal from  the Commission, 

Having regard to the opinion of the European  Parliament; 

Whereas  Article  235  of  the  Treaty  establishing  the  European  Community  must  be  invoked 
owing  to  the  inclusion  in  the  text  of  the  Agreement  of  mergers  and  acquisitions  which  are 
covered  by  Council  Regulation  (EEC) No  4064/89  of  21  December  1989  on  the  control  of 
concentrations between undertakings', which is essentially based on Article 235; 

Whereas,  given  the 
increasingly  pronounced 
problems, international co-operation in this field should be strengthened; 

international  dimension  to  competition 

Whereas, to this end, the  Commission  has negotiated  an Agreement with the Government  of 
Canada  on  the  application  of  the  competition  rules  of  the  European  Communities  and  of 
Canada; 

Whereas the Agreement, including the exchange of letters, should be approved. 

HAVE DECIDED AS FOLLOWS. 

Article I 

The  Agreement  between  the  European  Communities  and  the  Government  of  Canada 
regarding  the  application  of  their  competition  laws,  including  the  exchange  of  letters,  is 
hereby  approved  on  behalf  of  the  European  Community  and  the  European  Coal  and  Steel 
Community. 

The text  of the  Agreement  and  of the  exchange  of  letters, drawn  up  in the  Danish,  German, 
English,  Spanish, Finnish, French,  Greek,  Italian, Dutch,  Portuguese  and  Swedish  languages 
are attached to this Decision. 

OJ No L 395 of 30.12.1989, p.  I (corrected  version  : OJ No L 257, 21.9.1990, p. 13). 

Article 2 

The President  of the Council  is hereby  authorised  to designate  the person(s)  empowered 
to sign the Agreement on behalf of the European  Community; 

The  President  of  the  Commission  is  hereby  authorised  to  designate  the  person(s) 
empowered to sign the Agreement on behalf of the European Coal and Steel  Community. 

Done at Brussels, 

For the Council 
The President 

For the Commission 
The President 

lO 

DRAFT AGREEMENT  BETWEEN 
THE EUROPEAN  COMMUNITIES  AND 
THE GOVERNMENT  OF CANADA 
REGARDING THE APPLICATION  OF THEIR COMPETITION  LAWS 

The  European  Community  and  the  European  Coal  and  Steel  Community  ("the  European 
Communities")  of  the  one  part  and  the  Government  of  Canada  ("Canada")  of  the  other 
part ("the Parties") : 

Considering the close economic relations between  them; 

Recognizing  that  the  world's  economies,  including  those  of  the  Parties,  are  becoming 
increasingly  interrelated; 

Noting  that  the  Parties  share  the  view  that  the  sound  and  effective  enforcement  of 
competition  law  is  a  matter  of  importance  to  the  efficient  operation  of  their  respective 
markets and to trade between them; 

Acknowledging  their  commitment  to  enhancing  the  sound  and  effective  enforcement  of 
their  competition  laws  through  co-operation  and,  in  appropriate  cases,  co-ordination 
between them in the application of those laws; 

Noting  that  co-ordination  of  their  enforcement  activities  may,  in certain  cases, result  in  a 
more  effective  resolution  of  the  Parties'  respective  competition  concerns  than  would  be 
attained through independent enforcement  action by the Parties; 

Acknowledging  the  Parties'  commitment  to  giving  careful  consideration  to  each  other's 
important interests in the application of their competition  laws and to using their best  efforts 
to arrive at an accommodation  of those interests; 

Having regard to the Recommendation  of the Organization  for Economic Co-operation  and 
Development  Concerning  Co-operation  Between  Member  Countries  on  Restrictive 
Business Practices Affecting  International Trade, adopted on 27 and 28 July  1995; and 

Having  regard  to  the  Economic  Co-operation  Agreement  between  Canada  and  the 
European  Communities  adopted  on  6  July  1976,  to  the  Declaration  on  European 
Community  - Canada  Relations  adopted  on  22 November  1990  and  to the  Joint  Political 
Declaration  on  Canada-EU  Relations  and  its  accompanying  Action  Plan  adopted  on 
December  17. 1996; 

II 

Have agreed as follows : 

I. 

1. 

PURPOSE AND  DEFINITIONS 

The  purpose  of  this  Agreement  is  to  promote  co-operation  and  co-ordination 
between  the  competition  authorities  of  the  Parties  and  to  lessen  the  possibility  or 
impact  of  differences  between  the  Parties  in  the  application  of  their  competition 
laws. 

2. 

In this Agreement, 

"anti-competitive  activities"  shall  mean  any  conduct  or  transaction  that  may  be 
subject to penalties or other relief under the competition laws of a Party; 

"competent  authority  of  a  Member  State"  shall  mean  that  authority  of  a  Member 
State set out  in Schedule A.  Schedule  A may be added to or modified  at any time 
by the European Communities.  Canada will be notified  in writing of such additions 
or modifications before any information  is sent to a newly listed authority". 

"competition authority" and "competition authorities" shall mean: 

(i) 

(ii) 

for  Canada, the Director of Investigation  and Research  appointed  under the 
Competition Act, and 

the  European  Communities, 

for 
the  Commission  of  the  European 
Communities,  as to  its responsibilities  pursuant  to the competition  laws  of 
the European Communities; 

"competition  law or laws" shall mean: 

(i) 

for Canada, the Competition Act and regulations thereunder, and 

(ii) 

for  the  European  Communities,  Articles  85,  86,  and  89  of  the  Treaty 
establishing  the  European  Economic  Community,  Regulation  (EEC)  No 
4064/89 on the control  of concentrations between undertakings, Articles 65 
and 66 of the Treaty  establishing  the European  Coal  and  Steel  Community 
(ECSC), and  their  implementing  Regulations  pursuant  to  the  said  Treaties 
including High Authority Decision No 24-54, 

as well as any amendments thereto and such other laws or regulations as the parties 
may jointly  agree  in  writing  to  be  a  "competition  law"  for  the  purposes  of  this 
Agreement; and 

"enforcement  activity"  shall  mean  any  application  of  competition  law  by  way  of 
investigation or proceeding conducted by the competition authority of a Party. 

3. 

Any  reference  in  this  Agreement  to  a  specific  provision  in  either  Party's 
competition  law shall be interpreted  as referring  to that provision  as amended  from 
time to time and to any successor provisions. 

12 

II. 

1. 

2. 

3. 

4. 

NOTIFICATION 

Each  Party  shall  notify  the other Party  in the manner provided  by this  Article  and 
Article  IX  with  respect  to  its  enforcement  activities  that  may  affect  important 
interests of the other Party. 

Enforcement  activities that may affect  the important  interests of the other Party and 
therefore ordinarily give rise to notifiable circumstances include those that: 

(i) 

are relevant to enforcement  activities of the other Party; 

(ii) 

(iii) 

involve  anti-competitive  activities,  other  than  mergers  or  acquisitions, 
carried out wholly or in part in the territory of the other Party; 

involve conduct believed  to have been required, encouraged  or approved  by 
the other Party or one of its provinces or Member States; 

(iv) 

involve a merger or acquisition  in which : 

one or more of the parties to the transaction; or 

a company controlling one or more of the parties to the transaction; 

is a company incorporated  or organized  under the laws of the other Party or 
one of its provinces or Member States; 

(v) 

involve  the  imposition  of,  or  application  for,  remedies  by  a  competition 
authority that would require or prohibit conduct  in the territory of the other 
Party; or 

(vi) 

involve one of the Parties seeking information  located in the territory of the 
other Party. 

Notification  pursuant  to  this  Article  shall  ordinarily  be  given  as  soon  as  a 
competition  authority becomes aware that notifiable  circumstances  are present, and 
in any event, in accordance with paragraphs 4 through 7 of this Article. 

Where notifiable  circumstances  are present  with  respect  to mergers or acquisitions, 
notification  shall be given; 

(a) 

in the case of the European  Communities, when a notice is published  in the 
Official  Journal,  pursuant  to  Article  4(3) of  Council  Regulation  (EEC)  No 
4064/89, or when  notice  of  the  transaction  is received  under  Article  66  of 
the ECSC Treaty and a prior authorization  from  the Commission is required 
under that provision; and 

(b) 

in the case of Canada, not later than when its competition  authority  issues a 
written request for information  under oath or affirmation,  or obtains an order 
under section  11 of the Competition Act, with respect to the transaction. 

5. 

(a)  When  the  competition  authority  of  a  Party  requests  that  a  person  provide 
information,  documents or other records located  in the territory of the other 
Party,  or  requests  oral  testimony  in  a  proceeding  or  participation  in  a 

13 

personal  interview  by  a  person  located  in  the  territory  of  the  other  Party, 
notification  shall be given at or before the time that the request is made. 

(b) 

Notification  pursuant  to  subparagraph  (a)  of  this  paragraph  is  required 
notwithstanding  that  the  enforcement  activity  in  relation  to  which  the  said 
information  is  sought  has  previously  been  notified  pursuant  to  Article  II, 
paragraphs  1 to  3. However,  separate  notification  is  not  required  for  each 
subsequent request for information  from  the same person made in the course 
of such enforcement  activity unless the notified  Party indicates otherwise or 
unless the  Party  seeking  information  becomes  aware of new  issues  bearing 
upon the important interests of the notified  Party. 

6. 

WTiere  notifiable  circumstances  are  present,  notification  shall  also  be  given  far 
enough in advance of each of the following  events to enable the other Party's  views 
to be considered: 

(a) 

in the case of the European Communities, 

(i) 

(ii) 

when  its competition  authority  decides  to  initiate  proceedings  with 
respect  to  the  concentration,  pursuant  to  Article  6(1 )(c)  of  Council 
Regulation (EEC) No. 4064/89; 

in  cases  other  than  mergers  and  acquisitions,  the  issuance  of  a 
statement of objections; or 

(iii) 

the adoption of a decision or settlement, 

(b) 

in the case of Canada, 

(i) 
(ii) 

the filing of an application with the Competition Tribunal; 
the initiation of criminal proceedings; or 

(iii) 

the settlement of a matter by way of undertaking or consent order. 

7. 

(a) 

Each  Party  shall  also  notify  the  other  whenever  its  competition  authority 
intervenes or otherwise participates in a regulatory or judicial proceeding, if 
the issues addressed  in the intervention or participation may affect  the other 
Party's  important  interests.  Notification  under  this  paragraph  shall  apply 
only to: 

(i) 

(ii) 

regulatory or judicial proceedings that are public; and 

intervention  or  participation  that  is  public  and  pursuant  to  formal 
procedures. 

„ 

(b) 

Notification  shall be made at the time of the intervention  or participation  or 
as soon thereafter  as possible. 

8. 

Notifications  shall  be  sufficiently  detailed  to  enable  the  notified  Party  to  make  an 
initial  evaluation  of  the  effects  of  the  enforcement  activity  on  its  own  important 
interests.  Notifications  shall  include  the  names  and  addresses  of  the  natural  and 
legal persons involved, the nature of the activities under investigation  and the  legal 
provisions concerned. 

14 

Notifications  made  pursuant  to  this  Article  shall  be  communicated  in  accordance 
with Article IX. 

III. 

CONSULTATIONS 

1. 

2. 

Either  Party  may  request  consultations  regarding  any  matter  relating  to  this 
Agreement.  The request  for  consultations  shall  indicate the reasons  for  the request 
and  whether  any  procedural 
limits  or  other  constraints  require  that 
consultations  be  expedited.  Each  Party  undertakes  to  consult  promptly  when  so 
requested  with  the  view  to  reaching  a  conclusion  that  is  consistent  with  the 
principles set forth  in this Agreement. 

time 

During  consultations  under  paragraph  1,  the  competition  authority  of  each  Party 
shall  carefully  consider  the  representations  of  the  other  Party  in  light  of  the 
principles  set  out  in  this  Agreement  and  shall  be prepared  to  explain  to  the  other 
Party  the  specific  results  of  its  application  of  those  principles  to the  matter  under 
discussion. 

IV.  CO-ORDINATION  OF ENFORCEMENT  ACTIVITIES 

1. 

2. 

The  competition  authority  of  each  Party  shall  render  assistance  to the  competition 
authority  of  the  other  Party  in  its  enforcement  activities  to  the  extent  compatible 
with the assisting Party's laws and important interests. 

In  cases  where  both  Parties'  competition  authorities  have  an  interest  in  pursuing 
enforcement  activities with  regard  to related  situations, they may agree that it is in 
their  mutual  interest  to  co-ordinate  their  enforcement  activities.  In  considering 
whether particular enforcement  activities should be co-ordinated, either in whole or 
in  part,  each  Party's  competition  authority  shall  take  into  account  the  following 
factors, among others: 

(i) 

(ii) 

(iii) 

the  effect  of  such  co-ordination  on  the  ability  of  each  Party's  competition 
authority to achieve the objectives of its enforcement  activities; 

the  relative  ability  of  each  Party's  competition  authority  to  obtain 
information  necessary to conduct the enforcement  activities; 

the extent to which either Party's competition  authority can secure  effective 
preliminary  or  permanent  relief  against  the  anti-competitive  activities 
involved; 

(iv) 

the opportunity to make more efficient  use of resources; and 

(v) 

(a) 

3. 

the possible reduction of cost to persons subject to enforcement  activities. 

The  Parties  competition  authorities  may  co-ordinate  their  enforcement 
activities  by  agreeing  upon  the  timing  of  those  activities  in  a  particular 
matter,  while  respecting  fully  their  own  laws and  important  interests. Such 
co-ordination  may,  as agreed  by the  Parties'  competition  authorities,  result 
in enforcement  action  by one or both  Parties'  competition  authorities,  as is 
best suited to attain their objectives. 

15 

(b)  When  cajrying  out  co-ordinated  enforcement  activity,  each  Party's 
competition  authority  shall  seek  to  maximise  the  likelihood  that  the  other 
Party's enforcement  objectives will also be achieved. 

(c) 

Either Parjty may at any time notify  the other Party that it intends to limit or 
terminate 
its  enforcement  activities 
independently and subject to the other provisions of this Agreement. 

the  co-ordination  and  pursue 

V. 

1. 

2. 

3. 

4. 

CO-OPERATION  REGARDING  ANTI-COMPETITIVE  ACTIVITIES  IN 
THE TERRITORY  OF ONE  PARTY THAT ADVERSELY AFFECT THE 
INTERESTS  OF THE OTHER  PARTY 

The  Parties  note  that  anti-competitive  activities  may  occur  within  the  territory  of 
one  Party  that,  in  addition  to  violating  that  Party's  competition  laws,  adversely 
affect  important  interests of the other Party. The Parties agree that it is in both their 
interests to address anti-competitive activities of this nature. 

If  a  Party  has  reason  to  believe  that  anti-competitive  activities  carried  out  in  the 
territory of the other Party are adversely  affecting,  or may adversely  affect  the first 
Party's  important  interests,  the  first  Party  may  request  that  the  other  Party's 
competition  authority  initiate  appropriate  enforcement  activities. The  request  shall 
be as specific  as possible about the nature of the anti-competitive activities and their 
effects  on  the  interests  of  the  requesting  Party,  and  shall  include  an  offer  of  such 
further  information  and  other  co-operation  as  the  requesting  Party's  competition 
authority is able to provide. 

The  requested  Party  shall  consult  with  the  requesting  Party  and  the  requested 
Party's competition  authority shall accord  full  and sympathetic consideration  to the 
request in deciding whether or not to initiate, or expand, enforcement  activities with 
respect  to  the  anti-competitive  activities  identified  in  the  request.  The  requested 
Party's  competition  authority  shall  promptly  inform  the other Party  of  its  decision 
and  the  reasons  for  that  decision.  If  enforcement  activities  are  initiated,  the 
requested  Party's  competition  authority  shall  advise  the  requesting  Party  of 
significant  developments and the outcome of the enforcement  activities. 

Nothing  in  this  Article  limits  the  discretion  of  the  requested  Party's  competition 
authority  under  its competition  laws and enforcement  policies as to whether or not 
to  undertake  enforcement  activities  with  respect  to  the  anti-competitive  activities 
identified  in the  request,  or  precludes  the  requesting  Party's  competition  authority 
from  undertaking  enforcement  activities  with  respect  to  such  anti-competitive 
activities. 

VI.  AVOIDANCE  OF CONFLICT 

1. 

Within  the  framework  of  its  own  laws  and  to  the  extent  compatible  with  its 
important interests, each Party shall, having regard to the purpose of this Agreement 
as  set  out  in  Article  1,  give  careful  consideration  to  the  other  Party's  important 
interests  throughout  all  phases  of  competition  enforcement  activities,  including 
decisions regarding  the initiation  of an investigation  or proceeding, the scope of an 

16 

investigation  or  proceeding  and  the  nature  of  the  remedies  or  penalties  sought  in 
each case. 

Where  it  appears  that  one  Party's  enforcement  activities  may  adversely  affect  the 
important  interests  of  the  other  Party,  each  Party  shall,  consistent  with  the  general 
principles  set  out  above,  use 
to  arrive  at  an  appropriate 
its  best  efforts 
accommodation  of the Parties'  competing  interests  and  in  doing  so  each  Party  shall 
consider  all relevant  factors,  including: 

(i) 

(ii) 

(iii) 

(iv) 

(v) 

(vi) 

the  relative  significance 
to  the  anti-competitive  activities  involved  of 
conduct  occurring  within  one  Party's  territory  as  compared  to  conduct 
occurring within  that of the  other; 

the  relative  significance  and  foreseeability  of  the  effects  of  the  anti 
competitive  activities  on  one  Party's  important  interests  as  compared  to  the 
effects  on  the other  Party's  important  interests; 

the  presence  or  absence  of  a  purpose  on  the  part  of  those  engaged  in  the 
anti-competitive  activities  to  affect  consumers,  suppliers  or  competitors 
within  the enforcing  Party's  territory; 

the degree  of conflict  or consistency  between  the  enforcement  activities  and 
the  other  Party's  laws  or  articulated  economic  policies  including  those 
expressed 
in  the  application  of,  or  decisions  under,  their  respective 
competition  laws; 

whether  private  persons,  either  natural  or  legal,  will  be  placed  under 
conflicting  requirements by both  Parties; 

the  existence  or  absence  of  reasonable  expectations  that  would  be  furthered 
or defeated  by the enforcement  activities; 

(vii) 

the location  of relevant  assets; 

(viii) 

the  degree  to  which  a  remedy,  in  order  to  be  effective,  must  be  carried  out 
within  the other  Party's  territory; 

(ix) 

(x) 

the  need  to  minimize  the  negative  effects  on  the  other  Party's  important 
interests,  in  particular  when 
to  address  anti 
competitive  effects  within  the Party's  territory;  and 

implementing  remedies 

the  extent  to  which  enforcement  activities  of the  other  Party  with  respect  to 
the same  persons,  including judgements  or undertakings  resulting  from  such 
activities, would be  affected. 

VII.  EXCHANGE  OF  INFORMATION 

1. 

In  furtherance  of  the  principles  set  forth  in  this  Agreement,  the  Parties  agree  that  it 
is  in  their  common  interest  to  share  information  which  will  facilitate  the  effective 
application  of  their  respective  competition  laws  and  promote  better  understanding 
of each  other's  enforcement  policies and  activities. 

17 

2. 

3. 

4. 

Each  Party  agrees  to  provide  to  the  other  Party  upon  request  such  information 
within  its  possession  as  the  requesting  Party  may  describe  that  is  relevant  to  an 
enforcement  activity  that  is  being  contemplated  or  conducted  by  the  requesting 
Party's competition authority. 

In the case of concurrent action by the competition authorities of both Parties with a 
view  to the application  of their competition  law, the competition  authority  of  each 
Party  shall, upon  request by the competition  authority  of the other  Party,  ascertain 
whether  the  natural  or  legal  persons  concerned  will  consent  to  the  sharing  of 
confidential 
the  Parties'  competition 
authorities. 

thereto  between 

information 

related 

During consultations pursuant  »o Article III, each Party shall provide the other  with 
as  much  information  as  it  is  able  in  order  to  facilitate  the  broadest  possible 
discussion  regarding the relevais: aspects of a particular transaction. 

VIII.  SEMI-ANNUAL MEETINGS 

1. 

2. 

In furtherance  of their common interest in co-operation and co-ordination in relation 
to  their  enforcement  activities,  appropriate  officials  of  the  Parties'  competition 
authorities shall  meet twice a year, or otherwise as agreed between  the  competition 
authorities of the Parties, to: (a) exchange  information  on their current  enforcement 
activities and priorities, (b) exchange  information  on economic  sectors of common 
interest, (c) discuss policy changes which they are considering, and (d) discuss other 
matters of mutual interest relating to the application of competition laws. 

A  report  on  these  semi-annual  meetings  shall  be  made  available  to  the  Joint  Co 
operation  Committee  under  the  Framework  Agreement  for  Commercial  and 
Economic Co-operation between the European Communities and Canada. 

IX.  COMMUNICATIONS  UNDER THIS  AGREEMENT 

Communications  under  this  Agreement,  including  notifications  under  Article  II  and 
requests  under  Articles  III  and  V,  may  be  carried  out  by  direct  oral,  telephonic  or 
facsimile  communication between the competition  authorities of the Parties.  Notifications 
under  Article  II  and  requests  under  Articles  III  and  V,  however,  shall  be  confirmed 
promptly  in writing through normal diplomatic channels. 

X. 

1. 

2. 

CONFIDENTIALITY  AND USE OF INFORMATION 

Notwithstanding  any other provision of this Agreement, neither Party  is required  to 
disclose  information  to  the  other  Party  where  such  disclosure  is prohibited  by  the 
laws  of  the  Party  possessing  the  information  or  would  be  incompatible  with  that 
Party's important interests. 

Unless  otherwise  agreed  by  the  Parties,  each  Party  shall,  to  the  fullest  extent 
possible,  maintain  the  confidentiality  of  any  information  communicated  to  it  in 
confidence by the other Party under this Agreement.  Each Party shall oppose, to the 
fullest  extent  possible,  any  application  by  a  third  party  for  disclosure  of  such 
information. 

18 

3. 

(a) 

The  competition  authority  of the  European  Communities,  after  notice  to  the 
Canadian  competition  authority,  will  inform  the competent  authorities  of  the 
Member  State  or  Member  States  whose  important  interests  are  affected  of 
the notifications  sent to it by the Canadian  competition  authority. 

(b) 

the  Canadian  competition  authority,  will 

The  competition  authority  of  the  European  Communities,  after  consultation 
with 
the  competent 
authorities  of such  Member  State or  Member  States  of any co-operation  and 
co-ordination  of enforcement  activities.  However,  as  regards  such  activities, 
the  competition  authority  of  the  European  Communities  will  respect  the 
Canadian  competition  authority's  request  not  to  disclose  the  information 
which  it provides when  necessary  to ensure  confidentiality. 

inform 

4. 

5. 

6. 

Before  taking  any action which  may  result  in a legal  obligation  to make  available  to 
a  third  party  information  provided  in  confidence  under  this  Agreement,  the  Parties' 
competition  authorities  shall  consult  one  another  and  give due consideration  to  their 
respective  important  interests. 

information 
Information  received  by  a  Party  under  this  Agreement,  apart  from 
received  under Article II, shall only be used  for the purpose of enforcing  that  Party's 
competition  laws.  Information  received  under  Article  II  shall  only  be  used  for  the 
purpose  of this  Agreement. 

A  Party  may  require  that  information  furnished  pursuant  to  this  Agreement  be  used 
subject  to the terms  and  conditions  it may  specify.  The  receiving  Party  shall  not  use 
such  information  in  a  manner  contrary  to  such  terms  and  conditions  without  the 
prior consent  of the other  Party. 

XI. 

EXISTING  LAW 

Nothing  in  this  Agreement  shall  require  a  Party  to  take  any  action  that  is  inconsistent 
with  its  existing  laws,  or  require  any  change  in  the  laws  of  the  Parties  or  of  their 
respective  provinces  or Member  States. 

XII.  ENTRY  INTO  FORCE  AND  TERMINATION 

1. 

2. 

3. 

This Agreement  shall enter into force  upon  signature. 

This  Agreement  shall  remain  in  force  until  60  days  after  the  date  on  which  either 
Party  notifies  the other  Party  in writing that  it wishes  to terminate  the  Agreement. 

The  Parties  shall  review  the  operation  of  this  Agreement  not  more  than  24  months 
from  the  date  of  its  entry  into  force,  with  a  view  to  assessing  their  co-operative 
activities,  identifying  additional  areas  in  which  they  could  usefully  co-operate  and 
identifying  any  other  ways  in which  the  Agreement  could  be  improved.  The  Parties 
agree  that  this  review  will  include,  among  other  things,  an  analysis  of  actual  or 
potential  cases  to  determine  whether  their  interests  could  be  better  served  through 
closer  co-operation. 

Attached  to this Agreement  are three letters exchanged  between  the Parties. These  letters 
form  an integral part of this Agreement. 

IN  WITNESS  WHEREOF,  the  undersigned,  being  duly  authorized,  have  signed  this 
Agreement. 

, in 
DONE at 
the English, French, Danish, German, Greek, Spanish, Italian, Dutch, Portuguese,  Finnish 
and Swedish  languages, each text beiug equally authentic. 

, in duplicate, this 

day of 

For the European  Community and for the European Coal and Steel Community 

For the Government of Canada 

ÏÙ 

SCHEDULE A 

AUSTRIA 
Bundesministerium  fur  wirtschaftliche  Angelegenheiten 
Abteilung X/A'6  (Wettbewerbsangelegenheiten) 

BELGIUM 
Ministerie van Economische Zaken - Ministère des Affaires  Economiques 
Algemene Inspectie van de Prijzen  en de Mededinging - Inspection Générale des Prix et 
de la Concurrence 

DENMARK 
Konkurrenceradet 

FINLAND 
Office  of Free Competition 

FRANCE 
Ministère de l'Economie et des Finances 
Direction Générale de la Concurrence, de la Consommation  et des Fraudes 

GERMANY 
Bundeskartellamt 

GREECE 
Commission  de Concurrence 

IRELAND 
Competition  Authority 

ITALY 
Autorità Garante délia Concorrenza e del Mercato 

LUXEMBOURG 
Ministère de l'Economie 

NETHERLANDS 
Ministerie van Economische Zaken 

PORTUGAL 
Ministerio da Economia 
Direcçào Gérai do Comércio e Concorrência 

SPAIN 
Direccion  General Politica Economica y Defensa de la Competencia 

SWEDEN 
Konkurrensverket 

UNITED KINGDOM 
Office  of Fair Trading 

11 

Statement by the Commission 
(regarding the information  to be provided to the Member States) 

In  accordance  with  the principles  which  govern  the  relationship  between  the  Commission 
and  the  Member  States  in  the  application  of  the  Competition  rules  as  enshrined,  for 
example,  in  Council  Regulation  No.  17/62,  and  in  accordance  with  Article  X.3  of  the 
Agreement  between  the  European  Communities  and  Canada  regarding  the  application  of 
their competition laws, 

the  Commission  shall  forward  to  the  Member  State  or  Member  States  whose 
important interests are affected  the notification  sent by the Commission or received 
from  the Canadian  competition  authority.  Member  States  shall be  notified  as  soon 
as  is  reasonably  possible  and  in  the  language  of  the  exchange.  Where  the 
Commission  sends information  to the Canadian authorities, Member  States shall be 
informed  at the same time. 

the  Commission  shall  also  notify  the  Member  State  or  Member  States  whose 
important interests are affected  of any co-operation  or co-ordination  of  enforcement 
activities, as soon as is reasonably possible. 

For the purposes of this statement, it is considered  that the important  interests of a Member 
State are affected  where the enforcement  activities in question: 

(i) 

are relevant to enforcement  activities of the Member State; 

(ii) 

(iii) 

involve  anti-competitive  activities,  other  than  mergers  or  acquisitions, 
carried out wholly or in part in the territory of the Member State; 

involve conduct believed to have been required, encouraged  or approved by 
the Member State; 

(iv) 

involve a merger or acquisition  in which : 

one or more of the parties to the transaction; or 
a company controlling one or more of the parties to the transaction; 

is a company incorporated or organized under the laws of the Member State; 

(v) 

(vi) 

involve the imposition  of,  or application  for, remedies that would  require or 
prohibit conduct in the territory of the Member State; or 

involve  the  Canadian  competition  authority  seeking  information  located  in 
the territory of the Member Slate. 

In  addition,  at  least  twice  a  year  at  meetings  of  government  competition  specialists,  the 
Commission  will  inform  all  the  Member  States  about  the  implementation  of  the 
Agreement,  and particularly  about  the contacts  which  have taken  place with  the  Canadian 
competition  authority  as  regards  the  forwarding  to  the  Member  States  of  information 
received by the Commission under the Agreement. 

12 

Draft  letter to the Government  of Canada. 

Dear  [Name], 

On  [date],  the  Council  and  the  Commission  of  the  European  Communities  concluded  the 
Agreement  between  the  European  Communities  and  the  Government  of  Canada  regarding 
the application  of their  competition 

laws. 

In order  to ensure a clear  understanding  of the  European  Communities'  interpretation  of  the 
Agreement,  we set out below  two  interpretative  statements. 

1. 

2. 

In  the  light  of  Article  XI  of  the  Agreement,  Article  X(l)  should  be  understood  to 
mean  that  the  information  covered  by  the  provisions  of  Article  20  of  Council 
Regulation  17/62  or  by  equivalent  provisions  in  other  regulations  in  the  field  of 
competition  may  not  under  any  circumstances  be  communicated  to  the  Canadian 
competition  authority,  save with the express agreement  of the source  concerned. 

Similarly,  the  information  referred  to  in  Articles  11(8)  and  VII  of  the  Agreement 
may  not  include  information  covered  by  Article  20  of  Regulation  17/62  nor  by 
equivalent  provisions  in  other  regulations  in  the  field  of  competition,  save  with  the 
express agreement  of the source  concerned. 

in 
In  the  light  of  Article  X(2)  of  the  Agreement,  all  information  provided 
confidence  by  either  of  the  Parties  in  accordance  with  the  Agreement  will  be 
considered  as  confidential  by  the  receiving  Party  which  should  oppose  any  request 
for  disclosure  to  a  third  party  unless  such  disclosure  is  a)  authorised  by  the  Party 
supplying  the information  or b) required  under the law of the receiving  Party. 

This is understood  to mean  that 

each  Party  assures  the  confidentiality  of  all  information  provided 
in 
confidence  by  the  other  Party  in  accordance  with  the  receiving  Party's 
applicable  rules,  including  those  rules  intended  to  assure  the  confidentiality 
of information  gathered  during a Party's own enforcement  activities, 

each  Party  shall  use  all  the  legal  means  at  its  disposal  to  oppose  the 
disclosure of this  information. 

We  also  wish  to  confirm  that,  should  a  Party  become  aware  that,  notwithstanding  its  best 
efforts,  information  has  accidentally  been  used  or  disclosed  in  a  manner  contrary  to  the 
provisions  of Article  X, that  Party  shall  notify  the other  Party  forthwith. 

Would  you  kindly  confirm  by  return 
difficulties  with  the Canadian  Government. 

letter  whether  this  interpretation  raises  any 

Yours  sincerely, 

For the European  Community  and  for the European  Coal  and  Steel  Community 

13 

Draft  Reply from  the Government of Canada 

Legal Services, Industry  Canada 
Place du Portage, Phase 1 
50 Victoria  Street 
Hull, Quebec (Kl A 0C9) 

Telephone  : (819) 997 3325 
Facsimile: (819) 953 9267 

Date : 

Mr Karel Van Miert 
Member of the European  Commission 
200 rue de la Loi 
1049 Brussels 
Belgium 

Dear Commissioner Van Miert: 

Thank  you  for  your letter dated  ( 
). We  are very pleased  that  the Agreement  between 
the  European  Communities  and  the  Government  of  Canada  regarding  the  application  of 
our  respective  competition  laws  has  now  been  completed.  The  interpretative  and  other 
statements  included  in  your  letter  are  consistent  with  our  understanding  of  the 
Agreement. 

I  would  also  like  to  confirm  that,  with  respect  to  the  application  of  Article  XI,  and  for 
greater  certainty,  no  information  may  be  exchanged  by  Canada  pursuant  to  this 
agreement  which  could  not  have  been  exchanged  in  the  absence  of  this  agreement.  I 
would ask that you confirm  your understanding to this effect  by return letter. 

We  look  forward  to  continuing  and  furthering  our  relationship  of  competition  law  co 
operation as reflected  in the Agreement and in our mutual conduct to date. 

Sincerely 

Konrad von Finckenstein 
Director of Investigation and Research 

14 

Draft reply to Canada 

Dear [Name] 

Thank you very much for your letter dated [ 
letter does not give rise to any difficulties  for the European Communities. 

]. We confirm  that your 

We  are extremely  pleased  that the  Agreement  between  the  European Communities  and 
Canada has been completed and look forward to close co-operation in the future. 

Yours sincerely, 

For the European Community and for the European Coal and Steel Community 

15 

ISSN 0254-1475 

COM(98) 352 final 

DOCUMENTS 

EN 

08  11  06  01 

Catalogue number  : CB-CO-98-369-EN-C 

ISBN 92-78-37005-3 

Office for Official  Publications of the European Communities 

L-2985 Luxembourg 

2G