What you need to know as a Condominium Corporation, Director, or Manager
We at Fine and Deo are carefully reviewing and providing advice in respect of a recent Order For The Written Return of Information and Production of Records made pursuant to the Competition Act on behalf of our condominium clients. Our team includes experienced counsel that has previously acted as counsel to the Competition Bureau and who is very familiar with its procedures and nuances. This will further ensure the best possible advice to our clients.
The Competition Bureau of Canada has served a large number of Ontario condominium corporations with this Order, relating to renovation contracts, some as early as 2007. The condominium corporations in question are not the subject of this investigation, but are believed to be possible victims of unfair competition.
The particular department of the Competition Bureau of Canada that has issued the subject Orders to condominium corporations is the Cartels and Deceptive Marketing Practices Branch.
The Branch is investigating rigging and collusion amongst renovation contractors and their suppliers which, together are referred to as "Cartels":
The Bureau is an independent law enforcement agency whose mandate is to ensure that there are no unfair practices used by commercial entities or individuals competing for business. The Bureau pursues criminal convictions against individuals and entities that breach the Competition Act or its investigative orders (by impeding or preventing any enquiries or examination under the Competition Act). It is not only important to provide the information requested by any Order of the Competition Bureau within the 90 day period, or such other period as may be provided in the Order, but one must be very careful to provide all of the information that is subject to the Order. To not do so may attract prosecution.
The information and records obtained by the Order may be used to initiate either a criminal or civil proceeding. However, no information or records provided by the condominium corporation can be used against the corporation in any criminal proceeding. All information and records provided to the Bureau are kept confidential pursuant to section 29 of the Competition Act unless a proceeding is initiated. If a proceeding is initiated, the person who swears the affidavit may be called as a witness in court and a further witness statement will need to be prepared. It is important that a director of the corporation signs the affidavit as that person represents the condominium corporation and may be required to appear in court.
Condominium corporations do not appear to be in the crosshairs, however, it is important to deal with the matter so that the request for disclosure is available in accordance with the Order of the Bureau. Nothing guarantees that the investigations will not expand if the Bureau ultimately discovers that there was suspected other unlawful conduct in respect of these or other renovation projects.
If information or records indicate that a board member has been involved in bid-rigging, and this information can be obtained from third parties, it is imperative to seek immunity or leniency from the Bureau by contacting the Senior Deputy Commissioner. Thereafter, the person who receives such a marker, must agree to provide information to the Bureau. This is a delicate process and must be handled through counsel. However, it is highly unlikely that condominium corporations were involved in bid-rigging.
We are here to provide legal services to our condominium clients throughout this process as well as during any subsequent legal action that may be initiated as a result of the investigation. Within 90 days, as indicated in the Order, it is imperative that information and records be collated so that we can help prepare the required affidavit for submission. All records and information dealing with issues contained in the Order, whether paper or electronic, whether in corporate e-mail accounts or in private e-mail accounts, must be preserved.
We will keep updating you with new information as necessary.