Supreme Court Of Canada Issues Landmark Merger And Efficiencies Decision

Yesterday, the Supreme Court of Canada released its long awaited decision in Tervita Corporation et al v. Commissioner of Competition.¹ In a 6-1 decision, the SCC allowed Tervita's appeal and set aside the divestiture order made by the Competition Tribunal and upheld by the Federal Court of Appeal (FCA). The SCC agreed with the FCA's conclusion that the merger would likely result in a substantial prevention of competition, but overruled the conclusions of the Tribunal and the FCA that the merger was not saved by the efficiencies defence.

This case stems from Tervita's acquisition of Complete Environmental Inc. which held a permit to develop a landfill for the disposal of hazardous waste in northeastern British Columbia. Tervita already owned and operated two hazardous waste landfills. Although the transaction was below the merger notification threshold, the Commissioner of Competition brought an application after the transaction had closed on the ground that