Federal Court refuses to intervene in Commissioner's decision to close case: Confirms Commissioner's independence

July 1, 2006

The Federal Court of Canada has dismissed an application for judicial review of the Commissioner of Competition's decision to discontinue an inquiry into the distribution of motion pictures in Canada. The main issue was whether the Bureau was obliged to provide the complainants with a copy of an external economist's report, which had played a role in the Commissioner's decision to discontinue the inquiry. The complainant claimed that the Bureau's refusal to provide a copy of the report was a breach of its duty to act fairly, and also prevented the applicant from filing a reply to the report, in violation of its right to hear and respond to the case against it.

The Federal Court considered whether the Commissioner's decision to discontinue an inquiry is judicial or quasi-judicial in nature, or purely "administrative" (and thus less amenable to court interference). Based on the facts that the Competition Act does not provide for a hearing, the decision does not affect complainant rights or obligations, and the proceeding is not an adversarial one, the court concluded that the Commissioner's decision is an administrative act. The court referred to the Supreme Court's decision in Baker v. Canada (MCI) [1999] 2 S.C.R. 817 for the guidelines for analysing such discretionary decisions and held that "courts must defer to discretionary decisions in the absence of bad faith on the part of decision-makers, the exercise of discretion for an improper purpose, or the use of irrelevant considerations."

The Court held that there was no evidence of bad faith or the use of irrelevant considerations, and further held that the Bureau was under no obligation to provide a copy of the external economist's report to the complainants. It was sufficient that the essential points and conclusions of the economist's report were contained in the Commissioner's report, which was provided to the complainant. The court pointed out that the complainant was invited to reply to the Commissioner's report, and the applicant did not have a valid reason for not taking that opportunity, since it had no right to more information than what the Commissioner had already disclosed. This decision confirms the Commissioner's very broad discretion in conducting and discontinuing inquiries, and the high threshold for judicial intervention in the Commissioner's decisions in that regard.

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