Confidentiality, Conflicts And Comity: Problems and Solutions in the New Era of International Co-operation for the Purposes of Enhancing Competition Law Enforcement

Abstract

With the emergence of transnational business dealings as the norm rather than the exception, international co-operation in the enforcement of competition law has become more important than international co-operation to avoid conflict between individual nations' competition laws. The United States and Canada's most recent attempt to address conflict issues in competition law arising in transnational business dealings was in the negotiation of the 1984 Memorandum of Understanding (hereinafter the ‘MOU’). The MOU is an example of the first stage of international co-operation in competition law as it sets up a framework for the avoidance of conflict in the administration of two countries’ competition laws. However, co-operation to avoid conflicts does not help overcome the jurisdictional difficulties of co-operating countries trying to enforce domestic laws that seek to prosecute foreign conduct with domestic effect, such as those that exist in the US, the European Community and Canada. Six years after the MOU was signed, the Treaty between Canada and the US on Mutual Legal Assistance in Criminal Matters (hereinafter the ‘MLAT’) came into force and signalled a new era of competition law enforcement policy. The MLAT emphasized cooperation between Canada and the US competition enforcement authorities to enhance enforcement, rather than sjmply co-operation to avoid conflict. The expansion of the principle of enforcement enhancement in criminal competition law between the US and Canada to civil competition law was realized by the North American Free Trade Agreement (‘NAFTA’) and more concretely by the recent negotiation of a new agreement between Canada and the US6 (the ‘Canada-US Agreement’). The shift from passive co-operation to avoid conflict in the administration of competition laws to active co-operation to enhance enforcement is significant. The potential result is the correspondent shift in the relationship between a competition enforcement agency and the local business community from a close and open relationship to a more adversarial and closed relationship. A close relationship between a competition enforcement agency and the local business community is necessary as the business community is the enforcement agency's greatest ally in competition law enforcement.