The Purpose, Nature and Constitutionality of the Presumptions of Section 69 of the Competition Act

Abstract

The object of this paper is to discuss and analyze the purpose, evidentiary nature and constitutional aspects of s. 69(2) of the Competition Act. The section facilitates the admission in evidence of records found in the possession of a participant, on its premises or in the possession of one of its agents. Once the records are admitted as evidence, the section goes on to provide for rebuttable presumptions applicable against alleged participants to anti-competitive offences. These presumptions apply in both civil and criminal matters. In criminal cases, the section assists the prosecution in establishing a connection between an alleged agent of a participant and an alleged participant in that, in the absence of evidence to the contrary, the latter’s knowledge and authority with respect to anything done, said or agreed by the agent or records received or written by him is deemed to have been proven. In 2014, notwithstanding 60 years of reliance by prosecutors and the courts, the presumptions set out in s. 69(2) were declared unconstitutional and of no force and effect in criminal cases by a judge of the Ontario Superior Court in R v. Durward. There, the trial judge found that the presumptions violated the right of an accused to be presumed innocent as guaranteed by ss. 7 and 11(d) of the Charter and that such infringement failed a s. 1 analysis under R. v. Oakes. First, the authors review the historical background and parliamentary debates to determine the purpose of the legislature in enacting the predecessor to s. 69. The authors then turn to consider the burden of proof placed on the accused to rebut the presumptions and whether the inferences are permissive or mandatory upon the trier of fact. The authors then discuss the constitutional issues raised under ss. 7 and 11(d) in light of the court’s ruling in Durward. Finally, the article briefly examines whether the violation can or cannot be demonstrably justified under s. 1 of the Charter. In particular, the authors explore the question of the importance of the Competition Act’s objective in general and the specific purposes sought by the presumptions of s. 69(2). The authors respectfully counter the Superior Court in Durward in that all presumptions set out under s. 69(2) cast an evidentiary burden on the accused, who may rebut the presumptions by adducing evidence to prevent the deemed inference. A review of the jurisprudence shows that the presumptions do not directly force the inference of elements of anti-competitive offences. Rather, s. 69(2) requires the trier(s) of fact to infer certain facts, but the presumptions do not compel conviction, as the trier(s) may weigh the totality of the evidence and conclude that the accused is not guilty of the indicted offence notwithstanding the deemed inference assuming no rebuttal evidence is led. While permissive presumptions of guilt do not violate the presumption of innocence, this paper maintains that in certain circumstances, the mandatory fact inferences set out under s. 69(2) may nonetheless lead to an infringement of ss. 7 and 11(d). In any event, the deemed presumptions nonetheless likely pursue a “pressing and substantial objective” and therefore satisfy the first step of the Oakes analysis. The constitutional validity of s. 69(2) will turn on the proportionality analysis mandated by Oakes, that is whether the overall benefits of the provision outweigh the negative effects produced by the breach of the presumption of innocence. If there is a Charter breach, the Ontario Court of Appeal will have to decide whether s. 1 of the Charter ought or ought not to save the provision on the basis of proportionality and validate 60 years of previous litigation.

Keywords: competition law, antitrust, criminal law, white collar crime, competition policy, corporate criminal liability, constitutionality, criminal evidence, statutory presumptions

JEL Classification: K14, K20, K21