Federal Court of Appeal upholds Competition Bureau’s successful challenge of Secure and Tervita merger
August 2, 2023 – GATINEAU, QC – Competition Bureau
The Federal Court of Appeal has dismissed a petition by Secure Energy Services, upholding the Competition Bureau’s successful challenge of the merger of two rival suppliers of oilfield waste services.
Secure’s appeal looked to overturn a recent decision by the Competition Tribunal that ordered the company to sell 29 facilities to resolve ongoing harm to competition in Western Canada.
The Tribunal concluded that there was a substantial lessening of competition in 136 local markets in the Western Canadian Sedimentary Basin (WCSB) as a result of Secure’s merger with Tervita Corporation. The Tribunal also determined that Secure did not meet the requirements of the efficiencies defence which it invoked. Secure’s appeal focused on the Tribunal’s conclusions regarding the efficiencies defence.
In its decision, the Federal Court of Appeal found no merit in any of the issues raised by Secure in its appeal. The appeal was dismissed with costs to be awarded to the Bureau.
Upholding the Tribunal’s decision protects competition for oil and gas waste services used by producers in the WCSB.
“I am pleased that this matter was heard and resolved quickly. Competitive pricing and quality service need to be brought back to affected customers in the oilfields in the Western Canadian Sedimentary Basin.”
Commissioner of Competition
Pre-merger, Secure and Tervita were the two largest suppliers, and in many areas, the only suppliers of oil and gas waste services in the WCSB and vigorously competed with one another to win customers.
The WCSB, which spans southwestern Manitoba, southern Saskatchewan, Alberta, northeastern British Columbia and the southwest corner of the Northwest Territories, contains one of the world’s largest reserves of petroleum and natural gas.
Section 96 of the Competition Act prevents the Competition Tribunal from issuing an order with respect to a merger if the merging parties can demonstrate efficiencies that will be greater than, and offset, the anticompetitive effects resulting from the merger and that the gains in efficiency would not likely be attained if the order were made.
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The Competition Bureau, as an independent law enforcement agency, ensures that Canadian consumers and businesses prosper in a competitive and innovative marketplace.
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