indicator series

Whether the market shares of firms are stable or fluctuate over time is also relevant, as is the extent to which product differentiation affects the degree of direct competition among firms. Further, the Bureau assesses whether competitors are likely to remain as vigorous and effective as they were prior to the merger. 4.14 Various functional indicators help to determine what products are considered substitutes, including end use, physical and technical characteristics, price relationships and relative price levels, as well as buyer switching costs, as discussed below.

• Tucker et al. found that the red radiance measured above corn and soybean crops decreased as the season progressed, due to increased chlorophyll absorption by increased leaf area index .
• Footnote 68For example, when the products produced by the merged firm include intermediate goods that are used as inputs in other products, price increases in the intermediate goods can contribute to allocative inefficiency in interrelated markets.
• Footnote 52For example, a vertical merger may allow the merged firm to remove or «internalize» existing double marginalization, since there is no longer any need for a mark‑up on goods from the upstream firm to its downstream merger partner.
• The «offset» aspect requires that efficiency gains compensate for the anti‑competitive effects.

An interlocking directorate is generally of interest under section 92 of the Act only when the interlocked firms are competitors, are vertically related, or produce complementary or related products. 1.14 Persons already holding a significant interest in the whole or a part of a business may trigger the merger provisions of the Act by acquiring or establishing a materially greater ability to influence the economic behaviour of the business. The Competition Bureau («the Bureau») has issued these guidelines to provide general direction on its analytical approach to merger review.

Market definition, and the measurement of market share and concentration in the relevant market, is not an end in itself. Consistent with this, section 92 of the Act precludes the Tribunal from concluding that a merger is likely to prevent or lessen competition substantially solely on the basis of evidence of concentration or market share. The ultimate inquiry is not about market definition, which is merely an analytical tool — one that defies precision and can thus vary in its usefulness — to assist in evaluating effects.

Complex products and differences in product offerings and cost structure tend to make it more difficult for firms to reach profitable terms of coordination. Similarly, markets with rapid and frequent product innovations, or that are in a period of rapid growth, are less conducive to coordinated behaviour. 6.27 Competition is likely to be prevented or lessened substantially when a merger materially increases the likelihood of coordinated behaviour when none existed before, or materially increases the extent or effectiveness of coordination beyond that which already exists. When making this assessment, the Bureau considers a number of factors, including the presence of factors necessary for successful coordination and those that are conducive to coordination. The mere presence of such factors, however, is not sufficient to conclude that there are competition concerns.

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Further, acquiring a subset of the assets of a business that is capable of being used to carry on a separate business is also considered to be the acquisition or establishment of a significant interest in the business. With respect to corporations, section 2 of the Act defines «control» to mean de jure control—that is, a direct or indirect holding of more than 50 percent of the votes that may be cast to elect directors of the corporation, and which are sufficient to elect a majority of such directors. With respect to partnerships, section 2 provides that a partnership is controlled by a person when the person holds an interest in the partnership that entitles the person to receive more than 50 percent of the profits of the partnership or more than 50 percent of its assets on dissolution. Delaro® Complete provides excellent protection against yield robbing diseases such as common rust, eye spot, Northern corn leaf blight and tar spot. Our range of silage ready hybrids are designed for maximum yields and increased milk and meat production. The result is that the crop is engineered to be resistant to certain insect pests, pathogens and/or herbicides in order to protect the crop and increase quality and yield.

Footnote 68For example, when the products produced by the merged firm include intermediate goods that are used as inputs in other products, price increases in the intermediate goods can contribute to allocative inefficiency in interrelated markets. Footnote 66A rationalization of the parties’ facilities located outside of Canada where it could be established that these efficiencies would likely result in lower prices in Canada is an example of how such gains in efficiency from non‑Canadian sources could accrue to the Canadian economy. The issue is whether the efficiency gains will benefit the Canadian economy rather than the nationality of ownership of the company. Footnote 19Changes in terms of sale of other products in response to the merger are accounted for in the analysis of competitive effects and entry. In some cases, liquidation can facilitate entry into a market by enabling actual or potential competitors to compete for the failing firm’s customers or assets to a greater degree than if the failing firm merged with the proposed acquirer.

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Therefore, functional interchangeability is not sufficient to warrant inclusion of two products in the same relevant market. In general, when buyers place a high value on the actual or perceived unique physical or technical characteristics of a product (including warranties, post‑sales service and order turnaround time), it may be necessary to define distinct relevant markets based on these characteristics. Studies conducted by Owrangi et al., 2011 put forward a fast, efficient and reliable method for producing drought maps from NOAA-AVHRR and comparing it with SPOT vegetation maps which confirms that SPOT vegetation maps can be used as a reliable substitutes for any missing or cloudy NOAA-AVHRR data. The Drought Severity Index maps derived from NDVI maps showed reasonable vegetation cover during the years which confirms rational yields. Singh et al. used NDVI, Vegetation Condition Index and Temperature Condition Index to monitor droughts as well as estimate vegetation health.

Footnote 15Section 93 provides that the Tribunal «may» have regard to the listed factors, while section 93 permits the Tribunal to consider any other relevant factor. Rather, these factors form part of the analysis of competitive effects, to the extent they are relevant in a particular just2trade review case. The Bureau encourages parties in their submissions to focus only on the factors and evidence that are relevant to the assessment of the impact of their merger on competition, rather than to treat the section 93 factors as a «checklist» to address in every case.

On the other hand, when the merged firm holds a significant share of excess capacity in the relevant market, this may discourage rivals from expanding. Footnote 49As noted below in paragraph 12.3, in reviewing a full merger the Bureau may make an assessment of whether the efficiency gains that are likely to be brought about by the merger will be greater than and will offset the anti‑competitive effects of that merger. By contrast, minority interest transactions typically do not involve the integration of firms and therefore efficiency gains are not typically considered by the Bureau in reviewing minority interests. 12.6 For the purpose of the trade‑off analysis in litigated proceedings before the Tribunal, the Bureau must show the anti‑competitive effects of a merger.

The underlying assumption is that profit‑maximizing firms make decisions about where to locate based on the density of their buyer base and try to avoid cannibalizing their own sales when they have two or more locations in close proximity. The Bureau may use spatial competition analysis to help delineate the boundaries of localized geographic markets.Footnote 26 The methodology for applying spatial competition analysis depends on the characteristics of the industry and the market under consideration. Researchers at NDMC stated that analysis of time-series NDVI data and NDVI-derived metrics have been an effective means for identifying vegetation condition anomalies such as apparent declines in vegetation health. The VegDRI uses powertrend concepts from remotely sensed NDVI and climate based drought index approaches to produce 1 km resolution maps that characterizes the intensity and spatial patterns of drought induced vegetation stress over large areas. The NDVI maps at 1 km resolution provides information on spatial patterns of vegetation which are analyzed by combining dryness information from climate based drought index data to provide the intensity and spatial extent of drought conditions. VegDRI was developed through a collaborative research between the National Drought Mitigation Center and USGS Earth Resources Observation and Science Center and its aim is to provide near-real time information as a national drought monitoring tool for United States.

12.28 Price increases resulting from an anti‑competitive merger cause a redistributive effect («wealth transfer») from buyers to sellers. 12.11 Typically, the Bureau uses industry experts to assist in its evaluation of efficiency claims. This includes plant and firm‑level accounting statements, internal studies, strategic plans, integration plans, management consultant studies and other available data. The Bureau may also require physical access to certain facilities and will likely require documents and information from operations‑level personnel who can address, among other matters, how their business is currently run and areas where efficiencies would likely be realized.

While NDVI has proven useful for timely estimation of vegetation condition, however, it does not allow for relative comparison at a pixel location or time period (Burgan and Hartford, 1993; Kogan, 1995; Peters et al., 2002). NDVI data has been extensively used for more than a decade in classifying vegetation condition. Kogan , suggested an approach to vegetation condition monitoring based on minimum and maximum NDVI values compiled per pixel over time (Peters et al., 2002).

Part 9: Monopsony power

Whether the firm is unlikely to be able to successfully reorganize pursuant to Canadian or foreign bankruptcy legislation, the Companies’ Creditors Arrangement Act, or through a voluntary arrangement with its creditors. These guidelines supersede previous merger enforcement guidelines and statements made by the Commissioner of Competition («the Commissioner») or other Bureau officials. The Bureau may revisit certain aspects of these guidelines in the future based on amendments to the Act, decisions of the Tribunal and the courts, developments in the economic literature and the Bureau’s case experience. Proline is the only corn fungicide to control all major leaf diseases, protect against stalk rot and gibberella ear rot, effectively reducing DON.

In such cases, the analysis focuses on the likely future effectiveness of independent sources of competition, regardless of their current shares. Bidding and bargaining markets are discussed in additional detail under «Unilateral Effects» in Part 6. Footnote 14A material price increase is distinct from the «significant and non‑transitory price increase» that is used to define relevant markets, as described in Part 4, below. For purposes of the statement above, materiality includes not only the magnitude and scope but also the sustainability of the price increase.

12.9 To be considered under section 96, it must be demonstrated that the efficiency gains «would not likely be attained if the order were made.» This involves considering the nature of potential orders that may be made, including those that may apply to the merger in its entirety or are limited to parts of the merger. Each of the anticipated efficiency gains is then assessed to determine whether these gains would likely be attained by alternative means if the potential orders are made. Where the order sought is limited to parts of a merger, efficiency gains that are not affected by the order are not included in the trade‑off analysis.

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8.2 The Bureau does not presume that a buyer has the ability to exercise countervailing power merely by virtue of its size. There must be evidence that a buyer, regardless of size, will have the ability and incentive to constrain an exercise of market power by the merged firm. Evidence of prior dealings between the buyer and one or more of the merging parties that tends to demonstrate the buyer’s relative bargaining strength is of particular relevance. The Bureau also considers the extent to which the merger affects the beaxy exchange review buyer’s ability and incentive to exercise countervailing power. When a merger eliminates a supplier whose presence contributed significantly to a buyer’s historical bargaining strength, the buyer may no longer be able to exercise countervailing power after the merger. 6.13 In markets in which products are differentiated, a merger may create, enhance or maintain the ability of the merged firm to exercise market power unilaterally when the product offerings of the merging parties are close substitutes for one another.

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Footnote 72The burden is ultimately on the parties to undertake the entire trade‑off analysis and establish that the gains in efficiency are greater than and offset the anti‑competitive effects. 12.33 The «greater than» aspect of the test requires that the efficiency gains be more extensive or of a larger magnitude than the anti‑competitive effects. The «offset» aspect requires that efficiency gains compensate for the anti‑competitive effects. The additional requirement to «offset» makes it clear that it is not sufficient for parties to show that efficiency gains merely, marginally or numerically exceed the anti‑competitive effects to satisfy the section 96 trade‑off. How significant this additional requirement may be has yet to be tested by the Tribunal and the courts.

Rather, at issue is whether the merger impacts these factors in such a way that makes coordination or more effective coordination more likely. 4.11 When detailed data on the prices and quantities of the relevant products and their substitutes are available, statistical measures may be used to define relevant product markets. Demand elasticities indicate how buyers change their consumption of a product in response to changes in the product’s price (own‑price elasticity) or in response to changes in the price of another identified product (cross‑price elasticity).

A conglomerate merger is a merger between parties whose products do not compete, actually or potentiallyFootnote 50, and are not vertically related. Conglomerate mergers may involve products that are related because they are complementary (e.g., printers and ink cartridges),Footnote 51 or because customers buy them together owing to purchasing economies of scale or scope. 6.34 A history of collusion or coordination in the market is also relevant to the Bureau’s analysis, because previous and sustained collusive or coordinated behaviour indicates that firms have successfully overcome the hurdles to effective coordinated behaviour in the past.