Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Canada Competition Bureau issues no-action letter on armored car services acquisition, (Mar 14, 2014)

By John W. Arden, J.D., LL.M.

The Competition Bureau issued a qualified no-action letter with respect to the proposed acquisition of G4S Cash Solutions (Canada) Ltd. by Garda World Security Corporation, the Bureau announced yesterday. The no-action letter stated that Commissioner of Competition John Pecman did not intend to make an application under section 92 of the Competition Act regarding the transaction, given a commitment by Garda World to alter certain contracting practices relating to the provision of cash solution services in Quebec.

The transaction was a merger between two providers of cash solutions services, including cash-in-transit service with armored vehicles, ATM services, vaulting and safe services, and various other cash management services. National service provider GardaWorld and G4S Canada were competitors throughout the Province of Quebec, in Eastern Ontario, and in the Greater Toronto area.

The changes in contracting practices are intended to make it easier for armored car services customers to exit their contracts and switch to another service provider. In particular, GardaWorld will allow customers to terminate their contracts without penalty on 30 days written notice and will notify all GardaWorld and G4S armored car services customers in Quebec of the terms of its commitment to the Bureau. The Bureau intends to monitor the post-merger competitive dynamics in this industry.

“Our review concluded that the GardaWorld and G4S transaction raised competition issues relating to armored car services in Quebec,” said Pecman. “GardaWorld’s commitments are intended to make contract terms more favourable to customers and allow them greater flexibility to exit their contracts and switch to a competing service provider. Should our monitoring of the industry reveal evidence that there has been a violation of the Act, we will not hesitate to take appropriate action.”

The parties announced their merger agreement on August 28, 2013. The transaction was completed on January 17, 2014.

News: Antitrust