Public Health Agency of Canada

11/19/2021 | Press release | Distributed by Public on 11/19/2021 07:31

Competition Bureau reaches agreement with Paper Excellence to preserve competition in British Columbia’s pulp and paper industry

November 19, 2021 - GATINEAU, QC - Competition Bureau

The Competition Bureau announced today that it has reached an agreement to address competition concerns with the merger of two of Canada's largest pulp and paper manufacturers - Karta Halten B.V. (Paper Excellence) and Domtar Corp.

A Bureau review concluded that the proposed transaction would likely lessen competition substantially for the purchase of wood fibre - a key input in the manufacture of pulp - from the Thompson/Okanagan region of British Columbia.

The Bureau determined that the proposed transaction is anti-competitive because it would provide Paper Excellence with monopsony power in a large part of southern British Columbia. This would enable Paper Excellence to pay lower than competitive prices to sawmills and other suppliers of wood fibre in a region of British Columbia where Paper Excellence already has a high concentration of pulp mills.

To resolve the Bureau's concerns, Paper Excellence has agreed to sell Domtar's pulp mill in Kamloops, BC, following its acquisition. The sale will be made to an independent purchaser to be approved by the Commissioner of Competition.

The Commissioner is satisfied that the sale of the Kamloops mill will resolve the competitive issues arising from the proposed transaction. The complete agreement will be available on the website of the Competition Tribunal shortly.