Tausi Insider

Royal Bank of Canada’s RY-T proposed $13.5-billion takeover of HSBC Bank Canada will face scrutiny from Canada’s competition watchdogs in the year ahead, but critics say their leash is too short while efforts in the U.S. point to potential ways of doing it better. The proposed deal comes amid a widespread rethink in how corporate consolidation has been treated for decades, with potential new rules in the works both in Canada and the U.S. Current Canadian laws generally don’t challenge an acquisition over market power concerns if it leaves the company with less than 35 per cent of market share, which means many smaller deals don’t face enough scrutiny, said Keldon Bester, a fellow at the Centre for International Governance Innovation who studies competition and monopoly power. “A key issue is that our competition law really only pays attention to the big guys, and often misses the value that the small players play.” He said the loss of HSBC’s Canadian division would remove a player th...