Cover Story  
by Marzena Czarnecka

Regulatory risk was the big story in 2012, for both the deals that made it and those that did not

It used to be a footnote on a deal lawyer's agenda. No more.

In 2012, regulatory risk took centre stage in Canada in an unprecedented way. In 2010, when Ottawa killed BHP Billiton Ltd.'s $40-billion run at Potash Corporation of Saskatchewan, savvy lawyers did step up their focus on prepping clients for clearing Canadian regulatory hurdles — but they did so proactively. Regulatory risk was on everyone's lips, yes, but the inclination was to dismiss BHP as a blip — a one-off incident, a deal so big and unique that it was impossible to argue it set any type of precedent.

That turned out to be a Pollyanna interpretation, as 2012 proved in spades. The deal that dominated the country's business headlines in 2011 – Maple Group Acquisition Corporation's bid for TMX Group Inc. – languished before the regulators until July 2012. Later in the year, the Canadian Radio-Television & Telecommunications Commission killed BCE Inc.'s $3.38-billion bid for Astral Media Inc. Before the markets digested this announcement, Investment Canada declared that the $6-billion purchase of Calgary's Progress Energy Corp. by Malaysian state-owned enterprise PETRONAS was not of net benefit to Canada (although it was eventually approved) — and made it clear to the China National Offshore Oil Corporation (CNOOC) that the federal government's various trade treaties and professions of love for China notwithstanding, its $15.1-billion bid for Calgary-based Nexen Inc. was not going to be a regulatory cakewalk either.

“For better or worse, the Canadian government has put itself on the map,” says Torys LLP's Sharon Geraghty. “It was not that long ago that Canadian regulatory risk was a small blip on the horizon.”

In 2012, it defined the year.

by Julius Melnitzer

Seven of our 10 top cases can be regarded as pro-business, but that doesn't mean all businesses are happy with how they have fared in the courts

It's becoming more and more difficult to determine how business has fared in Canadian courts. The reason? Increasingly, our Top 10 Business Decisions features cases that pit business against business, or commercial interests against commercial interests. So whether a ruling is pro-business or anti-business may well depend on which business or industry is analyzing the case.

Take, for example, the Amazon one-click patent decision. The ultimate ruling, which expands the patentability of business methods, makes the financial sector's business systems better fodder for patent trolls; on the other hand, it spurs innovation and keeps the notion of patentability current.

So is Amazon a pro-business decision or an anti-business decision? On the whole, we believe that broader patentability trumps individual industry interests. So we're calling it a pro-business decision, in keeping with our policy of looking at the impact of the business community as a whole in determining whether a decision is favourable or not.

As has been our practice, we considered decisions from any level of court or tribunal rendered between November 1, 2011, and October 31, 2012. We solicited the opinions of over 40 law firms in arriving at our choices.
by Sandra Rubin

While the market for mobile payments is evolving at a rapid pace, the law is still lagging far behind

Jim Swanson, a technology practitioner at Burnet, Duckworth & Palmer LLP in Calgary, has what looks like a skinny chess pawn on his car keys. It's a fob. When he wants to fill up, all he has to do is pull in to an Esso station and pump the gas; the fob takes care of everything else. It's a conduit to his credit card, so he's charged for the gas. It collects his Air Mile points, his Esso Extra points and once Esso's computers run the fob account over to his bank, his credit-card points as well.

Welcome to the new frontiers of the cashless future. Honestly, unless you're a tech geek, you probably have no idea of what's about to hit. With the help of near-field communication technology, mobile-payment applications are revolutionizing daily commerce. One day soon, and probably a lot sooner than you might imagine, you won't need to carry a bulky wallet. You'll carry a digital wallet. Everything you need – including your credit cards, store cards, gift cards, points cards and transit pass – will be stored on your smart phone.

In the US, Google has partnered with MasterCard, Citigroup and Sprint Nextel to develop the Google Wallet. Verizon, AT&T and T-Mobile USA are working on a rival mobile-payments app called Isis. And similar alliances are being negotiated in Canada; most just haven't been made public, says Matthew Peters, national leader of markets and a technology practitioner at McCarthy Tétrault LLP in Vancouver. “Off the top of my head I can think of at least three public-sector clients that are involved in ventures like this,” Peters says. “But these tend to be private commercial deals that are typically not released.”