First examined in Citizen's Insurance Co. v. Parsons (1881), Sir Montague Smith of the Judicial Committee of the Privy Council determined its scope thus: ... ...
This principle was eventually rejected in Toronto Electric Commissioners v. Snider and Proprietary Articles Trade Association v. Attorney General of Canada, but the power was still read strictly.
In Caloil Inc. v. Canada (1971) the Court upheld a law prohibiting the movement of imported oil as a form of regulating inter-provincial trade.
On the contrary, it is no objection when the impugned enactment is an integral part of a scheme for the regulation of international or interprovincial trade, a purpose that is clearly outside provincial jurisdiction and within the exclusive federal field of action.
In Labatt Breweries v. Canada, Estey J. held that the regulation of the composition of "light beer" under the Food and Drugs Act was invalid as it was too narrow to be directed towards trade.
Competition law, by contrast, regulates only anti-competitive contracts and conduct — a particular aspect of economic activity that falls squarely within the federal domain.