A government commission has recommended that federal authorities act to break up Canada's large newspaper chains and restrict publishers' business activities, drawing a sharp reaction today from the newspapers.

"Unacceptable and dangerous" and "idiot's delight" were representative descriptions by Canadian editorialists of the recommendations announced Tuesday by a three-man inquiry into monopolies in Canada's print media.

The inquiry, set up last year after two major daily papers closed, concluded that concentration in the industry had reached "monstrous" proportions. It urged the government to enact tough new measures to enhance the quality and independence of Canadian dailies.

The report opened the possibility of an eventual clash between the federal government and two chains -- Southam Press and Thomson Newspapers -- which between them control 59 percent of the English-language newspapers in this bilingual country.

A Canadian government spokesman promised "some action" by fall on the report, "even if it means another perhaps serious confrontation" for the government. But most observers doubted that Prime Minister Pierre Trudeau's Liberal administration would be quick to take on the newspaper industry. The government is already embroiled in serious disputes with Canada's 10 provincial governments over energy and constitutional issues.

The commission recommended enactment of a Canada Newspaper Act that would bar ownership of a "national" newspaper by a chain owning other dailies. This would require Thomson to sell either The Globe and Mail of Toronto, which prints editions across Canada, or the chain's other 39 papers.

The commission would also like to see limitations on newspaper ownership by corporations involved in businesses other than publishing and would like to outlaw concentration of ownership in individual regions of the country.

Reacting to the report yesterday, Southam Inc. President Gordon Fisher said the recommendations were more "drastic than necessary and more drastic than the industry expected."

The Saint John (New Brunswick) Telegraph-Journal said: "There may be weaknesses in some of Canada's newspapers but all that is better than having Big Brother deciding the future ownership and the future of the press in Canada."

The Globe and Mail said the commission's recommendations on breaking up Thomson's organization were not worth discussing: "Anything which interferes with the Globe's lifelong dream of serving Canadians from coast to coast is not a subject for debate."

As in the United States, mergers and closures of newspapers in recent years have sharply decreased the number of independent dailies, leaving only 29 of Canada's 117 papers in individual ownership.

The event that in the words of the commission caused "shock and trauma" across the country and led to the year-long inquiry into the industry came last August, when, on the same day, Southam closed The Tribune in Winnipeg and Thomson shut down The Ottawa Journal.