Competition Bureau takes action to protect competition in the grocery industry in an Alberta community

GATINEAU, QC, Jan. 16, 2025 /CNW/ - Following a Competition Bureau investigation, Empire Company Limited, a major player in the grocery industry in Canada through its ownership of Sobeys, has agreed to remove a property control that restricted retail grocery store competition in Crowsnest Pass, Alberta.

Empire's IGA store is the only grocery store in Crowsnest Pass. The Bureau recently became aware of a restriction, also known as a property control, imposed by Empire in the region since 2017. The Bureau's investigation found that the restriction protected Empire's grocery store from competition and ensured that it would continue to be the only grocery store in the area.   

The Bureau's investigation and Empire's actions mean that a new grocery store competitor can move forward with plans to open a second store in Crowsnest Pass in 2025. More competition helps make groceries more affordable and increases product options for the residents of Crowsnest Pass.

The Bureau's investigations into the use of property controls by Sobeys' and Loblaw's parent companies are ongoing. The Bureau invites market participants to provide input about the use of property controls in the Canadian grocery industry.

Quotes

"Market forces – not property controls – should determine whether and where new grocery stores can open in communities across Canada. The removal of this property control in Crowsnest Pass will allow for more grocery competition to the benefit of its residents. We encourage all businesses that use property controls to review them and ensure that they comply with the law."

Matthew Boswell
Commissioner of Competition

Quick facts

• Empire Company Limited is the parent company of Sobeys Inc., which operates 1,600 stores across all ten provinces. Its grocery store brands include Sobeys, Safeway, IGA, FreshCo, Foodland, Longos, Farm Boy, Thrifty Foods, Les Marchés Tradition and Marché BoniChoix.
• Competitor property controls are restrictions on the use of commercial real estate. These property controls are common across Canada, especially in retail settings. They can harm competition by making it difficult, or even impossible, for businesses to open new stores.
• There are two types of property controls: exclusivity clauses and restrictive covenants.
  • Exclusivity clauses are generally found in commercial leases. They prohibit the landlord from leasing space to another tenant that competes with the existing tenant.
  • Restrictive covenants are restrictions on land that prevent a purchaser or owner of a commercial property from using the location to operate or lease to operators of certain types of businesses.
• In June 2024, the Bureau announced that it obtained two court orders to advance its investigations into the use of property controls by Sobeys' and Loblaw's parent companies. The investigations are ongoing.
• In August 2024, following significant changes made to modernize to the Competition Act, the Bureau invited Canadians to provide feedback on its preliminary enforcement approach to property controls. The consultation is now closed, and the Bureau is now considering the feedback it received.

Related products

• Competitor property controls and the Competition Act

Associated links

• Retail Grocery Market Study
• Restrictive trade practices
• Implementing changes to the Competition Act
• Guide to the December 2023 amendments to the Competition Act

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The Competition Bureau is an independent law enforcement agency that protects and promotes competition for the benefit of Canadian consumers and businesses. Competition drives lower prices and innovation while fueling economic growth.

SOURCE Competition Bureau

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