Competition Bureau completes civil investigation into Loblaw

No conclusion of abuse of dominance

OTTAWA, Nov. 21, 2017 /CNW/ - The Competition Bureau announced today that it is closing its investigation into allegations of abuse of dominance by Loblaw. The Bureau analysed the impact on competition of policies imposed by Loblaw on its suppliers. Following an extensive review of the full body of evidence, the Bureau concluded that no further action was warranted under the civil provisions of the Competition Act.

During the course of its investigation, the Bureau obtained information from a large number of suppliers, a diverse group of retailers, including Loblaw, and industry associations. The Bureau also collaborated with foreign competition authorities.

Under its policies, Loblaw sought compensation from suppliers when its profitability decreased due to other retailers' competitive activities such as when they sold products at lower prices. Loblaw put an end to several of these policies in January 2016, during the Bureau's investigation.

While a number of suppliers suggested that the policies influenced their dealings with other retailers, these allegations were not sufficiently supported by the full body of evidence. Should the Bureau receive additional information and conclude that any policies are contrary to the law, the Bureau will not hesitate to take action.

The Bureau has issued guidance on key competition law issues observed in the grocery industry. The guidance, along with the details of the Bureau's investigation, is available in a comprehensive position statement on its website.

Quick Facts

• The average Canadian household spends over $5,000 at the grocery store every year. Vigorous competition in the industry is essential to ensure that consumers benefit from low prices, increased innovation, choice, quality and service.
• Loblaw is Canada's largest grocery and pharmacy retailer with around 2,400 corporate, franchised and associate-owned locations throughout Canada. It operates a number of banners, including Loblaws, Real Canadian Superstore, No Frills, Fortinos, Your Independent Grocer, Provigo and Maxi.
• When the Bureau examines alleged anti‑competitive behaviour, it conducts an examination of the available facts and evidence before reaching any conclusions about whether or not the Competition Act has been contravened.
• This discontinued investigation is separate from the criminal investigation into allegations of anti-competitive conduct, in this industry, contrary to the conspiracy provision of the Competition Act.

Quote

"The Bureau has gathered the facts and developed a deep understanding of the complex issues in the grocery industry: we have followed through on our commitment to conduct a thorough review. The line between hard bargaining and anti-competitive conduct is a fine one and firms should be careful not to cross it. The position statement we issued today in connection to this civil investigation provides guidance to the grocery industry on how to stay onside of Canada's competition law."

John Pecman,
Commissioner of Competition

Related Information

Competition Bureau statement regarding its investigation into alleged anti-competitive conduct by Loblaw

Associated Links

Competition and innovation in the Canadian grocery sector: buyer power, concentration, resale price maintenance and deceptive marketing

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