Competition Bureau requests feedback on regulations governing properties in the grocery sector
The Competition Bureau is actively seeking information from grocery retailers and real estate professionals regarding restrictive real estate clauses in the Canadian grocery industry. The regulator is specifically interested in hearing from stakeholders about property controls, which are currently under investigation in relation to Sobeys and Loblaw. This inquiry is part of a broader investigation initiated earlier this year by the Commissioner of Competition.
Property controls typically involve adding clauses to leases or deeds, known as restrictive covenants, that limit the types of businesses that can occupy a location once a grocery store vacates the premises. For instance, these clauses could prevent competitors or specific businesses like bakeries from moving into the vacated space.
According to the bureau, these restrictions can have anti-competitive effects by preventing other retail food stores from opening or restricting the products that competitors can offer. The Public Interest Advocacy Centre has already examined the impact of restrictive covenants.
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This practice can lead to food deserts where communities lack access to healthy food options, as noted in the submission by the Public Interest Advocacy Centre to the Competition Bureau. The bureau is specifically interested in cases where property controls have hindered the entry of domestic or international grocery retailers in Canada.
Furthermore, the bureau is keen on understanding how property controls have impacted the operations of food retailers and weighing the pros and cons of such restrictions for food retailers, landowners, and landlords. Confidential feedback from industry professionals in the grocery and real estate sectors is encouraged via email.
