e-4974 (Business and trade)

The Government of Canada would like to thank the petitioners for sharing their views on business practices in the grocery sector, and welcomes their input on this important issue.

The Competition Act (the Act) is a federal law that applies, with limited exceptions, to all industries across Canada, including the grocery sector. It is administered and enforced by the Competition Bureau (the Bureau), an independent law enforcement agency. This law prohibits, among other things, agreements among competitors to fix prices and abusive practices by dominant firms that reduce or prevent competition. It also subjects mergers to scrutiny, including mandatory advance notification to the Bureau when they surpass certain size thresholds.

In recent years, the Government has undertaken unprecedented action to bolster the Act and strengthen the Bureau’s enforcement capacity. This includes:

• An increase to the Competition Bureau’s resources in the 2021 Budget, by $96 million over the following five years, and $27.5 million ongoing thereafter.

• The passage of Bill C-19, the Budget Implementation Act, 2022, No. 1, in June 2022 to fix certain loopholes in the Act, tackle business practices harmful to workers and consumers, increase penalties and access to justice, and adapt the law to today’s digital reality.
• The passage of Bill C-56, the Affordable Housing and Groceries Act, in December 2023 to establish a formal market study framework; to remove the efficiencies defence to prevent anti-competitive mergers and collaborations that raise prices and limit choices for Canadian consumers; to subject additional forms of business collaborations to Bureau scrutiny; and to simplify the legal test for abuse of dominance.
• The passage of Bill C-59, the Fall Economic Statement Implementation Act, 2023, in June 2024, with additional amendments to: further modernize merger reviews, including reversing the burden of proof for particularly concentrative transactions; enhance protections for consumers, workers, and the environment; empower the Commissioner of Competition to review and to remedy a wider selection of anti-competitive collaborations; create an anti-reprisal framework; and broaden the reach of the law by enabling more private parties to bring cases before the Competition Tribunal and receive payment if they are successful.

The Bureau is now better-positioned than ever to tackle anti-competitive business conduct. For example, the Bureau has issued preliminary guidance on how it will enforce the broadened law with respect to the use of property controls, and has launched an investigation on potentially anti-competitive real estate restrictions by large grocers. The Government strongly encourages anyone with evidence of price-fixing or other anticompetitive conduct in the grocery sector to file a complaint with the Bureau.

With respect to support for consumer protection, in October 2023, the Government tripled its investment in the Office of Consumer Affairs’ Canadian Consumer Protection Initiative to $5 million annually over the next 5 years. This additional funding is enabling work on a range of initiatives, such as research on market practices, including barriers to grocery competition.

On the topic of the Grocery Sector Code of Conduct, in July 2024 , working in partnership with provinces and territories, the Government of Canada announced the participation of all major retailers in the Code, which is a positive step towards bringing more fairness, transparency and predictability to Canada's grocery supply chain and for consumers.

Once again, the Government thanks you for bringing these concerns forward.