Sobeys’ parent agrees to ease property controls after watchdog’s probe

Canada's Competition Bureau has reached an agreement with Empire, the parent company of Sobeys and other supermarket chains, to ease restrictions on property usage. This comes after an investigation into the tactics employed by Empire, which are argued to reduce competition within the grocery industry. The Competition Bureau stated the agreement removes barriers to competition and supports new entrants and increased competition from retailers selling everyday essential items.

The new consent agreement is legally binding and enforces Empire's commitment to no longer enforce existing restrictive covenants, enter new restrictive covenants, or request others establish such covenants that benefit Empire. The agreement also limits Empire's use of exclusivity clauses, which can prevent landlords from leasing property to competing tenants.

Property controls, as defined by the Bureau, are legal restrictions that limit how a property can be used by others. These restrictions, such as exclusivity clauses and restrictive covenants, prevent grocery stores from operating on certain properties. The Bureau emphasized that since Empire can no longer enforce these property controls, it must also consider and respond to requests to remove existing restrictions.

This move follows increased focus on food affordability for Canadians amid rising living costs, with a 2023 study suggesting that increasing competition could help improve food affordability. This agreement also follows other regulatory actions against grocery conglomerates, like Loblaw, which recently agreed to end its use of property controls in Canada.