loblaws boycott

Loblaws and Sobeys are now under formal investigation for 'anticompetitive conduct'

Canada's Competition Bureau, which has already concluded that the nation needs more supermarket players to foster a healthy market for consumers, is now investigating George Weston Ltd. (parent company of Loblaws) and Empire Co. Ltd. (which owns Sobeys) for "anticompetitive conduct." 

The investigation, launched March 1, is not about food prices as many might expect, but is about how the companies set special rules in their lease agreements that prevent other grocers from opening in the same plazas, areas, or in spaces recently vacated by a Loblaws or Sobeys store.

They can also control property in other ways, like by limiting what products nearby stores can even sell. And, with both companies having a strong stake in various properties through real estate investment trusts (REITS), they have the potential to heavily sway what happens at a given site.

These controls are, by nature, anti-competitive and restrictive for other chains, further solidifying Loblaws' and Sobeys' dominance in an already very narrow market. This is why the commission's report on the market last year suggested their use be limited or completely forbidden.

According to the Canadian Press, George Weston Ltd. has been cooperating with the probe, while Empire is fighting back against it, saying these types of controls are common across retail and other industries.

Meanwhile, the public is still demanding that Loblaw Companies Inc. be investigated for "profiteering and greedflation" based on grocery prices.

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