A rule that prevented any other grocery store from doing business in Crownest Pass, Alta., has been lifted, paving the way for a new business to open in the region later this year.
Competition Bureau Canada, an independent law enforcement agency that ensures fair competition among Canadian businesses, said Thursday that Empire Company Limited, agreed to remove a regulation that restricted the development of grocery store competition.
Empire operates all Sobeys, Safeway, IGA and FreshCo stores across Canada, as well as Thrifty Foods, Longos, Foodland, Farm Boy, Les Marchés Tradition and Marché BoniChoix, IGA Extra and Needs Convenience stores in Atlantic Canada.
It operates the only grocery store, an IGA, in Crowsnest Pass.
The Competition Bureau said it became aware of the restriction, also known as a property control, imposed by the company in 2017.
“The Bureau’s investigation found that the restriction protected Empire’s grocery store from competition and ensured that it would continue to be the only grocery store in the area,” the bureau said in a news release.
Now that the property control has been lifted, officials say a new grocery store competitor can move ahead with plans to open a second store in Crowsnest Pass.
“Market forces – not property controls – should determine whether and where new grocery stores can open in communities across Canada,” said commissioner of competition Matthew Boswell in a statement.
“The removal of this property control in Crowsnest Pass will allow for more grocery competition to the benefit of its residents. We encourage all businesses that use property controls to review them and ensure that they comply with the law.”
What are property controls?
The Competition Bureau says property controls are common in Canada, especially in retail settings, but they can harm competition by impacting the ability to open new stores in a location.
The controls operate by either an exclusivity clause, which prohibits a landlord from leasing space to another tenant that competes with another tenant, or restrictive covenants that prevent purchasers of properties from using them to operate or lease to operators of certain types of businesses.
The Competition Bureau obtained two court orders to examine the use of property controls by Empire and Loblaw Companies Limited.
The investigations are ongoing.
CTV News has reached out to Empire about the property control in Crowsnest Pass and the bureau’s investigation.
Crowsnest Pass is located approximately 240 kilometres south of Calgary and 156 kilometres west of Lethbridge.
