Canada Competition Bureau Brief

Headline

Canada's Competition Bureau secures consent agreement with Empire Company to eliminate grocery property controls restricting competitor entry

Executive Summary

The Competition Bureau of Canada reached a consent agreement with Empire Company Limited on September 22, 2026, requiring the company to address restrictive property controls that limited competitor access to grocery retail locations across Canada. Empire operates Sobeys, Safeway, Farm Boy, IGA, FreshCo, Foodland, Marché Bonichoix, and Les Marchés Tradition.

The agreement imposes enforceable obligations on Empire without a finding of liability at trial, bypassing a contested Tribunal hearing.

Bottom Line

The consent agreement imposes binding obligations on Empire Company to modify or eliminate property controls the Bureau determined restrict competitor entry into grocery retail locations. The agreement's registration with the Competition Tribunal gives it the force of a Tribunal order, enforceable through contempt proceedings.

The Bureau's explicit framing of grocery property controls as a sector-wide concern places every major Canadian grocery operator that uses restrictive covenants or exclusive-use lease clauses within the same analytical and enforcement framework applied to Empire. Rival chains are not named respondents, but the Bureau's stated rationale applies to their property portfolios by definition.

Key Regulatory Signals

• Property Controls Targeted as Anti-Competitive Instruments: The Bureau's agreement identifies Empire's use of restrictive covenants and lease controls on grocery properties as conduct that limits where competing grocers can operate. Landlords, property developers, and rival grocery operators holding or seeking leases near Empire-controlled sites now face a changed legal baseline for what those controls can require.
• Multi-Banner Scope Extends Reach of the Agreement: Empire's eight grocery banners span conventional, discount, and specialty formats across multiple provinces. The agreement's obligations attach to the consolidated entity, meaning property controls associated with any banner fall within its scope, not only those bearing the Sobeys name.
• Consent Agreement Sets Enforceable Obligations: A consent agreement registered with the Competition Tribunal carries the force of a Tribunal order. Empire must comply with its terms or face contempt proceedings, giving the Bureau a direct enforcement path without requiring a contested hearing.
• Grocery Sector Property Controls Now Under Active Bureau Scrutiny: The Bureau has framed grocery property controls as a sector-wide concern, not an isolated Empire issue. Other grocery chains that use restrictive covenants or exclusive-use clauses in property agreements operate under the same analytical framework the Bureau applied here.
• Precedent for Structural Remedies in Retail Grocery: This agreement represents the Bureau's use of behavioral and structural property remedies in the grocery sector following the federal government's direction to examine grocery competition. Peer grocery operators with similar property control portfolios now sit within the Bureau's stated enforcement perimeter.

Regulatory Delta

- The Bureau's prior activity in the grocery sector focused on merger review. This agreement marks a shift to behavioral enforcement against existing property control practices at an established operator. - The consent agreement mechanism bypasses a contested Tribunal hearing, establishing enforceable obligations on Empire without a finding of liability at trial. - The federal government's 2023 directive to the Bureau to examine grocery sector competition provides the legislative and policy backdrop against which this agreement was negotiated and announced.

Materiality Classification

HIGH — The Bureau explicitly frames grocery property controls as a sector-wide concern, meaning peer grocery operators using restrictive covenants or exclusive-use lease clauses must now assess their own property portfolios against the enforcement standard applied to Empire.

Intelligence Outlook

Monitor the Competition Bureau's news releases and Competition Tribunal registry for additional consent agreements or enforcement proceedings against other Canadian grocery operators on property control grounds.