Loblaw’s vow to eliminate property controls a ‘key milestone,’ Competition Bureau says

Canada’s competition watchdog said it is monitoring Loblaw Companies’ recent commitment to end property controls. 

The Competition Bureau said the food retail giant’s public commitment relating to restrictive covenants and exclusivity clauses marks a “key milestone for competition in the Canadian grocery industry.”

Loblaw has committed to eliminating existing restrictive covenants. 

It plans to either remove the restrictive covenant from land titles or inform landowners that it will not enforce the restrictive covenant. It will also not enter into new restrictive covenants.

With regards to exclusivity clauses, Loblaw has committed to: 

• waiving all exclusivity clauses in Halifax and in communities across the country where they operate the only grocery store;
• granting waivers for, and not entering into, exclusivity clauses that prohibit other tenants from operating a retail store that sells only a subset of the products typically sold by a grocery store
• not enforcing, or entering into, exclusivity clauses that extend beyond the land where the Loblaw store is or will be located;
• not including restrictions on the sale of food products in new leases for Shoppers Drug Mart (Pharmaprix in Quebec), effective November 2024

The Competition Bureau said its investigation into property controls in the Canadian grocery industry is ongoing. 

The agency released guidance last week urging retailers to drop property controls.