Competition Bureau to Study Competition in Grocery Sector; Proposes Launch of Merger Registry
The Competition Bureau is launching a market study of grocery store competition in Canada. This comes on the heels of mounting political pressure surrounding increased grocery prices. Market studies are not law enforcement investigations; instead, the Bureau will listen to stakeholders and conduct research to make suggestions about how government can increase competition among grocery retailers.
Specifically, the Bureau wants to find out how changing competitive dynamics are impacting grocery store prices and examine what governments can do to lower barriers to entry and stimulate competition. The focus of the study is retail competition, and the Bureau does not plan to focus on issues relating to suppliers.
The Bureau will seek voluntary information and cooperation from market participants and industry experts. In contrast to other jurisdictions (e.g., United States, European Union, United Kingdom), the Competition Bureau cannot compel cooperation with its market studies. In the United States, for example, the US FTC has an ongoing market study into competition in the grocery sector, which it launched in 2021.
The study is on an expedited timeline. The Bureau is accepting written submissions from stakeholders until December 16, 2022, and plans to publish its final report in June 2023.
Proposed Launch of Register of Ongoing Merger Reviews
The Bureau has published a new Information Bulletin on Transparency. These guidelines suggest the Bureau may soon list in real time, ongoing mergers being investigated by the Bureau.
Since 2012, the Bureau has maintained a register of concluded merger reviews. Presently, it is uncommon for the Bureau to publicly confirm an ongoing investigation, except in very high-profile matters.
The Bureau has not indicated how its proposed ongoing merger register will approach non-notifiable mergers (i.e., discretionary investigations of transactions that fall below the dollar thresholds for pre-merger notification). Nor has the Bureau provided guidance on how it will approach transactions that have notified regulators prior to a public announcement.
For further information concerning these developments, please contact any member of our Competition and Foreign Investment Group.
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