Canada Competition Bureau Updates Guidance on Restrictive Property Controls

Canada's Competition Bureau has issued updated guidance urging retailers and landlords to reconsider the use of competitor property controls in commercial leases, such as exclusivity clauses and restrictive covenants, which can limit competition by restricting the types of businesses allowed to operate in certain locations. These property controls, while legal, may hinder market entry or expansion and reduce consumer benefits like lower prices, greater choice, and innovation. The Bureau's guidance follows findings from a 2023 grocery market study that identified these controls as barriers to new entrants in the grocery sector. As part of enforcement actions, the Bureau reached an agreement with Empire Co. Ltd. to remove a restrictive property control in Crowsnest Pass, Alberta, which was limiting grocery competition. The updated guidance reflects recent legislative changes to the Competition Act aimed at strengthening the Bureau's oversight and encourages businesses to ensure their property controls comply with competition laws. This move aligns with the Bureau's ongoing efforts to foster competitive markets and adapt its enforcement approach based on consultations and evolving market conditions.