Canadian Bread Price-Fixing Scheme Now Linked To Loblaw, Walmart, Sobeys And Meto

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Senior executives of the two largest bakery wholesalers communicated directly with each other and agreed to raise prices together, the Competition Bureau said in a legal document released Wednesday. Wholesalers subsequently met five retailers, who agreed to apply the price increase provided that their competitors do so, the document goes on.

The Competition Bureau finds wholesalers Canada Bread and George Weston, as well as Loblaw retailers, Walmart Canada, Sobeys, Metro and Giant Tiger, to have committed criminal offenses under the Competition Act, according to the information provided by the Competition Bureau. which was previously under seal.

Canada Bread and George Weston have agreed to jointly raise prices for baked goods – on average 7 cents – for more than a decade from 2001, the paper says. Affected products included buns, bagels, naan bread, English muffins and tortillas, he says.

The suppliers would then have met individually with their retail customers for approval of the price increases. Retailers have accepted the increase, provided that their competitors also agree to maintain the price set on the market, add the documents.

“In addition, retailers have asked that suppliers actively manage retail competition by coordinating retail prices for their respective commercial fresh bakery products and ensuring price alignment among retailers,” they continued. .

According to the documents, this scheme eventually inherited the nickname “convention 7/10” the increase being usually 7 cents for wholesalers and 10 cents for consumers at retailers.

” Unequivocal “

Loblaw and George Weston admitted in December that they were behind the Competition Bureau’s investigation. The two companies claim to have contacted the organization after hearing of an alleged industry-wide agreement to coordinate the prices of certain retail and wholesale bakery products from the end of 2001 to March 2015. .

Both companies obtained immunity in exchange for their cooperation. The other five said they were cooperating with the investigators, and some of them said they had nothing to complain about.

Loblaw spokesman Kevin Groh said on Wednesday that the documents were “unequivocal. ”

“We have admitted our role, and we can not set prices alone,” he noted, adding that the company maintained its previous statements and was still comfortable with the decisions it made.

Canada Bread issued a statement shortly after the release of the documents, claiming to have heard of these allegations for the first time in December. However, he was not allowed to discuss it before the information was made public.

She noted that informants for George Weston and Loblaw had admitted their inappropriate conduct and accused “some former Canada Bread executives” back in 2001 “while Canada Bread had another owner. ”

Maple Leaf Foods sold its majority stake in Canada Bread to Mexican Grupo Bimbo in 2014.

“The allegations are not reflective of the Canada Bread we know,” the company said on Wednesday.

“Our current management team takes these allegations very seriously, and we are actively investigating to take the necessary action. ”

Metro said Wednesday that nothing in the documents indicates that the company had breached the laws of competition. It added that it opened an internal investigation after the Competition Bureau executed a search warrant in its offices on October 31.

“Based on the information we have processed to date, we have not found any evidence that Metro has violated the Competition Act. ”

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