The Competition Bureau has initiated a probe into the implementation of minimum advertised pricing policies within the grocery industry. These policies restrict retailers from publicizing their lowest prices, potentially impacting consumers’ ability to find cost-effective deals. The investigation aims to determine if such policies hinder price competition, impede the entry of new discount grocers, and facilitate price coordination among grocery stores.
Jeanne Pratt, the interim competition commissioner, emphasized the importance of grocery stores being able to promote their best deals to meet Canadians’ expectations. Concerns have been raised that restrictions on advertising could limit grocers’ competitiveness and consumers’ access to discounted prices, especially when food affordability is a pressing issue.
Minimum advertised pricing policies establish a price floor for products that retailers can advertise, although they may still sell them for less. These rules are commonly utilized by suppliers in the retail sector to uphold brand reputation, incentivize better service from retailers, and prevent some retailers from capitalizing on others’ promotional efforts.
The Competition Bureau is calling on industry stakeholders and consumers to provide evidence regarding the use of minimum pricing policies. The information gathered will support the ongoing investigation and shape the bureau’s assessment of competition within Canada’s food supply chain.
Earlier in June, the agency commenced an inquiry into competition within the grocery sector, encompassing potential issues related to production, processing, transportation, distribution, and pricing practices.