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Empire Co. Scraps Restrictive Property Clauses Under Regulatory Pressure

Facing a formal investigation by the Competition Bureau, Empire Co. is abandoning the use of restrictive property covenants that effectively barred rival grocers from setting up shop nearby. The move marks a significant shift for the parent company of Sobeys and Safeway, which previously used such controls to stifle local competition.

Empire Co. Scraps Restrictive Property Clauses Under Regulatory Pressure

The company confirmed Tuesday it will cease enforcing and registering exclusivity and radius clauses on its current and formerly owned properties. These legal mechanisms had long prevented specialty food retailers and competing grocery chains from operating in close proximity to the group's various banners, which include Farm Boy, IGA, Foodland, and FreshCo.

This policy reversal follows court orders obtained by the Competition Bureau in late June to probe whether these property controls were actively impeding market competition. The regulatory scrutiny comes as Canadian households struggle with persistent food inflation, forcing many shoppers to hunt for discounts or shift toward more affordable retail alternatives. By removing these barriers, Empire aims to align its real estate strategy with heightened federal oversight of the grocery sector.

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