Bakery giant Canada Bread Co. has been fined $50 million after pleading guilty to its role in a criminal price-fixing scheme that inflated the price of bread in Canada for years.
ItB次元官网网址檚 the highest price-fixing fine ever imposed by a Canadian court, the Competition Bureau of Canada said Wednesday.
The settlement is a significant milestone in the competition watchdogB次元官网网址檚 ongoing investigation into alleged bread price-fixing in Canada.
It comes as record food prices fuel consumer discontent with CanadaB次元官网网址檚 food industry and fan distrust of grocers.
It also shines a spotlight on the Competition BureauB次元官网网址檚 ongoing investigation into the role of other companies, including Metro, Sobeys, Walmart Canada, Giant Tiger, and Maple Leaf Foods.
B次元官网网址淔ixing the price of bread B次元官网网址� a food staple of Canadian households B次元官网网址� was a serious criminal offence,B次元官网网址� Matthew Boswell, Commissioner of Competition, said in a statement.
B次元官网网址淥ur continuing investigation remains a top priority,B次元官网网址� he said. B次元官网网址淲e are doing everything in our power to pursue those who engage in price-fixing.B次元官网网址�
Canada Bread, now a subsidiary of Mexico-based Grupo Bimbo, pleaded guilty to four counts of price-fixing under the Competition Act.
The bread maker admitted that it arranged with its competitor, Weston Foods (Canada) Inc., to increase prices for various bagged and sliced bread products, such as sandwich bread, rolls and hotdog buns, the Competition Bureau said.
The price-fixing scheme resulted in two price increases, one in 2007 and another in 2011, it said.
At the time of the price-fixing arrangement, Canada Bread was under the ownership of Maple Leaf Foods.
Grupo Bimbo said itB次元官网网址檚 considering B次元官网网址渁ll legal options against those responsible.B次元官网网址�
Maple Leaf Foods did not immediately respond to a request for comment.
B次元官网网址淯nder new ownership, Canada Bread is committed to being a responsible partner to our valued customers and making bread an accessible and reliable food source for Canadians,B次元官网网址� Canada Bread vice-president Alice Lee said in a statement.
B次元官网网址淲e are pleased to have resolved this matter, and we look forward to building upon our investments in Canada.B次元官网网址�
Food industry expert Sylvain Charlebois pointed out that it took an international company to step up and acknowledge the wrongdoing in CanadaB次元官网网址檚 food industry.
B次元官网网址淭he paradox in all of this is we needed a Mexican company to clean the Canadian food industry up,B次元官网网址� said Charlebois, a professor of food distribution and policy at Dalhousie University. B次元官网网址淣obody in Canada wants to admit guilt.B次元官网网址�
He added: B次元官网网址淭he investigation is not over. More questions are going to be asked and Canadians will want more answers.B次元官网网址�
The Competition Bureau began investigating alleged anti-competitive agreements between competitors to fix either the price of fresh commercial bread in January 2016.
The investigation became public in 2017 when the first search warrants were executed.
Weston Foods and Loblaw Cos. Ltd., both subsidiaries of George Weston Ltd. at the time, had previously admitted their participation in an B次元官网网址渋ndustry-wide price-fixing arrangementB次元官网网址� involving the co-ordination of retail and wholesale bread prices.
In exchange for their co-operation, the companies received immunity from prosecution.
The Competition Bureau alleged in court documents in 2018 that at least $1.50 was artificially baked into the price of a loaf of bread during the 16-year bread-price-fixing conspiracy involving the countryB次元官网网址檚 largest bakery wholesalers and grocery retailers.
Experts say the scandal has given Canadians good reason to be skeptical about the cause of high food prices in recent months, especially as grocers post significant profits.
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