Canadian grocer Empire Company Limited, the parent company of Sobeys, has unveiled a new strategy to address competition in the areas surrounding their stores. The company will be altering the utilization of “property controls,” which are legal agreements that have historically restricted competitors from establishing stores in specific locations. Critics argue that these controls can stifle competition and lead to increased travel distances for consumers seeking affordable groceries.
Empire acknowledged the heightened scrutiny surrounding property controls and emphasized the importance of their appropriate use. The Competition Bureau of Canada has been investigating the use of these controls since 2024, although no conclusions of misconduct have been drawn. In 2023, the bureau recommended that provinces and territories consider limiting or prohibiting property controls within the grocery industry, a move that Manitoba has already implemented in June 2025.
Jenna Khoury-Hanna, an associate lawyer at Kinch Eddie Litigation, expressed optimism about the potential opportunities arising from Empire’s announcement, particularly in terms of enabling other businesses to occupy locations previously restricted by property controls. Empire has committed to refraining from establishing new restrictive covenants and enforcing any existing ones, including those on previously sold properties. The company is also revising its approach to exclusivity clauses, which are typically included in long-term leases to restrict nearby stores from selling specific products carried by major grocers.
Empire’s decision aligns with similar moves by Walmart Canada and the parent company of Loblaws, both of which have also announced plans to move away from property controls. While the impact of these changes on the Canadian grocery market remains uncertain, experts like Jamie Baxter, an associate professor at Dalhousie’s law school, emphasize the need for greater transparency around property controls to ensure fair competition and consumer benefit. Agricultural economist Pascal Thériault suggests that the effects of these changes may vary depending on the location, with smaller communities potentially benefiting more than larger urban areas.
The Competition Bureau has highlighted the potential link between limited competition and higher grocery prices but has not provided clear insights into how Empire’s shift will influence consumers. Moving forward, increased transparency and public awareness of property controls may play a crucial role in fostering a more competitive and consumer-friendly grocery market in Canada.
