Canada Bread Co., operating as Bimbo Canada, has been added to the Canadian government’s list of ineligible and suspended suppliers due to its involvement in an industry-wide price-fixing scheme concerning certain packaged bread products. This decision follows the imposition of a C$50 million ($38 million) fine on the company two months ago, following its admission of guilt in the said price-fixing arrangement. Notably, this fine, levied by the Ontario Superior Court, stands as the highest price-fixing penalty ever imposed by a Canadian court.
As an ineligible and suspended supplier, Canada Bread is prohibited from being awarded any government contracts or real property agreements in Canada. The company has previously supplied products to government entities such as the Defense Department and Fisheries and Oceans Canada. This ban is expected to remain in effect until August 22, 2033.
Canada Bread now joins four other companies on the same list: Les Enterprises Chatel Inc., R.M. Belanger Ltd., Guaranteed Industries Ltd., and 3682021 Canada Inc. (Sports Max). Weston Foods and Loblaw Companies Ltd., both subsidiaries of George Weston Ltd., secured immunity from prosecution for their cooperation with the Competition Bureau’s investigation into the bread price-fixing scheme.
During the period of price-fixing, which spanned from late 2001 to March 2015, Canada Bread was under the ownership of Maple Leaf Foods. Grupo Bimbo SAB de CV acquired Canada Bread Co. from Maple Leaf in 2014. It’s worth noting that the senior leadership at Canada Bread involved in the price-fixing is no longer affiliated with the company.
Canada Bread pleaded guilty to four counts of price-fixing under the Competition Act, acknowledging its collaboration with competitor Weston Foods (Canada) Inc. to raise prices for various packaged and sliced bread products, including sandwich bread, hot dog buns, and rolls. This resulted in two price hikes, one in 2007 and another in 2011, as per the findings of Competition Bureau Canada.
Grupo Bimbo, commenting on the matter, emphasized that it was unaware of the conduct before acquiring Canada Bread in 2014 and only learned about it in 2017. Since then, Canada Bread has provided full cooperation with the Competition Bureau.
The Competition Bureau recommended leniency in sentencing for Canada Bread as part of its Leniency Program, and the fine represents the maximum allowed by law, with a reduction for cooperation and a guilty plea.
Matthew Boswell, Commissioner of Competition at the Competition Bureau, emphasized the gravity of price-fixing, especially concerning a staple like bread, and underscored the Bureau’s commitment to pursuing those engaged in such practices.
