There’s a deepening need in Canada to increase oversight into competition in our economy, as evidenced by the latest food-related scandal.
Canada Bread, an arm of the Mexican multinational Groupo Bimbo, just agreed to pay a $50-million settlement for its part in a bread price-fixing scheme.
It was a conspiracy that ran for 14 to 16 years, according to legal filings around the case, and involved major Canadian bread producers and some of the country’s leading grocers.
Read Also
Calling all farmers: What do you want us to ask at the Ag in Motion farm show?
Ag in Motion is back July 15-17, 2025; we want to know the production questions you need our reporters to ask
That it could run so long undetected — and only came to light due to the actions of whistleblowers inside these firms — speaks volumes to the ineffectual rubber-stamp nature of Canada’s competition law. It’s a long-standing and well-documented inadequacy.
The end result has been less choice, higher costs and fewer overall options for Canadian citizens.
It’s also meant that economic players in key sectors have tried to capture value chains from front to back, ensuring higher profits for them and higher costs for everyone else.
Grocers and telecom firms are the poster children for these issues, but the agriculture sector (at least at the farm level) should probably advocate for new teeth in competition regulations too.
Here in Western Canada, farmers are captive to just two railways, initially built using an ocean of public money, to haul their crops to port position.
A truly competitive solution would be to open these rail networks to other operators under a ‘running rights’ system. Essentially the rails would become akin to toll roads and ownership and operation would be separated.
But as things sit, that will never happen. The railways are currently pitching a fit over the milder extended interswitching proposal that’s currently being discussed. To hear them tell it, this will be just a short step to dysfunction, disaster and economic ruin.
The nation’s grain handling firms will certainly argue the railways need more regulatory oversight and a healthy dose of competition. However, they’re notably silent on their own aversion to competition.
A few years ago, I interviewed an Australian academic who had examined how the loss of marketing monopoly powers affected competition in that nation’s grain handling system. Australia pulled the pin on the single desk in 2008, four years before Canada did, providing a curious reporter with a handy real-life case study.
The academic assured me that it had little effect because there was plenty of competition in the system, and that if there wasn’t enough, more could always be added. But then he mentioned how access to port facilities was guaranteed by law.
I countered that, while there were a few small independent port terminal elevators here in Canada, most were owned and wholly controlled by the same firms buying the grain in the country. Those firms had no legal requirement to handle grain for another commercial player and a negative economic incentive — they’d lose the handling fees in the country.
Perplexed, he paused for a moment, and then asked the obvious question: “But … where’s your competition law?”
That’s a question for the ages, because Canada’s competition laws are woefully inadequate. Not fit for purpose, as the British would say.
In many ways it seems like competition is largely ignored in Canada to protect what are colloquially known as “unicorns”, Canadian-owned firms that, as the argument goes, help protect Canada’s economy.
But it appears these favoured firms quickly extract everything they can from this cozy situation, lining shareholder and executive pockets in the process.
Academic Vass Bedner, a professor at McMaster University, wrote of this last year in the publication Policy Options.
“Historically, Canada has justified a system that favours concentration, scale and alleged efficiencies over consumers and small businesses by gesturing at our vast geography and modest population,” she wrote.
“Sculpting a modern, ‘made-in-Canada’ approach to competition will defy the characteristic that competition law holds in highest regard – efficiency. Instead, it will be complex, occasionally cumbersome, and definitely passionate. Most of all, it will be worth it.”
The success of Canada’s economy doesn’t truly rely on a few favoured firms that are able to capture regulators and curry favour with politicians. It’s built from the ground up by small and medium-sized businesses.
Providing these entrepreneurs with a competitive environment where larger firms aren’t allowed to extract excessive costs from them is vital to their success.
Canada’s farmers — and farm organizations — must continue contributing to this discussion. After all, they’re the original small business owners.
