Ah, price-fixing schemes – not just for Canada’s telecommunications companies.
Brampton-based Loblaw, the beloved grocery store chain with over 2000 locations boasting $45 billion in revenue, has admitted to price-fixing over a 14-year period.
An investigation by the Competition Bureau revealed an industry-wide price-fixing arrangement by participants that included Loblaw and the Weston Bakeries division of George Weston, as well as other major grocery retailers and another bread wholesaler.
Those in on the scheme coordinated retail and wholesale prices of bread over a period extending from late 2001 to March 2015. This, of course, is illegal. Penalties for price-fixing range from fines up to $25 million to imprisonment to a maximum term of 14 years.
Loblaw has decided to respond to the accusations by offering a much more costly apology: $25 gift cards for pretty much anyone who wants one. The company estimates it will lose between $75 million and $150 million dollars as consumers cash in on the gesture. It’s highly unlikely anyone will see prison time over the charge.
“This sort of behaviour is wrong and has no place in our business or Canada’s grocery industry,” said Galen G. Weston, Chairman and Chief Executive Officer of Loblaw and Weston Bakeries. “This should never have happened.”
Metro, Sobeys and Canada Bread are the other major players in the game and have said they are cooperating with the investigation. Legal proceedings will be forthcoming as class action lawsuits have commenced against the parties involved, though their outcome is hard to predict. In all likeliness, nothing of significant harm to the companies will come of it. Loblaw has followed up its promise to not do it again with the standard “enhancement of compliance programs.”
Now, for the most important part: how to claim your $25 Loblaw gift card. Simply visit LoblawCard.ca, enter your email address, and you’ll be notified when registration for the gift card opens. All indications suggest everyone who registers will be eligible to receive a card.