In a time when Canadians are feeling the pinch of rising prices and shrinking options, it’s heartening to see the Competition Bureau finally calling out a quiet but powerful force that has long stifled retail competition—restrictive property controls.
These legal clauses, buried in commercial leases or real estate deals, can dictate what kind of business is allowed to operate in a space. In practice, they’ve been used by powerful retailers to keep competitors out of malls, plazas, and even entire neighbourhoods. It’s a tactic that may not always violate the letter of the Competition Act, but it certainly goes against the spirit of a fair and open marketplace.
The Bureau’s new guidance—encouraging retailers and landlords to abandon or justify such controls—is a necessary step toward leveling the playing field. And frankly, it’s long overdue.
Let’s be clear: not all property controls are inherently bad. In some cases, they can serve a legitimate purpose, like maintaining a balanced tenant mix in a shopping center. But too often, they are wielded as tools of exclusion—blocking new entrants, discouraging innovation, and ultimately hurting the very people the market is supposed to serve: consumers.
The Bureau’s own grocery market study last year laid bare how serious the impact can be. It found that property controls helped limit competition from new grocery stores, denying communities the benefits of lower prices and more choices. When a single company can legally prevent a rival from setting up shop—even after they’ve moved out—it’s no longer a matter of smart business. It’s market manipulation.
The recent case involving Empire Co. Ltd. is a telling example. By agreeing to remove a restrictive covenant in Crowsnest Pass, Alberta, Empire opened the door for new grocers to enter the market. It’s a small victory, but it underscores the broader potential of removing unjustified property barriers.
What’s most concerning are restrictive covenants that bind the land itself, limiting not just current tenants but future ones as well. These are the regulatory zombies of the commercial world—clauses that live on for decades, long after the original players have moved on, continuing to choke off competition from beyond the grave.
The Bureau rightly says these kinds of controls should only be used in “exceptional circumstances.” That should be the norm moving forward: if a landlord or retailer wants to restrict competition, they need a very good reason—and the burden should be on them to prove it.
Retail competition drives innovation. It keeps prices in check. It improves service. And in communities across Canada, it can mean the difference between having a vibrant main street and a commercial dead zone.
Let’s hope landlords and retailers take the Bureau’s message seriously. Because a truly competitive market isn’t just good for business—it’s good for all of us.
