A major bread maker in Canada will pay C$50m ($38m; £30m) for its role in a price-fixing scheme – the highest such fine ever imposed by a Canadian court.
Canada Bread pleaded guilty on Wednesday to four counts of price-fixing dating from the mid-2000s.
The plea is part of a years-long investigation by a federal competition watchdog.
The Competition Bureau called the fine a “significant milestone” in its ongoing investigation.
“Fixing the price of bread ꟷ a food staple of Canadian households ꟷ was a serious criminal offence,” said Matthew Boswell with the Competition Bureau in a statement.
“We are doing everything in our power to pursue those who engage in price fixing.”
In court documents filed in the Ontario Superior Court, Canada Bread admitted that it arranged with its competitor, Weston Foods, to raise prices for bread products, like sandwich bread, hot dog buns and rolls.
The price fixing resulted in two price increases for fresh bread and baked goods, one in 2007 and another in 2011.
Canada Bread – a major bread and bakery producer and distributor – is now owned by Mexican firm Grupo Bimbo but was previously under the control of Maple Leaf Foods.
In a statement, Grupo Bimbo said it was unaware of any price fixing when it acquired the company in 2014 and remained unaware until search warrants arrived in 2017.
“Under new ownership, Canada Bread is committed to being a responsible partner to our valued customers and making bread an accessible and reliable food source for Canadians,” the company’s vice-president, Alice Lee, said in a statement.
The senior leadership at Canada Bread responsible for the price fixing is no longer employed by the company, the Competition Bureau said.
In a statement, Maple Leaf Foods said it was unaware of any wrongdoing by Canada Bread or its senior leadership during the time it was a shareholder.
“We are not aware of and have never engaged in inappropriate or anticompetitive activity, and we will defend ourselves vigorously against any allegation to the contrary.”
The investigation into bread price-fixing “remains a top priority”, the Competition Bureau said.
It has previously suggested that about C$1.50 was added to the price of bread over the course of the alleged scheme – believed to have lasted some 16 years.
In December 2017, Weston Foods and Loblaw Companies Limited “announced their participation in what they described as an ‘industry-wide price-fixing arrangement’ involving the coordination of retail and wholesale bread prices”, the watchdog said.
The two firms received immunity from prosecution for their cooperation.
A number of other major grocery companies operating in the country are still under investigation. None have admitted any involvement.
Separately, the Competition Bureau is expected to complete an investigation into the country’s grocery sector competition this month. That probe was launched last year amid rising food prices, which grocery owners have linked to inflation.
BBC/Simeon Ugbodovon
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