Empire Company will no longer enforce grocery-related property controls, including restrictive clauses, the firm announced Tuesday.

Stellarton, N.S.-based Empire said the move is part of a long-term commitment to support a competitive and accessible grocery market in Canada. The decision comes after Empire and Loblaw faced increasing pressure from the Competition Bureau to end restrictive covenants and exclusivity clauses which prevent landlords from placing firms’ competitors in the same retail centres.

The restrictions are often found in mall leases or tied to a property after a tenant vacates.

In June 2025, the Bureau called on retailers and landlords to drop or revise property controls in commercial leases that cannot be justified, even if they do not violate the Competition Act.

Empire said property controls, including restrictive covenants and exclusivity clauses, are commonly used across many industries to support investment, enable market entry and sustain developments, particularly in underserved communities. While such arrangements are not inherently anti-competitive, Empire said it recognizes the increased scrutiny surrounding their use and has worked with the Competition Bureau and other stakeholders to refine its practices.

Empire said it will no longer enforce restrictive covenant interests on any properties, including those previously sold, and will not register new restrictive covenants. The commitment also covers restrictive covenants previously registered in Manitoba under Bill 31.

The company also said it will not enforce exclusivity clauses on properties identified in the Competition Bureau’s June 2026 order or clauses re-registered in Manitoba following Bill 31. It will stop using or enforcing radius clauses, which restrict competing grocery stores from opening nearby, and will not use exclusivity clauses against specialty food retailers, such as butchers and bakeries, that sell only a limited range of grocery products.

Empire said it will continue reviewing requests to waive or remove property controls, limit the geographic scope, product coverage and duration of exclusivity provisions in future grocery leases across Canada, and regularly review existing agreements where one of its banners is the only grocery store in a community. The company also called on other grocery retailers to adopt similar principles and said it will continue working with the Competition Bureau and governments on a consistent legislative and regulatory framework for property controls.

Empire said customers remain at the centre of its strategy and that it is committed to ensuring Canadians continue to benefit from choice, value and access.

The Bureau issued new guidance in June 2025 while calling on retailers to drop or revise property controls in commercial leases that cannot be justified, even if they do not violate the Competition Act,

In newly issued guidance, the federal agency advised that such controls—like clauses limiting what kinds of stores can operate in a location—should only be used when they promote competition. And even then, they should only be used in exceptional cases.

“The widespread use of competitor property controls can make it more difficult for firms to enter new markets or expand, reducing the choices available to Canadians,” stated the Bureau in the new guidelines.

The new guidelines followed the Bureau’s 2023 grocery-market study and an agreement with Empire Company, the parent of Sobeys and other leading supermarket chains, to eliminate a clause restricting grocery competition in Crowsnest Pass, Alta.

Photo: Empire Company