Canada Bread Bakery, which sells the Bon Matin, Villagio, POM and Vachon brands, has just been fined the largest ever by the Canadian judiciary for price fixing.
The company has to pay $50 million after pleading guilty to wholesale bread price fixing.
The criminal agreement with competitor Weston Foods meant that prices for fresh wholesale bread such as sliced and boxed bread, sandwich and hot dog buns and small loaves rose.
Canada Bread Bakery pleaded guilty to four counts under the Competition Act in the Ontario Supreme Court. Price fixing led to two price increases in 2007 and 2011. The company was then owned by Maple Leaf Foods. It was sold to Grupo Bimbo in 2014 for US$1.8 billion. The Mexican company claims that it was only three years later that it was informed of the former executives’ reprehensible behavior.
“Pricing bread – a staple of many Canadian households – is a serious criminal offence. Continuing our investigation remains one of our top priorities. “We are doing everything in our power to prosecute those who engage in price fixing,” said Competition Commissioner Matthew Boswell.
“Grupo Bimbo is considering all possible legal avenues against those responsible for this behavior,” it said in a statement on Thursday.
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Supermarkets are also the subject of the study
The Competitions Bureau recommended that the Canadian Attorney General’s leniency in returning the verdict because the company fully cooperated with the Competitions Bureau’s investigation. The fine imposed corresponds to the maximum amount permitted by law minus a leniency credit.
Canada Bread’s conviction is part of an ongoing investigation. Not only did the producers work together to raise the price of bread, there are also accusations against the supermarkets, also of price fixing. Affected are Metro, Sobeys, Wal-Mart Canada, Giant Tiger and Maple Leaf Foods.
Weston and Loblaw, as well as Canada Bread, were granted immunity from prosecution in exchange for their cooperation in the Competition Bureau’s investigation.