TORONTO, Dec. 10, 2014 – Restaurants Canada has asked the Competition Bureau to launch an official investigation into a non-compete deal between the LCBO and the Beer Store. The deal, which had been kept under wraps until today, restricts competition and inflates the price of beer in restaurants, bars and pubs.
“We have known of the existence of an agreement for years, but we did not know the depth of the complicity. This agreement fixes prices, territories and products,” says James Rilett, Ontario Vice President for Restaurants Canada.
In the past, the Competition Bureau has not been willing to wade into the issue, but Restaurants Canada believes the deal, signed in 2000 and made public today, must be investigated.
“Ontarians need a neutral third party to look into this secretive agreement,” says Rilett. “The Ed Clark panel had the opportunity to call closing time on this sweetheart deal, but decided the economics of the Beer Store were more important than the rights of small businesses.”
Restaurants Canada is also calling on the government to immediately cancel this non-compete agreement.
“The agreement can be terminated at any point, simply by giving six months’ notice. If the government were to cancel it today, Ontario consumers would be able to have better service and cheaper prices by the summer.”
Restaurants Canada (formerly the Canadian Restaurant and Foodservices Association) is a national association comprising 30,000 businesses in every segment of the foodservice industry, including restaurants, bars, caterers, institutions and their suppliers. Canada’s restaurant industry directly employs more than 1.1 million Canadians, contributes $68 billion a year to the Canadian economy and serves more than 18 million customers every day.
NOTE: A copy of the Restaurants Canada Competition Bureau complaint is available here.