The Competition Bureau discontinues its inquiry into the Quebec beer industry

OTTAWA, April 29, 2003 — After a detailed analysis of the Quebec beer market, the Competition Bureau has concluded that the practices of the Molson and Labatt breweries did not substantially lessen or prevent competition in the beer industry.

Several Quebec microbreweries had filed a complaint with the Bureau stating that they had suffered significant losses in product sales due to Labatt and Molson's business practices. Specifically, they criticized Molson and Labatt for exclusive dealing and for abusing their dominant position by engaging in various anti-competitive acts in the Quebec beer market.

The Bureau began its examination in August 2000, studying the complaint with respect to the civil provisions of the Competition Act, primarily those related to exclusive dealing and abuse of dominant position. To that end, the Bureau obtained information from the complainants and other industry players and then carried out a detailed analysis in conjunction with independent experts.

The evidence does not currently support making an application to the Competition Tribunal, because it does not confirm that the practices in question substantially harm competition. Nonetheless, the Bureau noted that the beer industry, in which two major breweries account for nearly 90% of sales and a number of clients are bound by potentially anti-competitive contract clauses, could still raise concerns with respect to the Competition Act. Therefore, as the market evolves, notably with regard to contracting practices and their long-term effects, the Bureau could decide to re-examine the industry and intervene, if necessary.

The Competition Bureau is an independent law enforcement agency that promotes and maintains fair competition so that all Canadians can benefit from competitive prices, product choice and quality service. It oversees the application of the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act.

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