Last week, the Ontario Superior Court, Canada Bread Company Limited (CBCL) was sentenced to fines totaling $50 million after the company pleaded guilty to four counts of fixing prices contrary to section 45 of the Competition Act.
The Public Prosecution Service of Canada (PPSC) and CBCL’s lawyers made joint submissions in favour of the total fine, payable in full within 30 days, which the Court endorsed and determined to be a just and appropriate sentence in the circumstances.
Settlement comes on first appearance after lengthy negotiations between the parties under the Competition Bureau’s (Bureau) Leniency Program and after the Bureau recommended that the PPSC grant leniency to CBCL, which has been under new ownership since May 2014. CBCL cooperated with the investigation upon learning of the allegations in 2017.
In an Agreed Statement of Facts filed with the Court, CBCL admitted that they entered into arrangements with Weston Foods (Canada) Inc. and others to increase wholesale Fresh Commercial Bread prices on four occasions, resulting in two price increases in October 2007 and March 2011.
The fine represents the maximum applicable under the law, i.e. $10 million each for counts 1 and 2 (before March 2010) and $25 million each for counts 3 and 4 (after March 2010), for a total of $70 million, less a leniency rebate of approximately 30% accepted by the PPSC for the collaboration and guilty plea of CBCL.
This case stems from a lengthy Bureau investigation targeting two of Canada’s largest fresh commercial bread suppliers, namely CBCL and its main competitor Weston Foods (Canada) Inc., as well as a significant number of major retailers.
In cases as complex as this, settlement discussions play a vital role in the criminal justice system, more specifically within the framework of the Bureau’s Leniency Program. The parties have demonstrated a serious and sustained commitment to reach a just settlement.
The Public Prosecution Service of Canada is a national organization responsible for prosecuting offences under federal jurisdiction in a manner that is free of any improper influence and that respects the public interest. The PPSC is also responsible for providing prosecution-related advice to law enforcement agencies across Canada.
Information on resolution discussions and how they work can be found in the publicly available PPSC Deskbook: https://www.ppsc-sppc.gc.ca/eng/pub/fpsd-sfpg/fps-sfp/tpd/p3/ch07.html