Empire to Stop New Restrictive Covenants on Grocery Properties, No Wrongdoing Found

Empire Company Limited announced Tuesday that it will stop creating new restrictive covenants tied to its Sobeys grocery stores and will not enforce any existing covenants, including on properties already sold. Cbc reported that the company is also limiting its use of exclusivity clauses in long-term leases.

Empire stated that such arrangements are not inherently anti-competitive yet recognized the need to ensure appropriate use amid heightened scrutiny.

The Competition Bureau of Canada has investigated property controls since 2024 and has sought court orders compelling Empire to supply documents and testimony. The bureau has reached no conclusions of wrongdoing. The bureau recommended in 2023 that provinces and territories limit or ban property controls in the grocery sector.

Manitoba implemented such limits in June 2025. Cbc reported that the bureau examined the Halifax Regional Municipality, where former Dalhousie law student Jenna Khoury-Hanna identified covenants on old Sobeys locations including Gottingen Street in downtown Halifax and the Woodside neighbourhood in Dartmouth.

Khoury-Hanna, now an associate lawyer, described the announcement as a step in the right direction and said she was excited about potential new businesses at those sites.

Dalhousie law professor Jamie Baxter welcomed Empire's commitment but noted the lack of public transparency around enforcement of property controls. Agricultural economist Pascal Thériault at McGill University said effects could be more noticeable in smaller communities than in large urban areas.