Alleged anti-competitive conduct by Loblaw Companies Limited

Position Statement

See the news release that corresponds to this position statement.


OTTAWA, November 21, 2017 — The Commissioner of Competition (Commissioner) announced today that he has discontinued an inquiry into allegations that Loblaw Companies Limited (Loblaw) engaged in conduct contrary to the abuse of dominance provisions of the Competition Act (Act). The Commissioner's decision in this case follows an extensive three-year investigation conducted by the Competition Bureau (Bureau) into allegations that Loblaw implemented and enforced a number of anti-competitive policies against its suppliers.

This position statement is intended to serve two purposes. First, it provides a detailed summary of the Bureau's investigation and identifies the basis upon which the inquiry has been discontinued. Second, it provides guidance on key competition law issues relevant to the Canadian grocery industry, including the assessment of market power in buying markets, the distinction between hard bargaining and anti-competitive conduct and the sharing of risk between buyers and sellers.

I. Executive summary

Market context

In 2016, Canadians purchased over $81.5 billion of grocery products from supermarkets and other grocery stores. For the average Canadian household, this amounts to an annual expenditure of over $5,000. Vigorous competition in the grocery industry is essential to ensure that Canadian consumers benefit from low prices and increased innovation, choice, quality and service.

In the grocery sector, competition among retailers occurs at two levels: retail and wholesale. At the retail level, retailers compete to attract customers to their stores through a variety of strategies. Certain retailers, for instance, attract customers through weekly flyers that identify products that are on sale, while others may incent customers to shop at their stores through loyalty programs, offering new products or providing enhanced convenience.

At the wholesale level, retailers compete to obtain favourable trade terms, such as low wholesale costs, from their suppliers. While competition at the wholesale level may appear less significant than at the retail level, it is critically important to the commercial viability of all retailers. Retailers that obtain more favourable trade terms from their suppliers, such as low wholesale costs, have an enhanced ability to compete for customers at the retail level.

As a result, retailers often develop policies to enhance their competitiveness at both the retail and wholesale levels. In many cases, these strategies are pro-competitive, as they increase the retailer's ability to compete more vigorously in the market. Other strategies, however, may raise concerns under the Act. This is most likely where the strategies seek to decrease the degree of rivalry in the marketplace by, for instance, impeding rival firms' ability to compete (for instance, by raising rival firms' costs) or, alternatively, suppressing rival firms' incentives to compete.

Investigation background

These considerations informed the Bureau's decision in March 2014 to initiate an inquiry to assess whether certain policies enforced by Loblaw, Canada's largest grocer, against its suppliers were contrary to the abuse of dominance provisions of the Act. This inquiry immediately followed the Bureau's review of Loblaw's acquisition of Shoppers Drug Mart Corporation, during which the Bureau uncovered evidence that certain of these policies may have been implemented for an anti-competitive purpose.Footnote 1

Loblaw is Canada's largest grocery and pharmacy retailer with around 2,400 corporate, franchised and associate-owned locations throughout Canada. It operates retail locations under a number of banners, including Loblaws, Real Canadian Superstore, No Frills, Fortinos, Your Independent Grocer, Provigo and Maxi.

The Bureau's inquiry focused on nine policies implemented and enforced by Loblaw (Loblaw Policies)Footnote 2 pursuant to which Loblaw sought compensation from its suppliers when its profitability was negatively impacted by the competitive activity of other retailers.

Specifically, pursuant to the Loblaw Policies, Loblaw frequently requested or obtained compensation from its suppliers when:

  1. another retailer's price for one of the supplier's products was lower than or equivalent to Loblaw's price;
  2. it determined that another retailer's wholesale cost for a product was lower than its wholesale cost;
  3. it was not offered a product or format that was offered to another retailer; or
  4. its margin or profitability on one or more of a supplier's products fell below a specified threshold.

Most of the Loblaw Policies were formally discontinued by Loblaw effective January 2016, during the Bureau's investigation. The Bureau, nevertheless, elected to continue its inquiry in order to determine:

  1. whether Loblaw had, in fact, ceased enforcing the various Loblaw Policies it claimed to have discontinued; and
  2. whether the Loblaw Policies, including those that were formally discontinued, were contrary to the abuse of dominance provisions of the Act and, in particular, to assess whether the Loblaw Policies had lessened or prevented competition substantially.Footnote 3

To properly test these allegations, the Bureau completed a comprehensive investigation, during which the Bureau collected information from Loblaw and other relevant market participants, including many of Loblaw's suppliers, other retailers operating in Canada, industry associations, foreign competition authorities and industry experts. Given the complex nature of the commercial relationships at play, the Bureau used formal investigative powers under section 11 of the Act to compel a number of parties to provide information through the production of documents, data and sworn testimony.

The Bureau's detailed review in this matter reflects the importance of the grocery sector to Canadian consumers and the need for clarity regarding the application of the Act in this area of the economy.

Summary of Bureau conclusions

The Bureau's investigation centered on a concern that the Loblaw Policies may have caused suppliers to implement various strategies, which would impact rivalry among retailers, in order to minimize the potential financial impact of the Loblaw Policies. Specifically, the Bureau considered whether the Loblaw Policies caused suppliers to provide less favourable trade terms to other retailers, or to otherwise impede the competitive process by suppressing competition among certain retailers.

While a number of Loblaw's suppliers suggested that the Loblaw Policies had caused them to engage in the types of strategies described above, the Bureau concluded that these allegations were not sufficiently supported by the full body of evidence collected. For this reason, the Bureau has determined that there is insufficient evidence to conclude that the Loblaw Policies have lessened or prevented competition substantially in any relevant market. It is on this basis that the Commissioner elected to discontinue the inquiry.

II. The Bureau's investigation

The Loblaw Policies

The Bureau's investigation assessed the competitive impact of nine policies implemented and enforced, to varying degrees, by Loblaw. These policies, other than Margin Shielding, were communicated by Loblaw to its suppliers through written policy documents, which were distributed annually.

While these policies differed significantly in their scope (e.g., Western Canada versus Eastern Canada) and terms, they shared a unifying feature: Loblaw sought retroactive compensation from suppliers, often without their prior agreement, and sometimes in the face of explicit disagreement, when its profitability was negatively impacted by the competitive activity of other retailers.

The various Loblaw Policies were triggered by three categories of competitive activity:

  • Price competition: many of the Loblaw Policies were triggered when Loblaw faced retail price competition from another retailer. For instance, pursuant to Loblaw's Active Ad Match Policy, suppliers were subject to deductionsFootnote 4 when Loblaw automatically adjusted its retail price for the supplier's product to match the advertised price offered by another retailer for that product. Deductions imposed pursuant to this policy were generally determined as follows:
    1. Loblaw calculated the difference between its retail price and the other retailer's advertised price; and
    2. Loblaw multiplied this amount by the number of units it sold at its adjusted price.Footnote 5
  • Non-price competition: another policy implemented and enforced by Loblaw was triggered when it faced non-price competition from another retailer. Pursuant to the Product Introduction Policy, Loblaw sought compensation or imposed deductions if, among other things, a supplier offered a product to another retailer without offering, or without first offering, the product to Loblaw.
  • Margin Shielding:Footnote 6 pursuant to a final policy, Margin Shielding, Loblaw sought compensation from its suppliers when its margin or profitability on the sale of one or more products fell below a specified threshold.Footnote 7 Loblaw's margin or profitability in a given period is invariably impacted by many factors, including competition from other retailers. In this sense, Margin Shielding mixes the features of the policies described above, as it may be triggered by retail price or non-price competition. Margin Shielding, however, differs from the other Loblaw Policies, in that it may also be triggered by factors other than competition from other retailers, such as reduced market demand for a supplier's products or independent decisions by Loblaw to offer a supplier's products at a reduced margin.

Broadly speaking, the Bureau's investigation centered on a concern that the Loblaw Policies may have incentivized suppliers to disadvantage other retailers, and to otherwise engage in conduct that would impede the competitive process by suppressing competition among certain retailers. In the section that follows, we describe in more detail why these policies were potentially of concern under the abuse of dominance provisions.

Focus of the inquiry

Under the Act, abuse of dominance occurs when

  1. a dominant firm or group of firms in a market,
  2. engages in a practice of anti-competitive acts,
  3. with the result that competition has been or is likely to be lessened or prevented substantially.

While the Bureau uncovered evidence of market power, and determined that Loblaw may have introduced some of the Loblaw Policies for an anti-competitive purpose, the analysis in this case ultimately focused on whether the Loblaw Policies had lessened or prevented competition substantially.

The Bureau assessed the competitive impact of the Loblaw Policies pursuant to two separate theories of harm:

  1. raising rivals' costs; and
  2. reduced rivalry as a result of facilitating conduct.

Raising rivals' costs

A raising rivals' costs theory suggests that alleged anti-competitive conduct may negatively impact competition where it raises competitors' costs of operation, thereby impeding their ability to compete. In the context of this case, the raising rivals' costs theory considered whether suppliers would have provided more favourable trade terms to other retailers in the absence of the Loblaw Policies. To assess this theory, the Bureau considered whether there was evidence that the Loblaw Policies caused suppliers to:

  • increase the price charged to other retailers for the supplier's products;
  • transfer, redistribute or otherwise allocate trade spend (i.e., compensation provided to a retailer to reduce the retailer's cost of goods sold) to Loblaw at the expense of other retailers;
  • refuse to offer, or offer reduced, promotional or coupon support (i.e., funding provided to a retailer to offer consumers a reduced price on a supplier's products) to other retailers;
  • refuse to offer new, innovative products and formats to retailers other than Loblaw; or
  • remove existing products and formats from retailers other than Loblaw.

Reduced rivalry as a result of facilitating conduct

The second theory considered by the Bureau suggests that anti-competitive conduct may negatively impact competition where it suppresses firms' incentives to vigorously compete, resulting in reduced rivalry. Applied to this case, this theory considered whether suppliers, in response to the Loblaw Policies, engaged in conduct that decreased the incentive of their retail customers to compete with one another. To assess this theory, the Bureau considered whether there was evidence that the Loblaw Policies caused suppliers to:

  • introduce vertical pricing restrictions, such as minimum advertised pricing policies (MAPs), in order to limit the ability of other retailers to offer products below the price offered by Loblaw;
  • pressure or encourage retailers to respect and follow suggested retail price lists (i.e., manufacturer suggested retail prices (MSRPs)); or
  • urge retailers other than Loblaw to raise their advertised or shelf price for the supplier's products.

Information collected

To assess the competitive impact of the Loblaw Policies, the Bureau collected a wide range of information, including records and data, from many sources, including:

  • Loblaw: the Bureau obtained information from Loblaw and its parent company, George Weston Limited, pursuant to a court order. This order primarily sought information that would assist the Bureau in assessing the intent of the Loblaw Policies, and any potential impact of these policies on competition in the market.
  • Suppliers: through interviews, voluntary requests for information and court orders, the Bureau collected information from approximately 60 suppliers. These suppliers produce a variety of products, including both nationally branded products and products sold by retailers under their own brand names (Private Label), across key product categories other than fresh produce and bakery.
  • Retailers: the Bureau also collected information from a diverse group of retailers, including traditional grocery retailers, mass merchandisers and discount stores. Certain of these retailers operate stores throughout Canada, while others operate in particular regions of Canada.
  • Industry associations: throughout the investigation, the Bureau consulted with a number of industry associations representing participants in the grocery industry.
  • Competition authorities: the Bureau's review also benefitted from contact with a number of foreign competition authorities with experience assessing the impact of conduct similar to the Loblaw Policies.

Loblaw ceases certain of the Loblaw Policies and introduces a new purchasing model with its suppliers

During the Bureau's investigation, Loblaw communicated to its suppliers that it would cease enforcing most of the Loblaw Policies effective January 2016. The policies discontinued included all policies other than the Product Introduction Policy and Margin Shielding. At the time of its announcement, Loblaw did not indicate whether it would continue to seek compensation from its suppliers pursuant to Margin Shielding or its Product Introduction Policy.

Upon discontinuing certain of the Loblaw Policies, Loblaw introduced a new purchasing model with its suppliers. This model, which Loblaw refers to as Enterprise Costing, was meant to simplify the relationship between Loblaw and its suppliers, including by establishing one national price for each product purchased from a supplier. As part of Enterprise Costing, Loblaw sought to incorporate into its new pricing structure amounts it had previously collected pursuant to the discontinued policies. However, importantly, and unlike the Loblaw Policies, these funds would automatically accrue to Loblaw when it purchased products from a supplier, and were not tied to competitive activity in the marketplace.

Based on a review of the evidence, the Bureau concluded that the introduction of Enterprise Costing does not warrant scrutiny under the abuse of dominance provisions as it represents a mere exercise of bargaining power, which does not, on its own, raise concerns under those provisions.

Key findings from the Bureau's inquiry into the Loblaw Policies

The Bureau has reached two conclusions in the context of this inquiry.

First, the Bureau's review has confirmed that Loblaw no longer enforces the policies it committed to discontinue effective January 2016. These policies included the Active Ad Match Policy, Passive Ad Match Policy, Ad Collision Policy, Bulk Pack Billing Policy, Coupon Match Policy, Cost Increase Policy and Threshold Deals. The Bureau's review also suggests Loblaw has not been enforcing Margin Shielding or its Product Introduction Policy with any frequency.

Second, the Bureau has concluded that, on balance, there is insufficient evidence to conclude that the Loblaw Policies have lessened or prevented competition substantially. Decisions by the Bureau must be informed by the evidence it collects from relevant market participants. In this case, evidence provided by market participants did not sufficiently support either of the Bureau's theories of harm. While a number of suppliers suggested that the Loblaw Policies may have caused them to disadvantage other retailers or suppress competition among certain retailers, these allegations were not sufficiently supported by the full body of evidence collected. For this reason, the Commissioner has elected to discontinue this inquiry.

III. Guidance to the industry

The Bureau's investigation of the Loblaw Policies raised many important competition law issues of relevance to market participants in the Canadian grocery industry. Three of these issues are highlighted below.

a. Assessing market power in buying markets

Most abuse of dominance cases considered by competition authorities involve assessing market power in a downstream market for the sale of a product. In this case, though, the Bureau's assessment of market power principally focused on an upstream market where grocery retailers, like Loblaw, purchase products from their suppliers.

While many factors are relevant to assessing market power in downstream markets, significant weight is often placed on a firm's market share. This is reflected in the Bureau's Enforcement Guidelines on the Abuse of Dominance Provisions, which state that "high market share is usually a necessary, but not sufficient, condition to establish market power". For this reason, the Bureau has taken the position that "a market share under 35 percent will generally not prompt further examination".

The Bureau's review in this case, however, suggests that market share may be a less informative indicator of market power, and accordingly should be afforded less weight, in cases involving upstream buying markets in the grocery sector. Instead, an analysis of market power in upstream buying markets should aim to determine whether particular features of the relevant market enable large purchasers to exercise control over their suppliers.

Features relevant to this assessment in this case included:

  • Limited existing or potential alternatives: suppliers in Canada have relatively few channels for the distribution of their products. Moreover, most suppliers in Canada already sell a significant volume of product through these existing distribution channels. As a result, it would be difficult, if not impossible, for most suppliers to overcome the loss of their largest customer in Canada, as they would not be able to meaningfully offset the loss in volume by increasing sales to existing or potential customers.
  • Relative impact on revenue: Canadian grocery retailers typically purchase products from hundreds, if not thousands, of individual suppliers. Purchases from an individual supplier, therefore, generally do not account for a significant percentage of a retailer's total purchases. Consequently, a supplier is likely to lose a greater percentage of revenue than its largest customer if the parties cease doing business.
  • Private Label competition: many Canadian grocery retailers have developed strong portfolios of Private Label products, which often compete directly with suppliers' national brands across a number of product categories (e.g., Loblaw offers Private Label products under brands such as "President's Choice" and "no name", while Sobeys and Metro offer Private Label products under brands such as "Compliments" and "Selection", respectively). Retailers can create leverage in negotiations with suppliers by threatening to favour their own Private Label products over the supplier's products absent the supplier's agreement to revised terms of trade.

These factors help to explain a key theme that emerged from this investigation: many suppliers, including large multinational corporations, felt their largest customer was able to exercise a significant degree of control over their business in Canada, even though that customer, in many cases, did not necessarily account for more than 35% of the supplier's sales in Canada.

In future cases involving upstream buying markets in the grocery sector, the Bureau will place significant weight on the unique facts of each case, and is unlikely to conclude a firm does not have market power simply because its market share falls below the Bureau's safe harbour thresholds.

b. The line between hard bargaining and anti-competitive conduct

Abuse of dominance investigations raise a number of challenges for competition law enforcers. While these challenges differ from case to case, competition enforcers frequently struggle to answer a central question: is the alleged conduct anti-competitive or simply indicative of vigorous competition?

This question is particularly difficult where the alleged anti-competitive conduct involves aggressive bargaining by a large customer with its suppliers. In this type of case, competition authorities must assess whether the alleged conduct of the large customer crosses the line from hard bargaining, which is permissible, to anti-competitive conduct.

The Bureau recognizes hard bargaining by a large customer may often be pro-competitive, resulting in benefits for downstream participants, including lower prices for consumers. For example, when grocers develop strong Private Labels they increase their bargaining position with suppliers. Nevertheless, such innovation can deliver substantial value to consumers.

In order to determine whether conduct is properly characterized as anti-competitive, the Bureau will be guided by an assessment of the overall intent of the conduct. The Bureau will assess overall intent by reference to both evidence of subjective intent and the reasonably foreseeable consequences of the conduct. A conclusion that conduct by a large buyer is anti-competitive is more likely where the Bureau determines that the overall intent of the conduct is to either harm the competitiveness of another firm or firms, or to harm the competitive process. Such a conclusion may be warranted if, for instance, the alleged conduct of the large customer incentivizes suppliers to disadvantage other customers, or to engage in conduct that decreases the incentive of their customers to compete with one another.

These types of incentives may arise as a result of conduct like the Loblaw Policies, which implicitly or explicitly hold suppliers financially liable for retail competition and, in so doing, may lead suppliers to change their behaviour toward other retailers in order to protect their own profitability.

These types of incentives are unlikely to arise, however, where a large customer requests or demands reduced prices from its suppliers for future purchases (for instance, through demands known in the industry as "COGS demands" or requests for additional "automatic O&A") or additional funds to promote a supplier's products. Nevertheless, many suppliers made submissions during the Bureau's investigation that this type of conduct was excessive and unjustified. While these submissions were considered by the Bureau, complaints regarding an imbalance of bargaining power do not, on their own, raise concerns under the abuse of dominance provisions of the Act.

In assessing whether conduct is anti-competitive, the Bureau's focus will remain squarely on whether the overall intent of the conduct is to either harm the competitiveness of another firm or firms, or to harm the competitive process.

c. Risk-sharing between suppliers and retailers: Margin Shielding

A retailer's margin on a product is the difference between the price it pays to purchase the product from a supplier and the price it is able to sell the product to consumers.

Retailers have a degree of control over the price they pay for a product, through their negotiations with suppliers. Retailers' ability to set retail price, however, is impacted by many factors, some of which are beyond their control.

Relevant factors, for instance, include the retail prices offered by other firms in the market and demand conditions for the relevant product. For instance, demand for a product could fall following the introduction of a new, substitutable product by a competitor or demand for a particular product could increase due to factors like seasonality. Ultimately, these and other factors influence the price consumers are willing to pay for a product. At the time a product is purchased from a supplier, therefore, retailers face a degree of uncertainty regarding the margins they are likely to earn upon the sale of the product.

The Bureau is aware that retailers may attempt to mitigate this uncertainty through various strategies. These strategies are intended to transfer some or all of the risk of retail competition from a retailer to its supplier. One way a retailer may attempt to achieve this transfer of risk is by introducing a scheme that requires its suppliers to compensate it when its margin decreases on the sale of the supplier's products. These types of practices, which are similar to Margin Shielding, may be of concern to the Bureau.

Specifically, this type of conduct by dominant firms may be of concern because it may, in certain circumstances, incentivize suppliers to disadvantage other retailers or engage in conduct that decreases retailers' incentives to vigorously compete. These incentives are most likely to materialize if the supplier can protect the retailer's margin by shielding it from competition from other retailers, for instance by decreasing the frequency or depth of promotions offered to other retailers, removing low margin products from other retailers or implementing MAPs.

Where there is compelling evidence that these incentives have materialized as a result of conduct similar to Margin Shielding, the Bureau will not hesitate to take appropriate action.

IV. Conclusion

As described above, the Commissioner has elected to discontinue his inquiry based on a review of the full body of evidence obtained during the course of the investigation, including following the discontinuance of many of the policies under investigation.

The Commissioner makes his enforcement decisions based on the available evidence. Should new and compelling evidence of harm come to light, the Bureau will not hesitate to take appropriate action.

The guidance provided in this position statement, including on topics such as the assessment of market power in buying markets, the distinction between hard bargaining and anti-competitive conduct and the sharing of risk between buyers and sellers, is intended to provide assistance to market participants on relevant competition law issues.

This publication is not a legal document. The Bureau’s findings, as reflected in this Position Statement, are not findings of fact or law that have been tested before a tribunal or court. Further, the contents of this Position Statement do not indicate findings of unlawful conduct by any party.

However, in an effort to further enhance its communication and transparency with stakeholders, the Bureau may publicly communicate the results of certain investigations, inquiries and merger reviews by way of a Position Statement. In the case of a merger review, Position Statements briefly describe the Bureau's analysis of a particular proposed transaction and summarize its main findings. The Bureau also publishes Position Statements summarizing the results of certain investigations, inquiries and reviews conducted under the Competition Act. Readers should exercise caution in interpreting the Bureau’s assessment. Enforcement decisions are made on a case‑by‑case basis and the conclusions discussed in the Position Statement are specific to the present matter and are not binding on the Commissioner of Competition.


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Appendix A –The Loblaw Policies

Active Ad Match Policy

Pursuant to this policy, suppliers were subject to deductions when Loblaw automatically adjusted its retail price for the supplier's product to match the advertised price offered by another retailer for that product.

The Active Ad Match Policy was applied and enforced in Western Canada, which includes certain parts of Northern Ontario, in relation to the following banners:

  1. Real Canadian Superstore;
  2. Extra Foods; and
  3. Real Canadian Wholesale Club.

Threshold Deals

Threshold Deals were complementary to Loblaw's Active Ad Match Policy, and were negotiated agreements between Loblaw and its suppliers.

Pursuant to Threshold Deals, suppliers were asked to compensate Loblaw when its margin on the sale of one or more products fell below a specified threshold when it matched the advertised price offered by another retailer.

Passive Ad Match Policy

Pursuant to the Passive Ad Match Policy, suppliers were subject to deductions when Loblaw reactively (i.e., in response to a consumer providing proof of a lower advertised price at another retailer) adjusted its retail price of a product to match the advertised price of another retailer for that product.

The Passive Ad Match Policy was applied and enforced in certain geographic regions in relation to the following banners:

  1. nationally at No Frills;
  2. in Ontario at Superstore East; and
  3. in Quebec at both Maxi and Maxi et cie.

Ad Collision Policy

Pursuant to the Ad Collision Policy, suppliers were subject to deductions when another retailer promoted a product in its flyer, within a week before or after the Loblaw promotion, at a price below or equal to the promotional price offered by Loblaw.

The Ad Collision Policy was applied and enforced across Canada in relation to all of Loblaw's banners.

Cost Increase Policy

Pursuant to the Cost Increase Policy, suppliers were subject to deductions when, following Loblaw's acceptance of a supplier's wholesale cost increase on one or more products, another retailer did not fully reflect the wholesale cost increase in its retail price of those products.

The Cost Increase Policy was applied and enforced across Canada in relation to all of Loblaw's banners.

Bulk Pack Billing Policy

Pursuant to the Bulk Pack Billing Policy, suppliers were subject to deductions when Loblaw concluded that another retailer was receiving a lower wholesale cost than Loblaw for a product on a per unit basis.

The Bulk Pack Billing Policy was applied and enforced across Canada in relation to all of Loblaw's banners.

Coupon Match

Pursuant to the Coupon Match Policy, suppliers were subject to deductions when a coupon promotion was offered to another retailer, but not to Loblaw.

The Coupon Match Policy was applied and enforced across Canada in relation to all of Loblaw's banners.

Product Introduction Policy

Pursuant to the Product Introduction Policy, Loblaw sought compensation or imposed deductions if, among other things, a supplier offered a product to another retailer without offering, or without first offering, the product to Loblaw.

The Product Introduction Policy was applied and enforced across Canada in relation to all of Loblaw's banners.

Margin Shielding

The Bureau recognizes that Margin Shielding was not a formal policy of Loblaw, but rather a pattern of conduct that was described to the Bureau by a number of Loblaw's suppliers. Margin Shielding, unlike the other policies identified above, was not expressly communicated to Loblaw's suppliers through policy documents.

Pursuant to Margin Shielding, Loblaw sought compensation from its suppliers when its margin or profitability on the sale of one or more products fell below a specified threshold.

Margin Shielding was applied and enforced against Loblaw's suppliers on an ad hoc basis.