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Township, Competition Bureau at odds over No Frills

Could Loblaw close its No Frills store on Arthur Street South, move to another location and continue to operate in Elmira?
That seems to be the case as Woolwich attempts to save the grocery store threatened by an order from the federal Competition Bureau, the victim of the agency’s approval of Loblaw’s acquisition of Shoppers Drug Mart.
Meeting this week, township council discussed a conference call held last week with the Competition Bureau in response to Woolwich’s concerns. The conversation seemed to suggest it would be possible to simply close the store and move to another location, say to the former grocery store downtown (ironically, across the street from the Shoppers Drug Mart), under the No Frills or other Loblaw banner, chief administrative officer David Brenneman reported.
He noted that both Kitchener-Conestoga MP Harold Albrecht and his provincial counterpart MPP Michael Harris, also participants in the call, were left with the same impression.
“We need to get some clarification from the Competition Bureau … get this in black and white,” said Brenneman.
Having fired off a letter outlining its concerns that the federal agency’s decree would force the closure of one store in a market with only two grocers, the township also received a written response from the Competition Bureau last week.
The letter explains the agency’s rationale for ordering Loblaw to divest itself of holdings where its takeover of Shoppers Drug Mart would leave it in control of two operations that formerly competed, such as the No Frills store in Elmira which features a pharmacy.
While the township called on the Competition Bureau to reconsider its stance, allowing the No Frills store to continue to operate, the agency’s letter suggested it would stay the course. It wants to see the store sold to a competing grocery chain.
“In Elmira, the consent agreement negotiated with Loblaw requires the divestiture of the No Frills store in order to address the bureau’s competition concerns in that market. Importantly, the store in question must be sold to a competitor. More specifically, the buyer of the store must have both the ability and the intention to be an effective competitor to Loblaw in the market.”
Looking to clarify the order, and responding to feedback from residents, the bureau sent out an open letter to the community this week.
Assistant deputy commissioner Anthony Durocher said the No Frills store would continue to operate until a suitable sale could be arranged.
“We know that many area residents are worried that the store will simply close if it doesn’t sell. This is not the case. There are additional parts of the agreement that will apply if Loblaw is unable to sell any of the stores that it must divest within a confidential time period, which will ensure that each local market remains competitive,” he wrote. “In the meantime, Loblaw is required to maintain its stores and run them as usual, including the No Frills store in Elmira.”
The township, meanwhile, will continue to work towards a solution that sees the store remain.
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