NDP MPs call for investigation into 'potato cartel' price-fixing allegations
Allegations that producers are conspiring to drive up prices of potato products 'deeply troubling,' MPs say
Two federal politicians have asked Canada's competition commissioner to investigate whether companies have been conspiring to raise the price of frozen potato products — like fries and tater tots — after similar allegations were made in the United States.
NDP MPs Alistair MacGregor and Brian Masse — the Opposition critics for food price inflation and industry, respectively — sent a letter Monday asking competition commissioner Matthew Boswell to start a "comprehensive" investigation into whether businesses have been working together illegally.
"We are writing to bring your attention to significant concerns about competition and price gouging at the grocery store," the MPs wrote.
"Allegations of price fixing to charge families more for basic grocery staples are deeply troubling."
The letter referenced reporting by CBC News last week on proposed class-action lawsuits in the United States, which claim four of the largest producers have come together in a "potato cartel" to drive prices up for consumers since at least early 2021.
The documents say the businesses shared sensitive internal information with one another so they could raise the prices of their goods by roughly the same amount at roughly the same time. Since the four companies control a combined 98 per cent of the frozen potato product market in the United States, the lawsuits said, nearly synchronized increases would essentially dictate the entire industry's price.
Four more lawsuits with similar allegations have since been filed against the same companies in U.S. District Court.
The claims are all focused on prices in the United States, but two of the businesses are Canadian: McCain Foods and Cavendish Farms. Both businesses have headquarters in New Brunswick.
McCain denied the price-fixing accusations in a statement last week, while Cavendish did not respond to a request for comment.
The allegations have not been proven in court and none of the companies have filed statements of defence.
Canada has seen price fixing before, MPs note
In their letter Monday, MacGregor and Masse said Canada is no stranger to price fixing. There was a similar antitrust scandal over a widespread scheme to fix the price of bread for more than a decade, which ultimately saw Canada Bread fined $50 million and Loblaw promising to pay out $500 million.
"Canadians are, unfortunately, familiar with giant companies conspiring to raise the cost of food thanks to the bread price-fixing scandal," MacGregor and Masse wrote. "They are tired of getting ripped off by greedy CEOs that cut down competition and drive up prices."
CBC News has contacted the commissioner's office for comment on the MPs' letter.
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With files from The Canadian Press