On June 3, 2025, The Property Controls for Grocery Stores and Supermarkets Act (Various Acts Amended) (the "Act"), came into force, taking direct aim at restrictive covenants and exclusivity clauses in the Manitoba grocery store sector and beyond. The Manitoba government's stated purpose for the bill is eliminating private property controls that are seen to limit competition in the grocery sector, with the goal of improving public access to food retail options and lowering the cost of groceries across Manitoba.1 Manitoba appears to be the first province or territory to enact legislation regulating property controls, amidst a flurry of activity federally on the topic including new Competition Bureau guidelines regarding Competition Act enforcement, as discussed here.
In short, the Act curtails grocery store property controls on a go-forward basis, while outlining the process for justifying existing ones.
Which Property Controls are Under Scrutiny?
The Act — and the remainder of this bulletin — defines a "property control" as follows, with limited exceptions:2
- a restrictive covenant that directly or indirectly restricts the sale, ownership, development or use of land as a grocery store3 or supermarket;4 or
- an exclusivity clause that directly or indirectly restricts the sale, ownership, development or use of land as a grocery store or supermarket granted in favour of (i) a person5 who, directly or indirectly, owns or operates a supermarket or (ii) a person who is related to a person who, directly or indirectly, owns or operates a supermarket.
We flag that this definition does not contain a materiality threshold and, for restrictive covenants, applies regardless of the party to whom the restrictive covenant was granted.
Property Controls Predating the Act
As of June 3, 2025, any new property control that applies within Manitoba is now legally unenforceable.6
Any existing exclusivity clause granted in favour of a person who does not own or operate a supermarket, that has the "direct or indirect effect of restricting the sale, ownership, development or use of land as a supermarket", is automatically amended to remove such restriction. So even non-grocery store operators could have their leases automatically revised to narrow existing language.
For existing restrictive covenants or exclusivity clauses, there is a process for them to be deemed enforceable, subject to their ability to be challenged (as described below). In order to have an existing restrictive covenant or exclusivity clause deemed enforceable, the holder must register the relevant agreement on title to the subject land before November 30, 2025 and have that registration accepted by Land Titles before December 30, 2025 (the "Registration Period").7
Process for Challenging Property Controls (Registered or Otherwise)
- Despite successfully registering on title, a member of the
public8 may challenge a property control by applying
directly to the Municipal Board during the Registration
Period9 or to the relevant Minister at any
time,10 in the prescribed form, alleging that the
property control is "contrary to the public
interest".11 The Minister may also review an
alleged property control using the same public interest test and
refer the matter to the Municipal Board.
- Upon such referral or application, the Municipal Board must
hold a public hearing regarding removal, and consider the following
factors:
- whether the area covered, duration, and scope of the property control are reasonable in the circumstances;
- the effect of the restrictions imposed by the property control
causes or contributes to "a lack of access to grocery stores
or supermarkets serving the community in the surrounding
area",
in determining whether to uphold, amend or strike down the clause at issue.
- Upon such referral or application, the Municipal Board must
hold a public hearing regarding removal, and consider the following
factors:
- After the Registration Period, if Land Titles "becomes aware" that a property control has been registered on title, they must discharge the instrument containing the property control, without notice to the holder.12
- If a person has their agreement struck down by the Board, their registration submission rejected by Land Titles, their instrument discharged by Land Titles, or they fail to register during the Registration Period, the government cannot be sued to overturn the decision.13
Implications
Landlords, tenants, and developers should review existing leases and other agreements that relate to properties in Manitoba to determine if there are property controls that should be registered or could be challenged under the Act. Given the potential for existing controls to be invalidated, even if registered on title, stakeholders should proactively determine the necessity and public interest justification for such provisions. While the challenge process has yet to be fully outlined, gathering data and arguments now seems wise.
Businesses should note the rather weak protection of registering on title within the Registration Period, and the multitude of potential challengers.
Footnotes
1. Legal practice preventing competition near existing Manitoba grocery stores might come to an end.
2. Exceptions include restrictive covenants or exclusivity clauses granted as part of a building scheme covenant or exempted by forthcoming regulations: Bill 31, The Property Controls for Stores and Supermarkets Act (Various Acts Amended) ["Bill 31"], Part 1, The Law of Property Act, CCSM, c L90 amended ["LPA"], s 7.1(7).
3. Note that this excludes a "convenience store", defined as a store that offers for sale a variety of food products and is smaller than 3,013 square feet.
4. Defined as a grocery store comprising at least 10,000 square feet.
5. Defined broadly to include both individuals and corporate entities.
6. Bill 31, LPA, s 7.1(4).
7. Ibid, s 7.1(5).
8. Bill 31, The Real Property Act, CCSM, c R30 amended ["RPA"], s 152.3(2).
9. Bill 31, The Municipal Board Act, CCSM, c M240 amended ["MBA"], s 104.2(1)(b).
10. Bill 31, RPA, s 152.3(2).
11. This aligns with the test in Alberta to apply to Court for discharge of a restrictive covenant registered on title: Land Titles Act (Alberta), s 48(4).
12. Bill 31, RPA, s 152.1(6).
13. Bill 31, RPA, s 152.4.
The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.
© McMillan LLP 2025
