Court orders big ag firms to hand over documents in antitrust probe

Charles Baron and partners brought FBN to Canada in 2017, buying Saskatchewan-based Yorkton Distributors. (FBN video screengrab via YouTube)

Ottawa | Reuters — A Canadian federal court has ordered a group of major agriculture companies to hand over records and communications in an antitrust probe sparked by allegations some businesses tried to block online farm-supply startup Farmers Business Network (FBN).

In a series of court orders issued Tuesday, Federal Court Justice Denis Gascon said he was satisfied that Canada’s Competition Bureau was conducting an antitrust probe and that the named companies — which include Bayer, Corteva and BASF — would have or were likely to have information relevant to the inquiry.

Farm supply wholesalers, including Cargill, Univar Solutions and Federated Co-operatives, have also been ordered to produce records. The companies have 60-90 calendar days to comply, depending on the specific order.

The Competition Bureau said on Wednesday it had obtained the court orders in order to advance its investigation into allegations a number of manufacturers and wholesalers of seed and crop products had refused or restricted supply to FBN.

The Canadian regulator said in a release it was also “investigating whether some of these entities may have engaged in coordinated behavior against FBN,” and added there was “no conclusion of wrongdoing at this time.”

California-based FBN said in a statement: “We believe competition and price transparency is fundamental to a market economy, and to lowering farm expenses, so we are pleased that the Bureau is looking into this matter.

BASF, Corteva, Bayer and Cargill said last Thursday they would co-operate with the Competition Bureau’s investigation, which was launched following a complaint from FBN.

The Competition Bureau had told the court in Jan. 30 filings that it was seeking records and communications from the seed, pesticide and wholesaling companies over allegations that its stopped supplying FBN’s newly acquired Canadian business in 2018.

The alleged conduct by the agriculture companies under inquiry, the regulator told the court, may also impede or delay FBN’s successful expansion into the Canadian marketplace and/or cause the company to exit altogether.

Founded in 2014, FBN is developing an online marketplace for farmers to order crop inputs like pesticides, seed and other agricultural supplies.

The Competition Bureau said Wednesday the company’s online platform also included a pricing comparison tool that allows farmers to receive aggregated information on what other farmers are paying for agricultural products.

FBN, which has been selling crop inputs through its e-commerce platform in the United States since 2016, entered Canada in November 2017.

— Kelsey Johnson is a Reuters economics reporter in Ottawa.

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