By Kelsey Johnson and Arundhati Sarkar
(Reuters) - The Canadian Competition Bureau said on Thursday it was investigating certain agriculture companies for alleged anticompetitive practices over allegations of trying to block an online farm-supply startup from doing business in Western Canada.
The regulator did not provide details on specific companies involved in the probe, but court documents filed on Jan. 30 in Canadian federal court show Bayer AG (DE:BAYGn), Corteva Inc (N:CTVA) and BASF (DE:BASFn) were among those that were being investigated following a complaint from California-based online retailer Farmers Business Network Inc (FBN).
Farm-supply wholesalers, including Cargill Inc and Univar Solutions Inc (N:UNVR), are also being probed, the court documents show, confirming an earlier report by the Wall Street Journal.
The Competition Bureau said in its court filings it was seeking records and communications from the seed, pesticide and wholesaling companies involved in the probe who are alleged to have stopped supplying FBN's newly acquired Canadian business in 2018, and some company officials urged farmers and others in the industry not to do business with the company.
Founded in 2014, FBN is developing an online marketplace that allows farmers to order crop inputs like pesticides, seed and other agricultural supplies. The company, which has been selling crop inputs through its e-commerce platform in the United States since 2016, entered Canada in November 2017.
The regulator told the court it believed the alleged conduct by the identified agriculture companies under inquiry is preventing FBN from selling branded crop inputs.
"The foregoing may impede or delay FBN's successful expansion into the Canadian market place and/or may cause FBN to exit the Canadian market place altogether," the regulator wrote in its court filings.
U.S. seeds and agricultural chemicals maker Corteva said it was aware of the Competition Bureau's investigation and that it was reviewing the inquiry and intends to fully cooperate with the regulator.
Bayer also said it was cooperating with the bureau.
"We believe the actions we took in this matter fully comply with Canada's competition law," Bayer said.
In a statement, Cargill said it was fully cooperating with the Competition Bureau's investigation.
"Cargill conducts business in a legal, ethical and responsible manner in each country where we do business – and Canada is no exception," the company said.
BASF was not immediately available for a request for comment.