Canada Seeks Competition Bureau Probe of Cleveland-Cliffs Over Stelco Acquisition and Layoffs
Industry Minister Mélanie Joly has asked the Competition Bureau to investigate Cleveland-Cliffs and its CEO after he admitted buying Canadian steelmaker Stelco to protect U.S. markets, amid disputes over hundreds of job cuts in Hamilton.
Industry Minister Mélanie Joly has formally requested that the Competition Bureau investigate Cleveland-Cliffs Inc. and its chief executive, Lourenco Goncalves, for potential violations of the Competition Act. In a letter to acting competition commissioner Jeanne Pratt, Joly asked whether recent public comments by Goncalves warrant enforcement action.
The request follows an Oct. 27 interview with CBC News in which Goncalves stated he acquired Canadian steelmaker Stelco because he could not afford to have it "flooding the market here in the United States to the detriment of my own company." The federal government alleges that during the 2024 acquisition, Cleveland-Cliffs agreed to maintain unionized employee numbers at 2024 levels through 2029. Joly contends the company is now violating those legally binding employment commitments.
Cleveland-Cliffs maintains it is in full compliance with its obligations under the Investment Canada Act and expects to report annual employment numbers well above the minimum required. Goncalves reported that 175 people have been laid off so far in Canada, describing the reductions as temporary with no further cuts planned and potential re-hiring by Christmas. He attributed the layoffs partly to a 50 per cent U.S. tariff on aluminum and steel.
Stelco announced in late September that it was cutting up to 500 jobs in Canada due to an inability to make money in its galvanized-steel business. While Stelco management has stated some laid-off employees will be offered jobs at the Lake Erie facility, the union reports only 40 jobs have actually been offered there.
Prime Minister Mark Carney stated that Cleveland-Cliffs had "betrayed" its workforce and warned that failing to respect acquisition commitments would be a mistake. In a separate letter dated Oct. 29, Joly wrote to Stelco president Paul Simon demanding a concrete plan for re-engaging workers within 15 days or face legal action.
Opposition lawmakers have criticized the government's response. Conservative MP Michael Guglielmin called Joly's approach an exercise in shifting accountability and urged the government to file a lawsuit to save Canadian jobs.
An investigation by the Competition Bureau could result in financial penalties or the forced divestiture of Stelco, though the timeline for any outcome remains uncertain and could take months or years.