‘A shocking admission’: Melanie Joly asks Competition Bureau to probe Stelco’s U.S. owner after CEO’s testimony

The timing isn’t a coincidence. Joly’s letter asking for the review landed on the same day Ottawa’s 15-day deadline expired for Cleveland-Cliffs to address layoffs at Stelco. On Sept. 28, the company announced plans to lay off up to 500 workers at its mills in Hamilton and Nanticoke, Ontario. It cited U.S. tariffs, weak demand for Canadian steel and competition from imports. So far, the company and the union have confirmed 175 layoffs, all in Hamilton. Ottawa says the cuts break the job commitments Cleveland-Cliffs made to get the deal approved.

Cleveland-Cliffs maintains it has kept its word. In late October, the company said a review with its legal counsel found Stelco in full compliance with all 34 of its undertakings to Ottawa. The company did not respond to requests for comment on Joly’s letter to the bureau.

That raises questions bigger than one mill, including how foreign takeovers are vetted, whether Canada’s competition watchdog can act after a deal closes and who pays when domestic supply shrinks.

Why is Joly calling in the Competition Bureau now?

On Nov. 6, Joly asked the Competition Bureau to look at Cleveland-Cliffs’ conduct since it bought Stelco in November 2024. In her letter, she wrote that the bureau “may wish to thoroughly examine” whether that conduct warrants enforcement action under the Competition Act.

Joly is referring to Cleveland-Cliffs CEO Lourenco Goncalves’ own words. In January 2026, he told the U.S. Congressional Steel Caucus that his company bought Stelco to block it from selling steel into the U.S. He made the same point during a late October interview on CBC’s Power & Politics, where he said he could no longer afford Stelco steel flooding the American market “to the detriment of my own company.”

Joly called the remarks “a shocking admission” for workers at Stelco’s mills in Hamilton and Nanticoke, Ontario.

That explanation is a sharp departure from how the deal was initially pitched, when Goncalves described Stelco as a cost-efficient, profit-oriented company. He also framed the purchase as a way to lower Cleveland-Cliffs’ cost structure.

The bureau reviewed the roughly $3.4-billion acquisition between August and October 2024 and issued a no-action letter. Joly is now calling for more scrutiny based on what she views as new evidence about the firm’s intent.

Who’s right about steel prices?

In her letter to Competition Commissioner Jeanne Pratt, Joly said that Stelco pushed up steel prices by idling its Hamilton operations while demand was high. “Lower output means higher prices for Canadian manufacturers, which are inevitably passed down to consumers,” she said.

The company’s position is that the real problem is a waning market. In an Oct. 9 letter to Joly, Stelco president Paul Simon wrote that Stelco can’t keep making cold-rolled and coated steel without losses it can’t sustain. He argued that Canada’s trade protections are too weak to support two domestic producers of those products, Stelco and ArcelorMittal Dofasco, alongside foreign imports. Simon also argued that Ottawa’s offer of financial help wouldn’t fix the underlying lack of orders.

Can the Competition Bureau actually do anything?

Possibly, but two competition lawyers say it won’t be easy. The Competition Act lets the bureau challenge a merger that substantially lessens or prevents competition, but timing works against Ottawa here. Under section 97 of the Act, a merger that was notified to the bureau before closing can generally be challenged only within one year of the deal being substantially completed. The Stelco deal went through that review and closed Nov. 1, 2024. Joly’s letter instead focuses on the company’s conduct in the Canadian market. Some conduct provisions in the Act, such as the abuse-of-dominance rules, allow applications up to three years after the conduct ends.