In the wake of allegations of overcharging, city convenience store owners are set to file complaints against a major tobacco company with the federal government's competition bureau.

The reason: they're being denied cigarettes from a big box store and are being directed to a local company they say overcharges.

In a series of interviews this week, Whitehorse tobacco retailers say they've been barred from ordering Imperial Tobacco Canada brand cigarettes, including du Maurier and Players, from the Real Canadian Superstore.

The owners say they have been told they must buy those brands of smokes from G-P Distributing Inc., which has a contract with the tobacco giant.

Ken Achtymichuk, who owns Heather's Haven in Porter Creek, said last week he's looking to file a complaint with the Competiton Bureau of Canada because he's being told where and how he can buy tobacco products for his store.

The retailer said while he originally bought from G-P when he opened in December 2006, he switched stores when he found out the Superstore's prices were cheaper.

'Up to roughly a couple of weeks ago, a month ago, I used to be able to go into the Superstore and buy Export A and Imperial products, Players or du Maurier, either/or, and there was no problem.

'We have a tobacco licence and the whole bit; we'd just fax our order in and pick it up,' Achtymichuk told the Star.

'(The Superstore) was told from Imperial tobacco not to sell to us; I got a call from Superstore's head office about this.

'That's called corporate communism. I really feel that Imperial thinks they own the Yukon when they think they can tell me where I can go and buy their product.'

Prices and accessibility of JTI-Macdonald products such as the Export A line have not been affected, Achtymichuk and other retailers maintain.

Achtymichuk said he's upset he's being told he must buy from G-P because the local distributor is charging more than the Superstore, and he'll have to pass the costs on to his customers.

'G-P's like, $6 more a carton,' he said.

A carton typically holds 200 cigarettes.

According to a March 1 receipt, the Superstore was charging $65.99 before taxes for a carton of Players or DuMaurier brand cigarettes.

A Feb. 15 invoice from G-P shows the local distributor was charging $71.45 before taxes for the same tobacco products.

Price checks at G-P and the Superstore this week confirmed both prices remain the same.

Achtymichuk said he's looking into purchasing from an Outside wholesaler to avoid paying more for the tobacco products and passing the costs on to his customers.

'I look like the bad guy here,' he said.

Ray McLennan, who owns Mr. Video Gas-'n-Go in Granger, said even though he wasn't purchasing from the Superstore, he too is looking to file a complaint with the competition bureau over the situation.

McLennan said he's elected to order his Imperial brand cigarettes from Wallace and Kerry Inc., a wholesaler based in Edmonton, and pay for the freight charges because he can buy the cigarettes more cheaply that way.

McLennan said he doesn't feel it's right for Imperial to dictate where and how Whitehorse retailers can purchase their products.

'I'm looking at a competition bureau complaint. This is a vertical restraint; it's forcing a businessman to buy from one particular company.

'As an independent businessman, I have the right to be independent so I should have the right to make a choice and not have to deal with one particular company.

'It's product control; they're trying to protect a single distributor in town that they appointed and basically put competition to the wind.'

Imperial's actions, McLennan added, may also fall under refusal-to-deal rules of the federal government's competition bureau.

'I'd really like to hear what Imperial has to say about this,' he said.

Norm Goodman, the owner of Goody's Gas Bar in Porter Creek, said he'd also like some answers, as did John Klemenz, who manages McIntyre's Bernie's Race Trac gas station.

Both retailers say they have also been turned away from the Superstore as of a few weeks ago.

'As far as I know, G-P Distributing made a stink and now Superstore is not allowed to sell them to us,' Klemenz said.

'The distributor is $6 higher for what Superstore sells a carton for ... this is making my life harder,' he said.

Goodman said he'd like to know how Montreal-based Imperial can control where a store in Whitehorse purchases Imperial products.

'What I really don't like is Imperial telling me where I can and can't buy; that's the part that really p----s me off,' he said.

Goody's, Goodman added, currently stocks its shelves with Imperial brand products via G-P Distributing but still buys its other wholesale cigarettes from the Superstore.

According to the competition bureau, vertical restraint is a term used to describe such practices as exclusive dealing, tied selling and market restriction.

Vertical restraints, bureau information states, occurs when a supplier puts conditions on the supply of a product which constrain the customer in terms of where a product can be marketed or what other product lines must be carried as a condition of containing a supply.

McLennan said he feels the problem can be traced back to Imperial's decision to eliminate its use of wholesalers in Canada last September.

Instead, it went into a new system called direct-to-store delivery, which sees Imperial market and sell its cigarettes directly to retailers.

Since moving to the new system, McLennan added, tobacco retailers have faced cigarette shortages and have had to raise, not lower, the price of Imperial brand cigarettes.

According to a May 16, 2006 Imperial media release, the direct delivery system was implemented to become more efficient.

'In recent years, we have undertaken measures to become more efficient in an increasingly and challenging environment,' Imperial's media release states.

'At this time in our history, this important initiative makes good business sense for Imperial Tobacco Canada.'

In an interview Wednesday, Lori Stene, the director of public affairs for the Real Canadian Superstore, said her organization stopped selling cigarettes to Whitehorse retailers because Imperial threatened to cut off its tobacco supply if the company continued wholesaling to small businesses.

'We've received a couple of warnings from Imperial Tobacco of Canada on this issue,' she said.

'According to the trade terms we have with them, we are not allowed to wholesale their product, not one carton,' Stene told the Star.

'If we do not comply with this, our account with Imperial will be terminated; they were very clear on that.'

Stene called the situation with Whitehorse retailers regrettable but said the problem is being experienced in many parts of Canada.

Kyle Doll, part owner and operator of G-P Distributing, said he supports Imperial's decision to warn the Superstore.

Doll said after signing a deal to be Imperial's sole wholesale representative in the territory last fall, he filed complaints with the tobacco giant over the Superstore's continued sales to retailers.

'My contract with Imperial is to service the retailers in the Yukon except for, at this point, Shoppers Drug Mart, Petro Canada and Superstore.

'I made the complaints with Imperial Tobacco because of the agreement that we have and the agreement that Superstore has with Imperial Tobacco, which is that they will only sell to the end user.

'They continued to sell wholesale to the convenience stores and the grocery stores, and I have an investment to protect, and that was the reason for it.'

He said he's had to spend a considerable amount of money on construction, fuel and staffing since signing the deal.

Doll said he doesn't feel he's charging too much and that his supplier, Imperial, would never permit him to overcharge.

Catherine Doyle, Imperial's manager of corporate communications, said this week her company's decision to directly market and deliver to retailers in Canada was a business decision.

The new business model, she added, wasn't feasible in the North, so the company decided to go with G-P as a wholesaler after other businesses backed out.

'We went with direct-to-store delivery. Our reps go into a retailer and then we send our products directly to the retailer; in nothern territories and other rural areas, that wasn't feasible,' she said.

'In Yukon, there was an issue with wholesalers backing out so we decided to go with one wholesaler, G-P Distributing. I understood that there wasn't any problems there.'

Doyle said she would have to research the Superstore situation.

'We're looking into the Superstore matter to try to understand the issue,' she said.

According to Yukon Bureau of Statistics figures for 2005, 8,247 Yukoners, 30.4 per cent of the population, smokes.

The national average, according to the bureau, is 21.7 per cent.

The Yukon, according to the bureau, has the third-highest per capita rate of smoking in Canada behind Nunavut, at 52.8 per cent, and the Northwest Territories (36 per cent).

The bureau does not have figures for the total amount of tobacco sold in the territory.

According to the territorial Department of Finance, a total of $6,652,922, including 13.5 cents on every cigarette, was collected in territorial tobacco taxes in 2005/06.