Confectionery giants Nestle and Mars Inc have been charged by Canada’s Competition Bureau for alleged criminal conspiracy to fix the prices of chocolate products in the country.

The Bureau said a five-year inquiry uncovered evidence suggesting the two companies “conspired, agreed or arranged” to fix prices of chocolate products. The charges also include ITWAL, a network of independent wholesale distributors, and charged three individuals: Robert Leonidas, former president of Nestle Canada; Sandra Martinez, former president of Confectionery for Nestle Canada; and David Glenn Stevens, president and CEO of ITWAL.

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The accused face the possibility of a fine of up to C$10m and/or imprisonment for a term of up to five years if found guilty.

Interim commissioner of competition, John Pecman, called their alleged actions “egregious anti-competitive behaviour that harms Canadian consumers” and “a serious criminal offence.”

Nestle Canada said it will “vigorously” defend the charges. Mars did not return a request for comment at the time of going to press.

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The case also involves Hershey Canada, which has reached a settlement with the bureau that will see it plead guilty to one count of price-fixing.

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A spokesperson for the confectioner said: “Hershey Canada promptly reported the conduct to the Competition Bureau, cooperated fully with its investigation and did not implement the planned price increase that was the subject of the 2007 communications.”

The bureau said it has recommended that Hershey receive “lenient treatment”, as a result of its cooperation.