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$ 150 million fine to Quilmes beer for abuse of dominant position

2021-08-26T18:37:33.115Z


They accuse her of having made agreements with shops and bars to block her rivals and tie the sale of beers to her other products.


08/26/2021 14:02

  • Clarín.com

  • Economy

Updated 08/26/2021 2:12 PM

The National Commission for the Defense of Competition (CNDC) imposed a "sanction" on

Quilmes

for

"abuse of a dominant position

.

"

The fine of

$ 150 million

was characterized by "proving an abuse of an exclusive dominant position in the beer distribution market," according to that body, which depends on the Ministry of Productive Development.

The proceedings were initiated by the

complaints made by CCU and Otro Mundo

, two competitors of Quilmes.

"Quilmes developed a set of loyalty strategies that aim to generate

exclusive spaces for the retail sale of beers

in the On and Off Premise channels, generating a

vertical closure of the market for current and potential competitors

", says the CNDC in a synthesis of your investigation.

The "on premise" market corresponds to bars and restaurants (

gastronomy

), while the off premise is stores,

supermarkets

and points of sale of these characteristics.

"It is

the first time in at least 20 years

that a fine for abuse of dominant position has been imposed on a mass consumer company. It is the most important fine in the last 15 years, and the highest since 2011," they highlighted in Desarrollo Productivo .

"In relation to the decision adopted by the National Commission for the Defense of Competition, we clarify that it is a process that

has not yet been completed,

" Quilmes defended in a statement. 

"We fully comply with the Law for the Defense of Competition, and we will continue to contribute to the beer market, and, ultimately, to the general economic interest," they said.

According to the official report, Quilmes promoted

exclusivity

in the sale of beers in bars and restaurants "in exchange for money contracts, advertising, furniture and

discounts on the portfolio of products it sells

(beers, waters, flavored waters, isotonic, soft drinks, energizers ".

The company also made "demands for exclusive and preferential spaces in gondolas and leading in the Off Premise channels 

exceeding its market share

(supermarkets, self-services and large stores), in exchange for discounts and promotions," according to CNDC.

The CNDC found that it had

"exclusivity in the use of refrigerators

" both in gastronomic establishments and in retail trade.

"All these practices constituted the establishment of barriers to entry in the beer distribution market. From the point of view of the defense of competition, the entry barriers allow firms that operate in the market to obtain profits supra competitive,

preventing current or potential competitors from disciplining prices,

"observes the regulator.

The CNDC says it will force Quilmes to maintain a marketing strategy for its beer brands "

independently

of the rest of the beverages it distributes."

In addition to beer labels (Quilmes, Brahma, Stella Artois), the company does the distribution of the Pepsi system brands (such as Pepsi and Seven Up).

In the gastronomic sector, it is said that by accessing the Pepsi line, Quilmes offers discounts on its beers.

While the company's beer brands dominate the market, Pepsi's

lags behind

in mass consumption relative to Coca-Cola.

"Exclusive advertising and promotion agreements for your beer brands –through the delivery of furniture, marquee or others– must have

a maximum duration of three years

with the possibility of early termination after the first year and without automatic renewals;

They must not prohibit the sale of competitor products,

nor orders of preference in the offer of products, and they will allow the inclusion of the competitors' products in the menus or menus, "the CNDC explains.

The CNDC established that "Quilmes may not establish any type of

formal or informal

commercial agreement

with the points of sale –both On Premise and Off Premise– that has the purpose or effect of generating vertical restrictions on the marketing channels in order to: obtain exclusivity of sale or first option of their products; eliminate competitors from the letters, menu or others; or limit the exhibition of the competitor's products through exclusive space agreements in gondolas or leading edge, among other limitations ", they pointed out. .

NE

Look also

An Argentine group bought a wine giant in the United States

Quilmes adds wine to the beer business: he bought the Dante Robino winery

Source: clarin

All business articles on 2021-08-26

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