The Consumer Protection and Fair Trade Authority announces its intention to issue an administrative order to stop infringement to the three soft drink companies that control the category: The Central Company for the Production of Soft Drinks Ltd. (Coca-Cola), Tempo and Jafora-Tabori.
According to the demand of the Consumer Protection Authority, the companies must restore the price immediately as the price increases and cancel the planned price increase.
According to the Authority, the companies' decision to raise the prices of their products at the same time, when all three control the vast majority of this market, harms consumers' freedom of choice and they are forced to purchase the products despite the price increase, which constitutes an unfair influence on the Israeli consumer.
These are companies that market and sell a variety of drinking products including carbonated drinks, soft drinks, alcoholic beverages, water and more, whether by themselves or through subsidiaries. Over the years, the companies have become dominators in the category and a significant and powerful factor in the field of soft drinks, some of them in a variety of beverages. During March-April 2023, the companies simultaneously announced an increase in the price of various soft and carbonated beverages produced by them.
Soft drinks, photo: GettyImages
Impairment of the ability to choose
According to the Authority, these actions by the companies constitute an unfair influence on the Israeli consumer. They also argue that the companies' decision to raise the prices of their products at the same time, when all three control the vast majority of this market, harms consumers' freedom of choice, in that consumers are effectively forced to purchase the products despite the price increase. This constitutes an unfair influence on the Israeli consumer.
The Authority says that another unique violation of the Central Company for the Manufacture of Soft Drinks (Coca-Cola), which over the years has become a significant and powerful factor in the field of soft drinks, through a variety of actions, some aggressive, taken to promote its products in the market, the practical and cognitive influence of the company on the consumer, harm the consumer's ability to choose and his freedom of communication. Under these circumstances, raising the price of products constitutes exerting unfair influence on the Israeli consumer.
"Deal with the violation"
The actions required by the Authority are: Immediately cancel the planned price increase, and where a price increase has been made, the companies must restore the price immediately. The companies will have to provide documentation within 14 days of the date of issuance of the administrative order attesting to its implementation.
Photo: Dudi Vaknin // Nir Barkat,
Due to a violation of the provisions of the administrative order to stop a violation, a monetary penalty of three times the amount of the monetary penalty will be imposed for the violation or alternatively, criminal proceedings will be taken.
The companies may make their claims in writing regarding the cancellation of the intention to issue an administrative order to stop infringement, within 7 business days from the date of delivery of the notice.
Anita Yitzhak, deputy commissioner of the Authority and head of the Investigations and Intelligence Division, said that "the Authority will not allow companies to exploit their power and leave the consumer without freedom of choice. These companies control the soft drinks category completely, and by raising prices at the same time, they have almost completely closed all options to the consumer and harmed the consumers' freedom of choice."
The Central Soft Drinks Company said: "The request by the Consumer Protection Authority appears on its face to be baseless, lacks any factual or legal basis, and clearly deviates from the scope of the authority and activity of the Consumer Protection Authority."
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