Coca-Cola probe fizzles out pursuant to undertakings
A probe by the Singapore competition regulator into Coca-Cola Singapore’s business practices has been wrapped up pursuant to undertakings being agreed in relation to Coca-Cola’s supply arrangements and other conduct.
The Singapore Competition Commission commenced its investigation in March 2012, after it received complaints about Coca-Cola Singapore Beverages incorporating restrictive provisions in its supply agreements with on-premise retailers. The alleged anti-competitive conduct related to exclusive conditions and conditional rebates being implemented by Coca-Cola.
Coca-Cola voluntarily agreed to amend its supply arrangements in order to remove the potentially offending provisions and gave an undertaking to the Commission to address the concerns being investigated. The terms of the undertaking include:
- removing exclusivity conditions on retailers, thereby allowing them to stock other non-alcoholic soft drinks;
- removing provisions requiring retailers to negotiate with Coca Cola before stocking other brands;
- discontinuing loyalty-inducing rebates which effectively result in retailers purchasing Coca Cola brands only; and
- allowing retailers to use up to 20% of Coca Cola’s fridge space to store other soft drink brands if the retailer has no alternate fridges available.
While the Commission has accepted the undertakings and ended its 10 month investigation, it has publicly stated that it will “continue to closely monitor market practices in the local soft drinks market”.
