The Nationwide Fee for the Protection of Competitors (CNDC) imposed a “sanction” on Quilmes by “abuse of dominant position”. The tremendous of $ 150 million It was characterised by “proving an abuse of an exclusive dominant position in the beer distribution market,” based on that physique, which is dependent upon the Ministry of Productive Growth.
The proceedings started at complaints made by CCU and Otro Mundo, two opponents from Quilmes.
“Quilmes developed a set of loyalty strategies that aim to generate exclusive beer retail spaces on the On and Off Premise channels, generating a vertical market closure for current and potential competitors“, says the CNDC in a synthesis of its investigation.
The “on premise” market corresponds to bars and eating places (gastronomy), whereas the off premise is warehouses, supermarkets and factors of sale of these traits.
“It is the first time in at least 20 years that a fine is imposed for abuse of dominant position to a mass consumption company. It is the most important fine in the last 15 years, and the highest since 2011 “, highlighted in Productive Growth.
“In relation to the decision adopted by the National Commission for the Defense of Competition, we clarify that it is a process that not finished yet“Quilmes defended himself in a press release.
“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 mentioned.
In accordance with the official report, Quilmes promoted exclusiveness within the sale of beers in bars and eating places “in exchange for contracts of money, advertising, furniture and discounts on the product portfolio it sells (beers, waters, flavored waters, isotonic, carbonated, energizing “.
The corporate additionally made “demands for exclusive and preferential spaces in gondolas and leading edge in the Off Premise channels. higher than its market share (supermarkets, self-services and large stores), in exchange for discounts and promotions, “based on CNDC.
The CNDC discovered that he had “exclusivity in the use of refrigerators“each in gastronomic institutions and in retail commerce.
“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’ll drive Quilmes to keep up a advertising and marketing technique for its beer manufacturers “independently of the rest of the beverages it distributes. “Along with beer labels (Quilmes, Brahma, Stella Artois), the corporate distributes the manufacturers of the Pepsi system (similar to Pepsi and Seven Up). Within the gastronomic sector, it’s mentioned that For accessing the Pepsi line, Quilmes provides reductions on its beers.
Whereas the corporate’s beer manufacturers dominate the market, Pepsi’s they’re lagging in mass consumption in relation 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; must not prohibit the sale of competitive products, nor orders of preference in the offer of products; and they will allow the inclusion of the competitors’ products in the menus or menu “, the CNDC explains.
The CNDC established that “Quilmes will not be able to establish any type of commercial agreement formal or informal with points of sale –both On Premise and Off Premise– whose purpose or effect is to generate vertical restrictions on the marketing channels in order to: obtain sales exclusivity or first choice of their products; eliminate competitors from the cards, menu or others; or limiting the display of competing products through exclusive space agreements in gondolas or leading edge, among other limitations, “they said.