AdC issues Statement of Objections to Super Bock for fixing minimum resale prices of beverages in hotels, restaurants and cafes

​Press Release 10/2018
AdC issues Statement of Objections to Super Bock for fixing minimum resale prices of beverages in hotels, restaurants and cafes
 
The Portuguese Competition Authority (Autoridade da Concorrência – AdC) issued a Statement of Objections to Super Bock Bebidas S.A. for suspicion of behavior concerning the fixing of minimum resale prices of its products in hotels, restaurants and cafés, to the detriment of consumers.

In addition to the referred company, six members of the board and directors are also addressees in the Statement of Objections for being allegedly involved in the infringement in question.

The supplier’s interference in its distributors’ price determination restricts the latter’s ability to compete among themselves in so far as it eliminates price competition, while reducing consumers’ welfare, who have their choices limited and are no longer able to benefit from products at reduced prices.

Super Bock Bebidas is a leading undertaking active in the Portuguese sector of the production and sale of beverages, namely of beers, packaged waters, soft drinks, wines and ciders.

The AdC’s investigation concluded not only that the addressed undertaking allegedly fixed resale prices to its distributors, but also determined their trade margins, as well as other direct or indirect remunerations of its beverage brands in the HORECA channel – hotels, restaurants and cafés.

The investigation was initiated by the AdC in June 2016, following two complaints regarding the implementation of vertical price-fixing agreements in the contracts entered into between the addressed undertaking and its distributors.

The AdC’s provisional findings show that the restrictive practice lasted for, at least, 12 years (from 2006 up until 2017), and it has been continuously in place through the imposition, by the undertaking, of commercial conditions in the relationships established between its distributors and the latter’s clients, through the fixation of resale prices and the imposition of sanctions in case of non-compliance with the policy determined by the supplier.

Such behavior is liable to be qualified as a serious infringement of competition, with its legal framework in Article 9 (1) of Law no. 19/2012 (Portuguese Competition Act) and Article 101 (1) of the Treaty on the Functioning of the European Union (TFEU).

Pursuant to the case law of the Court of Justice of the European Union, vertical price-fixing is a restriction of competition by object which, by its nature and independently of any concrete effects that it may have, constitutes an appreciable restriction of competition.

Portuguese courts have also had the opportunity to reiterate their position as to this restriction’s nature and gravity, emphasizing that price-fixing is subject to the distributors and its clients’ freedom of contract, therefore not allowing a justification for the prices to be determined by a third party. Price-fixing must solely result from the free market, in accordance with the rules and principles governing its functioning.

During the course of the investigation, in 2017, the AdC conducted search and seize proceedings in the undertaking’s premises.
It should be emphasized that a Statement of Objections does not determine the final outcome of the procedure.

The addressees of the Statement of Objection have now the opportunity to exercise their rights of defense against the alleged infringement and possible applicable sanctions.

The Statement of Objections was adopted on 9th August, 2018. 
 
 10 August 2018