Mexico’s FTC: large brewers must change anticompetitive practices toward craft brewers

heineken logoPress Release from Heineken Corporation:

Cuauhtémoc Moctezuma receives resolution of the Federal Trade Commission concerning a complaint for anticompetitive practices

Cuauhtémoc Moctezuma received the resolution issued by the Mexican Federal Trade Commission (Comisión Federal de Competencia or CFC) concerning alleged violations of Mexican antitrust rules. This resolution constitutes the end of the pending investigation of the CFC regarding the Mexican beer market. Cuauhtémoc Moctezuma acknowledges the thorough analysis of the Mexican beer market by the CFC. Cuauhtémoc Moctezuma has fully cooperated with the CFC throughout the entire investigation and we are pleased that the CFC has approved the commitments we have offered to ensure that consumers will always have sufficient choice of a wide variety of good quality beers. In this respect, Cuauhtémoc Moctezuma will, among other things, create conditions for small brewers that manufacture beer in Mexico to supply their beers to restaurants, bars and canteens that currently have a preferential beer supply relationship with Cuauhtémoc Moctezuma. We will also standardise and simplify some of our future contracts with customers. Exhibit “A” contains a summary of our main commitments, which have been approved by the CFC. These commitments will become effective in 90 days. For more detailed information please visit the CFC website at www.cfc.gob.mx.

About Cuauhtémoc Moctezuma
Cuauhtémoc Moctezuma, founded in 1890 in Monterrey, Nuevo Leon, has emerged as the most innovative brewery in Mexico. Currently employs more than 18,000 people and has 6 plants focused on the production of beer, 3 plants of packaging and crown caps, one malt factory and one ice factory. Since May 2010, as part of the Heineken Group, Cuauhtémoc Moctezuma is part one of the largest breweries in the world in terms of volume and profitability. Since its incorporation, Cuauhtémoc Moctezuma assumes itself as part of the community and since then has been a firm promoter of actions responding to the needs of well-being and development of these environments. Cuauhtémoc Moctezuma ethically contributes to the generation of human, social and economic value, Brewing Better Future. Among its main brands are the following: Heineken, Tecate Light, Sol, Tecate, Carta Blanca, Indio, Dos Equis, Superior, Kloster, Coors Light, Noche Buena y Bohemia. For more information visit: www.cuamoc.com.

Exhibit “A”

Summary of Commitments offered by Cuauhtémoc Moctezuma (“CM”) and Approved by the CFCi

I CRAFT BREWERS: CM will allow Craft Brewers to sell their products to restaurants, bars and canteens that are Clients of CM. Craft Brewers are defined as those breweries that manufacture beer in Mexico and produce up to 100,000 HL per year.

II PREFERENTIAL SUPPLY AGREEMENTS
1. Standard Agreements: CM will standardise some of the clauses in future supply agreements in the Traditional Channel (small corner stores) and in restaurants (the “Supply Agreements”).

2. Limit on number of Supply Agreements: The total number of Supply Agreements shall not represent more than 25% of CM’s points of sale. CM shall reduce this percentage by 1 percent annually until it reaches 20%.

3. Exceptions: The Commitments do not include present or future relationships with: i) convenience stores, such as Oxxo; ii) CM affiliates; iii) hotel chains; and, iv) sponsored events.

4. Term: All future Supply Agreement shall have a limited term.

5. Existing Relationships:. There is no obligation to modify existing supply agreements; nevertheless any new agreement shall be executed pursuant to these commitments.

III COMMUNICATION WITH CLIENTS: CM shall communicate to clients in the Traditional Channel with no written preferential beer supply agreement the possibility to purchase products from different beer manufacturers.

i This document includes a summary of all substantive commitments. To review the full content of the commitments please visit the CFC web page at www.cfc.gob.mx

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.