German antitrust body opens probe against Coca-Cola

German antitrust body opens probe against Coca-Cola

Germany's Federal Cartel Office initiated "abuse proceedings" against Coca-Cola Europacific Partners Deutschland GmbH
Germany's Federal Cartel Office initiated "abuse proceedings" against Coca-Cola Europacific Partners Deutschland GmbH. Photo: JOHN MACDOUGALL / AFP/File
Source: AFP

Germany's antitrust watchdog said Tuesday it was opening a probe into US beverages giant Coca-Cola over rebates for retailers it said could give the company an unfair advantage over competitors.

The Federal Cartel Office based in the western city of Bonn said it had initiated "abuse proceedings" against Coca-Cola Europacific Partners Deutschland GmbH, which handles the company's bottling and distribution in Germany.

"There are indications of Coca-Cola possibly restricting the opportunities of other companies to compete based on how it structures its terms offered to German food retailers, in particular its rebate structure," cartel office president Andreas Mundt said in a statement.

"We will now take a closer look at this."

The office will begin by scrutinising whether Coca-Cola has a "dominant position or relative market power" in the soft drinks market in Germany, making it "subject to special competition law rules".

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It will examine the terms imposed by Coca-Cola on retail outlets, particularly whether its rebate structure "creates incentives" to buy, display and advertise drinks in the company's product line beyond its signature cola beverage.

Coca-Cola said it would cooperate with the authority but dismissed the accusations as baseless.

"We are convinced that the proven business model of Coca-Cola Europacific Partners in Germany with a balanced programme on pricing and conditions is legally compliant," vice president for legal affairs Andrea Weckwert said in a statement.

Germany's cartel office has launched a number of high-profile cases against US companies in recent years.

Last year it classed Google parent Alphabet as a company of "paramount significance for competition across markets", allowing for closer monitoring for possible abuse of its market position.

Fellow tech behemoths Amazon, Apple and Facebook owner Meta have also been placed under increased scrutiny.

The German Competition Act, which came into force in 2021, gives the cartel office greater powers to clamp down on anti-competitive behaviour by tech giants.

Source: AFP

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