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Dawn Raid on premises of three Coca Cola bottlers

United Kingdom
31/07/1999
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The Commission has carried out dawn raids in Austria, the UK, Germany and Denmark at the premises of the Coca Cola Company (CCC) and of its anchor bottlers. The Commission suspects that the Coca Cola company, which also has a share in its anchor bottlers, might be dominant in the Austrian, Danish and German markets respectively and might have abused its dominant position there. Three types of allegedly unlawful incentives were offered by the Coca Cola company. Two years ago the CCC had even agreed not to use any of these practices in the UK market.

The incentives under scrutiny are the following: target/growth rebates, full-range/assortment rebates, and exclusivity/delisting payments. The Commission suspects the first two types of schemes to be applied generally. The Commission also considered that the CCC may have engaged in discriminatory pricing through the granting of significant promotional rebates in the form of price reductions or free products which are sold by participating buyers during promotions.

The Commission made it clear that a dominant company on any market cannot indirectly coerce competitors by encouraging its customers to buy less of the competitor’s products. The only rebates or incentives which a dominant company may grant are rebates which pass specific savings onto its customers. The Commission identified the relevant product market as either cola-flavoured drinks or carbonated soft drinks. (Memo/99/42, European Report No 2427, 24.7.99, p.III, 7)

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