Mauritius Brief – 14/09/2010

14 September 2010|In Mauritius Briefs

In this issue:

  • IBL found in contravention of the Competition Act – abuse of monopoly position

IBL found in contravention of the Competition Act – abuse of monopoly position

The Competition Commission of Mauritius (“CCM”) has ruled that Ireland Blyth Consumer Goods’ (“IBL Consumer Goods”) Top Store Program (“TSP”) contravened the Mauritian Competition Act.

The CCM concluded after an investigation that IBL Consumer Goods had abused its monopoly position and that its TSP had the effect of “preventing, restricting or distorting competition”. IBL Consumer Goods’ TSP sales program, which commenced in June 2009, offered volume-related discounts to retailers on Kraft block processed cheese when specified shelf-space was allocated to the cheese and other Kraft-branded products.

During the hearing IBL rebutted the conclusion of the CCM’s preliminary report, stating that the amount of shelf space allocated was merely proportional to the market share, and that the increase in Kraft sales during the second half of 2009 was directly related to a substantial increase in advertising and promotional budget and efforts, as well as to specific retailers growth during that time.

The Executive Director of the CCM has stood by the conclusions reached in the preliminary report, and has directed IBL Consumer Goods to cease its practice of volume related discounts in exchange for premium shelf-space for all Kraft branded products.

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