German Watchdog Launches Probe Into Coca-Cola’s Rebate Practices

The Federal Cartel Office in Germany has announced the initiation of an antitrust investigation into Coca-Cola Europacific Partners Deutschland GmbH, a subsidiary of the US beverages giant Coca-Cola. The probe, which began on Tuesday, focuses on the company’s rebate practices for retailers, with concerns raised about potential anti-competitive behavior that could give Coca-Cola an unfair advantage over its rivals.

The Federal Cartel Office, based in Bonn, revealed that it has commenced “abuse proceedings” against Coca-Cola Europacific Partners Deutschland GmbH, responsible for the bottling and distribution of Coca-Cola products in Germany. Andreas Mundt, the president of the cartel office, stated that there are indications suggesting Coca-Cola may be restricting the opportunities for other companies to compete, particularly concerning its rebate structure offered to German food retailers, reported Reuters.

Mundt explained in a statement, “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.”

In response to the allegations, Coca-Cola expressed its willingness to cooperate with the German authorities but dismissed the accusations as baseless. Andrea Weckwert, Vice President for Legal Affairs at Coca-Cola Europacific Partners, asserted, “We are convinced that the proven business model of Coca-Cola Europacific Partners in Germany with a balanced program on pricing and conditions is legally compliant.”

This antitrust investigation is part of a series of high-profile cases that Germany’s cartel office has pursued against major US companies in recent years. Last year, Google’s parent company, Alphabet, was designated a company of “paramount significance for competition across markets,” subjecting it to closer monitoring for potential abuse of its market position.

As the investigation unfolds, industry observers will be closely watching to see how the allegations against Coca-Cola progress and whether the antitrust watchdog will find evidence of anti-competitive practices in the company’s rebate structure.

Source: Business Time