Consumer watchdog tells soft drinks cos to cut prices

The Consumer Protection and Fair Trade Authority has announced its intention or issuing an administrative order to end a breach of the Consumer Protection Law to Israel’s three largest soft drinks producers: The Central Bottling Company (Coca Cola Israel); Tempo, and Jafora Tabori. The authority is demanding that the companies should rescind the price rises they have announced in the past few months and immediately restore prices to their previous levels. The share price of Kerur Holdings, controlled by Shlomo Rodav and Ronnie Gat, which holds 70% of Jafora Tabori, is down by more than 3% on the Tel Aviv Stock Exchange.

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“The decision of the companies to raise their prices to the consumer at the same time, when the three control the vast majority of this market, harms the consumer’s freedom of choice, and consumers are compelled to buy the products despite the price rise, which represents unfair influence on the Israeli consumer,” the authority stated.

In March-April 2023, the three companies, which dominate the soft drinks category in Israel, all announced price rises for various soft and carbonated drinks that they produce.

The Consumer Protection and Fair Trade Authority had especially harsh words for The Central Bottling Company: “Over the years, the company has become a substantial and powerful player in the soft drinks market, through a range of actions, some aggressive, that it took to promote its products on the market. Its practical and psychological influence on the consumer harm consumers and their contractual freedom.”

The authority seeks to impose a financial sanction on the companies, which have seven days in which to make their case in writing against the issue of an administrative order.

Minister of Economy and Industry Nir Barkat said, “The step taken by the Consumer Protection and Fair Trade Authority joins our measures against the monopolies and cartels that have become accustomed to holding the country captive and abusing the public without hindrance. Those days are over. Our policy is clear: we will not allow the citizens of Israel to be harmed, or prices to be raised unchecked and the public to be abused. The Ministry of Economy and Industry will make use of all the tools at its disposal to fight the cartels and monopolies that abuse the public and raise prices without cause and treat the people of Israel as a cow for milking.”

Published by Globes, Israel business news – en.globes.co.il – on June 21, 2023.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2023.