Swiss multinational food and beverage company Nestlé has been slapped with a hefty fine of TI260 million ($8.7 million) by Turkey’s antitrust regulator, Rekabet Kurumu, for allegedly violating the nation’s competition regulations. In contrast, French dairy company Danone, implicated in the same investigation, faces no penalties.
Rekabet Kurumu’s investigation revealed that Nestlé, known for its Aero chocolate brand, had breached Article 4 of Turkey’s Protection of Competition law. This article explicitly prohibits any decisions that could “likely affect the prevention, distortion, or restriction of competition directly or indirectly in a particular market for goods or services.”
The regulator concluded that Nestlé’s actions constituted a violation by “determining the resale prices of its distributors and imposing regional and customer restrictions on its distributors.” Such practices are deemed anti-competitive and go against the principles of fair market competition.
As a consequence, Nestlé now finds itself facing a significant financial penalty for its alleged transgressions. The fine of TI260 million ($8.7 million) serves as a stern reminder of the consequences that can befall companies found in violation of competition laws.
An oral defense hearing for Nestlé is scheduled to take place on February 6, providing the company an opportunity to present its case and potentially contest the allegations made by the antitrust regulator. The hearing will be a crucial moment for Nestlé to articulate its position and attempt to mitigate the financial implications of the imposed fine.
The case has also garnered attention due to the contrasting situation faced by Danone, another major player in the food industry implicated in the same investigation. As of now, Danone has escaped penalties, leaving industry analysts and stakeholders curious about the divergent outcomes for the two multinational corporations.
Related: Just Food