The commission will keep an eye on Singapores soft drinks market

The commission will keep an eye on Singapore's soft drinks market

Coca-Cola Singapore has agreed to amend its supply contracts to remove “potentially anti-competitive” elements after an investigation by the country's competition authorities.

The Competiton Commission of Singapore said late last week that it has dropped its review of the company after it agreed to comply with a number of conditions. However, the commission said it will continue to monitor the soft drinks market.

The authority launched its investigation last March after a complaint that Coca-Cola Singapore had “incorporated restrictive provisions in its supply agreements with on-premise retailers, such as exclusivity conditions and conditional rebates”.

The company has subsequently agreed to: 

  • Not impose any exclusivity restrictions on its on-premise retailers for Coca-Cola brands of non-alcoholic beverages, except in limited circumstances
  • Not require its on-premise retailers who wish to sell other brands of beverages to first negotiate with the company 
  • Not grant loyalty-inducing rebates that have the effect of inducing on-premise retailers to purchase exclusively - or almost exclusively - from Coca-Cola Singapore 
  • Allow its on-premise retailers to use up to 20% of the space in coolers provided by Coca-Cola to store other brands of beverages, when these retailers have no access to alternative cooling equipment on their premises.

The commission added: “In general, agreements which serve to prevent, restrict or distort competition are discouraged and may be illegal under the Competition Act. CCS encourages all businesses to proactively review their competition compliance practices to ensure their business conduct fully comply with the Competition Act.”