Getting Coca Cola on Their Knees
In a truly David v. Goliath case, a convenience store owner in México refused to let Coca Cola tell her how to run her business, contacted the Federal Economic Competition Commission –CFCE, by its acronym in Spanish-, the Mexican Anti-Monopoly agency.
According to CNN.com,[1] Raquel Chávez’s inconformity arose when a distributor from Coca Cola threatened to stop selling her Coca Cola products because of her decision to sell a rival soft drink from Perú, Big Cola. Apparently, Coca Cola employees also offered her money to stop selling Big Cola.
Ms. Chávez went to the CFCE to submit a complaint for what is considered a monopolist practice under Mexican legislation, and that started an investigation that ended up with a fine of $68 million dollars.
The decision has been appealed, and a ruling can be expected next year.
Ms. Chávez is owner of an abarrotes, a mini-convenience store not bigger than a typical small classroom of a law school. According to her words, she did not want to be told what to do in her store.
Her case prompted a broader investigation and the CFCE found a pattern of similar behavior from Coca Cola with small businesses, and decided to impose the biggest anti-monopoly fines ever in CFCE history.
Apparently Ms. Chávez attempted to solve the matter with the distributor, but she failed. How could Coca Cola avoid all this trouble? Even assuming that Coke gets a reversal in appeal, or at least a reduction in the amount of the fine, it will cost it millions in attorney’s fees, public relations strategies, etc.
In the other hand, this result is good news, because Coca Cola was indeed incurring in monopolist practices under Mexican law, deliberately trying to push out of business to its Peruvian competitor.
But in any case a micro-entrepreneur challenged one of the world’s biggest emporia, jumping to fame and becoming a local hero.
Footnotes:
[1] Mexico Shop Owner Beats Coca Cola, Nov. 15, 2005, available at http://edition.cnn.com/2005/BUSINESS/11/15/mexico.coke.ap/; for a picture of Ms. Chávez, see http://news.bbc.co.uk/hi/spanish/business/newsid_4445000/4445826.stm.
According to CNN.com,[1] Raquel Chávez’s inconformity arose when a distributor from Coca Cola threatened to stop selling her Coca Cola products because of her decision to sell a rival soft drink from Perú, Big Cola. Apparently, Coca Cola employees also offered her money to stop selling Big Cola.
Ms. Chávez went to the CFCE to submit a complaint for what is considered a monopolist practice under Mexican legislation, and that started an investigation that ended up with a fine of $68 million dollars.
The decision has been appealed, and a ruling can be expected next year.
Ms. Chávez is owner of an abarrotes, a mini-convenience store not bigger than a typical small classroom of a law school. According to her words, she did not want to be told what to do in her store.
Her case prompted a broader investigation and the CFCE found a pattern of similar behavior from Coca Cola with small businesses, and decided to impose the biggest anti-monopoly fines ever in CFCE history.
Apparently Ms. Chávez attempted to solve the matter with the distributor, but she failed. How could Coca Cola avoid all this trouble? Even assuming that Coke gets a reversal in appeal, or at least a reduction in the amount of the fine, it will cost it millions in attorney’s fees, public relations strategies, etc.
In the other hand, this result is good news, because Coca Cola was indeed incurring in monopolist practices under Mexican law, deliberately trying to push out of business to its Peruvian competitor.
But in any case a micro-entrepreneur challenged one of the world’s biggest emporia, jumping to fame and becoming a local hero.
Footnotes:
[1] Mexico Shop Owner Beats Coca Cola, Nov. 15, 2005, available at http://edition.cnn.com/2005/BUSINESS/11/15/mexico.coke.ap/; for a picture of Ms. Chávez, see http://news.bbc.co.uk/hi/spanish/business/newsid_4445000/4445826.stm.
posted by Mastropiero @ 1:24 PM
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