Anti-trust watchdogs muzzled and gagged?

SABMiller confirmed that its local subsidiary, Miller Trading Company, and two affiliated distributors have filed the complaint. The brewer said that “current practice restricts its access to the market, limits consumer choice and stifles competition in contravention of Mexico‘s competition laws.”

Cofeco said it would investigate practices to “displace” certain players from the market. It will also examine whether certain retailers get special discounts from the leading brewers, Heineken-owned FEMSA Cerveza and Grupo Modelo, in exchange for distribution exclusivity, it was reported.

Exclusivity contracts are quite the norm in Mexico’s retail culture. Or why would FEMSA, the former parent of FEMSA Cerveza have invested heavily in setting up a chain of 7,300 Oxxo convenience stores – if not to promote the exclusive sale of its beer and soft drink products through them?

SABMiller, which is no newcomer to Mexico’s beer business, has for several years tried to break into this market and has on previous occasions presented similar complaints. Always to no avail.

This time the situation may be different. FEMSA Cerveza is now controlled by Heineken and when it comes to foreign ownership Cofeco may have a different viewpoint.

Wait and see. Cofeco’s inquiry may take up to 120 days.