NAIROBI, Kenya, Apr 14 – The Common Market for Eastern and Southern Africa (COMESA) Competition Commission has confirmed that Heineken Holding engaged in anti-competitive practices across its distribution networks within member states.
Following an investigation launched in 2021, the regional watchdog concluded that Heineken’s agreements with third-party distributors violated core provisions of the COMESA Competition Regulations.
The Commission’s Committee Responsible for Initial Determinations (CID) confirmed in its March 10th decision that the Dutch brewing giant breached Article 16(1) of the COMESA Competition Regulations by imposing “Territorial Restrictions, Single Branding Restrictions, and Minimum Resale Price Maintenance” on its distributors.
These restrictions, the CID determined, had the potential to distort competition and carve up the common market along national borders.
In response to the Commission’s concerns, Heineken entered into commitment negotiations on a non-admission of liability basis.
As part of the resulting agreement, Heineken will pay a cumulative administrative penalty of $900,000, representing $300,000 for each of the identified anti-competitive clauses.
“The vertical restraints imposed in the distribution agreements between Heineken and their respective distributors have an exacerbated effect on the market owing to the market position enjoyed by Heineken in some Member States,” the Commission stated in its findings.
“Heineken shall put in place corrective measures to ensure that its Distribution Agreements do not contain any provisions which could be considered to amount to Territorial Restrictions, Single Branding Restrictions, or Minimum Resale Price Maintenance.”
To avoid further legal proceedings, Heineken agreed to a set of corrective measures, including a full audit and amendment of all its distribution agreements in the Common Market.
It also committed to training its distributors and staff on compliance with the amended contracts and to submitting annual compliance reports over the next three years.
Heineken’s operations across Africa include significant markets in Kenya, Egypt, Nigeria, South Africa, Mozambique, and the Democratic Republic of Congo, among others.
The Commission emphasized that practices by such a large market player could have ripple effects on trade and competition across borders.
