Coke-Cadbury Licence Deal Cleared By Eu
The European Commission yesterday said it had cleared the licensing arrangements between Cadbury-Schweppes and Coca-Cola Enterprises Inc which are part of a deal already cleared by the Commission under which Coca-Cola has taken full control of British bottler CCSB.
It said in a statement that the arrangements are valid for an initial period of 15 years, extendable by a further 10 years. But the Commission said it reserved the right to re-examine the agreements in the light of any new circumstances and in any event after seven years.
Earlier this year the Commission cleared the acquisition by Coca-Cola of Coca-Cola and Schweppes Beverages Ltd (CCSB) which was formerly jointly controlled by the two companies. It said at the time that it would have to review the licensing arrangements between the two companies which allowed CCSB to continue producing and distributing Cadbury-Schweppes branded soft drinks.
The Commision said Coca-Cola had agreed to give an undertaking that it will not include certain types of restrictive provisions relating to the purchase of cola-flavoured beverages in agreements concluded or renewed with customers in Great Britain.
Coca-Cola particularly said it would abstain from exclusivity provisions and fidelity rebates, target rebates, conmbined target rebates and tying provisions in such arrangements It also agreed to provide the Comm-ission with annual reports detailing sales volumes and market shares for each flavour category in Great Britain.