GVH: Coca-Cola changes its distribution contracts as a result of the competition authority’s proceedings

By: Trademagazin Date: 2025. 11. 07. 10:13

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The Hungarian Competition Authority (GVH) has closed the competition supervision proceedings initiated against two Hungarian subsidiaries of Coca-Cola, as a result of which Coca-Cola HBC Hungary Kft. has, among other things, undertaken to modify its standard contracts applied in relation to its hospitality industry partners; The undertakings could significantly increase competition in the affected markets, the competition authority informed MTI on Friday.

The GVH recalled in its statement: in 2019, proceedings were initiated against Coca-Cola HBC Magyarország Kft. and Coca-Cola Magyarország Szolgáltató Kft., investigating whether the company would transfer its alleged dominant position in the carbonated soft drinks market to the markets for the sale of alcoholic beverage products and other, less popular, non-alcoholic beverage products.

The experts of the national competition authority conducted a detailed analysis. Data was requested not only from those subject to the proceedings, but also from their partners and competitors, and on-site research was also conducted on two occasions without prior notice.

According to the results of the investigation, Coca-Cola HBC uses different contracts with its catering industry partners for the individual product types concerned, and no connection is clearly visible in their wording. However, the GVH revealed that in the case of certain contract types, the discounts were presented in a way that could give the partners the impression that they absolutely had to distribute several types of soft drinks in order to obtain a given discount.

Competition concerns also arose regarding the company’s periodic promotions, especially in the case of discounts on mixed drinks. The GVH concluded that the terms and conditions of the discounts may have given the partners the impression that they had to purchase both the alcoholic and non-alcoholic beverage products used for mixing from Coca-Cola HBC.

During the GVH proceedings, Coca-Cola HBC undertook to supplement its model distribution contracts with explanatory and clarifying provisions, which would make it clear that the commercial terms and conditions of the contracts concluded for individual beverage product types, and in particular the levels of discounts, are not dependent on each other. The company is also amending its contracts for promotional discounts on mixed drinks to clearly indicate that it is not necessary to mix Coca-Cola HBC soft drinks with the alcoholic beverage to obtain the discount.

Coca-Cola HBC has also undertaken to organize regular internal training for its affected colleagues in order to ensure compliance with the commitments and general competition law principles.

The Competition Council of the GVH considered that Coca-Cola HBC had made substantive and forward-looking commitments that adequately address potentially concerning practices, and therefore accepted and made the company’s commitments mandatory, and closed the procedure without establishing a violation or lack thereof. Coca-Cola Hungary Service Provider Ltd. did not participate in the implementation of the investigated conduct, and the Competition Council terminated the proceedings against it.

The GVH emphasized in its statement: the commitments must be fully fulfilled in all cases, and the competition authority strictly monitors this in the framework of follow-up investigations.