Coca-Cola changes sales practices to appease EU

Coca-Cola yesterday agreed to alter its sales practices in some European markets, an offer likely to bring to an end a five-year investigation by the European Commission into whether the soft drinks giant was stifling retail competition.

The expected settlement could also help dispel suggestions that Mr Mario Monti, the European Union's competition commissioner, has been particularly reluctant to compromise with American companies following bruising battles with General Electric and Microsoft.

The EU antitrust body's investigation was triggered by a complaint from PepsiCo and started with an unannounced inspection of Coca-Cola's European headquarters in 1999. The probe focused on whether Coca-Cola offered incentives to retailers and used discount schemes to bar rivals from supermarket shelves, vending machines, coolers and bar drinks dispensers.

While the Commission came close to issuing formal antitrust charges earlier this year, some EU officials always appeared sceptical about whether the long-running case was an efficient use of the Commission's resources - particularly because initial charges involving Coke's German operations would probably have been followed by charges related to other jurisdictions. Furthermore, there were doubts in Brussels about becoming surrogates in a classic confrontation between the two largest cola producers.

The Commission yesterday said it had started a so-called "market testing" period of a few days to give competitors a chance to comment on the terms of the proposed settlement. If there are no significant objections from Pepsi and others, the case could be formally closed by the end of the year. - (Financial Times Service)