Challenge to Breeo Foods takeover 'damaging' the Irish food industry

THE COMPETITION Authority decision to appeal the High Court decision on the takeover by Kerry Group of Breeo Foods to the Supreme Court, is damaging the Irish food industry, it was claimed yesterday.

An open letter to Tánaiste Mary Coughlan from the IFA president Pádraig Walshe expressed his dismay at the action of the authority and called on her to intervene.

“The sale of Breeo by Dairygold/ Reox to Kerry was first agreed in March 2008 and has already been held up by the Competition Authority for 13 months. Now there is the prospect of further lengthy legal delays as a result of the authority’s appeal to the Supreme Court,” the letter stated.

“It is no exaggeration to say that this latest legal challenge by the Competition Authority to the Breeo sale is damaging the interests of the Irish food industry and its farmer suppliers at a time when the farming and food sector is already under huge pressure.

“I am therefore calling on you to consider seriously your responsibilities towards the agri-food industry and to intervene with the authority with a view to having the appeal dropped. This would also avoid the further waste of public funds on legal costs in pursuing a discredited position.”

He said the companies were now being held in a legal stranglehold over theoretical points of competition law that were “plainly kicked out” by the High Court judgment of Mr Justice John Cooke, who was very experienced in competition matters.

“His judgment rubbished the authority’s case that competition would be reduced and found compelling evidence that retailers, as a matter of ‘invariable policy’, resisted and delayed all attempts by suppliers to secure price increases,” the letter continued.

“The reality, Tánaiste, is well understood in the agri-food industry: retailers block well-justified price rises and extract unjustified margins for themselves, at the expense of both farmers and food processors. The Competition Authority resolutely ignores such abuses by retailers of their dominant position,” Mr Walsh said.