Distell Limited v Anheuser-Busch Inbev SA-NV and Another (LM211Jan16/OTH172Sep18) [2020] ZACT 7 (17 February 2020)

Distell Limited v Anheuser-Busch Inbev SA-NV and Another (LM211Jan16/OTH172Sep18) [2020] ZACT 7 (17 February 2020)

The Tribunal found that 'ambient space' in clause 7.2 of the merger conditions refers only to storage and display space for products, not to advertising or branding space. Therefore, AB InBev's exclusive branding agreements with outlets did not breach the conditions. Regarding exclusive pouring rights at stadia, the Tribunal held that stadia are included in the definition of 'outlet' for the purposes of the conditions, contrary to the Commission's interpretation. However, the Tribunal could not grant a declaratory order on whether AB InBev's agreements at stadia breached the conditions, as it lacked sufficient evidence on whether these agreements constituted sponsored events exempted by...

Citation
[2020] ZACT 7
Parties
Applicant: Distell Limited; Respondent: Anheuser-Busch InBev SA/NV; Respondent: Competition Commission of South Africa
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
17 February 2020
Case Number
LM211Jan16/OTH172Sep18
Procedural Posture
Review Application / Order and Reasons Following Hearing
Outcome
Application for a declarator that AB InBev breached merger conditions dismissed; Commission's decision not to invoke Rule 39 proceedings reviewed and set aside; Commission ordered to investigate exclusive pouring rights agreements at stadia within 120 days.
Judges
Yasmin Carrim, Thando Vilakazi, Imraan Valodia
Legal Topics
Merger Conditions, Exclusive Pouring Rights, Definition of Outlet, Review of Administrative Decision, Rule 39 Proceedings
Competition Law Commercial and Corporate Merger Conditions Exclusive Pouring Rights Definition of Outlet Review of Administrative Decision Rule 39 Proceedings

Case Brief

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Parties

Distell Limited

Applicant

Anheuser-Busch InBev SA/NV

Respondent

Competition Commission of South Africa

Respondent

Procedural Posture

Review Application / Order and Reasons Following Hearing

Legal Issues

  1. 1 Whether AB InBev's exclusive branding agreements with outlets breached merger conditions, specifically clause 7.2.
  2. 2 Whether AB InBev's exclusive pouring rights agreements at stadia breached merger conditions, specifically clause 7.2.
  3. 3 Whether the Competition Commission's decision not to invoke Rule 39 proceedings was rational and should be reviewed and set aside.

Ratio Decidendi

The Tribunal found that 'ambient space' in clause 7.2 of the merger conditions refers only to storage and display space for products, not to advertising or branding space. Therefore, AB InBev's exclusive branding agreements with outlets did not breach the conditions. Regarding exclusive pouring rights at stadia, the Tribunal held that stadia are included in the definition of 'outlet' for the purposes of the conditions, contrary to the Commission's interpretation. However, the Tribunal could not grant a declaratory order on whether AB InBev's agreements at stadia breached the conditions, as it lacked sufficient evidence on whether these agreements constituted sponsored events exempted by...

Court Disposition

Application for a declarator that AB InBev breached merger conditions dismissed; Commission's decision not to invoke Rule 39 proceedings reviewed and set aside; Commission ordered to investigate exclusive pouring rights agreements at stadia within 120 days.

Orders

  • The application for a declarator that AB InBev breached the conditions imposed on the merger under case number LM211Jan16 is dismissed.
  • The Commission's decision not to invoke proceedings established in Rule 39 of its rules based upon the complaint of Distell regarding exclusive pouring rights at stadia is reviewed and set aside.