Japan’s Fair Trade Commission (FTC) has issued a formal warning to three of the country’s largest beer wholesalers who are under suspicion of selling their products at prices lower than cost. The warning states that they are in violation of Antimonopoly Laws in selling their beer to Aeon Co., a supermarket chain based in Japan’s Chiba Prefecture, at prices seen as too low for competition. Beer makers began cutting their rebates in 2005, and that is when it is suspected the pricing violations began.
The three wholesalers named, all from Tokyo, are Mitsubishi Shokuhin Co., Nihon Shurui Hanbai Co., and Itochu-Shokuhin Co. The FTC has also said that it suspects four beer breweries, as well as Aeon, of encouraging the pricing at lower than cost, a practice known as “dumping,” and has made a rare official request for them to begin conducting their business at fair prices. FTC warnings are seen as an administrative counsel for when the institution doesn’t have clear evidence, but is certain of its suspicions.
Sources say that the three wholesaler began dumping by 2009 at the latest. The FTC is against the practice as it directly hurts smaller and local liquor stores that try to operate their business in areas near Aeon locations. The dumping practice was heavily focused on the beer market, as that is the best-selling alcoholic beverage, and it is understood that the wholesalers made up for their losses on beer sales by increasing the wholesale prices on liquor and other alcoholic beverages.
[via Sacramento Bee]