Thursday, May 7, 2009
Posted by D. Daniel Sokol
Fei Deng (NERA), Adrian Emch (Sidley Austin) & Gregory Leonard (NERA) explain A Hard Landing in the Soft Drink Market —MOFCOM’s Veto of the Coca-Cola & Huiyuan Deal.
ABSTRACT: On March 18, 2009, China’s Ministry of Commerce (“MOFCOM”) issued its decision to block the proposed takeover by The Coca-Cola Company (“Coca-Cola”) of China Huiyuan Juice Group Limited (“Huiyuan”). This is the first time that MOFCOM has prohibited a transaction under the Anti-Monopoly Law (“AML”), in effect since August 1, 2008.
We will examine several interesting aspects of MOFCOM’s decision. In Section 2, we will discuss the insufficient degree of transparency which characterizes the Coca-Cola/Huiyuan and other cases. Section 3 will examine MOFCOM’s substantive reasoning in the prohibition decision, to the extent that the agency’s findings can be discerned. In Section 4, our focus will lie on the influx of policy objectives other than antitrust.