Heineken will have to pay a fine of HUF 15 million for narrowing the range of beer selection on the Hungarian market. Heineken will also have to set up a compliance programme with its HORECA partners to consciously avoid clauses that encourage exclusivity.
Budapest, 18 September 2023 - The Hungarian Competition Authority (GVH) has ordered Heineken to implement an internal compliance programme for all of its HORECA partners in Hungary and has imposed a HUF 15 million fine on the Dutch-owned multinational beer company, based on the size of its business relationship (with a single selected restaurant) under investigation. The GVH's investigation revealed that Heineken had, despite the legal prohibition, established an almost exclusive supplier cooperation with a restaurant in the capital.
At the beginning of 2022, the GVH launched five simultaneous proceedings to enforce the trade regulation, known in the press as the "beer law", introduced by the legislator two years ago to expand the choice of drinks and curb the exclusivity agreements that are common in the sector. Investigations into two fast-food chains, Burger King and KFC, were closed at the end of last year, finding that both companies had breached the new rules. The investigation concerning Heineken was the first of the parallel investigations against the big three brewers to be concluded.
An audit into the commercial relationship between Heineken and a restaurant in the capital revealed that the Dutch-owned beer company had established a partnership with the restaurant on terms that encouraged it to source almost all of its beer from Heineken. By doing so, the companies violated the new Articles of the trade regulation by limiting consumer choice and preventing other beer producers from competing.
The Competition Council of the GVH also took into account that Heineken is a repeat offender in view of a previous failure to comply, and that the conduct under investigation was specifically aimed at circumventing the regulation designed to facilitate the expansion of smaller competitors.
Taking all the aforementioned into account – based on the turnover of the only restaurant investigated – Heineken Hungária Sörgyárak Zrt. received a fine of HUF 15 million for the infringement. Furthermore, the Competition Council of the GVH prohibited the brewer from continuing the infringing conduct and ordered the brewer to establish an internal compliance programme to ensure that its business terms do not encourage restaurants to exceed the legal barriers (either directly or indirectly). The compliance programme imposed by the GVH will apply to all catering outlets that have a commercial relationship with the Dutch-owned brewer and is therefore expected to have an impact on the whole market.
Instead of imposing a fine, the authority issued a warning to Woda Bt, the operator of the restaurant involved in the case, in view of its minor role in the infringement, among other things. However, the GVH also ordered the small Budapest-based company to establish internal procedures to ensure compliance with competition law and to prevent infringements.
Case number: VJ/51/2021.
GVH Public Service Communications and International Section
Further information:
Bálint Horváth, Head of Communication +36 20 238 6939
Katalin Gondolovics, Spokesperson +36 30 603 1170