ANNEXURE B

Geneva Meeting on 7-Up Project

12^th October, 2001

1. CUTS organised an International Symposium on Competition Policy and Consumer Interest in Geneva on 12^th & 13^th October 2001. Among others, many of the members of PAC as well as partners of 7-Up project attended the meeting. CUTS utilised this opportunity to discuss about the progress and action plan of the project and organised a fringe meeting on 12^th evening. The following persons were present at the meeting:

Peter Holmes

Christian Rogg

Phil Evans

George Lipimile

Taimoon Stewart

Garth le Pere

David Ongolo

Malathy John

Pradeep S. Mehta

Mwamba Makasa

Olivia Jensen

Nitya Nanda

Susan Joekes of IDRC was also present in the meeting as an observer.

2. The agenda of the meeting was as follows:

I. Phase I report

·         Collection of additional information on Phase I – status, problems & further action

·         Revision of Phase I Country Reports - revised format & inclusion of 2^nd NRG meeting comments

II. Phase II Questionnaires

·        Status & Problems

·        Analysis & Further Actions

III. Action Plan & Time Schedule

·        1^st Case Study – Progress

·        Outlines for Case Studies

IV. NRG Meetings

·        Fixing of dates

·        Objectives & Agenda

·        Reporting Format

·        Selection of third case study

3. Three documents were used as background papers for the discussion. They were: (i) the Time Schedule for September-December 2001; (ii) The Draft Action Plan for Phase II and (iii) Minutes of the Meeting of CUTS 7-Up Team with Rakesh Basant held at Jaipur on 29^th September 2001. The outcome of the meeting is reported in brief as below:

4. None of the partners would have any problem in meeting the deadlines set out in the timetable apart from South Africa. Due to personnel problems, Garth felt that he would be able to get something in by end-Nov.

Status of Phase I report:

5. The additional information for Phase I has already been collected and sent to CUTS by the Sri Lankan partner. David informed that the same for Kenya has also been sent. However, Garth could not provide any specific deadline for it as he has to get a new researcher. He was requested to somehow get the additional information as it is not a difficult job and anybody can do it. This will ensure that Rakesh’s work is not held up because of lack of information.

6. The revised format for the Phase I country reports were discussed and there was agreement on the same. There are two documents that were circulated in the launch meeting, Rakesh’s think-piece and Nitya’s summary. These two documents will be merged/modified to produce a single report. Some quantitative comparisons will have to be carefully handled to deal with exchange-rate fluctuations etc. Rakesh will decide how to handle this.

7. There was a discussion on whether to produce one synthesis paper or a separate paper for each country. It was decided that both will be published.

8. There was a debate over whether to include some of the preliminary results of Phase II in the Phase 1 reports. It was suggested that if there were some interesting results from the survey, these could be included if the partners like. But the prevailing mood, by and large, was not in favour of this. Moreover, it might hold up the process of getting the Phase 1 reports finished.

9. Christian wanted to know when he would see the country reports. The circulation of the country reports needs to be put into the time-table.

10. Results from the first surveys conducted for Phase II are promising. In each country, 10-20 people filled out the questionnaire, representing a wide range of stakeholders including government, the CA, business, media etc.

Sri Lanka

11. For the international merger, Standard Chartered & Grindlays emerged as the most promising case study. Cadbury Schweppes does not operate in SL. Other case study options include shipping.

Zambia

12. Case study options: Cement (Lafarge-Chilanga)

The pharmaceutical case (SB-GW) was taken up in relation to tariff levels to be set by the government. SB market share was very low and below the threshold for consideration by the authority.

13. In Zambia, competition concerns are mainly in the manufacturing sectors rather than with “briefcase companies” (i.e. big brands). Abuse of market dominance pronounced in the cement and sugar sectors, maizemeal. In banking, it is very difficult to prove dominance.

14. In both Kenya and Zambia, bid-rigging is not dealt with by the Competition Authorities. Complaints are dealt with by the tender board or by the anti-corruption authorities. Anti-dumping is dealt with by trade officials.

15. Phil Evans reiterated the suggestion that he made in Goa that the partners prepare a report on the process part of the project (how the research was conducted, problems encountered and solutions found etc.)

Kenya

16. The following sectors/cases came up in response to the survey questions:

·         Bid-rigging: construction

·         Anti-dumping: pharmaceuticals, tobacco

·         UTP: banking

·         Cartels: poor awareness, GSK has been in the media because of rumours that they were closing down in Kenya

·         Abuse of dominance: banking (Barclays & Standard Chartered), pharmaceuticals

·         M&A: CCCS attempted acquisition by Subco of a domestically owned Coca Cola bottling plant. However, this is still under investigation and might be impossible to use as a case study. Cement as sectoral study is OK.

South Africa

17. Only useful questionnaire was the one filled by Menzi Simelane.

·         International cartel under investigation by the CA: soda ash

·         Sector case study: Cement

·         Merger case study: CCCS. The merger was allowed but with conditions.

2^nd NRG Meeting

18. The NRG meetings in Kenya and South Africa would be held 31^st October and 4^th November respectively. In Sri Lanka it would be held on 2^nd November. The date for Zambia would be decided once Mwamba is back to Lusaka. The suggested format for reporting the NRG meetings’ outcome was also discussed and everybody agreed to it. It was also agreed that the third case study would be selected on the recommendations of the 2^nd NRG meetings.

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