PepsiCo and Coca-Cola are under investigation by competition authorities in the United States over the way they set their selling prices. In Canada, the competition office cannot say if they do the same.
It is the Federal Trade Commission (FTC) that is pre-testing the dossier, reports online media Politico.
The two beverage giants may have broken a law that prohibits suppliers from offering lower prices to their major customers and lower prices to others, or offering lower prices to customers in a specific geographic market.
Known as the Robinson-Patman Act, this highly technical law aimed at ensuring healthy competition has not been used in the United States for at least 20 years.
But the new FTC boss, lawyer Lina Khan, 33, has tightened the antitrust rules since taking office last June.
Law enforcement has been too lax for decades, she said recently, allowing big companies to consolidate and find ways to undermine competition.
The FTC and PepsiCo declined to comment on the news. Coca-Cola said the company is “committed to fair and legal competition in the marketplace.”
Sources tell Politico that for at least a month, the FTC has been reaching out to major retailers, including Walmart, for data and other information on how they buy and price soft drinks.
According to Euromonitor International, Coke controls 43% of soft drink sales in the United States, while PepsiCo accounts for 23%.
Silence in Canada
This new poll is another sign of the Biden administration’s efforts to address concentration in the US economy and the power of big business.
Last year, the president unveiled a plan designed to bring more competition to America’s meat industry, which the White House says is dominated by a few big companies that are reaping the rewards.
Joe Biden has also said on numerous occasions that big tech companies like Google, Facebook, Amazon, Apple and Amazon hinder fair competition.
He also signed an executive order last July directing federal agencies to better enforce competition laws not just in technology, but also for drug companies, internet providers, insurers and airlines.
In Canada, the law requires the competition authority to keep its work confidential, including the conduct of its investigations.
“We therefore cannot say whether we are investigating this issue,” we were told Thursday when asked if Pepsi and Coke were also under investigation in the country.
Justin Trudeau’s administration has not, like Washington, made the competition one of its hobbyhorses. However, Canada is dominated by oligopolies in several sectors, including food, transportation, telecommunications and financial services.