Cofece investigates Walmart for price fixing

The Federal Commission on Economic Competition (Cofece) has summoned Walmart Mexico to investigate possible vertical price fixing or other monopolistic practices in the supply and distribution market for consumer goods.

Cofece said it had “called out the company” and Reuters confirmed it was the supermarket giant.

A source familiar with the situation said that Wal-Mart de México (Walmex) received notification on Friday that it was facing administrative procedure after a three-year investigation carried out CoffeeRelated to wholesale supply and distribution of consumer goodsas well as its retail marketing.

“The company is reviewing the notice and has 45 working days to present arguments and evidence,” the source told Reuters, adding that he was confident the company acted legally to ensure good prices and supplies of products.

The notification covered the supply, wholesale and distribution of consumer goods.

Company led the losses in the Mexican stock index on Monday, the company’s shares fell 5.20%.

Analysts warned the stock could experience some short-term volatility due to uncertainty about the potential impact on operations, which the company said it could not yet estimate.

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The company will now have the opportunity to defend itself in legal proceedings against the findings.”probable vertical price fixing and/or other relatively monopolistic practices“This is stated in a statement from Cofece.

Such violations may result in a fine of up to 8% of a company’s annual income in Mexico.

Cofece said the food and beverage sector is a priority for monitor anti-competitive behaviorand noted that Mexican families spend more than half of their income on consumer goods.

Walmex is the largest supermarket chain in the country, with 2,890 stores.

(Reuters).

Source: Aristegui Noticias

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