The Ministry of Economy and Industry takes an unprecedented step in the fight against the cost of living: The Ministry of Economy and Industry today (Monday) sent a notice to Nir Levinger, CEO of the Central Soft Drinks Company Ltd. (Coca-Cola Israel), of its intention to place the company's products under supervision, along with a demand to receive data that will reveal "why the prices of 'Coca-Cola' in Israel are among the highest in the world.".
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As you may recall, Minister Barkat opened a front against Coca-Cola, after the Central Beverage Company announced a price increase across all of its products - from Coca-Cola to beer - at a rate of approximately 6.71% of the total.
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The Ministry of Economy is demanding that Coca-Cola present data that the company has hidden until now. "We have indications that cola products in Israel are the most expensive in the world, we are considering placing cola products under supervision," the ministry said.
Minister of Economy and Industry Nir Barkat: "The monopolies in Israel have become accustomed to raising prices without batting an eyelid. The only thing that guides them is monopolistic profit at the expense of the Israeli consumer. The Ministry of Economy under my leadership will act with all the tools at our disposal to prevent excessive and unjustified price increases - which make life difficult for Israeli citizens.".
""The Coca-Cola Israel Company is raising prices unjustly, despite the decline in input prices worldwide and despite the abolition of the tax on sugary drinks. The days when Israeli citizens would pay much more than the rest of the world are over, just because they can be charged without limit and without control. Israeli citizens are not anyone's cash cow, and we intend to put an end to the celebration on their backs.".
Dr. Jonathan Bezalel, Head of the Budget Division and the Price Supervisor at the Ministry of Economy and Industry, sent the notice to the company by virtue of his authority in accordance with Sections 6 and 31 of the Consumer and Service Price Supervision Law, 5756-1996.
""Your company is a monopoly holder in the cola drinks market (regular and diet), in accordance with the announcement of the Competition Commissioner dated May 10, 1998, and has a monopoly in the aforementioned cola drinks market," Dr. Bezalel wrote to Coca-Cola Israel.
""From the information we have, it appears that the prices of the main cola products that you produce and market are the most expensive in the category. In a comparative examination of markets around the world, there are indications that cola products in Israel are the most expensive in the world. Recently, in the run-up to the abolition of taxation on sugary drinks, your company announced its intention to increase the prices of your products significantly, in a way that may affect the beverage sector in Israel as a whole.
""In light of the above and in accordance with Section 6 of the Control of Prices of Commodities and Services Law, 1996 (hereinafter - "the Control Law") and my authority under Section 31(a) of the Control Law, in order to examine the need for control of the prices of your products and the level of control, as required, you are required to forward to us within 21 days from the date of this letter the following data and documents: A. Audited financial statements of your company for the years 2018-2021. B. Financial statements for 2022. C. Trial balances adjusted for the financial statements for the years 2018-2022.".
The Price Supervisor at the Ministry of Economy and Industry also demanded that Coca-Cola Israel disclose production and sales volumes of cola products in Israel, product components and quantities per product, packaging and transportation costs, operating profit attributable to the cola drinks sector in your company for the years 2018 to 2022, and additional data.
