ACCC probes draught beer contracts

By James Atkinson

Australia's competition watchdog has confirmed it is conducting an enquiry into allegations of anti-competitive conduct by the major brewers in their tap contracts with pubs.

The ACCC this month wrote to brewers formally announcing the enquiry "to better understand supply conditions within the wholesale draught beer market in Australia to understand how certain conduct may be affecting competition".

A questionnaire attached to the letter asked brewers 15 questions including:

• Since 2007, has your company attempted to supply draught beer products to one or more venue and either been unsuccessful or dissatisfied with the available terms?
• What do you see as the key barriers you face in negotiating new supply contracts and/or expansion of existing contracts to supply draught beer to wholesale customers?

Craft Beer Industry Association acting chair Dave Bonighton said: "We are aware that the ACCC is conducting the enquiry into the draught beer market, which is an area of concern for many of our members."

"We have contacted the ACCC and offered to assist them in any way possible. We would encourage our members to assist fully with the enquiry so that all sides of the issue may be heard."

Majors more aggressive than ever: Coopers

Coopers chairman Glenn Cooper told TheShout: "It has certainly been a more difficult playing arena for draught beer in the last two years as the two major breweries have upped the ante to gain a larger share of taps – it's been far more aggressive than I've seen in the past."

Another brewer commented that many of the tap contracts pursued by Carlton & United Breweries (CUB) and Lion would be illegal in the USA, where craft beer is projected to represent nearly 15 per cent of the market by 2020 at current growth rates.

"That's why the craft beer market in the US gets a shot, because you're not allowed to pay extra money to secure taps," he told TheShout.

The exclusion of named products and entire categories such as 'Pale Ale' or 'Summer Lager' is a key concern for the smaller players.

But Carlton & United Breweries spokesman Jeremy Griffith said no-one is excluded from CUB's tap contracts.

"The vast majority of pubs purchase beer from a number of breweries," he said.

"As far as we are aware, all brewers, including CUB, offer some form of incentive to stock their products such volume rebates, and maintenance of taps and equipment."

A Lion spokeswoman said: "Lion can confirm it is cooperating fully with the ACCC in relation to its enquiries into the draught beer market, however it would be inappropriate for us to make further comment at this time."

The ACCC confirmed the enquiry was underway, but declined to comment further.