The Israel Competition Authority announced today that Yochananof marketing chain owner and CEO Eitan Yochananof, his deputy Elad Harazi and manager of the Super Bareket supermarket chain Ephraim Tshuva are being given a hearing before an indictment is filed against them on suspicion of cartel arrangements. The Yochananof chain itself will also be given a hearing.
In addition the Israel Competition Authority also announced that the CEO and owner of the Victory supermarket chain Eyal Ravid is also suspected of additional offenses of cartel arrangements, after public comments that he made.
Victory and Yochananof have notified the Tel Aviv Stock Exchange (TASE) about the announcement of the Israel Competition Authority.
Ravid, who has been investigated six times by the Competition Authority in recent years, is suspected of making cartel arrangements with Harazi, the deputy CEO of Yochananof, according to which they would not offer promotions to consumers while the market was stagnating, so that there would not be damage to their market share. This involved coordinating prices between the chains, so that the prices would not fall. Ravid and Harazi are suspected of cartel offenses, while Yochananof is suspected of offenses related to managerial responsibility.
A further allegation against Ravid is price fixing through suppliers and not directly. The law on the promotion of competition in the food industry prohibits retailers from interfering with the price to the consumer of another retailer. Section 6 of the law states that a retailer will not dictate to the supplier and will not interfere in the matter of the price to the consumer that another retailer charges for a commodity.
The Competition Authority suspects that Ravid allegedly coordinated with suppliers of other retailers, mainly Rami Levy and Yochananof, on price increases. In conversations intercepted by the Competition Authority, it emerged that Ravid asked suppliers to ensure that the prices do not rise. These included suppliers of Dr. Fisher, Beit Hashita and Schestowitz. The Competition Authority stresses that the companies are not suspects in this incident, since the ban is on the retailers.
This is the first time that the Competition Authority is carrying out criminal enforcement under the Food Law. Until today, the enforcement was conducted administratively by imposing fines.
Advs. Nati Simchony, Asaf Shubinsky and Assaf Klein acting for Ravid and Victory said, "We received the letter with the suspicions and the summons of the company and Mr. Ravid for a hearing at the Competition Authority. Our clients are convinced that there was no fault in their actions, and we believe that after we state our position at the hearing, the Authority will come to an informed decision that there is no reason to prosecute our client, and will order the closure of the case."
Presumption of innocence: There are only suspicions against Eitan Yochananof, Elad Harazi and Eyal Ravid and the Yochananof, Victory and Super Bareket chains and they have not been convicted of anything related to them and have the right of the presumption of innocence.
Published by Globes, Israel business news - en.globes.co.il - on June 19, 2024.
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