The Jerusalem District Court has found former Shufersal Ltd. (TASE:SAE) CEO Effie Rosenhaus, Deputy VP commerce and marketing Eli Gidor, and the chain itself guilty of Antitrust Law offenses. These include four offenses of attempting to form cartels by removing products from the shelves of major suppliers - the main affair for which the defendants were charged - and violating the terms of the merger with Clubmarket
This was a precedent-setting conviction on offences of violating the terms of a merger and attempts to form a cartel in an affair that is considered a flagship case by the Israel Antitrust Authority.
At the same time the Judge Moshe Yoed Hacohen acquitted the defendant of all the charges relating to the second affair on the indictment the Rezit Marketing affair.
The Israel Antitrust Authority is likely to ask the court to impose a prison sentence. The maximum punishment by law for the offenses is five years imprisonment for the "aggravating circumstances" that the Antitrust Authority sees in this case. The Antitrust Authority feels that competition has been significantly harmed by the affair, among other reasons because of Rosenhaus's standing and influence.
"Globes" revelations led to investigation
The charges in this case followed an article by "Globes" in December 2008. "Globes" exposed how Shufersal took leading brands off its shelves because the products were being sold in a major rival chain Mega at huge discounts. The products were removed from the shelves to punish and pressure suppliers to halt the Mega discounts.
The products removed from the shelves included Osem Investments Ltd. (controlled by Nestl? SA (SWX:NESN)) (TASE: OSEM) Nescafe Red Mug coffee, Wissotzky's Ice Tea, PriGat juice cartons, and Neviot mineral water six-packs.
The day after "Globes" article the Israel Antitrust Authority opened an investigation of the matter.
Published by Globes [online], Israel business news - www.globes-online.com - on December 23, 2013
© Copyright of Globes Publisher Itonut (1983) Ltd. 2013