The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

A food retailer yesterday said the long-standing distribution contracts that many Bahamian wholesalers have with global brands could frustrate the Government’s plans to introduce more competition.

Philip Beneby, the Retail Grocers Association (RGA) president, told Tribune Business the Davis administration’s warnings that it will seek to introduce more competition into the food distribution industry in a bid to reduce prices will face obstacles from wholesale agreements have been in place for more than 60 years.

And he pointed out that there is “nothing” the Government can do to stop a foreign supplier from selecting its Bahamian distributor of choice, otherwise it could be accused of restraint of trade and unlawful interference in private commercial relationships.

Mr Beneby was responding to comments by Michael Halkitis, minister for economic affairs, who recently signalled that the Government is eyeing laws, policies and regulations to facilitate greater competition in the food distribution industry as a means to combat inflation and reduce consumer prices.

“Now, we are looking at the draft competition policy and draft competition legislation that looks at market dominance, and looks at people involved in wholesale and retail,” Mr Halkitis said, “and the question is, is it actually fair and how do we impact competition in that way? We are promoting more local production because most of the food that we consume is imported, and so we’re impacted by that imported inflation.”

Mr Beneby, though, said: “You have companies like Asa H Pritchard, who are the agents for Hellman’s, along with some of the other products like Libby’s and Chef Boyarde, as well as the sole agents for Mahatma Rice. Then you have the D’Albenas Agency, who are the agents for Kraft, Johnson and Johnson, so I don’t know how he’s going to break that.

“What Mr Halkitis may be saying is that it is something they are thinking of, but they would have to sit down and speak with those wholesalers, in particular, if that’s what they are looking at. A lack of consultation is part of the reason why the Government doesn’t get it right sometimes. They have to talk to the people who are the agents because they have been doing this since before some of them were born.

“Because before Mr Halkitis was born, Asa H Pritchard had the distributorship for Hellman’s and Mahatma Rice and Libby’s and much more, and the same thing with the D’Albenas agency with their products. This won’t be something that will be easy for the Government to do.”

The Bahamas has long lacked an antitrust regulatory regime that promotes competition and safeguards the interests of consumers. Implementing competition laws and regulations was among the obligations this nation was supposed to fulfill when it signed on to the Economic Partnership Agreement (EPA) with the European Union (EU) in 2009, but almost 15 years later it has thus far failed to do so.

A draft competition law was upgraded under the Minnis administration, when the Government was looking at restarting the accession process for full membership in the World Trade Organisation (WTO). However, this effort fizzled and ultimately came to nothing, with competition legislation again placed ‘on the shelf’ in the Ministry of Economic Affairs.