Coke restates strong opposition to French soda tax that 'stigmatizes our products and category'

10-Oct-2014 - Last updated on 13-Oct-2014 at 09:36 GMT

Buvez Coca-Cola? Seems that you're drinking quite a lot more, if you're French (O.Taillon/Flickr)

France’s largest soft drinks firms including Coke and Pepsi have committed to cutting sugar in added sugar soft drinks by an average of 5% in 2015, but the former tells us it still opposes a soda tax that 'unfairly targets and stigmatizes our products and category'.

Trade body Syndicat National des Boissons Rafraichissantes (SNBR) said that Coca-Cola Services France, Coca-Cola Enterprises, Orangina-Schweppes France, PepsiCo France and Refresco France (who together produce 80% of French soft drinks volumes) had all committed to the cut.

They have signed an accord with the French Agriculture ministry to put in place three ‘levers of action’ within the framework of the Programme National Pour L’Alimentation.

Lowering the average amount of sugar in non-alcoholic soft drinks (excluding sugars naturally present in fruits) by 2015. N.B. The wording of the pledge ‘a l’horizon’ 2015 is a little vague.
A commitment to stop advertising on the internet and TV during times when 35%+ of the audience is composed of children aged 12 and under.
Reducing the environmental impact of production and commercial activities by 2020.

On this third pledge, the SNBR said in a statement that producing one liter of soft drink required, on average, two liters of water.

Water reduction pledge should save 600m per year

“In signing this collective accord, these SNBR members have committed to reducing their water usage by 15%, which represents a saving of 600m liters of water per year,” the SNBR said.

This commitment also imposes an rPET usage goal of 25% in PET bottles – which the SNBR says many companies have already surpassed, while industry has also pledged to help hit a government packaging recycling rate of 75% by providing consumers with on-pack instructions.

The measures come against the backdrop of public health pressure in France to cut soft drink consumption levels, as per capita consumption surges.

Dorothée de Montgolfier, senior manager, external communication, CCE, told BeverageDaily.com today: "We have spent the last few years successfully working with our customers to overcome the challenges resulting from the increased excise tax in France and continue to be optimistic about the medium to long-term growth prospects in France. However, we have consistently stated that we are firmly opposed to discriminatory taxes that unfairly target and stigmatize our products and category."Industry continues to lobby against a January 2012 ‘soda tax’ of 7 cents/liter for soft drinks with added sugar and artificial sweeteners – which it says meant price rises of 6.3% for consumers that year.

‘France has been our growth engine’: Coca-Cola EnterprisesSlide from CCE CEO John Brock's presentation at Barclays Back to School Conference, Boston, September 3.

But despite the imposition of this measure – the like of which PepsiCo CEO Indra Nooyi attacked yesterday as discriminatory – Coca-Cola Enterprises boss John Brock recently described France as our “growth engine”.

“France has been our growth engine for the last 10 years, we’ve doubled per caps over the past 10 years,” he told delegates at the Barclays Back to School conference in Boston on September 3.

“The sparkling segment is now the No.1 retail segment in France – 10 years ago it was down round about No.8.”

And despite tense relations with retailers (whose margins shrunk) after the soda tax – which CCE fought hard – was imposed, Brock said relationships were strong again and margins were up again.

“We had an excellent H1 in France. It remains our growth engine, in my opinion, if you compare all our various growth markets, over the next few years,” he added.