Unilever to appeal €60m Italian competition fine
A fragmented market?
Unilever's ice cream brands lead the Italian ice cream market in terms of market share, according to data from Canadean. Cornetto is the largest brand in the take home and bulk ice cream category while Magnum is the largest brand in the impulse single-serve category.
However, Canadean researchers note, artisanal ice cream "dominates" volume consumption in the country.
Take-home and bulk ice cream accounted for highest off-trade and artisanal ice cream accounted for highest on-trade volume share for the 2010-15 reporting period, Canadean revealed.
The researchers also noted that in the impulse or single-serve category – the area that Unilever is accused of breaching competition regulations in – there is higher private label penetration compared to other ice cream categories.
Unilever has said that it will appeal a €60m fine imposed by Italy’s competition watchdog over alleged “abuse” of its dominant position in the country’s ice cream market.
The Italian antitrust authority, the AGCM, accused Unilever of using its dominant position through the Aglida brand to exclude competition and “hinder growth” in single-serve ice cream.
Unilever Italy rejected the accusations and confirmed it will appeal the decision.
“The company firmly rejects this conclusion which, in the company’s opinion, has been imposed as a result of several errors of assessment by the Authority and thus announces its intention to appeal as appropriate,” Unilever said in a statement.
“Out of home ice cream is a highly competitive market, where craft and industrial products, whether scooped or packaged, compete for consumer attention in a fragmented environment that is unmatched in Europe.“
Exclusive product clauses?
The AGCM commenced its investigation into competition in the ice cream sector in 2013 after receiving a complaint from Rimini-based ice cream maker La Bomba.
According to the local group, Unilever struck deals with resort operators, bars and campsites in in Rimini to exclusively stock Unilever brands.
Concluding the investigation, the AGCM said Unilever adopted an “exclusionary strategy” that included “a wide use” of exclusive product clauses and other strategies to secure exclusivity of supply.
These practices hindered competition in the market and caused “substantial prejudice” to freedom of choice, the regulator insisted.
Responding to the findings, Unilever insisted that it cooperated with the authorities in their investigation, providing “extensive” evidence to demonstrate the fairness of its conduct.
“During the investigation, Unilever has aimed at offering the maximum collaboration to the Antitrust Authority at all times, by presenting extensive documentation to understand market dynamics and the fairness of its conduct that, as we believe, does not constitute a breach of the competition rules in the out-of-home ice-cream segment.
“Unilever's commitment to a capillary distribution in the out-of-home segment responds to the need to meet the demand, also in terms of proximity, from the consumers who have shown their appreciation of our products."
