Court orders San Miguel Corp. to pay rival P130M

MANILA, Philippines - A Marikina regional trial court has ordered San Miguel Corp. to pay rival Asia Brewery, Inc. some P130 million after it was found to have engaged in unfair trade practices. Southeast Asia’s largest food and beverage conglomerate was found to have hoarded and illegally removed from circulation beer bottles, plastic crates and other trade goods of the Lucio Tan-owned beer company. "By withdrawing the [Asia Brewery] bottles from circulation, San Miguel effectively disrupted [its rival’s] marketing and distribution system and deprived it of the profits it could have gained," Judge Alice C. Gutierrez said in her 47-page decision. The trial court said Asia Brewery had no choice but to cough up more money to replace the lost goods. In a statement, San Miguel said it would appeal the court ruling. Asia Brewery sued San Miguel for damages and sought to recover its beer bottles in 1997 after receiving information that its rival had, several times in the past, removed its bottles from the market. In fact, a different trial court had ordered a raid of several San Miguel warehouses to confirm the allegations. The raid yielded more than 1.6 million bottles of Asia Brewery products like Beer na Beer, Carlsberg, Manila Beer, Colt 45, Lone Star and Budweiser. Asia Brewery also presented several witnesses, among them former sales agents of San Miguel, who alleged that the latter had sought "total annihilation and destruction of the enemy." The tactics included the buying or pulling out Asia Brewery’s products from the market. San Miguel earlier claimed its bottles were similar to those of its rival. It also said it had a swap deal allowing it to receive and safely keep Asia Brewery-marked bottles. But the trial court said San Miguel possessed bottles outside the swap agreement. "The court is convinced that [Asia Brewery], through its witnesses and documentary evidence, was able to establish that [San Miguel had] engaged in systematic schemes to pull out the beer products from stores and other trade outlets." San Miguel was ordered to pay P14.29 million to replace the bottles, P112.89 million for profits lost, P5 million in exemplary damages and P350,000 in litigation expenses. — BusinessWorld