BAT ceases agreements after ICCC concern

British American Tobacco PNG Limited (BAT) has volunteered to cease enforcing exclusive clauses in three agreements with on-sellers and distributors of its tobacco products.

This follows concerns raised by the independent Consumer and Competition Commission (ICCC).

In a statement the ICCC said BAT voluntarily ceased enforcing exclusive clauses in its existing Formal Retail Agreement, Non-Direct Wholesale Agreement and Wholesale Vendor Agreement.

This comes after the Commission raised competition concerns on how these exclusivity clauses were administered.

The three agreements between BAT and its sellers and distributors aimed to eliminate or minimize the importation and sale of illicit tobacco products in PNG.

ICCC CEO, Paulus Ain, said while they appreciated this, there were certain exclusivity clauses in those agreements, which were potentially anti-competitive in nature.

Ain said BAT has cooperated well with the ICCC to address those concerns and will inform its customers not to enforce the exclusivity clauses in the existing Agreements replacing these with new trading terms in close collaboration with the ICCC.

“We would like to encourage other corporate businesses to follow BAT’s lead. Wholesalers, retailers and vendors of others goods and services are advised and encourage to work with the ICCC to promote competition in the economy; and to engage in conduct or arrangements which may raise concerns under the Independent Consumer and Competition Commission Act 2002. If you are unsure, please consult us and we would be pleased to assist so that together we promote competition and hence, the growth of our economy,” said Ain.

Cedric Patjole