Controversial 2001 merger had monopoly implications. Announcement violates competition agreement.
TEL AVIV, Israel, July 22, 2021 /PRNewswire/ -- Advocate Dror Strum, former Israeli Antitrust Commissioner, has informed the Israeli Competition Authority that Ben & Jerry's announcement is a blunt violation of the terms included in the controversial merger approval decision of 2001 between Unilever Global and Ben & Jerry's. Violation of these merger decision terms is considered a grave violation of Israel Competition Law and hold the same status as a legal decree.
Dror Strum was the Head of the Competition Authority and the Antitrust Commissioner that approved the merger 20 years ago.
In his letter to Michal Halperin, the current head of the Israeli Competition Authority, Strum explained that acquisition of Ben & Jerry's Global by Unilever Global in 2001 raised significant difficulties in Israel. Unilever already controlled a dominant domestic ice cream company (Strauss Ice Creams Ltd) and therefore a merger with Ben & Jerry's would have strengthened Unilever's monopoly in the country.
Strum's letter said it was for that reason that the statutory decision to approve the merger included restrictive conditions under which Unilever was obligated to maintain a complete separation between Ben & Jerry's Global and Ben & Jerry's Israel licensee, and not to restrict or harm in any manner the independent licensee.
The terms specifically stated that "Unilever and Strauss Ice Cream and Ben & Jerry's agreement said they would not take any action that may interfere with the franchisee's activities in the country." Strum added, "as long as Unilever wants to continue to sell ice cream in Israel, it must continue to sell Ben & Jerry's in Israel and in all its areas.
Strum concluded his letter saying therefore it is prohibited to limit the license (through limiting sales of ice cream), let alone terminate the contract with the licensee in Israel without the Israeli Competition Authority's approval.
Strum said, the decision to reduce sales "is illegal, contrary to the conditions, and has devastating and immediate consequences for the licensee in Israel." Strum has sent a written notice to Ben & Jerry's Global, warning them they are violating the Israeli Competition Law and the terms of the merger.
