Walmart's Mexico unit to face anti-trust panel after three-year investigation
Reuters
Published Oct 06, 2023 07:53PM ET
Updated Oct 06, 2023 10:05PM ET
By Daina Beth Solomon
MEXICO CITY (Reuters) -Walmart's Mexico unit said on Friday it will face an anti-trust panel for alleged relative monopolistic practices related to the supply, wholesale distribution and marketing of consumer goods.
The allegations follow a three-year investigation by Mexico's antitrust regulator, Cofece, and the company now has 45 days to provide arguments and evidence in its defense.
Walmart (NYSE:WMT) de Mexico, known as Walmex, was first told in 2020 that it was under review for possible antitrust behavior.
"Walmex is confident that it has always acted in accordance with applicable law to ensure the best prices, quality and assortment to its clients," the company said in a statement, adding it could not yet predict any impact to its finances and operations.
Cofece declined to comment.
Specifics of the allegations were not immediately clear. In 2020, Cofece flagged concern about large retail chains imposing terms on their suppliers, saying such practices created risk for the smaller companies and could hit their finances.
The agency's commissioners will oversee a trial-like process, weighing the findings of its investigative unit against Walmex's defense.
If it determines Walmex has violated competition law, Cofece can impose a fine of up to 8% of the company's annual income in Mexico.
The retailer last year posted revenue of more than 819 billion pesos ($45 billion) from its operations in Mexico and Central America. It is due to report third-quarter results on Oct. 25.
Walmex is the biggest supermarket chain in Mexico with 2,890 locations and regularly outperforms local rivals.
The company is also in fierce competition with Amazon.com (NASDAQ:AMZN) as both retail giants scale up e-commerce operations in the country.
The research division of Mexican bank Banorte said Walmex shares could see some short-term volatility following the announcement due to uncertainty over the potential impact on its operations.
($1 = 18.1638 Mexican pesos)
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.