Hasty approval of beer mergers: Marin Institute warns of adverse consequences

Marin InstituteOct 13 2009

Watchdog Calls for Investigation of Hasty Beer Mergers

Marin Institute, the alcohol industry watchdog, released a report today criticizing the hasty approval of two beer mergers that left 80 percent of the United States beer market in the hands of two foreign companies -- MillerCoors and Anheuser-Busch InBev. Big Beer Duopoly: A Primer for Policymakers and Regulators describes the drastic shift in U.S. beer market ownership to this powerful duo of global corporations. The report warns of potential adverse consequences to public health, public policy, and to the state-controlled three-tier system of alcohol distribution. Marin Institute called upon the Obama Administration to investigate the mergers hastily approved at the end of the Bush administration.

"America now has a Big Beer Duopoly, controlled by two global corporations whose sole interest is increasing profits at the expense of public health, jobs, and the three-tier system of alcohol regulation," stated Charisse Ma Lebron, corporate responsibility and advocacy manager at Marin Institute and lead author of the report. "We are troubled that in its rush to approve these mega mergers, the Department of Justice put beer profits above the public interest."

Among the report's findings are: 1) the MillerCoors joint venture approval was rapidly completed in approximately eight months, while the Anheuser-Busch InBev (ABI) merger was thrust through in only five; 2) shareholder democratic rights are significantly diminished as corporate control has shifted to Brussels for ABI and London for MillerCoors; 3) the power of the duopoly poses great threats to the already weakened three-tier regulatory system where distributors buffer large alcohol manufacturing corporations from retailers.

To counter the influence of Big Beer, Marin Institute recommends that federal antitrust review criteria for alcohol corporations should be more comprehensive, emphasizing public health and safety over low prices. The organization also recommends curbing the alcohol industry's undue political influence, protecting and strengthening the distributor tier of the state-based alcohol regulatory system, and raising federal alcohol taxes to charge for the harm of alcohol to society.

"The historic mergers of MillerCoors and ABI were rubber stamped by the federal government," said Bruce Lee Livingston, executive director of Marin Institute. "Because beer is the most widely used drug in America, the federal criteria for approving a foreign takeover of this industry should not be to lower the price of a six pack," he added. "We call on President Obama to have a real Beer Summit where ABI CEO Carlos Brito and MillerCoors CEO Leo Kiely each explain why the health of Americans and the economic survival of brewery workers and distributors are taking a back seat to Big Beer profits."