Refusal to trade and group boycott in the distribution of newspapers and magazines

Mexico


Unide Voceadores, Expendedores y Repartidores de Periicos, Revistas y Similares del Puerto de Veracruz, Unide Voceadores de Veracruz, and Jose Espdola Gez

On August 26, 1994, the Commission began an ex officio investigation into alleged relative monopolistic practices by two newspaper and magazine salesmen unions (UVER and UVV) and an exclusive magazine distributor of a publishing company (Intermex) in the city of Veracruz. The investigation began after consideration of the facts reported to the Commission by the General Secretary of a third regional salesmen union (UUVP).

Pursuant to article 3, both the unions and the distributor are subject to the terms of the law. Unions are a form of participation in economic activities, in that they govern the commercial activities of their members. Such associations therefore have the status of economic agents. The same is true of the distributor, whose activities have a commercial nature. The following elements of the evidence provided by the UUVP's leader are particularly noteworthy:

In spite of the distributor's refusal to sell to non-members of the UVER and the UVV and, in particular, to former members expelled therefrom, they were able to secure partial supplies from the Intermex agency in Jalapa, Veracruz. In spite of the greater costs, this option allowed them to survive on the market.

The investigation performed by the Commission detected the following relative monopolistic practices:

Pursuant to articles 8 and 10, of the Federal Economic Competition Law, both practices constitute infractions. The Commission determined the relevant market of these practices to be that of the sale, distribution, and marketing of intermediate wholesale magazines in the city of Veracruz. The restriction of the geographical area was based on the fact that the contract between the distributor and Intermex gave him exclusive rights in that locality and that obtaining regular supplies from Jalapa was not viable because of the costs and risks involved.

Furthermore, the Commission ruled that UVER and UVV held substantial power in that market, since most magazines were sold through their channels and the two unions were able to influence the distributor's activities. Similarly, Intermex had substantial power over the market as a result of his exclusive rights and of the existence of high costs and risks for customers willing to obtain supplies from alternative cities.

In order to eliminate the relative monopolistic practices described, the Commission's Plenum resolved:

To order UVER and UVV:

To order Intermex: