Chocolate, the free market battle ground
I’m a chocoholic. Can’t eat it as much as I used to. So, this bit of news by way of C & L caught my eye. I’ll let the article speak for it’s self.
As a result of a settlement with the Hershey’s Company, Let’s Buy British Imports, or L.B.B., agreed this week to stop importing all Cadbury’s chocolate made overseas. The company also agreed to halt imports on KitKat bars made in Britain; Toffee Crisps, which, because of their orange packaging, and yellow-lined brown script, too closely resemble Reese’s Peanut Butter Cups; Yorkie chocolate bars, which infringe on the York peppermint patty; and Ms. Perry’s beloved Maltesers.
Jeff Beckman, a representative for Hershey’s, said L.B.B. and others were importing products not intended for sale in the United States, infringing on its trademark and trade dress licensing. For example, Hershey’s has a licensing agreement to manufacture Cadbury’s chocolate in the United States with similar packaging used overseas, though with a different recipe.
“It is important for Hershey to protect its trademark rights and to prevent consumers from being confused or misled when they see a product name or product package that is confusingly similar to a Hershey name or trade dress,” Mr. Beckman said in an email.
It’s that different recipe that gets me regarding the “free market” and “competition”.
Chocolate in Britain has a higher fat content; the first ingredient listed on a British Cadbury’s Dairy Milk (plain milk chocolate) is milk. In an American-made Cadbury’s bar, the first ingredient is sugar.
American Cadbury bars also include PGPR and soy lecithin, both emulsifiers that reduce the viscosity of chocolate, giving it a longer shelf life. British Cadbury bars used vegetable fats and different emulsifiers.
Funny how this works now. In the past Japan pushed our auto industry into building better cars. You know, global economy, down with tariffs and all. So what do we call it when licensing agreements end up acting like tariffs? I wonder if Cadbury can file a claim in the world court for lost revenues? Well, they have a “license agreement” so I guess not. Though should we allow license agreements that basically act like a tariff or worse as in this case a complete shut out of the market? Well, I guess Cadbury is not completely shut out. We get to see their name on the wrapper.
What about the lose of money for the importer? How is the World Bank’s Tribunal system suppose to resolve the contest between importers and local producers? And, why would Cadbury sign such a thing? Are they just a holding company now so it’s money without working? Licensing fees, royalties and all that.
Where is my free choice in this? Hell, were is my choice at all? Is simply a name change and wrapping enough to suggest that I am actually buying a different product from Hersey? Am I buying from Hersey or Cadbury regarding monopoly practices?
With all these international corporate agreements, is the consumer really getting a choice? Remember when Sunbeam was sold? It was a big deal on the news. The purchaser said they only wanted the brand name.
Oh and TPP too.
So now we will have smuggling business in Chocolate bars. Of course the issue is the original license agreement that Cadbury et.al. signed with Hershey. Time to start a web site with the British chocolates and see if they can be shipped in by UPS.
Or better yet as coke has done in some cases, allow coke bottled in Mexico into the country in 6 oz bottles because it uses real sugar not HFCS.
Can you get non-US Cadbury in Canada?
Using different recipes for the “same” product in different countries is common. Nutella, for instance, uses some pretty different recipes in an attempt to suit different tastes. With this chocolate move you can argue whether the recipe change is good or not good, but it is normal business practice.
OTOH, the real problem here is using legal means to force grey market business out of business.