It is therefore clear that there is no substance to this argument of the company. In any event, and more than necessary, I will note that the specific consideration regarding a particularly high sales turnover is consistent with the deterrent purpose of the law, with the rationale that appears In the section 50IV to the law regarding the consideration of the sales turnover for the purpose of determining the maximum sanction that can be imposed on a violator, and with the explanatory notes to the law as follows:
"The differential sanction imposed on corporations expresses the principle of proportionality. The Antitrust Authority supervises the compliance of the provisions of the law by all entities in the economy, large and small. In order to create effective deterrence, and at the same time avoid charging the violator amounts that he will not be able to meet, it is necessary to adjust the amount of the financial sanction to the identity of the violator. Hence, the Law creates a connection between the corporation's sales turnover, which is a strong indication of the scope of its activity, and the maximum sanction that can be imposed on it" (Explanatory Note to the Law, at p. 241; emphases are not in the original).
In addition, consideration of this issue as a consideration of severity due to external circumstances of the breach has long been applied in the case law of this Court (Matter Ashdod Portparagraphs 180-181). In conclusion, even with regard to this chapter, I did not find it necessary to intervene in the court's rulings.
Policy against parallel imports
- In this chapter as well, I will preface the beginning, and say that with regard to the issue of parallel imports, I saw fit to accept the company's appeal and reject the Director-General's appeal. Here, too, it should be noted that the tribunal partially accepted the company's appeal in this matter and ruled that the provisions for a monopoly holder and section 29A of the Competition Law were indeed violated , but there was no violation of the agreed order and section 29 of the law. Accordingly, the court also reduced the amount of the financial sanction. Appeals were filed against this determination, both by the company and by the commissioner.
- First, it should be clarified that at the present time there is no dispute that the starting point is that parallel imports are a permissible practice and even of great value for promoting competition, and as a result, it is also of great value for lowering prices for the consumer, for improving the quality of products and services, and therefore it should be encouraged (Civil Appeal Authority 371/89 Leibowitz v. Y. Eliyahu Ltd., IsrSC 44(2) 309, 325-328 (1990); High Court of Justice 344/89 H.S.H. - International Trade inTax Appeal v. Minister of Industry and Trade, IsrSC 44(1), 456, 470 (1990); Civil Appeal 7629/12 SWISSA V. TOMMY HILFIGER LICENSING LLC, PARAGRAPHS 17-21 [NEVO] (16.11.2014); Iris Soroker, "Parallel Importation of Trademarked Products - The Contractual Solution," 27 Law Units 257, 259 (2003)). Accordingly, I do not take lightly the harm done to parallel imports or to an action that seeks to thwart it. However, it should be noted that in the relevant period examined for the purpose of imposing the financial sanction, no evidence of the existence of legal parallel imports was presented. This fact is also not in dispute. This matter is of great importance, as will be explained below.
- At the center of this issue is the procedure adopted by the company in relation to parallel imports, which was determined to be in use between the years 2009-2014. According to the procedure, the company's employees were instructed to report the parallel merchandise found with customers, bring a sample of it from the point of sale (except in cases where the produce was not written in Hebrew at all) and forward it to the headquarters manager, mark the product, notify the customer of a temporary interruption in the supply of products of the same category, and report customers who were blocked. The procedure also included a conversation script, which will be reworded below:
"You hold at the point of sale a product that bears the brands of the Central Company for the Distribution of Soft Drinks, but was not manufactured by the Company. According to a legal opinion in our possession, these products are illegal, and therefore we are prohibited from selling you the company's products in the category until the equivalent goods are removed from the point."