GEISHA KOW­LESSAR ALON­ZO

Dis­tri­b­u­tion con­glom­er­ate Agos­ti­ni Ltd’s ac­qui­si­tion of restau­rant man­age­ment com­pa­ny Pres­tige Hold­ings Ltd is ex­pect­ed to be suc­cess­ful, but with “con­di­tions” at­tached to it, the Busi­ness Guardian un­der­stands.

The ac­qui­si­tion would con­sol­i­date some of the coun­try’s largest con­sumer, re­tail and restau­rant brands un­der a sin­gle par­ent en­ti­ty, with pro for­ma 2025 rev­enue of close to $7 bil­lion and af­ter-tax prof­it of close to $400 mill. The trans­ac­tion has been un­der­go­ing in­tense reg­u­la­to­ry scruti­ny for more than two months.

When con­tact­ed ex­ec­u­tive di­rec­tor of the Fair Trad­ing Com­mis­sion (FTC) Be­van Nar­i­nesingh, said he would nei­ther con­firm nor de­ny that the com­pe­ti­tion reg­u­la­tor has ap­proved the trans­ac­tion.

Ef­forts to con­tact the Agos­ti­ni Group were un­suc­cess­ful. Agos­ti­ni and Pres­tige Hold­ings are both chaired by Chris­t­ian Mout­tet.

In an in­ter­view with the Busi­ness Guardian on Mon­day, Nar­i­nesingh said the deal had of­fi­cial­ly en­tered its fi­nal reg­u­la­to­ry stretch, with a de­fin­i­tive de­ci­sion ex­pect­ed from the FTC be­fore the end of Ju­ly.

He con­firmed the reg­u­la­to­ry body is fi­nal­is­ing its de­lib­er­a­tions on the trans­ac­tion.

The mul­ti-mil­lion dol­lar deal has faced a se­ries of de­lays, large­ly due to a ten-month pe­ri­od dur­ing which the com­mis­sion op­er­at­ed with­out a func­tion­ing board of com­mis­sion­ers.

The pri­ma­ry man­date of the com­mis­sion, dur­ing this in­ten­sive two-month re­view, has been de­ter­min­ing whether the ac­qui­si­tion would lead to a sub­stan­tial less­en­ing of com­pe­ti­tion in the lo­cal mar­ket. Be­cause Agos­ti­ni pos­sess­es bil­lions of dol­lars in to­tal as­sets and op­er­ates heav­i­ly across phar­ma­ceu­ti­cal, health­care and con­sumer dis­tri­b­u­tion sec­tors, its as­sim­i­la­tion of Pres­tige Hold­ings—which man­ages promi­nent glob­al fast-food fran­chis­es in­clud­ing KFC, Piz­za Hut, Sub­way, Star­bucks, and TGI Fri­days—presents a com­plex struc­tur­al shift.

“Our con­cern is com­pe­ti­tion, whether this trans­ac­tion would have a neg­a­tive ef­fect on com­pe­ti­tion in the spe­cif­ic mar­kets in which these en­ti­ties are op­er­at­ing in...

“It’s a very long process be­cause it re­al­ly deals with stake­hold­er con­sul­ta­tions, our own analy­sis, our mar­ket analy­sis as well where there’s a con­stant back and forth with the merg­ing par­ties as well where they have to con­stant­ly an­swer is­sues or ques­tions that we may raise. That’s why it’s a very in­tense process over this two months that we have been en­gag­ing with the par­ties,” Nar­i­nesingh ex­plained.

Al­so asked what spe­cif­ic an­ti-com­pet­i­tive thresh­olds or pub­lic in­ter­est cri­te­ria the com­mis­sion weighed re­gard­ing the trans­ac­tion, giv­en its scale in the lo­cal con­sumer mar­ket Nar­i­nesingh said un­der the Fair Trad­ing Act, the com­mis­sion is re­quired to as­sess whether such a merg­er is like­ly to sub­stan­tial­ly lessen com­pe­ti­tion in a mar­ket in T&T.

“In un­der­tak­ing that as­sess­ment, the com­mis­sion con­sid­ers a range of fac­tors, in­clud­ing the lev­el of con­cen­tra­tion in the rel­e­vant mar­kets, the po­ten­tial im­pact on con­sumers, bar­ri­ers to en­try, the like­li­hood of an­ti-com­pet­i­tive ef­fects and any ef­fi­cien­cies or oth­er ben­e­fits that may arise from the trans­ac­tion.

“The com­mis­sion al­so con­sid­ers whether there are broad­er pub­lic in­ter­est con­sid­er­a­tions that may be rel­e­vant un­der the Act. Each merg­er is as­sessed on its own facts and ev­i­dence, and the com­mis­sion’s de­ter­mi­na­tion is based on the to­tal­i­ty of the in­for­ma­tion be­fore it,” he added.

Nav­i­gat­ing reg­u­la­to­ry bound­aries

Be­yond the im­me­di­ate land­scape of the fast-food and re­tail sec­tors, the com­mis­sion’s re­newed ac­tiv­i­ty comes at a time of broad­er pub­lic con­cern re­gard­ing mar­ket dom­i­nance, cor­po­rate be­hav­iour and the ris­ing cost of liv­ing in T&T.

Nar­i­nesingh not­ed that while the FTC con­tin­ues to re­ceive a steady in­flux of pub­lic com­plaints, a sig­nif­i­cant por­tion must be rout­ed to par­al­lel reg­u­la­to­ry bod­ies.

“Many com­plaints that we have re­ceived have been re­ferred to oth­er reg­u­la­to­ry agen­cies giv­en it falls un­der their purview,” he not­ed.

One such ju­ris­dic­tion is the telecom­mu­ni­ca­tions sec­tor, which has re­cent­ly drawn scruti­ny from small­er dig­i­tal sales providers con­cerned about po­ten­tial an­ti-com­pet­i­tive be­hav­iours and steep bar­ri­ers to en­try.

While Nar­i­nesingh clar­i­fied that a for­mal com­plaint re­gard­ing these spe­cif­ic en­try bar­ri­ers had not of­fi­cial­ly land­ed on the com­mis­sion’s desk, he em­pha­sised that the agency main­tains a con­tin­u­ous, col­lab­o­ra­tive di­a­logue with the Telecom­mu­ni­ca­tions Au­thor­i­ty of T&T (TATT).

“The telecom­mu­ni­ca­tions mar­ket as it re­lates to, for in­stance, the pro­vi­sion of tele­phone ser­vices, there are cur­rent­ly very few providers. So there is def­i­nite­ly, how you term it, ei­ther du­op­oly or oli­gop­oly,” Nar­i­nesingh stat­ed.

He stressed that when the com­mis­sion in­ter­acts with TATT, it al­ways raise con­cerns about there be­ing a du­op­oly, a du­plis­tic mar­ket or oli­gop­o­lis­tic mar­ket to en­sure that com­pe­ti­tion prin­ci­ples are heav­i­ly weight­ed when­ev­er tele­com poli­cies or sec­tor ap­provals are be­ing de­ter­mined by the state au­thor­i­ty.

The bat­tle against ris­ing food prices

The broad­er pub­lic de­bate over cor­po­rate pow­er has al­so been fu­elled by es­ca­lat­ing food prices across the coun­try, prompt­ing tough ques­tions re­gard­ing the le­gal lim­its of reg­u­la­to­ry in­ter­ven­tion.

Pub­lic frus­tra­tion over per­ceived cor­po­rate ex­ploita­tion has led to calls for gov­ern­ment ac­tion, but the com­mis­sion has high­light­ed dis­tinct bound­aries with­in ex­ist­ing frame­works, not­ing that high costs do not in­her­ent­ly equal an il­le­gal prac­tice.

“Price goug­ing is cur­rent­ly not an of­fence un­der the con­sumer leg­is­la­tion as well as the com­pe­ti­tion leg­is­la­tion,” Nar­i­nesingh clar­i­fied, though he not­ed that amend­ments to con­sumer laws have been pro­posed to ad­dress the gap, adding, “Hope­ful­ly that will be a vi­o­la­tion, that will be an of­fence very soon.”

As the law stands, a sharp in­crease in re­tail pric­ing on­ly cross­es in­to a statu­to­ry vi­o­la­tion if it can be legal­ly proven to be an abuse of dom­i­nance by a true mo­nop­oly.

“Our con­cern with price goug­ing is if this is be­ing done by a mo­nop­oly and that could be an ex­am­ple of abuse of dom­i­nance on the part of the mo­nop­oly,” Nar­i­nesingh ex­plained.

The com­mis­sion has his­tor­i­cal­ly used pub­lic news re­leas­es to mon­i­tor these trends and en­cour­age fair pric­ing, but it re­mains lim­it­ed to pros­e­cut­ing ac­tu­al abus­es of mar­ket pow­er rather than man­ag­ing in­fla­tion.

FTC stays out of $3.4B hous­ing probe

The FTC would not launch an an­ti-com­pe­ti­tion in­ves­ti­ga­tion in­to the can­celled $3.4 bil­lion Hous­ing De­vel­op­ment Cor­po­ra­tion (HDC) mega-project, Nar­i­nesingh said, out­lin­ing that it has re­ceived no com­plaints or ev­i­dence of car­tel be­hav­iour.

Nar­i­nesingh said the mul­ti-bil­lion-dol­lar De­sign-Build-Fi­nance hous­ing ini­tia­tive, which was can­celled by the HDC fol­low­ing pub­lic con­tro­ver­sy, in­volves is­sues that cur­rent­ly fall out­side the FTC’s le­gal man­date.

The sprawl­ing mul­ti-bil­lion-dol­lar ini­tia­tive was abrupt­ly stop­pled by the HDC last week, af­ter in­tense pub­lic out­cry and pro­ce­dur­al in­ter­ven­tions by the Of­fice of Pro­cure­ment Reg­u­la­tion (OPR). While the sud­den dis­so­lu­tion of the project ig­nit­ed fierce na­tion­al de­bate re­gard­ing how the state con­tract was award­ed, Nar­i­nesingh high­light­ed that the core griev­ances be­long to a com­plete­ly sep­a­rate statu­to­ry ju­ris­dic­tion.

“With re­spect to is­sues and con­cerns re­lat­ing to the can­celled con­tract, based on the in­for­ma­tion avail­able to the com­mis­sion, the con­cerns raised pub­licly ap­pear to re­late pri­mar­i­ly to pro­cure­ment process­es and pro­cure­ment gov­er­nance which fall with­in the OPR’s ju­ris­dic­tion,” Nar­i­nesingh ex­plained.

The ex­ec­u­tive di­rec­tor not­ed that the im­mense mon­e­tary scale of a pub­lic ten­der­ing ex­er­cise is not a base­line jus­ti­fi­ca­tion to as­sume an­ti-com­pet­i­tive wrong­do­ing or trig­ger a reg­u­la­to­ry probe.

“The ex­is­tence of a large pro­cure­ment process alone would not be suf­fi­cient to trig­ger an in­ves­ti­ga­tion,” Nar­i­nesingh stat­ed adding, “At this stage, we have not com­menced any in­ves­ti­ga­tions and it would not be ap­pro­pri­ate to spec­u­late on the ex­is­tence of an­ti-com­pet­i­tive con­duct as there is no ev­i­dence be­fore us to sug­gest that this has tak­en place.”

While the FTC would re­main on the side­lines for now, Nar­i­nesingh main­tained that the com­mis­sion is keep­ing a close eye on the mar­ket and shares a uni­fied front with the OPR.

“The OPR and the FTC have dis­tinct but com­ple­men­tary roles as both agen­cies are com­mit­ted to ad­dress­ing an­ti-com­pet­i­tive con­duct such as bid rig­ging, col­lu­sion, mar­ket al­lo­ca­tion and oth­er agree­ments that re­strict com­pe­ti­tion,” he re­marked.

In terms of in­ves­ti­ga­tions, Nar­i­nesingh said fo­cus re­mains on whether there is ev­i­dence of co­or­di­na­tion or agree­ments among com­peti­tors that may dis­tort a com­pet­i­tive ten­der­ing process.

Nar­i­nesingh fur­ther de­tailed that if an ag­griev­ed bid­ding com­peti­tor sus­pects foul play, they are free to ap­proach the com­mis­sion once a pub­lic ten­der con­cludes, though he cau­tioned that the an­ti-trust route takes con­sid­er­able time.

“On the com­ple­tion of a pro­cure­ment process an ag­griev­ed par­ty can bring a com­plaint to us on al­le­ga­tions of, for ex­am­ple, bid rig­ging and col­lu­sion. This may lead to us trig­ger­ing an in­ves­ti­ga­tion. This how­ev­er will take time,” Nar­i­nesingh ex­plained.

For stake­hold­ers or cit­i­zens track­ing the fall­out who want a quick, de­ci­sive reg­u­la­to­ry re­sponse, Nar­i­nesingh con­clud­ed that the pub­lic pro­cure­ment watch­dog is the far bet­ter al­ter­na­tive.

“If the in­ten­tion is to get im­me­di­ate re­lief, it would be bet­ter to go to the OPR who can po­ten­tial­ly can­cel the pro­cure­ment al­most im­me­di­ate­ly pro­vid­ed the ev­i­dence be­fore it is both co­gent and cred­i­ble,” he ad­vised.