(Business in Cameroon) - Cameroon collected CFAF51 billion in taxes and fees from the sales of Guinness Cameroon to the French group Castel. Speaking before the parliament on June 23, 2023, Commerce Minister Luc Magloire Mbarga Atangana (photo), explained that CFAF36 billion of capital gains tax was collected and another CFAF15 billion for registration fees.
Luc Magloire Mbarga Atangana broke the gains down in response to the concerns expressed by MP Daniel Ngalle Etongo. Like several economic operators, those active in the brewing industry notably, the MP was criticizing the share sales, which he believes is against competition laws. He was notably concerned about the consequences the dominant market position (80% of market share) thus acquired by Castel would have on consumers, skyrocketing prices for instance.
"Despite the strengthening of the acquiring company's dominant position, the acquisition of Guinness Cameroun SA by Brasseries et glacières internationales SA (BGI, parent company of Castel Group, editor's note) is compliant with common market rules applicable in the Central African economic union. [It is however] subject to parties’ compliance with the commitments entered into," the Commerce Minister said.
"The acquisition (...) did not fall within the national competence of the State of Cameroon, but within the exclusive competence of the Community Competition Council and the Cemac Commission (...) Cameroon now has to ensure, in perfect harmony with the Cemac Commission, strict compliance with the commitments entered into, particularly concerning the planned investments in production tools, the expansion, and improvement of the distribution network, the preservation and creation of jobs, and the protection of consumer rights. The Ministry of Commerce has taken care of this, especially as beer is one of the products whose prices are subject to the prior approval procedure," he added.
The CEMAC competition council approved the takeover transactions on March 28, 2023. The CFAF300 billion deal was announced by the two brewing groups on July 14, 2022.
The deal provides for job safeguarding by giving Guinness Cameroon employees the choice to either join the workforce of brewing company SABC or get their social entitlements settled. It also includes a 5-year CFAF200 billion investment program, which will begin this year with investments aimed at boosting Guinness product volumes in the country.
According to details provided by SABC’s CEO during a press briefing on December 13, 2022, in Yaoundé, three new production lines dedicated to Guinness products will be built at the Yaoundé, Garoua, and Bafoussam plants. The combined annual capacity of those three lines will be 2.1 million hectolitres.
Brice R. Mbodiam