Knudsen Expands National Antitrust Push to Beer Industry

Montana Attorney General Austin Knudsen is asking the U.S. Department of Justice to examine what he says are potentially anti-competitive practices by global brewing giant AB InBev, the latest move by the Montana Republican to take a prominent role in national antitrust disputes.

In a September letter to Associate Attorney General Stanley Woodward, Knudsen raised concerns about efforts by AB InBev to secure favorable state tax treatment for beer classified as “domestic,” while also pursuing federal tariffs that he argues could undermine competition created by a 2013 Justice Department antitrust settlement.

Knudsen said the foreign-based company has promoted legislation in multiple states that would define “domestic beer” in a way that provides significant tax advantages to its operations. In some states considering the proposals, he said reports indicate AB InBev could receive more than half of the available tax benefit.

The attorney general argued the issue has direct implications for Montana agriculture. His letter notes that Montana barley farmers sell grain to American companies that ship barley to Mexico for brewing beer that is then imported into the U.S. market. Knudsen warned that tariffs or policies shifting the competitive balance toward foreign-based suppliers could ultimately hurt those farmers.

At the center of Knudsen’s argument is a 2013 Justice Department antitrust settlement involving AB InBev. The federal government required the company to divest Mexican beer assets as part of an effort to preserve competition in the U.S. beer market. Knudsen contends some of AB InBev’s current efforts threaten to undermine the competitive structure created by that settlement.

He is asking the Justice Department’s Antitrust Division to review the company’s activities and their potential effects on American consumers, craft brewers, wholesalers, retailers and farmers.

The request follows Knudsen’s involvement in several major national antitrust fights.

Earlier this year, Knudsen and Nebraska Attorney General Mike Hilgers led an 11-state coalition asking the Justice Department to scrutinize Netflix’s proposed acquisition of Warner Bros. The attorneys general warned the combination could increase streaming prices, reduce competition and diminish consumer choice.

Netflix ultimately walked away from the transaction two days after Knudsen’s coalition publicly called for federal scrutiny, declining to match a rival bid from Paramount Skydance.  The attorneys generals’ opposition added to the regulatory scrutiny surrounding the proposed transaction.

Knudsen has also taken a leading role in opposition to the proposed Union Pacific-Norfolk Southern railroad merger, raising concerns about reduced rail competition, higher shipping costs and fewer options for farmers, manufacturers and other shippers.

The three disputes span markedly different industries  but reflect an increasingly active antitrust posture from the Montana attorney general focused on consolidation and its effects on consumers, agriculture and smaller competitors.

In his latest letter, Knudsen said federal antitrust enforcement helped establish a more competitive American beer market and urged federal regulators to scrutinize efforts that could shift that balance toward foreign-based suppliers at the expense of U.S. businesses, consumers and farmers.

By: Politics406 staff

Read the full letter HERE