Another Attempt to Defend Sugar Monopoly

With a lawsuit against the Ministry of Foreign Trade in Costa Rica the virtually monopolistic Liga Agrícola Industrial de la Caña de Azúcar is attempting to limit the quotas for historical importers of the grain.

Tuesday, March 28, 2017

The administrative proceedings presented by Liga Agrícola Industrial de la Caña de Azúcar (LAICA) against the Ministry of Foreign Trade (COMEX), aim to limit the quotas for historic imports of sugar, and could have consequences for other mass consumption products in the country.

See: "Costa Rica: Conflict in Sugar Market Continues"

The sugar importer Maquila Lama said in a statement that "...LAICA's main question is against the distribution system performed by COMEX, to authorize the entry into the country of imported sugar."

See also: "Sugar Imports and Exports in Central America"

In this regard, LAICA explained that "...The purpose of this action is to achieve a fairer distribution system of tariff quotas because currently, and based on current legislation, 80% is allocated to historic importers and only 20% to new ones."

The legal process, filed in February, calls for the absolute nullity of Articles 9 and 10 of the Regulation on the Assignment of Import Tariffs, according to decree 39938 published on 29 September 2016.

Juan Carlos Sandoval, general manager of Maquila Lama, explained that LAICA had the opportunity in the past to become a historical importer, but did not take it up. "This measure is yet more evidence that their interest is in trying to prevent competition in the national market'."

"... LAICA, which has always denied being a sugar monopoly, has now mentioned in one of the rebuttals against the system for distributing quotas for historical importers such as Maquila Lama, 'it fosters an odious concentration (almost a kind of private monopoly in fact) which excludes other economic agents from this business'."

Sandoval said he regretted "... that argument, especially when it has become clear that LAICA is what is maintaining the sugar monopoly in the country, preventing fair competition in the Costa Rican market and offering a better price option of the grain to consumers," Sandoval said .

See statement by Maquila Lama and statement by LAICA.

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The Commission to Promote Competition in Costa Rica has launched an investigation against Liga Agrícola de la Caña after a complaint was made by Maquila Lama.

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