Coca-Cola Denies Suspending France Investment Over Tax

Coca-Cola's Europe boss said he 'was sorry about a communication error' by the company's French branch which 'has sown confusion about Coca-Cola's engagement in France.'

The head of Coca-Cola Europe has denied the soft drinks giant suspended a 17-million-euro investment in France to protest a new tax on sugary drinks, despite Coca-Cola France making the announcement.

Coca-Cola Europe boss Hubert Patricot said on Sept. 9 that he "was sorry about a communication error" by the company's French branch which "has sown confusion about Coca-Cola's engagement in France."

Patricot told LCI television by telephone that "we confirm our investment of 17 million euros in the Pennes-Mirabeau site" but "We remain firmly opposed to a tax... which stigmatizes a drinks category."

Coca-Cola France on Sept. 9 said the company had suspended a planned 17-million-euro (US$24-million) investment at the Pennes-Mirabeau plant in the south of France to protest the tax.

Prime Minister Francois Fillon announced the tax on August 24 as part of the government's fight against obesity and within the framework of a broader austerity program.

"We want to make a symbolic protest against a tax that punishes our company and stigmatizes our products," Coca-Cola France said.

The tax is expected to come into effect in early 2012 and bring in 120 million euros for state coffers. It works out as one euro cent per can of drink. French politicians had roundly criticized the reported suspension of investment, which one MP described as "blackmail."

Coca-Cola employs around 3,000 people at five sites around France. The Pennes-Mirabeau facility employs 203 people and has had 45 million euros invested in it over the last five years, the company said.

Copyright Agence France-Presse, 2011

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