Beverages News
- Wahaha seeks arbitration in row with Danone
Date: 15-Jun-2007 Sources: (Shenzhen Daily)
DOMESTIC beverage producer Wahaha Group will seek arbitration in China in a legal battle with French food company Danone over their China joint ventures.
'Wahaha has decided to apply for arbitration in Hangzhou in the dispute over the trademark transfer agreement,'Wahaha spokesman Shan Qining said Thursday.
Shan's remarks came a day after Zong Qinghou, who resigned as chairman of the joint ventures last week, told reporters Wednesday he would file for arbitration in Hangzhou, an eastern Chinese city where Wahaha Group is based.
'We will file with the Hangzhou Arbitration Commission as soon as possible,'Zong told a media briefing at Wahaha's offices in the heart of Hangzhou.
In one of then most high-profile commercial disputes between a foreign company and a Chinese joint venture partner, Danone last week filed a lawsuit in California, accusing its partner of breach of contract by using the Wahaha brand on products sold outside the joint ventures.
Danone has filed for arbitration in Stockholm.
Zong has accused the French food group of harming his reputation, and privately held Wahaha has said it will not accept Danone's choice of a chairman for the two companies' joint ventures.
'There is no way back. We will try our best to be responsible to our employees and preserve the Wahaha brand name,'said Zong, speaking under a red banner reading: 'Steadfastly resist Danone's hostile takeover and resolutely protect the brand name of Wahaha.'
The Chinese Government took neutral stance on the dispute Wednesday.
'We hope the two sides will not let any chance to solve the dispute through friendly discussions slip away,'Yao Shenhong, a Commerce Ministry spokesman, told a news conference in Beijing.
In Shanghai on Tuesday, Wahaha employees protested outside a news conference organized by Danone, maker of Evian bottled water, Activia yoghurt and Lu biscuits.
Zong told reporters that net profit at the joint ventures, although hurt by the dispute, rose 30.5 percent year on year in the first five months of this year, exceeding an original forecast of 25 percent growth.
He did not give an actual number for profit.
The row between Wahaha and Danone first came to light in April when Zong published a statement accusing Danone of embarking on a series of hostile takeovers that would result in the loss of Wahaha's control of its own brand.
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