SUPREME Ventures Limited (SVL) seems set to battle with the Jamaica Fair Trading Commission (FTC) demanding it withdraw its investigation report which found that the regional gaming company abused its dominant market position in contravention of the Fair Competition Act.
The demand was made by SVL through its lawyers.
In an two-page letter dated February 16, 2022, SVL which said it did not know about the report when this newspaper reached out first for comment on Tuesday, wrote to the FTC about the matter.
The FTC, for its part, in a 32-page draft report published on its website on Monday, charged that since the onset of competition in Jamaica's local gaming market in 2021, SVL has been engaging in conduct which is lessening competition in contravention of the Act.
The Jamaica Observer broke the news on Wednesday, highlighting also that the competition regulator is recommending that its commissioners take the appropriate measures to correct the breach identified. However, SVL through attorneys from the law firm of Hylton Powell, demanded that the report be withdrawn and pulled from the FTC's website, where it has been uploaded.
The report has since been pulled from the website.
In addition, SVL's attorneys demand that the FTC “formally announces to the world through the media that the draft report has been withdrawn. Please also advise us of your offer on account of compensation to our clients”.
David Miller, executive director of the FTC, confirmed to the Caribbean Business Report in a telephone conversation on Wednesday that the publication of the report was due to an internal error.
On Thursday, in an apparent response to the demand from SVL, the FTC in a release said, “The publishing of the draft report was premature as it had yet to be approved by the commission. Accordingly, the report should not be taken as the commission's final report. On the morning of February 16, 2022, the draft report was taken down from the FTC's website.”
Miller offered no further comment on the issue.
That issue aside, SVL through its attorneys also levelled accusations at the FTC, saying the commission itself was in breach of the Fair Competition Act, too. The law firm wrote that its client was only made aware of the report on Tuesday afternoon when contact was made with the CEO as cited above.
“Prior to this, my clients had no knowledge of the contents or even the existence of this draft report. In the circumstances, your publication of this draft report is a clear and gross breach of the Fair Competition Act,” the letter stated.
The law firm contends that, “in consequence of the publication of this draft report by the FTC, its widespread dissemination and the subsequent news item in the media, our clients have suffered and incurred substantial loss, damage and expense”.
The investigation by the FTC was carried out under sections 19-21 of the Fair Competition Act, which prohibits any action of an enterprise occupying a dominant position in a market from abusing its dominance to the detriment of effective competition. The FTC in its investigation report detailed two examples in which SVL abused its dominant market position.
Firstly, the FTC cited where SVL secured approval to offer odds of up to 50:1 for its pick 1 lottery game (Cash Pot), contending that “such high odds are likely to be ex ante unprofitable for a lottery game with a field of only 36 numbers and therefore would be irrational to implement for any profit-maximizing enterprise”.
Secondly, within two weeks of the first competitor Mahoe Gaming's entry into the market, SVL terminated the first of 48 retailer agreements with retailers, which distributed games for the recent entrants, in pursuant to its channel and business realignment strategy.