Rami Levy to Testify Against Rival Eyal Ravid in Price-Fixing Trial

Next week, Rami Levy, owner of the Rami Levy Hashikma Marketing supermarket chain, is scheduled to testify in the District Court in Lod as part of the price-fixing trial against Eyal Ravid, owner of the rival Victory chain. Levy, who was previously investigated for price-fixing himself but had his case closed, has been summoned as a witness by the Competition Authority. The authority has not yet debriefed Levy, a standard procedure before testimony.

The Competition Authority alleges that Ravid understood the implications of his public statements, captured in recordings found in his possession, which are key evidence in the trial. In these recordings, Ravid referred to Levy as "the terrorist from Modi'in." Levy is expected to testify about the inner workings of the retail industry, price increases, and relationships between suppliers and retailers in Israel. He will likely be questioned about Ravid's public statements in 2021 that led to the unprecedented indictment against him.

The indictment against Ravid, filed 18 months ago, centers on his public remarks, which the prosecution claims were an attempt to signal competitors to raise prices. Also indicted are Eitan Yohanannof, owner of the Yohanannof chain, for a lesser offense of violating supervisory duty; Elad Harazi, Deputy CEO of Yohanannof; and Efraim Tsvba, CEO of Super Barkat. Ravid faces additional charges under the Food Law for "prohibiting retailer intervention," a first in criminal proceedings. This charge prohibits a retailer from influencing another retailer's prices through a supplier. The indictment claims Ravid and his company intervened with three suppliers regarding the consumer prices set by competing retailers, agreeing to price hikes only if competitors also raised their prices.

Evidence presented by the Competition Authority includes Ravid's public statements, recordings, and correspondence. One charge details how Ravid refused a price increase request from Beit Hashita, leading the company to halt supplies. The authority claims Ravid then intervened in October 2021 concerning prices charged to Rami Levy and Yohanannof. Recordings from Ravid's mobile phone are central to the prosecution's case. In one message to Beit Hashita's CEO, Uri Levy, Ravid stated he would consider price increases only after Rami Levy and Yohanannof did so, disparagingly referring to them as coming from "Kurdistan" and contrasting them with himself as "the Arab from Tunisia."

Further accusations involve Ravid's alleged interference with Dr. Fischer's consumer pricing. In May 2021, after the supplier raised prices, Ravid allegedly communicated with Eyal Shani, VP of Trade at Dr. Fischer, about Rami Levy's prices, noting that he (Ravid) had raised prices while "the terrorist from Modi'in" had not yet updated his catalogs. Shani testified that Ravid's reference to "the terrorist from Modi'in" was indeed to Rami Levy and that price increases in 2021 were rare, driven by necessity due to factors like the COVID-19 pandemic, raw material costs, and shipping. Shani clarified that Dr. Fischer sets wholesale prices, and retailers decide consumer prices, with each retailer determining their profit margin. He noted that some retailers might exploit price increases for an additional 2-3% profit. Shani also stated that price increase decisions were unilateral, though negotiations with retailers could be complex and aggressive, sometimes resulting in withheld supplies until agreement.