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September 15, 2009

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Prosecutors probe ad bribe case

TWO former employees of a Shanghai-based Coca-Cola bottling plant have been referred to prosecutors for allegedly accepting bribes, police said yesterday.

The suspects, whose names were not released, used to work in the marketing department of Shanghai Shen-mei Beverage & Food Co Ltd, one of Coca-Cola Co's biggest bottlers in Asia. Police said they were not senior executives at Shen-mei but mid-level employees at most. Other details were not disclosed.

Shen-mei's marketing arm reportedly had an annual budget of about 100 million yuan (US$14.6 million) for advertising and sales promotion. The two suspects allegedly accepted bribes from advertising agencies and suppliers for using their services, according to earlier media reports.

Those reports also said the bribes totaled 10 million yuan, but police said yesterday that the figure was not accurate and they were still investigating the case.

The suspects were detained for investigation in April and later dismissed by the bottling company. They were referred to Pudong New Area prosecutors early this month, according to police.

Shen-mei's former general manager, who was transferred to another post, had nothing to do with the case, according to the company.

Shen-mei, with its headquarters in Pudong's Jinqiao Export Processing Zone, is a Coca-Cola China joint venture with local businesses. Coca-Cola runs 38 bottling plants and has about 30,000 employees in China. The country is its third biggest market globally, with business surging 19 percent last year.

The company's advertising spending in China reached 430 million yuan in the first quarter, up 68.7 percent from a year ago and ranking fourth domestically.


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