Heineken backs out of row provoked by Hungarian government

Heineken backs out of row provoked by Hungarian government
Viktor Orban's government claimed banning the Heineken logo was a "moral obligation and historic necessity”.
By bne IntelliNews March 27, 2017

Heineken agreed on March 27 to drop its objection to the use of the Csiki brand name by the ethnic Hungarian brewer of the Romanian beer brand, in a case that has once again highlighted the Hungarian government's aggressive stance towards foreign investors.

The move by the international brewing giant is intended to bring an end to efforts by Viktor Orban's rightwing nationalist government to provoke a battle. Budapest had leapt to the defence of the Transylvanian brewer by threatening to ban Heineken's use of the red star logo because of its Soviet connotations, though the symbol is much more ancient.

Lixid Project SRL, producer of the Csiki beer brand, announced on March 27 that Heineken Romania has agreed to drop its long-running legal battle with the local brewer. A Romanian regional court ruled in January that the name is too close to that of the Dutch giant's Ciuc beer brand, which is called Csiki sor in Hungarian.

The Lixid statement read: “the settlement involves compromises on both sides and it allows both companies to continue building their relationship with their consumers, employees, business partners and the local community. Both companies now look forward to leave their past differences behind them and focus on what they do best and enjoy most: brew beer." 

Having initially claimed that banning the red star in the Heineken logo was a "moral obligation and historic necessity”, Janos Lazar, Hungary’s Prime Minister’s Office chief, admitted that the government campaign had been a counter measure to protect the ethnic Hungarian brewery. Local media pointed out that the logo had not been an issue for the Hungarian government when it signed a strategic agreement with Heineken in 2014.

As well as threatening to ban Heineken's red star logo Hungary has also drawn up plans to impose a slew of special taxes on large supermarket companies.