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The Portuguese retailer Jerome Martins, through the Polish unit Biedronka, “showed deep dishonesty and disrespect for competitors”And therefore he was fined 723 million zlotys (equivalent to 163 million euros) by the Polish competition authority. More than 200 agricultural producers are said to have been harmed by a practice that the regulator said involved “arbitrarily imposing discounts” and “unfairly” after the products had been delivered to the distributor.
The indictment is available on the Polish regulator’s website, which is, according to the entity, the largest fine in a case in which a company abuses its contractual position. The note explains that it is normal for retailers to receive discounts from suppliers, by virtue of a contract between the parties: what is “unfair” is to be the distributor, as a result, realize that discounts would be applied unilaterally (depending on how products flowed from their stores).
This happened in the period under review – 2018, 2019 and 2020 – according to the regulator, and will have allowed Biedronka to win 600 million zlotys (135 million euros) unfairly.
According to the authority, “at any time Biedronka could request a reduction in the payment through an additional discount” and the suppliers had no alternative but to accept, because they feared they would be harmed in the future. “Due to the power of the market [da empresa distribuidora], the suppliers accepted unfavorable terms “under the veiled threat that the alternative could dictate” the end of the cooperation “, which” could mean even greater financial losses “in the future.
In addition to the text of the accusation, the regulator released several tweets in the social network Twitter, in the last hours, where he gives some real examples of fruit and vegetable suppliers, as well as meat producers, who were harmed by the practices applied by Biedronka. In one of these examples it is stated that “the greatest losses suffered by the suppliers of the Polish unit of Jerónimo Martins were in the fruit and vegetable sector: one of the suppliers had to pay more than 151 million zlotys in one year [mais de 34 milhões de euros]”.
The biggest losses in discounts applied by Jeronimo Martins Polska were those suffered by suppliers of fruit and vegetables. One of them had to pay more than PLN 151 million during the year, which represented more than 26% of the total turnover with Biedronka ⬇️⬇️⬇️ pic.twitter.com/qZSarrAv2m
– UOKiK (@UOKiKgovPL) December 14, 2020
The Observer is trying to get a reaction from Jerónimo Martins to this conviction. This news will be updated when that comment arrives.
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