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Jerónimo Martins was fined 723 million zlotys (163 million euros) in Poland, where it has the Biedronka supermarket chain, for allegedly “imposing some arbitrary discounts”, mainly on suppliers of fruit and vegetables, later delivering products.
According to the accusation, released this Monday, December 14, the group of Portuguese origin will have invoiced more than 135 million euros with these abusive discount practices that, in the most extreme cases, exceed 20% of the turnover generated with the retailer, having harmed more than 200 producers.
The Authority for the Defense of Competition and the Consumer (UOKiK) describes that “at any time the owner of Biedronka could request a reduction in remuneration by granting an additional discount” and that “due to market power [da retalhista], the suppliers accepted unfavorable conditions, fearing that the end of the cooperation could mean even greater economic losses ”.
President #UOKiK Tomasz Chróstny imposed a fine of more than 723 million PLN on the owner of a chain of stores #Ladybug.
The Jeronimo Martins Polska company won unfairly at the expense of suppliers of food products. Details in press release https: //t.co/kb3JTiNTAj pic.twitter.com/fxcVrJLC0J– UOKiK (@UOKiKgovPL) December 14, 2020
Noting that these additional discounts did not translate into lower prices for Biedronka customers, UOKiK President Tomasz Chróstny speaks of “an absolutely unacceptable use of market power by the commercial network”, of “practices [que] they destroy the foundations of fair competition “and that” are a manifestation of deep dishonesty and lack of respect “on the part of other economic agents.
It is an absolutely unacceptable use of market power by the commercial network. These practices destroy the foundations of fair competition. Tomasz Chróstny, President of the Polish Consumer Protection and Competition Authority
The Polish competition regulator justifies that this economic sanction is “appropriate to the degree of infringement of the law, the inconvenience of the practice and the amount of profits unduly obtained by the Portuguese network.” The shares of Jerónimo Martins, who also owns Pingo Doce and Recheio, fell 1.02% to 14,495 euros, in a day of general gains on the Lisbon Stock Exchange.
Quoted in a press release, Tomasz Chróstny also points out that this decision will make it easier for affected suppliers to obtain compensation in civil cases and recalls that large retailers “did not suffer significantly” from the restrictions of the pandemic, unlike other industries. For this reason, it is even more important that they behave in a responsible and honest way in relation to other businessmen ”, adds the official.
In the most recent presentation of accounts, Jerónimo Martins informed the market that the Biedronka supermarket chain closed the first nine months of this year with a sales increase of 7.3%, to 9.9 billion euros. On the other hand, the sales of the health and beauty store chain Hebe contracted by 9.4% until September, to 180 million euros.
In a few months, this is already the second fine imposed by the Polish competition regulator on Jerónimo Martins Polska. In August, it presented another fine of 26 million euros for charging prices other than those displayed on the shelves, a decision that the subsidiary of the Portuguese retail group announced that it would challenge in court, claiming that these incorrect prices were due to “human error.”
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