The Office of Competition and Consumer Protection (UOKiK) has imposed more than PLN 87 million in penalties on Auchan Polska for acting to the detriment of suppliers of agri-food products, UOKiK said. The company charged its contractors for transporting products from central warehouses to Auchan chain shops.
The internal distribution of goods from the chain’s central warehouses to individual shops is an essential element that forms the modern sales channel and is in the interest of the retail chain, therefore demanding additional remuneration for this service is an unfair use of contractual advantage, it was reported.
A centralised system of supplying goods to shops is a characteristic of the operations of large retail chains. This is also the case for Auchan Polska, which has more than 100 super- and hypermarkets. They are designed and built on the basis of centralised deliveries and are not able to receive goods from hundreds of individual traders. Without the infrastructural facilities to centralise deliveries, the Auchan chain would not be able to compete with its competitors within the modern sales channel.
“The central transport of goods improves the position of the retail chain. It is therefore not an additional service that the supplier should pay for, but a core element of the retail chain’s business model. It is therefore unacceptable to charge for the transport of goods from the main warehouse to the chain’s shops. This is financing your own business at the expense of your suppliers. For such action, I have imposed a fine of over PLN 87 million on the owner of the Auchan chain,” said UOKiK president Tomasz Chróstny.
Producers of dairy, cured meats, fruit and other food products bear the costs of delivering them to Auchan’s warehouses. From that moment on, it is the retail chain that becomes the owner of these goods and decides on its own about their distribution to individual shops. A survey conducted in the course of the proceedings showed that the suppliers have no influence on the stage of Auchan’s internal logistics, but have to bear its costs. In the decision issued, the President of the Office of Competition and Consumer Protection (UOKiK) stated that this constitutes unfair exploitation of the contractual advantage vis-à-vis suppliers of agri-food products. In addition to the financial penalty, he also ordered the chain to cease this practice. The decision issued is not legally binding and can be appealed to court, UOKiK stressed.
The charging of transport fees from central warehouses to the retail chain’s shops was identified as an unlawful practice in a report by the President of the Office of Competition and Consumer Protection (UOKiK) on sales-related fees applied by retail chains. Proceedings are also underway against Carrefour Polska for using such practices.
Source: UOKiK and ISBnews
