Press release 17/2023December 29, 2023

The decisionThe AdC has sanctioned Dietmed - Produtos Dietéticos e Medicinais for setting and imposing retail prices (PVP) on distributors. Dietmed is an important supplier of food supplements and health food products, present in various distribution channels throughout Portugal.The AdC's investigation found that Dietmed regularly and generally imposed on distributors the prices at which its products should be sold to consumers.The AdC determined that this behaviour was pursued by Dietmed between 2016 and 2022.The practice in question, of fixing (re)selling prices to the public, harms consumers and is known as Resale Price Maintenance (RPM).

The practiceOn 24 May 2023, the AdC adopted the Statement of Objections (accusation) in this case, and subsequently gave Dietmed the opportunity to exercise its right to be heard and to defend itself, which was duly taken into account in the final decision. To summarise, during that period, the company imposed resale prices on distributors by sending out retail price lists and defining the maximum discount limit applicable to the PVP of the products.To this end, Dietmed has implemented a system to control and monitor compliance with the resale prices it sets (or the authorised discount limit).At the same time, it created a system of incentives for this purpose, threatening or reducing the commercial conditions of its distributors, as well as cutting off supplies or limiting stock replenishment in the event of non-compliance.

The fineThe AdC sanctioned Dietmed with a fine of €1,040,000.The fines imposed by the AdC are determined by the turnover of the companies in the affected markets in the years of the practice. According to the Competition Law, fines may not exceed 10 per cent of turnover in the year preceding the adoption of the decision. When setting the fine, the AdC takes into account the seriousness and duration of the behaviour, the degree of participation of the companies in the infringement, the economic situation of the companies, among other circumstances (cf. AdC Guidelines on methodology in the application of fines).The AdC's sanctioning decisions can be appealed. Appeals do not suspend the enforcement of fines. Companies can ask the Competition, Regulation and Supervision Court to suspend the enforcement of decisions if they (i) demonstrate that they cause them considerable damage and (ii) offer an effective guarantee in their place.Infringements of competition rules not only reduce consumer welfare, but also harm the competitiveness of companies, penalising the economy.

AdC fines Dietmed for Resale Price Maintenance of food supplements and health food products

The AdC has fined Dietmed, a supplier of food supplements and health food products, for engaging in Resale Price Maintenance (RPM) by setting and imposing retail prices on distributors. The company implemented a system to control and monitor compliance with the resale prices and used incentives and threats to enforce them. The fine imposed by the AdC is €1,040,000. This case highlights the importance of competition rules in protecting consumer welfare and promoting competitiveness in the market.

AdC fines Dietmed for Resale Price Maintenance of food supplements and health food products

The Portuguese Competition Authority (AdC) has fined Dietmed for imposing retail prices on distributors of food supplements and health food products.