Auchan Polska Fined Over 87 Million PLN for Unfair Practices Against Suppliers
The President of the Polish competition authority has imposed a fine of over 87 million PLN on Auchan Polska for exploiting suppliers in the agricultural and food sectors.
12.12.2023 | Polish competition authority
The President of the Polish competition authority, Tomasz Chróstny, has levied a fine exceeding 87 million PLN on Auchan Polska due to actions detrimental to suppliers of agricultural and food products. The company was found to be charging its suppliers for transportation of goods from central warehouses to its stores, which is considered an unfair exploitation of contractual advantage.
Centralized distribution of goods is a fundamental aspect of large retail chains, including Auchan Polska, which operates over 100 supermarkets and hypermarkets. These stores are designed around centralized deliveries and cannot accept goods from numerous individual suppliers. Without the necessary infrastructure for centralized deliveries, Auchan would struggle to compete in the modern retail channel.
According to President Chróstny, charging suppliers for transportation is not an additional service but a core element of the retail business model. This practice is deemed unacceptable as it finances the retailer's operations at the suppliers' expense. The decision also mandates Auchan to cease this practice, although it is not yet legally binding and can be appealed in court.
The imposition of fees for transportation from central warehouses to retail stores has been identified as an unlawful practice in a report by the Polish competition authority regarding sales-related fees imposed by retail chains. Ongoing investigations are also looking into similar practices by Carrefour Polska.
This is not the first action taken by President Chróstny regarding discounts and fees in retailer-supplier relationships. Previous decisions have addressed unfair discounts imposed by Jeronimo Martins Polska, unjustified fees charged by Eurocash, and price reductions demanded by Kaufland Polska after sales. The authority has also required SCA PR, responsible for purchases at Intermarche, to amend practices that disadvantage suppliers.
Farmers and businesses in the agricultural sector are encouraged to report any unfair practices by large partners using their market power to impose unfavorable terms. A special form has been launched to facilitate reporting such irregularities.