Food producers are under serious economic pressure, and some of them are selling goods below cost. This was stated by Zhelyo Boychev, a member of the Commission for Protection of Competition, regarding the sanctions against Kaufland totaling EUR 75,653,706.
The CPC imposed the sanctions for three established unfair trading practices involving Bulgarian food producers. According to Boychev, the sectoral market analysis showed an unfair distribution of added value along the producer-supplier-retailer chain.
“Some products end up being sold below cost,” Boychev said.He pointed out that the economic benefit is shifting to the retailer at the expense of the producer and supplier. According to him, Kaufland is increasing its competitiveness through economic pressure on its suppliers.
Negotiations for Lower Supply Prices
Boychev said that every year the chain negotiates with producers to reduce supply prices. According to him, this leads to situations in which certain items are sold below cost and are then removed from the assortment and replaced with new products.
The CPC member also recalled earlier cases involving the chain, including an abuse of a dominant position in negotiations in 2015 established by the commission. The CPC said that the practices were established in separate proceedings in 2020, 2025 and 2026.
Boychev declined to comment on the controversial statement by Kaufland’s former executive director, Mikhail Petrov, after which he was dismissed from his position. He said that the court would rule on all the decisions and facts in the case.
“The Sanction Is Well Below the Maximum”
Regarding claims that the sanction is unprecedented, Boychev said that the CPC operates according to an established methodology. He pointed out that the maximum amount is 5% of the supplier’s turnover, while the sanction imposed is significantly below that threshold.
“We operate according to an established and adopted methodology,” Boychev said.As examples, he cited fines of tens of millions of euros in France and a sanction imposed by the Polish regulator of more than EUR 170 million, which was subsequently reduced by the court to slightly over EUR 100 million.
The CPC’s decision is subject to judicial review, and the final assessment of the dispute will be made by the court.
Sources: focus-news.net, bgonair.bg