Food retailers investigated

25 May 2009

26 May 2009

Bulgaria's Commission for Protection of Competition (CPC) is investigating six major European supermarkets following allegations of poor treatment of suppliers.

It is claimed that the supermarkets have been pressuring vendors to cut costs and accept late payments, according to the Confederation of Employers and Industrialists in Bulgaria.

The retailers include Maxima (Lithuania), Billa (Austria), Piccadilly (Serbia), HIT Hypermarket (Bulgaria) and German firms Metro Cash & Carry and Kaufland.

"The food suppliers say they have been pressured to cut prices, and their arms have been twisted to accept late payments at a time when they need funds to run their businesses," a spokeswoman for the CPC told newswire Reuters.

A statement on the CPC's website said these practices could "distort markets and harm consumers".

If found guilty of breaching competition rules, the supermarkets could be fined. The commission did not specify how long the investigation will take. This will be dependent on the complexity of each case and the cooperation of the retailers.

The CPC is an independent state body based in Sofia, created to protect the interests of participants in the Bulgarian market.

Metro Cash & Carry refused to comment on the proceedings, and the remaining five supermarkets did not respond to SM's request for comment.

Reuters said Bulgaria had been hit hard by the global financial crisis and its businesses have suffered as cheap credit has evaporated.

SMmay2009

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