• Carrefour Polska is likely to abuse a contractual advantage against suppliers of agri-food products.
• President of UOKiK Tomasz Chróstny has brought charges against the company.
• Concerns have been raised about the unjustified charging of contractors for transporting goods from the central warehouse to the chain’s stores.

As part of its competencies related to combating the unfair use of contractual advantage, the President of UOKiK monitors the relationships of large retail chains with suppliers of agri-food products. This resulted in two reports, among others. The first one described the discounts used by retail chains. The other one concerned sales-related fees, charged for performing services to suppliers related to the process of selling goods. One of the unfair practices described in the report was asking suppliers to pay for the service of delivering products from the chain’s central warehouses to individual retail stores.

- Central distribution of goods is an integral part of the business model of retail chains and is in their interest, so it is unacceptable to ask suppliers to pay for transportation from the main warehouse to the stores. In fact, it is the chain’s passing on the costs of its own operations to contractors. Carrefour may be affected by this unfair practice. It faces a penalty of up to 3 percent of turnover for unfairly exploiting its contractual advantage – says Tomasz Chróstny, President of UOKiK.

It would be impossible or unprofitable to operate several hundred stores belonging to a retail chain based on daily receipt of goods from multiple suppliers. Widespread centralisation, including logistics, enables chains to negotiate favourable commercial terms by taking advantage of economies of scale. This is one of the pillars of the modern distribution channel and the success of retail chains, thus being a natural part of their business model. An entity without the infrastructure facilities to centralise deliveries would not be able to compete effectively with other retail chains.

This is also the case with Carrefour Polska. It would be in the entrepreneur’s interest to distribute goods to individual stores, even if he did not receive money for doing so. At the same time, the findings made in the course of UOKiK’s work to date on the relationships of retail chains with suppliers of agri-food products indicate that there are players in the market who perform activities related to the distribution of goods from distribution centres to retail outlets at their own expense. This could mean that Carrefour Polska, by charging for transportation from central warehouses to stores, is passing on the costs of its operations to suppliers. Such a practice may be a manifestation of unfair use of contractual advantage and is punishable by a penalty of up to 3 percent of the entrepreneur’s annual turnover.

This is not the only proceeding involving charges for transporting goods from central warehouses to retail chain stores. Earlier, the President of UOKiK charged Auchan Polska with unfair use of contractual advantage.

Entrepreneur, farmer, if you operate in the agricultural and food industry and your major counterparty abuses its competitive advantage by imposing unfavourable conditions of cooperation – report it to UOKiK. We have launched a special form to help you report any irregularities. Click here to fill it out: ankieta.uokik.gov.pl/formularz-zgloszenie-przewaga/.