The retail chains of REWE Group abused the significant market power, the settlement procedure set their fine to CZK 164 million

2019-02-22
The Office for the Protection of Competition imposed a fine for abuse of significant market power in the amount of CZK 164 372 000 on the retail chains BILLA, spol. s.r.o. and Penny Market, s.r.o. (hereinafter referred to as „BILLA“ and „Penny“) and to their subsidiary Rewe Buying Group s.r.o. (hereinafter referred to as „RBG“). The decision was adopted within the settlement procedure; the appeal had not been filled and the decision has already become final.

On the basis of information from suppliers and the findings of preliminary investigation, the Office initiated an administrative proceeding focused on the manner in which the parties acted in cooperation with each other as a purchasing alliance, negotiated and obtained the RBG bonuses from their food suppliers. Following the amendment to the Act on Significant Market Power of 2016, which restricts payments without any consideration, the parties to the proceedings started to convert the RBG bonuses into quantity or price discount. However, in relation to particular suppliers the RBG bonus still remained in its original form.

In its decision, the Office concluded that the RBG bonus in all above-mentioned forms is a fee without real consideration which has been requested without any legitimate reason and therefore is unlawful. At the same time, in some cases the RBG bonus was a condition for delivery of food to relevant retail chains. The Office has revealed a total of 23 administrative offences concerning 22 suppliers affected by this illegal payment.

The fines were imposed on particular parties to the proceedings in the amount of CZK 70 791 000 on Billa, CZK 93 377 000 on Penny and CZK 24 000 on RBG.

Press Unit of the Office                            
19/015/VTS001 – S0127/2017

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