Poland’s consumer authority brings charges against supermarket chains Auchan and Intermarché

Poland’s consumer protection authority, UOKiK, has charged supermarket chains Auchan Polska and SCA PR Polska, the owner of the Polish branch of Intermarché, with unfair use of contractual advantage against suppliers of agricultural produce.

If the UOKiK’s allegations are substantiated, the owners of these retail chains face a penalty of up to 3% of their annual turnover.

“Large retail chains cooperate with many suppliers of produce, which are often much smaller than them,” said UOKiK. “The relationship between the retail chain and the contractor in many cases is characterized by a disproportion in economic potential, which is sometimes used by the stronger party to impose unfavourable conditions on weaker players.”

“For suppliers of produce, selling to a network is in many cases to be or not to be”, the authority said, pointing out that they often agree to the imposed terms of cooperation without having a “real opportunity to negotiate”.

The charges against Auchan concern the unjustified collection of fees from contractors. The retail chain demanded fees from the supplier for the service of distributing products to store outlets from a central warehouse, despite the fact that central logistics is one of the pillars of the retail chain’s business model.

According to the authority, in 2020-2021 Auchan charged contractors for the cost of transporting goods from warehouses to individual markets, thus shifting part of the cost of running its own core business to suppliers.

Not all suppliers were charged a transportation fee, however. Some were exempt from it, which may indicate unequal treatment of partners. “Charging suppliers a fee is only justified if the services performed by the network are of real value to the counterparties,” said UOKiK’s head, Tomasz Chróstny.

“In other situations, it is a way of shifting one’s own logistics costs to a trading partner and constitutes an illegal, unfair use of contractual advantage.”

In the case of Intermarché, the authority found that the chain belatedly concluded its annual agreements with suppliers. Thus, suppliers, fulfilling orders in the period from 1 January of a given year until the date of signing the contract, were not sure on what terms and conditions sales would be settled retroactively.

In addition, in some cases, suppliers were charged additional discounts not provided for in the original supply contracts.

“A situation in which suppliers of produce do not know for several months on what terms they are selling their goods to retail chains is absolutely unacceptable and constitutes unfair exploitation of contractual advantage,” said Chróstny.

Both retail chains are yet to address the charges.

Main photo credit: Intermarche press pack

Alicja Ptak

Alicja Ptak is senior editor at Notes from Poland and a multimedia journalist. She previously worked for Reuters.