Unfair trading practices: CCA imposes HRK 85,000 fine on Jadranka trgovina

The Croatian Competition Agency (CCA) opened three ex officio infringement proceedings against Jadranka trgovina within the meaning of the Act on prohibition of unfair trading practices in the business-to-business food supply chain (UTPs Act) with the view to establishing whether the re-seller Jadranka trgovina imposed unfair trading practices on three suppliers, regarding particularly the content and the implementation of the concluded contracts concerned. In the sense of efficiency, the CCA joined these three proceedings in in one administrative proceeding against the undertaking concerned and brought a single decision in the matter at issue.

The CCA found that in the period from 15 May 2018 to 26 August 2019 Jadranka trgovina made the payments to two of its suppliers and based on 93 invoices outside the deadline prescribed by the UTPs Act. It has also been established that in the same period approximately half of the total of analysed 175 invoices have been payed within the prescribed period defined under the UTPs Act. On the other hand, concerning the late payment, the CCA found that more than third of the invoices have been paid with a delay that was not longer than 10 days.

In addition, the CCA found that Jadranka trgovina failed to define the places of delivery in the contracts with three suppliers concerned. In other words, the place or places of delivery were not a constituent part of the contracts concerned, which constitutes the infringement of the provisions of the UTPs Act that explicitly provides that a place or places of delivery must constitute an integral part of the agreement between the re-seller and its supplier.

Furthermore, the CCA established that Jadranka trgovina has ordered and purchased products not listed in the pricelist one of the suppliers, which also contravenes with the provisions of the UTPs Act, given the fact that the pricelist is a constituent part of the purchase agreement for food products and as such is the subject of the purchase/sale. Concretely, this infringement related to two products that have not been included in the agreement concluded with one of the suppliers concerned.

Therefore, taking into account the gravity, the scope and the duration of the infringement concerned and the consequences for the suppliers, as well as a number of extenuating circumstances, Jadranka trgovina was imposed a fine in the amount of HRK 85,000.

It is the view of the CCA that the fine is proportional to the gravity, scope and duration of the infringement and that it will have a deterrent effect not only on Jadranka trgovina but also on other re-sellers, buyers and/or processors in the food supply chain.

Considering all the extenuating circumstances in the case concerned, the fact that Jadranka trgovina falls under the category of small re-sellers with respect to its turnover and the fact that its retail outlets are located on the islands, which connects its operation closely to tourism, as well as the fact that Jadranka trgovina cooperated with the CCA throughout the proceeding and that the harm caused to the suppliers was not significant, the CCA imposed the fine in the amount that it finds appropriate in this case.

The integral decision of the CCA in this case in the Croatian language is available here: https://www.aztn.hr/ea/ea/ea/ea/wp-content/uploads/2020/11/UPI-034-032018-04005.pdf