The aim of the protection of market competition is primarily to create benefits for consumers and equal conditions for all entrepreneurs on the market, who, acting in accordance with the existing rules and competing on the market with the quality, price and innovation of their products and services, contribute to the overall development of the economy.

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CCA fines fruit buyer Moslavina voće HRK 75,000 for imposing unfair trading practices on plum suppliers

The Croatian Competition Agency (CCA) opened ex officio infringement proceeding against the plum buyer Moslavina voće 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 this buyer of plums used its strong bargaining power and imposed unfair trading practices on its suppliers.

The investigation showed that Moslavina voće used its strong bargaining power and imposed several unfair practices on its plum suppliers in the harvest season of 2018.

Moslavina voće made business deals with its suppliers of plums based on standard purchase agreements that did not clearly define the price and/or provide the method for calculation or correction of the price, given the fact that the price defined under these SPAs was not in compliance with the provisions of the UTPs Act. In addition, a number of SPAs did not include mandatory provisions on the type of agri or food product that was delivered to the buyer nor the conditions and terms of delivery for these products.

Furthermore, Molsavina voće imposed unfair trading practices on two suppliers that lead to the reduction of payment to the prejudice of the suppliers and caused a non-transparent fall in the value of plums – the calculation of the discount for early payment (cassa sconto) in one case, and the non-transparent reduction of the price as identified in the pricelist in effect in another case.

Finally, CCA found that Moslavina voće made payments to some of its suppliers over the period exceeding 30 days from the date of the receipt of the plums or the invoice, which contravenes with the provisions of the UTPs Act and constitutes an unfair trading practice. The analysis of 98 invoices/purchase orders revealed that 13 were paid outside the mandatory payment deadline under the UTPs Act.

Taking into account the gravity, the scope and the duration of the infringement concerned and the consequences for the suppliers, and a number of extenuating circumstances, Moslavina voće was imposed a fine in the amount of HRK 75,000. The CCA found the fine proportionate to the infringement and that it will have a deterrent effect not only on Moslavina voće but also on other actors in the food supply chain.

The CCA also ordered Moslavina voće to supply evidence confirming that its operations have been brought into compliance with the UTPs Act.

The total amount of the fine has been paid by Moslavina voće.