Communication
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.
Unfair trading practices: CCA imposes HRK 60,000 fine on mandarin oranges buyer FILIP
The Croatian Competition Agency (CCA) opened ex officio infringement proceeding against the mandaring oranges buyer Filip 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 mandarin oranges used its strong bargaining power and imposed unfair trading practices on its suppliers.
By carrying out the analysis of 203 purchase orders the CCA found that Filip made payments to 24 suppliers over the period exceeding 30 days from the date of the receipt of the mandarin oranges, which contravenes with the provisions of the UTPs Act and constitutes an unfair trading practice. At the same time, the payment to one supplier has not been made at all.
Filip made business deals with 29 suppliers 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.
Besides the above-mentioned, the CCA also found that in business transactions with 2 suppliers, when calculating the price of mandarin oranges that had been identified in the pricelist, Filip subsequently reduced the value of the agricultural product of a standard quality in a non-transparent manner in 26 purchase orders in a defined purchase period, which also constitutes an unfair trading practice and a serious infringement of the UTPs Act.
Finally, Filip violated another rule relating to the invoice issuance, namely, the CCA found that Filip provided transportation services from the field to the place of purchase that were not agreed under the SPAs with 2 suppliers. Filip failed to issue invoice for these services, which constitutes the infringement of tax rules and the UTPs Act.
The serious infringements of the UTPs Act were committed in the period from 20 September 2019 to 31 December 2019.
Taking into account the gravity, the scope and the relatively short duration of the infringement concerned and the consequences for the suppliers, and a number of extenuating circumstances, Filip was imposed a fine in the amount of HRK 60,000. The fine will have a deterrent effect not only on Filip but also on other re-sellers, buyers and processors in the food supply chain.
The integral decision of the CCA in this case in the Croatian language is available here