Russian competition authorities have launched an investigation into the dealing between retailers and suppliers, including Metro Cash & Carry.
The Federal Antimonopoly Office (FAS Russia) said that it will inspect contracts concluded between retailers and suppliers since February as it looks to enforce the country’s new law on trading.
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Last month, new regulations came into force that are designed to tighten the controls of retailers’ contractual and financial dealings with suppliers, including deadlines for the payment of suppliers.
Speaking at a session of the Expert Council on Developing Competition in Retail, Andrey Kashevarov, deputy head of FAS Russia, said that retailers who concluded contracts after 1 February that were in breach of the regulations would be subject to penalties, even though penal sanctions for non-compliance are yet to be approved.
“We will react, without any delay, to how the Law on Trading, which came into force on 1 February 2010, is observed. Even though penal sanctions for non-compliance have not been improved yet,” he said.
“Now there is a transitional period, during which retail chains can adjust their contracts to comply with the new law. In the second part of 2010 we plan to conduct countrywide inspections of retail chains,” he revealed.
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By GlobalDataIn the first six months of 2010 the antimonopoly authority would carry out an anonymous survey of suppliers to find out how their relationship with retail chains changed, Kashevarov added.
According to Kashevarov, FAS Russia received complaints alleging suppliers imposed disadvantageous contract conditions between 2008 and 2010, and is inspecting Metro Cash & Carry, the wholesale arm of German retailer Metro Group.
Retail operators have until 1 August to renegotiate contracts with their suppliers based on the new rules.
