A much-hyped government inquest into charges that several of Hungary’s larger food retailers engaged in predatory pricing and abused their suppliers has ended in a verdict of not guilty. According to a report in business daily Világgazdaság, the committee set up by Hungarian Prime Minister Ferenc Gyurcsány to investigate the retail trade sector found that while suppliers may be “defenseless,” the big retail chains do not abuse their dominant position. The investigation was seen by many as a concession to struggling domestic food producers, many of whom blame their troubles on the large and often foreign-owned retailers that Hungarian consumers are increasingly flocking to.
The investigation focused on Tesco, CBA, Coop and Real, which have a combined 30% share of the Hungarian retail market. The committee said it found no evidence of any abuse of market power, though conceded that the structure of the retail sector makes proving the existence of such infractions difficult. It said suppliers were protected by Hungary’s prohibition on selling goods below costs, and other sections of the retail law that limit the potential for abuse by big chains. The report also said that rulings by the Competition Office (GVH) were in line with competition law.
The concentration process in the domestic retail sector has largely been completed, but suppliers have yet to undergo the same process, especially in the food business, the committee found. It said that while the government may need to provide “targeted assistance” to weak businesses in the sector, its options for helping out are limited.
