Bulgaria's Consumer Protection Commission (KZP) has fined big retail chains up to €35,000 for unfair trading practices, its chair Maya Manolova said. Inspectors found the violations in checks over the past two weeks.
The KZP, the Ministry of Agriculture and Food, the Bulgarian Food Safety Agency and the National Revenue Agency are carrying out the checks together. On October 29, agriculture minister Plamen Abrovski said the revenue agency was joining in to trace mark-ups from the producer to the retail chains.
How it all started: Tax agency joins checks on markups, from producers to retail chains
Manolova said the big chains have committed many violations. She said that for the first time the whole state, through its institutions, is tackling high prices.
Fines for unjustified price rises range from €10,000 to €100,000. Manolova explained that such a violation is hard to prove if the price went up more than a year ago. She believes the problem is not only the current rise but also the high prices already reached.
If the chains appeal, Manolova will also defend the penalty decrees, the documents that impose the fines, in court. She said traders are wrong if they think the penalties will easily be dropped: they are fully deserved.
She rejects the chains' explanation that prices in Bulgaria are higher mostly because of different tax rates, a lack of raw materials and costlier deliveries. She said mark-ups on mixers, lawn mowers, electrical appliances, shampoos, soaps, conditioners, avocados, mangoes, caviar and salmon are not capped, but staple foods on Bulgarian tables should carry normal mark-ups.
Manolova said different chains put very different mark-ups on similar products in the same group. She gave imported Gouda and Bulgarian kashkaval as an example and said this is why the kashkaval costs more.
The KZP has sent the Commission for Protection of Competition (KZK) material from the checks that points to suspected unfair practices by the chains towards Bulgarian producers. For violations the KZK examines, fines can reach 10% of turnover. Manolova said the chains squeeze producers by buying vegetables below cost and preferring imports, and that soon there may be no one left to grow them.
The KZP is also watching prices of over-the-counter medicines and food supplements. Manolova said some of them cost twice as much in Bulgaria as in Greece. She named painkillers, flu remedies, syrups and drops, which people look for at the start of winter.
A full review of the rules on medicines is due. It should show where prices rise the most: in production, wholesale trade or pharmacies.