The government will not back down to Kaufland, economy minister Alexander Pulev said. He was replying to Mihail Petrov, the chain's chief executive, after the regulator fined the company.

Petrov said the state must stop because the chain is very big. If Kaufland collapsed, he said, the failure of Corporate Commercial Bank (KTB) would look like a spring breeze.

Pulev called the chain's tone arrogant and disrespectful towards the government, institutions and independent regulators. He said he is calm and sees no reason to worry about such a tone.

The government is going after unfair trading practices, not the chains, the minister said. In his view, Kaufland had two choices after the fine: admit weaknesses in its management and the conditions that allow unfair practices, and fix them for the benefit of shoppers and producers, or react with arrogance and aggression. The chain chose the second, he said.

The market in Sofia is lucrative and liquid, Pulev explained. If one chain gives up ground, its rivals will fill the gap within a few weeks, and that is normal free competition, he said.

The minister called on Petrov to stop threatening the state and to look at the figures on foreign investment. The latest data for this year show direct investment in Bulgaria is up 100%, meaning it has doubled over the period.

The cabinet's steps and the reforms due in parliament target market distortions, unclear pricing and unfair practices, Pulev added. He said the government is already acting.