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AIM calls for EU investigation into European Retail Alliance AgeCore as French authority targets it and Intermarché for unfair trading practices imposed on suppliers, seeking EUR 150 million fine
Press Release, Brussels, 19 February 2021 – The French government today has acted on the abusive unfair trading practices imposed on 93 suppliers by French retailer Intermarché through its international alliance, AgeCore, and Intermarché Belgium. Seeking a fine of over 150 million euros (1% of Intermarché’s turnover in France), the government is taking action on retailers’ abuses committed downstream, which have adverse consequences for all in the supply chain, as well as serious repercussions for the proper functioning of the French economy.
AIM, the European Brands Association, welcomes the action taken by the French government, and calls upon the EU to take similar action and investigate AgeCore’s activities in Europe, given it operates in Germany, Italy, Spain and Belgium, as well as France.
“France is one market and whilst we applaud the French government for taking this initiative, the impact of AgeCore’s abusive behaviour across the entire EU market and subsequent consequences for suppliers and consumers is potentially enormous”, commented Michelle Gibbons, Director General of AIM.
The abusive behaviour of European retail alliances, including AgeCore, in their role as gatekeepers determining access to, and the proper functioning of, EU markets is an increasingly problematic issue for the EU economy. “The pressure these gatekeepers impose with their business model – literally stopping orders and taking brands off shelves (de-listing) or threatening to do so if suppliers don’t pay up – has an anti-competitive effect on the market, the supply chain, and ultimately consumers lose out” remarked Ms. Gibbons. “We need a fair and competitive trading environment to ensure that we can deliver for consumers, maintain a resilient supply chain and continue to invest and innovate to meet the EU Green Deal objectives and restore the EU economy”.
AgeCore, which is based outside the EU in Geneva, has an impact through its membership in no less than nine EU Member States: France, Germany, Italy, Spain, Belgium, Luxembourg, Portugal, Poland and Romania. Its members are Intermarché, Colruyt, Edeka, Conad, Eroski and Coop Switzerland. These members hold formidable market shares, with Edeka controlling circa 25% of the market in Germany, Conad 17% in Italy, and Intermarché circa 14% in France. AgeCore operates a 'gatekeeper' system that creates barriers to markets – if suppliers do not agree with AgeCore's terms, the gates are shut at national level. Furthermore, if suppliers do not agree with a retailer in one market, they are then shut out of other markets.
"The EU is focusing its attention right now on the role of platforms as gatekeepers online, and their potential behaviour in unfair trading practices – it needs to address the same attention to the offline, bricks-and-mortar world where abuses are occurring daily because of gatekeeper behaviour", observed Ms. Gibbons.