The Competition Authority warned of the distance for chain market openings and stated that “it is considered that retailers within the same economic integrity within a certain distance may be prohibited from opening a second branch and that these undertakings may be prevented from making a takeover transaction within the same scale”.
In the “Turkish FMCG Retailing Final Report” prepared by the Authority, it was stated that some regulations should be implemented in order to prevent the abuse of buyer power in the sector.
In this context, some suggestions regarding the provisions that should be included in the “Draft Law on Amending the Law on the Regulation of Retail Trade” are listed as follows:
Regarding unfair commercial practices in the draft law, payment terms exceeding 30 days for perishable agricultural products and food products, payment terms exceeding 60 days for other agricultural products and food products, cancellation notices made in a short time for perishable foods, unilateral contract changes of the buyer, loss of Within the scope of the same regulation, it is considered that the return of unsold products, the payment of listing, shelf and stock costs, the prohibition of the supplier from paying for promotion, marketing and advertising, or the fact that retailers may be charged for these matters, only if there is an agreement between the parties. If there is a contract, there is a need to make a regulation that it may be the case.
Demand for independent units for the retail industry
The following statements were used in the report, which requested the establishment of an independent unit to monitor and audit these regulations:
“The unit in question must be structured specifically for the task, have the authority to make complaints or ex officio investigation, have the authority to make unannounced investigations, request information, establish fines, and end the violation directly. The fines to be established to prevent unfair commercial practices must be deterrent. It is thought that the administrative fine should be established over the turnover of the enterprise in order to provide deterrence and that there should be an opportunity to increase the penalty in case of recurrence.
In the report, it was pointed out that linking the new store opening permits of chain stores to the population criterion may have some anti-competitive effects, and therefore it was stated that it would be appropriate not to implement the said regulation.
The report noted the following regarding the distance requirement of chain stores:
“With regard to store openings, it is considered that retailers within the same economic integrity within a certain distance may be prohibited from opening a second branch and that these undertakings may be prevented from making a takeover transaction within the same scale. As a matter of fact, chain stores belonging to the same group can be seen at very close distances to each other in certain regions, This situation may lead to preventive consequences for the entry of a new retailer to that region. Therefore, it is believed that the regulation on the subject will have positive effects on the market in a competitive sense.”
The product announced to be discounted must be in the store
In the report, it was pointed out that some regulations could be made for some practices that may adversely affect the competitive structure of the sector in FMCG retailing or cause consumers to be misled.
In the report, which emphasized that the product should be available in the store during the period when it is announced that it will be discounted (with traditional media, social media or other announcements and advertisements), it is necessary to ensure that the product is sold at the announced discounted price during this period. It is considered that this regulation will benefit both the consumer and the protection of competition.” expression was used.
Specially packaged product notice
In the report, it was stated that it was evaluated that the agreements made for the suppliers to produce special weight products for a single chain market should be prevented, and the following was noted:
“In this context, it can be seen that a certain size of the products, unlike known or standard packaging, can be produced exclusively for one retailer. These practices are becoming widespread in the sector. These agreements are likely to affect competition negatively, and these agreements can also cause various illusions for consumers. Regardless of whether the packaging-size differences can be easily perceived by the consumer, it is considered that the production of a certain packaging specific to only one retailer can be prohibited by a regulation.