Biedronka, one of Poland’s biggest supermarket chains, could face a fine for an anti-inflation promotion that the consumer watchdog claims were misleading. UOKiK reported the amount could amount to as much as 10% of their annual revenue.
As part of the promotion, which ran from April to June, customers were encouraged to compare prices and receive a refund if any 150 products were cheaper elsewhere. However, UOKiK noted that the rules were complex, and customers couldn’t use their coupons immediately after receipt.
UOKiK fines Biedronka
Biedronka, owned by Jeronimo Martins Polska, is facing a fine from Poland’s competition protection authority for its anti-inflation promotion. The store is running a campaign guaranteeing certain items at their current prices until JUOKiK believes this needs to be revised and is investigating whether the campaign infringes upon consumer rights.
UOKiK’s president claims Biedronka’s offer was deceptive. The company failed to include the “service maintenance” fee in the prices of their offers, causing confusion when consumers sought out the most profitable option. Furthermore, the porno website needed to inform customers about its costs and features.
In response to these allegations, UOKiK president Vlado Smolinski imposes fines on businesses that fail to uphold their statutory obligations. These sanctions serve as punishment for breaking the law and deter others from repeating similar offenses in the future.
UOKiK has recently been actively engaged in consumer protection and e-commerce due to changes to legislation that aim to safeguard online consumers’ interests. E-commerce businesses must ensure that website promotional prices are presented efficiently and transparently without using clauses that could distort consumer choice.
They must also ensure that other users’ opinions on their websites are reliable. These actions are part of UOKiK’s evolving activity, which strives to provide that online stores present content truthfully and honestly.
At UOKiK’s investigations, the economics department provides a second set of eyes. They prepare analyses and research the state of markets that may be vulnerable to distortion due to competition.
Mr. Wojciech Szymczak, Ph.D., supervises this unit responsible for competition and consumer protection matters at UOKiK. It boasts a significant workforce with an annual budget of 101 million zlotys and 591 employees.
Biedronka says it will appeal
Tomasz Christy, president of the Polish antimonopoly office, has issued a fine to Jeronimo Martins Polska for failing to display prices accurately on some goods in Biedronka stores. Consumer complaints revealed that some goods did not match what was on display or didn’t indicate their respective costs compared to other supermarkets.
UOKiK also asserted that consumers were being charged more at the checkout for identical goods than those available on the shelf, which they claimed violated the law. UOKiK also discovered that their campaign, which ran from April to June, may have misled consumers. It noted that regulations made claiming a refund much more complex than what the ads might suggest.
“Biedronka is deeply disappointed,” the company stated in a statement. It plans to appeal the ruling and appeal the court’s decision. The company asserted the fine was discriminatory and excessive, indicating a lack of goodwill in UOKiK’s case handling.
Biedronka recently unveiled 50 Private Brand products and introduced a personalized app that enabled users to find the best offers and campaigns, view their purchase history, and check the prices of products on sale in-store.
It was part of an anti-inflation promotion, which offered customers who purchased certain essential goods a refund if they found them cheaper elsewhere. But, unfortunately, UOKiK discovered that customers couldn’t take advantage of this offer due to rules requiring them to buy both from Biedronka and another shop within one week of each other.
However, Biedronka has saved Polish families over PLN 17 billion since 2017, as the Office of Competition and Consumer Protection reported. This success can be attributed to advertising campaigns within their chain which guaranteed price protection on essential items until June 2020.
Biedronka says it has complied with the law
On April 12th, UOKiK launched a campaign to guarantee prices would increase on June 30th and offered refunds if consumers found cheaper products. Unfortunately, the rules made receiving a refund more challenging than what the company’s marketing might have led customers to believe, according to UOKiK.
Biedronka’s suppliers – particularly those of fruit and vegetables – only know the discount amount after deliveries have already been made. Therefore, these suppliers cannot estimate how much a customer might save, potentially missing out on potential sales opportunities.
A spokesperson for the chain told Datezone they were working on a solution to address regulator concerns. Furthermore, they mentioned they were in talks with suppliers to simplify the process.
In Poland, Sunday trading is strictly forbidden by a national-conservative government led by Law and Justice (PiS). Unfortunately, some stores exploit loopholes in the law to open on Sundays and sell goods. This week Family Minister Magdalena Malag announced a roundtable to remind stores of their obligations to adhere to these restrictions.
This policy has led to workers’ protests across Poland as workers seek higher wages, benefits, and rights. The ruling party PiS has promised an increase in the minimum wage by 90% – up to 4,000 zlotys (EUR 930 or $1,050) per month.
A recent survey of employees from six of Poland’s major retail chains – Auchan, Carrefour, Makro Cash&Carry, Real, Tesco, and Biedronka – revealed weak employment relations. Nearly half of the employees interviewed believed there was no trust between them and their employers. At the same time, only 40% felt they had a stable relationship with them.
Biedronka says it is working on a solution
According to the regulator, Biedronka’s campaign was intended to recoup some costs associated with its prices rising faster than suppliers’. Furthermore, it violated laws against selling goods in stores not open to the public.
According to the regulator, Biedronka had to pay a fine of almost 30 billion zlotych (EUR12.3 million). These penalties stem from an investigation that began in July.
According to Pawe Niechcial, a representative for UOKiK, one primary reason for the fines was that Biedronka failed to inform its suppliers of how much money it was saving them. Doing this would have ensured that suppliers knew their discounts were being given for good value rather than simply because of an overly optimistic marketing approach.
However, Biedronka has come under fire from many critics. One prominent voice is Poland’s leading wine website Winicjatywa, which has consistently questioned the quality of some of Biedronka’s high-end items.
For instance, it has been claimed that some of the wines in this range taste virtually identical from bottle to bottle. Furthermore, the promotion was claimed to be an error since it must be thoroughly tested before going live.
In an interview with Reuters, Biedronka spokesperson Wiadomosci Handlowe indicated the company is actively searching for a solution. In the meantime, he said, they plan to move into The Warsaw HUB complex, which is being constructed in the Wola district of Warsaw.