CPC opposes lower prices for basic food items

CPC opposes lower prices for basic food items

Antimonopoly regulator stops the initiative of the Ministry of Economy “Affordable for you”

After meetings with representatives of food chains at national and regional level, the Ministry of Economy and Industry agreed in principle to include the representatives of the country’s retail chains in the Affordable for You initiative. The initiative aims to provide Bulgarian consumers with about 50 products from the small consumer basket at the best possible price in the entire retail network in Bulgaria. It is based on the principle of voluntary partnership in synchrony between the state and business. In the course of the discussions, a number of enquiries were also received from non-food chains as well as representatives of pharmacy chains to join the initiative.

Although the initiative does not oblige the participants to maintain certain prices, but on the contrary stimulates competition between them in certain food groups, an opinion was requested from the Commission for Protection of Competition (CPC).

The opinion received by the ministry makes it clear that “the inclusion of food retailers in the initiative is linked to offering food at an undercut price, which will lead to a restriction of price competition between these retailers.” The CPC also points out that “the initiative launched by the Ministry of Economy is related to a coordinated and simultaneous lowering of prices of several groups of food products, which violates the principle of free economic initiative, enshrined in the Constitution of the Republic of Bulgaria.” According to the CPC, a possible measure to deal with the price increase would be to “provide individual food packages and hot lunches”.

“The Ministry of Economy will not give up looking for solutions, through market mechanisms in full compliance with the law, so that Bulgarian citizens can get products at the best possible price in the entire retail network in Bulgaria,” Minister Bogdanov said.