Household basket’s problems
The “household basket” of supermarket products protected from major price hikes is hitting one snag after another.
As market executives had pointed out from the first moment the relevant initiative was announced, the measure would necessitate the consent both of supermarket chains and suppliers, which in case of illegal collusion would lead to the Competition Commission.
All this in a market that does not show high levels of concentration in any case – the largest retailer, which is Sklavenitis, had a market share of just 31.7% in January-September 2022 – and which due to a decrease in demand sees those involved engaged in a battle to gain or maintain market share while not squeezing their profits too much.
Such is the prevailing confusion that on Thursday, although it had been announced by the Development Ministry, the amendment for the household basket was not submitted in Parliament, as there has been no agreement on the critical details of its implementation. This is now expected in the coming days. Up until Friday afternoon, however, no draft of the relevant legislation or a plan for the main points of application of the basket had been sent to the Competition Commission in order for it to issue an opinion based on what is provided for by law on the protection of free competition.
Although initially the ministry argued that the basket initiative is compatible with competition law, on Friday the prime minister told Parliament that the household basket is subject to the Commission’s approval.
It is recalled that, from the first mention of the plan, the supermarket chains had informed the Development Ministry they would not proceed with the implementation of this action if they did not receive written assurances from the Commission that they would not be accused of collusion or discrimination in the selection of products to be placed in the basket.
The choice of products in turn has led to another problem. Although it had been agreed between the ministry and retailers that the products to be included would not change, after a teleconference with suppliers it was announced that the basket would be renewed.
