New legislation to replace the Irish Republic’s controversial groceries order has been attacked as “unfair and unbalanced” by RGDATA, the independent grocers’ lobby.
The Bill, published this week (Monday) by trade and enterprise minister Micheál Martin, revokes the ban on below-cost selling while beefing up competition law in a bid to ensure fair trading for all.
But RGDATA complains that the legislation contains no provision to deal with predatory pricing and is demanding that this be specifically prohibited.
“If this legislation is passed, it means a large retailer can target a smaller one with sustained predatory pricing,” said RGDATA director general Tara Buckley.
“We are not talking about normal price competition, but predatory pricing, where the object is to deliberately target a smaller competitor and drive them out of business.”
Under the Martin legislation, suppliers and producers will be prohibited from specifying the retail price of their goods.
“Hello money”, which retailers demand from suppliers to stock their products, will also be outlawed, as will retailer demands that suppliers subsidise advertising.
The regime will be policed by the Competition Authority and the legislation provides for court action and damages in cases where a breach of the law has resulted in a loss of business or of livelihood.
However, RGDATA claims that predatory pricing would be illegal under the new law only when carried out by a company “deemed to be dominant”.
The minister’s department, it says, has defined “dominant” as a market share of not less than 35%, and it adds: “Given that none of the major retailers in the Republic of Ireland has a market share of over 27%, they will be free to engage in predatory pricing.”