Big Russian multiples coming under government's fire for retro-bonuses

February 5, 2009 16:34

Moscow's largest wholesale chains of Metro Cash & Carry has introduced retro-bonuses for their customers, the measure causing disapproval by the Head of Russia's State Fisheries Agency Mr. Andrey Krainy, reports ( with reference to Novyi Region.

More specifically, Metro has introduced retro-bonus meaning that the chain's suppliers have to transfer 20% of their proceeds to the chain based on the annual sales result. Besides, if the suppliers sell their goods in other retail chains at higher prices than those in Metro Cash & Carry, one half of their margins shall be also transferred to Metro, otherwise Metro will be shut down for them.

Auchan chain acted in a similar way one year ago, when before its birthday suppliers received letters with requests to transfer RUB600,000 as a gift for the chain.

In early February 2009 Russia's Federal Anti-Monopoly Service introduced an amendment to the Criminal Code of the Russian Federation stipulating that barriers to free trade will be first punished by two administrative fines and the third case will cause criminal proceedings.

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