Multinational companies counterattack for fines – frontal with government

As inflation in our country begins to rise again, while at the same time falling in the Eurozone, the government has chosen to clash head-on with the multinational groups, with the Prime Minister himself declaring that Greece is “not an independent country.” banana”.

In the midst of this new wave of price rises and the fact that two years of uncontrolled prices of food and basic materials continue to affect household incomes, Development Minister Kostas Skrikas imposed a huge fine on Procter & Gamble and Unilever in the amount of 2,000,000 euros for unfair profiteering, from 1,000,000 euros to 1,000,000 euros. Every company.

From this research it emerged that laundry detergent in Greece is sold at a price up to 361% higher than in the cheapest country in the European Union.

These are the same companies that were included in the investigation conducted at the beginning of the year by the Competition Commission regarding the selling prices of washing machine detergents in capsules (pods) and washing powder (powder).

This research found that laundry detergent in Greece is sold at a price up to 361% higher than in the cheapest country in the European Union. It is Ireland. Procter & Gamble and Unilever of Greece control a 66% stake.

counterattack

For their part, the multinational companies that own dozens of brands and stocks dominate supermarket shelves are determined to confront the “attack” by any means possible.

According to reliable sources, in addition to the appeal to the courts to impose the fines – Unilever has already announced this – there will also be an appeal against the law itself, arguing that the method of calculating the penalties is incorrect.

Unilever is moving in exactly the same direction, with sales in 2021 amounting to 352.7 million euros, compared to 331.6 million euros in the previous year and a significant increase in results after taxes, reaching 20.8 million euros, from 12.1 million euros in 2020.

As it stated in its statement yesterday after the imposition of the one million euro fine, “We understand the rationale for the ministerial decision on maintaining the gross profit margin, and we disagree with the methodology on the basis of which the audit authorities calculated the fine.” Without taking into account the basic criteria for the operation of the retail market and accounting standards.

Procter & Gamble, whose net sales in the period 6/30/2021 – 6/30/2022 amounted to 276 million euros and its net profits increased 4.4 times to 14,169 million euros, has not made any official announcement on whether it will appeal against the fine of 1 million euros. . However, market circles consider this almost certain.

However, Unilever announced yesterday that it intends to cut prices by 5% for 6 months in more than 80 codes, while Procter & Gamble has already cut prices in 71 of its codes.
In any case, the government’s position remains toward continuing controls and imposing fines “without hesitation.”

Confidential treatment

Discomfort among multinational consumer product companies is intense, and there is talk of discriminatory treatment by the government, even accusations of populism. This is because, they say, Greek companies, at least rhetorically, remain in the fireproof zone.

Naturally, Greek businessmen for their part respond that they have become an “easy victim” in terms of controls, as multinational companies have very great capabilities to manage their cost data.

According to regulated retail managers, in consumer products other than food, multinational companies hold the lion’s share on Greek shelves, about 90%. It’s also strong in the food categories, but there’s also a strong Greek presence there.

Doubt

Meanwhile, executives from the investment community express strong doubts.

Reliable sources reported to OT that the conflict practices chosen by Maximus increase the risk of Greece turning from an “investment paradise” with an emphasis on production into a “kingdom of money” but even in this case the “quarrels” spoil the climate by making it difficult to approach investors. potential, and create second thoughts.

They rightly point out that the Greek market, due to its size, is not a major priority for large multinational companies in terms of production. They even mention that from day to day many factories of foreign groups are closed in Greece, with production being transferred to other countries.

It should be noted that fines have already been imposed on three leading multinational companies (there was previously a €230,000 fine on BIC for selling school supplies at a higher profit margin), while checks are currently underway on 5 other groups active in the goods sector. Daily consumption as well as in the food and beverage sector.

From the checks involved, it appears that the two were completed immediately and it is possible that there will be new fines.

source: after that