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Saturday, July 20, 2024

Grocery store chain hit with major fine

Norges Gruppen, the grocery retailer and wholesaler that dominates the Norwegian market, is considering a legal appeal after being hit this week with a major fine for allegedly violating Norway’s competition laws.

The state competition authority (Konkurransetilsynet) claims that Norges Gruppen broke the rules when it took over and started operating 22 of 24 ICA Maxi grocery stores in April 2012, before the authority had ruled on the deal. The state has thus issued a fine of NOK 25 million (USD 4.1 million) against Norges Gruppen, which already owned several other grocery store chains in Norway including Meny, Kiwi, Joker, Spar and Centra.

Magnus Gabrielsen of the competition authority told newspaper Aftenposten on Friday that the intention of the law is for the state to evaluate such transactions before they are put into practice, “so that we can halt activity that hinders competition. It’s important that these rules are upheld.”

NorgesGruppen’s management claims they’re on “safe legal ground” because they simply bought leasing contracts and property where the stores were located, and may challenge the fine in court. A professor at business school BI claimed the law is unclear on the issue, and both sides may benefit from a clarification in court.

It’s the latest challenge to NorgesGruppen’s dominance in Norway, after competition authorities ruled against another purchasing deal struck between the major retailer/wholesaler and ICA Norge earlier this month. That’s also under review. staff



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