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Business • August 8 2004


Group of eight supermarkets under investigation

Julian Manduca

The eight supermarkets that joined forces, in part to counter the low prices of one of their competitors, are being investigated for possibly creating a dominant or monopolistic situation in the market.
Marcel Pizzuto, Director General Consumers and Competition within the Ministry for Competitiveness, said his office is investigating adverts placed by the supermarkets regarding certain prices. “We are looking at the law to see if the agreement between the supermarkets is creating a dominant situation in the market,” Pizzuto told our sister newsaper The Malta Financial & Business Times.
The supermarkets have organised a joint advertising campaign in response to the low prices of some of the products of new kid on the block SISA supermarkets. SISA, which sells its own branded imported products, has been delivering colour brochures advertising its low prices including some which are priced lower than cost price.
The eight supermarkets, Tower, Shopwise, Shoppers, Trolees, Park Towers of Fgura and St Julians, Lasco, and Carters were already gearing up for the challenges of EU membership and SISA’s appearance must have given them added impetus.
Shortly after SISA’s brochures appeared, the group of eight reacted in kind, with a larger brochure, matching SISA’s prices and even bettering them on some products. Both SISA, and the group of eight were offering 250 Lion Tea bags at Lm1.28 and 200g Nescafe jars at Lm1.19 – both lower than cost price.
The supermarkets have since formed a company - Retail Marketing Ltd - and are now acting as one entity. They are also not obliging any of the supermarkets that make up the company to stick to the offers published in the brochures.
A representative of the group of eight supermarkets, explained that the new company is still finding its feet in new circumstances since Malta joined the EU. The representative said it was studying its legal position and would ensure that its policies do not conflict with laws related to competition.

 

 

 

 





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