Trade discrepancy: FAS stands up for marketplaces in the issue of food sales
The FAS stood up for marketplaces, which had previously been proposed to be equated with offline retail and oblige them to buy products from manufacturers. Such legislative changes are already being discussed in the Cabinet. However, this measure may lead to marketplaces refusing to sell food, representatives of the largest online platforms said. The FAS believes that the activities of retail chains and online platforms vary and need to be regulated in different ways. Retail representatives believe that extending the provisions of the law on trade to the sale of products through marketplaces will ensure safety for consumers and equal conditions of competition. What consequences such regulation may have for the market can be found in the Izvestia article.
What is the threat of equalization of marketplaces and retail chains
The Federal Antimonopoly Service (FAS) does not support equating marketplaces with online retail in terms of food sales. This was reported to Izvestia by the press service of the department, commenting on the proposal to extend the operation of the law "On the Basics of state regulation of trade activities" to the turnover of food through digital platforms. A number of manufacturers and trade associations, including Rusprodsoyuz, the Fish Union, and the Association of Retail Trade Companies (ACORT), applied to the government with such an initiative last week. They proposed to ban marketplaces from selling goods using a commission model, as it currently applies to offline retail: online retail first buys products from manufacturers, and then sells them itself.
The FAS told Izvestia that the government is currently discussing issues related to the regulation of marketplaces between interested authorities and market participants.
— The issue of extending the law on trade to the activities of marketplaces to eliminate inequality in the regulation of the sale of food products is one of the proposals that are being discussed as part of the work on a national model of trading activities, — explained in the FAS.
At the same time, the service stressed that the key difference between retail chains and marketplaces lies in the nature of their activities. The source of classical retail's market power is control over limited shelf space and its monetization, while marketplaces earn money by providing services related to the sale of counterparties' goods to end consumers.
"Therefore, the problems that arise when marketplaces cooperate with counterparties are significantly different from the difficulties in the interaction of retail chains and food suppliers," the FAS noted, adding that the service's position has not changed from the moment when it sounded at the level of retail offers.
The FAS believes that the activities of retail chains and online platforms vary and need to be regulated in different ways, while excessive regulation may hinder the further development of the industry.
Retail and supplier representatives have a different opinion.
The extension of the provisions of the law on trade to the sale of products through marketplaces will ensure safety for consumers, reliable operating parameters for suppliers and equal competition conditions for all trade formats, Stanislav Bogdanov, Chairman of the ACORT Presidium, told Izvestia.
— Retail chains are directly responsible to the consumer for the quality of the goods sold, and provide all control mechanisms. Marketplaces as intermediaries do not bear such responsibility, but at the same time they are a large and fast-growing food sales channel. According to the sites themselves, today millions of Russians in remote regions receive products through order pick—up points," the industry representative emphasized.
At the same time, according to him, the issue of responsibility for the quality and safety of food remains open: according to the law, it must be borne by the seller of the product, and in this case the platform is just an intermediary.
— In our opinion, the fears that the law on trade will block access to marketplaces for small businesses are unfounded. Retail chains have been operating under this law for 17 years, increasing the number of suppliers by hundreds and even thousands of companies every year. According to ACORT estimates, retail chains in Russia work with more than 15,000 food producers, of which more than 60% are small and medium—sized enterprises. So it is quite possible to work in compliance with the requirements of the law on trade," explained Stanislav Bogdanov.
He also noted that the lack of control and obligations to suppliers gives platforms leverage for price dumping, which in the medium term may lead to the disappearance of other sales channels.
— Today's legal inequality in grocery retail does not allow chains that have online storefronts and offline stores to compete on equal terms with platforms due to higher costs and responsibilities. The alignment of these conditions will increase the transparency and security of the grocery trade, as well as maintain high competition in the market. This will keep prices down, which is also a long—term plus for consumers," the retail representative believes.
The law on trade should be extended to marketplaces, equalizing competition with retail chains to eliminate negative practices and maintain market balance, says Dmitry Vostrikov, executive director of the Rusprodsoyuz Association.
— Working under agency agreements (without a trade law) allows marketplaces to shift all costs and risks to sellers: exceed the payment deadlines for delivered products, return unsold products, constantly change tariffs, impose discounts at the expense of the supplier under threat of lowering the rating and search results, break pricing by co-investing in discounts from the platform. All these are risks of suppliers' losses when working with marketplaces and retail chains. If the norms of the law on trade are not extended to marketplaces, then suppliers will not be protected from the market power of electronic platforms," a supplier representative told Izvestia.
According to him, the argument about the unbearable burden for marketplaces in the case of the extension of the law on trade to them does not stand up to criticism, because products account for only 4% of the turnover of online platforms, the bulk is generated in megacities, and not in remote regions.
The editorial board sent requests to the Ministry of Industry and Trade and the Cabinet of Ministers with a request to comment on the situation with the change in legislation.
What are the arguments of marketplaces?
Representatives of marketplaces see more disadvantages than advantages in the changes discussed in the Cabinet of Ministers.
"Digital platforms are inherently different from traditional networks and operate on different principles of interaction with sellers and buyers, so attempts to equate regulation are fundamentally wrong,— the press service of the Combined Wildberries & Russ Company told Izvestia.
They also noted that the proposed changes (the transition from the commission model to the food purchase model) will make this category economically unprofitable for marketplaces and, as a result, will lead to the rejection of its implementation.
— The greatest negative consequences of such "equalization" will affect consumers across the country. We see a 49% increase in demand for food products with a long shelf life in 2025 compared to a year earlier. For residents of remote regions, small towns, villages and villages, marketplaces often become an alternative way to buy a variety of high—quality products, from groceries to baby food," Wildberries& Russ emphasized. — Banning manufacturers from selling their products on marketplaces may deprive them of such a unique opportunity.
In addition, according to the marketplace, this will lead to economic problems in the regions due to a decrease in entrepreneurial activity. After all, such a ban will practically exclude the possibility of developing regional manufacturers: small enterprises do not have the resources to enter the shelves of online retailers.
— Cooper stands for creating equal conditions for all market participants. At the same time, we consider it critically important that new initiatives are aimed at developing and supporting the industry so that consumers can choose among a variety of services and scenarios that are most convenient for them," said Pavel Glukhov, the company's director of government Relations at the service. — Retailers are key partners for us. Our service serves as an additional sales channel for them.
According to him, in this regard, it is necessary to look for balanced solutions that take into account the interests of all parties and at the same time ensure the availability of goods to end users.
Ozon considered the very idea of banning the sale of food products on marketplaces to be an attempt to stop the business development of small regional manufacturers who sell their products on platforms.
— It was online with its endless shelf and minimal barrier of entry that gave equal access to a multi-million audience to small manufacturers who could not get on the shelves of large chains. Currently, more than 48,000 sellers of groceries and other food products are cooperating with Ozon, most of them are SMEs," the company's press service noted.
They added that in case of a ban, many will be forced to close their business.
Georgy Ostapkovich, research director of the HSE Center for Market Research, believes that both sides are right in their own way, but they will never come to an agreement. Therefore, the decision, after weighing the pros and cons, should be made by the regulator in the form of the Ministry of Industry and Trade, the Federal Antimonopoly Service or the government, so that neither business nor consumers are affected, the expert emphasized.
Переведено сервисом «Яндекс Переводчик»
