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Office of Competition and Consumer Protection

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UOKiK for agriculture - Döhler's commitment

< previous | next > 29.05.2019

UOKiK for agriculture - Döhler's commitment
  • The company Döhler committed itself to change practices it has applied to fruit suppliers.
  • As a result, farmers will be paid faster for their products.
  • This is the effect of the UOKiK’s decision.

Döhler is one of the largest purchasers of fruit and producer of apple concentrate in Poland. In August 2018, the UOKiK initiated proceedings regarding the company using its contractual advantage against suppliers. The Office questioned too long payment terms in contracts with fruit producers. Döhler required a 90-day payment deadline, while according to Polish regulations payments must be made within a maximum of two months. What is more, the company did not respect such long deadlines it had set itself.

Furthermore, the Office made reservations about provisions that gave the company freedom in shaping prices. As a result, farmers did not know how much money they would get for fruit.

During the proceedings, Döhler voluntarily committed itself to change its practices. The Office decided that it would help to quickly eliminate practices unfavourable to farmers. What is important, this commitment applies to both the enterprise and its subsidiaries, namely Zak³ad Przetwórstwa Owoców i Warzyw Polkon (the Polkon Fruit and Vegetable Processing Plant) and Alpex.

The decision will significantly improve the situation of farmers acting as Döhler’s contractors because they will receive money for delivered products faster and the minimum price for fruit will be set. The changes will be introduced as early as during this year’s harvest, says the President of UOKiK, Marek Niechcia³.

What is Döhler committed to do?

In line with Döhler’s commitment, payment terms will be shortened. Farmers operating based on flat rate will get their money within 30 days of delivering the fruit, while suppliers conducting business activity - within 60 days from delivery of invoice issue date. The enterprise also promised that an independent company would audit all payments made from July 2017 to May 2019. If the audit reveals delays, Döhler will pay interest to suppliers.

The company will also change the pricing principles. First and foremost, the minimum rate for delivered products will be introduced. It will be set before harvest, either by the end of May (as for soft fruits) or by the end of July (as for apples). If a given farmer does not accept the price, he will be able to terminate the contract he had previously entered into without any consequences.

In addition, Döhler committed itself to make it easier for suppliers to use their Supplier Financing Programme, which allows them to receive money before the due date. Most of all, the company will reimburse the contractors for the costs of running a bank account necessary to participate in this programme. The enterprise will also conduct four trainings during which it will clarify the principles of the programme. During the trainings, it will also explain to entrepreneurs buying fruit from farmers the need for timely payments to eliminate delays.

These are not the only actions taken by the Office on the agricultural and food market. We have analysed contracts of other companies operating on this market and called 13 of them to change the provisions and practices unfavourable to farmers. The decision in the Döhler case may be a sign for them of how a contract with suppliers should be drawn up, says Marek Niechcia³.

The cases of contractual advantage are handled by the UOKiK Branch Office in Bydgoszcz. You may report your problem anonymously:

  • or by phone at the following number: 52 345 56 44

 

Additional information for the media:

UOKiK Press Office
Pl. Powstañców Warszawy 1, 00-950 Warszawa, Poland
Phone +48 695 902 088, +48 22 55 60 246
E-mail: [SCODE]Yml1cm9wcmFzb3dlQHVva2lrLmdvdi5wbA==[ECODE]
Twitter: @UOKiKgovPL

Attached files

 

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