Largest Russian retailers failing to comply with new trade law regulations

2010-08-03

The four largest retailers operating in Russia – X5 Retail Group, Sedmoy Kontinent, Auchan and Metro – have failed to renew their contracts with all of their suppliers, as required by the new Russian trade law, which was brought into effect on 1 August 2010. Under the new law, agreements between retailers and their suppliers can include a maximum value discount of 10%. Any additional conditions based on marketing, logistics and other features, which were previously acceptable, are now forbidden.
The retailers in question insist that they do not intend to act in contravention of the law and deliveries from those suppliers with whom new agreements have not yet been signed have been suspended. According to the retailers’ estimates though, this has affected only around 1-5% of normal supplies.