Georgian Prime Minister Irakli Garibashvili criticized the often unjustifiably high food prices in the Georgian retail market and instructed the Ministry of Economy and Sustainable Development to urgently draft a bill aimed at reducing them. EastFruit specialists know that the bill, which is planned to be submitted to Parliament soon, will be based on the principles of the EU Directive 2019/633 on unfair commercial practices in relations between companies in the agricultural and food supply chain. It is planned to influence the work of importers and retailers in Georgia through this law.
“The issue relates to the order I gave two weeks ago regarding food and fuel prices. There were several meetings on the matter. The ministers of economy, finance, and agriculture participated in them, and the leadership of the Competition Agency is fully involved, too. A lot of meetings were held both with importers, large chains, and owners of retailers. The picture is the following (I want to explain once again to our people, and society): in total, it turns out that the markup is 70%, 80%, in some cases it increases by 100%, and, of course, this is unacceptable. Therefore, we have now begun active work to regulate. We also listened to the explanations of the importers that there is no profit for them out of this 70%-80 %, because of rules, established by retailers, that is, large chains. These rules are the problem we will address. They have not been tested, and such rules do not apply in Europe. Meanwhile, this issue has been settled in the European Union, and in all Western countries.
Therefore, on my instructions, the Ministry of Economy will draft an appropriate bill regarding the European directive on fair trade. We will continue to work with importers, as well as with representatives of large chains. In addition, we will submit this bill to the Parliament. I hope that the Parliament has the political will and supports the adoption of the European directive and these regulations by us. Otherwise, it would be rude of us to carry out any artificial intervention. Therefore, we have found a way to transfer this practice, which Europe has already passed, to us, to our country. This will introduce fair rules. Importers will have margins, markups, and retailers will have their own set rules. This is the result of this brief two-week work.
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