Hungary: Investigating the food sector

Last year, the Hungarian Competition Authority (“GVH”) commenced a series of consultations to identify the markets most impacted by competition law violations and to raise awareness among businesses of its significance. The main reasons were to: explore the causes behind the high inflation of food prices, analyse price increases which may violate competition law, and address market issues or imbalances with any available legal solutions.

These consultations aim to map the domestic market by calling on market players affected by price rises and their representative associations to consult each other.

Investigation into food retail sector and accelerated sector inquiry into dairy products

In the middle of January 2023, the GVH launched an investigation into the practices of the food retail chains sector, analysing market signals to assess if any violations of competition regulations or distortions of competition may be driving the noticeable rise in food prices.

The GVH is currently looking into the domestic trade of food items, particularly in relation to price-capped products due to the recent rise in prices of other food products. The GVH will be assessing whether any competition rules have been contravened in the retail sector and if any violations exist that could lead to antitrust proceedings.

The GVH will examine the data collected from market players to determine the cause of the price increases, and to take corrective action if necessary. The investigation will focus on the pricing and sales tactics of large domestic food retailers. Individual complaints submitted to the GVH will also be considered.

A few days following the start of the investigation into the food retailers market, the GVH has also announced the launch of the accelerated sector inquiry into dairy products focusing on the surge in the prices of every-day dairy products. For more background on the nature of the accelerated sector inquiries you may read our previous summary.

As food inflation is said to be a priority for the GVH, similar investigations and sector inquiries are expected to follow, posing significant risk to any companies failing to comply with competition law and the practice of the GVH. It is advisable for businesses to closely monitor developments and prioritize adherence to regulations.

For more information, please contact Dániel Arányi, Gábor Kutai or Dorottya Nagy.

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