Crossroads in the stock market, the action will rush after the offensive of Berca

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Carrefour’s share price fell by more than 9% on Tuesday, June 18, 2024. The drop follows Bercy’s announcement that it considers the retailer’s relationship with the managers of its franchise stores unbalanced and recommends a fine of 200 million euros.

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– The Ministry of Economy recommends a fine of 200 million euros against Carrefour.

The Ministry of Economy assessed Carrefour’s relationship with the managers of its franchise stores as unbalanced and recommends a fine of 200 million euros, causing the distribution giant’s share price to plummet on Tuesday, casting doubt on Bercy’s conclusions. THE practice of Carrefour to its franchise partners “characteristics of restrictive competition practices” AND “consist very specifically of suffocating franchisees using a position of strength”, estimated the services of the Ministry of Economy in the conclusions of the voluntary intervention, which were revealed on Tuesday by the media La Lettre and which AFP could consult. Group included action down more than 9% at the opening of markets and hit a low since November 2020 at 13.14 euros, Bercy contested Tuesday’s conclusions with AFP.

These conclusions come as part of a challenge based on “Carrefour Franchisee Association”, which brings together disgruntled franchise store managers, and filed at the court in Rennes. These franchisees criticize “significant imbalance” in the franchisee/franchisor relationship with Carrefour. Bercywhich is mainly based on a survey carried out by DREETS (Regional Directorate for the Economy, Employment, Work and Solidarity) in Normandy between July 2019 and March 2022, notes that in the contracts between Carrefour and its franchisees, “numerous obligations restricting their freedom and commercial autonomy, disproportionate to the usual operating rules of the franchise and the use necessary to preserve the brand used”.

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Civil fine of 200 million euros

“Such practices are contrary to public economic policy and justify the imposition of a civil penalty” in the amount of 200 million euros, clarifies Bercy, who also recommends that the order to stop illegal practices that should be “done immediately” it is supplemented after the verdict is announceda fine of 50,000 euros for the day of delay from the notification of the judgment to be pronounced by the Court of Rennes. These conclusions are without prejudice to the decision of this Court. The pillar of the Carrefour group’s strategy is franchising, which allows maintaining and expanding the sales area without incurring numerous store operating costs.

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