Authority denies suppliers ‘hello fees’ claims

THE Competition Authority said its experience does not support the view there are widespread demands on producers to pay illegal “hello fees” to get their products onto shop shelves.

The chairman of the authority, William Prasifka, was responding to allegations retailers were coercing small producers for money to agree to sell their products.

He said it had received “less than a handful of complaints in the last three years”, including anonymous ones which could not be traced.

Mr Prasifka said without an identity the complaint does “not do any good”.

“Obviously we read the newspapers and read the accusations that have been made. But to bring a case people have to come to us.

“There are people who say there is a vast extortion going on,” he said.

The chairman of the authority told the Oireachtas Committee on Enterprise Trade and Employment it was legal for producers and suppliers to pay stores for branding promotion.

This was not against the law unless the stores used coercion.

Fianna Fáil TD Ned O’Keeffe and Labour Senator Brendan Ryan reacted angrily to Mr Prasifka’s explanations.

They, and other members of the committee, said there were reports of widespread abuse of position by large retailers who were charging suppliers to stock goods.

Mr Ryan said he hoped every case was being followed up even if it was only a small number.

But Mr Prasifka assured him all reports were investigated where there was enough information to act.

Mr O’Keeffe said while it may be up to him and his fellow legislators to toughen the law there was still a policing role not being fulfilled.

He said he had spoken to an unnamed Dublin firm that was asked to pay thousands of euro to get products stocked.

Sinn Féin’s Arthur Morgan said he supported the idea of a consumer ombudsman to encourage complaints.

He said if the experience of the authority was that very few people were coming forward than another body was necessary.

The authority was speaking the day after its retail and trade report was released.

The committee expressed regret it was not given enough time to digest its contents before yesterday’s meeting.

Mr Prasifka reiterated the authority’s view local planning laws were contributing to higher prices.

He said because planners did not have to factor competition into their decision big supermarkets were allowed to dominate small towns without a rival.

This did not drive down prices or improve choice, he said.

While he said mainland European-sourcing stores like Lidl and Aldi had been welcome, their market strategy meant the same competition did not exist with recognised brands.