French retailer Carrefour on Tuesday said that it would reject the Business Competition Supervisory Commission’s (KPPU) demand that it change its business practices, challenging the KPPU’s ongoing probe into the company’s alleged monopolistic behavior.
“From the start of the investigative process, we have rejected all of the KPPU’s allegations, because according to our data, Carrefour has not taken a dominant market share in this country,” Carrefour lawyer Ignatius Andy said after a KPPU hearing.
The KPPU has accused Carrefour of monopolizing more than 60 percent of the retail supply sector and 48 percent of the consumer hypermarket sector after it acquired retailer PT Alfa Retailindo from PT Sigmanara Alfindo in 2008.
“The 60 percent-plus [of suppliers] increased from below 40 percent before the acquisition, and the 48 percent [of retail customers] increased from 36 percent,” KPPU’s investigative team leader Dedie Martadisastra said.
If Carrefour doesn’t change its practices, the retailer would be able to lock up traditional supply channels, Dedie said.
By pushing down prices paid to suppliers, Carrefour was also able to reduce consumer prices, undercutting traditional markets, Dedie said. “It would have harmed them.”
But Irawan Kadarman, Carrefour’s corporate communications director, refuted the claims. “We’re not taking a dominant market share,” Irawan said.
The KPPU said it would pursue legal action if Carrefour failed to reform its practices. within 60 days.