Food and Beverage Business
Finance

Unilever Incurs $1 Million Fine in Greece for “Unjustifiable Profiteering”

Unilever Incurs $1 Million Fine in Greece for "Unjustifiable Profiteering" Unilever Food and Beverage Business

The Greek government’s Ministry of Development has imposed a €1m ($1.1m) fine on Unilever for unfairly profiteering. This penalty is in violation of article 54 of a law that aims to reduce phenomena of unfair profit.

Kostas Skrekas, Greece’s Minister of Development, emphasized that no one is above the law and stated, “We are determined to enforce the law to prevent profiteering and stimulate healthy competition for the benefit of the Greek family. Checks will continue, and fines will be issued without hesitation.”

Unilever, a London-listed FMCG giant, issued a statement in response to the fine, expressing disagreement with the methodology used to calculate the penalty. The company plans to contest the fine through prescribed procedures.

Unilever’s Greek subsidiary, Elias Unilever Hellas, stated that it recognizes the pressure on consumers’ purchasing power and consciously decided not to burden its profitability by transferring a large percentage of additional production and operating costs to consumers and retailers. The company’s decision aligns with its commitment to protect consumers and support retailers.

In response to the fine, Unilever’s statement mentioned the company’s significant presence in Greece, including 450 employees, a factory in Attica, and two privately owned distribution centers.

Greece’s Ministry of Development also fined Procter and Gamble, another FMCG giant, for profiteering.

Unilever’s Greek business will participate in the “Permanent Price Reduction” initiative launched by the Ministry of Development, offering reduced prices on more than 80 known product codes from all categories.

Greece’s headline inflation averaged 9.3% in 2022 but declined to 6.3% in the first quarter of 2023. Price pressures are expected to further moderate this year due to easing energy prices, with consumer prices forecasted to increase by 4.2% and 2.4% in 2023 and 2024, respectively.

Unilever’s latest results showed a 5.2% rise in third-quarter underlying sales growth, resulting in a turnover of €15.2bn. Over the nine-month period, the metric grew 7.7% to €45.8bn.

In addition to the fine, Unilever has faced criticism for its continued presence in Russia, which invaded Ukraine in February 2022. The company was added to Ukraine’s National Agency for the Prevention of Corruption’s list of “international sponsors of war.”

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