Ministry of Commerce and Industry issues decision capping services fees charged for the display and marketing of locally produced or packaged food and consumer goods

  • 2 months   ago

•      The decision aims to promote national products and facilitate their delivery to consumers.

•      Bolstering demand for national products among citizens and residents.

•      Setting payment deadlines to settle local suppliers’ obligations towards retail outlets.

•      Barring any practice that enables retail outlets to impose service fees, payment deadlines or discriminatory terms and restrictions, or to refuse to deal with local suppliers.

•      Setting a ratio for local products as a percentage of all displayed products of the same type.

The Ministry of Commerce and Industry announced decision No. (6) of 2020 by the Committee that Sets Maximum Prices and Profit Ratios, on capping the services fees charged for displaying and marketing locally produced or packaged food and consumer goods.

The decision was issued within the framework of the Ministry’s efforts to bolster the national industrial environment, consolidate the achievements of local industries and to support national products and showcase their quality.

The decision also falls in line with the Ministry’s long-time interest in monitoring national economic developments and transactions in local markets as well as its ongoing efforts to bolster the business environment in a bid to support local dealers, promote national companies and foster their role in contributing to the growth and economic development in line with the Qatar National Vision 2030.

The decision and its provisions define outlets as stores, markets and sites that display and market locally produced or packaged food and consumer goods. The decision defines a local supplier as a company, commercial establishment or individual who produces or packages food and consumer goods.

The decision also defines service fees as the percentage, commission or payments that retail outlets secure in exchange for displaying and providing marketing services for locally produced or packaged food and consumer goods. The decision outlined the obligations of retail outlets when displaying and marketing locally produced or packaged food and consumer goods as follows:

 

– Not to exceed the maximum fee for displaying and marketing locally produced or packaged food and consumer goods.

– Committing to honoring payment deadlines for local suppliers.

– Refraining from practices aimed at imposing service fees, payment deadlines and discriminatory conditions on local suppliers.

– Complying with the ratio of displayed local products out of the total percentage of displayed goods of the same type.

 

The Ministry outlined the maximum service fees to be imposed by retail outlets for the display and marketing of locally produced or packaged food and consumer goods at 10 percent of their sale value.

The aforementioned services include, but are not limited to, the following services:

  •  
  • Fixed discount Percentage
  • Progressive profit margin
  • New company registration fees
  • New product registration fees
  • Shelf usage fees
  • Gondola shelving fees
  • Loyalty program
  • Service organization activities (assortment management)
  • Presentation and promotion
  • Seasonal promotional services
  • Offers or promotions
  • Opening of new branches
  • Payment method
  • Exceptional payment methods
  • Product display fees
  • Expired products penalty fine

Retail outlets shall also maintain the current service fees for displaying and marketing goods to which this resolution applies if those fees are less than the minimum stipulated in this regard.

As for the payment deadlines to settle dues between retail outlets and local suppliers, the decision stipulates the following:

1- 15 days for locally produced or packaged perishable food products. The list of products includes but is not limited to:

  • Vegetables and fruits
  • Fresh and chilled fish and seafood
  • Chilled meats and their products
  • Chilled poultry
  • Table eggs
  • Milk and dairy products
  • Bread of all kinds (grain / slices).

2- 40 days for other locally produced or packaged food products

3- 60 days for other (non-food) consumer goods or locally produced or packaged goods

The aforementioned deadlines are calculated from the date of submitting the monthly account statement to retails outlets and within a period not exceeding 30 days from the date of issuing the invoice.

With regard to their third obligation, retail outlets are prohibited from pressuring dealers to secure service fees, and from imposing payment terms or other discriminatory conditions and restrictions in violation of the provisions of the decision. Retail outlets are also prohibited from refusing to deal with local suppliers.

Touching on the fourth obligation relating to the display and marketing of goods to which the provisions of this decision apply, display and marketing operations have been subjected to controls and procedures, such as setting the percentage of displayed local products at fifty percent (50%) at least of the same type of all displayed goods. These goods shall be displayed on middle shelves and priority shall be awarded to the display of national products by placing a “national product” label on shelves.

The Ministry said it would intensify its awareness campaign to promote national products while carrying out inspection campaigns to ensure the compliance of retail outlets with decision No 6 of 2020 by the Committee that Sets Maximum Prices and Profit Ratios, to ensure the compliance of concerned parties with their stipulated obligations and to crack down on any violations in this regard.

 

Source: Ministry of Commerce and Industry

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