Russia: Limits on fees paid to food retailers

Russia: Limits on fees paid to food retailers

Federal Law # 273-FZ (2016) amends existing trade law with respect to the maximum amount of fees that can be charged by retailers of food products and supplies.

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In general, the new measures reduce to 5% (down from 10%) of the maximum receivable that a retailer under a supply contract for food products may receive. The 5% limit applies to the cost of the purchased goods, net of value added tax (VAT) and excise duties charged by the supplier. 

The types of remuneration subject to the 5% limit is "open." The fee is no longer limited by volume bonuses and allows for consideration of the most common types of fees paid to a retailer, in particular:

  • Fees (e.g., premiums, bonuses) for purchasing the agreed volume of goods 
  • Service fees for the promotion of goods (the new law lso introduces the definition of such services) 
  • Service fees for pre-sale preparation, processing, and packaging of goods 
  • Fees for logistics and “other similar” services

 

Read a 2016 report prepared by the KPMG member firm in Russia: Cutting retailers’ fees under food products supplies – any alternatives?

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