Bloomberg News

X5 Says Anti-Monopoly Proposal Would Hurt Expansion

July 16, 2009

X5 Retail Group NV (FIVE), Russia’s largest food retailer, said a proposal by the Federal Anti-Monopoly Service would prevent supermarket operators from expanding.

The proposal, slipped into a draft law on trade, would ban companies with an annual revenue of more than 1 billion rubles ($31 million) and a market share of more than 25 percent in a city, including Moscow and St. Petersburg, from adding more retail space or opening new stores, X5 said in an e-mailed statement today.

“This limitation can put a halt on development of the retail trade, because one million rubles in annual revenue is a standard indicator for a chain of five to six stores,” X5’s Chief Executive Officer Lev Khasis said in the statement. “I hope the government will revise this point and make it comply with common sense.”

The draft law was passed by the government this week and submitted to parliament for approval, according to X5. The legislators may debate the bill through November, with it becoming law at the start of 2010, Mikhail Terentiev, an analyst at Nomura Holdings Inc., wrote in a note to investors today.

To contact the reporter on this story: Maria Ermakova in Moscow at mermakova@bloomberg.net

To contact the editor responsible for this story: Mark Sweetman at msweetman@bloomberg.net


Toyota's Hydrogen Man
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus