Polish watchdog accuses online marketplace Allegro of unfair practices

[December 10, 2019]   WARSAW (Reuters) - Polish online marketplace Allegro abused its dominant position by using its technical know-how to favor its own shop over other sellers, competition watchdog UOKiK said on Tuesday, threatening the company with a fine of up to 10% of revenue.

Allegro, a Polish equivalent of eBay which allows both professional retailers and members of the public to sell on its platform, used an algorithm not available to other sellers to favorably position offers from its own shop, UOKiK said.

"In our opinion, Allegro used information it had gathered, including an algorithm for deciding on the relevance of items, to favor its own shop," UOKiK president Marek Niechcial told reporters.

"The company knew how to position products so buyers chose them more often than those from competitors' shops."

UOKiK also said that some sales or promotion functions were only available for the official Allegro shop.

Allegro said it would fully cooperate with UOKiK.

"We take compliance very seriously, especially since we fully support UOKiK's objectives in protecting consumer rights and protecting fair competition," it said in a statement.

"We are a Polish company, proudly supporting the development of the digital economy and we are convinced that the current proceedings will confirm the high standards that we follow in this regard."

Bought by private equity funds Cinven, Permira and Mid Europa for $3.25 billion in 2016, Allegro is by far the most popular e-commerce platform in Poland, with 79% of Polish consumers using the site according to a Kantar study carried out for UOKiK.

(Reporting by Alicja Ptak, writing by Alan Charlish, editing by Nick Macfie)

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