Russian Council of Shopping Centres (RCSC) has appealed to the Federal Antimonopoly Service (FAS) to investigate and limit what it calls aggressive price dumping by online marketplaces, Kommersant reports.
“Kommersant” obtained a letter dated September 19 from Bulat Shakirov, President of the RCSC, addressed to FAS Head Maxim Shaskolsky. The letter requests an assessment of the marketplaces’ pricing practices, which the union describes as unfair competition that harms traditional retail players and shopping centers. The FAS said it will review the appeal.
Marketplaces often compel sellers to offer goods at prices 20-70% lower than those in offline retail stores, a practice that has long concerned traditional retailers. Retailers argue that such price dumping threatens the viability of physical stores and call for regulatory limits to protect offline retail. Meanwhile, marketplaces counter that restrictions would stifle e-commerce competition and drive prices up.
Stanislav Bogdanov, Chairman of the Association of Retail Trade Companies, points out that marketplace dumping has led to a decline in specialized retail chains, including bookstores, children’s goods, stationery, and hobby supplies.
The negative impact of price dumping spans multiple industries. Alexey Molodykh, CEO of International Association for the Development of Marketplaces and Entrepreneurs, notes that Russian brands struggle to plan production and pricing due to marketplaces imposing fixed price levels. Bogdanov warns that without change, many small and mid-sized offline retailers could be forced to shut down.
Marketplace players like Ozon defend discounting as a long-established market tactic, citing decades of offline promotions such as sales events and yellow price tags. A marketplace representative emphasized that sellers can opt out of discounts at any time, though only about 2% do so. Wildberries, another major marketplace, claims discounts help sellers increase sales without sacrificing profits while offering customers affordable prices.
However, sellers often become trapped by marketplace pricing policies, compelled to participate in promotions and face rising commissions and fines, explains Artur Gafarov, Director of the Institute for the Development of Entrepreneurship and Economics. This dynamic makes offline retail unprofitable, forcing sellers to rely solely on large online platforms, confirms Bogdanov.
“But this situation won’t last forever. Sooner or later, online platforms will start recouping lost profits by raising commissions and fines and inventing new ways to recover the money invested in discounts,”
Gafarov warns.
Source: "Kommersant"
