MIDA balks at proposed Closing Law regulation easing drugstore food sale rules

Written by  //  July 20, 2011  //  Retail  //  No comments

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DACO is proposing regulation to allow pharmacies to sell more food items during hours when supermarkets are legally required to remain closed. (Credit: © Mauricio Pascual)

The Marketing, Industry and Food Distribution Chamber expressed its opposition Tuesday to a proposal by Consumer Affairs Secretary Luis Rivera Marín to approve a regulation related to the Closing Law to allow pharmacies to sell more food items on the days that supermarkets must remain closed.

“This is an implied repeal of the Closing Law, but only for pharmacy chains,” said Ferdysac Marquez, president of MIDA, as the trade group is known in Spanish. “[Consumer Affairs, or DACO] intends to do through a regulation what the Legislature did not want to do. And little by little, pharmacy chains are becoming supermarkets, but with preferential treatment.”

The proposed change provides that on Sundays between 5 a.m. and 11 am, and holidays, pharmacies would be the only businesses with more than 25 employees that will be allowed to sell food, a move that particularly favors multinational chains Walgreens and CVS, MIDA claims.

“This is exactly the opposite of the legislative intent, which in 2009 included specific language to limit the items that can be sold in pharmacies,” the trade group said Tuesday.

Historically, MIDA has defended free competition, but is claiming this time that DACO’s proposal promotes unfair competition.

“”We don’t object to selling food in pharmacies chain, but we demand equal treatment,” said Manuel Reyes, executive vice president of MIDA. “It is unreasonable to claim that while supermarkets, which offer better prices and variety in food sales, are required to close, chain pharmacies selling such products are allowed to open. This does not benefit consumers.”

MIDA further argued that what DACO and the Justice Department should be probing is whether food sales at pharmacies should be considered when evaluating the food market as it relates to the Anti-Monopoly Law.

Justice continuously requests information from MIDA members regarding sales and expansion plans to ensure there is no market concentration that may harm consumers, but food sales at chain pharmacies are not considered, the trade group’s representatives said.

The impact of excessive concentration of new stores across the island must be evaluated not only for the pharmacy market, but for others that compete with their business model, the group further noted.

“This is contrary to the wellbeing of the food industry, which is one of the few that is mostly in the hands of local entrepreneurs who keep their profits on the island and we would like to know what Justice and DACO are doing about that,” Reyes said. “Consumer protection begins with ensuring fair competition, and healthy multinational chain pharmacies don’t need any more benefits.”

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