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Unilever (LON:) and Procter & Gamble (NYSE:), prominent players in the consumer goods sector, have been fined €1 million each by the Greek Ministry of Development for violating gross margin cap laws on over 100 product codes. The fines come as part of an ongoing effort led by Minister Kostas Skrekas to combat inflation, with investigations into five other multinational corporations, including those in the food industry, nearing conclusion.
Unilever has contested the fine, taking issue with its calculation method. The company sees the decision as provisional and has plans to appeal to the Council of State. The firm’s multi-page objection was dismissed within three hours of their five-day response time, a period notably shorter than the 30 days allotted to another multinational. Unilever argues that a majority of additional production costs have not been passed onto consumers, negatively impacting its profitability.
Elias Unilever Hellas, Unilever’s Greek subsidiary employing 450 workers and operating a factory in Attica along with two distribution centers, has committed to the Ministry’s “Permanent Price Reduction” initiative. The company pledged not to transfer significant additional costs to its profitability amidst rising living costs.
The recent developments have caused some companies operating in Greece to issue divestment warnings due to dissatisfaction with the government’s actions. Internationally, Unilever has faced criticism from Ukraine’s NACP for its operations in Russia following the invasion of Ukraine in February 2022. The company was labeled an “international sponsor of war”.
Despite these controversies, Unilever reported a third-quarter sales growth of 5.2% with a turnover of €15.2 billion and a metric growth to €45.8 billion over nine months, marking a 7.7% increase.
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This story originally appeared on Investing
