Ceiling on retail profits for “Recycle – Swap appliance” program

An legislative amendment was submitted to parliament for the imposition of a cap on air conditioner, freezer, and refrigerator prices, as an attempt to control possible profiteering phenomena for the period during which the “Recycle – Swap Appliance” program will be in effect.

This is essentially the extension of the scope of the provision that already applies to a number of products and services (such as fuel and basic commodities) and for which a ceiling is provided for the gross profit margin in order to limit the phenomena of unfair profiteering.

The Minister of Development and Investments, Adonis Georgiadis, noted that with the announcement of the program for the replacement of old appliances, a very large increase in the price of air conditioners was observed in many stores, calling the phenomenon “unacceptable”.

Specifically, for the time period from the beginning to the end of the “Swap Appliance” program, it is prohibited to make a gross profit if the gross profit margin per unit exceeds the corresponding gross profit margin per unit before 31.12.2021. Violators will be fined between 5,000 and 1,000,000 euros.

910,000 applications

Over 910,000 applications for inclusion in the “Recycle – Swap Appliance” program have been submitted to the.

The subsidy is of the order of 30% – 50% (135 – 710 euros), for air conditioners, refrigerators, freezers and the purchase of a new appliance must be made by 16 September and the withdrawal of an old appliance by 30 September.

Market freeze

The first four months of this year the Greek electrical and electronic goods market moved downwards (6.27% decrease in value, -13.12% in volume), as consumers were awaiting the subsidy coupon. In fact, in May, June and until today, the market showed a further slowdown.

With reference to the price increases in retail since March – April, these amount to approximately 25% in air conditioners, with the price now including free installation with an average cost of 100 euros, but also a gift voucher for recycling which, depending on the model and the cost of each appliance ranges from 50 to 100 euros.

For refrigerators and freezers, for products of the newest and technologically advanced, class “E”, the average increase is of the order of 5%-7%.

The increase in production costs in factories, especially in Asia, the increase in freight rates (a container from China with an average price of 2,500 euros last year, today costs about 14,000 euros) and the fluctuation of the dollar-euro exchange rate were the reasons for the revaluations according to market sources. With competition already strong among wholesalers as well as retailers, no further price increases are foreseen, the sources said.

Public shaming of profiteers extended to the end of 2022

At the same time, the measure for making public the name of firms engaged in unlawful profiteering is extended to December 31, 2022.

It is recalled that the names of the companies are made public if they are fined more than 50,000 euros, as well as in cases where a fine is imposed for the second time, regardless of the amount.