UPDATE: Erli marketplace files lawsuit against Allegro e-comm for dominant position abuse

#adds Allegro's response to allegations#

"We do not consent to artificial price inflation and actions that harm consumers, thousands of Polish e-shop owners, and the credibility of the entire e-commerce industry. Someone has to call out unfair practices that aim to create a monopoly," said Adam Ciesielczyk, founder and CEO of Erli, quoted in a press release.

According to Erli, the key element of the dispute is Allegro's forcing sellers using the platform to follow a specific pricing policy across the entire Internet.

Allegro makes the promotion of a given seller's products outside and inside the platform dependent on the prices that the seller has outside Allegro, Erli said in the press release.

In Erli's view, Allegro's actions are examples of unfair competition consisting in abuse of a dominant position, because " they directly and effectively affect sellers, impose pricing methods on them, and ultimately result in higher prices for consumers."

Allegro's imposition of pricing rules outside its own platform prevents sellers from pursuing lower-price strategies in lower-cost channels, Erli assessed.

"This is not the first time that Allegro has tried to intimidate other market players by threatening them with negative consequences if they do not comply with the expectations of the dominant player," CEO Ciesielczyk said.

"In the case of Erli, these practices have historically taken the form of, for example, unfounded lawsuits for data copying (as if Allegro had 'forgotten' that the content of the offer belongs to the seller), but also direct attacks on sellers offering their products on Erli – e.g. by Allegro hindering their access to their own offers via API if the sellers wanted to offer products on Erla at the same time," he added.

Erli is a Polish shopping platform with over 35,000 registered Polish sellers offering over 40 million products.

Allegro refutes Erli's allegations.

"We strongly disagree with Erli's position. We do not impose any specific pricing policy on our partners. Each of our partners is free to set prices in any sales channel," said Marcin Gruszka, head of communications at Allegro Group, in a comment sent to PAP Biznes.

"The pricing policy of partners outside the Allegro platform has no impact on the position of their offers on the Allegro platform, including their promotion on our website," he added.

As Gruszka explained, Erli's lawsuit concerns two things: the Allegro Ceny (Allegro Prices) programme and the advertising of Allegro offers outside this website, e.g. on Google.

"We, as Allegro, finance these benefits. Allegro Ceny is a programme for sellers in which Allegro subsidises product price reductions to make the offer more attractive to customers. We do not want to subsidise the offers and advertising of those partners whose prices are clearly uncompetitive compared to the market," said Gruszka.

Allegro is currently involved in a broader legal dispute with Erli, he pointed out. According to Allegro, Erli has been unlawfully using the API, e.g. to copy offers and content from the Allegro product catalogue.

"We understand Erli's current actions as retaliatory. We disagree with Erli's unfounded and one-sided narrative. It presents the situation as if Allegro were limiting price competition, when in fact Erli's lawsuit concerns only a small part of our cooperation with partners," Allegro's head of communication department told PAP Biznes.

"I don't think anyone can blame Allegro for wanting to subsidise those partners who offer competitive prices. This is our investment, which partners can take advantage of if they want to, but it is, of course, voluntary (...)," he added.

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