Act 27,545, called Supermarkets Gondolas Act (published in the Official Gazette on March 2020), states in its section 1st, that its purposes are the following:
a) Contribute to a transparent and competitive price of food, beverages, and household cleaning products, for the benefit of consumers;
b) Keep harmony and balance between the economic operators reached by the Act, in order to avoid that they carry out commercial practices damaging or implying a risk for competition or cause distortions in the market;
c) Expand the offer of craft and/or regional national products manufactured by Micro, Small and Medium Enterprises (MIPYMES) and protect their performance; and
d) Encourage through a special regime, the offer of products of the family, peasant and indigenous agriculture sector, defined by section 5th of Act 27,118, and of popular economy, defined by section 2nd of the Annex to decree 159 dated March 9, 2017, and the products generated in cooperatives and/or mutual charter associations under the terms of Acts 20,337 and 20,321.
In order to meet the goals declared in its section 1st, the Gondolas Act provides for in its section 7th – among other measures -, a set of rules for the display of products that must be complied with in the gondolas of the establishments of the “subjects reached by the Act”, according to section 3rd of said Act.[1]
Hence, subsection a) of section 7th sets forth that “In gondolas and virtual locations the exhibition of products of a supplier or business group cannot exceed thirty percent (30%) of the available space that it shares with products of similar features. The participation shall involve not less than five (5) suppliers or business groups”.
In turn, subsection b) provides that: “Twenty-five percent (25%) of the space available for products of similar features and different trademark must be guaranteed in gondolas and virtual locations, for the exhibition of products manufactured by micro and small national enterprises registered with
the Registry of Micro, Small and Medium Enterprises (MIPYMES) and/or in the National Registry of Family Agriculture (RENAF), or those replacing them in the future and/or manufactured by cooperatives and/or mutual charter associations under the terms of Act 20,337 and Act 20,321; and an additional five percent (5%) for products originated by family, peasant and indigenous agriculture defined by section 5th of Act 27,118, and popular economy sectors, defined by section 2nd of the annex to decree 159/2017;”.[2]
Finally, section 7, in its subsection d), sets forth that: “In the display stands and display shelves next to the checkout lines fifty percent (50%) of the space shall display products manufactured by micro and small national enterprises registered with the Registry of Micro, Small and Medium Enterprises (MIPYMES) and/or in the National Registry of Family Agriculture (RENAF), or those replacing them in the future and/or manufactured by cooperatives and/or mutual charter associations under the terms of Act 20,337 and Act 20,321, or those replacing them in the future;”.
The Resolution of the Secretariat of Domestic Trade – which is the Enforcement Authority of Act 27,545[3] – N° 190/2021, issued on 2/24/2021, determines, in its section 3rd, that the “subjects reached” by the Act shall decide the grouped display of the “products reached by the Act”[4],
so that they may be visualized by its continuous and close place in the gondolas, avoiding dispersion of products of the same category in the showroom.
The measurement instruments to be used in the inspections related to the compliance with the display rules imposed by the Supermarket Gondolas Act, the purpose of said inspections and their proceedings were set forth in Annex II, “Inspection Rules”, of said Resolution 190/2021.
Resolution of the Secretariat of Domestic Trade 1055/2021, issued on November 19, 2021, sets forth – as stated in its Whereas Clauses – supplementary provisions of said Inspection Rules, with the stated purpose “… to make transparent and clarify the provisions of subsection a) of section 7th of Act N° 27,545, of Supermarket Gondolas, to determine the percentage of display space of the same supplier or business group …”, on the total surface of display in supermarket gondolas, in the on-site sales showrooms, with respect to each category of the ”products reached by the Act”.
For such purpose it determines, in the first place, how should the display space in supermarket gondolas be calculated, for the same supplier or economic group (Resolution 1055, section 1st).
It provides on the issue that in order to make the calculation the spaces occupied by the group of products of the same supplier or economic group should be added within the same category, defined as such in Annex II of the Resolution of the Secretariat of Domestic Trade N° 110, dated January 27, 2021[5], in the supermarket gondolas existing in the inspected on-site sales establishment.
Next, Resolution 1055 sets forth that the surface resulting from the following multiplication shall be borne in mind:
(i) the base of the shelf or display device occupying an homogeneous group of products of the same supplier or economic group, within the same category, by
(ii) the total height or said shelf/ves, regardless of the height of the displayed products – obviously – lower than that of the shelves in which they are displayed.
And it makes clear that, in case that in the last shelf or display device there is no shelf or structure in the upper part, then the height resulting from the highest product or group of products should be borne in mind.
The display surface thus obtained, shall be then compared – obviously – with the total display surface in the gondola of the category of products in question, to set the percentage occupied by the products of the same supplier or economic group within the category.
Section 2nd of Resolution 1055 provides for in its first paragraph that “The display surface of the same supplier or economic group to be computed, must embody a grouped set of products easily identifiable and available for their acquisition by consumers.”
And it clarifies, in its second paragraph that the spaces occupied by dispersed products, that are not displayed in groups or which occasionally occupy display spaces of other trademark or supplier and where it may be presumed that their isolated location is the result of the consumers’ handling should not be added.
The regulation of section 3rd, in turn, sets forth that empty or half-empty spaces in gondola, existing on the clear, visible and horizontal indication of a certain trademark or supplier in the gondola shall be computed as display spaces belonging to said supplier or economic group.
Finally, section 4th of Resolution 1055, provides that the display surface in gondolas of the products subject to specific price and supply conditions for their sale under the so-called “Price-watch” (Precios Cuidados) Program – which must maintain the display conditions agreed upon with the Enforcement Authority[6] -, “… shall not be computed for the purpose of counting the display space used for the products of the main supplier, pursuant to subsection a) of Section 7th of Act N° 27,545 of Gondolas.”
Even when some of the clarifications contained in Resolution 1055/2021 may be considered obvious, I believe that they are, if anything, useful to minimize the probabilities of sterile discussions that would cause the waste of court action and consumers’ time and money.
In a provision which I deem superabundant, the regulation of the first paragraph of section 5th of Resolution 1055/2021 sets forth that: “During the inspection procedure the person in charge of the on-site sales showrooms must lead and allow the inspectors’ access to all the spaces of gondolas where the products that make-up the inspected categories are displayed.”
In its second paragraph said section 5th provides that: “To such end, inspectors shall list to the person in charge of the on-site sales showrooms the categories subject matter of inspection and the products that compose it, in accordance with Resolution N° 110/21 issued by the SECRETARIAT OF DOMESTIC TRADE, and this will be acknowledged in the respective Certificate.”
Section 5th ends with an obligation for inspectors, which if well-fulfilled, I understand it will help minimize questionings.
Because it obligates inspectors to photographically record all the display spaces in gondola that contain the products of the main supplier of the category and which measures have been reviewed, to verify the percentage that they occupy in the gondola, which even if the regulation does not mention it, should be likewise photographed in whole, to ease calculation. “Said records will make-up the Inspection Certificate and shall specify date and time in which they were obtained.”
[1] Notwithstanding the provision of section 3rd of Act 27,545, the definition of “subjects reached by the Act” who must comply with its provisions was – let’s say – regulated by the Resolution issued by the Secretariat of Domestic Trade (Secretaría de Comercio Interior) 110/2021 (published in the Official Gazette on 1/28/21). According to said Resolution, the “subjects reached by the Act” are on-site sales showrooms with a commercialization surface area equal or exceeding eight hundred (800 m2) square meters. The regulation provides that the on-site sales space of the products, included from the checkout line for the display in gondolas, display stands, display shelves next to the checkout lines and exclusive freezers, as well as the space for the circulation and access of consumers shall be considered the commercialization surface area. The spaces for the exclusive use of the establishment’s personnel, warehouses of goods, gondolas and display stands that contain products not included in Section 3rd of Resolution 110 and every space forbidden to the access of consumers are exempted from the commercialization surface area.
[2] The regulation on display set forth by subsection c) of section 7th is not referred to the display spaces of the same supplier or business group, but to the display of lower price products (Said subsection reads as follows on the issue: “c) In supermarket gondolas the lower price products according to the unit of measure shall be placed at an equidistant height between the first and the last shelf. In virtual locations, it should be guaranteed that the lower price products according to the unit of measure be published in the first visualization of products of the category in question”). See on the matter my article “Supermarket Gondolas Act. Display of lower price products”, published in Abogados.com.ar on May 13, 2021.
[3] As set forth by section 2nd of the Annex to the Decree 991/2020, that regulates the Gondolas Act, which literally reads as follows: “The SECRETARIAT OF DOMESTIC TRADE of the MINISTRY OF PRODUCTIVE DEVELOPMENT, Enforcement Authority of Act Nº 27,545, is appointed and empowered to issue the supplementary and clarifying regulations necessary for their best implementation.”
[4] Pursuant to the categories set forth in Annexes I and II of the Resolution of the Secretariat of Domestic Trade 110/2021, the products reached by the Act are the following:
ANNEX I TYPE OF PRODUCTS (I) DAIRY PRODUCTS AND REFRIGERATED FOOD (except meats, other meat products, fishes and seafood) (II) FROZEN FOOD, (III) FRUITS AND VEGETABLES, (IV) GROCERY ITEMS (except own manufactured products without trade name) (V) NON-ALCOHOLIC BEVERAGES, (VI) ALCOHOLIC BEVERAGES, (VII) PERFUMERY, (VIII) CLEANING PRODUCTS, and (IX) PET FOOD AND ACCESSORIES.
ANNEX II Definition of categories. Milks. Creams, butters and margarines. Cheese spreads and ricottas. Dairy desserts and yogurts. Fresh doughs and yeasts. Cold cuts, sausages and pickles. Cheeses except for cheese spreads and ricottas. Hamburgers, breaded-beef steaks (milanesas) and meat, chicken, pork and/or fish frozen bites. Frozen vegetables, frozen vegetarian “milanesas” and veggie medallions. Ready meals and frozen pastries. Frozen ice creams and desserts. Fruits and vegetables. Sauces and dressings. Spices and seasonings. Powder for desserts and bakery, and pastries. Preserved foods and tomato sauces. Other preserved foods. Dry pasta. Rice. Soups, broths and purée. Dried vegetables, other flours, grains and seeds. Oils. Grated breads and batters. Wheat flours and premixes. Sweets, “alfajores” and chocolates. Bakery and cereals. Cookies. Infusions. Marmalades, jams and honey. “Dulce de leche”. Sweeteners. Snacks. Juices. Flavored waters. Soft drinks. Waters. Refrigerated non-alcoholic beverages. Beers and appetizers. Wines and sparkling wines. Spirits, distillates and liquors. Refrigerated alcoholic beverages. Shaving and waxing. Colognes and body deodorants, foot powders and talcum powders. Toilet soaps, Shower gels and bath salts, toiletries. Bleaching creams and hair dye. Shampoos, Hair conditioners, sprays and products for hair treatment. Facial care products and pharmacy articles. Body creams. Sunscreens and suntan lotions. Oral care. Baby care products, baby accessories and baby food. Diapers and disposable underwear. Menstrual hygiene management products, incontinence and maternal care pads. Cleaning accessories. Kitchen accessories. Soaps in bar, pre-wash, spot removers and perfumes for clothes. Laundry powders, liquid soaps and fabric softener. Air fresheners and disinfectants. Bleach. Dishwashing detergents. Floor and furniture cleaners. Creamy cleansers, of kitchen, bathroom and all-purpose cleaners. Insecticides and repellents. Papers. Pet Food and accessories.
[5] For example, “Preserved food and tomato sauces.”
[6] As set forth in section 4th of the Resolution issued by the Secretariat of Domestic Trade N° 110/2021.