China regulator accuses Carrefour of price rigging - Xinhua

HONG KONG Thu Dec 13, 2012 5:17am EST

HONG KONG Dec 13 (Reuters) - Chinese regulators have accused French supermarket chain Carrefour, the world's No.2 retailer, of misleading customers over prices at one of its outlets in northwestern China, the official Xinhua news agency reported on Thursday.

Inspectors in the city of Taiyuan in Shanxi province found that one of its stores was engaged in "price gouging", charging customers higher prices at check-out counters than were advertised on the shelves, it said.

According to Xinhua, the results of the investigation, which began last week, have already been submitted to a trial board and penalties will be issued soon.

Officials at Carrefour's China headquarters could not be reached for comment.

Qiao Xudong, the Taiyuan store's public relations manager, told Reuters that the municipal pricing bureau was investigating the firm, but denied intentional mis-pricing and said that no official conclusion had yet been drawn.

"We are actively cooperating with the price bureau on the investigation, and will look into the matter thoroughly," he said. "But as a company which deals with thousands of products, you cannot guarantee that there won't be any mistakes at all, that would be unrealistic."

If found guilty of price violations, Carrefour could be liable to a fine no greater than five times the amount of illegally gained profit, Xinhua said.

In January last year, China fined Carrefour and U.S. rival Wal-Mart Stores Inc in a similar case over price manipulation.

Carrefour, which has over 200 stores in China, was forced to temporarily close one of its stores in March after state media reported the chain was passing off regular chicken as free-range meat.

In February, Wal-Mart named a new head of its China operation, which had been tainted by food scandals, including a pork mislabelling issue in 2011 that forced the company to temporarily shut a dozen stores in central China.

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