EXCEPTIONAL PERMISSIONS GRANTED BY THE FINNISH COMPETITION AUTHORITY TO THE FIXED PRICING SYSTEM OF THE ANDIAMO, K-KENKÄ, INTERSPORT AND MUSTA PÖRSSI CHAINS

The Finnish Competition Authority has granted to Keswell Ltd exceptional permissions by which it is allowed, on certain conditions, to fix the highest retail prices for part of the products sold by the Andiamo, K-kenkä, Intersport and Musta Pörssi chains. Keswell Ltd is Kesko Corporation’s wholly-owned subsidiary. Earlier this year, the Finnish Competition Authority has granted exceptional permissions to Kesko Food Ltd’s chains.

The exceptional permissions received by Keswell include the following conditions:

1. The highest retail prices can be fixed for products included in the chain selections of the above chains, and those products cannot account for more than 35% of the average annual sales of each chain’s stores in each size class.
2. Retailers can always use prices that are lower than the highest retail prices fixed by Keswell, and they can advertise products independently.
3. The highest retail prices can be valid in all the above mentioned chains for a maximum two (2) months at a time. In addition, the prices of the Musta Pörssi chain’s strategic products can be valid for a maximum of six (6) months at a time.
4. The size classes of stores shall be determined in the way that all stores have an opportunity to purchase at least 20% - of total sales - of products not included in the chain selection.
5. The stores operating in the chains can also purchase, without restrictions placed by Keswell, products included in the fixed pricing system from other suppliers than Keswell or suppliers determined by Keswell.

According to the fourth item, the chain selection can account for 80 percent of the sales of the chains’ stores. The exceptional permissions are valid from 1 January 2001 to 31 December 2005.

According to Kesko, the exceptional permissions granted by the Finnish Competition Authority give Kesko and the K-stores good opportunities to carry out operations in line with the new chain strategy. Applications for exceptional permissions concerning the K-rauta, Rautia and K-maatalous chains are under consideration in the Finnish Competition Authority.

For further information, please contact Keswell Ltd’s Project Director Minna Kurunsaari, telephone +358 1053 39105, or Keswell Ltd’s President Matti Laamanen, telephone +358 1053 39100.

KESKO CORPORATION
Corporate Communications

Atte Kaksonen
Manager

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