The Court of Justice of the European Union has ruled that Hungary’s system obliging large food retailers to apply mandatory discounts and stock requirements violated EU law, setting a clear legal limit on how far member states can go in intervening directly in retail pricing during inflationary periods.
The judgment, delivered on 18 June in Case C-658/24 (Penny Market), concerns legislation introduced by Hungary in 2023 in response to surging food inflation across Europe. The rules required major retailers to sell selected food products at reduced prices while also ensuring continuous availability of those goods on shelves.
The case was initiated after Penny Market Hungary challenged penalties imposed under the scheme. The Court concluded that the measures conflicted with EU rules governing the common organization of agricultural markets and the fundamental freedom to provide services within the internal market.
Hungary defended the policy as a consumer protection tool designed to counter rapid price increases triggered by post-pandemic disruption, the energy crisis, supply chain pressures, and the economic fallout following Russia’s invasion of Ukraine. Authorities argued the intervention was necessary to guarantee access to essential goods.
