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Ahold Delhaize is suffering significant damage as a result of state intervention by the Serbian government, which is restricting margins, among other things. The retailer, which has been forced to close stores and cut jobs, is turning to the World Bank.
“Significant losses”
Since the end of August , the Serbian government has limited profit margins on 3,000 products to 20%. In addition, suppliers have been given the right to veto the removal of products and the reduction of orders. Officially, the measure is intended to protect consumers from price increases, but the rule mainly affects foreign chains, which are now barely able to make a profit.
“Our company achieved a net profit margin of 4.4% in 2024, and only 4 months of the Regulation in 2025 led to significant losses. To continue operating, the company, up until now, had to take the difficult decision to close 25 stores and suspend investments planned for 2026, leading to the loss of hundreds of Serbian jobs,” Ahold Delhaize said in a press release on Friday.
No resolution achieved
The retailer is therefore now turning to the International Centre for Settlement of Investment Disputes (ICSID), a division of the World Bank. “We have not taken this arbitration step lightly,” the company said. “This step follows months of intensive efforts to engage in constructive dialogue with the Serbian authorities to identify balanced solutions that serve the interests of consumers, the economy, and Serbia’s long-term investment climate. Despite these efforts, a resolution has not been achieved.”
Through the arbitration proceedings, Ahold Delhaize aims to ensure that international treaty obligations are complied with and that a predictable, transparent, and fair investment climate is maintained. Delhaize Serbia, Ahold Delhaize’s local brand, has been active in the country for 25 years and has built up a network of 547 stores and employs more than 11,000 people. This makes it one of Serbia’s largest private employers. According to the company, it has invested €536 million in Serbia over the past ten years.
