STATEMENT BY BENEFIT SYSTEMS S.A. ON THE DECISION OF THE OFFICE OF COMPETITION AND CONSUMER PROTECTION
Benefit Systems will appeal against the decision of the Office of Competition and Consumer Protection imposing a fine on the company for its activities carried out between 2012 and 2017. The questioned activities were executed within the capital group that was being established at that time. Therefore, in the company's opinion, in the light of Polish and EU competition law they should not be subject to antitrust proceedings and penalties.
The date of the decision is also unfortunate. After five years of dealing with the case, the Office of Competition and Consumer Protection ends the proceedings and issues its decision at a time when the company and thousands of its partners from the fitness industry are struggling with the greatest crisis in their history. Due to the restrictions and prohibitions associated with the pandemic, Benefit Systems is currently generating only a small fraction of its previous revenues, while incurring huge costs of maintaining the sports infrastructure and employment at the same time.
The entities whose activities in the years 2012-2017 were examined by the Office of Competition and Consumer Protection were related to us by capital, economic or personal relationship to the extent that entitles us to participate in the decisions they made. Our involvement in their activities was an element of creating a capital group, as evidenced by the fact that most of the entities subject to the Office of Competition and Consumer Protection's proceedings are now an integral part or property of Benefit Systems.
The mission of Benefit Systems and the essence of our business activity is to encourage Poles to take up physical activity, for example by using fitness clubs and other sports facilities. The existence of an extensive and diverse sports infrastructure is critical to our functioning. Thus, the adoption of the perspective contained in the justification of the Office of Competition and Consumer Protection's decision and the assumption that Benefit Systems aimed at territorial division of the market to limit the offer of fitness clubs would lead to the conclusion that we acted to our own detriment. This is of course not true. On the contrary. For many years now we have been involved in the development of sports infrastructure in Poland, investing, among others, in companies running fitness clubs to meet the growing demand for physical activity among employers and employees.
What is more, it is the activity of Benefit Systems and our cooperation with sports facilities within the partnership network that enabled many of them to further develop or survive on the demanding market. Our financial support for companies outside our capital group that run sports facilities has enabled, among others, construction of 35 new facilities and modernisation of 209 more, providing Poles with access to over 37,000 m2 of new space for exercises.
It is also worth noting that the activities subject to the proceedings had a positive impact on the consumer's situation – Benefit Systems’ investments contributed to the increase in the availability of sports facilities and improvement of the quality of fitness services on the Polish market. It was noticed by the Office of Competition and Consumer Protection during the proceedings and in a detailed market analysis. Sports cards have become an impulse that activates Poles physically and an extremely important, additional source of income for companies operating on the fitness market to which hundreds of millions of zlotys are transferred every year, also as part of MultiSport cards. Additionally, in the period analysed by the Office of Competition and Consumer Protection, nearly 60% of our card users were people who had never trained in sports facilities before. It had and still has a direct impact on the health and condition of the society. It also generates savings both for the state and employers, which are counted in hundreds of millions of zlotys annually. Physical activity is one of the key elements in the prevention of diseases of affluence. It also leads to the reduction of sickness absenteeism and increases the efficiency of employees.
Considering the above, the date of the Office of Competition and Consumer Protection's decision is highly unfortunate. For almost a year now, Benefit Systems and all entities which the company cooperates with are struggling with the greatest crisis in their history. The sports and recreation industry is one of the most affected by the pandemic and at the same time – due to its specific nature – the least benefiting from government support programmes. Due to the restrictions and prohibitions associated with the pandemic, Benefit Systems is currently generating only a small fraction of its previous revenues, while incurring huge costs of maintaining the sports infrastructure and employment at the same time.
Despite this, we would like to assure that in line with our mission and the adopted strategy we will continue to work towards the physical activation of Poles, promoting a healthy lifestyle and the development of the sports and recreation industry in Poland.
