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Ahold Delhaize Annual Report 2016
Risks related to the legislative and regulatory
environment and litigation (C)
Ahold Delhaize and its businesses are subject
to various federal, regional, state and local
laws and regulations in each country in
which they operate, relating to, among other
areas: zoning; land use; antitrust restrictions;
workplace safety; public health including
food and non-food safety; environmental
protection; alcoholic beverage, tobacco
and pharmaceutical sales; and information
security. Ahold Delhaize and its businesses
are also subject to a variety of laws governing
the relationship with associates, including
but not limited to minimum wage, overtime,
working conditions, healthcare, disabled
access and work permit requirements. The cost
of compliance with, or changes in, any of
these laws could impact the operations and
reduce the profitability of Ahold Delhaize or
its businesses and thus could affect Ahold
Delhaize’s financial condition or results of
operations. Ahold Delhaize and its businesses
are also subject to a variety of antitrust and
similar laws and regulations in the jurisdictions
in which they operate, which may impact
or limit Ahold Delhaize’s ability to realize
certain acquisitions, divestments, partnerships
or mergers.
From time to time, Ahold Delhaize and its
businesses are parties to legal and regulatory
proceedings in a number of countries,
including the United States, and may be
subject to investigations or inquiries, including
but not limited to investigations or inquiries by
the competition authorities related to alleged
violations of competition laws in jurisdictions
where they conduct business. Based on
the prevailing regulatory environment or
economic conditions in the markets in which
Ahold Delhaize businesses operate, litigation,
investigations or inquiries may increase in
frequency and materiality. These legal and
regulatory proceedings may include matters
involving personnel and employment issues,
personal injury, antitrust claims, franchise
claims and other contract claims and matters.
We estimate our exposure to these legal
and regulatory proceedings and establish
provisions for the estimated liabilities where it
is reasonably possible to estimate and where
the potential realization of a loss contingency
is more likely than not.
The assessment of exposures and ultimate
outcomes of legal and regulatory proceedings
involves uncertainties. Adverse outcomes
of these legal proceedings, or changes
in our assessments of proceedings, could
potentially result in material adverse
effects on our financial results. For further
information, see Note 34 to the consolidated
financial statements.
