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Hogan’s suggested regulation on unfair commercial practices falls short

13 April 2018

ECVC regrets that the content of the regulation falls short of the real needs of farmers and stockbreeders. We need more bargaining power to secure fair prices. We are entering a period of work and reflection in which we will demand substantial improvements from the European Parliament and Council.

13th April 2018 – ECVC believes that Commissioner Hogan’s proposal regarding the regulation of unfair commercial practices in the agrifood chain falls short of the needs of European farmers. This is because it does not address their main problems: prices imposed within a hierarchy dominated by the oligopoly, and the fact that their work is no longer cost-effective. It was the time to act, but the outcome was far from what we had hoped. Now, we are entering a period of work and reflection during which the Parliament as well as the Council must significantly improve the proposal for the sake of protecting the interests of farmers, who are the weakest part of the agrifood chain.

 

The European Commission has proposed a directive rather than a regulation, which would be directly applicable. The prerogative is, therefore, left at the hands of Member States to set different rules, on a common basis, but at the risk of jeopardising the unity of the European market, since these regulations can differ from each other and create a wide variety of problems for intra-European trade (e.g. some countries have ridiculous sanctions, while others have reasonable fines; some countries do not know how to apply regulations, others have authorities who correctly exercise their powers…). For ECVC, this conforms to the EU’s current trend of renationalizing its policies, which -as could be the case in the future PAC- doesn’t put forth any firm demands in terms of regulation and common implementation. Instead, this situation entrusts the dismantling of current regulation to the whim of Member States, in contradiction with the founding principle of the EU and the single market.

 

The proposal for the directive focuses solely on the regulation of specific abusive practices and ignores some of the most important ones, such as selling at a loss, delaying payments for non-perishable goods and not including a final clause that could provide a response to future abusive practices. However, the regulation also ignores the need to establish the obligatory drafting of contracts in the European market. These contracts must address prices and always bear in mind the production costs that farmers have to bear, amongst other issues.

 

As the Commission stated today, it is up to Member States to designate a public authority to monitor prohibited practices in each Member State. However, no single European enforcement and control authority has been established. This is one of the main weaknesses of the proposal.

 

Finally, ECVC would like to note that we should analyse how well the agrifood chain works from a global point of view, taking into account the liberalisation of agricultural markets, the loss of market regulation and support for farmers in the agrifood chain. Eliminating market regulation policies in the agricultural and food sectors and transferring them to the international stage destroys the sustainable socio-agricultural model, which is based on the produce of thousands of peasant farmers. Combating malpractice is not enough to ensure a sustainable future. Within this general framework, it is also of the utmost importance to strike a balance between competition rules, the way in which the relevant authorities implement them and the regulation of the agricultural and food sector.

 

Contacts

  • Antonio Onorati (ECVC Coordinating Committee): +39 3408 2194 56 – IT, ES, FR, EN
  • Andoni Garcia (ECVC Coordinating Committee): +34 636 4515 69 – ES, EUZ