Mairead McGuinness MEP and European Parliament Vice-President has welcomed a recommendation by the Agriculture Market Task Force calling for the European Commission to introduce EU framework legislation to tackle unfair trading practices (UTPs) in the food supply chain, as outlined in a new report published Monday.
"UTPs can involve large retailers abusing their power in the food supply chain, pushing down farm incomes, threatening the sustainability of the food supply chain and reducing consumer choice. Some 20 Member States already have separate and individual responses to UTPs,” she said
“For the sake of all EU producers and for the sake of the single market, an EU approach to the problem is necessary," said McGuinness, a firm advocate for legislative action to compel retailers to deal fairly with suppliers.
"The report from the Task Force reflects the view of the European Parliament while also acknowledging that this is a complex and difficult area to legislate on. However, this not a reason to shy away from rooting out unfair and unethical practices in the food chain," stated McGuinness.
The report states that EU framework legislation should introduce a ban on specified unfair practices, including the following:
- no payment periods longer than 30 days,
- no unilateral and retroactive changes to contracts (concerning volumes, quality standards and prices),
- no contributions to promotional or marketing costs,
- no claims for wasted or unsold products,
- no last minute order cancellations concerning perishable products
- no requests for upfront payments to secure or retain contracts.
It further calls for a system whereby those affected by unfair trading practices can make anonymous complaints, in order to overcome the well-recognised "fear factor" which prevents people from complaining for fear of being delisted. It also states that sanctions to tackle unfair trading practices need to be dissuasive in nature, in order to be effective.
Today's recommendation from the Task Force followed an initiative from the EU's Agriculture Commissioner, Phil Hogan, to look for ways to improve the position of farmers in the supply chain. Ultimately, the introduction of legislation falls with Commissioner Bienkowska.
In January, the Internal Market Commissioner indicated that at this stage she did not foresee the introduction of a harmonised regulatory approach at EU level and that Member States' actions needed time to be fully assessed. The task force takes a different view and it is up to the Commissioners to come together on this issue in the best interests of consumers and producers, according to McGuinness.
The task force also calls for the continuation of the voluntary Supply Chain Initiative, urging farmers to get involved in this process, which up to now they have not signed up to, as it fails to provide anonymous complaints.
"Political pressure applied by myself and other colleagues for a considerable time has resulted in a more proactive approach within the sector with the development of the voluntary code of conduct, the Supply Chain Initiative, which I welcome. This has resulted in improved behaviour but is it enough? Legislation should reinforce the voluntary code not interfere with it.
“For me the most important point is that problems in the food supply chain, the relentless pressure that prices are having on producers and conditions of sale cannot continue without negative consequences for producers and consumers," concluded MEP McGuiness