EPP Group backs key measures to protect farmers from unfair trading practices

The European Parliament's Agriculture Committee voted this evening on measures to stop Unfair Trading Practices (UTPs) in the food supply chain.

"The EPP Group has been asking the Commission for this initiative to stop UTPs for a number of years and this is a first step in recognising that the food supply chain is unbalanced," said MEP Mairead McGuinness, EPP Group spokesperson on the issue.

This is a first step in recognising that the food supply chain is unbalanced Mairead McGuinness MEP

"Many of the practices engaged in by the powerful, harm farmers and others who lack power. The Directive will allow farmers to complain - in confidence - where they believe that buyers are engaging in unfair trading practices."

“The vote this evening will guide the Parliament's work in its negotiations with Member States on the legislation. Several Member States already have national legislation on UTPs in the food supply chain. Our aim is to ensure that there is EU-wide legislation and that it is effectively implemented."

“For too long we have seen, and continue to see, a concentration of power at buyer level. This results in an uneven situation whereby farmers have little influence in the marketplace and can be subject to practices which cut their margins in ways which are blatantly unfair."

Our aim is to ensure that there is EU-wide legislation and that it is effectively implemented

“This is a step towards a more sustainable food supply chain - allowing farmers to address their concerns about how they are being treated to an authority which must act and investigate. We need a more sustainable food supply chain and UTPs work against this."

"We need fair margins to be earned by everyone in the chain in order for sufficient investment to be made to meet demanding challenges, including environmental and climate issues."

"There is a determination to have this legislation agreed by early next year and for Member States to start implementing it as soon as possible. However, there is still opposition to the legislation with efforts being made to thwart it," Mrs McGuinness recalled.

Background:

The proposal distinguishes between two kinds of trading practices. While many are simply unfair in nature, others may be acceptable if clearly agreed by the parties, and become unfair only when applied without agreement.

Trading practices falling into the first group and which would be prohibited include:

- Late payment by buyers for perishable food products  - greater than 30 calendar days;

- Short-notice cancellation of orders of perishable food products;

- Unilaterally and retroactively changing the terms of the supply agreement;

- A supplier having to pay for the wastage of food products on the buyer's premises not caused by the negligence or fault of the supplier.

Further additional trading practices would be prohibited unless agreed in clear and unambiguous terms in the supply agreement:

- Returning unsold food products to the supplier;

- Charging the supplier for stocking, displaying or listing their products by the buyer;

- Charging the supplier for the promotion of products sold by the buyer;

- Charging the supplier for the marketing of products by the buyer.