The European Commission is calling farmers and all smaller suppliers across the food supply chain to share their views on their experience with unfair trading practices.
A survey is currently available online in all EU languages until 15 March 2024. During the recent weeks, farmers and their associations raised concerns about the prevalence of unfair practices within the food supply chain. By participating in the survey, farmers and smaller suppliers can express their concerns and share their experiences with unfair trading practices. After presenting options for simplification to reduce the burden for EU farmers, the Commission is also working on actions to improve the position of farmers in the food chain and to improve the enforcement against unfair trading practices.
The survey, managed jointly by the Joint Research Centre and the Directorate-General for Agriculture and Rural Development of the European Commission, specifically targets EU farmers and smaller suppliers operating within the agricultural and food supply chain, covering various stages of production and distribution. Respondents can share whether they have experienced unfair trading practices lately from buyers economically stronger.
Before a product reaches the consumer, several market participants take part in the food supply chain (producers, processors, retailers, etc.) and add to its value and impact on the final price paid by the consumer. The abuse of bargaining power between different operators in the supply chain may sometimes lead to unfair trading practices that can have harmful effects.
What does this mean for greenhouse- and indoor producers?
Protection from unfair practices:
Greenhouse and indoor producers are often smaller suppliers within the agricultural and food supply chain. By participating in the survey and providing their feedback, they can express any unfair practices they have experienced. This includes issues like late payments, order cancellations, or retroactive changes to contracts, which the Directive aims to address.
Increased awareness and empowerment
The Directive empowers farmers and smaller suppliers to speak up about unfair practices in a confidential manner. This means greenhouse and indoor producers can report any instances of unfair treatment they encounter without fear of retaliation. Moreover, the directive enables authorities to conduct sector inquiries to identify and penalize unfair trading practices, providing further protection to these producers.
Improved market conditions
The actions proposed by the Commission, such as enhancing market transparency and implementing/enforcing the Directive, can lead to improved market conditions for greenhouse and indoor producers. This could include measures to ensure fair pricing, reduce transaction uncertainties, and enhance overall market stability, benefiting producers throughout the supply chain.
Cost considerations
The Commission's actions may also address the costs of production, which can be significant for greenhouse and indoor producers due to the energy-intensive nature of their operations. By addressing cost-related issues, such as ensuring fair pricing and reducing unnecessary expenses imposed by unfair practices, producers may benefit from improved profitability and sustainability.
Access to information and support
The Commission's efforts to raise awareness of existing protections and enforcement mechanisms can benefit greenhouse and indoor producers by providing them with better access to information and support. This can help them navigate the complexities of the supply chain more effectively and ensure their rights are protected.
What it entails
Upon a proposal of the Commission, the European Parliament and the Council adopted in April 2019 a Directive on unfair trading practices (UTPs) in business-to-business relationships in the agricultural and food supply chain. The Directive bans several unfair trading practices that were too often taking place: late payments for perishable and non-perishable food products; last-minute order cancellations; unilateral or retroactive changes to contracts; forcing the supplier to pay for wasted products and refusing written contracts. It also empowers farmers to safely speak up in a confidential manner and for authorities to launch sector inquiries to identify and fine unfair trading practices.
Member States, in charge of enforcing these rules, were required to transpose the Directive into their national legal framework by 1 May 2021 and apply it six months later. To take stock of the prevalence of prohibited unfair trading practices and to assess the effectiveness of measures taken at the national level, the Commission is conducting annual surveys. The survey currently open is the third one since the first baseline survey was conducted before the implementation of the Directive. The results will be used in the evaluation of the current rules that the Commission is required to carry out by 1 November 2025. Last year's survey revealed for example that more than 60% of respondents to the survey were not even aware of the existence of the enforcement authorities. This shows that more can be done, both in terms of awareness of the protection available for farmers and smaller suppliers as well as about enforcement when complaints are filed.
To strengthen the position of farmers in the food supply chain, the Commission will present in March to Member States several actions that may cover issues such as market transparency in the value chain, implementation of the Directive against unfair trading practices and its enforcement, costs of production, or more homogeneous control of existing rules on imported agricultural products.
Source: European Commission