‘EU competition policy must work for farmers too’

The European Union’s competition policy must defend interests of farmers with the same vigour as it defends those of consumers, according to the EU’s Agriculture Committee.

In an opinion for the Economic and Monetary Affairs Committee on the annual competition policy report, MEPs stressed that the EU’s competition rules must be better aligned to needs of the agricultural sector.

They also once again called for an EU law to tackle unfair trading practices and measures to strengthen farmers’ bargaining position.

Rapporteur Michel Dantin said that to effectively strengthen the position of farmers in the food supply chain, there needs to be a real clarification of EU competition law and rules on agricultural market organisation.

“While the retail sector is rapidly concentrating at the national and European level in the absolute indifference, it is not sufficiently allowed for farmers, who wish to organise, to join forces.”

They live in a constant fear of receiving fines and being subject to controls by national competition authorities.

Dantin said that by adopting conclusions similar to the recommendations of the Agricultural Markets Task Force, in particular on the fight against unfair trading practices, EU competition law and the organisation of the agricultural sector, the Agriculture Committee sends a strong signal to the European Commission.

“The ball is now in its court and we expect concrete initiatives.”

MEPs have also said that EU rules governing competition on and access to the EU’s internal market must be fair also for farmers to foster investment, employment, innovation and viability of agricultural businesses as well as balanced development of rural areas.

MEPs insist that a concept of a ‘fair price’ for agricultural products should not be understood as a lowest possible price for consumers but a reasonable price that allows fair remuneration for all in the food supply chain.

Clamp down on concentration and strengthen small farmers in the chain

Meanwhile, MEPs also said that the Commission should adopt “a more extensive approach” in defining dominant position and its abuse by agricultural undertakings, taking into account the degree of concentration and constraints resulting from the negotiating strength of the input, processing and retail sectors.

For instance MEPs called on the EU’s executive and national authorities to look into the rapid concentration in the distribution sector on a national level and the development of European alliances of major distributors on the EU level, which reduces competition and hinders innovation in the food supply chain.

MEPs stress that collective activities of producer organisations (POs) and their associations, such as production planning, sales negotiations and sometimes negotiations of contract terms are positive for the agricultural sector and should therefore be deemed as compatible with EU competition rules.

The committee also called on farmers to fully exploit the POs’ potential and on the Commission to relax contractual negotiations criteria olive, beef, veal and arable crops farmers have to comply with.

MEPs also want the EU’s executive to come up with a proposal to ensure the so-called Milk Package continues to apply beyond 2020 and to extend it to other agricultural sectors too.

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