‘EU’s food supply chain proposal must address power imbalances’

This week will mark significant developments on action to address “serious problems” in the food supply chain, Irish MEP Mairead McGuinness has stated ahead of the publication of an EU Commission proposal on tackling unfair trading practices.

However, the vice-president of the European Parliament has warned that the proposal must be robust enough to address power imbalances in the food supply chain which lead to unfair practices.

It is understood that the proposed new EU law will take the form of a directive defining actors in the chain. It will set out a list of specific prohibited unfair trading practices (UTPs).

“At a time when primary producers are under severe income and cost pressures and the Common Agricultural Policy (CAP) support budget is also under threat; it is vital that the food market operates along transparent and fair trading practices.

This is an area I have worked on for a number of years and it has taken too long for a legislative response to emerge.

The Midlands North West MEP highlighted the substantial pressure farmers are currently under due to the impact of poor weather – which impacts not just on financial viability; but, also on the wellbeing of farmers.

Speaking from Brussels ahead of an extraordinary meeting of the parliament’s Agriculture Committee this Thursday (April 12) – at which EU Commissioner for Agriculture and Rural Development Phil Hogan will present his proposal – McGuinness praised the commission’s response to demands for action.

“This is a significant week for the agri-food sector, with the EU taking action on a food supply chain that has many actors and which is prone to severe power imbalances and a lack of transparency.

It is also a marketplace where primary producers are fearful of speaking out when they face unfair practices, as they risk being delisted and losing a market outlet.

‘Hello money’

It is understood that under the draft proposal member states’ enforcement authorities will be able to enforce prohibited practices – either on its own initiative, or by way of complaints by actors affected by UTPs.

“The parliament’s Agriculture Committee will analyse the proposal and amend it as necessary to address problems in the food chain such as ‘hello money‘”, added McGuinness, a member of the Agriculture Committee.

The proposal will complement member states’ existing laws that tackle UTPs and the Supply Chain Initiative’s (SCI’s) code of conduct.

“In Ireland, the Groceries Goods Regulations took effect in April 2016. The regulations are monitored by the Competition and Consumer Protection Commission (CCPC). The CCPC also has the responsibility of investigating complaints and has the power to take enforcement action – if appropriate,” she said.

In 2016, McGuinness received widespread support from her European colleagues – 600 votes – for her recommendation on the necessity of introducing legislative action at EU level to tackle UTPs.