What does the new Oireachtas report say about cartels in beef?

There is no evidence to suggest that there is a cartel in operation in the beef processing industry, according to the new Oireachtas report into the future of the sector.

A number of farm groups who gave evidence to the Joint Oireachtas Committee on Agriculture, Food and the Marine levelled accusations that a cartel existed among beef processors in Ireland.

The committee’s new report, entitled “The Future of the Beef Sector in the Context of Food Wise 2025”, heard statements on this issue from several farmer representative groups as well as Meat Industry Ireland (MII) who stringently denied that a cartel exists.

The Irish Natura and Hill Farmers’ Association (INHFA), the Irish Creamery and Milk Suppliers Association (ICMSA), the Irish Farmers’ Association (IFA) and the Beef Plan Movement were all in agreement that there was a cartel at play in the beef sector.

MII argued that the allegations “have emerged without any evidence at all being advanced by anybody”, and that a number of mergers of meat processors have been subject to European scrutiny, without wrongdoing being discovered.

The committee heard from the Competition and Consumer Protection Commission (CCPC), which said that, so far, no evidence of a cartel has been uncovered.

To date, the CCPC’s criminal investigation team has examined a number of complaints and followed various lines of inquiry in the meat processing sector. So far, however, we have not uncovered evidence of a cartel.

Some witnesses said that the EU’s Unfair Practices Directive, which is set to come into power in the member states by May 1, 2021, would address the imbalance of power in the supply chain.

However, the CCPC went on to say that this directive would be “unlikely to succeed” in addressing the lack of power among farmers.

The CCPC is concerned that: the competent authority for implementing the directive hasn’t been set up yet; that it is not clear how many authorities there should be and what roles they should have; and that it is not clear how these bodies should be funded.

As part of its recommendations, the committee called for a regulatory impact assessment (RIA) to be undertaken by Minister Michael Creed to consult with stakeholders on the implementation of the EU directive.

The committee recommended that this RIA should consider: the merits of a dedicated sector regulator to enforce the directive and improve farmer welfare; the costs involved in enforcing the directive; and the merits of an arbitration system to deal with disputes.