EU competition policy must work for farmers too, Agriculture MEPs say
The EU’s competition policy must defend interests of farmers with the same vigour as it defends those of consumers, the Agriculture committee said on Tuesday. In an opinion for the Economic and monetary affairs committee on the Annual competition policy report MEPs stressed that Union’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.
“To effectively strengthen the position of farmers in the food supply chain, we need a real clarification of EU competition law and rules on agricultural market organization. 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 organize, to join forces. They live in a constant fear of receiving fines and being subject to controls by national competition authorities”, said rapporteur Michel Dantin (EPP, FR).
“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 organization 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,” he added.
Fair price means also fair pay
EU rules governing competition on and access to the Union’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, says the approved text. 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.
Clarify current derogations from competition rules
The committee believes that the current farming crisis calls improvement of existing tools to tackle it. The EU’s competition policy must take a better account of the specific nature of agriculture to this end, MEPs say.
Current competition derogations remain unclear, ambiguous, difficult to implement and are divergently applied by national authorities. They therefore call on the Commission to clarify their scope.
Clamp down on concentration and strengthen small farmers in the chain
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, says the approved text. For instance MEPs call 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 calls 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.
Come up with an EU law to tackle unfair trading practices in the chain
Competition policy alone cannot fully solve unfair trading practices (UTPs) in the food supply chain, Agriculture MEPs say. They reiterated Parliament’s call for an anti-UTPs EU law, which should ensure that farmers and consumers could benefit from fair selling and buying conditions.
The opinion, approved by the Agriculture committee with 37 votes in favour to four against, with one abstention, will be scrutinised by the Economic and monetary affairs committee on 5 December and then, early next year, by the Parliament as a whole.