With 38 votes in favour, four votes against and two abstentions, the agriculture committee of the European Parliament has approved draft regulations to help improve the farmers' position in the food supply chain. The new rules aim to protect food producers against unfair trade practices (UTP) imposed by big players, put a stop to late payments and short notice cancellation of orders as well as giving food producers the right to request a written supply contract.
“In this battle of David versus Goliath, we are arming the weakest in the food supply chain to ensure fairness, healthier food and social rights. Small producers, workers, consumers, all of us, will soon stop suffering the consequences of unfair trade practices imposed by big players in the food supply chain”, said Italian rapporteur Paolo De Castro.
Action
While the UTP legislation was proposed by Commissioner for Agriculture Phil Hogan, it was the parliament that called for action on the issue back in 2016. The Agriculture Committee also demanded an EU law against UTPs in its 2017 position on the so-called Omnibus proposal. MEPs also discussed the matter with several EU agriculture ministers and agreed with them that an EU law was necessary.
European farm organisations have been lobbying MEPs to pass the new rules.
MEPs broadened the scope of the draft law to:
Include all actors in the food supply chain, and not only small and medium-sized producers and big buyers.Cover trade of agricultural products and ancillary services, on top of foodstuffs.The proposed blacklist of unfair trading practices, as amended by MEPs, includes:
Payments made later than 30 days for perishable agricultural and food products and later than 60 days for non-perishable products, counting from the last day of the month when the invoice was received or the agreed delivery day.Unilateral cancellation of an order of perishable products less than 60 days from the agreed delivery date (Commission proposed no clear deadline). In this battle of David versus Goliath, we are arming the weakest in the food supply chain
MEPs also agreed that the following practices should be outlawed:
Buyers refusing to sign a written contract with the supplier, who would now have a newly established right to request it, or to provide the latter with sufficiently detailed supply terms.Buyers sharing or misusing confidential information, relating to the supply agreement. Terms of a supply agreement must never result from the supplier’s economic dependence on the buyer, MEPs say. They also insist that unless pre-agreed, the buyer should not sell products below the purchase price and then ask the supplier to bridge the gap.
To make life easier for food producers, MEPs propose to allow them to lodge complaints where they are established, even if UTPs occurred elsewhere in the EU.
Next steps
The draft regulations will now be submitted to the plenary to seek MEPs’ approval for negotiations with EU ministers.
Read more
UTP legislation getting closer
Giving power to the farmer
With 38 votes in favour, four votes against and two abstentions, the agriculture committee of the European Parliament has approved draft regulations to help improve the farmers' position in the food supply chain. The new rules aim to protect food producers against unfair trade practices (UTP) imposed by big players, put a stop to late payments and short notice cancellation of orders as well as giving food producers the right to request a written supply contract.
“In this battle of David versus Goliath, we are arming the weakest in the food supply chain to ensure fairness, healthier food and social rights. Small producers, workers, consumers, all of us, will soon stop suffering the consequences of unfair trade practices imposed by big players in the food supply chain”, said Italian rapporteur Paolo De Castro.
Action
While the UTP legislation was proposed by Commissioner for Agriculture Phil Hogan, it was the parliament that called for action on the issue back in 2016. The Agriculture Committee also demanded an EU law against UTPs in its 2017 position on the so-called Omnibus proposal. MEPs also discussed the matter with several EU agriculture ministers and agreed with them that an EU law was necessary.
European farm organisations have been lobbying MEPs to pass the new rules.
MEPs broadened the scope of the draft law to:
Include all actors in the food supply chain, and not only small and medium-sized producers and big buyers.Cover trade of agricultural products and ancillary services, on top of foodstuffs.The proposed blacklist of unfair trading practices, as amended by MEPs, includes:
Payments made later than 30 days for perishable agricultural and food products and later than 60 days for non-perishable products, counting from the last day of the month when the invoice was received or the agreed delivery day.Unilateral cancellation of an order of perishable products less than 60 days from the agreed delivery date (Commission proposed no clear deadline). In this battle of David versus Goliath, we are arming the weakest in the food supply chain
MEPs also agreed that the following practices should be outlawed:
Buyers refusing to sign a written contract with the supplier, who would now have a newly established right to request it, or to provide the latter with sufficiently detailed supply terms.Buyers sharing or misusing confidential information, relating to the supply agreement. Terms of a supply agreement must never result from the supplier’s economic dependence on the buyer, MEPs say. They also insist that unless pre-agreed, the buyer should not sell products below the purchase price and then ask the supplier to bridge the gap.
To make life easier for food producers, MEPs propose to allow them to lodge complaints where they are established, even if UTPs occurred elsewhere in the EU.
Next steps
The draft regulations will now be submitted to the plenary to seek MEPs’ approval for negotiations with EU ministers.
Read more
UTP legislation getting closer
Giving power to the farmer
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