Retailers the wrong target for action on the supply chain

(content provided by EuroCommerce) EuroCommerce Director-General Christian Verschueren has expressed his concern towards Agriculture Commissioner Phil Hogan that some of the statements in his speech on 5 October in Dublin could polarise the debate.

“Damaging picture”

“The speech has been portrayed by some of the European press as the Commission “declaring war on retailers”, which, as I am sure you will agree, paints quite a damaging picture of a relationship between the Commission and a sector that is key to providing a reliable supply of food to consumers at reasonable prices. Isn’t this what the CAP chapter of the Treaty, and the Commission as its guardian, also aim to ensure? We worry that by demonising retailers, the issue is again becoming polarised, when the supply chain needs reasoned debate and dialogue, based on factual evidence”, Verschueren writes. 

He also questions whether the announcement in the Commissioner’s speech of the Commission now working towards legislation on so-called unfair trading practices is not premature: “This surprised us considerably, as the Commission’s consultation leading to the substantive Impact Assessment runs until 17 November.  It is surely rather premature, and not in line with the Commission’s Better Regulation framework, to be announcing now that the Commission has already made up its mind what form any such action should take.”

The letter asks the Commission to provide concrete evidence that EU legislation will be able to achieve its stated aim of improving farmers’ situation in the supply chain: “The Inception Impact Assessment did not supply any new evidence to support abandonment of the Commission’s conclusion just a year ago that EU-level legislation offered no added value. It only presented a couple of perception studies dating back a number of years, as evidence of a problem between farmers and retailers. And it did not address the basic question which the Commission needs to answer in advocating EU legislation:  if retailers do not deal significantly with farmers, and if most of the practices identified by the Agri-Markets Task Force apply principally or exclusively to retailers’ dealing with large multinational brands, what can EU legislation covering these practices do to help the position of farmers?”

Verschueren concluded by stressing the importance in all of this debate of the consumer: “We agree with the Commission on many points in looking to improve the position of farmers – more transparency, better cooperation among farmers… But if such legislation squeezes retailers further in dealing with their large suppliers, it is the consumer – whom the Inception Impact Assessment incidentally failed to mention once – who will end up footing the bill.”