EU Takes Aim at Food Retailers

telecomunicationThe European Commission has put large supermarket and food retail business under its regulatory radar, in an attempt to rationalize the European food supply chain. The initiative, likely to make its debut as early as in 2018, will place producers and farmers under its aegis, in an attempt to bridle at the hypermarkets power by remedying unfair trading practices and arbitrary contractual clauses.

The current situation has allowed for the accumulation of disproportionate market powers to a few retailers, raising controversy over the misuse of dominant position, price controls as well as abusive and retaliatory business practices. Moreover, the present environment has driven many small-scale producers out of the market, threatening to compromise the entire EU agricultural sector.

Following closely the 2016 recommendations of the Agricultural Market Task Force, the new bill will focus on issues of price fairness and transparency by allowing collective price negotiations and imposing a mandatory price reporting system. Furthermore, the possibilities of easier access to finance for producers as well as the establishing of an independent adjudication system are on the table.

Currently, no concrete proposal has been presented yet. The nascent bill is expected to take form during the following months. This initiative will target primarily supermarkets and food retail business. NGOs and consumers organizations are already voicing their concerns to try and shape the proposal.