Protecting farmers: European Council agrees on new rules to crack down on unfair trading practices

European member states’ representatives met earlier this week to approve plans for a new regulation to tackle cross-border unfair trading practices in the agri-food supply chain.

In 2019, the directive on combating unfair trading practices entered into force to address imbalances in bargaining power between suppliers and buyers of agricultural products. 

However, since the six years that this directive has been active, the Commission now considers that the cross-border dimension of unfair trading practices needs to be strengthened.

It notes that approximately 20% of agricultural and food products consumed in an EU member state come from another member state.

Calls for more robust action

New plans specifically aim to better protect European farmers who sell their products to retailers and food processing companies. They also address the imbalances in bargaining power between agricultural product suppliers and buyers.

During the Special Committee on Agriculture (SCA) this week, the European Council’s negotiating mandate was approved. 

It calls for a robust set of rules on cross-border cooperation against unfair trading practices in business-to-business relationships. In particular, the new rules would improve transnational cooperation in cases where suppliers and buyers are in different member states.

The SCA heard that the new proposals would introduce two new mechanisms. The mutual assistance mechanism would allow national enforcement authorities to ask for and exchange information and request that another enforcement authority take measures on their behalf.

It would also include a mechanism for coordinated action in cases of large-scale cross-border unfair trading practices involving at least three EU countries. When this happens, a coordinator will be designated to facilitate the response.

Improving farmers’ position in the supply chain

New rules could cover costs incurred in mutual assistance cases. The member state requesting information or asking for investigative or enforcement measures would cover the necessary costs incurred by the member state carrying out the investigation or enforcement. 

Czesław Siekierski, Polish Minister for Agriculture and Rural Development, says, “Our farmers deserve to earn a fair standard of living from their work. With these rules, we will better protect them against unfair trading practices across borders and strengthen their position in the food supply chain.”