New legislation is needed to ensure fair returns to farmers and growers and transparent prices to consumers, by enforcing fair competition throughout the food supply chain, an agriculture committee of MEPs said recently.
Committee members heard suggestions as to how to ensure fairness throughout the chain by tackling the dominance of retail customers, unfair commercial and contractual practices and late payments, and also by improving the bargaining position of growers and other farmers. The suggestions were set out in a report from French MEP in the greens group and approved by the committee.
The committee also agreed that penalties and a complaint mechanism should be put in place to discourage unfair behaviour by market players, and that there should be a pilot project to create a European "observatory" of farm prices and margin.
The committee’s stance reflects trends in UK, French and Spanish markets which are calling into question the relationship between major multiples and the supply chain and seeking greater regulation of the relationship in the case of the UK, and more transparency on pricing in the case of France and Spain.
The committee is also urging the European Commission to propose legislation to limit dominant market positions at every stage of the supply chain, including the food processing industry and retailers and that those companies engaging in unfair practices should be "named and shamed".
Standard contracts could be useful tools in preventing practices such as the alteration of contract terms, late payments, resale at a loss and unjustified listing fees, say MEPs. In some sectors, these contracts could even be made compulsory.
Specifically, the Commission is urged to examine the effects of "contract farming", imposed by buyers, which can weaken farmers' bargaining position. Finally, the committee asks that the Commission table legislation to reduce the maximum period allowed for payments from buyers to producers to 30 days for all.
Finally, the text asks the Commission to report on the issue of wasted food and to launch a campaign to raise awareness of the value of food.
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