Failure to ban below-cost selling represents missed opportunity to tackle Unfair trading Practices – Matt Carthy MEP
The Sinn Fein MEP for the Midlands North West, Matt Carthy, has branded the final text of the new EU Unfair Trading Practices (UTPs) legislation as too little too late. Speaking after a vote on the final agreement on UTPs in the European Parliament’s Agriculture & Rural Development committee on Wednesday, Carthy said that the failure to include below-cost selling by retailers represented a missed opportunity to rebalance the unequal position that farmers are in when negotiating with large corporates.
Matt Carthy said:
“Farmers have been waiting several years for promised legislation banning unfair trading practices. It was crucial that we deliver something substantive. Unfortunately this legislation does not reflect the ambition that was required.
“It is important to note that the Commission divided the UTPs into a black and a grey list. Only UTPs on the black list will be banned, while the rest will still exist as long as they are included in the supply contract.
“The original commission proposal included a total of just 4 banned UTPs. The Agriculture & Rural Development Committee increased this to 44, but these didn’t include the crucial ban on below-cost-selling. Following negotiations with the commission and council the number of UTPs has been reduced again to 6 black list UTPs, in addition to the initial 4 from the Commission.
“The additional ‘grey’ list of UTPs will likely continue on a widescale basis considering the weak position of farmers in their negotiations with retailers. Parliament had proposed to strengthen this by inserting a clause that would permit farmers to submit a complaint relating to a clause in the contract if it could be demonstrated that it was only put there due to the economic dependence of the supplier on the buyer, and it did not serve their interests. However, this protection has been removed.
“In terms of the ambition of this legislation, the failure to include a ban on below-cost selling will mean that the position of retailers in the market chain will continue to be a manipulative one. This was the area with which this legislation could have had an immediate and positive impact for primary producers and the failure to include it in the final list of UTPs represents a missed opportunity.
“Unfortunately the UTPs selected as part of the final agreement will make a minimal difference to the income of farmers or their positioning in negotiations and I fear that the imbalances in the market will remain in place. Farmers will continue to receive small fractions of the profits made by processors and retailers despite that fact that it they who are primarily responsible for producing the food we eat.
“The final text does have some positive elements, including my proposals for the banning of charging producers for the examination of customer complaints; mandating written contracts; and banning changes to the supply contract after agreement. Proposals allowing NGOs to make complaints on behalf of farmers, and extending the Directive to include offences by non-EU based buyers have also been adopted. But they don’t go far enough.
“While Ireland will not be precluded from introducing more comprehensive rules at national level, and Sinn Féin will continue to press for improved measures, including the reintroduction of a groceries order to ban below-cost selling on agriculture products, the truth is that this legislation was the best opportunity to effectively stand on the side on our family famers.
“Considering the potential that this legislation provided to address the severe imbalances in the negotiating position of small suppliers and primary producers, and that this potential has not been realised, I voted against this agreement. Our farmers deserved better”.