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Commission proposals on Unfair Trading Practices don’t go far enough - Carthy response to Phil Hogan proposal

12 April, 2018 - by Matt Carthy MEP

Matt Carthy MEP has said proposals submitted by the EU Commission to tackle unfair trading practises would not be sufficient to address the price pressures on farmers.

Carthy, a member of member of the European Parliament’s Agriculture & Rural Development committee, was speaking following interaction at the committee today with Commissioner Phil Hogan who presented his long-awaited proposal for a directive to tackle unfair trading practices. 

Matt Carthy said:

“The publication of legislative proposals on Unfair Trading Practices (UTPs) by the commission is welcome considering farmers have been waiting nine years for this move. However, I fear that the proposals do not go far enough to address the inequalities in price negotiations faced by farmers.  

“The Commissioner chose to present minimum measures with the stated intention that the co-legislators will strengthen it.  Why not start from the other position whereby the commission presents a strong and robust proposal and allow us to fight to maintain the maximum support for farmers during the legislative process?

“The Commissioner’s response effectively indicated that this was as good as he could secure among his fellow college members suggesting that he has some work to do on his negotiating skills. 

“The basis of the commission proposal is the restriction of just eight unfair trading practices, and four of these can be permitted if set out in initial contracts between farmers and buyers. 

“But we know that it is often in the contract negotiation phase that farmers feel the most pressure from factories and supermarkets, so under the current proposal it is likely that half of these UTP’s will continue to be seen in the future.  Remember that these negotiations regularly involve individual farmers across from some of the largest and most powerful corporations in the world.  Farmers are depending on UTP legislation to protect and support them in their bid to secure fair terms.

“I do not believe that the Commissioner can look any farmer in the eye and tell them that they will now receive a fair price for their product on the basis on his proposition.  Agriculture is likely to remain the only sector in which it is commonplace for producers to sell their goods below the cost of production.  This is the reason why UTP legislation is required and why it is so important that we get it right.

“Farmers are being forced to use CAP payments to make up the difference between the cost of production and the shrinking payments from buyers.  Essentially this means that EU money is ending up in the hands of corporations who employ oppressive tactics. 

“Cleary the system is broken. This is why I have consistently called for national and EU legislation to ban the selling of products below the cost of production. 

“I have been closely following the recent proposal in France, which regulates minimum buying prices and limits bargain sales.  The minimum will mean the product must be sold at least for the purchase price plus 10%.  Retailers will also not be able to discount a product more than 34% of its price.  This proposal is not perfect but it is a step in the right direct to place farmers on an equal footing and should be examined by Irish authorities.  

“One way or another, it will be at least 2.5 years before the directive is transcribed into national law and before Irish farmers see any change.  In the meantime, I intend to propose a number of amendments to add some meat to the bare bones proposal presented by the commissioner, in the interest of providing farmers a secure and viable future.  At national level, Sinn Féin will continue to call for the reintroduction of the groceries order for Agricultural products to ban below-cost selling”.

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