NEW EP-RESOLUTION: A SIGNIFICANT STEP AGAINST UNFAIR TRADING PRACTICES

The Hungarian food chain inspection authority (“NÉBIH” in Hungarian) welcomes the new resolution on unfair trading practices in the food supply chain, recently adopted by the European Parliament. The unfair trading practices (like payment delay, restricted access to the market, unilateral or retroactive changes to contract terms, etc.) represent a serious problem in the sector, in particular in the food supply chain. These practices have severe negative consequences for farmers, such as lower profits, higher-than-estimated costs, food overproduction and wastage, financial planning difficulties and ultimately reduced consumer choice.

The members of the European Parliament stated that the Supply Chain Initiative and other national and EU voluntary systems (codes of good practice, voluntary dispute settlement mechanisms) should be further developed, as it turned out that some national platforms have not delivered on these objectives. According to the resolution, Member States should establish or recognize public agencies or dedicated bodies like an adjudicator at national level responsible for enforcing actions to combat unfair practices in the food supply chain. The MEPs emphasized the importance that complaints can be lodged anonymously, and proposed to establish dissuasive penalties.

The MEPs proposed to extend the list of examples of fair and unfair practices in vertical relations in the food supply chain. By adopting the resolution now, the MEPs have sent a clear message by inviting the Commission to submit a proposal for an EU-level framework. Now the European Commission shall make steps to draft an EU legal framework in order to tackle unfair trading practices.