Brussels' WAR on supermarkets: EU cracks down on unfair trading to defend farmers
BRUSSELS has taken aim at Europe’s top supermarkets as politicians look to roll out new laws to protect farmers.
Phil Hogan attacked supermarkets in the row over paying farmers
Huge chains such as Britain’s Tesco and France’s Carrefour could face the full wrath of the European Union over claims farmers have almost no bargaining powers against the supermarket giants.
And they are demanding the EU rolls out key new laws to end unfair trading practices, including late payments and abusive contracts.
The row has been brewing for years and so far Brussels has managed to stay out of the argument.
But on Friday that all changed when European Commissioner for Agriculture Phil Hogan launched a scathing attack on big name supermarkets in a speech at Dublin Castle.
Tory MP says EU farmers will suffer the most after Brexit
Farmers say they are at the mercy of supermarkets
He said: “Concretely, supermarkets in particular now enjoy ‘super power’ due to the twin effect of increased globalisation and a high level of concentration within Europe.
“This gives them disproportionate leverage over primary producers.
“The imbalance of bargaining power between price setters and price takers is stark, leading to a situation where there is a real ‘fear factor’ for farmers of commercial retaliation, late payments and other headaches.”
Mr Hogan also used the speech to announce he would be looking at drafting new legislation to protect farmers - including improving price transparency and increasing the power of agricultural cooperatives.
The proposals are expected early next year.
Supermarket chains claim they would be unfairly targeted by the plans
However some supermarket chains claim they would be unfairly targeted by the plans.
Tesco, Sainsbury’s and Asda chains control nearly 60 per cent of the UK grocery market.
In France, Carrefour, E. Leclerc and Intermarché command more than 55 per cent.
But chains such as Lidl and Carrefour say they actually only buy five per cent of their stock directly from farmers and instead deal with processing firms such as Nestlé and Danone.
Neil McMillan, director at EuroCommerce, an industry lobby representing supermarket groups such as Carrefour, Tesco and Lidl, said: “This is a narrative which has been built up by the farming community — that all their problems can be blamed on retailers.”