April 11, 2018 / 3:02 PM / 10 months ago

EU to launch plan to protect European farmers from unfair trading

BRUSSELS (Reuters) - The European Commission will announce a series of measures on Thursday to protect small European farmers and food producers from what it says are unfair trading practices by larger corporations.

A French farmer drives his tractor in his field in Beauvois-en-Cambresis, near Cambrai, France, April 6, 2018. Picture taken April 6, 2018. REUTERS/Pascal Rossignol

The measures, which still need to be approved by member states and the European Parliament, will outlaw practices such as late payments, last-minute order cancellations and retroactive changes to contracts by the buyer.

Only small and medium-sized producers, which are defined as having fewer than 250 employees or an annual turnover of less than 50 million euros ($62 million), are targeted by the proposal.

While there are already several national laws in place that have a similar aim, the Commission said it wanted to harmonise these rules across the European Union.

The move by the European Commission follows similar efforts in France, where President Emmanuel Macron has said he would raise minimum prices retailers can charge on food products and limit bargain sales in supermarkets.

Caught between the prospect of lower agricultural subsidies and excess supply of certain products such as milk, European farmers have long complained about being hit by squeezed margins and retail price wars.

Dutch farming association LTO said it would welcome the new rules proposed by the European Commission.

“We believe farmers are not always treated fairly in the value chain,” an LTO spokesman said.

The proposal was criticised by the association of European retailers EuroCommerce, which said such legislation would increase prices to consumers, while not addressing basic imbalances between supply and demand.

“Regulating trading practices will not solve these market issues and inefficiencies,” Eurocommerce said.

($1 = 0.8089 euros)

Reporting by Robert-Jan Bartunek; Editing by Adrian Croft

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