COMMISSION STAFF WORKING DOCUMENT STAKEHOLDER CONSULTATION - SYNOPSIS REPORT Accompanying the document Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND THE COUNCIL on unfair trading practices in business-to-business relationships in the food supply chain
Date: 2018-04-12
Institutions: Directorate-General for Agriculture and Rural Development, European Commission
Subjects: agri-foodstuffs, chain store, consumer protection, food industry, restriction on competition, small and medium-sized enterprises, supplier, supply, unfair terms of contract

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 12.4.2018  SWD(2018) 91 final  COMMISSION STAFF WORKING DOCUMENT STAKEHOLDER CONSULTATION - SYNOPSIS REPORT  Accompanying the document Proposal for a  DIRECTIVE OF THE EUROPEAN PARLIAMENT AND THE COUNCIL on unfair trading practices in business-to-business relationships in the food supply chain {COM(2018) 173 final} - {SWD(2018) 92 final} - {SWD(2018) 93 final}  
 
 
Contents 

1. 

Stakeholder consultation process ............................................................................................ 2 

2. 

Summary of stakeholder consultation results .......................................................................... 2 

2.1. 

Inception impact assessment .................................................................................................. 2 

2.2.  Open public consultation ........................................................................................................ 3 

2.3. 

Targeted questionnaire to undertakings ................................................................................. 6 

2.4. 

Targeted questionnaire to consumer organisations ............................................................... 6 

2.5.  Questionnaire to Member State public authorities ................................................................ 7 

2.6. 

Joint Research Centre academic workshop on UTPs in the food supply chain ....................... 7 

2.7. 

Ad hoc meetings with food supply chain stakeholders ........................................................... 7 

2.8. 

Civil Society Dialogue groups................................................................................................... 7 

1 

 
 
 
 
1.  Stakeholder consultation process 

The stakeholder consultation process was set out in a consultation strategy1 and carried out between 17 
July and 6 December 2017.   

Stakeholders  were  invited  to  offer  comments  and  evidence  on  problem  definition,  policy  objectives, 
the  need  for  EU  action,  policy  options,  on  the  likely  impact  of  the  policy  options,  and  on 
implementation issues, including monitoring and enforcement. The stakeholder consultation meets the 
requirements in the better regulation guidelines. 

2.  Summary of stakeholder consultation results 

2.1. Inception impact assessment 

The  inception  impact  assessment  received  significant  attention,  with  66  contributions  submitted  by 
various  stakeholders2.  33%  of  these  were  farmers  or  farming  organisations,  17%  Member  State 
authorities, 15% non-governmental organisations (NGOs), 11% processors and their organisations, 8% 
retailers  and  their  organisations,  and  17%  other  respondents  (academia,  trade  unions,  traders,  and 
anonymous).  It  should  be  noted  that  the  inception  impact  assessment  feedback  process  is  not 
structured in the sense of a questionnaire. Instead the text of the contributions was sifted for relevant 
information in a systematic way ex post. 

91% of respondents agreed that UTPs exist in the food supply chain (5% did not reply, and 5% did not 
state  a  clear  position).  76%  of  respondents  stated  that  UTPs  caused  a  significant  problem,  and  14% 
that they did not3. 5% of respondents stated that UTPs existed but with an overall positive effect on the 
food supply chain in terms of efficiency. 

71%  of  respondents  believed  there  was  a  need  for  the  EU  to  act  (from  64%  of  ‘other’  to  90%  of 
NGOs;  farmers  82%,  Member  States  73%,  processors  71%),  except  for  retailers  (100%  of  retailers 
believed the EU should not act). 

Only 5% of respondents commented on the inclusion or exclusion of food products in the scope of the 
initiative, being broadly in favour of inclusion. 41% commented on the extent to which food supply 
chain operators should be included, with 82% in favour of covering the full supply chain (the outlier 
being the processing sector, where only 57% of respondents were in favour of covering the full supply 
chain). 

20%  of  respondents  mentioned  the  fear  factor,  generally  considering  this  effect  to  exist  and  to  be 
significant. 62% believed the possibility of making anonymous complaints should exist, 38% believed 
it should not). 92%  believed sanctions against those practicing UTPs should exist, 8% believed they 
should not). 17% of respondents mentioned cooperation between Member State authorities, with most 
being supportive of cooperation. 

1 
2 
3 

European Commission, Consultation Strategy – Initiative to improve the food supply chain, 2017 
Individual contributions are listed in the inception impact assessment webpage. 
In the remaining of the inception impact assessment subsection the percentages for ‘no response’ or ‘unclear position’ are omitted. 

2 

 
 
                                                            
2.2. Open public consultation4 

Overview of respondents 

The  open  public  consultation  (OPC)  results  were  consistent  with  those  of  the  IIA.  The  OPC  ran  for 
three months, between 25 August and 17 November, and attracted a total of 1,432 responses(56%  by 
individuals  -  803  responses  -  and  44%  by  organisations  -  628  responses).  71%  of  individuals  stated 
they  were  involved  in  farming  (570  responses),  and  29%  that  they  were  not  (233  responses). 
Organisations’  contributions  were  mainly  by  private  companies  (38%  of  organisations’  responses), 
business  and  professional  associations  (31%),  and  NGOs  (20%).  In  terms  of  sector  of  activity,  the 
organisation responses were from agricultural producers (53% of organisations’ responses); the agro-
food  sector  (22%);  the  trade  sector  (7%);  civil  society  organisations  (7%);  the  retail  sector  (4%); 
research organisations (1%); and ‘other’ ( 6%). 

The ‘private company’ group can be further broken down by company size, (number of employees). 
Small  and  medium  enterprises  (SMEs)  were  81%  of  private  company  responses).  Large  enterprises 
(those with more than 250 employees) were 19% of all private company contributions. 

In  terms  of  Member  State  of  origin  the  highest  participation  came  from  Germany  (29%  of  total), 
Austria  (14%),  France  and  Spain  (7%).  The  lowest  from  Croatia,  Luxembourg,  and  Cyprus  (1 
contribution each). 

Respondents’ views 

a)  Problem definition5 

 90% of respondents agreed or partially agreed that there were practices in the food supply chain that 
could be considered to be UTPs. These results were broadly similar for all stakeholder groups, with 
the  exception  of  the  retail  sector  (12%  agreed  or  partially  agreed  UTPs  existed  in  the  food  supply 
chain, and 88% disagreed or partially disagreed – most of these partially disagreed, at 72%).  

The  respondents  were  then  asked  whether  a  list  of  practices  could  be  considered  to  be  UTPs,  with 
respondents agreeing or partially agreeing at between 80% (payment periods longer than 30 days for 
agro-food  products  in  general)  and  93%  (unilateral  and  retroactive  changes  to  contracts)  that  the 
practices were UTPs. When asked about how frequently UTPs occurred in the food supply chain 87% 
stated they occurred regularly or very regularly. All respondents agreed that they occurred regularly or 
very  regularly  except  for  the  retail  sector,  which  stated  these  never  or  rarely  occurred  (84).  88%  of 
individuals stated UTPs occurred regularly or very regularly. 

The respondents were asked to identify which 3 practices they considered to be UTPs and to have the 
most  serious  impact.  Of  the  top  8  practices  identified,  six  are  listed  in  the  Supply  Chain  Initiative’s 
(SCI) Principles of Good Practice and seven as UTPs in the Agricultural Markets Task Force (AMTF) 
report (‘payment periods longer than 30 days’ appearing twice, for perishable and agro-food products 
in general). 

Where figures do not add up to 100% this is due to the omission of those stating ‘no opinion’. There was dependency between 

4 
some questions (only some respondents will have seen some questions, as these were only relevant depending on an answer previously 
given). This is relevant in particular for the retail sector, which meant for several questions the retail response rate is very low (3 or 4 
responses over 25 retail organisations). Replies were not compulsory, and some respondents chose not to reply to some questions. 
5 

Percentages based on number of respondents answering each question. 

3 

 
 
                                                            
 
Frequency 

SCI's 
Principles 
of Good 
Practice 

AMTF-
listed 
UTPs 

Unilateral  and  retroactive  changes  to  contracts  (concerning 
volumes, quality standards, prices) 

Last minute order cancellations concerning perishable products 

Payment periods longer than 30 days for perishable products 
Payment periods longer than 30 days for agro-food products in 
general 
Imposing contributions to promotional or marketing costs 

Unilateral  termination  of  a  commercial  relationship  without 
objectively justified reasons 
Requests  for  upfront  payments  to  secure  or  retain  contracts 
("hello money") 

Imposing claims for wasted or unsold products 

Imposing  private  standards  relating  to  food  safety,  hygiene, 
food  labelling  and/or  marketing  standards,  including  strict 
verification procedures 
Imposing  an  upfront  access  fee  for  selling  a  product  ("listing 
fees") 
Programmed overproduction leading to food waste 
Withholding  by  one  party  of  essential  information  to  both 
parties 
Passing onto other parties of confidential information  received 
from partner 
Additional  payment  to  have  products  displayed  favourably  on 
shelves ("shelf-space pricing") 
Imposing  on  a  contract  party  the  purchase  of  an  unrelated 
product ("tying") 
Inconsistent application of marketing standards leading to food 
waste 
Imposing to suppliers costs related to product shrinkage or theft 

Imposing a minimum remaining shelf life of goods at the time 
of purchase 
Other 

771 

316 

275 

273 

248 

227 

185 

182 

179 

152 

146 

114 

98 

90 

78 

60 

40 

11 

83 

* 

* 
* 

* 

* 

* 

* 

* 

* 

* 

* 

* 

* 

* 

* 

* 

* 

The questionnaire requested respondents to identify the actors in the food supply chain on which UTPs 
might  have  appreciable  negative  effects.  94%  of  respondents  agreed  or  partially  agreed  that  such 
appreciably negative effects occurred for farmers. 83% of respondents for processors; 66% for SMEs; 
60% for consumers; 55% for third country operators producing for the EU market; 39% for traders; 
and  35%  for  retailers.  Respondents  were  also  asked  whether  they  agreed  that  UTPs  could  have 
negative indirect effects on these groups, with broadly similar results. 

4 

 
 
 
 
 
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
 
 
b)  Need to act 

When  asked  whether  action  should  be  taken  to  address  UTPs  in  the  food  supply  chain  95%  of 
respondents agreed or partially agreed. If they thought action should be taken, respondents were then 
asked to specify who should take such action.  

- 87% believed action should be taken by the European Union (in combination with Member States, 
58% ; or the EU acting alone, 29%);  

- 8% that MSs should act alone; and  

- 4% that action should be taken through voluntary initiatives (54% of these were retail organisations). 

Of the 87% of respondents that believed that the EU should take action, 51% thought legislation was 
the appropriate means, 46% a mix of legislation and non-legislation, and 2% preferred non-legislative 
action.97% of these respondents believed EU action would result in better enforcement of rules; 95% 
believed  EU  action  would  provide  more  legal  certainty  for  businesses;  94%  that  it  would  level  the 
playing  field  in  the  internal  market;  84%  that  it  would  benefit  EU  cross-border  transactions;  84% 
believed it would reduce food waste; 80% that it would lead to a higher degree of innovation; and 75% 
that it would widen the choice offered to consumers. 67% preferred both a harmonised definition and a 
list of specific UTPs; 21% a list of specific UTPs; 11% general principles; and 1% none of these. 

Finally respondents were asked for their views on whether the voluntary Supply Chain Initiative was 
sufficient to address UTPs. 75% disagreed or partially disagreed, and 22% agreed or partially agreed. 
All organisation types primarily disagreed or partially disagreed, except for retail organisations( 88% 
agreed  or  partially  agreed  Supply  Chain  Initiative  was  sufficient.  Agro-food  and  trade  organisations 
had relatively high rates for ‘agreed or partially agree’, even if this was not overall the preferred option 
(43%  and  40%,  respectively).  81%  of  individuals  involved  in  farming  and  69%  of  other  individuals 
disagreed or partially disagreed. 

c)  Enforcement 

92% of respondents agreed or partially agreed that there should be minimum standards applying to the 
enforcement of UTP rules in the EU. Support for minimum enforcement standards ranged from 20% 
of retail organisations to 100% for civil society organisations (96% of agriculture organisations; 87% 
of agro-food organisations agreed or partially agreed). 

Respondents were then asked which elements they considered to form an important part of an effective 
public  enforcement  of  UTP  rules.  94%  stated  transparency  of  investigations  and  results;  93%  the 
possibility  of  fines  in  the  case  of  violations  to  the  rules;  92%  the  possibility  to  file  collective 
complaints; 89% the ability to receive and to treat confidential complaints; 89% the designation of a 
competent authority; 73% the ability to conduct own initiative investigations; and 36% other aspects. 
The various organisation types and individual respondents mostly agreed or partially agreed with these 
elements,  with  the  exception  of  retail  (disagreed  or  partially  disagreed  with  each  of  the  elements 
between 72% to 80%). 

5 

 
 
2.3. Targeted questionnaire to undertakings 

The  targeted  questionnaire  to  undertakings  was  open  between  6  November  and  10  December  and  a 
total  of  122  responses  were  received.  35%  of  respondents  were  involved  in  agriculture,  48%  in 
processing, 10% in retail, 4% in wholesale (remaining answers not classified). In terms of size, 70% of 
respondents were SMEs. 7% of the respondents classified themselves as buyers, 49% suppliers, 40% 
as acting as both supplier and buyer. A high share of replies is from Belgium, France, Italy, Spain and 
the United Kingdom (18 Member States have 3 or less replies). 

54% of the enterprises acting as buyers and 89% of suppliers state that late payments occur in business 
transactions.  14%  to  30%  of  those  acting  as  buyers  stated  that  they  have  imposed  other  UTPs  in  a 
business transaction. For enterprises acting as suppliers 44% to 82% stated that they have been subject 
to an UTP as defined above.   

30%  of  the  enterprises  acting  as  suppliers  have  been  refused  a  contract  in  writing  upon  request. 
Suppliers were asked to estimate if they have been a victim to a UTP when buyers were established in 
other Member State. 24% of the respondents stated that they were "often or in a significant number of 
cases"  in  such  situations.  19%  of  suppliers  stated  that  dealing  with  a  foreign  buyer  had  a  negative 
effect on their ability to challenge UTPs. 

60% of the suppliers stated that UTP costs are more than 0.5% of the annual turnover of their business 
operation.  Under  certain  assumptions  in  terms  of  weight  for  each  category  of  answer6,  the weighted 
commercial significance of costs related to UTP can be estimated at 1.8% (taking into account the 94 
answers of suppliers) to 1.5% (trimming  out the extreme  answers  – no costs, cost over 5%) of their 
turnover. 44% of buyers considered compliance costs as "high or moderate". 

2.4. Targeted questionnaire to consumer organisations 

The consultation of consumer organisations resulted in three contributions. This consultation focused 
on whether and how UTPs in the food supply chain would affect consumers, according to their 
representative organisations.  

Respondents disagreed that the introduction of legislation on UTPs would raise consumer prices and 
agreed that it would lead to an increase of trust in the food supply chain and benefit investment. Two 
agreed  that  the  conditions  for  those  employed  in  the  food  supply  chain  would  be  improved  (one  no 
opinion). All respondents agreed that the introduction of EU rules on UTPs would benefit consumers 
in the long term. Two agreed and one partially disagreed there would be benefits in the short term.  

One  respondent  agreed  that  the  introduction  of  UTP  rules  in  their  own  country  had  increased 
consumer  choice,  increased  trust,  improved  conditions  for  investment  for  operators,  improved 
conditions for those employed in the food supply chain, and disagreed that it raised consumer prices 
(the  other  two  respondents  had  no  opinion).  Two  respondents  disagreed  and  one  partially  disagreed 
that self-regulatory initiatives are sufficient. Two respondents disagreed and one agreed that possible 
negative effects on consumers from UTP legislation outweigh the potential benefits (at EU level). 

6 
(24 answers) = 0.25%; ‘nil or insignificant’ (16 answers) = 0%. 

Reference points set: ‘over 5%’ (14 answers) = 5%; ‘2 to 5%’ (18 answers) = 3.5%; ‘0.5 to 2%’ (22 answers) = 1.25%; ‘>0.5%’ 

6 

 
 
 
                                                            
 
2.5. Questionnaire to Member State public authorities 

Member  State  authorities were  consulted  via  a  set of  questionnaires  that  requested  contributions  on: 
actual  and/or  estimated  administrative  costs  of  enforcing  new  UTP  legislation  under  certain 
conditions;  an  update  of  information  previously  provided  (2015)  on  the  status  of  UTP  rules  in  their 
national jurisdictions, including enforcement aspects; and to obtain information on impact assessments 
and other studies that Member States had available in this area. These data were used to inform a study 
by  external  experts  and  directly  in  the  present  impact  assessment  report  (see  Annex  1).  The 
questionnaire to Member States was officially open between 2 October 2017 and 3 November 2017, 
but late submissions were accepted for use in the study by the external experts. 

2.6. Joint Research Centre academic workshop on UTPs in the food supply chain 

A workshop jointly organised by the Directorate-General for Agriculture and Rural Development and 
the  Joint  Research  Centre  (JRC)  was  held  in  Brussels  on  17-18  July  2017.  The  workshop  brought 
together international experts, with a view to discuss the scientific literature on methodology, impacts 
and  regulatory  aspects  of  UTPs.  A  report  compiled  by  several  experts  and  edited  by  the  JRC  is 
publically available (further details of the outcomes of the workshop in Annex 1)7. 

2.7. Ad hoc meetings with food supply chain stakeholders 

Several bilateral meetings with stakeholders were organised at their request. Meetings were held with 
Independent Retail Europe, FoodDrinkEurope, EuroCommerce, European Brands Association (AIM), 
the  Danish  Chamber  of  Commerce,  the  German  Retail  Federation,  the  Liaison  Centre  for  the  Meat 
Processing Industry in the European Union (CLITRAVI), the European Livestock and Meat Trading 
Union (UECBV), Edeka, REWE, Federation du Commerce et de la Distribution, the European Dairy 
Association,  the  International  Dairy  Federation,  the  United  Kingdom’s  National  Federation  of  Meat 
and  Food  Traders,  Europatat,  and  Euro  Fresh  Foods.  The  bilateral  meetings  focused  on  answering 
stakeholder  questions  about  the  impact  assessment  process  and  content,  for  stakeholders  to  express 
support for or opposition to the initiative and raise issues of relevance to their sector. 

2.8. Civil Society Dialogue groups 

Two presentations with an exchange of views were made at Common Agricultural Policy Civil 
Dialogue Groups (CDGs), where several stakeholder groups are represented8. These took place on 6 
November 2017 (Olives CDG) and 22 November 2017 (Horticulture/Fruit and Vegetables CDG). 

7 
8 

Joint Research Centre report, Unfair trading practices in the food supply chain, 2017. 
Common Agricultural Policy Civil Dialogue Groups. 

7