REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL The application of the Union competition rules to the agricultural sector
Date: 2018-10-26
Institutions: Directorate-General for Competition, European Commission
Subjects: agricultural production, application of EU law, common organisation of markets, control of restrictive practices, farming sector, inter-company agreement, producer organisation, restriction on competition, restrictive trade practice, single market

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 26.10.2018 COM(2018) 706 final  REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL The application of the Union competition rules to the agricultural sector {SWD(2018) 450 final}  
 
 
REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT 
AND THE COUNCIL 

The application of the Union competition rules to the agricultural sector 

1. 

INTRODUCTION 

1.  Under  Article  225(d)  of  Regulation  (EU)  No  1308/2013  ('CMO')1  the  Commission 
shall  present  to  the  European  Parliament  and  the  Council,  by  31  December  2017,  
a  report  on  the  application  of  the  competition  rules  to  the  agricultural  sector,  
in particular on the operation of Articles 209, 210 and 169, 170 and 171 CMO. 

2.  This report is based on input from national competition authorities ('NCAs'), Member 
States  and  private  organisations  to  the  Commission,  studies  of  the  European 
Commission on producer organisations in the olive oil, arable crops and beef &veal 
sector (2017) and on interbranch organisations (2016). 

3.  'Agricultural sector' covers the products listed in Article 1 (2) and Annex I CMO.  

4.  The report covers the period from 1 January 2014 to mid-2017, as far as derogations 
from  the  competition  rules  in  the  CMO  are  concerned  and  from  1  January  2012  to 
('the  Period').2  
mid-2017 
The  Commission  Staff  Working  document  provides  additional  information  on  the 
derogations and the antitrust investigations. 

the  description  of  antitrust 

investigations 

for 

1.1.  The Union competition rules 

5.  Article 101 Treaty on the Functioning of the European Union (TFEU) prohibits 
agreements  between  two  or  more  independent  market  operators  which  restrict 
competition.  These  cover  in  particular  price  fixing  arrangements,  which  remove 
incentives to improve production and are serious infringements. Under Article 101(3) 
TFEU  agreements  are  exempted  from  the  prohibition  in  Article  101(1)  if  they 
generate  objective  economic  benefits  that  outweigh  the  negative  effects  of  
a  restriction  of  competition,  e.g.  by  contributing  to  improving  the  production  or 
distribution of goods, while allowing consumers a fair share of the resulting benefit. 
The  restriction  must  also  be  indispensable  and  competition  must  not  be  eliminated. 
Operators  assess  themselves  whether  the  conditions  of  Article  101  TFEU  are 
fulfilled.3  

1  Regulation  (EU)  1308/2013  of  the  European  Parliament  and  of  the  Council  of  17  December  2013 
establishing a common organisation of the markets in agriculture, OJ L 347 of 20.12.2013, p. 671. 
2  For the period 2004-2011 see report on competition law enforcement and market monitoring activities 

by the European competition authorities in the food sector.  

3  For  guidance,  European  Commission’s  2004  guidelines  on  the  application  of  Article  81(3)  EC  

(now Article 101 (3) TFEU). 

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6.  The agricultural  sector  can also  benefit from exemptions  under  general  competition 
rules,  e.g.  the  so-called  Specialisation  Block  Exemption  Regulation  (SBER).4  
If parties produce or process products jointly and the parties' combined market shares 
do  not  exceed  20%  of 
the  processed  products,  
the  relevant  market  for 
the SBER allows joint sales of such products. This is relevant e.g. for  cooperatives, 
which often engage in processing activities.  

7.  Article 102 TFEU prohibits firms holding a dominant position on a given market to 

abuse that position, e.g. by charging unfair prices or by limiting output.  

1.2.  The application of the EU competition rules to the agricultural sector 

8.  The TFEU grants a special status to the agricultural sector. Under Article 42 TFEU, 
the Union competition rules apply to production of and trade in agricultural products 
only to the extent determined by the European Parliament and the Council, within the 
framework  of  Article  43(2)  TFEU  and  taking  into  account  the  five  objectives  of 
Article 39 TFEU. The objectives are increasing productivity, achieving a fair living 
standard of the agricultural community, market stabilisation, assuring availability of 
supplies  and  ensuring  reasonable  consumer  prices.  The  European  Court  of  Justice 
recognises  the  precedence  of  the  common  agricultural  policy  over  the  objectives  of 
the  Treaty  in  the  field  of  competition.5  It  acknowledges  that  the  maintenance  of 
effective competition is one of the objectives of the common agricultural policy and 
common organisation of markets.6 

2.  DEROGATIONS FROM ARTICLE 101(1) TFEU 

9.  The  Union  competition  rules  apply  to  the  production  of  and  trade  in  agricultural 
products,  unless  the  CMO  states  otherwise  (Article  206  CMO).  The  CMO  contains 
derogations  from  the  application  of  Article  101  TFEU,  which  either  apply  to  all  or 
some agricultural sectors or deal with specific situations.  

10. The  below  graph  describes  the  framework  of  competition  rules  and  derogations 

before 1 January 2018. 7  

4  Commission  Regulation  1218/2010  of  14.12.2010  on  the  application  of  Article  101  (3)  TFEU  to 

5 

6 

certain categories of specialisation agreements, OJ L 335/43 of 18.12.2010. 
Judgment  of  29  October  1980,  Maizena,  139/79,  EU:C:1980:250,  paragraph  23,  Judgment  of  5 
October  1994,  Germany  v.  Council,  C-280/93,  EU:C:1994:  367,  paragraph  61,  Judgement  of  19 
September  2013,  Panellionios  Szdesmos  Viomichanion  Metapoiisis  Paknou,  C-373/11,  EU:  C:  201: 
567, paragraph 39, and most recently recalled in Judgment of 14 November 2017,  APVE and Others,  
C‑671/15,EU:C:2017:860,  paragraph 37. 
Judgement  of  9  September  2003,  Milk  Marque  and  National  Farmers'  Union,  C-137/00, 
ECLI:EU:C:2003:429,  paragraph  57,  Judgment  of  14  November  2017,  APVE  and  Others,  
C‑671/15,EU:C:2017:860, paragraph 37 and 48. 

7  Regulation  (EU)  2017/2393  of  the  European  Parliament  and  of  the  Council  of  13  December  2017 
amending  Regulations  (EU)  No  1305/2013  on  support  for  rural  development  by  the  European 
Agricultural  Fund  for  Rural  Development  (EAFRD),  (EU)  No  1306/2013  on  the  financing, 
management and monitoring of the common agricultural policy, (EU) No 1307/2013 establishing rules 
for  direct  payments  to  farmers  under  support  schemes  within  the  framework  of  the  common 
agricultural  policy,  (EU)  No  1308/2013  establishing  a  common  organisation  of  the  markets  in 

2 

 
 
 
 
 
 
                                                 
Graph 1 
Competition rules before 01.01.2018 

11. Many  of  these  derogations  apply  to  the  work  of  recognised  producer  organisations 
(PO), whose activities are described in Article 152 CMO; others apply to farmers and 
farmers'  associations  (Article  209)  and  Article  210  CMO  applies  to  vertical 
cooperation in the supply chain by recognised interbranch organisations.  

12. As regards specifically the fruit &vegetables sector, concerning the activities of a PO 
Article  160  CMO  requires  producer  members  to  market  their  entire  production 
concerned  through  the  PO.  Under  Article  11  of  Commission  Delegated  Regulation 
(EU) 2017/8918, the main activity of POs in the fruit &vegetables sector relates to the 
concentration  of  supply  and  the  placing  on  the  market  of  the  products  of  their 
members. In a recent case concerning fruit & vegetables POs, the European Court of 
Justice stated that, subject to conditions, Article 101 TFEU may not apply to certain 
activities  (e.g.  planning  of  volumes,  adoption  of  a  pricing  policy)  of  such  POs.9 
Annual reports of Member States show that POs/ APOs marketed around 50% of the 
total fruit & vegetables output in the EU in 2015.  

agricultural  products  and  (EU)  No  652/2014  laying  down  provisions  for  the  management  of 
expenditure relating to the food chain, animal health and animal welfare, and relating to plant health 
and 
material  
(OJ 2017 L350, p. 15) "Omnibus Regulation" amended 152 CMO to contain an explicit competition 
derogation for PO/APOs in all sectors. 

reproductive 

plant 

8  OJ L 138 of 25.5.2017, p.4. 
9  See paragraph 15 below. 

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13. The  recognition  of  POs  and  APOs  is  granted  by  the  Member  States.  Currently,  
there  are  more  than  1700  recognised  POs  and  60  APOs  in  the  EU  in  the  fruit 
&vegetables sector.  This  is  due to  EU co-financing for the operational  programmes 
being allocated to recognised POs. In the milk sector there are about 300 recognised 
POs and 7 APOs. There are around 1200 recognised POs and nine APOs in the other 
sectors, mainly for meat, olive oil and cereals. 10  

14. While  this  report  is  limited  to  the  period  mentioned  in  paragraph  4,  two  recent 

developments should be mentioned.  

15. Firstly,  the  European  Court  of  Justice  decided  in  the  Endives  judgment11  that 
practices such as coordination of volume and pricing policies as well as exchanges of 
commercially  sensitive  information  between  producer  organisations  (POs)  and  their 
associations  (APOs)  are  prohibited  under  Article  101  TFEU.  The  Court  also  found 
that,  under  certain  conditions,  Article  101  TFEU  may  not  apply  within  recognised 
POs and associations of producer organisations (APOs) to such activities carried out 
by a  given PO/APO. The practices at  hand must in  particular be  strictly necessary 
for and proportionate to carrying out the objectives assigned to the PO/APOs by EU 
legislation.  

16. Secondly,  as  of  1  January  2018,  Article  152  CMO,  as  amended  by  the  Omnibus 
Regulation,  provides  for  a  derogation  from  Article  101  TFEU  for  recognised 
POs/APOs.  To  rely  on  the  derogation,  the  PO/APO  must  integrate  at  least  one 
activity  of  the  producer  members  (e.g.  transport,  storage),  genuinely  exercise  the 
activity, concentrate supply and place products of their members on the market.  

2.1.  General competition derogations in the CMO 

2.1.1.  Article 209 CMO 

17. Article  209  (1)  2nd  paragraph  CMO,  which  has  existed  with  similar  wording  since 
1962,  is  a  general  derogation  from  Article  101  (1)  TFEU  for  farmers  working 
together. The agreements shall not (i) jeopardise the objectives of Article 39 TFEU, 
(ii)  entail  an  obligation  to  charge  an  identical  price  and  (iii)  exclude  competition.  
As  farmers  assess  the  applicability  of  the  derogation  to  the  agreement  themselves 
without  informing  the  Members  States  or  the  Commission,  the  Commission  has  no 
data  on  how  often  farmers  relied  on  this  derogation.  In  competition  investigations, 
parties rarely referred to Article 209 CMO.  

18. The  competition  authority  in  the  Netherlands  dealt  with  the  predecessor  article  to 
Article  209  CMO  –  Article  176  of  Regulation  1234/2007  -  in  two  investigations.  
In one of these, in 2012, the National Competition Authority ("NCA") fined a group 

10  Data for 2016, The data is based on Member State reporting for the fruit and vegetables sector and for 
the milk sector. For the other sectors, data are preliminary figures based on Member States' answers to 
Commission's request of April 2017.  

11  Judgment  of  14  November  2017,  APVE  and  Others,  C‑671/15,EU:C:2017:860,    paragraph  43  seq.  

The case concerned provisions of Regulation (EU) 1234/2007. 

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of  agricultural  producers,  wholesalers  and  processors  for  an  agreement  that  limited 
the  production  of  silver-skin  onions.  The  parties to  the  agreement  also  shared  price 
information  in  order  to  align  prices  and  obtain  the  highest  possible  price  level.  
In order to support the agreement they bought several competing onion producers that 
after the acquisition would no longer produce silver-skin onions. The parties argued 
that  the  agreement  could  be  covered  by  the  derogation,  because  it  was  needed  to 
increase the productivity and yield of the production as well as to obtain reasonable 
prices.  The NCA found that the derogation did not apply since 1) the parties were not 
part of a national  market organisation, 2) the  yearly output quotas were intended to 
raise  prices  above  the  competitive  level  and  the  agreement  did  not  contribute  to 
ensuring  that  supplies  reach  consumers  at  reasonable  prices  and  3)  the  agreements 
entailed charging identical prices.  

2.1.2.  Article 210 CMO – Agreements by Interbranch Organisations (IBO)  

19. Under  Article  210  CMO,  recognised  IBOs  can  rely  on  a  derogation  from  Article 
101(1)  TFEU.  They  must  notify  their  agreements  to  the  Commission  and  if  the 
Commission does not find them incompatible with Union rules within 2 months after 
having received full notification, Article 101(1) TFEU does not apply. The agreement 
may  not  entail  price  or  quota  fixing  or  lead  to  market  partitioning  or  create  other 
competition distortions.  The Commission has received two notifications from IBOs 
under this article.  

20. In  January  2015,  the  Commission  did  not  object  to  an  agreement  of  the  Centre 
National Interprofessionnel de l'Economie Laitière (CNIEL) which established price 
grids  for  certain  milk  characteristics.  As  the  milk  price  depends  on  its  composition 
and quality, the regional organisations of CNIEL publish values for various technical 
milk specifications based on different parameters of milk (e.g. fat content, origin of 
the  milk  based  on  type  of  cattle,  criteria  for  health  and  hygiene)  which  lead  to 
bonuses or penalties in relation to the base price. Milk farmers and buyers may on a 
voluntary basis refer in their contracts to the published grids to agree on a premium or 
penalty in relation to the basic milk price.  

21. In  June  2017,  the  Commission  did  not  object  to  the  agreement  of  the  French 
interbranch  organisation  Comité  national  interprofessionnel  de  la  pomme  de  terre 
(CNIPT)  establishing  a  price  indicator  for  potatoes.  The  price  indicator  is  based  on 
aggregated data of how farmers in the past have been remunerated for certain potato 
varieties. Publishing this information aims at increasing the knowledge of the supply 
chain. Potato farmers and buyers may on a voluntary basis refer to the published price 
indicator in their individual contracts. 

22. There  are  currently  128  recognised  interbranch  organisations  in  nine  Member 
States  of  the  European  Union,  with  the  vast  majority  of  these  IBOs  in  France  and 

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Spain (65, respectively 27 IBO). Most of the interbranch organisations operate in the 
wine and fruit and vegetables sector.12 

2.2. 

Sector specific derogations in the CMO 

2.2.1.  Contractual negotiations   

23. During  the  period  covered  by  this  report,  in  four  sectors  -  olive  oil,  beef/veal  and 
certain arable crops and milk and milk products - the CMO provided the possibility 
for the POs to negotiate supply contracts for the sale of the respective products of their 
members. The measures had in common the strengthening the bargaining position of 
farmers  in  relation  to  their  downstream  partners,  but  the  conditions  and  activities 
authorised under these provisions differ.  

24. Since 2012, under Article 149 CMO in the  milk sector, recognised POs, subject  to 
quantitative  limitations,  can  engage  in  contractual  negotiations  without  being 
required to concentrate supply and place products of their members on the market or 
to  integrate  an efficiency  enhancing activity of their producers. A PO can negotiate  
a  price  for  the  delivery  of  raw  milk  to  processors.  The  implementation  of  this 
provision  was  described  in  Commission  reports  of  2014  and  2016.13  Nine  Member 
States reported deliveries of raw milk in 2016 under contracts collectively negotiated. 
The volume collectively negotiated amounted to 22.8 million tonnes, corresponding 
to 15% of total milk deliveries in the EU in 2016.  The sector specific derogation for 
milk in Article 149 CMO is still applicable.  

25. Since  2014,  Articles  169,  170  and  171  CMO  allowed  joint  sales  and  sales-related 
activities  of  agricultural  products  in  the  sectors  of  olive  oil,  beef  and  veal,  and 
arable  crops  by  producers  through  recognised  POs.  Subject  to  quantitative 
limitations,  the  PO  may  negotiate  supply  contracts,  provided  that  it  concentrates 
supply  and  places  the  products  of  its  members  on  the  market.  It  further  needs  to 
integrate  at  least  one  activity  of  its  producer  members,  which  should  be  likely  to 
generate significant efficiencies. In 2015, the Commission adopted Guidelines on the 
application of these provisions.14 The provisions have been repealed as of 1 January 
2018  by  Regulation  (EU)  2017/2393.  While  the  derogations  concerning  olive  oil, 
beef/veal  and  certain  arable  crops  have  been  repealed,  they  continue  legally  to  be 
relevant for those activities, which took place before the amendments of the Omnibus 
Regulation entered into force on 1 January 2018.   

26. In order to benefit from  the derogation for these three sectors, the PO must provide 
the competent authority of its Member State with the volume of the product covered 
by the negotiations. The Member State must inform the Commission. Since the entry 
into force of the CMO, the Commission has not received any such notifications. 

12  Annual reports by Member States and Arcadia/LEI Wageningen study.  
13  https://ec.europa.eu/agriculture/milk/milk-package_en. 
14  Commissions Notice, OJ C 431 of 22.12.2015, p. 1. 

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27. In  2017  the  Commission  launched  a  study  on  Producer  Organisations  and  their 
activities  in  the  three  sectors.  The  results  show  that  there  are  many  more  
non-recognised  POs/APOs  than  recognised  POs/APOs.  The  total  number  of 
recognised and non-recognised POs and APOs is around 1 400 entities in the olive oil 
sector; around 800 in the beef and veal sector and around 1 600 in the arable crops 
sector. 

28. The  results  also  show  that  about  two-third  of  POs  and  APOs  carry  out  contractual 
negotiations and, that virtually all those POs and APOs who do so also carry out at 
least  one  of  the  efficiency-enhancing  activities  required  by  Articles  169-171  of  
the CMO Regulation, the most common efficiency-enhancing activities being quality 
control,  distribution/transport  and  procurement  of  inputs.  POs  carry  out  these 
efficiency-enhancing  activities  first  and  foremost  because  they  consider  that  these 
activities improve their position in negotiations with buyers. No PO has fulfilled all 
administrative  requirements  (recognition  and  notification  of  volumes  negotiated)  
to benefit from the derogation. 

2.2.2.  Other sector derogations, including crisis measures 

29. Articles  150  and  172  CMO  allow  POs  to  agree  to  adapt  supply  to  demand  and 
ensure  value  added  and  quality  of  certain  products.  For  the  supply  of  PDO/PGI 
cheeses15,  France  has  applied  supply  management  for  eight  and  Italy  for  four 
cheeses under application of Article 150 CMO. A similar possibility for the supply of 
PDO/PGI  ham  has  so  far  only  been  used  by  Italy,  Article  172  CMO.  For  wine, 
France (17 cases) and Spain (1 case) notified the Commission of having laid down 
marketing rules for supply regulation in accordance with Article 167 CMO. 

30. In  the  sugar  sector,  Commission  Delegated  Regulation  (EU)  2016/116616  allows 
sugar processors and sugar beet growers to agree to share value and losses between 
them, subject  to  certain  conditions.  The value sharing  clause is  optional  and should 
only  be  agreed  between  one  sugar  processor  (i.e.  no  cooperation  of  several 
processors)  and  beet  growers  at  the  same  time.  Parties  cannot  fix  prices  for  beet.  
The  value  sharing  is  widely  used,  i.e.  in  35  out  of  the  42  agreements  within  the 
trade17, for which the Commission obtained information.  

31. Article 33 CMO provides for the possibility of producer organisations in the fruit 
and  vegetables  sector  to  implement  various  measures  under  operational 
programmes, inter alia production planning and crisis measures. These measures 
are co-financed by the EU.  In 2015, the EU  financial assistance for crisis  measures 
accounted for EUR 50 million.  

15  PDO is 'Protected designation of origin' and PGI 'Protected geographical indications'. 
16  Commission  Delegated  Regulation  (EU)  2016/1166  of  17  May  2016  as  regards  purchase  terms  for 

beet in the sugar sector as from 1 October 2017. 

17  These  are  agreements  between  beet  growers  or  their  organisation  and  sugar  processors  or  their 

organisations to be concluded prior to an individual delivery contract, Article 125 CMO. 

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32.  In a situation of severe market imbalance, Article 222 CMO allows  agreements of 
recognised  POs/APOs  and IBOs in  all agricultural  sectors for  a limited period of 
six  months,  which  can  be  prolonged  once.  Such  crisis  measures  to  e.g.  withdraw 
products from the market have been authorised by the Commission during the milk 
crisis  from  April  2016  to  April  2017.  The  Commission  has  not  received  any 
information that this authorisation has been used. 

2.3.  Article 101(3) TFEU 

33.  Agreements reached between independent producers e.g. on quantities and sales can 
be exempted under Article 101(3) TFEU, if the conditions described in paragraph 5 
above are met. 

34.  In  2013  the  NCA  in  Latvia,  in  an  ex  officio  investigation,  assessed  a  joint 
processing agreement by two dairy cooperatives that included raw milk price fixing 
under  national  competition  law  (equivalent  to  Article  101  (3)  TFEU).  The  NCA 
found that the agreement could be exempted, as all the conditions were met.   

35.  In  2013,  the  NCA  in  France  initiated  an  investigation  based  on  a  complaint  and 
fined five pig slaughterers for agreeing on quantities of pork meat to be bought from 
farmers  producing  live  pigs.  The  aim  was  to  lower  the  prices  paid  to  farmers.  
The NCA also fined an association of slaughterers for sending price instructions to 
its  members.  Further,  seven  slaughterhouses,  an  association  of  slaughterers  and  
an  auction  market  buyer  federation  were  fined  for  collectively  agreeing  on  a  base 
price to be paid to farmers. Concerning the last infringement, the parties argued that 
their agreement could be exempted under Article 101(3) TFEU. The NCA concluded 
that  even  if  the  parties  could  demonstrate  that  fixing  a  base  price  contributed  to 
improving  the  meat  production,  the  other  conditions  were  not  fulfilled  because  
a fixed base price did not promote economic progress and the practice did not allow 
consumers to enjoy a fair share of any resulting benefit. 

3. 

INVESTIGATIONS BY COMPETITION AUTHORITIES IN THE AGRICULTURAL SECTOR 

36.  In the period from 1 January 2012 to mid-2017 ('the Period'), European competition 
authorities18 have concluded about 126 investigations with about 41 investigations 
still  ongoing,  leading  to  a  total  of  167  investigations.  The  highest  number  of 
investigations was carried out by the NCAs in Austria (24), Denmark (22), Greece 
(21) and by the European Commission (22).  

3.1.  Main product categories investigated 

37.  The  competition  authorities'  investigations  cover  a  wide  range  of  agricultural 
products,  but  the  following  product  categories  were  investigated  most  frequently: 

18 

'Competition  authorities'  covers  both  the  European  Commission  and  EU  national  competition 
authorities.    

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milk and dairy (34%), meat (19%), fruit and vegetables (12%) and cereals (10%). 
A  number  of  investigations  also  took  place  in  the  categories  of  oilseeds,  oils  and 
fats (5%), sugar (5%) and rice (2%). 

38.  The  infringements  detected  by  the  competition  authorities  which  resulted  in  
a  financial  penalty  concern  a  variety  of  agricultural  products,  including:  milk  and 
dairy  products  (26%),  fruit  and  vegetables  (22%),  meat  in  general  (16%), 
oilseeds, oil and fats (10%), others products, e.g. natural vinegar, wine, cereals, 
wine, cotton, sugar (26%).  

3.2.  Entities subject to investigations 

39.  The  entities  subject  to  investigations  conducted  by  competition  authorities  are:  
processors  (36%),  retailers  (15%),  other  types  of  associations  (11%), 
(9%),  agricultural  producer 
agricultural  producers, 
organisations  (9%),  general  associations  of  farmers  (9%),  others  (7%), 
associations of producer organisations (4%).  

(9%),  wholesalers 

40.  The  entities  subject 

to  decisions  where  competition  authorities  found  an 
infringement  of  competition  rules  are:  processors  (39%),  retailers  (26%), 
wholesalers  (12%),  other  types  of  associations  (7%),  agricultural  producers 
(5%),  agricultural  producers  organisations  (4%),  others  (4%),  associations  of 
producers organisations (3%). 

41.  Processors  are  the  entities  most  frequently  represented  in  the  investigations.  
For  example,  in  2014  the  NCA  in  Germany  fined  the  three  major  German  sugar 
processors  for  forming  a  'territorial  cartel'  which  meant  that  they  would  limit  their 
sales of sugar in Germany to their respective home sales areas. They also agreed on 
prices  and quantities  to  be sold.  The aim was to  obtain the highest  possible prices.  
In two other ex-officio cases for instance, in 2012 and 2013 the NCAs in France and 
Germany respectively fined 17 and 22 large flour mills for jointly agreeing on sales 
prices,  the  quantities  they  would  sell  and  which  customers  each  mill  would  limit 
their  sales  to.    In  another  example,  in  an  ex-officio  case  from  2012  the  NCA  in 
Greece fined the processors (private companies, cooperatives and an association of 
processors) of poultry meat for jointly i.a. fixing the selling prices of their products 
and preventing imports of chickens.  

3.3.  Main sources of investigations 

42.  As to the origins of the investigations, competition authorities opened the majority 
of  the  investigations  following  complaints  (from  suppliers,  competitors  or 
customers).  The  authorities  opened  other  proceedings  on  their  own  initiative  after 
becoming aware of potential anti-competitive practices through market information. 

3.4.  Types of complainants 

43.  The complainants are varied and essentially include: agricultural producers (23%), 
processors  (19%),  others  (15%),  agricultural  producer  organisations  (13%), 

9 

 
 
 
individual  persons  (7%),  wholesalers  (5%),  retailers  (5%),  other  types  of 
associations  (5%),  agricultural  associations  of  producer  organisations  (3%), 
local authorities (3%), general associations of farmers (2%).  

44.  This  shows  that  agricultural  producers  alone  or  in  a  partnership  are  the  most 
important source of complaints. Investigations only led to findings of infringements 
in  about  one  fourth  of  the  investigations  covered  by  this  report.  This  proportion  is 
lower  for  investigations  triggered  by  complaints  of  agricultural  producers:  out  of  
25 investigations opened in the Period following complaints lodged by agricultural 
producers,  only  4  investigations  led  to  the  adoption  of  a  decision  finding  
an  infringement.  Agricultural  producers  often  make  their  complaints  public  at  
the  time  they  submit  them  to  competition  authorities  and  thereby  undermine  
the chances that the authorities can collect evidence of possible infringements.   

45.  Competition  authorities  have  nevertheless  identified  several  practices  that  were 
directly detrimental to farmers. For example, on the basis of a complaint the NCA in 
Spain fined buyers who agreed to pay lower prices to farmers for raw milk and who 
allocated  farmers  between  themselves.  In  another  example,  on  the  basis  of  
a complaint, the NCA in France fined buyers of live pigs because they had agreed 
on  the  quantities  they  planned  to  purchase  from  farmers  with  a  view  to  reducing  
the price for the animals. NCAs for instance also intervened to relax the exclusivity 
conditions  imposed  by  dominant  cooperatives  on  farmers.  In  those  cases, 
competition  authorities  enabled  farmers  to  supply  several  processing  cooperatives 
with raw milk (in Sweden) and sugar beet (in France), thereby widening options for 
producers  to  obtain  higher  prices  and  allowing  them  to  increase  their  output  
(for example for sugar beets at the time of removal of quotas). 

3.5.  Outcomes of investigations 

46.  The  antitrust  investigations  in  the  agricultural  sector  that  were  closed  during  the 

Period led to four different types of outcomes:  

a.  infringement  decisions  with  fines,  i.e.  the  competition  authorities 
required an entity to stop the infringement and to pay a pecuniary penalty 
(about half of the concluded cases);  

b.  infringement  decisions  without  fines,  i.e.  the  competition  authorities 
required  an  entity  to  stop  the  infringement  without  a  pecuniary  penalty  
(a few of the concluded cases);  

c.  commitment  decisions,  i.e.  the  competition  authorities  did  not  decide 
whether there was an infringement and adopted a decision that makes the 
commitment  offered  by  the  entity  under  investigation  legally  binding, 
thereby removing any potential concerns (a few of the concluded cases) ; 
d.  closures  without  decision,  i.e.  closure  of  the  proceedings  by  the 
competition  authorities  during  a  preliminary  phase  of  the  investigation 
due  to  lack  of  evidence  (among  these  investigations  the  rejections  of 
complaints  must  be  taken  into  account),  because  disproportionate  efforts 

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were  necessary  to  meet  the  requisite  burden  of  proof  or  because  of  the 
need to set priorities (about half of the concluded cases).  

3.6.  Types of infringements investigated 

Figure 1 
Numbers  of  main  types  of  infringements  investigated  in  the  Period  01/2012-
06/201719 

47.  European  competition  authorities  have  investigated  vertical  agreements  (38%  of 
investigations in the Period), i.e. agreements between entities operating on different 
levels  of  the  production.  For  example,  NCAs  investigated  agreements  between 
processors and  retailers  establishing  a minimum  retail  price  e.g. in  in  Slovakia for 
one  case  concerning  dairy  products  and  in  Bulgaria  for  three  cases  concerning 
sunflower  oil.  The  NCA  in  Austria  concluded  23  investigations  into  agreements 
between processors and retailers on minimum retail prices on dairy, meat and flour 
that  an 
products.  In  some  other  cases,  competition  authorities  concluded 
infringement  was  unlikely  and  therefore  closed  the  investigation.  For  example,  
the NCA in  Croatia  initiated an investigation based on  a complaint  concerning an 
agreement  between  the  representatives  of  the  milk  producers  and  milk  processors, 
concerning  the  calculation  of  the  purchase  price  of  milk.  The  NCA  found  that  the 
negotiations  and  arrangements  for  milk  purchase  prices  were  not  considered 
problematic under competition rules. 

19  The total number of investigations conducted by the competition authorities and the number of main 
type of infringements detected do not match because some investigations cover more than one type of 
infringement (for instance a vertical and horizontal agreement).   

11 

 
 
 
 
 
 
 
                                                 
48.  European  competition  authorities  have 

investigated  horizontal  agreements,  
i.e.  agreements  between  two  or  more  actual  or  potential  competitors  (38%),  
e.g.  agreements  between  producers  fixing  the  price  of  an  agricultural  product.  
For  example,  in  an  ex-officio  investigation,  the  NCA  in  Cyprus  found  that  
an agricultural association of producer organisations  infringed competition rules by 
concluding with its farmers, members of the association, distribution agreements for 
raw cow milk which included specific terms for determining the price of raw milk. 
In other cases, competition authorities concluded that an infringement was unlikely 
and therefore  closed the investigation.  For example, the NCA in  Poland closed its 
investigation  into  a  complaint  due  to  lack  of  evidence  that  simultaneous  and 
relatively  fast  price  changes  (namely  reduction)  of  industrial  apples  purchased  by 
processors resulted from a price-fixing agreement.  

49.  Competition  authorities  have  also  investigated  agreements  that  were  both  vertical 
and  horizontal  because  they  involved  several  levels  of  the  supply  chain  and  they 
involved  at  each  level  several,  if  not  all,  competitors.  For  example,  in  2015  
the  European  Commission  ex  officio  looked  into  agreements  that  national 
associations of agricultural producers publicly reported to have reached with national 
associations  of  processors  and  national  associations  of  retailers  in  France.  
The  agreements  aimed  at  raising  prices  of  some  dairy  and  meat  products  and 
excluding  supplies  of  producers  from  other  Member  States  by  committing  the 
retailers  to  source  100%  of  the  relevant  products  in  France.    The  Commission 
intervention ensured that French supermarket  shelves  were not  reserved for French 
products,  thus  preventing  a  damaging  cycle  of  retaliations  for  all  farmers  in  the 
Internal Market and the cases have been closed. Several NCAs investigated similar 
agreements. 

50.  Competition  authorities  have  further  investigated  potential  abusive  conduct  by 
dominant  operators  (24%).  These  abuses  mainly  involved  strategies  to  foreclose 
competitors,  such  as  exclusivity  obligations,  minimum  purchasing  obligations, 
refusals  to  supply and so-called exploitative abuses,  such as unjustified  contractual 
obligations. In some cases, NCAs have found that dominant companies abused their 
dominant  positions,  for  instance  by  refusing  to  supply  their  products  to  certain 
customers.  In  one  example,  in  2012,  based  on  a  complaint  the  NCA  in  Finland 
proposed a fine on a dairy cooperative for abusing its dominant position by selling 
fresh  milk  at  artificially  low  prices.  The  NCA  found  that  the  cooperative's 
motivation  for  low  prices  was  to  evict  all  other  processors  from  the  market, 
including  small  dairies,  so  the  dominant  processor  would  become  the  only  milk 
processor in the market - allowing it then to raise the prices again.  

51.  All  cases  of  abusive  conduct  by  dominant  operators  detected  by  competition 

authorities concern the milk and dairy sector.  

12 

 
 
 
 
 
 
52.  Sometimes, the cases were closed due to lack of evidence. For example, the NCA in 
Sweden closed an investigation due to lack of evidence concerning a complaint that 
a dominant company was paying retailers not to sell the products of competitors.  

3.7.  Types of infringements found 

53.  The types  of infringement  detected by the competition authorities can be classified 
as  follows:  agreements  on  price  (46%),  agreements  on  output  (13%), 
information exchange on output, market shares and customers (13%),  market 
sharing  agreement  (10%),  information  exchange  on  price  (10%),  abuses  of 
dominant position, involving strategies to foreclose competitors, such as predatory 
prices, exclusionary rebates, excessive and unfair prices (8%). In a number of cases, 
the competition authorities found that there were several infringements at the same 
time.  

types  of 

Figure 2 
Main 
the Period  
01/2012-06/2017 

infringements  detected  by  competition  authorities 

in  

3.8.  Consultations and monitoring activities 

54.  Further,  competition  authorities  provide  advice  on  the  application  of  competition 
rules.  In  the  Period,  NCAs  have  received  46  such  consultations  for  advice  in  
the  agricultural  sector.  Consultation  requests  come  from  operators,  but  also  from 
authorities e.g. on the subject of new legislation.  

13 

 
 
 
 
 
         
 
55.  An important work of the NCAs also consists in monitoring activities.  In the Period, 
NCAs  have  conducted  53  monitoring  and  related  activities  concerning  the 
application  of  competition  rules  to  the  agricultural  sector.  Such  work  typically 
includes sector investigations, adoption of reports and advocacy work. 

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