EU asks comments on new rules for olive oil sales

The European Commission is inviting comments on new draft guidelines on the application of EU antitrust rules in the agricultural sector. After a reform of the EU’s Common Agricultural Policy (CAP), new specific rules apply to the sale of olive oil, beef and veal livestock and arable crops. In particular, the new rules allow producers to jointly commercialise these products if certain conditions are fulfilled, including that their cooperation creates significant efficiencies. The Commission’s guidelines will contribute to ensuring that the implementation of the CAP reform improves the functioning of the food supply chain and safeguards effective competition and innovation on the markets for agricultural products. Responses to the public consultation can be submitted until 5 May 2015. In light of the submissions received, the Commission will then review its proposal, with the aim of adopting final guidelines by the end of 2015.

On 1 January 2014, the new EU CAP entered into force, including a specific competition regime for certain agricultural products. In particular, the reform allows producers jointly commercialise olive oil, beef and veal livestock and arable crops via producer organisations or associations of producer organisations, provided that:

i. Such organisations should make farmers significantly more efficient by providing supporting services, such as storage, distribution or transport services; and

ii. The quantity marketed by the organisation does not exceed certain thresholds.

The Commission is now providing guidance on how these new rules can be best used to boost investment and growth, while maintaining a level playing field for all operators in the Single Market. In particular, the draft guidelines set out: examples of how producer organisations can provide services that generate significant efficiencies for farmers; guidance on how to check that the volumes marketed by producer organisations do not exceed certain production volume limits and the situations in which competition authorities may apply a safeguard clause and have joint commercialisation contracts by a producer organisation re-opened or cancelled.

National competition authorities and ministries of agriculture have already been consulted on this proposal. The Commission now invites stakeholders to provide their views on the draft guidelines. Contributions can be sent until 5 May 2015. The Commission will present the proposals in a conference on 4 March 2015 to stakeholders, national competition authorities and ministries of agriculture. The full text of the proposals is available here.

Background

The Commission’s impact assessment in the context of the CAP reform pointed out the need to improve the functioning of the food supply chain and to create the right conditions for the agricultural sector to become more competitive and innovative. In particular, this implies encouraging cooperation between farmers while ensuring competition in the sector.

The 2013 CAP Reform modifies antitrust rules for the agricultural sector, in particular as regards the olive oil, beef and veal and arable crops sectors. The new rules are laid out in Regulation 1308/2013 establishing a Common Market Organisation for agricultural products (“CMO Regulation”). In June 2014, the Commission announced that it would provide guidelines about potential competition law issues arising in the implementation of this new regime. Moreover, the Parliament has requested to ensure a consistent application of the 2013 CAP reform across EU Member States and Article 206 of the CMO Regulation requires the Commission to adopt guidelines to that effect where appropriate.

Source: European Commission

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