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EuroCommerce warned, after the vote today in the European Parliament’s EMPL Committee on the Transparent and Predictable Working Conditions Directive, that some of their amendments will act against the interests of both temporary and permanent workers in the retail sector. EuroCommerce Director-General Christian Verschueren said:

“Our sector employs 29 million Europeans, and one in five of every young person employed in Europe. The sector faces a major challenge in the shift to online sales and further competitive pressure on its margins. By removing the flexibility needed by the sector to employ extra staff at peak times such as Christmas, the Parliament is putting at risk not only temporary jobs, but the future of retailers with permanent employees as well.”

The amendments will have the effect of making it impossible to hire mostly young workers, employed on contracts up 8 hours per week. This will block retailers taking on extra staff to meet peak demand or replace sick employees. This penalises young people working a limited number of hours in shops and supermarkets alongside their studies, who cannot work more hours and will lose an important source of supplemental income. Others will miss out on a formative first job experience in retail with opportunities to acquire important interpersonal and soft skills that are essential in a digitalised society. This is a step in the wrong direction where youth unemployment in so many member states is still unacceptably high.

Introducing minimum guaranteed paid hours and ratcheting up the fixed hours of workers will severely undermine the current use of flexible working arrangements by retailers. This will not benefit employers or workers. Paradoxically, retailers may be forced to use temporary contracts instead of offering more predictable open-ended contracts, even of these contracts are part-time.

Verschueren added: “At a time when the digital revolution makes it vital to the survival of bricks-and-mortar shops to have knowledgeable and helpful staff available to help customers, the Parliament, in the name of protecting temporary and part-time workers will create a barrier to employing them at all. Undermining the position of retailers in the name of protecting employee rights does little for either permanent and temporary staff if the result is their shop closing and them losing their jobs”

These proposed changes are complex and intrusive, unnecessary at EU level and are incompatible with subsidiarity. EuroCommerce is very concerned at these changes, as well as a number of fundamentally flawed amendments, including an ill-conceived attempt to create an EU definition of worker, highlighted by BusinessEurope and other business groups.

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Contact:

Kinga Timaru-Kast - +32 2 894 64 83 - timaru@eurocommerce.eu   
Neil McMillan - +32 2 737 05 99 - mcmillan@eurocommerce.eu   

Opening the first conference on circular economy dedicated to retail and wholesale, EuroCommerce President Régis Degelcke said: “If there are three words we should all think of in terms of the circular economy, they are cooperation, consistency and commitment. Retailers and wholesalers are pushing and will – push ahead with creating sustainable solutions, but these can only be effective with the active and committed participation of all, working together to achieve the right results across all sectors.”

Delivering a keynote address on the state of play in circular economy, Janez Potočnik, former EU Commissioner for the Environment, and current co-chair of the UN International Resource Panel, said: “With growing population and increased pressure on resources, circular economy is not an environmental policy, it’s a logical solution to the challenges faced  in the 21^st century: we need to change the way we produce, we consume and we live.”

EuroCommerce organised this major conference today to discuss how retail & wholesale businesses can work together with government and others in the supply chain to achieve a circular economy. The main message will be the need for cooperation in giving value to resources that otherwise would have been discarded, and making this a part of normal business models. This is not just about waste management, but designing products and systems to prevent waste from the outset.

The conference was also an occasion to showcase the many initiatives by retailers and wholesalers to contribute to a more circular economy. It debated, with members of the European Parliament and NGOs, on how to overcome barriers to scale up solutions to:

-          curbing food waste,

-          introducing new business models in chemicals,

-          addressing obsolescence and triple R in fashion retail,

-          improving our deliveries in the age of e-commerce,

-          and reducing our use of plastics.

Some of those actions have been captured in the 10-year-old Retail Environmental Action Programme, which retailers have been running together with the European Commission.

Daniel Calleja Crespo, Director-General of the European Commission acknowledges this: “The circular economy is an essential part of our efforts to meet the Sustainable Development Goals, the Paris Agreement, and to promote a better life for all. Striking a fair balance between deploying innovation and maintaining the safety of our products and consumers is an important part of the equation, and we recognise the efforts made by the retail and wholesale sector in this matter.”

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Contact:

Kinga Timaru-Kast - +32 2 894 64 83 - timaru@eurocommerce.eu   
Neil McMillan - +32 2 737 05 99 - mcmillan@eurocommerce.eu   

The European Parliament Environment Committee voted today to amend the Commission’s proposal on the reduction of the impact of plastics on the environment. This proposal aims to prevent littering from 10 single-use plastic products frequently found on Europe’s beaches.

Despite strong concerns raised by players in the entire supply chain, the Commission proposal and amendments to it fail to hit the right targets for how reduce littering. Most of the proposed amendments suggest simplistic solutions which will do nothing to help prevent plastic products leaking into the environment. EuroCommerce Director-General Christian Verschueren regretted the lack of proper focus in the amendments:

“It is astonishing to see so many measures are being proposed in this Directive and the EP amendments, but how few actually tackle littering effectively. It is as if the core objectives of this Directive got lost somewhere in the politically-driven debate. This is a missed opportunity for Europe, and for finding real solutions to the problems of plastic pollution.”

A particular concern for retailers and wholesalers is the report’s almost exclusive reliance on Extended Producer Responsibility to finance clean-up costs, where these were formerly dealt with by local authorities. The proposal also expands the number of separate waste streams to an almost absurd extent – to include balloons, tobacco products and even wet wipes. Quite apart from the feasibility of creating individual schemes for each of these products, and questions of hygiene and health risks, this will have a massive cost and is unlikely to have any appreciable effect in reducing litter.

The Commission Impact Assessment itself estimates the clean-up cost of, for example, wet wipes at up to €24.000 per tonne, which would have to be added to the cost of these and all the many products covered by the proposal and the amendments.

Overall, the Commission estimate that their original proposal could cost retailers up to an additional € 10million[1]. We consider this a rather modest estimate, but whatever the final cost to our sector and the consumers who will have to pay more, this will be a wasted effort if it cannot provide some certainty that it will change people’s antisocial behaviour and stop them littering these products. As the proposal stands at the moment, our sector sees no prospect that it will.

Speaking after the vote in the European Parliament AGRI committee this evening, EuroCommerce Director-General Christian Verschueren warned that the debate and vote in the Parliament has moved the discussion towards a witch hunt against retailers and wholesalers:

“The Commission put forward a proposal aimed at protecting farmers and SME processors. In the course of parliamentary discussions, driven by slogans such as ‘Fairness for all’, the directive as amended protects big food multinationals, and the debate has turned into a targeted and direct attack on legitimate negotiations between retailers and suppliers”.

The series of amendments pushed through the Parliament AGRI committee tonight and in the IMCO committee last week will do nothing for fairness in the supply chain. By imposing more restrictions on retailers and their ability to provide services, it will make it more difficult for retailers to negotiate the better prices they pass on to consumers, in particular when negotiating with large suppliers. Farmers will gain nothing from legislation allowing large multinational brands to impose higher prices on retailers and consumers. As the Chief Economist of DG Competition told the committee last week, a large multinational getting a higher price for an ice cream will not feed back to the milk farmer, and the milk may not even be sourced in the EU.

Verschueren concluded: “As voted today, the directive will end up making the strongest players in the market even stronger and the weaker players - farmers, SMEs, and consumers - even weaker. A witch hunt against retail and wholesale to line the pockets of multinational shareholders and do nothing for farmers is surely not what this directive should be about.”

Another important point is that the directive gives rights to sellers, but none to buyers. This approach puts into question some of the fundamental principles of the EU on equality of treatment and respect of legal base. In a letter to the Presidency, 22 retail and wholesale CEOs, asked for an opinion on the legality of these changes (see here).

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Contact:

Kinga Timaru-Kast - +32 2 894 64 83 - timaru@eurocommerce.eu

Neil McMillan - +32 2 737 05 99 - mcmillan@eurocommerce.eu

The CEOs of 22[1] leading retailers and wholesalers across Europe have written to the Chair of the EU Agriculture Council, Mrs Elisabeth Köstinger to express their intense concern at the idea currently being promoted by powerful multinational food processors that they need protection against retailers, in the UTPs directive currently under consideration by the European Parliament and the Council of Ministers. They question both the legality and the economic consequences for consumers, farmers, and small-and-medium enterprises, of giving one powerful set of players even more power. They ask Mrs Köstinger to seek a formal opinion from the Council Legal Service on the legality of such extended protection.

The directive, as originally proposed by the Commission, aimed to protect farmers and small-and-medium enterprises in their dealings with bigger buyers, whether manufacturers or traders, by limiting payment terms on perishable products, banning a few practices such as unilateral & retroactive changes to contracts or last minute order cancellations and allowing certain practices such as joint contribution to marketing and promotion campaigns provided that they have been agreed by the parties. Amendments pushed by big multinational manufacturers, under the false pretence of “fairness for all”, proposes to have those large companies covered as well, and to extend the list of prohibited trading practices. If adopted, those amendments would considerably reduce the scope for practices that can benefit both parties and limit freedom of contracts. This will not benefit farmers.

The letter states that “extending protection to large manufacturers, and covering service providers that do not buy or sell food products, will have a number of unintended consequences”. It also expressed concerns that this extension to big multinationals “raises fundamental questions of its compatibility with the legal base”, as an agriculture legal base needs to demonstrate a benefit to farmers.

In this regard, the letter points to a number of salient facts being ignored in the headlong rush to adopt amendments promoted by large multinationals to the directive:

- even the largest European retailers have a market capitalisation of less than one-tenth the size of large industrial food processors, who operate across the world, and enjoy 15-30% net profit (EBIT) compared with the EBIT of large retailers of 2-4%;

- no European retailer makes up more than 2% of the global turnover of these multinationals

- the danger of this extension of scope has been clearly set out by the Commission, who warn that neutralising the ability of retailers to negotiate with large manufacturers will create significant market disruption, increased profits for manufacturers and higher prices for consumers.

- the Commission has also stated that the benefit from these higher prices on highly processed industrial food products is unlikely to be shared with farmers or the l other suppliers of these multinational manufacturers.

The CEOs reaffirm their “very clear interest in treating suppliers, large and small, fairly”. This is reflected in their commitment to the Supply Chain Initiative and their “strong support for agriculture policies aimed at helping farmers organise, become more innovative and competitive, and create sustainable supplies of attractive products that meet consumer demand”.

The CEOs further point to the consequences on the future of retail and their ability to stay relevant in a rapidly changing sector arising from digitalisation: “Retailers are a key contributor to employment in Europe (…). Our sector is also characterised by high costs and low margins. The rapid growth of online sales is squeezing those low margins even further. Retailers are making huge investments to stay relevant in this digital age: new infrastructure and technology, new services, new business models. (…) Handing more profit to large multinational suppliers in this directive will intensify these pressures and further exacerbate risks in terms of employment.”

For further facts and figures about the supply chain, please click here. 

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Contact:

Kinga Timaru-Kast - +32 2 894 64 83 - timaru@eurocommerce.eu

Neil McMillan - +32 2 737 05 99 - mcmillan@eurocommerce.eu

Speaking after today’s vote at the EP Plenary on the own-initiative report by Mark Demesmaeker MEP (ECR, BE) on the European Strategy for Plastics in a Circular Economy, EuroCommerce Director-General Christian Verschueren repeated the retail and wholesale sector’s commitment to creating a circular economy, but highlighted the need for a proper focus in the draft legislation the Commission has now proposed. He said:

“We are actively involved in reducing waste in the supply chain, and see Extended Producer Responsibility (EPR) schemes as a valuable tool to involve the whole chain in disposal, collection, sorting and recycling of waste. We do not consider them as the panacea to addressing systematic failures resulting in littering. This is why we believe that EPR is already fully covered in the Waste Framework Directive and the Packaging and Packaging Waste Directive, and should not be dealt with again in plastics regulation. We are also worried that the proposal for a very ambitious separate collection target for bottles could unintentionally undermine well-functioning collection systems and be impossible for small and medium-sized enterprises to meet.”

The EP report and today’s vote adds weight to the upcoming discussion on how society produces, dismantles and discards plastics, and how this is regulated. Retailers and wholesalers have responded for many years to the growing awareness by society of the environmental impact of what it buys and throws away. A recent Eurobarometer poll showed 87% of respondents as being concerned about the health and environmental impact of plastics.

The Retail Environmental Action Programme (supported by the European Commission) reports annually on our sector’s achievements in this area. Many retailers have made a series of commitments: to reduce plastics use by at least 20% by 2025; to reach up to 100% of recyclable products by the same date; to remove single use plastics products from their stores.

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Contact:

Kinga Timaru-Kast - +32 2 894 64 83 - timaru@eurocommerce.eu

Neil McMillan - +32 2 737 05 99 - mcmillan@eurocommerce.eu

The SCA and Agriculture Council will be asked over the coming weeks to decide on a set of amendments presently being rushed through the institutional process, the most fundamental of which is to give large manufacturers, who operate all over the world, the same protection as small farmers and SMEs.

In a briefing note circulated to SCA members ahead of their meeting today, EuroCommerce raises major concerns over the legality and the unintended consequences of extending the scope of the directive to large suppliers, and calls on member state representatives to maintain the balance the Commission has sought in their proposal.

Christian Verschueren, EuroCommerce Director-General, said:

“The Commission proposal is aimed at supporting farmers and small manufacturers: their own impact assessment presented strong evidence that further skewing the balance of power to massively profitable multinationals would put up prices and harm the consumer, with no evidence that any of the extra money earned by these industrial giants would be fed back to farmers.”

The EuroCommerce briefing note argues that:

• the proposal is based on Article 43(2) TFEU, and therefore needs to demonstrate a direct benefit to farmers and/or consumers. A transaction involving an industrial food product sold by a large manufacturer to a retailer ceased long ago being a transaction involving a farmer and thus cannot be covered under an agriculture legal base.

• the directive gives rights to suppliers, but none to buyers. In adding to the power and profits of the largest players in the supply chain, but giving no rights to buyers who are smaller than them, the important rights of equality and non-discrimination laid down in European law are being cast aside.

The full text of the statement is attached overleaf, along with facts and figures underlying the arguments in the statement, setting out the reality of how the food supply chain works.

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Contact:

Kinga Timaru-Kast - +32 2 894 64 83 - timaru@eurocommerce.eu

Neil McMillan - +32 2 737 05 99 - mcmillan@eurocommerce.eu

PRESS RELEASE, Brussels, 6 September 2018: Speaking at a conference organised today by amfori and EuroCommerce on rules of origin, the heads of both associations warned that, unless rules of origin for products were improved, they would continue to discourage European companies, particularly small ones, to take advantage of hard-won concessions in trade agreements. Rules of origin determine the “nationality” of a product. To benefit from global value chains, companies need clear rules, but the complexity of rules of origin – preferential and non-preferential – continues to discourage trade, in particular for SMEs. The often very different rules in each of the many bilateral trade agreements signed in recent years adds to what is already a confusing picture.

EuroCommerce Director General Christian Verschueren said:

“Even the most beneficial trade agreements have little effect if the rules of origin are too complicated. There is definitely something wrong when small companies, but also some big enterprises prefer to pay import duties rather than dealing with a set of different rules of origin. There is an urgent need for a modernised system which recognises that we are operating in a world of global supply chains, where complex products are made up of parts from all over the world. ”

amfori President, Christian Ewert, noted that

“amfori and EuroCommerce have been saying for many years that origin rules need to be simplified, harmonised – ideally at the global level – and regularly updated, so that they properly reflect modern global value chains.  This should include wider rules for cumulation and less stringent rules for granting preferential origin.  Without these improvements there is a definite risk that the benefits of trade agreements will continue to be only partially adopted and even a risk to the future of new trade agreements entirely.”

These problems, including those connected to cumulation, which should allow production across more than one country, mean that companies will only partially be able to take up the benefits of trade agreements. On top of these difficulties, under the recently-adopted Registered Exporters System (REX), that replaces the certificate of origin Form A, importers now run the risk of being held liable for any incorrect information provided by the exporter on the origin of a product. This approach should be revisited to find a more balanced set of rules on an importer’s burden of proof when dealing with customs authorities in the EU.

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Contact:

Kinga Timaru-Kast - +32 2 894 64 83 - timaru@eurocommerce.eu

Neil McMillan - +32 2 737 05 99 - mcmillan@eurocommerce.eu

Virginia Mercouri - +32 489 095 044 - virginia.mercouri@amfori.org

Stuart Newman - +32 2 741 64 04 - stuart.newman@amfori.org

EuroCommerce Director-General Christian Verschueren commented on the signing of the EU-Japan Economic Partnership Agreement today:

“This is a good day for free trade. The formal signing today of the EU-Japan Economic Partnership Agreement, the largest trade bilateral trade agreement the EU has completed so far, sends an important message to those leaders who want to throw away all that a rules-based world trading system has achieved.  It means the removal of a large number of tariffs affecting trade between us – this is great news for consumers and businesses in both markets. The conclusion also today of a data transfer agreement with Japan will make e-commerce easier, while guaranteeing protection of personal data.”

EuroCommerce was one of the first business groups to press for a trade agreement between the EU and Japan. Being the EU’s second biggest trading partner in Asia after China and its sixth most important trade partner worldwide it is a vital step in the Commission’s bilateral trade agenda. Together, the EU and Japanese markets count for a third of the global GDP and the agreement is expected to save up to €1 billion a year in customs duties. For European retailers and wholesalers this is a major success story, full of opportunity. We hope that the agreement can enter into force next year.

Verschueren added: “Everyone – businesses and consumers – will be able to reap the benefits of this trade deal as soon as it enters into force:  for many products, tariffs will then be eliminated immediately. We therefore very much hope that the European Parliament and Member States let Europe enjoy these benefits by ratifying the agreement quickly.”

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Contact:

Kinga Timaru-Kast - +32 2 894 64 83 - timaru@eurocommerce.eu

Neil McMillan - +32 2 737 05 99 - mcmillan@eurocommerce.eu

Online retail has continued its double-digit growth, with European ecommerce turnover increasing by 11% to €534 billion in 2017 and forecasted to grow by 13% to €602 billion in 2018. In 2013, it was no more than €307 billion. This is one of the many findings of the European B2C Ecommerce Report 2018, that will be jointly launched today by Ecommerce Europe and EuroCommerce. The report sets out the main ecommerce [1]trends, facts and figures, and offers insights for each of the European ecommerce markets.

Marlene ten Ham, Secretary General of Ecommerce Europe, stated: “As the European ecommerce association, we are delighted to see these figures, because strengthening and fostering online sales in Europe is our mission. We aim at creating a level playing field for online trading in EU countries and these data offer great insights into European ecommerce markets and provide valuable information for companies that want to start selling cross-border in Europe”.

Online retail is strongest in Western Europe, with approximately 68% of total European online retail turnover. This can be attributed mainly to Western Europe’s advanced infrastructure, high internet penetration and high level of consumer trust and familiarity with online shopping. Southern Europe, Northern Europe and Eastern Europe show lower share of European ecommerce: 12%, 8% and 6% respectively. However, these are the regions with the fastest growth, reflected by the annual ecommerce growth rate in Romania of 37% last year.

Key trends identified in the report show that the largest ecommerce market in Europe is the UK (€178 billion[2]), followed by France (€93.2 billion[3]) and Germany (€93 billion[4]). The UK scores the highest also in terms of E-GDP (i.e. Ecommerce Turnover / GDP = Ecommerce Share of GDP), with a 2017 rate of 7% and a projected 8% in 2018.

The report also reveals challenges that consumers still face when shopping online. Among the main complaints are speed of delivery (17%) and technical failures (13%). Logistical performance plays a crucial role in the success of ecommerce penetration and integration within a nation. Germany, Luxembourg, The Netherlands, and Sweden excel in this regard, topping the list of European countries according to the Logistical Performance Index from the World Bank.

Christian Verschueren, Director-General of EuroCommerce commented:

“These figures show how the fast-growing role of online sales is both driving, and responding to, changes in consumer purchasing behaviour. In those markets where this trend is still slow, much progress could be made if more was invested in the communications and logistical infrastructure which ecommerce needs to work effectively if it is to thrive. Meanwhile, we will continue to press for a regulatory regime which creates the right conditions for growth in all channels of sales, and helps the EU compete globally in innovation in retail.”

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Contact:

Luca Cassetti, +32 2 502 31 34, lucacassetti@ecommerce-europe.eu

Laura Contin, +32 2 502 31 34, lauracontin@ecommerce-europe.eu

Kinga Timaru-Kast, +32 2 894 64 83,  timaru@eurocommerce.eu

Neil McMillan, +32 2 737 05 99, mcmillan@eurocommerce.eu

Metje van der Meer, +31 6 484 562 82, metje.van.der.meer@ecommercefoundation.org

Sara Lone, +31 6 139 690 54, sara.lone@ecommercefoundation.org