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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

Tackling plastic pollution is moving up the EU agenda as European citizens express concern at the impact of plastics on their health and the environment. Many initiatives already look for circular solutions engaging every stakeholder. This implies shared responsibilities and commitment among all actors in the supply chain, including manufacturers, packaging industry, retailers and also consumers. Retailers are aware of their key role in addressing consumers’ concerns on the environmental impact of these products. 

Today at the annual Retail Forum for Sustainability, Karmenu Vella, EU Commissioner for Environment, Maritime Affairs and Fisheries, said: 

“The implementation of the European Strategy for Plastics in a Circular Economy, adopted by the Commission in January, will transform the way plastic products are designed, used, produced and recycled in the EU. In this context, the European Commission has proposed EU-wide rules aimed at fishing gear and single-use plastic products most frequently found on Europe's beaches. We welcome the efforts put forward by the retail sector in reducing the use of single-use plastics. Today’s Retail Forum is a good opportunity to shine the light on best practices put forward by the sector.”

EuroCommerce Director-General, Christian Verschueren, added:

“The retail and wholesale sector understands the concerns of European consumers for more sustainable consumption and circular economy, and has reiterated its commitment to promoting this. The sector has already demonstrated its leadership in reducing packaging and single-use plastics and made collective and individual commitments on, for instance, an 80% reduction in overall waste. Although we can have little impact on cleaning up marine litter, we are actively reducing micro-plastics in the products we sell, providing alternatives to single-use products, improving packaging for own-brand products, seeking to increase recycling and reuse, and developing initiatives on eco-design. Retailers are also investing in sustainable supply chains. To do all this, however, we need the responsibilities for action to be shared fairly across the supply chain, and a clear definition of ‘extended producer responsibility’ on the basis of the recently agreed Waste Framework Directive.”

ERRT Director-General, Susanne Czech, continued:

“By minimising plastic waste in supply chains, promoting recycling, increasing the use of recycled content in their products, and prioritising the use of renewable materials, retailers have already made good progress. The effectiveness and success of retailers’ initiatives have been closely monitored by an independent operator under the umbrella of the European Commission and is collected in the REAP database. For a successful EU Plastics Strategy and implementation within the Circular Economy, the Retail Forum today has showed us once again how important it is to gather all actors across the value chain around the table when discussing circular economy, showcasing the intricacies and complexity that each actor encounters when making its own contribution in addressing the issues related to plastics.”

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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

Valeria Botta - +32 2 808 48 70 - v.botta@errt.org

1. The general provisions of the proposed Directive significantly extend competences to the EU level that were previously left to national authorities under the original Written Statement Directive (91/533/EEC). EuroCommerce and its member associations strongly defend the principle of subsidiarity. In this respect, we reject various prominent features of this Directive such as an extension of the scope to include atypical working relationships (workers working up to eight hours per week or less than one month, that were previously excluded), a definition of worker at the EU level and horizontal provisions on compliance, protection from dismissal and sanctions.

2. The proposed Directive’s provisions on the predictability of work do not reflect the retail and wholesale sector’s need for flexibility. Seasonal and operational requirements result in periods with peak demand requiring more human resources than other times. A retailer has to be able to change working hours according to changing sales patterns, climate and seasonal influences, and in case of unexpected situations.

3. The extended requirements on information provision by employers increase the administrative burden on businesses and are particularly onerous for SMEs. EuroCommerce position is that the existing national rules on written statements should continue to apply.

Commenting today on the draft European Parliament report on so-called Unfair Trading Practices in the food supply chain, EuroCommerce Director-General Christian Verschueren said:

“Retailers and wholesalers around Europe are shaking their heads at what the draft European Parliament report is demanding as changes to the Commission proposal. The Directive is meant to help farmers earn more, yet the latest changes risk offering highly profitable and very strong multinational corporations the ability to wring even more profits out of the European consumer, with no guarantee that these end up anywhere except their shareholders’ pockets.”  

The Commission’s own assessment was that there was no evidence or justification for EU-level intervention in market transactions far away from farmers’ interests. Large multinational corporations hold more power than retailers or wholesalers, and make net profit margins of up to 30%, while retailers’ margins are no more than 1-3%. Any retailer, whatever their size, represents a very small share of these brands’ global turnover, and has little choice but to stock their products; this is reflected in their respective negotiating power.

As it is, the proposal offered poor evidence of the problem and any real impact of such practices on farmers, nor that EU legislation would be better than the 20 national regulatory schemes already in place. Apart from extending the directive to multinational manufacturers, the Parliament’s proposals would also increase the power of large cooperatives, while at the same time exempting them from paying farmers on time.

Some cooperatives, including in the dairy area, control over 80% of any market, and many operate across many territories. This raises the question of who has real bargaining power, or has real choice. These are the same coops who have been subject to extensive investigation into practices that tie farmers into long-term exclusive contracts, and do not pay them, or tell them what price they will be paid, until months after the produce is delivered.

The report somehow forgets the interests of 500 million European consumers, who never get a mention. A number of large manufacturers have already promised their shareholders to increase their profit margins further by 3-10%. Strengthening the negotiating might of large manufacturers will have one result. Retailers, operating on very low margins, will not be able to absorb the resulting price rises - the consumer will have to pay, and no farmer will see an extra cent. The Commission concluded that such an extension of the scope of the directive would harm consumers and was not justified.

We seriously question whether extending the directive’s scope beyond farmers and small manufacturers is possible under the agriculture provisions of the Treaty.  It also means massive regulatory intervention in transactions with nothing to do with farmers, forgetting that the success of the European economy is based on a free and fair market, not state management.

If the Parliament persists in this approach, which only protects sellers, but not buyers, retailers and wholesalers should be able also to use the complaints mechanisms against the abuses they can suffer from large manufacturers. For example, brand manufacturers can suspend or cause intentional disruption of supplies to force retailers to accept higher prices, or force retailers to take all of a manufacturer’s products, rather than what those they can sell. On top of this, brand manufacturers fragment the single market through territorial supply constraints, imposing higher prices, different recipes and a reduced range for consumers in some countries. Is this what the single market is about?

Verschueren added:

“Is rigging the market in favour of large manufacturers and cooperatives, who can themselves often be the source of farmers’ problems, the right road to go down?– it won’t help any farmer earn an extra cent, and only add millions of euros to the shopping bills of hard-pressed families across Europe.”

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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

EuroCommerce is delighted to announce the election of Régis Degelcke as its new President at the EuroCommerce General Assembly today. Mr Degelcke will take up his three-year mandate from July 2018.

Mr Degelcke brings a wealth of knowledge and experience in the retail and wholesale sector. He currently is Chairman of the two companies, Auchan Retail and Auchan Holding, to which he was appointed to by the Mulliez family in early 2017. Mr Degelcke began his career in retail 35 years ago as a financial controller at Leroy Merlin, and was appointed CFO of the group at the early age of 29. Six years later, keen to have hands-on store experience, he left headquarters to become a store manager in Spain. Later, under his leadership as country manager for France, Leroy Merlin grew significantly to become the leading home improvement retailer. As a true global citizen, he went on to lead the international expansion of the LeroyMerlin/Adeo Group as Executive Vice-President in Italy and Brazil. For a period, he also headed relations with professional customers of the group, which provided him with profound insights into the world of wholesale. For the last 10 years, he has chaired the European DIY Retail Association (EDRA), having previously headed the French DIY association (FMB).

Mr Degelcke commented upon his election:

“I am very honoured to have the opportunity to lead the principal European organisation representing retail and wholesale. I look forward to bringing my experience and expertise to help continue the great work by EuroCommerce under Kenneth Bengtsson’s leadership. The sector is undergoing a major digital transformation, while also facing economic and policy challenges in the EU, including growing protectionism and economic nationalism. A stronger and more competitive Europe is the only way we will compete with other major global economic powers. We need an effective and unified representation of our sector in Europe, and a better public understanding for the positive role that retail and wholesale play in the lives of European citizens and businesses. I am keen to play my part in achieving this over the next three years. And I am calling upon my fellow retail and wholesale leader to be more engaged in this.”

Stepping down from his role as President, Kenneth Bengtsson, added:

“I believe we have strengthened EuroCommerce over the past three years, and achieved better recognition for retail and wholesale, despite a challenging economic and policy context. Our members look forward to working under the leadership of Régis. He is a passionate leader of the industry and will help EuroCommerce to reach new heights.”

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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

On 11 April the European Commission proposed a set of measures revising some of the existing consumer protection rules and proposing targeted changes to Unfair Commercial Practice Directive (UCPD), Consumer Rights Directive (CRD), and Price Indication and Unfair Contract Terms directives.

Overall we are disappointed that despite the Fitness Check report showing no need for a major overhaul of the rules, the Commission proposed a set of far reaching changes without proper impact assessment.

Although the proposal is targeted to specific issues, many concrete drafting proposals raise issues of clarity, proportionality and undermine the full harmonisation approach of the CRD and the UCPD.

EuroCommerce Director-General Christian Verschueren warned of major consequences for global supply chains resulting from US President Donald Trump’s decision to impose additional tariffs on steel and aluminium imports from the EU, Mexico and Canada:

“The global trading system which the US was instrumental in building up over the last 70 years has created economic well-being throughout the world. Free trade has lifted millions from poverty in developing countries and enhanced the quality of life of everyone, not least in the US, whose companies have also built up a major multinational presence on the back of it. Attacking close allies with open market economies in the name of national security is not just unwarranted, but the protection it seeks to give these industries will ultimately harm their competitiveness – and backfire on all economies, not least the US. Protectionism simply does not work, and just makes everyone poorer.”

Retailers and wholesalers depend on global supply chains and need a predictable policy environment to operate in efficiently. Now, more than ever, it will be up to the EU to take the lead and defend the international trading system through a firm commitment to the multilateral trading system of the WTO flanked by the EU’s ambitious bilateral trade agenda. The recently concluded EU-Mexico agreement is a first step to implementing or concluding many others, whether with Japan, Vietnam, Mercosur or Australia and New Zealand, and shows a striking contrast with short-sighted American protectionism.

Calling on all parties to exercise caution and common sense, Verschueren added:

“Instead of creating a spiral of unilateral action and damaging retaliation, countries should look to using – and strengthening – the powerful tools for dispute settlement they have agreed to in the WTO. Our economies are just recovering from the financial crisis 10 years ago. The last thing they need now is a return to the economic thinking of the 1930s which was responsible for deepest depression in recent world history.”

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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 

Ahead of the 8 June TTE Council, we urge Member States to remain cautious in their examination of the draft ePrivacy Regulation (ePR). Limited progress has been achieved since the beginning of Council discussions early last year and many questions remain open. More time is needed to assess the ePR’s scope of application, its overlaps with the General Data Protection Regulation (GDPR) and its impact on all sectors of the economy.

The ePR proposal has departed from the laudable objective of protecting the confidentiality of communications and goes on instead to greatly limit the processing of a broad array of both personal and non-personal data. Rather than complementing the GDPR, the proposal replaces and contradicts many of the fundamental checks and balances of the EU’s data protection framework.

Commenting on the country-specific recommendations (CSRs), issued last week by the European Commission as part of the European Semester process, EuroCommerce Director-General Christian Verschueren, said:

“As the biggest private employer in Europe, retail and wholesale are a major factor in the EU economy. They are uniquely exposed to wide-scale regulation and suffer when this goes wrong. Regressive taxation and regulation, such as the French local property tax TASCOM, and, in a number of Member States, protectionist policies against foreign retailers, are holding back growth and harming consumers. Meanwhile manufacturers carve up the Single Market to the detriment of consumers and raise prices in some countries such as Belgium. These are not just missed opportunities for our economies, but every unnecessary barrier means real costs for consumers and a block on new jobs for many thousands of Europeans. The CSR exercise highlights these problems, and should be followed up with real action by Member States and where they are in breach of EU law, enforcement by the Commission.”

Retail and wholesale support the European Semester process, but it needs to go further. The recent Commission Communication ‘A retail sector fit for the 21^st century’ was an important step towards a better understanding of the significant drivers of retail competitiveness. It showed the cumulative impact of unnecessary national and local regulation and barriers. It underlined the importance of national and local authorities acting to meet the needs of retail, and thinking hard about the measures they impose. The Commission rightly pointed to the positive spill-over effect that the right policy decisions will have on other business sectors. This needs action, both to persuade Member States to think hard about the burdens they impose on retail and wholesale, and pursue actively measures incompatible with EU law, which not only harm consumers, but are a drag on the competitiveness of the country’s whole economy.

In the light of this, it is disappointing that only five CSRs mention retail and wholesale - Belgium, Denmark, France, Hungary and Italy. In Belgium, it found regulatory restrictions weighing on the sector's performance and deterring investment. Prices for many product categories continued to be higher than in the neighbouring countries, as pointed out in the Benelux study published last week and in the Commission communication on retail last month, because, in part, of the fragmentation of the Single Market by large brands with territorial supply constraints. This is not what the Single Market should be about, and as pointed, it causes real problems where consumers in some countries perceive that they are being given a worse deal than others in the quality or price of what they buy.

In Denmark, the Commission found competition in several domestically-oriented services sectors weak, including retail and wholesale. The Commission saw competition in France hampered by burdensome regulatory and administrative requirements, and excessive entry restrictions. EuroCommerce and its French member have also pointed on numerous occasions on the distortive effect on competitiveness of bricks-and-mortar stores of TASCOM, the local property tax based on floor area. Hungary was again highlighted as imposing major regulatory barriers and an unpredictable legal environment on retail, impairing its performance, productivity and innovation. In Italy, the CSRs pointed to significant regulatory barriers to competition in certain sectors, including retail.

This year’s CSRs, however, does not give the full picture: retail restrictions and burdensome regulation in, for example, the Czech Republic, Poland, Romania and Slovakia are not mentioned in their CSRs.  The Communication on retail cited above underlined the negative effect of such regulation, and that blocking competition in retail and wholesale has a negative spill-over effect on other sectors like business services, and the producers of the food and other products they sell.

Verschueren added:

“CSRs are a useful tool. In the face of a Single Market under ever-growing threat from protectionism, we need to convert them into urgent action for change at national and EU level:  European growth is set to tail off in the coming years, and the Single Market is the engine that can drive our global competitiveness, yet short-sighted national regulation is starving it of the fuel it needs to do this.” 

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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