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Brussels, 05 May 2021 - As representatives of sectoral employers, strongly engaged in social dialogue at national and EU level, we are committed to continuously improve the working conditions of our employees and share the objectives. We are however strongly concerned about the implications of the proposal for a Directive on adequate minimum wages on the role of Social Partners and on statutory minimum wages.

Indeed, as EU sectoral employers, we firmly believe in the autonomous role of our members in collective bargaining at national, sectoral and company level and support the right of Member States to set minimum wages according to national law and practice. Regrettably, the proposal does not respect these two core principles underpinning the European social market economy. For us, the EU has no competence to introduce any action regarding pay and collective bargaining as there is no legal basis to do so.

For these reasons, the sectors we represent are highly concerned about the proposed Directive. They fear in particular that top-down governmental intervention may crowd out better, closer-to-the-ground solutions, devised by social partners at national, sectoral and company level. The ability to set wages at the closest possible level to the workplace is crucial to adequately and timely respond to the rapid change taking place in our sectors.

As employers from different sectors that need dynamic and adaptable labour markets, we also challenge the European Commission assessment that there is a lack of social protection for certain forms of work, such as part-time work, fixed-term contracts and temporary agency work. Especially for these three forms of work, specific EU Directives are already in place, ensuring appropriate working conditions.

1- Legal basis of the Proposal for a Directive is problematic and could lead to competence conflict

 The chosen legal basis (art. 153(1)(b) TFEU) is problematic in the context of setting minimum wages and collective bargaining as these two issues are excluded from the TFEU.

Further, as evidenced by the Council Legal Service’s assessment of art. 6 (variations/exemptions) there is a high risk of legal difficulties in the transposition and enforcement phase of this Directive in case the co-legislators agree on binding provisions on adequacy of minimum wages and coverage of collective agreements. Therefore, Article 6 should be fully amended.

The EU semester would be a better tool to facilitate Member States’ exchange of information and best practice in these fields. We continue to support voluntary capacity-building initiatives on social partnership and collective bargaining in those countries where this does not exist. However, the Commission cannot simply create social dialogue and social partners through EU legislation: social dialogue can only work when it is sectorial, autonomous and voluntary.

 2- Upholding the autonomy of social partners (art. 4)

The Commission’s overall good efforts to prevent an unequal recovery from Covid-19 are contradicted by the provisions on the coverage of collective agreements (art. 4), which clearly violate the autonomy of social partners (protected by Article 152 TFEU and explicitly cited as a fundamental right in art. 28 EU Charter of Fundamental Rights).

The Directive would therefore not achieve its aim to promote social dialogue and collective bargaining in Europe at a time when good social partnership is needed most. To the contrary, setting arbitrary targets for collective bargaining at EU level will merely result in opening a back door for political interference in wage-setting across Europe and lead to increased social tensions rather than good social relations. Consequently, the EU institutions should refrain from regulating collective bargaining at EU level.

3- Respecting statutory minimum wage systems (art. 5)

It is important that new EU social affairs legislation does not upset the division of competences between the EU and member states. We would like to stress that decisions on adequacy (article 5) of member states’ minimum wage systems are national prerogatives. As such, the Directive’s provisions should therefore be designated as recommendations rather than provisions that are binding on member states. Furthermore, the EP and the Council should refrain from defining set targets for the level of minimum wages (e.g. measured by a set percentage of the national median wage levels, etc.)

Although we welcome the provisions on involving social partners in statutory minimum wage setting systems (article 7), we are convinced that the removal of binding provisions is the best guarantee for the national, sectoral and company-level social partners to retain real involvement in statutory minimum wage setting. National statutory minimum wage setting processes set and review minimum wage levels regularly, independently and with the involvement of social partners. They should be fully respected by the proposed legislation.

Against this background:

European sector employers urge the EU Institutions to reconsider their approach on this matter, including the choice of the Directive as an instrument, and to guarantee that the principle of autonomy of the social partners enshrined in the EU Treaties is fully respected throughout the legislative process. As European employers, we are willing to provide input and expertise to shape an initiative on adequate minimum wages that fully respects the right to collective bargaining, the autonomy of social partners and statutory minimum wages.

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European employers’ organisation of the tech & industry, security industry, banking, chemicals, cleaning & facility services, retail & wholesale, construction, agriculture, hotel & gastronomy and private employment services industry are concerned about the implications of the proposal for a Directive on adequate minimum wages. The 10 European sectoral employers’ organisations together regroup well over 33 million companies providing jobs to nearly 114 million employees.

Commenting today on the publication of the Commission’s updated Industrial Strategy, EuroCommerce Director-General Christian Verschueren said:

 “We strongly support the new focus on essential ecosystems, including retail, in the updated Industrial Strategy. Retail and wholesale play a vital role in the European economy and the functioning of numerous other ecosystems. We need support in the digital and green transition to help drive the post-COVID recovery, and for wholesalers to be recognised as an important part of numerous ecosystems. The strategy also needs to be firmly linked to a competitive, single European market which serves consumers, as a basis for building resilience and competing internationally.”

The strategy represents an important framework for recovery in which we can be a central force. We provide employment to 29 million Europeans, (10 million in wholesale), and are an anchor for local communities. Private consumption makes up 50% of EU GDP, and our sector is closely connected to, and feeds numerous other ecosystems.  More mapping of how ecosystems interact, and how the strategy can build on these links is needed,and in this analysis, for wholesalers to be recognised as playing an important role in the EU economy and the supply chain, connecting suppliers and business customers across numerous ecosystems.

The strategy’s strong emphasis on the single market is absolutely right. Covid has demonstrated the critical role that the single market plays in ensuring resilient supply-chain, and providing a strong market base for companies to compete globally.  The Commission’s welcome commitment to tackling short-sighted national protectionism needs to be acted on quickly, also in fully applying the Services Directive and enforcing the free movement of goods. In this context, it is important to remember that services are also an industry, and represent over 70% of EU’s GDP. They and manufacturing depend on each other, and are increasingly difficult to distinguish.

The single market cannot be separated from ensuring that strong competition remains the norm, even when seeking to support European autonomy in certain areas. Competition at home is vital to being competitive globally, and ensuring that both business customers and consumers continue to have a wide choice of innovative and affordable products and services. The Commission communication on tackling unfair foreign subsidies will, applied proportionately, also help secure Europe’s position in the global market.

We need the strategy to provide the right framework to support our ecosystem fully embracing digital and sustainability.  More than 2 in 3 retailers had no online operation before COVID, and the pandemic showed just how important omnichannel was for many companies’ survival, in particular, but not only, SME retailers and wholesalers. Going online is costly and takes time to become even marginally profitable.  There is also a need for legislation to provide a level playing field to help strengthen the sector in a digital environment. We are committed to helping address the challenges of sustainability, and the strategy and relevant legislation must work together to provide the right market incentives and infrastructure to ensure that the EU meets its sustainability targets, and to allow e.g., plastics and textiles to be reused and remanufactured.

You can see the priorities for recovery in our Pact for Commerce here and how our sector was affected by COVID here.

EuroCommerce together with ECommerce Europe sent a joint letter to the European Banking Authority and the European Commission expressing their concern at the continued levels of transaction failure rates following the implementation of Strong Customer Authentication (SCA) in January.

The letter highlighted some of the problems merchants were still experiencing, together with the impact on consumers. It suggested that information gathering at National level appeared to be predominantly focused on measuring compliance of the Regulation rather than if SCA is working as intended. 

It also made references to whether the new fees introduced by the major card schemes are fully justifiable - especially in the context of expected reductions in fraud. 

Welcoming the long-awaited publication of the Commission communication on better regulation, EuroCommerce Director-General Christian Verschueren said today:

“It is some 6 years since Frans Timmermans launched the Commission’s new approach to better regulation, and we welcome Vice-President Šefčovič's updated communication on the subject.  Getting regulation right can be instrumental in creating new business opportunities and properly functioning markets. Getting it wrong can turn good ideas into legislation which does not deliver what it intended and possibly harms the people it aimed to help. That is why we believe that scrupulous and full consideration of the impact of legislation, not least on SMEs, and proper consultation of those likely to be affected by it, is essential to making regulation work as intended, and contributing to a competitive European economy.”

The Commission communication is an important step forward in making sure that legislation works as it should in underpinning important European policy objectives – not least in helping create a resilient, competitive EU economy which protects consumers and allows industry, not least the retail and wholesale ecosystem, to innovate and meet the significant challenges of digital and sustainability transformation, and thus provide rewarding employment to Europe’s citizens.

We have pointed to a number of areas which we hope that the revised better regulation agenda will help the Commission address effectively in the coming years:

• Properly designed and executed consultations, the results of which are considered fully and taken on board by the Commission, so that the proposed regulation works with how markets function and takes account of results already been delivered in the area.
• Coordinating the timing of consultations so that stakeholders are not confronted with too many exercises at the same time.
• Improving the quality of questionnaires to allow the Commission to have a full picture of how its proposal might work in reality, and help it design regulation which delivers the intended results effectively.
• Avoiding rushed proposals to meet a political objective which has not been sufficiently considered.  The old adage ‘hard cases make bad law’ points to the need to look for regulation appropriate in the wider context, and which is future-proof.
• Giving proper time for implementation, avoiding a situation which has arisen in a number of cases recently where necessary guidance and secondary legislation is not available until after the legislation has to be implemented. We have suggested that where such secondary legislation is foreseen, the implementation period should run from when that secondary legislation or guidance is actually published.
• Taking seriously the need to revise fundamentally even flagship legislation which has shown itself to have not worked as intended or created regulatory burdens disproportionate to its intended or actual effects, using the expertise in the Fit for the Future platform to help point to where such revision is urgently needed.
• Fully implement the SME Test in all legislation, ensuring that the impact of the proposal on small businesses least able to carry major regulatory burdens has been fully assessed, and the legislation adjusted. The appointment of the EU SME Envoy, part of whose role will be to filter new and existing legislation to ensure that it is SME-friendly, is long overdue.

None of this should slow the process of producing or adopting legislative proposals, but rather ensure that Europe has a regulatory framework fit for a challenging present and future global environment.

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11 associations and trade unions representing the European hospitality industry and its value chain warmly welcome this week’s discussions at EU level on the survival of the sector.

COVID-19 severely impacted the hospitality industry and its value chain, with establishments being forced to shut down at short notice as part of the collective fight against the virus and many workers being laid off temporarily or definitely. These hospitality businesses are part of the European social and economic fabric, bringing diversity and vitality to city centres, rural communities, villages and tourist areas across Europe, and providing millions of jobs. This is part of the European way of life, combining tourism, high-quality food, services and culture.

European Parliament Plenary this week: hospitality and tourism high on the agenda

It’s been a year since Commissioner Breton announced “A Marshall Plan for the European Tourism”. We appreciate the EU Institutions’ recognition of the massive long-term impact that the coronavirus pandemic has had on our industry and their will to further discuss strategies out of the crisis.” But much remain to be done. In particular, we warmly welcome today’s European Parliament Plenary meeting discussion on ‘Saving the summer tourism season – EU support to the European hospitality sector’, and tomorrow’s vote on the Digital Green Certificate, and look forward to the outcome of the debate.

Up next: continued support and EU funding still needed!

Earlier this year, we addressed a letter to the EU Institutions’ Presidents calling for the setting up of a hospitality Task Force to discuss the impact of COVID-19, and deliver a roadmap for the recovery. We still believe this to be essential to grant a faster and solid recovery. We welcome the answer of President Von der Leyen we received today who acknowledges the “vital role the hospitality industry plays for the local economy in our regions, cities, villages and tourist areas. Its contribution not only to the economy but also to our social and cultural fabric cannot be underestimated”.

Increased predictability for hospitality businesses, their workers and suppliers, the development at national level of clear health and safety protocols and dedicated financial and policy support to the hospitality value chain will also be crucial to ensure the sector becomes a motor for growth and employment again.

We believe this will be essential to grant a faster and more solid recovery.

On today’s EU Trade Policy Day, EuroCommerce Director-General Christian Verschueren commented :

“The COVID pandemic has hit the European and global economy hard. With some signs of Europe starting to see a slow return to normal life, the focus must now be on definitively beating the virus and building economic recovery. Some countries have reacted to the COVID crisis by erecting new barriers when all the experience shows that keeping trade open, whether within the EU single market or globally, is the best way to drive growth – and closing it down in a negative cycle of ‘beggar-my-neighbour’ is a guaranteed path to slowing recovery.”

The International Monetary Fund has recently shown that trade has already shown its ability to be an engine for economic recovery. Global trade volumes are expected to go up by 8.4% in 2021 and by further 6.5% in 2022. It is imperative that these encouraging figures will not be choked off by protectionist steps theoretically intended to support the economy but will serve the protection of a few sectors at the cost of the rest of the economy and consumers. Planned trade policy measures such as the carbon border adjustment mechanism or the anti-coercion instrument will need to be designed carefully to avoid acting as a brake on recovery and a trigger for protectionism more widely.

But the picture is far from rosy: importers and exporters are experiencing massive problems and increased costs by over three times - caused by a shortage of shipping containers and a drastic reduction in shipping capacity since the beginning of the pandemic. This is continuing despite global trade picking up. Importers and exporters are finding that booked shipments are often simply being ignored or very long waiting times to get a slot on a ship. We support our colleagues at CLECAT and other trade associations to ask the European Commission to look carefully at these developments and to ensure that these imbalances are addressed. The present system is imposing unreasonable costs on traders and consumers, and disrupting supply chains, with everyone having to wait longer for products coming by sea.

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Health and Food Safety Commissioner Stella Kyriakides spoke today at the launch of the EuroCommerce #sustainablecommerce website, which illustrates the diversity and scale of initiatives adopted by retailers and wholesalers to support more sustainable consumption and healthier lifestyles and encourage sustainability across the food supply chain in line with the Farm-to-Fork strategy.

EuroCommerce Director-General, Christian Verschueren, underlined the commitment of the sector to these objectives:

“Retailers and wholesalers welcome and support the direction set in the Farm-to-Fork Strategy. The sector has been a pioneer, leading the way on a whole range of initiatives to operate more sustainably, and encouraging customers to adopt healthier and more sustainable lifestyles. Achieving the Farm-to-Fork objectives will need the whole supply chain to be working together. Our members have been working with their suppliers to ensure the products they sell allow consumers to live a healthier and more sustainable life.We see this as an important starting point in a longer-term process and have asked the Commission to help create a structure for dialogue among all players in the supply chain.”

Retailers and wholesalers interact daily with millions of customers and, as COVID-19 has shown, play a central role in providing an essential service to Europe’s 450 million consumers. The Farm-to-Fork strategy will ultimately succeed if it is consumer-driven: a study by McKinsey and EuroCommerce showed that 50% of consumers planned to buy more healthy, local, or environmentally friendly foods in 2021. Affordability will also be important: 37% of consumers were looking to spend less on groceries, while 26% wanted both to save money on groceries while also moving towards sustainable lifestyles.  The #SustainableCommerce website demonstrates the importance of taking consumers along in this journey and collaboration across the whole supply chain to reach the strategy’s objectives and the need to. Cooperation and supply chain dialogue will also be essential in delivering on the Commission’s proposed code of conduct.

The website provides an insight of how business is making the farm to fork objectives a reality in line with their specific strategic focus and scale. It sets out in detail the initiatives and undertakings taken forward by retailers and wholesalers in three sections on 1) how our sector cooperates with farmers and other partners; 2) promotes sustainability and healthy lifestyles; and 3) supports sustainable practices. This builds on the sector’s strong track record as a pioneer in offering and promoting more sustainable choice, including organic, healthier choices with reformulated and ‘free-from’ products, measures taken to reduce our CO2 footprint, to limit the use of plastic and packaging more generally, and to minimise food waste.

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EuroCommerce welcomes the opportunity to provide comments on the European Data Protection Board’s (“EDPB“) Guidelines 02/2021 on Virtual Voice Assistants (the “Guidelines”). EuroCommerce appreciates the EDPB’s efforts to provide guidelines for Virtual Voice Assistants (“VVA“) with the aim to guarantee adequate privacy protection for users as the service is available for a vast majority of people when using for example their smartphones. In light of the foregoing, EuroCommerce believes that it is important that such guidelines remain sufficiently open and flexible so that they can take into account the specific characteristics of the different voice service architectures and the rapid technological developments in the VVA sector. In this regard, the legal framework should allow for use of VVA solutions in a way that is not to the detriment of digital innovation as well as European businesses’ competitiveness on the global market.

Below we summarise our key points and proposals and detailed comments which we hope will be helpful when finalising the Guidelines. We would be more than pleased to discuss these issues further with the EDPB should you have any questions regarding our comments.

Our key points and asks

• We ask the EDPB to (i) re-consider its reference to the applicability of the ePrivacy Directive in the Guidelines, or (ii) as a minimum, to provide that the relevant VVA actor (i.e. the data controller) should assess whether the ePrivacy Directive is applicable for its service. However, it is essential that the ePrivacy Directive does not by default apply for use of VVAs if the requirements of Article 5(3) are not met (please see section 1.1).

• We ask that the EDPB includes further examples of situations involving joint controllership in the Guidelines (please see section 2.1-2.2).

• We ask that the EDPB (i) revises its statement concerning the necessity to seek consent from the user, as it relies on an incorrect assumption and other lawful legal bases such as the performance of a contract or the pursuance of a legitimate interest under Article 6(1)(f) GDPR may be valid for data processing by voice service providers; and (ii) removes its reference to profiling as a purpose for data processing in para. 29 of the draft Guidelines as profiling merely is a means to an end, e.g. personalisation or marketing purposes (please see section 2.3).

• We ask that the EDPB revises its conclusion regarding service improvement purposes and consider Article 6(1)(b) of GDPR as an appropriate lawful basis (please see section 3).

• We ask the EDPB to revise its statement on the obligation to provide information under Article 12 GDPR to accidental users as Article 12 of the GDPR only sets out an information requirement with regard to intended processing. Moreover, in the event Article 12 of the GDPR should be considered applicable on accidental processing, we ask the EDPB to clarify the involved VVA actors’ responsibilities to inform accidental users (please see section 4).

• Please also see section 4 for additional comments in relation to specific paragraphs of the draft Guidelines.

Marking today’s publication of the draft EU Regulation on a European approach for Artificial Intelligence, Christian Verschueren, Director-General of EuroCommerce said:

”Retailers and wholesalers have been using artificial intelligence (AI) and automation technologies for many years to improve the service they can provide to their customers. AI can support faster deliveries, better predictions of demand, stock management, fraud detection, safer payments and help make our operations more sustainable. AI embraces a lot of different areas, and regulation needs to reflect that. The applications used by retailers and wholesalers carry little or no direct risks for individuals, as they focus on improving operational efficiencies and more personalised offerings. We are therefore pleased that the draft regulation concentrates on building safety and trust by particularly addressing higher-risk applications.“

In its contribution to the consultation on the Commission AI white paper published last year, EuroCommerce welcomed the inclusion of retail and wholesale among the safe sectors and highlighted the need to secure a future-proof framework to support innovative and competitive use of AI in Europe.  We are pleased to see that the draft regulation establishes an application-based AI framework and regulates those applications according to their intended use, i.e. on whether they will be used for internal business processes, decision tools, or uses which hold physical safety risks or other impacts on individuals. This is very much in line with the approach which we advocated in the consultation.

We also pleased to see the provision for sandboxing schemes to allow the development and testing of innovative AI systems under strict regulatory oversight to help businesses explore their potential and identify any drawbacks before they are placed on the market. Verschueren added:

“Our sector sees AI technologies as a prerequisite for Europe’s competitiveness and, in these uncertain economic times, also as a boost to economic recovery. With the added challenges of rapid AI developments outside Europe, a clear legal framework providing trust and certainty is vital for investment in AI technologies which can be accessible to all Europeans and based on European values.”

Commenting to the publication today of the review of the Non-Financial Reporting Directive and EU taxonomy rules, EuroCommerce Director-General Christian Verschueren said:

“The review of the Non-Financial Reporting Directive and the EU taxonomy rules offers a welcome opportunity to develop a harmonised methodology and standards in this important area. European retail and wholesale have long supported, and committed to help drive, the green economy. We have also consistently stressed the need for this to be based on science, and to use comparable methodologies.  There is much expertise already out there internationally, and we will be pressing for the European approach to be aligned closely to existing, globally-recognised international standards and guidance.”

Sustainability is a daily reality for the retail and wholesale sector.  Consumers, not least since the COVID pandemic, are looking to ensure that what they buy is produced sustainably and ethically.  Retailers and wholesalers across Europe have already committed to ensure that their purchasing and operations support this, and, in close cooperation with their suppliers, have published wide-reaching strategies for achieving these objectives. In line with this, we strongly support effective and appropriate tools to ensure that consumption fits our planet’s resources.

Sustainability is global, and so are the complex supply chains on which our rector relies.  Hence the importance of harmonised standards and methodology in Europe, but also of Europe not going it alone, and instead building on the expertise and standards developed internationally in, for example, ISO 26000 and the OECD guidance.

The Commission proposal extends the scope and coverage of companies obliged to disclose sustainable information, hence increasing the number of companies covered. Our sector is dominated by SMEs, but also by companies serving diverse markets and customer needs.  Success in achieving the sustainability objectives of the legislation will lie in its ability to create the right balance between a harmonised framework and allowing sufficient flexibility for small players to contribute to those objectives in a way best suited to their capacity to do so.