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The Supply Chain Initiative (SCI) published its annual report for the year 2018 today. The results of the annual survey of registered companies showcase that the SCI continues to make progress in the promotion of fair business practices in the food supply chain as a basis for commercial dealings.
 
The Supply Chain Initiative (SCI) annual report 2018 contains the results of the annual survey of registered companies, highlights its dispute resolution mechanism and points out the work of national platforms and initiatives. Overall, satisfaction with the SCI remains high among registered companies with a commitment to promote and respect the SCI Principles of Good Practice.
 
The survey results indicate that 9 out of 10 companies trained all or part of their staff members on the Principles. Since their registration 84% of the registered companies communicated their adherence to the SCI to their business partners at national and/or group level. Companies considered that the SCI has helped them to improve daily communication with their trading partners (43%), improve their internal company processes (24%) and deal with disputes (21%).
 
“Our primary purpose is to promote fair business practices throughout the food supply chain as a basis for commercial dealings. We also aim to ensure that companies can lodge complaints without fear of retaliation, and are able to resolve their issues and disputes in a quick and efficient manner. The results of the 2018 annual survey confirm that we are moving in the right direction. Only 3% of companies expressed a fear of retaliation and 69% of respondents indicated they were satisfied to very satisfied with the SCI,” says Michael Hutchings, SCI Chair.
 
The dispute resolution mechanism is a key pillar of the work of the SCI and allows companies to lodge an aggregated dispute with the Chair in full confidentiality, provided there is a cross-border element and the issue could not be resolved at the national level. In 2018, disputes were reported and dealt with exclusively at the national level with 20 companies having been faced with an alleged breach of at least one of the Principles of Good Practice since 20 November 2017. 16 companies resolved the issue informally. Four companies were not able to solve the issue informally, as a result of which 1 company lodged three complaints.
 
“There is a wide range of national platforms and initiatives based on the SCI model or who have taken into account the SCI Principles of Good Practice. The report highlights the dispute resolution activities of the Belgian, German and Finnish models as examples of good practice. I am encouraged to see how effective their respective dispute resolutions at national level are, which is where the impact of our work is most visible,“ concludes Michael Hutchings.

Speaking after the approval of the EU-Singapore Trade and Investment agreements by the European Parliament today EuroCommerce Director-General Christian Verschueren said:

“Singapore evolved from a developing country to one of the most sophisticated and prospering economies in Asia within one generation. This success story can be put down almost entirely to Singapore’s unequivocal commitment to free trade. The European Parliament’s approval today opens a further avenue for mutual benefit through open and free markets, and confirms the EU as a promoter of the world trading system where important partners seem to be turning away from it.”

Singapore is by far the EU's most important partner in the ASEAN group. Total bilateral trade in goods in 2017 was over 53 billion euro and a further 44 billion in services in 2016. Over 10,000 EU companies are established in Singapore to serve the whole Pacific region. The trade agreement with Singapore will remove nearly all remaining tariffs on EU products, simplify customs procedures and set high standards and rules. The Free Trade Agreement simplifies trade in goods like electronics, food products, alcoholic drinks and pharmaceuticals, and opens up the market for various services.  It is complemented by a separate agreement, also approved today, covering investment.

Both agreements still need a final sign-off from the Council, allowing the trade agreement to enter into force. The investment treaty will need also to be ratified by national parliaments.

Verschueren concluded: “Today’s approval by the European Parliament creates a solid bridge for trade with the booming economies in the ASEAN group. We are keen to see the Council follow suit in ratifying the trade agreement quickly, so that it can enter into force and benefit the European economy, and that national parliaments give the investment treaty priority to give additional certainty to European companies keen to invest in the region.”

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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 today after agreement in trilogue negotiations on the Regulation on Transparency and Sustainability in the EC Risk Assessment Process, EuroCommerce Director-General Christian Verschueren said:

“Retailers and wholesalers in Europe support the work of the European Food Safety Authority (EFSA) in its role as the independent European voice for food safety. Ensuring that the food we sell is safe and maintaining consumer trust is central to our business. EFSA provides a vital scientific reference for us in our concerted efforts to prevent unsafe food products entering the market and harming consumers.”

The added transparency this regulation will provide for is a welcome step in underpinning consumer trust in the food they buy. It also acknowledges the need for better communication about risk, which is very important for maintaining consumer confidence and improving their perceptions of risk. Past food crises, such as with fipronil and eggs in 2017, showed serious shortcomings in how quickly a risk was communicated and how the responses were coordinated between national and EU authorities, and with key stakeholders in the supply chain. The agreement today needs to lead to clear and coordinated messaging when problems arise.

 Verschueren added:

“In these times when unfounded or alarmist statements on social media can cause consumers real concern and confusion, it is paramount that we can all respond quickly with clear and accurate information. All parts of the supply chain, particularly retailers who are in the front line in dealing with consumers, need to be kept in the loop. EFSA has been successfully piloting improved transparency for some years, and the Commission needs to make sure that this is extended fully to the decision-making process. Stakeholders, in particular food businesses, should be able to provide informed views on how best to develop and implement new rules.”

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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 today at the conclusion of trilogue negotiations between Council, European Commission and Parliament on the Compliance and Enforcement Regulation, EuroCommerce Director-General Christian Verschueren congratulated the negotiators on finalising this important new regulation for consumers and all the supply chain:

“We are pleased to see agreement to a regulation which will help prevent serious harm to consumers, and allow law-abiding operators to compete on an equal footing. This will send a strong and positive signal to support traders’ efforts to bring safe and compliant products to the market. Rogue manufacturers and traders do not have a place in the EU market and dangerous products even less so.”

Retailers and wholesalers in Europe are particularly happy that negotiators have reached agreement on a text for the Regulation which can now go forward for adoption.  We have been waiting for this step for a long time, allowing effective market surveillance to protect consumers. It removes a major distortion of the market for EU retailers and wholesalers who apply the rules, and yet have seen dangerous products, sold online and imported direct by individual consumers, passing under the radar.

Verschueren concluded:

“In recent years, and particularly with the explosive growth of shipments by Chinese online sellers, bona-fide EU traders have been faced with competition from unscrupulous non EU-manufacturers and traders selling dangerous products straight to EU customers by passing controls by market surveillance authorities. The agreement reached today will allow the authorities to enforce the regulations in relation to such products by having a responsible person in the EU with whom to deal”.

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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 has lodged two complaints to the European Commission against a new tax on retailers (Act No. 595/2003). The tax, which applies only to foreign-owned companies active in the country, requires them to pay 2.5% of their net turnover, from which the Slovak government expects to raise €87 million. It entered into force on 1 January this year.

The EuroCommerce complaints focus on its clear view that the tax is incompatible with EU law on two counts. By exempting virtually all Slovak-owned retail chains, the tax constitutes unlawful state aid, similar to retail taxes previously proposed in Poland and Hungary, and subsequently found illegal by the Commission. Secondly, the discriminatory nature of the tax infringes the clear Treaty principle of freedom of establishment.

Commenting today, EuroCommerce Director-General Christian Verschueren said:  
“International retail companies have invested billions of euros in offering Slovak consumers modern, competitive supermarkets with a wide range of quality products. Despite this, Slovak legislators consciously chose to focus on foreign-owned retailers, and to exempt virtually all Slovak competitors, with the clear objective of deterring foreign investors. This deliberate move will unavoidably mean less choice and higher prices for Slovak consumers.”

“This law is part of a wider and growing trend of protectionism and populist policies against retailers, especially in Central and Eastern Europe. These Member States are seeking to control the way our members do business, restrict what they sell, and levy disproportionate fines. This is all aimed at protecting local competitors and driving out foreign companies. These countries benefit greatly from the single market, yet want to disapply it when it suits them politically.”

The political debate preceding the new tax law made it very clear that politicians were specifically trying to target foreign players. EuroCommerce has asked the Commission to act quickly in order to limit the damage to consumers and businesses, and to open an in-depth investigation, meanwhile suspending application of the law under EU state aid rules. 

Verschueren added: 
“Retail is a low margin business. Grocery retailers’ margins are typically less than 3%. A 2.5% tax on turnover therefore wipes out their profits, and forces them into making a loss. This will inevitably have significant consequences for future investment in the country.”
 

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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   

Commenting on the entry into force today of the EU-Japan Economic Partnership Agreement (EUJEPA), EuroCommerce Director-General Christian Verschueren said:

“A new era of dialogue, cooperation and trade between the EU and Japan has started today. This agreement covers no less than one-third of the world’s GDP, getting rid of customs barriers and other unnecessary restrictions while safeguarding consumers with high standards.”

The EU-Japan is the largest trade and economic cooperation agreement ever concluded in terms of market size. It abolishes some 97% of the tariffs on the EU's exports to Japan and substantially liberalises all the others through tariff-rate quotas or cuts in tariffs. The EU’s annual exports in goods to Japan are currently worth more than 58 billion euros, with a further 28 billion euros accounted for by services exports. The European Commission estimates that the agreement will save EU exporters around 1 billion euros in customs duties alone every year, quite apart from the economic boost that closer ties with the world’s third largest economy will bring.

The agreement will remove duties on many cheeses currently subject to tariffs around 30% and on wines which pay 15% on average. Much processed meat will now be duty-free and tariffs on fresh meat reduced to almost nothing. The agreement also opens the Japanese market for financial services, e-commerce, telecommunications and transport. The EU is removing 99% of its customs duties, helping also to reduce prices of Japanese imports for consumers in Europe. The agreement also removes limitations on establishment, subject to national regulation, as long as this does not discriminate between European or Japanese companies. 

In parallel to the agreement, the Commission has issued a data protection adequacy decision. This finds that Japan provides an equivalent level of data protection as in the EU, and allows free flows of personal data between the EU and Japan. This is accompanied by an equivalent decision by Japan, which means that companies will have the right to move data in both directions. EU citizens’ complaints over any infringement of their privacy rights in Japan will be managed by the Japanese data protection authority.

Verschueren added:

“The Japanese economy is among the most digitalised in world. Closer ties with Japan will help the European retail and wholesale sector in their ambitions to bolster their position in the global digital market. This agreement is good news for consumers and a welcome positive contribution to growth in both our markets.”

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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   

Eurofound¹ has just reconfirmed EuroCommerce as the sole social partner for the commerce sector at the European level. Welcoming this announcement, EuroCommerce Director-General Christian Verschueren said:

“We are proud to represent our sector in the European social dialogue, and more broadly in promoting the interests of a sector which provides jobs for 29 million Europeans, and one in five of young people employed in Europe. We are pleased that Eurofound has recognised our commitment to social dialogue and reaffirmed EuroCommerce as ‘the only European employer organisation capable of representing the entire European commerce sector’.”

The Social Dialogue between EuroCommerce and UNI Europa has functioned continuously since 1983 and was officially recognised by the European Commission in 1990. Every seven years, the Eurofound conducts a Representativeness Study to assess to what extent EuroCommerce and UNI Europa represent the retail and wholesale sector and have the capacity to negotiate agreements.

The Eurofound study underlines the important role of retail and wholesale as employers but also points to some of the challenges arising from changes in consumption patterns, the rise of e-commerce, skills needs and the impact of the financial crisis. EuroCommerce has been working closely with our social partner UNI-Europa in addressing the social impact of these developments. Verschueren added:

“I would like to take this opportunity to thank our social partner UNI Europa for their constructive approach to tackling a number of difficult issues over the past seven years. We look forward to continue our positive cooperation in preserving the European social model and accompanying the changes happening in our dynamic retail and wholesale sector.”

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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   

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[1] The European Foundation for the Improvement of Living and Working Conditions (Eurofound) is a tripartite European Union Agency, whose role is to provide knowledge in the area of social, employment and work-related policies. Eurofound was established in 1975 by Council Regulation (EEC) No. 1365/75 to contribute to the planning and design of better living and working conditions in Europe.

Today’s agreement in the Council on the directive on the reduction of the impact of certain plastics products on the environment sends a clear signal on the need to ensure that plastics can no longer be wasted. The retail and wholesale sector supports regulators’ attempts to fight damaging plastics pollution, and is already acting to reduce plastics use, but continues to have strong doubts on the whether the waste and litter management systems suggested in the final compromise will work.  These concerns are centred in particular on extended producer responsibility for cleaning up litter and paying for the infrastructure and operation of collection systems.

EuroCommerce Director-General Verschueren commented:

 “Our sector’s commitment to sustainable use of plastics is absolutely clear, and we will continue to do all we can to respond to our customers’ demand for safe and sustainable products. We will of course observe the legislation, but must warn that there are elements which expect retailers to take responsibility for issues such as littering over which they can only have limited influence.”

Retailers and wholesalers have actively engaged in decreasing the volume of plastics used in their stores and throughout the supply chain in order to reduce the impact of plastics on the environment. A number of our members have directly made pledges on plastics reduction with the European Commission, and others committed through other platforms such as the Ellen MacArthur Foundation or under the Consumer Goods Forum.

In concrete terms, these commitments mean the absolute elimination of unnecessary single use plastics items, higher levels of recycled content in their products, as well as the use of innovative modes of sales to reduce packaging such as “natural branding”, with this being printed directly on the peel of fruit and vegetables with a laser instead of using a plastic sticker.

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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   

Retailers and wholesalers reacted to the outcome of the trilogue negotiations on the UTP directive today, which will impose new administrative burdens and legal uncertainty on retailers, shifting the balance of power to food manufacturers. Speaking today, EuroCommerce Director-General Christian Verschueren warned of the consequences of these actions for the supply chain and for consumers:

“The amendments agreed today are claimed to be protecting the weak against the strong. This is frankly disingenuous. It skews the market yet further in favour of national brands who already have considerable power. In countries like Ireland, Belgium, and Sweden, the upper limit of 350 million now agreed covers almost all manufacturers. This means all retailers, including small shops, will come under more pressure, from manufacturers who will be able to impose higher prices. These amendments fly in the face of the Commission’s own impact assessment of the harm that extending the scope beyond farmers and small suppliers would do. They also ignore entirely the concerns expressed by BEUC on behalf of consumers. ”

We will need to study closely the final text, but the addition of 8 further prohibitions – bringing the total up to 16 – is an unprecedented intervention in the free market. It gives additional power to manufacturers, and no rights to retailers or wholesalers. This is an odd interpretation of fairness.

Verschueren concluded:

“This was supposed to be a directive to protect farmers. All the changes to the text have more to do with negotiations between food manufacturers and retailers. What has this got to do with farmers? How will it guarantee them fairer prices for what they produce?”

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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   

Key messages

EuroCommerce is the voice for six million retail, wholesale, and other trading companies in Europe. Our association has a key interest and role in Urban Mobility as we deliver products to a wide range of local economic operators and consumers.

In this perspective, EuroCommerce would like to emphasize the

• close link between urban mobility and transport, and the importance of setting up an efficient and sustainable urban transport system in the EU
• important role of commerce in cities to be recognised, and for the accessibility and delivery of goods to be ensured
• increasing role of transport, especially in times of expansion of the digital economy, transport continues to plays an important role, especially as customers ask for more personalised delivery.

In background, EuroCommerce

• advocates for consistent and harmonised approach at national levels to the implementation of urban mobility plans
• calls onto the local, regional, national and European authorities to recognise that:
• access to city centres is essential for the attractiveness of cities;
• any sustainable urban development plans (SUMP) should reinforce the efficiency of our operations by recognising the initiatives led by our sector.
• tailor-made solutions at local and regional level are needed
• requests that freight transport receives the attention it deserves and be put on an equal footing with the other components defining urban transport (ie. passenger transport)