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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

Following today’s publication of the Commission proposal on single-use plastics, the retail and wholesale sector reiterated its commitment to promoting the circular economy and tackling plastic waste. The sector has already demonstrated its leadership in reducing packaging and single-use plastics, following a number of 3R (reduce, reuse, recycle) strategies, and made collective and individual commitments on doing so, including an 80% reduction in overall waste.

Long before the Commission’s regulation on reducing the use of plastics, retailers have taken proactive measures to cut their reliance on plastics. These include encouraging customers to collect and return their plastic waste, increasing their share of recycled products and carrier bags made of renewable plastics, and encouraging reduced-packaging refills of bodycare products. The effectiveness and success of such initiatives have been closely monitored by an independent operator under the umbrella of the European Commission and is collected in the REAP database.

In addition to these measures, the sector is also engaged in supporting behavioural change through awareness and information campaigns. For instance, some of our members have released information to facilitate waste sorting by their customers for nearly 14,000 food and non-food products.

EuroCommerce welcomes Europe’s leadership in promoting the transition to a circular economy. Preventing harmful environmental impacts of single-use plastics is an important step on that journey. Retailers and wholesalers are already, and want to in the future, play their part in combating littering, but this needs to be shared among all stakeholders, from producers to consumers. The sector is in the middle between producers and consumers, and collection, recycling and cleaning of litter cannot be its responsibility alone. EuroCommerce has questions on the practicality and impact of some measures. One must look hard at questions of extended producer responsibility, hygiene, safety and convenience.

EuroCommerce Director-General, Christian Verschueren, said:

“Extended producer responsibility must not mean supermarkets ending up as waste collectors. We can act as an enabler of sustainable behaviour for our many million customers, but other players, including many industries and government, have to step to the plate as well.” 

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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 consider farmers as key partners in the food supply chain and support measures which can directly address the problems farmers face. A critical mass of retailers are already applying EU principles of good practice in B2B relationships under the Supply Chain Initiative (SCI). Legislation at EU level will not create a level playing field and risks undermining EU principles of freedom of contract and free market economy. We ask the Parliament and Council to strictly apply the principles of subsidiarity and proportionality, so as to preserve national schemes that work well. The scope of the proposal should be unambiguously focused on, and limited to, small farmers and processors. Here are the reasons why.

Retailers and wholesalers have put considerable investment and effort into complying with the GDPR to ensure that shopping, whether online or offline, will respect consumers’ right to privacy. These efforts will not end after today, when the General Data Protection Regulation (GDPR) takes full effect.

All companies, whether large or small, based in the EU, but also, depending on the customers they serve, outside the EU, have a legal obligation to apply a set of complex data protection rules as of today. Retail and wholesale companies have been impacted by this Regulation in almost every area of customer data processing. Companies with storefronts, websites, mobile apps or other digital platforms through which they serve customers face new compliance standards, additional administrative burdens and liability for violations, as well more stringent enforcement and penalties. EuroCommerce issued in 2017 a guide “The new EU Data Protection Rules - A Guide for Retailers” aimed at helping its members in ensuring customers’ privacy. The guide is currently being updated to take into account new insights and guidance from the authorities.

EuroCommerce Director-General, Christian Verschueren, said:

“The implementation of the GDPR has required a significant compliance effort on the part of most retail and wholesale companies. With the GDPR, companies must take more responsibility for how they process and share personal data. Rather than being seen only as onerous compliance, the GDPR provides a unique opportunity to improve customer relations by boosting consumer trust and demonstrating responsible and transparent data treatment. While GDPR will continue to pose challenges in its interpretation and application, at the same time it can help companies become more secure and trustworthy, thus creating a win–win for business and customers.”

The implementation process will continue as the retail sector still seeks how best to implement some of the GDPR provisions in critical areas of retail operations, such as improved customer service activities, managing databases and loyalty programmes, collecting consents and honouring customers’ rights for deletion or portability. We call on the national privacy regulators to also reflect on the sector-specific context when they interpret and enforce the GDPR provisions.

Yesterday, EuroCommerce and the National Retail Federation (NRF) released a joint paper that addresses operational challenges that retailers both in the US and in Europe face as they implement programmes to comply with the GDPR. Retailers want to comply, while at the same time, continue to provide customers with personalisation and seamless multichannel experiences.

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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 National Retail Federation and EuroCommerce today released a paper that addresses operational challenges retailers in both the United States and the European Union face as they implement programs to comply with new EU data protection regulations while continuing to meet consumers’ expectations for customer service.

“There are still many questions about how the GDPR applies to critical areas of retail operations,” the paper said. “Retailers must find appropriate methods for GDPR compliance that further their customer relationships and do not frustrate them.”

The 14-page “Retail Approach to Implementing Critical Elements of the GDPR” said retailers want to find “approaches to compliance that will meet the requirements of the GDPR while ensuring that retailers can continue to provide customers with the personalization, omnichannel experiences and seamless retail operations that they expect.”

The General Data Protection Regulation, which takes effect on Friday, sets out changes to almost every area of customer data processing. Retailers with stores, websites, mobile apps and other digital platforms serving consumers will face new compliance standards, increased liability for violations and more stringent enforcement.

While the GDPR is European legislation that affects retailers headquartered in any EU country, it also covers companies from countries around the world that have stores in Europe, target sales to Europeans over the internet or through mobile apps and other remote commerce channels, or simply track European consumers online. 

"These are European rules but they have significant implications for many U.S. retailers,” NRF President and CEO Matt Shay said. “This effort will help inform EU regulators as well as retailers on both sides of the Atlantic about an effective retail approach to compliance with critical elements of the GDPR. It is particularly important for U.S. companies that might not be fully versed in the EU’s new privacy requirements. In the world’s growing global economy, U.S.-based retailers’ consumer privacy and data security programs increasingly need to reflect worldwide obligations, not just national or state requirements.”

The paper released today was first envisioned in a 2016 NRF-EuroCommerce meeting in Brussels organized to share views on GDPR compliance among member companies, and the two associations reached agreement last year to develop the joint document. Topics covered include consumers’ right to data erasure and data portability, consent and legitimate interest as legal grounds to process customers’ personal data, data breach notification rules and customer profiling requirements.

“Protection of consumers’ data is a top priority for retailers around the world,” EuroCommerce Director-General Christian Verschueren said. “We are pleased to be working with our U.S. counterparts to ensure that Europeans and Americans alike can be confident about the protection of their data, helping our members understand these new rules, and how to deal with them.”

The paper will be shared with the data protection authorities in the 28 EU member states to make them aware of retailers’ efforts to ensure GDPR compliance while meeting consumers’ expectations to process data responsibly and seamlessly when serving them.

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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

NRF - +1 202 783 7971 – press@nrf.com

Digital technology has driven a major change in the way people buy, but the way people buy has also transformed the way retail and wholesale do business. Digitalisation is transforming the competitive landscape of our sector in many ways. The distinction between online and offline, and between manufacturers, wholesalers and retailers are becoming blurred. Digitalisation has brought about massive changes in supply chains, increasing transparency but also competitive pressure. Platforms have created new business models. Data and the ability to use data gives a competitive edge and will increasingly do so. These were the topics discussed this morning at the EuroCommerce roundtable Retail competitiveness in the age of digitalization, which took place during the European Business Summit.

EuroCommerce Director-General Christian Verschueren said:

“While most European retailers and wholesalers are still heavily dependent on their national markets, and few operate on a significant global scale, they face intense global pressures: online players from outside Europe are building up their market shares, with some direct imports operating outside many of the EU’s rules on product safety or taxation. Regulation should help the transition of the retail and wholesale sector, and seek to establish a level playing field among operators and channels of distribution. Equally, we need forward-looking policies to ensure Europe is able to embrace and maintain a leading role in emerging technologies, including artificial intelligence and blockchain, which will have a further impact on our sector.”

Irmfried Schwimann, Deputy Director General, DG Grow, European Commission, added:

“Retail is one of the biggest sectors in the EU economy, generating 4.5% of EU value added, and providing 9% of all jobs. EU households spend up to one-third of their budgets in retail shops. Retail is also a major driver for innovation and productivity. Through its interactions with other economic sectors, a better performing retail sector can trigger positive spill-over effects for the entire economy. But the sector has been lagging behind in productivity in comparison with other business sectors. Digitalisation provides the opportunity for the sector to perform better. The Commission’s recent communication guides public authorities on how to increase innovation, productivity and competitiveness of the retail sector. This will allow European retailers to strengthen their global presence. The Guide the Commission published in parallel should help SMEs in their efforts to embrace digitalisation."

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For further information, please contact:

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

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

Speaking to mark the launch of the Benelux study on territorial supply constraints, EuroCommerce Director-General Christian Verschueren argued for the EU to act on big brands’ fragmentation of the European market:

“The Benelux study just published provides further evidence of a worrying trend for all those who care about the single market and the interests of consumers. Big brands are breaking up the single market, using their dominant position to force retailers and wholesalers to buy products only in the country in which they operate; and they are doing so to maximise their already considerable profits at the expense of consumers. This is a little-known issue which needs to be addressed as a matter of urgency.”

The Benelux study looks at the restrictions enforced by suppliers of products on retailers, preventing them from sourcing centrally or buying in the country of their choice. It shows that 77% of retailers asked saw territorial supply constraints as raising prices for consumers, and 67% as restricting their ability to offer their customers the full range of products the brands sell elsewhere. The study demonstrates with concrete evidence the prevalence of territorial supply constraints and their impact on retailers and consumers. It also notes that such restrictions are particularly imposed by dominant, often multinational suppliers, for whom the EU market only represents a small percentage of their global turnover.

This Benelux report could act as an important pilot for further EU action, following a Commission communication on the European retail sector, produced last month. This highlighted the problem of territorial supply constraints as one to be further investigated.  This is in parallel with the current Commission investigation of the practices of ABInBev in partitioning the Belgian and Dutch markets and their compatibility with EU competition law.

 Verschueren added:

“Large multinationals operate on a global scale and sell freely across Europe, yet partition national markets to prevent retailers using the single market to get the best prices and best products for their customers. This contrast between manufacturers exploiting the full benefits of the single market for themselves, and restricting it for retailers, is costing consumers millions of euros every day. We will be working with the Commission and our national members to see this change, and change soon.”

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For further information, please contact:

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

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

Digitalisation is transforming retail and wholesale. Our sector employs 29 million Europeans, and offers a valuable entry point into the world of work for no less than 1 in 5 young people. European e-commerce saw 14% increase in revenue in 2017 and in the same year, as an EU average,57% of consumers purchased online at least once. The future of retail and wholesale and how innovation is crucial for businesses to survive in the digital age were the topics of the inaugural EuroCommerce Digital Lecture which took place today in the margins of the European Business Summit.

On the occasion of this inaugural lecture, Kenneth Bengtsson, President of EuroCommerce, said:

“The digital revolution is changing the way people live, what they buy and how they buy it. Our sector is used to an ever-changing landscape of competition and consumer demand, and reinventing itself to meet those challenges. But the rate of change has accelerated and will continue to do so. This is why we dedicate our first EuroCommerce Digital Lecture to the topic of innovation.”

Martin Wild, Chief Innovation Officer of the MediaMarkt-Saturn Retail Group, and the keynote speaker of the Lecture, commented:

“The speed of digitalization keeps accelerating and it’s important for us to stay ahead. As customer experience and convenience are crucial, we, as retailers, have to innovate, experiment and get customer feedback fast. Retail in the future will include robots guiding us, augmented and virtual reality merging on- and offline worlds to create an all-new shopping experience, and artificial intelligence will help to hyper-personalize the customer experience. To support the crucial need for innovation, we created the international accelerator Retailtech Hub. It provides start-ups focused on retail-innovation with a platform to connect with established corporations.”

Christian Verschueren, Director-General at EuroCommerce, added:

“Forward-looking policies should help the transition and seek to establish a level playing field among operators and channels of distribution. It should also entail retailers and wholesalers to ensure they are able to embrace emerging technologies, including artificial intelligence and blockchain. We also need a dedicated programme to help SMEs adopt the new technologies and have access to the expertise needed to go online. In this regard, we praise the recent Commission guide for revitalising the small retail sector and the efforts to support the transition. Equally crucial is working with educational and vocational training systems to ensure that young people and workers are equipped with the skills needed in the digital economy.”

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For further information, please contact:

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

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