RGDATA Raises Serious concern over proposed EU measure on Unfair Trading Practices
Dublin. 16 October 2018
Irish consumers will face less choice, reduced competition and ultimately higher prices for food if a draft EU measure banning co-operation between independent retailers on joint purchasing of goods and services from suppliers is implemented.
The new measure, Business to Business Unfair Trading Practices in the Food Supply Chain (2018/0082(COD)) which was proposed by the EU Parliament Agriculture Committee earlier this month would effectively ban the business model which services the independent retail grocery sector in Ireland. This sector currently accounts for over 30% of the retail grocery sector in Ireland. As currently drafted the measure would prohibit independent retailers from concluding supply agreements with symbol groups or other wholesale alliances.
Tara Buckley Director General of RGDATA, the representative association for 3,500 independent family owned shops, convenience stores and supermarkets throughout Ireland, said that this proposed move would seriously undermine the independent retail grocery sector and lead to a market dominated by the international multiple chains. Banning joint purchasing agreements by independent retailers will also strengthen the already concentrated market position of large suppliers, many of whom wield excessive market power already.
“Independent, family owned shops and supermarkets provide competition, choice and value in the Irish retail grocery market. They are the beating heart of Irish towns, villages and communities, the best supporters of Irish suppliers and ensure that consumers have a range of retail choices in every community throughout Ireland and provide an essential counterbalance against the market power of the larger multiples and food suppliers. Banning joint purchasing by independent retailers will harm consumers, damage choice and ultimately lead to a more concentrated retail grocery market in Ireland.”
RGDATA is calling on Irish MEPs, to resist the proposal and will be urging the Irish Government to campaign against the proposal given its hugely harmful impact for the independent retail sector in Ireland.
Tara Buckley continued;
“Ireland’s membership of the EU has brought many benefits. However this is one proposal which will be absolutely counterproductive in its impact on consumers and SMEs in Ireland. It will lead to less competition, fewer independently owned grocery shops, less choice and ultimately higher prices for consumers. We will be urging the Irish Government and Irish politicians to resist this measure and ensure it does not become part of EU law. There is no upside to this proposal for Irish consumers, farmers or SMEs.”