The law prohibiting unfair retail conditions in the food supply chain should improve the position of domestic food producers compared to retail chains
Deputy Agriculture Minister Krunoslav Karalić said the law being prepared by his Ministry is in the draft phase, has the goal of bringing order to the market and the expected effect is a better market position of local food producers, Tportal.hr reported on July 7, 2016.
“The main goal of the law is to prevent the abuse of the dominant negotiating position in the food supply chain and enforce fair trade relationships in that chain. With this law we also want to sanction unfair imposition and transfer of costs from one side of the chain to another, but also to sanction the unfair breach of contract in that chain, as well as unjustified fees for certain inexistent services,” Karalić said.
He also listed on of the most important segments is the sanctioning of the sale of products below their purchase price with VAT. According to him, the law primarily brings order to the market and a system already in place in 20 EU member nations, with the final effect of a more favourable position of domestic food producers, while their competitiveness will be solved with other measures.
Deputy Economy Minister Željko Pravdić pointed out Croatian food producers found themselves in additional problems due to the embargo on Russia when European food stockpiles began to overspill to countries less organised in that segment.
He believes Croatia did not use this opportunity since entering EU, with retail chains still dictating almost all market conditions, from product placement to everything else.
Representative of the Croatian Agriculture Chamber Mato Brlošić do we know how old the meat being imported at low prices is, while at the same time our producers cannot market their quality products.
“Something must be done immediately to protect our production, as most EU states have,” Brlošić said, who also has a problem with import of milk, or a milk mixture of bad quality.
“We are not against importing meat up to two months old, or fresh quality milk, but we are witnessing the placement of low quality products,” Brlošić stated.
Representative of Cromilk Rašeljka Maras also feels the new law should reduce the import of products at dumped prices. According to data she presented, the import of milk to Croatia since EU accession has grown by 40%, with milk imported at dumped prices.
President of the Vegetable Producers Alliance Hrvoje Gregurić complained producers were not consulted about eh draft and asked why the state allows for the import of peppers of doubtable quality from Serbia or potatoes from Cyprus.
He is more content with cooperation with foreign retail chains than domestic ones.
“Croatian households spend a third of their income on food, significantly more than households in developed Europe,” Božica Marković of the Croatian Agriculture Chamber stated, while most objections to the draft came from Agrokor’s executive director for agriculture and representative of the Croatian Employers Union Goran Pajnić. According to him the new law would bring producers new trouble.
President of the Market Competition Protection Agency’s Council Mladen Cerovac feels small and medium domestic food producers, due to a low bargaining power, are currently subordinate to retailers and the new law might level this.
