The European Parliament has adopted new the EU Directive on Unfair Trading Practices in the Food Supply Chain to rebalance power among farmers, food processors and retailers. The Directive forbids certain commercial practices such as late payments for perishable food products or last-minute order cancellations. Third countries’ businesses must comply with the same rules as European companies.
The Directive, which was officially adopted on March 12, 2019 expressly prohibits 16 unfair trading practices: 10 “black practices” are prohibited whatever the circumstances and 6 “grey practices” are allowed if the supplier and the buyer agree on them beforehand in a clear and unambiguous manner. Unfair trading practices to be banned include late payments for perishable food products, last-minute order cancellations, unilateral or retroactive changes to contracts, forcing the supplier to pay for wasted products, refusing written contracts, misuse of confidential information; and threats of retaliation against suppliers.