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Agriculture and Food

Overview

EU competition rules apply with certain exceptions to the agricultural sector: to farmers, associations of farmers, producer organisations, cooperatives, and interbranch organisations, among others.

The sector specific rules can be found in Regulation 1184/2006 and Regulation 1234/2007, known as the "Single Common Market Organization (CMO) Regulation".

Agriculture is changing rapidly due to globalisation and technological innovation. The reform of the Common Agricultural Policy (CAP) will take place by 2013.

This reform aims to prepare European farmers for the challenges of increasingly open markets and international competition, so that they can continue to feed Europe and the world.

One of the CAP's aims is to keep effective competition on the markets for agricultural products to ensure reasonable food prices for consumers. The European Commission's competition department works to ensure that all legislative proposals contribute to making agricultural markets more competitive, and will not have anti-competitive effects that could harm market operators and ultimately, consumers.

The Competition department also enforces the competition rules that prohibit restrictive agreements and abusive conduct by dominant companies on agricultural markets, in parallel with national competition authorities. The Commission has also adopted a number of merger decisions relating to mergers in the agricultural sector.

The Commission’s department for competition does not deal with state aid in the agricultural sector. This is handled by the department for agriculture, which is active in the control of state aid to the production, processing and marketing of agriculture products.

Recent advocacy actions in the agriculture sector focused on measures proposed by the High Level Group on Milk to limit competition in milk markets. This included a brochure which explains how co-operation between farmers can be strengthened without the need for derogations from competition rules. More recently, the European Competition Network (ECN) has published a Report on the activities of competition authorities in the food sector. The report provides detailed information and findings on how competition works in the food sector on the basis of the most recent enforcement and monitoring actions undertaken by national competition authorities and the Commission in this area.

Retail study

The European Commission has ordered a study to assess the impact of recent developments in the European retail sector on consumers. Following calls by stakeholders, the study will examine, in particular, whether increased concentration (of retailers/food manufacturers) or other factors (such as shop type/size, private label success, socio-demographic characteristics) have hampered choice and innovation in the European food supply chain.

The tender for the study has been awarded to the consortium of Ernst & Young, Arcadia International and Cambridge Econometrics. The first results will be available to the Commission in Autumn 2013, and a final report will be made public early in 2014. The Commission will then evaluate the results and may put forward proposals to improve the functioning of European food markets.