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On Thursday, Rural Affairs Minister Jennie Nilsson introduced the bill on fairer conditions in the food sector.
– The purpose of the law is to deal with the imbalance that exists in the bargaining power between small and big players, Jennie Nilsson tells DN.
From the beginning, it is the EU Directive on Unfair Business Practices (UTP) that will become Swedish law.
– We really want to do it in line with the Swedish food strategy, it is a step to strengthen the profitability of primary producers and small players in the food industry, he continues.
According to Jennie Nilsson, there is a “fair critique” from “big buyers” who unilaterally dictate terms, what producers can sell and what they should receive in payment.
As DN highlighted in several articles For example, the food oligopoly in Sweden, with the three large retail chains Ica, Coop and Axfood, has been criticized for poor competition, high profits at the expense of food producers and unfair business practices.
Read more: This is what Ica’s ladder of sanctions against food companies looks like
For example, it has been manifested as unreasonably long payment times, retailers demanding compensation for products that have gone bad in the store, late cancellations of ordered products, lawsuits for disclosing trade secrets, demands for money for marketing in the brochures of the chains, and copying products that the chains commercialize as EMV, own brands.
The Swedish researcher’s proposal it went beyond the EU directive, which has different steps for the size of the companies affected by the directive. In the Swedish proposal, there was no size requirement, but the law would apply equally to all companies.
On the sharp bill, however, there is a 2 million euro pass, explains Jennie NIlsson.
This means that buyers with a turnover of less than approximately SEK 20 million do not have to take the UTP directive into account.
The exception is made to reduce administration for small players in, for example, the hotel industry, in-country retailers, and in-country restaurants. According to Jennie Nilsson after listening to the consultation bodies.
LRF wants food producers to receive a greater share of income from stores, among other things, so that they can make sustainable investments.
Photo: Ingvar Andersson / TT
The Swedish Farmers Association, LRF, he sees it as a political concession due to the pandemic, which has hit the hotel industry hard.
– We would have preferred it to be the same for everyone, wrong business methods should not occur regardless of company size, and it would also have been simpler legislation if it applied to everyone, says Lars-Erik Lundkvist, expert at LRF, the Association of Farmers from Sweden.
At the same time, it welcomes the fact that the bill has already been tabled, as it is scheduled to enter into force in November and is becoming urgent.
According to Jennie Nilsson, everything indicates that the next bill will be passed in the Riksdag.
What does LRF expect to happen?
– That there will be healthier negotiations in which you focus on price and volumes and not on whether you should participate and pay for advertising campaigns or face threats of products leaving the shelves, says Lars-Erik Lundkvist.
He also hopes this will lead to food producers receiving more of the money consumers pay, in part because investments in sustainability are required.
– The entire food chain must take responsibility for these investments, in order to obtain returns at the farmer level for the development work that must continue. It’s something that consumers are appreciating and paying for more and more, and it’s reasonable to target those who have produced them, says Lars-Erik Lundkvist.
Read more: Top earning ica traders
