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Publication
Keeping your dawn raid guidance current
Unannounced inspections or ‘dawn raids’ are used by antitrust authorities to obtain evidence when there are suspicions that individuals or businesses have infringed the antitrust rules.
Global | Publication | June 2016
The question of what constitutes fair remuneration for farmers is a global topic and increasingly fraught as globalization and competition from producers in emerging markets continue to cat away the profits of traditional family farmers in developed markets.
In France, farmers and producers have taken to the streets to protest against the fall in prices for agricultural produce and declining incomes, in respect of which they are demanding a reassessment of the heavy burden of increasing environmental standards and high social charges, irrespective of the availability of State aids.
The agricultural industry is fraught with tension, even though the period for commercial negotiations between distributors and large industrials (during which an agreement is intended to be reached in relation to the setting of the price of agricultural produce) is drawing to a close.
The crisis for French farmers has a number of causes
It is an unprecedented crisis that has affected the French agricultural industry. According to the press, conditions have become so serious that attempted suicide is becoming common amongst French farmers.
Today, the main aims for the French farmers are a reduction in social charges and an increase in the sale price for agricultural produce, which according to press reports, had fallen below the cost of production by the end of 2015. It has been estimated that the price of agricultural raw materials in some cases accounts for just three per cent to five per cent of the final consumer price.
The main cause for anger of French farmers involves the French Law on the Modernisation of the Economy (LME). With a liberal orientation, this law has been accused of having totally deregulated the negotiations between distributors and industrials regarding the fixing of agricultural prices. Worse still, it is argued that this law does not take into account the interests of producers, who are completely excluded from negotiations.
This situation is not new. Adjustments to the LME had been envisaged in 2013/2014, to include the renegotiation of clauses in contracts between farmers, processors and distributors. Those clauses were intended to take into account the increase in production costs, which are highly dependent on fluctuations in the commodities market.
Certain players in the crisis ridden agricultural sector have argued that the envisaged adjustments have not been respected by distributors.
During the Salon de l’Agriculture, the French President François Hollande announced on February 27, 2016, that the LME will be reviewed, if no agreement is reached between distributors and producers at the closure of the current negotiations. The LME would in such case be amended before the summer, in order to obtain a better balance of power and ensure that farmers and producers are better paid. In particular, there has been a proposal to indicate the “producer price” on the final products.
In parallel, the French Prime Minister Manuel Valls has announced to the National Assembly, a reduction in social charges for all producers, along with a year without social charge contribution for low income farmers.
Publication
Unannounced inspections or ‘dawn raids’ are used by antitrust authorities to obtain evidence when there are suspicions that individuals or businesses have infringed the antitrust rules.
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