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Council of the European Union Brussels, 10 December 2024 (OR. en) 16776/24 Interinstitutional File: 2024/0318(COD) AGRI 878 AGRIORG 181 CODEC 2312 PROPOSAL From: Secretary-General of the European Commission, signed by Ms Martine DEPREZ, Director date of receipt: 10 December 2024 To: Ms Thérèse BLANCHET, Secretary-General of the Council of the European Union No. Cion doc.: COM(2024) 576 final Subject: Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on cooperation among enforcement authorities responsible for the enforcement of Directive (EU) 2019/633 on unfair trading practices in business-to-business relationships in the agricultural and food supply chain Delegations will find attached document COM(2024) 576 final. Encl.: COM(2024) 576 final 16776/24 LIFE.1 EN  EUROPEAN COMMISSION Brussels, 10.12.2024 COM(2024) 576 final 2024/0318 (COD) Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on cooperation among enforcement authorities responsible for the enforcement of Directive (EU) 2019/633 on unfair trading practices in business-to-business relationships in the agricultural and food supply chain EN EN  EXPLANATORY MEMORANDUM 1. CONTEXT OF THE PROPOSAL • Reasons for and objectives of the proposal Directive (EU) 2019/6331 (the Directive) required Member States to designate enforcement authorities to ensure the effective enforcement of the prohibitions laid down in Article 3 of the Directive. The enforcement authorities can act either on their own initiative or on the basis of complaints by parties affected by unfair trading practices in the agricultural and food supply chain. The Directive also introduced rules related to the powers of enforcement authorities ensuring that those authorities can investigate, collect information and order the termination of an unfair trading practice (Article 6 of the Directive). In addition, the Directive required the enforcement authorities to cooperate effectively with each other and with the Commission, and to provide each other with mutual assistance in investigations that have a cross-border dimension (Article 8 of the Directive). The experience of enforcement authorities is that gathering information, finding an infringement and imposing and enforcing fines and other equally effective penalties can be difficult where the buyer is located in another Member State. The ability of the enforcement authorities to cooperate in such cases should therefore be strengthened. Closing the enforcement gap aims a strengthening farmers’ position in the supply chain. To address this challenge the Commission put forward a reflection paper on 15 March 2024 in which it announced a set of measures intended to enhance the position of farmers in the food supply chain. A stand-alone legal act introducing new rules on cross-border enforcement of the Directive was included in the set of measures that the Commission announced. The Political Guidelines for the next European Commission 2024-2029 commit to strengthen farmers’ position and further protect them against unfair trading practices. Moreover, the Strategic Dialogue on the Future of EU Agriculture, announced by the President of the European Commission in her State of the Union Address on September 13th 2023 and launched in January 2024, which brought together 29 major stakeholders from the European agri-food sectors, civil society, rural communities and academia in its final report2 called for proactive steps both at European and national level inter alia to better address unfair trading practices. The Report on the Strategic Dialogue on the Future of EU Agriculture included recommendations for an effective, balanced and proportionate framework to address unfair trading practices, among others, the effective enforcement of unfair trading practices legislation, the cooperation among enforcement authorities in cross-border cases, including a common online platform to share investigations and information on cases, as well as the need for the enforcement authorities to have adequate and proportionate resources to enforce the legislation. 1 Directive (EU) 2019/633 of the European Parliament and of the Council of 17 April 2019 on unfair trading practices in business-to-business relationships in the agricultural and food supply chain (OJ L 111, 25.4.2019, p. 59, ELI: http://data.europa.eu/eli/dir/2019/633/oj). 2 Strategic Dialogue on the Future of EU Agriculture. EN 1 EN  • Consistency with existing policy provisions in the policy area The proposal complements the Directive with the view to ensuring that the enforcement authorities have the necessary tools to gather information, find an infringement and impose and enforce fines and other equally effective penalties against buyers located in another Member State. The proposal does not interfere with the ongoing evaluation of the Directive that the Commission is conducting in line with its legal obligation under the Directive itself or prejudge the result of that evaluation. • Consistency with other Union policies As explained in the explanatory memorandum of the proposal for what became the Directive, competition law has a different scope from rules on unfair trading practices, as unfair trading practices are unilateral practices that do not, in most cases, involve the existence of a dominant position in a given market or an abuse of that position. Accordingly, the rules in this proposal laying down measures solely for enforcement authorities designated under the Directive are compatible and complementary to the EU competition rules. While the EU has also adopted rules on cooperation between national authorities responsible for the enforcement of consumer protection laws3, the scope of those rules is different to the rules in this proposal, since the rules on consumer protection apply to business-to-consumer (B2C) situations and do not as such, cover business-to-business (B2B) situations, although Member States may choose to extend their scope. 2. LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY • Legal basis This proposal is based Article 43(2) TFEU because it complements the Directive, which is itself based on Article 43(2) TFEU. • Subsidiarity (for non-exclusive competence) This proposal concerns unfair trading practices with a cross-border dimension. The cross- border dimension of the enforcement of the rules on unfair trading practices cannot be sufficiently addressed by the Member States, especially in cases of unfair trading practices that affect more than two Member States. • Proportionality The proposal aims to improve and increase cooperation between enforcement authorities, while maintaining a minimal interference in the legal orders of the Member States. The proposed rules on collection of information and the proposed rules on enforcement do not alter national rules governing the collection of information and the adoption of enforcement measures. Rather, the proposed rules aim to ensure that a legal basis is provided to enable 3 Regulation (EU) 2017/2394 of the European Parliament and of the Council of 12 December 2017 on cooperation between national authorities responsible for the enforcement of consumer protection laws and repealing Regulation (EC) No 2006/2004 (OJ L 345, 27.12.2017, p. 1, ELI: http://data.europa.eu/eli/reg/2017/2394/oj). EN 2 EN  exchanges of information and requests for enforcement measures, for which the requested authority will follow its national rules. The proposal also does not impact the administrative system or the procedural laws of the Member States that remain free to design their systems of enforcement of the rules on unfair trading practices. • Choice of the instrument A Regulation has been chosen (like for other such EU cooperation instruments, notably those on customs cooperation4, VAT cooperation5, feed and food controls6, and consumer protection7), as the proposed rules essentially provide for directly applicable cooperation arrangements between public authorities. Without an appropriate EU legal framework that applies directly in all Member States, each Member State may take a different approach when laying down rules governing requests for information or requests for enforcement measures and may condition the actions of the enforcement authority by several factors. This may lead to legal uncertainty and ultimately hinder the enforcement against unfair trading practices in cross-border cases that is envisaged by the Directive. 3. RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS • Ex-post evaluations/fitness checks of existing legislation This is a proposal for a new Regulation of the European Parliament and of the Council and is not following an ex-post evaluation or fitness check of existing legislation. • Stakeholder consultations Due to urgency, no formal call for evidence was carried out. However, multiple workshops, events and meetings with stakeholders have taken place, in which stakeholders submitted 4 Regulation (EU) 2021/444 of the European Parliament and of the Council of 11 March 2021 establishing the Customs programme for cooperation in the field of customs and repealing Regulation (EU) No 1294/2013, OJ L 87, 15.3.2021, p. 1–16, ELI: http://data.europa.eu/eli/reg/2021/444/oj 5 Council Regulation (EU) No 904/2010 of 7 October 2010 on administrative cooperation and combating fraud in the field of value added tax, OJ L 268 12.10.2010, p. 1, ELI: http://data.europa.eu/eli/reg/2010/904/2024-01-01 6 Regulation (EU) 2017/625 of the European Parliament and of the Council of 15 March 2017 on official controls and other official activities performed to ensure the application of food and feed law, rules on animal health and welfare, plant health and plant protection products, amending Regulations (EC) No 999/2001, (EC) No 396/2005, (EC) No 1069/2009, (EC) No 1107/2009, (EU) No 1151/2012, (EU) No 652/2014, (EU) 2016/429 and (EU) 2016/2031 of the European Parliament and of the Council, Council Regulations (EC) No 1/2005 and (EC) No 1099/2009 and Council Directives 98/58/EC, 1999/74/EC, 2007/43/EC, 2008/119/EC and 2008/120/EC, and repealing Regulations (EC) No 854/2004 and (EC) No 882/2004 of the European Parliament and of the Council, Council Directives 89/608/EEC, 89/662/EEC, 90/425/EEC, 91/496/EEC, 96/23/EC, 96/93/EC and 97/78/EC and Council Decision 92/438/EEC (Official Controls Regulation), OJ L 095 7.4.2017, p. 1, ELI: http://data.europa.eu/eli/reg/2017/625/2022-01-28 7 Regulation (EU) 2017/2394 of the European Parliament and of the Council of 12 December 2017 on cooperation between national authorities responsible for the enforcement of consumer protection laws and repealing Regulation (EC) No 2006/2004, OJ L 345 27.12.2017, p. 1, ELI: http://data.europa.eu/eli/reg/2017/2394/2022-01-01 EN 3 EN  comments, evidence and suggestions on how the enforcement of unfair trading practices could be improved. The enforcement authorities responsible for the enforcement of the Directive meet at least once per year and discuss best practices, new cases and new developments in the area of unfair trading practices in the agricultural and food supply chain, and exchange information. The Commission facilitates all those meetings and has, in this context, gathered the views of the enforcement authorities on cross-border enforcement. • Collection and use of expertise While no call for evidence or public consultation were conducted due to the urgency to act, the Commission has presented the proposed measures several times to stakeholders and the enforcement authorities and in bilateral meetings involving all relevant EU based associations within the agri-food supply chain, including consumers. The enforcement authorities have acknowledged the challenges posed by cross-border enforcement against unfair trading practices and developed common guidelines, templates and procedures to ensure more effective coordination between them. • Impact assessment An impact assessment was not carried out for this proposal because of the limited choice between policy options available for the Commission. The proposal is to be seen as an enforcement tool laying down already existing obligations under the UTP Directive (for which there are no procedural rules in place on how to achieve this), enhancing cooperation among enforcement authorities. • Regulatory fitness and simplification The present proposal is one of the measures announced in the Commission’s Reflection Paper of 15 March 2024 as part of the Simplification Package. Laying out an EU legal framework applicable in all Member States will ensure that there are no different approaches that could undermine legal certainty, lead to lengthy procedures, and create confusion in the cooperation among enforcement authorities. In addition, the opinion of the ‘Fit For Future Platform’ noted, that while increased harmonisation could lead to less flexibility to adapt the rules on a national level, the numerous challenges that arise in dealing with unfair trade practices with a cross-border dimension create the need to enact legal rules that will apply in all Member States in dealing with unfair trade practices with a cross-border dimension. • Fundamental rights The EU is committed to high standards of fundamental rights’ protection. This proposal respects the rights enshrined in the Charter of Fundamental Rights of the EU. The proposal will contribute to the ability of suppliers to conduct a business. The proposal also aims to ensure that the exercise of the powers referred to in this Regulation is subject to appropriate safeguards in respect of the buyers' rights of defence, including the right to be heard and the right to an effective remedy. The proposal further requires that enforcement proceedings of the enforcement authorities are conducted within a reasonable timeframe. EN 4 EN  4. BUDGETARY IMPLICATIONS The proposal does not have an impact on the EU budget. It would require the use of an existing website for the information exchange by the enforcement authorities and the Commission. 5. OTHER ELEMENTS • Implementation plans and monitoring, evaluation and reporting arrangements The present proposal is a proposal for a new EU Regulation as a complementary tool to the Directive. Therefore, the implementation plan and monitoring, evaluation and reporting arrangements remain the same as under the current framework. • Explanatory documents (for directives) The proposal concerns an EU Regulation. • Detailed explanation of the specific provisions of the proposal First, procedural rules for exchanges of information between enforcement authorities should be laid down. Requests for information are to be made in writing, stating the corresponding provision of the Directive, as well as the national law. The collection of the requested information is to be made by the requested enforcement authority and used by the applicant enforcement authority in accordance with their national laws. Second, the possibility is introduced for a requested enforcement authority to exercise, in accordance with the national rules of its Member State, the powers attributed to it by the Directive. Third, an enforcement authority should be able to enforce, at the request of another, in accordance with the national rules of its Member State, final decisions imposing fines or other equally effective penalties and interim measures, adopted in accordance with the Directive. Fourth, in order to increase transparency, enforcement authorities should be able to notify their decisions to the other enforcement authorities. Fifth, to ensure that the mutual assistance mechanism established under the Regulation is achieved, exhaustive rules enabling the enforcement authorities to refuse to comply with a request for mutual assistance, should be laid down. Sixth, in order to avoid obstacles to a smooth cooperation linked to the absence of an agreed language regime, rules allowing the enforcement authorities to agree on the language to be used in all notifications, requests and communications between them, as well as rules in case of disagreement among them, should be laid down. Seventh, in accordance with this Regulation, an unfair trading practice with a cross-border dimension, involving at least three Member States should be considered as a widespread unfair trading practice. Eighth, in cases of widespread unfair trading practices, the enforcement authorities of the Member States concerned should be able to issue alerts, engage in coordinated actions, and designate a coordinator to coordinate the cooperation among the relevant authorities in whose territories the practice may be taking place. EN 5 EN  Ninth, procedures for the coordination of investigation and enforcement measures relating to widespread unfair trading practices with a cross-border dimension should be laid down. Tenth, it is necessary to list the cases where a concerned enforcement authority may decide to refuse to participate in a coordinated action. Eleventh, with a view to ensuring that the enforcement authorities concerned by the coordinated action have all the tools necessary to communicate, cooperate, and coordinate, this Regulation should lay down rules on language arrangements. EN 6 EN  2024/0318 (COD) EN 7 EN  Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on cooperation among enforcement authorities responsible for the enforcement of Directive (EU) 2019/633 on unfair trading practices in business-to-business relationships in the agricultural and food supply chain THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty on the Functioning of the European Union, and in particular Article 43(2) thereof, Having regard to the proposal from the European Commission, After transmission of the draft legislative act to the national parliaments, Having regard to the opinion of the European Economic and Social Committee1, Having regard to the opinion of the Committee of the Regions2, Acting in accordance with the ordinary legislative procedure, Whereas: (1) Directive (EU) 2019/633 of the European Parliament and of the Council 3 introduced a minimum Union standard of protection against unfair trading practices to reduce the occurrence of practices which are likely to have a negative impact on the living standards of the agricultural community. (2) Directive (EU) 2019/633 requires Member States to designate enforcement authorities that ensure the effective enforcement of the prohibitions laid down in that Directive. That Directive also requires the Commission and those enforcement authorities to cooperate closely to ensure a common approach with respect to the application of the rules set out in that Directive. In particular, the enforcement authorities should provide each other with mutual assistance, including by sharing information and assisting in investigations that have a cross-border dimension. (3) Due to the principle of territoriality, enforcement authorities may face difficulties gathering information, finding an infringement and imposing and enforcing fines and other equally effective penalties where a buyer is established in another Member State. Such difficulties affect the system of enforcement established by Directive (EU) 2019/633, which depends on cooperation between enforcement authorities, and may lead to an uneven enforcement of unfair trading practices, undermining the protection for suppliers of agricultural and food products intended by that Directive. It is 1 OJ C […], […], p. […]. 2 OJ C , , p. . 3 Directive (EU) 2019/633 of the European Parliament and of the Council of 17 April 2019 on unfair trading practices in business-to-business relationships in the agricultural and food supply chain (OJ L 111, 25.4.2019, p. 59, ELI: http://data.europa.eu/eli/dir/2019/633/oj). EN 8 EN  therefore appropriate to establish rules strengthening cooperation between enforcement authorities in cross-border cases. (4) Given that Directive (EU) 2019/633 allows Member States to maintain or introduce stricter national rules against unfair trading practices, it should be clarified that this Regulation does not cover those rules. However, the Regulation should allow the Member States to decide that their enforcement authorities can make use of the possibility to exchange information established under the mutual assistance mechanism set out by this Regulation in relation to such rules. In those cases, the enforcement authorities should still have the right to refuse to comply with such a request. (5) To ensure the effective application of their obligations under this Regulation, enforcement authorities should be provided with the necessary resources and expertise. (6) Enforcement authorities should have the power to provide one another with and use in evidence in accordance with their national law any matter of fact or of law, including confidential information. Information exchanged shall only be used in evidence for the purpose of applying the rules established by Directive (EU) 2019/633 and in respect of the subject-matter for which it was collected by the transmitting authority. (7) Enforcement authorities should be empowered in their own territory to exercise the powers referred to in Article 6(1), points (b) and (c), of Directive (EU) 2019/633, in accordance with their national law, on behalf of and for the account of other enforcement authorities. (8) Enforcement authorities should inform one another of an unfair trading practice with a cross-border dimension that has occurred or is occurring in their territory. (9) Enforcement authorities should be empowered in their own territory and in accordance with their national law to enforce, or initiate proceedings for the enforcement of, final decisions imposing fines or other equally effective penalties on behalf of and for the account of other enforcement authorities, provided that those other enforcement authorities have made reasonable efforts to ascertain that the buyers against which the fines or other equally effective penalties are to be enforced do not have sufficient assets in the Member States of those other enforcement authorities. (10) Enforcement authorities should be able to exchange and seek information from other enforcement authorities by issuing requests for information. These requests should specify what information is considered necessary in each case to conduct investigations of unfair trading practices. (11) Enforcement authorities should not be entitled to refuse to comply with a request for information or to refuse to participate in enforcement measures unless it is likely that enforcement actions and administrative decisions taken at national level outside the mutual assistance mechanism would ensure cessation of the unfair trading practice with a cross-border dimension. Moreover, enforcement authorities should give reasons for such a refusal. (12) Lack of procedural arrangements on the language regime may pose obstacles to the smooth cooperation between enforcement authorities. For this reason, rules allowing the enforcement authorities to agree on the language to be used in all notifications, requests and communications between them, as well as rules in case of disagreement among them, should be laid down. EN 9 EN  (13) With a view to ensuring uniform conditions for the implementation of the measures laid down in this Regulation, implementing powers should be conferred on the Commission to be able to develop standard forms for requests for information or requests for enforcement measures. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council4. In the absence of standard forms developed by the Commission, the enforcement authorities should be entitled to develop such forms to facilitate the mutual assistance mechanism. (14) Where a widespread unfair trading practice with a cross-border dimension, involving at least three Member States may be taking place, the enforcement authorities concerned by that practice should be able to issue alerts, engage in coordinated actions, and designate a coordinator to coordinate the cooperation among the relevant authorities in whose territories the practice may be taking place. To establish which enforcement authorities are concerned by a widespread unfair trading practice with a cross-border dimension, all relevant aspects should be considered, in particular the place where the buyer is established and the location of the suppliers that may be affected by the unfair trading practice. The detection of widespread unfair trading practices with a cross-border dimension should be supported by exchanging information between enforcement authorities when there is a reasonable suspicion of such unfair trading practices with a cross-border dimension. The coordinator should exercise its competence within a framework of close cooperation with the other enforcement authorities concerned. Likewise, all enforcement authorities concerned should actively engage in the investigation at an early stage, and issue alerts to the Commission and to the enforcement authorities concerned by a widespread unfair trading practice with a cross-border dimension and share the necessary information available to them about such practices. (15) Procedures for the coordination of investigation and enforcement measures relating to widespread unfair trading practices with a cross-border dimension should be laid down. Coordinated actions against widespread unfair trading practices with a cross- border dimension should ensure that enforcement authorities are able to choose the most appropriate and efficient tools to stop those practices. (16) It is necessary to list the cases where a concerned enforcement authority may decide to refuse to participate in a coordinated action. In particular, lack of available resources on the part of an enforcement authority concerned by that unfair trading practice with a cross-border dimension should not be considered to justify refusing to participate in a coordinated action. (17) With a view to ensuring that the enforcement authorities concerned by the coordinated action have all the tools necessary to communicate, cooperate, and coordinate, this Regulation should lay down rules on language arrangements. (18) This Regulation respects fundamental rights and observes the principles recognised in particular by the Charter of Fundamental Rights of the European Union and present in the constitutional traditions of the Member States. Accordingly, this Regulation should be interpreted and applied in accordance with those rights and principles. 4 Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers (OJ L 55, 28.2.2011, p. 13, ELI: http://data.europa.eu/eli/reg/2011/182/oj). EN 10 EN  (19) Criminal investigations and judicial proceedings in Member States should not be affected by the application of this Regulation. (20) Since the objective of this Regulation, namely cooperation between the enforcement authorities responsible for the enforcement of the prohibition of unfair trading practices under Directive (EU) 2019/633, cannot be sufficiently achieved by the Member States because they cannot ensure cooperation and coordination by acting alone, but can rather, by reason of its territorial and personal scope, be better achieved at the Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Regulation does not go beyond what is necessary in order to achieve that objective. (21) In order to give the enforcement authorities the time needed to be able to implement the rules laid down in this Regulation, its application should be deferred by 1 year after its entry into force, HAVE ADOPTED THIS REGULATION: CHAPTER I INTRODUCTORY PROVISIONS Article 1 Subject matter This Regulation lays down certain rules under which the enforcement authorities, having been designated by their Member States as responsible for the enforcement of the prohibition of unfair trading practices in business-to-business relationships in the agricultural and food supply chain under Directive (EU) 2019/633, cooperate and coordinate actions with each other. Article 2 Scope 1. This Regulation applies to the enforcement of the prohibition of unfair trading practices in business-to-business relationships in the agricultural and food supply chain laid down in Article 3(1) and (2) of Directive (EU) 2019/633 with a cross-border dimension. However, Article 5 of this Regulation also applies in relation to national rules within the meaning of Article 9 of Directive (EU) 2019/633 if the Member State so decides in accordance with paragraph 4 of that Article. 2. This Regulation is without prejudice to the Union and national rules on private international law, in particular rules related to court jurisdiction and applicable laws. 3. This Regulation is without prejudice to the application in the Member States of measures relating to judicial cooperation in civil and criminal matters, in particular the operation of the European Judicial Network established by Council Decision 2008/976/JHA5. 5 Council Decision 2008/976/JHA of 16 December 2008 on the European Judicial Network (OJ L 348, 24.12.2008, p. 130, ELI: http://data.europa.eu/eli/dec/2008/976/oj). EN 11 EN  Article 3 Definitions For the purposes of this Regulation, the definitions referred to in Article 2 of Directive (EU) 2019/633 apply. In addition, the following definitions apply: (a) ‘enforcement authority’ means the national authority or national authorities designated by a Member State pursuant to Article 4(1) of Directive (EU) 2019/633; (b) ‘applicant enforcement authority’ means the enforcement authority that makes a request for mutual assistance; (c) ‘requested enforcement authority’ means the enforcement authority that receives a request for mutual assistance; (d) ‘unfair trading practice with a cross-border dimension’ means any unfair trading practice within the meaning of Directive (EU) 2019/633 involving one supplier and one buyer that are located in different Member States; (e) ‘widespread unfair trading practice with a cross-border dimension’ means any unfair trading practice within the meaning of Directive (EU) 2019/633 involving at least three Member States; (f) ‘final decision’ means a decision that cannot be, or that can no longer be, appealed by ordinary means. CHAPTER II RESOURCES AND EXPERTISE Article 4 Resources and expertise Member States shall ensure that enforcement authorities have the necessary resources and expertise for the application of this Regulation. CHAPTER III MUTUAL ASSISTANCE MECHANISM Article 5 Requests for information 1. At the request of an applicant enforcement authority, a requested enforcement authority shall, without delay, and within 60 days unless otherwise agreed, provide the applicant enforcement authority with the information requested to establish whether an unfair trading practice in the Member State of the applicant enforcement authority with a cross-border dimension has occurred or is occurring. 2. The applicant enforcement authority shall, when sending a request for information to the requested enforcement authority, state as legal basis this Regulation, the national law transposing Directive (EU) 2019/633, and the corresponding provisions of Directive (EU) 2019/633, the purpose of the request, and specify what information is required. EN 12 EN  3. The information provided shall only be collected by the requested enforcement authority and used by the applicant enforcement authority in accordance with their national law. 4. Member States may decide that enforcement authorities can make use of the possibilities referred to in this Article in relation to national rules within the meaning of Article 9 of Directive (EU) 2019/633. When an applicant enforcement authority makes use of the possibility provided in subparagraph 1, the requested enforcement authority may refuse to provide information, indicating the reasons for the refusal. Article 6 Requests for enforcement measures 1. At the request and on behalf of an applicant enforcement authority, the requested enforcement authority shall exercise, in accordance with the national rules of its Member State, the powers set out in Article 6(1), first subparagraph, points (a), (b) and (c), of Directive (EU) 2019/633. 2. When a requested enforcement authority exercises the powers set out in Article 6(1), first subparagraph, points (a), (b) and (c), of Directive (EU) 2019/633 at the request and on behalf of an applicant enforcement authority, officials and other accompanying persons authorised or appointed by the applicant enforcement authority shall be permitted to attend and assist the requested enforcement authority, under the supervision of the officials of the requested enforcement authority. 3. The requested enforcement authority shall inform the applicant enforcement authority about the steps and measures taken and the steps and measures that it intends to take. Article 7 Requests for the enforcement of decisions imposing fines or other equally effective penalties and interim measures 1. At the request of an applicant enforcement authority, the requested authority shall enforce, in accordance with its national law, final decisions imposing fines or other equally effective penalties and interim measures adopted in accordance with Article 6(1), first subparagraph, point (e), of Directive (EU) 2019/633. 2. Paragraph 1 shall apply only to the extent that, after having made reasonable efforts in its own territory, the applicant enforcement authority has ascertained that the buyer against which the fine and the other penalties and interim measures are enforceable does not have sufficient assets in the territory of its Member State. 3. The applicant enforcement authority may request only the enforcement of a final decision. 4. Questions regarding limitation periods for the enforcement of fines, other equally effective penalties and interim measures shall be governed by the national law of the Member State of the requested authority. Article 8 Notification mechanism EN 13 EN  An enforcement authority shall notify all other enforcement authorities within 1 month after adopting a decision establishing the occurrence of an unfair trading practice with a cross- border dimension in its Member State. Article 9 Procedure for requests for mutual assistance 1. The applicant enforcement authority shall, when making a request for mutual assistance, provide any relevant information necessary to enable the requested enforcement authority to fulfil that request, including any information that can be obtained only in the Member State of the applicant enforcement authority. 2. Requests for mutual assistance and all communications linked to them shall be made in writing using standard forms. Article 10 Refusal to comply with a request for mutual assistance 1. A requested enforcement authority may refuse to comply with a request for information under Article 5 only if one or both of the following applies: (a) following a consultation with the applicant enforcement authority, the information requested is not needed by the applicant enforcement authority to establish whether an unfair trading practice with a cross-border dimension has occurred or is occurring; (b) criminal investigations or judicial proceedings have already been initiated against the same buyer in respect of the same unfair trading practice before the authorities in the Member State of the requested enforcement authority or of the applicant enforcement authority. 2. A requested enforcement authority may refuse to comply with a request for enforcement measures under Articles 6 and 7 only if, having consulted with the applicant enforcement authority, one or both of the following applies: (a) criminal investigations or judicial proceedings have already been initiated, a judgment has been given, or a court settlement has been reached in respect of the same unfair trade practice before the judicial authorities in the Member State of the requested enforcement authority; (b) the exercise of the necessary enforcement powers has already been initiated, or an administrative decision has already been adopted in respect of the same intra-Union infringement and against the same trader in the Member State of the requested authority in order to bring about the swift and effective cessation of the same unfair trade practice; (c) a criminal investigation or judicial proceedings have already been initiated as regards the same buyer in respect of the same unfair trade practice before the judicial authorities of the applicant; (d) the applicant enforcement authority has not provided the information that is necessary in accordance with Article 5. 3. The requested enforcement authority shall inform the applicant enforcement authority of any refusal to comply with a request for mutual assistance, together with the reasons for that refusal. Article 11 Language arrangements EN 14 EN  1. The languages used by the enforcement authorities for requests, notifications and all other communications covered by this Chapter which are linked to the mutual assistance mechanism, shall be agreed upon with the enforcement authorities concerned. 2. If no agreement can be reached between the enforcement authorities concerned, requests for mutual assistance shall be sent in the official language, or one of the official languages, of the Member State of the applicant enforcement authority and replies in the official language, or one of the official languages, of the Member State of the requested enforcement authority. Article 12 Implementing powers The Commission may adopt implementing acts laying down standard forms for the requests of mutual assistance under Article 9(2). The implementing acts referred to in the first paragraph shall be adopted in accordance with the examination procedure referred to in Article 21. CHAPTER IV INVESTIGATION AND ENFORCEMENT MECHANISMS FOR WIDESPREAD UNFAIR TRADING PRACTICES WITH A CROSS-BORDER DIMENSION Article 13 Launch of a coordinated action and designation of the coordinator 1. Where there is a reasonable suspicion that there may be a widespread unfair trading practice with a cross-border dimension, the enforcement authorities concerned by that practice shall launch a coordinated action which shall be based on an agreement between them. The launch of the coordinated action shall be notified to the Commission without delay. 2. The enforcement authorities concerned by the widespread unfair trading practice with a cross-border dimension shall designate an enforcement authority to be the coordinator. 3. The enforcement authorities concerned by the widespread unfair trading practice with a cross-border dimension shall conduct investigations on the basis of information that is available to them. They shall notify the results of such investigations to the other enforcement authorities, pursuant to Article 19. 4. An enforcement authority shall join the coordinated action if it becomes apparent during that coordinated action that the enforcement authority is concerned by the widespread unfair trading practice with a cross-border dimension. 5. In order to establish that an enforcement authority is concerned by a widespread unfair trading practice with a cross-border dimension all elements shall be taken into account and in particular: a) the Member States where the buyers are established; b) the Member States where the suppliers that may be affected by the unfair trading practice are established. EN 15 EN  Article 14 Reasons for refusing to take part in the coordinated action 1. An enforcement authority may refuse to take part in a coordinated action only if any of the following applies: (a) a criminal investigation or judicial proceedings have already been initiated, a judgment has been given, or a court settlement has been reached in respect of the same buyer and concerning the same unfair trading practice in that enforcement authority’s Member State; (b) the enforcement authority has already initiated investigations before the issuing of an alert referred to in Article 19, or an administrative decision has been adopted against the same buyer in respect of the same unfair trading practice in that enforcement authority’s Member State to bring about the cessation of the widespread unfair trading practice with a cross-border dimension; (c) the widespread unfair trading practice with a cross-border dimension has not occurred in that enforcement authority’s Member State and therefore no enforcement measures need to be adopted by that enforcement authority. 2. Where an enforcement authority refuses to take part in the coordinated action, it shall inform the Commission and the other enforcement authorities concerned by the widespread unfair trading practice with a cross-border dimension about its decision without delay, stating the reasons for its decision and providing any necessary supporting documents. Article 15 Investigation measures in coordinated actions 1. The enforcement authorities concerned by the coordinated action shall ensure that investigations and inspections are conducted in a coordinated manner. They shall seek to conduct investigations and inspections and, to the extent that national law so allows, to apply interim measures simultaneously with one another. 2. The enforcement authorities concerned by the coordinated action shall set out the outcome of the investigation and the assessment of the widespread unfair trading practice with a cross- border dimension in a common position, summarising the national decisions adopted. 3. Without prejudice to the rules on confidentiality and on professional and trade secrecy laid down in Directive (EU) 2016/943 of the European Parliament and of the Council6, the enforcement authorities concerned by the coordinated action shall publish the common position or parts thereof on their websites and inform the Commission of the publication. Article 16 Enforcement measures in coordinated actions 1. The enforcement authorities concerned by the coordinated action shall take within their jurisdiction all necessary enforcement measures under Article 6 of Directive (EU) 2019/633 6 Directive (EU) 2016/943 of the European Parliament and of the Council of 8 June 2016 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure (OJ L 157, 15.6.2016, p. 1, ELI: http://data.europa.eu/eli/dir/2016/943/oj). EN 16 EN  against the buyer responsible for the widespread unfair trading practice with a cross-border dimension to bring about the cessation of that unfair trading practice. 2. Enforcement measures pursuant to paragraph 1 shall be taken by the enforcement authorities in accordance with the national rules of their Member State and in a coordinated manner to bring about the cessation of the widespread unfair trading practice with a cross- border dimension. The enforcement authorities concerned by the coordinated action shall seek to take enforcement measures simultaneously in the Member States concerned by that widespread cross-border infringement. Article 17 Cessation of coordinated action 1. A coordinated action shall cease if the enforcement authorities concerned by the coordinated action conclude that the widespread unfair trading practice with a cross-border dimension has ceased in all Member States concerned, or that no such widespread unfair trading practice with a cross-border dimension was committed. 2. The coordinator referred to in Article 13(2) shall notify, where applicable, the enforcement authorities of the Member States concerned by the coordinated action of the cessation of the coordinated action without delay. Article 18 Role of the coordinator 1. The coordinator appointed in accordance with Article 13 shall in particular: (a) ensure that the enforcement authorities concerned are duly informed, in a timely manner, of the progress of the investigation or of the enforcement action, and informed of any anticipated next steps and the measures to be adopted; (b) coordinate and monitor the investigation measures taken by the enforcement authorities concerned in accordance with this Regulation; (c) coordinate the preparation and sharing of all necessary documents among the enforcement authorities concerned; (d) maintain contact with the buyer and other parties concerned by the investigation or enforcement measures, as applicable, unless otherwise agreed by the enforcement authorities concerned and the coordinator; (e) where applicable, coordinate the assessment, the consultations and the monitoring by the enforcement authorities concerned as well as other steps necessary to implement the commitments proposed by the buyer concerned; (f) where applicable, coordinate enforcement measures adopted by the enforcement authorities concerned; (g) coordinate requests for mutual assistance submitted by the enforcement authorities concerned pursuant to Chapter III. 2. The coordinator shall not be held responsible for the actions or the omissions of the other enforcement authorities concerned when they make use of the powers set out in Article 6 of Directive (EU) 2019/633 and in the rules laid down in this Regulation. EN 17 EN  Article 19 Alerts 1. An enforcement authority shall without delay alert the Commission and the other enforcement authorities that a widespread unfair trading practice with a cross-border dimension may be taking place. 2. The enforcement authority shall, when issuing an alert referred to in paragraph 1, provide information about the suspected widespread unfair trading practice with a cross-border dimension covered by this Regulation, including, the following: (a) a description of the widespread unfair trading practice with a cross-border dimension; (b) details of the subject matter of the widespread unfair trading practice with a cross-border dimension; (c) the Member States concerned or possibly concerned by the widespread unfair trading practice with a cross-border dimension; (d) the identity of the buyer or buyers suspected of committing the widespread unfair trading practice with a cross-border dimension; (e) the unfair trading practice concerned under Directive (EU) 2019/633 and by reference to national law; (f) a description of any legal proceedings, enforcement measures or other measures taken concerning the widespread unfair trading practice with a cross-border dimension and their dates and duration, as well as the status thereof; (g) the identities of the enforcement authorities bringing the proceedings and taking other measures. 3. The enforcement authority may, when issuing an alert, request enforcement authorities in other Member States to verify whether, based on information that is available or easily accessible to the relevant enforcement authorities, the same widespread unfair trading practices may be taking place in the territory of those other Member States or whether any proceedings are pending or any enforcement measures have already been taken against such unfair trading practices in those Member States. The enforcement authorities in those other Member States shall reply to the request without delay. Article 20 Language arrangements 1. The languages used by the enforcement authorities for notifications, as well as for all other communications covered by this Chapter which are linked to the coordinated actions, shall be agreed upon by the enforcement authorities concerned. 2. If no agreement can be reached between the enforcement authorities concerned, notifications and other communications shall be sent in the official language or one of the official languages of the Member State making the notification or other communication. CHAPTER V FPROCEDURAL PROVISIONS EN 18 EN  Article 21 Committee procedure 1. The Commission shall be assisted by the Committee for the Common Organisation of the Agricultural Markets established by Article 229 of Regulation (EU) No 1308/2013 of the European Parliament and of the Council7. That Committee shall be a committee within the meaning of Regulation (EU) No 182/2011. 2. Where reference is made to this paragraph, Article 5 of Regulation (EU) No 182/2011 shall apply. CHAPTER VI FINAL PROVISIONS Article 22 Entry into force and application This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. It shall apply from [+ 1 year from the adoption]. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, For the European Parliament For the Council The President The President 7 Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013 establishing a common organisation of the markets in agricultural products and repealing Council Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007 (OJ L 347, 20.12.2013, p. 671, ELI: http://data.europa.eu/eli/reg/2013/1308/oj). EN 19 EN Council of the European Union Brussels, 10 December 2024 (OR. en) 16779/24 Interinstitutional File: 2024/0319(COD) AGRI 879 AGRIORG 182 AGRIFIN 145 AGRILEG 457 CODEC 2313 PROPOSAL From: Secretary-General of the European Commission, signed by Ms Martine DEPREZ, Director date of receipt: 10 December 2024 To: Ms Thérèse BLANCHET, Secretary-General of the Council of the European Union No. Cion doc.: COM(2024) 577 final Subject: Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulations (EU) No 1308/2013, (EU) 2021/2115 and (EU) 2021/2116 as regards the strengthening of the position of farmers in the food supply chain Delegations will find attached document COM(2024) 577 final. Encl.: COM(2024) 577 final 16779/24 LIFE.1 EN  EUROPEAN COMMISSION Brussels, 10.12.2024 COM(2024) 577 final 2024/0319 (COD) Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulations (EU) No 1308/2013, (EU) 2021/2115 and (EU) 2021/2116 as regards the strengthening of the position of farmers in the food supply chain EN EN  EXPLANATORY MEMORANDUM 1. CONTEXT OF THE PROPOSAL • Reasons for and objectives of the proposal Through successive reforms, the Common Agricultural Policy (‘CAP’) has shifted towards income support and market orientation with free formation of prices for agricultural products. Those reforms mainly responded to endogenous challenges, surpluses and crises. However, most of the challenges of the agricultural sector are driven by factors that are external to agriculture and require a broader policy response. The CAP already provides for certain measures that aim at strengthening the position of farmers in the food supply chain. However, the pressure on agricultural incomes is expected to continue as farmers face increasing risks, rising input costs and more stringent production requirements. The Covid-19 pandemic and Russia’s ongoing war of aggression against Ukraine have led to an unprecedented increase of energy-related agricultural inputs costs and a prolonged period of high inflation, affecting farmers’ costs and food prices. In parallel, farmers continue to undertake efforts to make their production more sustainable in line with EU standards. Moreover, many consumers, dealing with an increased cost of living, have directed their consumption patterns towards less expensive food products. This has further destabilised the distribution of value added along the food supply chain, creating instability in the allocation of profits and costs between the actors of the chain, fuelling protests and increasing mistrust. On 15 March 2024, the Commission put forward a reflection paper in which it announced a set of measures intended to enhance the position of farmers in the food supply chain. A targeted amendment of Regulation (EU) No 1308/2013 and related CAP Regulations was included in the set of measures that the Commission announced. The Agriculture and Fisheries Council of 26 March 2024 supported the measures announced in the reflection paper. The Political Guidelines for the next European Commission 2024-2029 emphasise the need for farmers to have a fair and sufficient income and the need to correct existing imbalances, strengthen farmers’ position and further protect them against unfair trading practices. Moreover, the Strategic Dialogue on the Future of EU Agriculture, announced by the President of the European Commission in her State of the Union Address on 13 September 2023 and launched in January 2024, which brought together 29 major stakeholders from the European agri-food sectors, civil society, rural communities and academia in its final report1 called for adjustments to the farmers’ position in the value chain. The Guiding Political Principles of the Strategic Dialogue report clearly highlight that market conditions must allow for decent revenues for farmers and other food chain actors and that power relations in the food chain must be well balanced. The first chapter of recommendations of the Strategic Dialogue deals with a fair and competitive food value chain through strengthening farmers’ position in the food value chain. Recommendations refer, in particular, to contracts, inviting to consider data on production costs and prices as relevant elements in contractual negotiation, and the possibility to open up negotiations in case of an exceptional cost increase. They also mention the importance of mediation mechanisms. Concerning cooperation, they 1 Strategic Dialogue on the Future of EU Agriculture. EN 1 EN  call for reinforcement of Producer Organisations (POs), Associations of Producer Organisations (APOs), as well as simplification of their recognition process and targeted support in their favour. The Strategic Dialogue recognises that economic, environmental, and social dimensions of sustainability are of equal importance for European societies in general and the agri-food systems in particular, and that the CAP should promote positive environmental and social outcomes and support the diversification of sustainable business model, including for example short supply chains. In line with the recommendations of the Strategic Dialogue report, it is thus appropriate to take measures to strengthen the contractual position of farmers and restore the trust of the actors in the food supply chain. • Consistency with existing policy provisions in the policy area Article 39 TFEU sets out the objectives of the CAP: • to increase agricultural productivity by promoting technical progress and by ensuring the rational development of agricultural production and the optimum utilisation of the factors of production, in particular labour; • thus to ensure a fair standard of living for the agricultural community, in particular by increasing the individual earnings of persons engaged in agriculture; • to stabilise markets; • to assure the availability of supplies; • to ensure that supplies reach consumers at reasonable prices. This proposal is consistent with those objectives and with the general philosophy of the CAP Regulations currently in force (the Common Market Organisation Regulation 2, the CAP Strategic Plan Regulation3, and the Regulation on the Financing, management and monitoring of the CAP4). • Consistency with other Union policies This proposal amends a limited number of provisions of the CAP Regulations currently in force, without altering their essence. As those provisions are consistent with other Union policies, the proposal is also consistent with those policies. 2. LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY • Legal basis The legal basis for this proposal is the first subparagraph of Article 42 and Article 43(2) of the Treaty on the Functioning of the European Union (TFEU) because: (i) the proposal amends 2 Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013 establishing a common organisation of the markets in agricultural products and repealing Council Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007, (OJ L 347 20.12.2013, p. 671, ELI: http://data.europa.eu/eli/reg/2013/1308/2024-05-13). 3 Regulation (EU) 2021/2115 of the European Parliament and of the Council of 2 December 2021 establishing rules on support for strategic plans to be drawn up by Member States under the common agricultural policy (CAP Strategic Plans) and financed by the European Agricultural Guarantee Fund (EAGF) and by the European Agricultural Fund for Rural Development (EAFRD) and repealing Regulations (EU) No 1305/2013 and (EU) No 1307/2013, (OJ L 435 6.12.2021, p. 1, ELI: http://data.europa.eu/eli/reg/2021/2115/2024-05-25). 4 Regulation (EU) 2021/2116 of the European Parliament and of the Council of 2 December 2021 on the financing, management and monitoring of the common agricultural policy and repealing Regulation (EU) No 1306/2013, (OJ L 435 6.12.2021, p. 187, ELI: http://data.europa.eu/eli/reg/2021/2116/2022- 08-26). EN 2 EN  Regulation (EU) No 1308/2013, Regulation (EU) 2021/2115 and Regulation (EU) 2021/2116, which are all based on Article 43(2) TFEU; and (ii) Regulation (EU) No 1308/2013 is also based on the first subparagraph of Article 42 TFEU and this proposal also contains provisions that regulate the (non)application of competition rules. • Subsidiarity (for non-exclusive competence) This proposal amends existing Regulations adopted at the EU level and that are applicable in all Member States. The amendments seek to strengthen the position of farmers in the agri-food supply chain by: (i) simplifying the rules on recognition of producer organisations; (ii) reinforcing the rules on contractualisation; (iii) setting out rules on the use of cross-sectoral optional terms for “fair”, “equitable” and equivalent terms, as well as for “short supply chains”; (iv) introducing the possibility to grant Union financial support to Member States for measures undertaken by operators in periods of severe market imbalances; and (v) improving the degree of organisation of the farming sector in Member States by supporting producer organisations implementing operational programmes, and improving the take-up of sectoral interventions in the other sectors as referred to in Article 42(f) of Regulation (EU) 2021/2115. The amendments maintain the level-playing field between producers and the degree of harmonisation already achieved by the existing Regulations. It is therefore considered that they cannot be implemented by Member States acting alone. • Proportionality The proposal amends existing Regulations only to the extent strictly necessary to achieve the objectives outlined above, while ensuring that the amendments remain targeted and providing for appropriate flexibilities. The proposed amendments modify only specific aspects of a limited number of provisions in the existing Regulations. They enhance and further strengthen existing provisions regarding contracts involving farmers and their organisations with other actors in the chain, as well as reinforce the bargaining power of producer organisations and their associations, reduce the administrative burden for their recognition, and establish an inducive framework for voluntary schemes and agreements aimed at improving farmers’ remuneration and social sustainability initiatives. • Choice of the instrument Since this proposal amends existing Regulations of the European Parliament and of the Council, the amendments must also be introduced by a Regulation of the European Parliament and of the Council. 3. RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS • Ex-post evaluations/fitness checks of existing legislation The proposal for targeted changes to the CMO Regulation and other CAP-related Regulations is one of the measures announced in the Commission’s reflection paper of 15 March 2024. Due to the urgency to respond to the pressing challenges that the agricultural sector is currently facing and the urgency to act to respond to farmer protests, no ex-post evaluation/fitness check of existing legislation was conducted. EN 3 EN  • Stakeholder consultations Due to the urgency to act to respond to the pressing challenges of the European agricultural sector, no call for evidence or public consultation have been conducted. However, relevant stakeholders were consulted through targeted meetings (see ‘Collection and use of expertise’). • Collection and use of expertise While no call for evidence or public consultation were conducted due to the urgency to act, the Commission has presented the proposed measures several times to the Council, an enlarged Civil Dialogue Group meeting with the relevant stakeholders, the European Network of the Competition authorities and in bilateral meetings involving all relevant EU based associations within the agri-food supply chain, including consumers. • Impact assessment In view of the urgency to act to respond to the pressing challenges that the agricultural sector is currently facing, no impact assessment could be conducted. However, the measures proposed have been developed on the basis of input received from stakeholders, in particular the enlarged Civil Dialogue Group meeting, the European Network of the Competition authorities and in bilateral meetings involving all relevant EU based associations within the agri-food supply chain, including consumers, as well as from the Chairman of the European Parliament’s Committee for agriculture and rural development. They are also in line with the relevant recommendations of the Strategic Dialogue on the Future of EU Agriculture of September 2024. The impact of the proposal will depend on the take-up of certain voluntary measures by farmers and buyers of agricultural products, as well as on the decisions of Member States to make use of the options and derogations provided. A staff working document will be produced within three months after the adoption of the proposal. It will clearly describe the issues addressed, the targeted changes proposed and their likely impact, as well as a summary of stakeholder feedback received. • Regulatory fitness and simplification The present proposal is one of the measures announced in the Commission’s Reflection Paper of 15 March 2024 as part of the Simplification Package. Quantification of the reduced administrative burden will be presented in the staff working document, to the extent possible. • Fundamental rights This proposal respects the fundamental rights and observes the principles recognised by, in particular, the Charter of Fundamental Rights of the European Union. 4. BUDGETARY IMPLICATIONS This proposal does not have any quantifiable budgetary impact. While measures 12-17 (listed under Point 5 Other elements – Detailed explanation of the specific provisions of the proposal) may accelerate the implementation of operational programmes by producer organisations and consequently increase the expenditure, any related expenditure will remain under the EAGF sub-ceiling. As regards the agricultural reserve funded under EAGF, the proposal does not provide for any changes to its overall amount. While the use of the reserve to finance measures adopted pursuant to Article 222 CMO may have consequences regarding the possible allocation of EN 4 EN  amounts for other exceptional measures in a given year, these cannot be quantified at this stage. The Union financial assistance of fruit and vegetables’ producer organisations approved by Member States for the implementation of operational programmes will be limited to a certain percentage (from 4.1 % to 5.5 % depending on the type of beneficiaries and the objectives pursued) of the value of marketed production of those producer organisations. The proposal contains provisions giving Member States a degree of flexibility in relation to the financial allocations for types of intervention in form of direct payments and for types of intervention in ‘other’ sectors. The funds made available for Union financial assistance to producer organisations operating in ‘other’ sectors will be limited to amounts transferred (within the limits of the related legal provision) from direct payments decided by the Member States and approved by the Commission. In case Member States decide to use that flexibility, it will impact solely the allocations of direct payments and ‘other’ sectors, and the change remains within EAGF. The impact cannot be quantified at this stage. 5. OTHER ELEMENTS • Implementation plans and monitoring, evaluation and reporting arrangements The present proposal amends Regulation (EU) No 1308/2013, Regulation (EU) 2021/2115 and Regulation (EU) 2021/2116. Therefore, the implementation plan and monitoring, evaluation and reporting arrangements remain the same as under the current framework. • Explanatory documents (for directives) Not applicable (the legal text is a Regulation) • Detailed explanation of the specific provisions of the proposal First, minimum requirements for the use of terms describing commercial modalities ensuring the fair allocation of value-added to farmers should be established. The aim is to increase the transparency and reliability of the use of those terms to ensure the fair allocation of value- added along the food supply chain, to prevent the misuse of such terms and to ensure that consumers have reliable information about the fair allocation of value-added to farmers and short supply chains. Second, each delivery of agricultural products should be covered by a written contract, subject to certain exceptions and to the possibility for the Member States to exempt certain agricultural products from that requirement. Third, written contracts should include certain elements ensuring transparency and predictability in the calculation of the final price. Fourth, contracts with a duration of more than six months should include a revision clause to allow farmers, producer organisations or associations of producer organisations to request a revision of the contract, in particular in situations where the price would no longer cover production costs and to terminate the contract if such request is refused. Fifth, Member States should establish a mediation mechanism and make it available to parties that wish to use it. Sixth, existing rules on the definition and recognition of producer organisations should be simplified. Moreover, to enhance collaboration between organic product producers, the EN 5 EN  establishment and recognition of producer organisations by those producers should be made explicitly possible. Seventh, existing rules on producer organisations should be clarified to ensure that producer organisations are established at the initiative of farmers and are controlled in accordance with rules that enable farmer members to scrutinise democratically their organisations and the decisions of such organisations. Eighth, it should be permitted for non-recognised producer organisations, including cooperatives, to negotiate contract terms, on behalf of their members for some or all of their production. Ninth, recognised associations of producer organisations should be able to negotiate contract terms on behalf of their recognised producer organisations members. Tenth, the promotion of the use of initiatives with optional terms used to designate commercial modalities, such as ‘fair’, ‘equitable’ or their equivalent terms and ‘short supply chain’ should be included in the list of objectives that a recognised interbranch organisation can pursue. Eleventh, vertical and horizontal cooperation initiatives concerning agricultural and food products, which aim to apply certain social sustainability requirements that are more stringent than the mandatory requirements, should not be subject to the application of Article 101(1) TFEU. Twelfth, Regulation (EU) 2021/2115 should be amended as regards the types of interventions in certain sectors. Moreover, the Union financial assistance to operational programmes in certain sectors should be increased. Thirteenth, the Union financial support to operational programmes implemented by producer organisations in the fruit and vegetable sector in Member States in which the degree of organisation of producers is below 10 % for three consecutive years preceding the implementation of the operational programme should be increased from 50 % to 60 %. Fourteenth, a specific incentive should be granted to young farmers and new farmers joining a recognised producer organisation and who undertake investments implemented at their premises. Fifteenth, the Union financial support to producer organisations and associations of producer organisations in the event of adverse meteorological events, natural disasters, plant diseases or pest infestations should be increased from 50 % to 70 % of the actual expenditure incurred, under certain conditions. Sixteenth, Member States should be allowed, as of 2025, to use up to 6 % of their allocations of direct payments to support the sectors set out in Article 1(2), points (a) to (h), (k), (m), (o) to (t) and (w), of Regulation (EU) No 1308/2013 and sectors covering products listed in Annex VI to Regulation (EU) 2021/2115. Seventeenth, Regulation (EU) 2021/2116 should be amended to enable the use of the agricultural reserve in support of specific categories of collective actions by certain private operators adopted with a view to stabilise the sectors concerned by a severe market imbalance. EN 6 EN  2024/0319 (COD) Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulations (EU) No 1308/2013, (EU) 2021/2115 and (EU) 2021/2116 as regards the strengthening of the position of farmers in the food supply chain THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty on the Functioning of the European Union, and in particular Article 42, first subparagraph, and Article 43(2) thereof, Having regard to the proposal from the European Commission, After transmission of the draft legislative act to the national parliaments, Having regard to the opinion of the Court of Auditors1, Having regard to the opinion of the European Economic and Social Committee2, Having regard to the opinion of the Committee of the Regions3, Acting in accordance with the ordinary legislative procedure, Whereas: (1) The agricultural sector, in particular farmers, face a range of challenges. The Covid-19 pandemic and Russia’s ongoing war of aggression against Ukraine have led to an unprecedented increase of energy-related agricultural input costs and a prolonged period of high inflation, affecting farmers’ costs and food prices. In parallel, farmers continue to undertake efforts to make their production more environmentally sustainable. Many consumers, dealing with an increased cost of living, have also directed their consumption patterns towards less expensive food products. This has further destabilised the distribution of value added along the food supply chain and has increased the degree of uncertainty in which farmers operate, fuelling protests and mistrust. It is thus appropriate to adopt measures to tackle those challenges and restore the trust of the actors in the food supply chain. (2) Various operators within the agricultural and food supply chain, active at different stages of production, processing, marketing, distribution, and retail, have developed schemes and labels to promote commercial modalities ensuring the fair allocation of value added to farmers and the creation and maintenance of short supply chains. Establishing minimum requirements for the use of optional terms describing those commercial modalities is necessary to increase the transparency and reliability of the use of those terms in the food supply chain, complementing existing food labelling 1 OJ C, … 2 OJ C, … 3 OJ C, … EN 7 EN  rules, in particular Regulation (EU) No 1169/2011 of the European Parliament and of the Council4. (3) In the interest of increased trust and fairness along the food supply chain, the terms ‘fair’, ‘equitable’ or equivalent terms, should be used only to designate commercial modalities that ensure stability and transparency in commercial relations between farmers and purchasers and pricing considered equitable by participating farmers, and that support and contribute to the United Nations Sustainable Development Goals, including in a manner that is consistent with Annex I of Directive (EU) 2024/1760 of the European Parliament and of the Council5. (4) The term ‘short supply chain’ should be used only to designate commercial modalities where a direct connection exists between farmers and consumers that allows to directly exchange on the production process and the product, including by means of distance communication and/or via an intermediary who ensures such exchange at the moment of sale. Alternatively, this term may also be used where a close connection between farmers and consumers within their geographic proximity exists, including in cross-border contexts. This will incentivise consumers to pay prices that fairly remunerate farmers for what they produce, strengthen and contribute to the development of rural areas, improve transparency regarding the origin and production methods of the products. (5) In light of market conditions, evolving consumer expectations, advances both in marketing standards and in relevant international standards, implementing powers should be conferred on the Commission to ensure uniform conditions for the use of the optional terms designating commercial modalities related to the fair allocation of value added to farmers and the creation and maintenance of short supply chains. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council6. (6) For those same reasons, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission in respect of additional optional terms that are equivalent to the terms ‘fair’ or ‘equitable’. (7) While Member States may retain or introduce national provisions stipulating supplementary requirements for the use of optional terms for commercial modalities, those provisions should not hinder, limit, or obstruct the use of these terms for products legally produced or marketed in another Member State. 4 Regulation (EU) No 1169/2011 of the European Parliament and of the Council of 25 October 2011 on the provision of food information to consumers, amending Regulations (EC) No 1924/2006 and (EC) No 1925/2006 of the European Parliament and of the Council, and repealing Commission Directive 87/250/EEC, Council Directive 90/496/EEC, Commission Directive 1999/10/EC, Directive 2000/13/EC of the European Parliament and of the Council, Commission Directives 2002/67/EC and 2008/5/EC and Commission Regulation (EC) No 608/2004 (OJ L 304, 22.11.2011, p. 18, ELI: http://data.europa.eu/eli/reg/2011/1169/oj). 5 Directive (EU) 2024/1760 of the European Parliament and of the Council of 13 June 2024 on corporate sustainability due diligence and amending Directive (EU) 2019/1937 and Regulation (EU) 2023/2859, (OJ L, 2024/1760, 5.7.2024, ELI: http://data.europa.eu/eli/dir/2024/1760/oj). 6 Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by the Member States of the Commission's exercise of implementing powers (OJ L 55, 28.2.2011, p. 13, ELI: http://data.europa.eu/eli/reg/2011/182/oj). EN 8 EN  (8) The use of written contracts plays a crucial role in the accountability of operators, raising awareness about the importance of market signals, adapting supply to demand, improving price transmission within the supply chain, enhancing transparency and preventing and addressing unfair trading practices. The rules on contractual relations in the milk and milk products sector should therefore be extended to cover products other than raw milk, while ensuring alignment with the rules on contractual relations applicable to other agricultural sectors. (9) In order to increase flexibility for Member States and simplify the procedure for the recognition of producer organisations, thereby reducing transaction costs and improving efficiency, the rules on producer organisations should allow for their recognition following a single request covering multiple sectors and products. Moreover, to enhance collaboration between organic product producers, the establishment and recognition of producer organisations by organic product producers should be explicitly provided for. The criteria for the recognition of producer organisations and their statutes should also provide that producer organisations are established at the initiative of farmers and are controlled in accordance with rules that enable farmer members to scrutinise democratically their organisation and decisions. This should not preclude other producers that are not farmers, and non-producers from joining producer organisations. (10) To promote further sustainable development, which is a core principle of the Treaty and a priority objective for the policies of the Union, and to ensure transparency, stability and fairness in commercial relations between farmers and purchasers throughout the supply chain, Member States should be able to recognise producer organisations that pursue specific aims with optional terms for commercial modalities, such as ‘fair’, ‘equitable’ or equivalent terms, and ‘short supply chain’. (11) To ensure a fair standard of living for farmers, enhance their bargaining position vis-à- vis processors and other actors in the supply chain and provide for a fairer distribution of added value along the supply chain, the possibility of negotiating contract terms on behalf of their members should be extended to non-recognised producer organisations, including cooperatives, for some or all of their production. To ensure equal treatment with members of recognised producer organisations, this possibility should be subject to appropriate limits. In particular, non-recognised producer organisations benefiting from that possibility should comply with the recognition criteria set at Union level and engage in the activities set out in Regulation (EU) No 1308/2013 of the European Parliament and of the Council7, including concentrating supply and placing their members’ products on the market. (12) To strengthen the negotiating position of recognised producer organisations and to ensure the viable development of agricultural production, recognised associations of producer organisations should be allowed to negotiate contract terms on behalf of their members, including price, for some or all of their members’ production. This possibility should be allowed, subject to the safeguard that the organisations which are members of those associations are not also members of another association of producer organisations and the volume of products covered by the activities of the 7 Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013 establishing a common organisation of the markets in agricultural products and repealing Council Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007 (OJ L 347, 20.12.2013, p. 671, ELI: http://data.europa.eu/eli/reg/2013/1308/oj). EN 9 EN  association does not exceed 33% of the total national production of any given Member State. In order to maintain effective competition on the market, recognised associations of producer organisations should also not be allowed to negotiate contract terms where those associations include non-recognised producer organisations. (13) To prevent purchasers from undermining the bargaining position of producer organisations, appropriate safeguards should be established for contacts between purchasers and members of those producer organisations. While purchasers may contact members of producer organisations, those contacts should not undermine the objectives of the producer organisations, or the concentration of supply and placing of products on the market. (14) Interbranch organisations play an important role in facilitating dialogue between actors in the supply chain, and in promoting best practices, market transparency, stability and fairness in commercial relations between farmers and purchasers throughout the supply chain. It is therefore appropriate to include the promotion of initiatives for the inclusion of optional terms for commercial modalities, such as ‘fair’, ‘equitable’ or equivalent terms, and ‘short supply chain’ in the list of objectives that a recognised interbranch organisation may pursue. (15) Certain Member States have decided that all deliveries of agricultural products in their territory are to be covered by written contracts between the parties. Where the Member States do not make use of this possibility, farmers, producer organisations or associations of producer organisations can request the use of written contracts. However, due to the weaker bargaining position of farmers and the fear of commercial retaliation by purchasers, it can be difficult for farmers and their associations to make such a request. To increase trust, transparency, and efficiency within the supply chain and to enable all farmers, producer organisations and associations of producer organisations to benefit from the use of written contracts, deliveries of agricultural products in the Union by a farmer, a producer organisation or an association of producer organisations to a processor, distributor or retailer should be covered by a written contract. (16) To better take into account the signals of the market and to improve price transmission, Member States should be able to require the use of written contracts for the delivery of agricultural products by producers other than farmers, by producer organisations or associations of producer organisations, and to require that purchasers make use of written offers for contracts for the delivery of agricultural products. In the interests of simplicity and reduction of transaction costs, this Regulation should lay down certain exceptions to the required use of written contracts or written offers for contracts and allow Member States to exempt certain deliveries from the required use of written contracts or written offers, while leaving farmers and their associations the possibility of requesting the use of written contracts or written offers when there is no such obligation. (17) The required use of written contracts for the delivery of agricultural products and the basic conditions for their use should be laid down at Union level, while ensuring that the right of the parties to negotiate all elements of their contracts is not restricted beyond what is strictly necessary. (18) To encourage parties to reach an amicable settlement in case of disputes over the conclusion or review of a written contract, Member States should establish mediation mechanisms. Member States should inform the Commission about the mediation EN 10 EN  mechanisms in place in their territory or the establishment of those mechanisms, and the Commission may facilitate exchanges of best practices about those mechanisms. (19) To facilitate the functioning of price transmission mechanisms, where the final price payable for the delivery of agricultural products is calculated by combining various factors set out in the contract, those factors should include objective indicators, indices or methods of calculation that are easily understandable by the parties. To avoid that farmers are forced to sell systematically below their production costs, the indicators, indices and methods of calculation of the final price should reflect changes in market conditions and production costs of the agricultural products delivered. (20) Considering the vulnerable negotiating position of farmers and their organisations, recent instances of significant volatility in agricultural input costs and market prices, and the need for a more efficient price transmission within the supply chain, contracts with a duration of more than 6 months should include a revision clause that may be triggered by the farmers and their organisations. Such a clause should permit farmers to request after the 6 months at any moment a revision of the elements of the contract and permit them to end the contract in case no agreement on a revision is reached, without interfering with the right of the parties to negotiate other possibilities for the revision of the contract. (21) To enhance contractual transparency and contribute to fairer trading practices, Member States should be able to require the registration of written contracts for the delivery of agricultural products. (22) Certain vertical and horizontal cooperation initiatives concerning agricultural and food products, which aim to apply requirements that are more stringent than the mandatory requirements, can have positive effects on the objective of the common agricultural policy to ensure a fair standard of living for the agricultural community and on the objective of sustainable development of the Union. Therefore, under specific circumstances, such initiatives should not be subject to the application of Article 101(1) of the Treaty on the Functioning of the European Union. (23) In periods of severe market imbalance, specific categories of collective actions by private operators can contribute to stabilise the sectors concerned. With a view to ensuring that private operators have the necessary resources to implement these actions, the Commission should be able to make available Union resources from the agricultural reserve to support these actions. Member States should also be able to allocate additional national resources. (24) To enable sugar beet growers to benefit from enhanced contractual clarity and to ensure a harmonised contractual framework while taking account of the specificity of the sugar beet sector, purchase terms in contracts for the delivery of sugar beet should be aligned with the conditions for the use of written contracts in other agricultural sectors. (25) Regulation (EU) No 1308/2013 should therefore be amended accordingly. (26) To strengthen the position of farmers in the food supply chain, several provisions of Regulation (EU) 2021/2115 of the European Parliament and of the Council8 should be 8 Regulation (EU) 2021/2115 of the European Parliament and of the Council of 2 December 2021 establishing rules on support for strategic plans to be drawn up by Member States under the common agricultural policy (CAP Strategic Plans) and financed by the European Agricultural Guarantee Fund (EAGF) and by the European Agricultural Fund for Rural Development (EAFRD) and repealing EN 11 EN  amended as regards the types of intervention in certain sectors. These amendments aim to support farmers to become or remain members of producer organisations or associations of producer organisations recognised under Regulation (EU) No 1308/2013, in light of the positive role these organisations and associations play in strengthening the bargaining power of producers. Moreover, to ensure a more efficient and targeted support of producer organisations through the CAP Strategic Plans, the possibility of an increase of the Union financial assistance to operational programmes in certain sectors should be provided for. (27) The value of production of fruit and vegetables marketed by producer organisations compared to the total value of the fruit and vegetable production remains in certain Member States far below the Union average. Among the financial incentives available, Member States can already provide national financial assistance as provided for in Article 53 of Regulation (EU) 2021/2115 to producer organisations located in certain regions where the degree of organisation is significantly below the Union average. With a view to enhancing competitiveness, strengthening farmers’ positions in the value chain and setting up new producer organisations, a financial incentive consisting in an increase of 10 % of the Union financial assistance should be granted to producer organisations in Member States, in which the degree of organisation of producers is below 10 % for 3 consecutive years preceding the implementation of the relevant operational programme. (28) With a view to facilitating the generational renewal in the farming sector and encouraging entrance of new producer members in producer organisations in the fruit and vegetables sector and in other sectors as referred to in Article 42, point (f), of Regulation (EU) 2021/2115, a particular incentive should be granted to young farmers and new farmers who join a producer organisation recognised under Regulation (EU) No 1308/2013. Consequently, a possible increase of 10 % of the Union financial assistance for expenditure related to investments made at the premises of a young farmer or a new producer who joins a recognised producer organisation for the first time should be made available. (29) Given the recurrence of adverse climatic events, natural disasters, plant diseases or pest infestations in recent years, it has proven useful for producer organisations and associations of producer organisations to be able to redirect funds, including Union financial assistance within the operational fund, to interventions required to address the consequences of those events. It is therefore necessary to provide for the possibility of increasing the Union financial assistance laid down in Article 52(1) of Regulation (EU) 2021/2115 from 50% to 70% of the actual expenditure incurred, under certain conditions. (30) In order to support the setting-up of types of intervention in the other sectors referred to in Article 42, point (f), of Regulation (EU) 2021/2115, Member States should be allowed, as of 2025, further flexibility to adjust the allocation of funds to these sectors by using up to 6 % of their allocations for direct payment. (31) Regulation (EU) 2021/2115 should therefore be amended accordingly, (32) With a view to ensuring that Union resources from the agricultural reserve can be made available to the Member States in order to support collective actions by private Regulations (EU) No 1305/2013 and (EU) No 1307/2013, (OJ L 435, 6.12.2021, p. 1, ELI: http://data.europa.eu/eli/reg/2021/2115/oj). EN 12 EN  operators in periods of severe market imbalance, the possibility to use the agricultural reserve should be extended to the support of collective actions when the Commission decides that competition rules do not apply to those actions. (33) Article 16 of Regulation (EU) 2021/2116 of the European Parliament and of the Council9 should therefore be amended accordingly. (34) In order to give the market operators the necessary time to adapt and to allow the Commission to assess existing national schemes and practices, the application of the rules relating to the reservation of the optional terms ‘fair’, ‘equitable’ and their equivalent terms, and the term ‘short supply chains’, should be deferred by 2 years after the entry into force of this Regulation. Additionally, in order for operators to adapt their contractual relations to the new rules on written contracts, the application of those rules should be deferred by 18 months after its entry into force. HAVE ADOPTED THIS REGULATION: Article 1 Amendments to Regulation (EU) No 1308/2013 Regulation (EU) No 1308/2013 is amended as follows: (1) In Part II, Title II, Chapter I, Section 1, the following subsection is inserted after Subsection 3: ‘Subsection 3a Use of optional terms for products in all sectors listed in Article 1(2) Article 88a Optional terms for commercial modalities 1. The terms ‘fair’, ‘equitable’ or terms equivalent to these terms may be used only, alone or in combination with other terms, on the labelling, in the presentation, on advertising material or on commercial documents of a product of the sectors listed in Article 1(2) that is placed on the market, provided that these terms are used to inform purchasers about existing modalities for the organisation of production, distribution, or placing on the market, which contribute at least to: (a) stability and transparency in the relations of farmers with purchasers along the supply chain, (b) a price considered equitable by participating farmers for their products, and 9 Regulation (EU) 2021/2116 of the European Parliament and of the Council of 2 December 2021 on the financing, management and monitoring of the common agricultural policy and repealing Regulation (EU) No 1306/2013, (OJ L 435, 6.12.2021, p. 187, ELI: http://data.europa.eu/eli/reg/2021/2116/oj). EN 13 EN  (c) collective initiatives pursuing one or several of the United Nations Sustainable Development Goals. 2. The term ‘short supply chain’ may be used only, alone or in combination with other terms, on the labelling, in the presentation, on advertising material or on commercial documents of a product of the sectors listed in Article 1(2) that is placed on the market, provided that the term is used to inform purchasers about existing modalities for the organisation of production, distribution, or placing on the market, which provide for: (a) a direct connection between the farmer and the final consumer of the product, or (b) a close connection and geographical proximity between the farmer and the final consumer of the product. 3. The Commission may adopt implementing acts to specify further the conditions referred to in paragraph 1, points (a), (b) and (c), and in paragraph 2, points (a) and (b), taking into account any relevant international standard. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 229(2). 4. The Commission is empowered to adopt delegated acts in accordance with Article 227, amending paragraph 1 to add terms that are equivalent to the terms ‘fair’ or ‘equitable’, when such equivalent terms are used on the market to inform purchasers about the commercial modalities referred to in paragraph 1. 5. Member States may adopt or maintain national rules laying down conditions additional to those referred to in paragraph 1, points (a), (b) and (c) and in paragraph 2, points (a) and (b), for the use of the terms referred to in paragraphs 1 and 2 respectively. Such rules shall not prohibit, restrict or impede the use of the terms referred to in paragraphs 1 and 2 for products that are legally produced or marketed in another Member State under the terms referred to in paragraphs 1 and 2. 6. This Article shall be without prejudice to the rules laid down in Regulation (EU) No 1169/2011.’; (2) Article 148 is replaced by the following: ‘Article 148 Contractual relations in the milk and milk products sector 1. Every delivery in the Union of milk and milk products by a farmer, a producer organisation or an association of producer organisations, to a processor, collector, distributor or retailer shall be covered by a written contract between the parties. EN 14 EN  Such contract shall fulfil the conditions laid down in paragraphs 4 and 8. For the purposes of this Article, a "collector" means an undertaking that transports raw milk from a farmer or another collector to a processor of raw milk or another collector, where the ownership of the raw milk is transferred in each case. 2. Member States may also decide that: a) the delivery of milk and milk products by a producer other than a farmer, a producer organisation or an association of producer organisations to a processor, collector, distributor or retailer shall be covered by a written contract; b) the first purchasers of milk and milk products shall make a written offer for a contract for the delivery of milk and milk products by the farmer, a producer organisation or an association of producer organisations. Such a contract or offer for a contract shall fulfil the conditions laid down in paragraphs 4 and 8. 3. Member States shall establish a mediation mechanism to cover cases in which there is no mutual agreement to conclude a contract referred to in paragraphs 1 and 2 or to revise such a contract. Member States shall inform the Commission of the mediation mechanisms established in their territory. 4. The contract or the offer for a contract referred to in paragraphs 1 and 2 shall: (a) be made in advance of the delivery, (b) be made in writing, and (c) include, in particular, the following elements: (i) the price payable for the delivery, which shall: – be static and set out in the contract; or – be calculated by combining various factors set out in the contract, which shall include objective indicators, indices or methods of calculation of the final price, that are easily accessible and comprehensible and that reflect changes in market conditions and production costs, the quantities delivered and the quality or composition of the milk and milk products delivered. To that effect, Member States may determine indicators, in accordance with objective criteria based on studies carried out on production and the food supply chain. The parties to the contracts shall be free to refer to these indicators or any other indicators; (ii) the volume of raw milk or the quality and quantity of milk or milk products to be delivered, and the timing of such deliveries; (iii) the duration of the contract, which may include a definite duration or an indefinite duration with a termination clause. In the case of a contract EN 15 EN  with a minimum duration longer than six months, the contract shall include a revision clause that may be triggered by the farmer, a producer organisation or an association of producer organisations; (iv) details regarding payment periods and procedures; (v) arrangements for collecting or delivering milk or milk products; and (vi) rules applicable in the event of force majeure. 5. By way of derogation from paragraphs 1 and 2, a written contract or a written offer for a contract shall not be required in the following cases: (a) the milk or the milk products concerned are delivered by a member of a producer organisation or cooperative to the producer organisation or cooperative of which it is a member provided that the statutes of that producer organisation or cooperative or the rules and decisions provided for in, or derived from, these statutes contain provisions having similar effects to the provisions set out in paragraph 4; (b) the first purchaser of milk or milk products is a micro or small-sized enterprise within the meaning of Recommendation 2003/361/EC10; (c) the delivery and the payment for the milk or milk products take place simultaneously; (d) the delivery is made for free or in the context of the disposal of milk or milk products which are no longer fit for sale. 6. Member States may decide that a written contract or a written offer shall not be required in one or more of the following cases: (a) the delivery concerns products of a value equal to or below a threshold to be determined by the Member State, which shall not exceed EUR 10 000; (b) the delivery concerns milk and milk products that are subject to seasonal supply or demand fluctuations or perishability; (c) the delivery concerns milk and milk products that are subject to traditional or customary selling practices. 7. Where pursuant to paragraph 5, points (b), (c) and (d), or paragraph 6, a written contract or a written offer for a contract is not required, a farmer, a producer organisation, or an association of producer organisations may require that a delivery of milk or milk products be the subject of a written contract or of a written offer for a contract. Such a contract or offer for a contract shall fulfil the conditions laid down in paragraph 4 and paragraph 8, first subparagraph. 8. All elements of contracts for the delivery of milk or milk products concluded between farmers, producer organisations or associations of producer organisations and collectors, processors, distributors or retailers, including the elements and their components referred to in paragraph 4, point (c), shall be freely negotiated between the parties. 10 Commission Recommendation of 6 May 2003 concerning the definition of micro, small and medium- sized enterprises, (OJ L 124, 20.5.2003, p. 36, http://data.europa.eu/eli/reco/2003/361/oj). EN 16 EN  Member States may establish one or more of the following: (a) in respect of the written contracts referred to in paragraph 1 of this Article: (i) an obligation for the parties to agree on a relationship between a given quantity of milk or milk products delivered and the price payable for that delivery; (ii) a minimum duration which shall be at least six months and shall not impair the proper functioning of the internal market; (b) in respect of the written offers referred to in paragraph 2, point (b), an obligation that the written offer shall include a minimum duration for the contract, set by national law. Such a minimum duration shall be at least six months and shall not impair the proper functioning of the internal market. Farmers, producer organisations or associations of producer organisations may refuse in writing the minimum duration imposed pursuant to the second sub-paragraph. 9. Member States may require the purchaser of milk or milk products to register the written contracts referred to in paragraph 1 prior to the delivery of the milk or milk products concerned by the farmer, a producer organisation or an association of producer organisations to a collector, processor, distributor or retailer in their territory. 10. Member States that make use of the options referred to in paragraphs 2, 6, 8 and 9 shall notify the Commission of how they are applied. 11. The Commission may adopt implementing acts laying down measures necessary for the uniform application of paragraphs 4 and 5 and measures relating to notifications to be made by the Member States in accordance with paragraph 10. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 229(2).’; (3) Article 152 is amended as follows: (a) paragraph 1 is amended as follows: (i) point (a) is replaced by the following: ‘(a) are constituted by producers in one or several sectors listed in Article 1(2) or by producers of organic products in one or several sectors listed in Article 1(2), and are controlled by farmer members, in accordance with Article 153(2), point (c);’; (ii) in point (b), the introductory sentence is replaced by the following: ‘(b) are formed on the initiative of farmers and carry out at least one of the following activities:’; (iii) point (c)(vi) is replaced by the following: ‘(vi) promoting and providing technical assistance for the use of production standards, improving product quality and developing products with a protected EN 17 EN  designation of origin, with a protected geographical indication or covered by a national quality label, carrying out initiatives promoting short supply chains or the use of the optional terms referred to in Article 88a;’; (b) in paragraph 1a, the first subparagraph is replaced by the following: ‘1a. By way of derogation from Article 101(1) TFEU, a producer organisation recognised under paragraph 1 of this Article, or a producer organisation, including a cooperative, that has not been recognised as a producer organisation by a Member State, but meets the requirements set out in paragraph 1 of this Article and of Article 154, may plan production, optimise the production costs, place on the market and negotiate contracts for the supply of agricultural products, on behalf of its members for all or part of their total production.’; (c) in paragraph 1b, the following second subparagraph is inserted: ‘By way of derogation from paragraph 1a and the first subparagraph, an association of producer organisations recognised under Article 156(1) may also carry out the activities referred to in paragraph 1a, first subparagraph, provided that: (a) its members have been recognised in accordance with paragraph 1 of this Article, (b) its members are not members of another recognised association of producer organisations for any given product, (c) its members comply with the conditions of paragraph 1a, second subparagraph, points (a) and (b), (d) the volume of products covered by the activities referred to in the first subparagraph of paragraph 1a does not exceed 33% of the total national production of any given Member State.’; (4) Article 153 is amended as follows: (a) in paragraph 2, point (c) is replaced by the following: ‘(c) rules enabling the farmer members to scrutinise democratically their organisation and its decisions as well as its accounts and budgets;’; (b) paragraph 2a is replaced by the following: ‘2a. The statutes of a producer organisation may provide for the possibility of members being in direct contact with purchasers, provided that such direct contact does not jeopardise the objectives pursued by the producer organisation, or the concentration of supply and placing of products on the market by the producer EN 18 EN  organisation. Concentration of supply shall be deemed to have been ensured if the essential elements of the sales such as price, quality and volume are negotiated and determined by the producer organisation.’; (c) paragraph 3 is replaced by the following: ‘3. Paragraphs 1 and 2 shall not apply to producer organisations in the milk and milk products sector.’; (5) in Article 157(1), point (c), the following point is added: ‘(xvii) promoting the use of the optional terms referred to in Article 88a.’; (6) Article 168 is replaced by the following: ‘Article 168 Contractual relations 1. Every delivery in the Union of agricultural products from a sector listed in Article 1(2), other than milk and milk products and sugar, by a farmer, a producer organisation or an association of producer organisations to a processor, distributor or retailer, shall be covered by a written contract between the parties. Such contract shall fulfil the conditions laid down in paragraphs 4 and 8. 2. Member States may also decide that: (a) the delivery of agricultural products by a producer other than a farmer, a producer organisation or an association of producer organisations to a processor, distributor or retailer shall be covered by a written contract, (b) the first purchaser of the agricultural product shall make a written offer for a contract for the delivery of agricultural products by the farmer, a producer organisation or an associations of producer organisations. Such a contract or offer for a contract shall fulfil the conditions laid down in paragraphs 4 and 8. 3. Member States shall establish a mediation mechanism to cover cases in which there is no agreement to conclude such a contract referred to in paragraphs 1 and 2 or to revise such a contract. Member States shall inform the Commission about the mediation mechanisms established in their territory. 4. The contract or the offer for a contract referred to in paragraphs 1 and 2 shall: (a) be made in advance of the delivery, (b) be made in writing, and EN 19 EN  (c) include, in particular, the following elements: (i) the price payable for the delivery, which shall: – be static and set out in the contract or – be calculated by combining various factors set out in the contract, which shall include objective indicators, indices or methods of calculation of the final price, that are easily accessible and comprehensible and that reflect changes in market conditions and production costs, the quantities delivered and the quality or composition of the agricultural products delivered; to that effect, Member States may determine indicators, in accordance with objective criteria based on studies carried out on production and the food supply chain. The parties to the contracts shall be free to refer to these indicators or any other indicators which they deem relevant. (ii) the quantity and quality of the agricultural products concerned which may or must be delivered and the timing of such deliveries, (iii) the duration of the contract, which may include either a definite duration or an indefinite duration with a termination clause. In the case of contracts with a minimum duration longer than six months, the contract shall also include a revision clause that may be triggered, in particular, by the farmer, a producer organisation or an association of producer organisations; (iv) details regarding payment periods and procedures, (v) arrangements for collecting or delivering the agricultural products, (vi) rules applicable in the event of force majeure. 5. By way of derogation from paragraphs 1 and 2, a written contract or a written offer for a contract shall not be required in the following cases: (a) The agricultural products concerned are delivered by a member of a producer organisation or cooperative to the producer organisation or cooperative of which they are a member provided that the statutes of that producer organisation or cooperative or the rules and decisions provided for in, or derived from, these statutes contain provisions having similar effects to the provisions set out in points (a), (b) and (c) of paragraph 4; (b) the first purchaser of the agricultural products concerned is a micro or small- sized enterprise within the meaning of Recommendation 2003/361/EC; (c) the delivery and payment of the agricultural products concerned take place simultaneously; (d) the delivery is made for free or in the context of the disposal of -products which are no longer fit for sale. 6. Member States may decide that a written contract or a written offer shall not be required in one or more of the following cases: (a) the delivery concerns products of a value equal to or below a certain threshold of value to be determined by the Member State, and which shall not exceed EUR 10 000; EN 20 EN  (b) the delivery concerns agricultural products that are subject to seasonal supply or demand fluctuations or perishability; (c) the delivery concerns agricultural products that are subject to traditional or customary selling practices. 7. Where pursuant to paragraph 5, points (b), (c) and (d), or paragraph 6, a written contract or a written offer for a contract is not required, a farmer, a producer organisation or an association of producer organisations, may require that any delivery of agricultural products to a processor, distributor or retailer be the subject of a written contract between the parties or of a written offer for a contract. Such a contract or offer for a contract shall fulfil the conditions laid down in paragraph 4 and paragraph 8, first subparagraph. 8. All elements of contracts for the delivery of agricultural products concluded between farmers, producer organisations or association of producer organisations, and processors, distributors, or retailers including those elements and their components referred to in paragraph 4, point (c), shall be freely negotiated between the parties. Member States may establish one or more of the following: (a) in respect of the written contracts referred to in paragraph 1 of this Article, a Member State may establish: (i) an obligation for the parties to agree on a relationship between the given quantity of agricultural products delivered and the price payable for that delivery; (ii) a minimum duration, which shall be at least six months and shall not impair the proper functioning of the internal market; (b) in respect of the written offers referred to in point (b) of paragraph 2, an obligation that the written offer shall include a minimum duration for the contract, set by national law for this purpose. Such a minimum duration shall be at least six months and shall not impair the proper functioning of the internal market. Farmers, producer organisations or associations of producer organisations may refuse in writing the minimum duration imposed pursuant to the second sub-paragraph. 9. Member States may require the purchaser of agricultural products to register the written contracts referred to in paragraph 1 prior to the delivery of the agricultural products concerned by the farmer, a producer organisation, or an association of producer organisations to a processor, distributor or retailer in their territory. 10. Member States that make use of the options referred to in paragraphs 2, 6, 8 and 9 shall notify the Commission of how they are applied. 11. The Commission may adopt implementing acts laying down measures necessary for the uniform application of paragraphs 4 and 5 and measures relating to notifications to be made by the Member States in accordance with paragraph 10. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 229(2).’; (7) Article 210a is amended as follows: (a) in paragraph 3, the following points are added: EN 21 EN  ‘(d) supporting the economic viability of small farms predominantly relying on family labour with a standard output as defined in Article 2, point (8), of Council Regulation (EC) No 1217/200911 that shall not exceed 100 000 EUR; (e) attracting and supporting young producers of agricultural products; or (f) improving working and safety conditions in agricultural or processing activities.’; (b) paragraph 6 is replaced by the following: ‘From 8 December 2023, producers as referred to in paragraph 1 may request an opinion from the Commission concerning the compatibility of agreements, decisions and concerted practices as referred to in paragraph 1 with regard to the implementation of sustainability standards aiming to contribute to one or more of the objectives laid down in paragraph 3, points (a), (b) and (c), with this Article. From [entry into force +2 years], producers as referred to in paragraph 1 may request an opinion from the Commission concerning the compatibility of agreements, decisions and concerted practices as referred to in paragraph 1 with regard to the implementation of sustainability standards aiming to contribute to one or more of the objectives laid down in paragraph 3, points (d), (e) and (f), with this Article. The Commission shall send the applicant its opinion within four months of receipt of a complete request. If the Commission finds at any time after issuing an opinion that the conditions referred to in paragraphs 1, 3 and 7 of this Article are no longer met, it shall declare that Article 101(1) TFEU shall apply in the future to the agreement, decision or concerted practice in question and inform the producers accordingly. The Commission may change the content of an opinion at its own initiative or at the request of a Member State, in particular if the applicant has provided inaccurate information or misused the opinion.’; (8) in Article 222, paragraph 1 is replaced by the following: ‘1. During periods of severe imbalance in markets, the Commission may adopt implementing acts to the effect that Article 101(1) TFEU is not to apply to agreements and decisions of farmers, farmers' associations, or associations of such associations, or recognised producer organisations, associations of recognised producer organisations and recognised interbranch organisations in any of the sectors referred to in Article 1(2) of this Regulation, provided that such agreements and decisions do not undermine the proper functioning of the internal market, strictly aim to stabilise the sector concerned and fall under one or more of the following categories: 11 Council Regulation (EC) No 1217/2009 of 30 November 2009 setting up the Farm Sustainability Data Network (OJ L 328 15.12.2009, p. 27, ELI: http://data.europa.eu/eli/reg/2009/1217/oj). EN 22 EN  (a) market withdrawal or free distribution of their products; (b) transformation and processing; (c) storage by private operators; (d) joint promotion measures; (e) agreements on quality requirements; (f) joint purchasing of inputs necessary to combat the spread of pests and diseases in animals and plants in the Union or of inputs necessary to address the effects of natural disasters in the Union; (g) temporary planning of production taking into account the specific nature of the production cycle; Where the Commission adopts implementing acts in accordance with the first subparagraph of this Article, it may decide to make Union support from the agricultural reserve referred to in Article 16 of Regulation (EU) 2021/2116 available to the Member States concerned. Such financial support shall provide the means necessary for the implementation of these agreements and decisions by the operators concerned. The Commission shall specify in implementing acts the scope of the derogation of the first subparagraph, subject to paragraph 3 of this Article, the period for which the derogation applies, and, where applicable, the amount of the agricultural reserve allocated to the Member State concerned under the second subparagraph. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 229(2).’; (9) Annex X is amended as follows: (a) in Point I, point 1 is replaced by the following: ‘1. Delivery contracts shall be made in advance of the delivery, in writing for a specified quantity of beet.’; (b) in Point I, point 2 is replaced by the following: ‘2. The duration of the delivery contracts may be pluriannual. In the case of contracts with a minimum duration longer than six months, the contract shall include a revision clause that may be triggered by the farmer, a producer organisation or an association of producer organisations.’; EN 23 EN  (c) in Point II, point 2, the following paragraph is added: ‘The price shall be calculated by combining various factors set out in the contract, which shall include objective indicators, indices or methods of calculation of the final price, that are easily accessible and comprehensible and that reflect changes in market conditions and production costs, the quantities delivered and the quality or composition of sugar beet delivered. To that effect, Member States may determine indicators, in accordance with objective criteria based on studies carried out on production and the food supply chain. The parties to the contracts are free to refer to these indicators or any other indicators which they deem relevant.’; (d) in Point III, the following paragraph is added: ‘Delivery contracts shall contain rules applicable in the event of force majeure.’; (e) the following Point IXa is inserted: ‘POINT IXa ‘Member States may require the sugar undertaking to register the written delivery contracts prior to the delivery of the sugar beet.’. Article 2 Amendments to Regulation (EU) 2021/2115 Regulation (EU) 2021/2115 is amended as follows: (1) Article 52 is amended as follows: (a) in paragraph 3, the following point (i) is added: ‘(i) the producer organisation or association of producer organisations implements an operational programme in a Member State in which the degree of organisation of producers in the fruit and vegetables sector has been less than 10 % for three consecutive years preceding the implementation of the operational programme. The degree of organisation shall be calculated as the value of fruit and vegetable production that was obtained in the Member State concerned and marketed by producer organisations or associations of producer organisations recognised under Regulation (EU) No 1308/2013, divided by the total value of the fruit and vegetable production that was obtained in that Member State.’; (b) the following paragraph 5a is inserted: ‘5a. The 50 % limit provided for in paragraph 1 shall be increased to 60 % for expenditure linked to the objectives referred to in Article 46, points (a), (b) or (c), if the following conditions are fulfilled: EN 24 EN  (a) the expenditure is related to investments in tangible and intangible assets as referred to in Article 47(1), point (a), made by young farmers or new farmers, who join a producer organisation recognised under Regulation (EU) No 1308/2013 for the first time; (b) the investments referred to in point (a) are made at the premises of these young farmers or new farmers as part of their first operational programme.’; (c) the following paragraph 7 is added: ‘7. The 50 % limit provided for in paragraph 1 shall be increased to 70 % of the actual expenditure incurred in a given year for operational programmes implemented by producer organisations or associations of producer organisations and affected in this given year by adverse climatic events, natural disasters, plant diseases or pest infestations to be identified by the Member States.’; (2) in Article 68, the following paragraph 2a is inserted: ‘2a. Article 52(3), points (a) to (d) and (f) to (h), and Article 52(5a) of this Regulation shall apply mutatis mutandis.’; (3) in Article 88, paragraph 7 is replaced by the following: ‘7. As of 2025, Member States may review their decisions referred to in paragraph 6 as part of a request for amendment of their CAP Strategic Plans made in accordance with Article 119 and decide to use up to 6 % of their allocations for direct payments set out in Annex V, where relevant after deduction of the allocations for cotton set in Annex VIII, for types of intervention in other sectors referred to in Title III, Chapter III, Section 7. The amount corresponding to the percentage of Member States’ allocations for direct payments referred to in the first subparagraph of this paragraph and used for types of intervention in other sectors for a certain financial year shall be considered to be Member States’ allocations per financial year for types of intervention in other sectors.’. Article 3 Amendment of Regulation (EU) 2021/2116 In Article 16(1), second subparagraph, of Regulation (EU) 2021/2116, point (b) is replaced by the following: ‘(b) exceptional measures under Articles 219, 220, 221 and 222 of Regulation (EU) No 1308/2013.’. EN 25 EN  Article 4 Entry into force and application This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. Article 1, point (1), shall apply from [+2 years]. Article 1, points (2) and (6), shall apply from [+18 months]. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, For the European Parliament For the Council The President The President EN 26 EN Saatja: Janeli Tikk <[email protected]> Saaja: Kristin Truus, Ragne Lokk Teema: RE: UTP ettepanek Eelmise kirja jätkuks saadan veel kord Euroopa Komisjoni ettepanek seoses UTP direktiivi piiriülese jõustamisega (ettepanek lisatud manusena), mille osas ootame tagasisidet 2. jaanuariks 2025.a Vastavasisulise KOM pressiteate leiab siit: https://ec.europa.eu/commission/presscorner/detail/en/ip_24_6321 <https://ec.europa.eu/commission/presscorner/detail/en/ip_24_6321> . Tervitades Janeli Tikk Toidusektori ettevõtluse arendamise valdkonna juht Põllumajanduspoliitika osakond Regionaal- ja Põllumajandusministeerium ______________________________ [email protected] 625 6299 www.agri.ee From: Janeli Tikk Sent: teisipäev, 17. detsember 2024 13:14 To: 'Kristin Truus' <[email protected]> Cc: Ragne Lokk <[email protected]> Subject: UTP ettepanek Tere Järgmine eesistujariik, kelleks on Poola soovib UTP-de kohta tehtud muudatusettepaneku osas vabas vormis ettepanekuid. Palun andke teada, kas teil on ettepanekuid hiljemalt 2. jaanuariks 2025. Seejärel edastame kõik ettepanekud korraga eesistujariigile. Tervitades Janeli Tikk Toidusektori ettevõtluse arendamise valdkonna juht Põllumajanduspoliitika osakond Regionaal- ja Põllumajandusministeerium ______________________________ [email protected] <mailto:[email protected]> 625 6299 www.agri.ee <http://www.agri.ee>