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European Commission fails to act on Unfair Trading Practices in banana supply chains

European Commission fails to act on Unfair Trading Practices in banana supply chains

A recently published report by the European Commission (EC) on Unfair Trading Practices (UTPs) in the food supply chain, has failed to propose legislation to tackle problems in the banana supply chain which have been highlighted by the Europe-wide Make Fruit Fair! campaign, in which Banana Link plays a central role. Instead, the EC has passed responsibility to a voluntary initiative set up by the private sector and to EU Member States.
Banana Link and the Fair Trade Advocacy Office had published a report last October – Banana value chains in Europe and the consequences of Unfair Trading Practices – setting out the need for legislation. The report detailed how banana workers and small farmers in developing countries are exposed to toxic agro-chemicals, earn poverty level wages and work in a climate of fear, and how European supermarkets contribute to this situation by engaging in Unfair Trading Practices. Along with the report, the Make Fruit Fair! campaign had gathered over 50,000 signatures on a petition to European Commissioner for the Internal Market, Elżbieta Bieńkowska, calling for legislation.
Instead of legislation, the EC has put its faith in a voluntary scheme – the Supply Chain Initiative –  which Make Fruit Fair! campaigners believe to inadequate for tackling UTPs. Fiona Gooch, Traidcraft Senior Policy Adviser echoed these views, saying:
Just earlier this week, UK supermarket watchdog the Groceries Code Adjudicator found Tesco guilty of consistently under-paying suppliers or paying late in order to artificially inflate their profits. Tesco operates across Europe and their early membership of the voluntary Supply Chain Initiative did not deter these outrageous practices. Market information suggests that it is likely that other retailers have acted in a similar way to remain competitive. Inaction by the European Commission leaves suppliers exposed to unfair trading practices (UTPs) that include late payments, unilateral changes to contracts and the unfair shifting of risk onto suppliers. Research shows that when supermarkets dump risk onto their suppliers in the form of delayed payments or additional costs, these risks are often passed on down the supply chain. This can ultimately lead to the exploitation of workers and producers in developing countries.
Photo: © Make Fruit Fair/K. Vadino