Oireachtas Joint and Select Committees

Tuesday, 5 November 2019

Joint Oireachtas Committee on Agriculture, Food and the Marine

Unfair Trading Practices: Discussion

Ms Christine Tacon:

Yes. I take 60% of the levy. When I first started, it was 10% each. Now I am at 60% of the levy which they share between them. Some 20% of the levy is based on how big they are and how many of the issues I am working on they engage in. The top approximately 20% of the levy can vary, according to how good they have been. If they have been causing me problems, they cop a bigger share of the levy. It is just another incentive of getting them to comply.

The next question was about the competition authorities. The competition commission, now the Competition and Markets Authority, CMA, are behind everything I do. They created the order. The order still sits there so that they have to designate the retailers, or who I have to regulate. In the order, it says that all supply agreements have to be in writing. Annual compliance reports have to be sent to the competition authorities and copied to me - I will come back to that - and now they have to do an annual review to see whether any further retailers should be designated. The competition authorities wrote the code, so my role is just to oversee the code with the retailers that they designate.

There is something in the order that says that I can make recommendations to the Competition and Markets Authority if I think the code is insufficient in some way. Right at the beginning, they said to me that I should really try to resolve anything I found within the code, as it was written, because they feared that they might have to do another market investigation if I wanted to change the code. I have used the code, as I got it, which I have to say is a bit wooly, and if I find anything, I find ways of working with the retailers.

I have spoken to people in many other countries, and the thing that they have always tended to fall over on is trying to bring in some regulation on fair trading practices and address fairness of pricing. If one tries to address pricing at the same time, one tends to really struggle to get there, because one has this big push against it. Are we doing this to protect consumers or under the European Union directive are we doing it to protect farmers? That has been the beauty of the United Kingdom one, that price was very clearly taken out of it, which enabled me to focus on the practices of paying people on time and not over-charging for consumer complaints and all these other things that I have had to look at. That is in many cases focused on areas where retailers can become more efficient and can have a better way of doing business. I know the retailers say they have gotten rid of whole departments that used to work on these things since I raised it. They have decided it is just not worth doing anymore. Arguably, there are great areas of efficiency that can come from that.

I do not meet regularly with the Competition and Markets Authority, but I am based in their building and I do feel that they lend a degree of authority to my role. I feel that there is quite a strong connection between us.

The final question I was asked was about the role of the primary producers and the processors. Ever since I started, there has been campaigning in the United Kingdom for my remit to be extended and for the remit to be taken back to the farmgate and to include processors. After my first three-year term, when they did their statutory review, alongside that, they made a call for evidence on whether the remit should be extended. Following many submissions - clearly very many from the farming community - they decided that there was not a sufficient case for the remit to be extended, but they included at that point that the CMA should review every year whether any other retailers had gone over the £1 billion turnover threshold, which was what they set in 2010 for retailers that were covered by the code, and whether that should be extended.

The origin of the code in the United Kingdom is about protecting consumers and not protecting the primary producers. The role that I have does not tackle the issue between producers and their processors.

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