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Industry bodies demand stronger EU action on unfair trading practices

Trade representatives FoodDrinkEurope and EFFAT have united to call for tougher rules on unfair trading practices across the EU’s food supply chain.

In October, one of Europe’s largest trade unions, the European Federation of Food, Agriculture and Tourism (EFFAT) and FoodDrinkEurope, which represents Europe’s food and drink manufacturing industry, published a joint position on unfair trading practices (UTP) in the agri-food chain.

At a glance:

• FoodDrinkEurope and EFFAT are urging the EU to revise its Unfair Trading Practices (UTP) Directive.
• The bodies want EU policymakers to remove turnover thresholds, expand the blacklist of abuses, and improve enforcement.
• Widespread unfair practices persist, but few suppliers file complaints due to fear of retailer reprisals.

They are calling for a tougher UTP Directive than the current law, which was introduced in 2019. The organisations want the updated Directive to better protect all suppliers, expand the blacklist of abuses and stamp down on retailer reprisals against complainants.

The European Commission’s latest evaluation of the Directive indicates the number of investigations and enforcement actions by national authorities has been steadily rising, with over 4,500 investigations opened between 2021 and 2024.

The joint position comes ahead of the European Commission’s confirmed revision to the UTP Directive, which it first announced with its Vision for Agriculture and Food in 2025.

Calls for stronger legal reform

Alongside rising input costs and growing retail demand, UTPs remain prevalent and risk further squeezing manufacturers’ margins.

“When large retailers and their buying alliances squeeze suppliers through UTPs, the pressure does not stop at company margins,” Enrico Somaglia, general secretary of EFFAT, said. “It ends up on the factory floor or inside a farm.”

“The Commission should prioritise removing the turnover threshold, expanding the blacklist of prohibited practices, and bolstering proactive and co-ordinated enforcement efforts, specifically to address the ‘fear factor’,” Rafael Sampson, senior manager at FoodDrinkEurope, told Ingredients Network.

Widespread structural issues

In the European Commission’s 2026 public consultation, 65% of respondents reported having observed illegal behaviour in their supply chains. However, only 6% filed a formal complaint, suggesting a barrier to engaging with the current UTP Directive.

“Clearly, then, a revision is needed to stamp this out,” Sampson said.

The joint position said that in most EU countries, the four largest retailers control over 50% of the market, rising to as much as 90% in some countries. Furthermore, it stated that European Retail Alliances (ERAs) worsen UTPs by increasing their bargaining power throughout the supply chain and controlling consumer access. In 2024, ERAs' share of EU grocery sales almost doubled to 59%, up from 31% in 2015.

Suppliers fear retaliation, too, which deters them from reporting UTPs. “Currently, smaller operators are afraid to complain against gargantuan buyer groups and, as such, complaints are low, despite ongoing illegal practices,” Sampson said.

Creating a fairer food system

FoodDrinkEurope and EFFAT want the EU to remove the current EU-level turnover threshold so that all suppliers receive protection, regardless of size. Currently, only companies with a maximum of €350 million in annual turnover are protected.

“The threshold’s removal will be the most important change in closing existing gaps,” Sampson said.

It will help manufacturers to avoid facing late order cancellations, demands for payments unrelated to sales, and pressure from increasingly concentrated retail buying alliances.

“Unfair is unfair, regardless of a supplier’s size,” Dirk Jacobs, director of FoodDrinkEurope, said.

New UTPs are also emerging despite the existing Directive. As a result, the joint position calls for the revised law to explicitly prohibit further UTPs by adding them to a list of prohibited practices.

When retailers abruptly cut orders, for example, manufacturers are often forced to reduce purchases from ingredient suppliers and farmers. “A last-minute order cancellation can quickly ripple through the entire supply chain, increasing costs and uncertainty, from farm to fork,” Sampson said.

UTP

The risk is that these pressures undermine investment in ingredient innovation, production capacity and sustainability – and it is a reality the industry is already seeing.

One company FoodDrinkEurope spoke with said: “Following intensified retail negotiations in 2025–2026, multiple EU regenerative agriculture and sustainability pilots were delayed, scaled back or cancelled, affecting hundreds of farmers and tens of thousands of hectares earmarked for transition programmes.”

FoodDrinkEurope and EFFAT hope the updated Directive will provide more consistent and effective enforcement to address suppliers' fears around reporting.

“Many suppliers fear commercial retaliation, including delisting, reduced shelf space or lost business,” Sampson said. “Better protection against reprisals is essential because Europe's food and drink makers, farmers and SMEs should not have to choose between speaking out and protecting their business from bullying tactics by powerful retailers,” he added.

The trade associations also hope to see harmonised EU standards for inspection frequency and staffing levels; a consistent framework for sanctions and appropriate deterrents for violations; a framework that empowers enforcement authorities to conduct proactive controls; and improved cross-border cooperation under Regulation 2026/697.

A spokesperson for the European Commission said it could not comment on the upcoming proposal at this stage.

FoodDrinkEurope and EFFAT are waiting for the results of the European Commission’s proposal, which they expect will be released in December or early January 2027.

“Businesses invest when they have confidence in stable and fair trading conditions, but we do not have this under the current UTP Directive,” Sampson said.