Romania to require supermarkets to sell 51% local food
According to the text, 51% of fruit, vegetables, meat, eggs, honey, dairy and bakery products would have to be sourced from short supply chains, meaning regional or national suppliers, and would affect retailers with a turnover of more than two million euros.
The law also includes measures on country of origin labelling for fresh and processed meats as well as setting a payment deadline of seven calendar days for fresh food. This means its scope would extend beyond these products specifically mentioned, according to Mihai Visan, executive director of industry group Romalimenta.
Supermarkets that do not comply would be fined while repeat offenders could see their stores closed for up to six months.
The law has been approved by the Chamber of Deputies with 293 votes in favour and none against, and is now waiting to be signed by Romanian president Klaus Iohannis.
Visan told FoodNavigator: “We [at Romalimenta] all agree with the declared goal of the bill: to ease the access of the national producers on the market. But we disagree on [the] means, we communicated that during the negotiations so that our federation was not part of the process and our position is abstention.”
What actually constitutes a local product is not clearly defined. Would it include food made with imported ingredients but manufactured and packaged in Romania? According to Visan the definition is “very general” and “pretty confused”.
The law has the support of the Federation of Food Industry Trade Unions (FSIA). “We want more Romanian products on the shelves, we want Romanian producers to be respected, we want the trade mark-up on our products to be similar to that on imported products," its president Dragos Frumosu is reported as saying in English language Romanian publication Nine o'clock.
"Of course, we don’t want a law that would come to the advantage of the Romanian producer but one that would support the Romanian producer in dealing on an equal footing with any producer from any European Union member state."
'No doubt' in breach of EU law
But, as a member of the European Union, it looks unlikely that Romania has the right to pass such protectionist measures.
Lara Skoblikov, food law expert and partner at Food Compliance International, said there is "no doubt" it is in breach of Article 34 of the Treaty of the Functioning of the European Union. This protects the free movement of goods within the bloc and prohibits national laws that make it easier to sell domestic goods over imported ones.
“I am expecting [the Commission to bring court action against Romania]. It may take a while though. Before the Commission goes to court, they would first ask Romania informally to withdraw the law. You see in practice that the preliminary phase sometimes takes years,” she said.
Meanwhile a spokesperson for the Commission confirmed it was “following the legislative project closely” in order to assess its compatibility with EU law.
There are several examples of the Commission have ruled against attempts by individual members states in the past to protect and promote producers.
Last year the Commission formally asked Slovakia to amend a law requiring supermarkets with a large turnover to publicly inform shoppers at the entrance of each store how many food products are made in Slovakia. “The Commission considers that these requirements have the effect equivalent to quantitative restrictions on free movement of goods, since they lead to consumers' prejudice against products produced outside of Slovakia and encourage retailers to sell domestic products.”
Slovakia has pledged to repeal the law by January 2017.
In 2002, Germany’s Central Marketing Organisation (CMA) was found to be in breach with its quality logo “Markenqualität aus deutschen Landen” (quality label for produce made in Germany) which had been added to around 11,000 finished products.
In the late seventies Ireland launched a campaign to promote Irish products with a ‘guaranteed Irish’ logo that manufacturers could add to packaging. The Court of Justice ruled that even if the campaign did not win over many consumers it was in breach because it was liable to affect trade between member states.
Skoblikov said she found it hard to believe the Romanian authorities are not aware of the legal implications of the law. “You see in practice that often, if member states really want something, they’ll just do it.”