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EU: Court of Justice rules on exemptions from competition law for producer organizations

 |  November 15, 2017

The European Court of Justice (ECJ) has ruled that concerted practices by agricultural producer organisations can be exempted from competition law, but considered the price-fixing practices carried out by French endive producers as a bridge too far.

France’s Court of Cassation invited the EU’s highest court to weigh in on a challenge by producers of the leafy vegetable endive after the French Competition Authority sanctioned them in 2012 for 14 years of anticompetitive practices.

The 18 challengers include both endive producers and trade groups. They claimed that their practices did not fall within the scope of anticompetitive agreements, decisions and concerted actions that EU law prohibits.

A 16-page ruling out of Luxembourg on Tuesday, November 14, paves the way for their court loss.

“As the Court has already held, the common organizations of the markets in agricultural products are not a competition-free zone,” the ruling states.

“On the contrary, the maintenance of effective competition on the markets for agricultural products is one of the objectives of the common agricultural policy and of the common organization of the markets.”

Common market organizations can qualify for exemption from EU competition rules, but the judges said “that practice must have been implemented by an entity that is actually entitled to do so under the rules governing the common organization of that market, and, therefore, has been recognized by a member state.”

“A practice adopted within an entity not recognized by a member state in pursuance of one of those objectives cannot therefore escape the prohibition of the practices,” the ruling states.

The judge called this “likely to be the case” when it comes to the practices of professional organizations representing endive producers — noting that “there is nothing in the case file … to show that they have been recognized by the French authorities as POs [producer organizations], APOs [associations of POs] or interbranch organizations.

Full Content: Law 360 & Fresh Plaza

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