The European Commission for the first time imposed fines on farmers unions yesterday. Six French federations in the beef sector received a total of €16.7 million in fines for taking part in an agreement to set a minimum price for beef and to suspend, or at the very least, limit imports of all types of beef into France. Bullying tactics by some of the unions were particularly heavily criticised by the Commission.
On 24 October 2001 the six federations, four representing farmers and the two others slaughterers, entered into the agreement that continued beyond the end of November 2001, the date on which it was supposed to end, despite the fact that the Commission had warned the federations that the agreement was unlawful.
"The competition rules also apply to agriculture, as this decision makes clear," said Mario Monti, the Commission Member with special responsibility for competition.
But the Commissioner added that he had taken into account the then difficult context facing the beef sector, which had been shaken by successive crises. Adding, "as far as the slaughterers are concerned, it has also taken account of the fact that they were acting under pressure and the threat of violence from farmers."
In a statement yesterday the Commission reaffirmed that agreements on prices and restrictions of imports are among the most serious infringements of competition law.
"There is no doubt that the organisations knew that their conduct was unlawful. During the inspections carried out by the Commission in December 2001, documents were found which noted that the agreement was 'a bit against the law, but that can't be helped' and asked 'can we close ranks, without being caught by the DGCCRF [the French competition authority]?'" reports the Commission.
The Fédération Nationale des Syndicats d'Exploitants Agricoles (FNSEA) received a €12 million fine, Jeunes Agriculteurs (JA) €600,000, Fédération Nationale Bovine (FNB) €1,440.000, Fédération Nationale des Producteurs de Lait €1,440,000, Fédération Nationale de l'Industrie et des Commerces en Gros des Viandes €720,000 and the Fédération Nationale de la Coopération Bétail et Viande (FNCBV) €480,000. The groups have up to three months to pay their fines.
The Commission came down particularly harshly on FNSEA, FNB and JA for their role in intimidating the slaughterers and "involved in acts of violence intended to force them to conclude the agreement and monitor and enforce its implementation".
However, as the Commission pointed out, the fines could have been a lot worse with the basic fine for breaches of competition rules normally reaching €20 million. As a nod to "the specific economic context which, since 1996, has shaken the farming community," the Commission chose to reduce the fine.