EU Adopts Guidelines for Sustainable Agriculture Agreements

The European Commission has taken a significant step towards promoting sustainability in the agriculture sector by adopting new Guidelines on designing sustainability agreements. These guidelines leverage a recent exclusion from EU competition rules, as introduced by the reformed Common Agricultural Policy (CAP).

The Guidelines, unveiled today, are crafted to align with the newly incorporated Article 210a of Regulation 1308/2013 establishing a common organisation of the markets in agricultural products (CMO Regulation). While Article 101 of the Treaty on the Functioning of the European Union (TFEU) generally prohibits agreements restricting competition, the exclusion in Article 210a offers a crucial exemption for certain restrictive agreements in the agricultural sector. This exemption is applicable when such agreements are deemed indispensable to achieving sustainability standards surpassing mandatory EU or national regulations.

The ambitious move comes in the wake of the Common Agricultural Policy reform for the period 2023-2027, which saw the European Parliament and the Council of the European Union collectively adopting a new exclusion from competition rules specifically tailored for agricultural products in 2021.

Upon publication in the Official Journal of the European Union, the Guidelines are set to enter into force, presenting a framework for operators engaged in sustainability agreements within the agriculture sector. Companies currently having sustainability agreements in place are encouraged to align their practices with the Commission’s Guidelines. Furthermore, operators are granted the opportunity to seek an opinion from the Commission regarding the compatibility of their agreements with EU competition rules, effective as of December 8, 2023.

The overarching goal of these guidelines is to strike a balance between fostering sustainability in agriculture and ensuring fair competition within the sector. By providing a structured framework for sustainability agreements, the European Commission has said it aims to encourage practices that go beyond mandatory regulations, contributing to a more environmentally conscious and competitive agricultural sector.

Source: EC Europa