The practices of the stakeholders in the agricultural and food supply chain must be subject to continuous monitoring in order to prevent unfair trading practices or to prohibit the use of certain contractual terms which are considered unfair and therefore prohibited, even if both parties agree to them.
Pursuant to the Agriculture Act, which transposes Directive (EU) 2019/633/EU of the European Parliament and of the Council of 17 April 2019 on unfair trading practices in business-to-business relationships in the agricultural and food supply chain, the Agency is the designated enforcement authority.
Article 61f(1) of the Agriculture Act defines prohibited trading practices as those practices by which a buyer with significant market power, as evidenced by its annual turnover in accordance with Article 12(3) of the Agriculture Act (the annual turnover of the supplier and the buyer in relation to Directive 2019/633/EU shall mean the annual turnover in accordance with the Annex I to Commission Recommendation 2003/361/EC of 6 May 2003 concerning the definition of micro, small and medium-sized enterprises (OJ L 124, 20.5.2003, p. 36), in particular the definitions of sole proprietorship, partnership enterprise and associated enterprise), in particular in relation to the supplier, takes advantage of the supplier contrary to good commercial practices.
According to Article 61f(2) of the Agriculture Act, the buyer is considered to have significant market power if the annual turnover generated in the previous year:
1. by the supplier does not exceed 2,000,000 euros, but exceeds 2,000,000 euros from the buyer;
2. by the supplier exceeds 2,000,000 euros, but does not exceed 10,000,000 euros, and by the buyer exceeds 10,000,000 euros;
3. by the supplier exceeds 10,000,000 euros, but does not exceed 50,000,000 euros, and by the buyer exceeds 50,000,000 euros;
4. by the supplier exceeds 50,000,000 euros, but does not exceed 150,000,000 euros, and by the buyer exceeds 150,000,000 euros;
5. of the supplier exceeds EUR 150,000,000, but does not exceed EUR 350,000,000, and by the buyer exceeds EUR 350,000,000.
Prohibited practices are (Article 61f(4) of the Agriculture Act):
1. reimbursement for services which have not been rendered or for services which have been rendered but which have not been agreed in writing and clearly in advance between the parties;
2. reimbursement for the introduction, maintenance or extension of a product range or products;
3. reimbursement for the storage or display or shelving of products at points of sale, or for making such products available on the market, or for the cost of personnel to furnish premises used for the sale of the supplier's products, unless clearly and unambiguously agreed in advance by the supplier and the buyer in the supply contract or in subsequent written agreements between the supplier and the buyer, which will be implemented and the implementation of which can be demonstrated;
4. the charging of rebates for the promotion, advertising and marketing of agricultural and food products, unless the supplier and the buyer have agreed in writing, clearly, unambiguously and in advance in the supply contract or in subsequent written agreements between the supplier and the buyer, which will be implemented and which can be demonstrated to have been implemented;
5. reimbursement of the costs of concluding the contract;
6. a contribution to the expansion of the store's sales network, the improvement or conversion of existing outlets, the expansion of storage capacity, the extension of the distribution network and similar activities;
7. the return of unsold perishable agricultural and food products and products which have a shelf life of at least one third of the period from delivery to maturity, without payment by the buyer for these unsold products or for the disposal of these products, or both, unless the return of non-perishable agricultural and food products has been clearly and unambiguously agreed in advance in the supply contract or in subsequent written agreements between the supplier and the buyer, the implementation of which can be demonstrated;
8. payment for goods not sold during the period of the promotion at the promotional purchase prices;
9. regular or disproportionate discount for payment of invoices before their due date;
10. charging compensation for a reduction in turnover, sales or margin due to a reduction in the sale of certain goods;
11. failure to comply with the payment deadlines;
12. failure to take over the agreed quantities of products in accordance with the agreed buying-in dynamics, if these deviate from the agreement by more than 25 percent;
13. making the conclusion of a contract or business cooperation conditional upon counter-supply on non-competitive terms;
14. demanding exclusivity of sale of particular goods, except for goods manufactured for sale under a trade mark or at the customer's request and to the customer's specifications;
15. making the conclusion or renewal of a contract or the acceptance of products conditional upon the requirement to manufacture and supply trade-marked products which are deemed to be interchangeable with the manufacturer's trade marks;
16. a requirement by the buyer that the supplier does not sell the products to third parties at prices lower than those paid by the buyer;
17. cancellation of an order for perishable agricultural and food products within a period so short that the supplier cannot reasonably be expected to find an alternative means of marketing or using the products; cancellation within a period of less than 30 days shall always be regarded as a short period;
18. discriminatory or disproportionate charging of compensation for unloading of the goods supplied;
19. a demand for payment for deterioration or loss of agricultural or food products, or both, occurring on the buyer's premises or after the transfer of ownership to the buyer, where such deterioration or loss is not due to the negligence or fault of the supplier;
20. the transfer of commercial risk to the customer after delivery in respect of fines or other penalties imposed, unless the fine or other penalty imposed is due to a defect in the goods for which the supplier is responsible;
21. the imposition of disproportionate or unfair contractual penalties;
22. prohibiting the assignment of claims;
23. refusal to confirm in writing the terms of the contract of supply between the buyer and the supplier, or failure to comply with the obligations laid down in Article 61g of the Agriculture Act as regards the written form or the mandatory elements of the contract;
24. unilateral changes of the terms of the contract for the supply of agricultural and food products concerning the frequency, manner, place, time limits or extent of supply or delivery of agricultural and food products, quality standards, payment terms or prices, or concerning the provision of services;
25. the unlawful acquisition, use or disclosure by the Buyer of the Supplier's trade secrets in accordance with the law governing trade secrets;
26. threats of retaliatory measures by the Buyer (e.g. withdrawal of products from the offer, reduction of ordered quantities of products or suspension of certain services provided by the Buyer to the Supplier, such as marketing or promotions of the Supplier's products) or the taking of such measures if the Supplier is exercising its contractual or legal rights, including by filing a complaint with the authorities referred to in Article 61i of the Agriculture Act or by cooperating with those authorities during the proceedings;
27. a claim by the Buyer for compensation for costs incurred in investigating a customer complaint in connection with the sale of the Supplier's products, even if the Supplier is not negligent or at fault.
The prohibitions referred in the Article 61f(4) of the Agriculture Act are mandatory overriding provisions applicable to any case falling within the scope of this prohibitions, irrespective of the law that would otherwise apply to the supply contract between the parties.
If the contract contains prohibited trading practices, such provisions of the contract shall be void.
For administrative offences, the Agency can impose a fine on the buyer up to 0.25% of the buyer's annual turnover generated in the preceding business year, if the buyer intentionally or negligently acts in breach of Article 61f or 61g of the Agriculture Act or acts contrary to an obligation laid down in an enforceable decision issued by the Agency for breaching Article 61f or 61g of the Agriculture Act.
Pursuant to Article 61i of the Agriculture Act, suppliers may address complaints of prohibited trading practices in the Republic of Slovenia to the Slovenian Competition Protection Agency at the following address:
Javna agencija Republike Slovenije za varstvo konkurence
Dunajska cesta 58
1000 Ljubljana
or
by e-mail to: gp.avk(at)gov.si.
Suppliers may also address complaints to the enforcement authority in the Member State in which the supplier is established or to the enforcement authority in the Member State in which the buyer suspected of having engaged in the prohibited trading practices is established.
Producer organisations, other supplier organisations and associations of such organisations may address complaints as referred to in the preceding paragraph at the request of one or more of their members or, at the request of one or more of the members of their member organisations, where those members consider that they are affected by the unfair trading practices. Other organisations representing suppliers may, at the request of the supplier and in the supplier's interest, address complaints, provided that such organisations are independent, non-profit-making legal persons.
The Agency shall take the necessary measures to adequately protect the identity of the complainant, members or suppliers and to adequately protect any other information in respect of which the complainant considers that disclosure of such information would be prejudicial to the interests of the complainant, members or suppliers. The complainant shall identify any information in respect of which confidentiality is claimed.