Several EU states are to propose an end to so-called territorial supply constraints (TSCs) today (24 May) at a meeting in Brussels.
The Netherlands, Belgium, Greece, Czechia, Slovakia, Denmark, Croatia and Luxembourg, have put forward the idea for discussion.
Go deeper with GlobalData
They are looking to end constraints they believe prevent online retailers from buying products from a member state of their choice in favourable market conditions.
It comes as the European Commission issued a €338m ($366.5m) fine to Mondelez International this week for violating competition laws by “hindering cross-border trade”.
Brussels had been investigating the Cadbury owner since 2021 regarding the infringement of anti-trust laws in its trade of chocolate, coffee and biscuits between EU member countries.
The proposal to be discussed today was developed following the publication of research from the Dutch Ministry of Economic Affairs and Climate last year. The ministry said it found retailers faced TSCs for 2-4% of the products bought. Goods facing TSCs would on average be 10% more expensive than other products.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataA 2020 study from the Commission also found retailers could save around €14bn ($15bn) a year if they were allowed to source products without constraints.
As part of their proposal, the eight member states have called for an adjustment or expansion to EU law, “to prohibit unfair practices in B2B relations which discriminate a retailer on the basis of its place of establishment”.
They have also called for the EU to assess the use of digital labels n products to allow products to adhere to regulations that require labels to be available in each European national language.
Commenting on the proposal, the Dutch Economic Affairs and Climate Policy Minister, Micky Adriaansens said: “Removing trade barriers should be a key priority for the Single Market. This helps in keeping consumer retail prices for food and non-food products fair, something which is especially important in times of high consumer prices.”
He added: “The eight member states proposing a concrete way forward towards an EU ban on TSCs by amending existing or new common EU rules or instruments.
“Discussions with other fellow ministers show that even more EU member states recognise the issue, so I am confident that the upcoming, new European Commission will be able to follow up swiftly to solve this urgent internal market issue.”
