Final adoption in sight for the law strengthening manufacturers against supermarkets

The bill is expected to pass on Wednesday. ERIC GAILLARD / REUTERS

The measures tackle the “structural imbalance” between suppliers and big buyers like Leclerc, Carrefour or Intermarché, whose price war is pulling margins down.

The bill strengthening manufacturers in their tense negotiations with large retailers should be definitively adopted on Wednesday by Parliament, to the chagrin of brands which ensure that consumers will pay the price. After a compromise between deputies and senators, largely validated Tuesday in the Senate, it is the turn of the Assembly to decide in the afternoon on the text carried by the Renaissance deputy Frédéric Descrozaille and fought tirelessly by the media Michel -Edouard Leclerc.

These measures address thestructural imbalancebetween the suppliers on the one hand, and the big buyers like Leclerc, Carrefour or Intermarché on the other, whose price war is dragging down margins. The text aims in particular to dissipate the “legal vaguenessexisting in the event of failure of the annual commercial negotiation, scheduled from December to March for the products which fill the shelves.

Currently, if suppliers and distributors do not agree, their contract is not interrupted. A favorable situation for supermarkets, which can continue for several months to order products at the old price, even though the supplier may be faced with an increase in its production costs. The text provides in the event of failure of the negotiation, on an experimental basis, that the supplier has the choice: to interrupt the deliveries of the stores or to apply a notice of rupture “classicby taking into account market conditions, such as inflation.

“Penalized consumer”?

The agreement sealed in the Joint Joint Committee (CMP) also extends until 2025 the experiment in the supervision of the “resale at a loss thresholdfor food products. Fresh fruits and vegetables, initially concerned, were excluded as the text was examined. Consumer associations demanded the suspension for all food products of this criticized measure, which expired in April. It obliges supermarkets to sell food products at least 10% more expensive than the price at which they bought them.

Another point of tension: the 34% cap on promotions “shocks” on non-food products, judged “irresponsible and inflationaryby the employers’ federation of large retailers, the FCD. “The consumer will once again be penalized: these products (detergent, scouring powder, deodorant, dishwasher tablets, shampoo, combs, and other curlers) are among the most expensive in customers’ shopping carts“Thundered Tuesday on his blog the president of the strategic committee of the Leclerc centers, Michel-Edouard Leclerc. But MP Descrozaille is annoyed with AFP: “He must stop making everyone believe that he is elected by consumers.“. Because “people don’t know that when they come out of a Leclerc store with a 5 euro discount, it’s not Leclerc’s generosity: it’s been paid for by suppliers“.

The Minister of the Economy Bruno Le Maire said he was in favor of distributors being able to “make promotions not just at 34% on shampoos, hygiene products, detergent products but up to 50%“. Deputies and senators, however, maintained the ceiling they had agreed to, but an amendment adopted Tuesday in the Senate, and which will also be presented on Wednesday in the Assembly, concedes an entry into force postponed to March 1, 2024.

Another provision decried by the major brands plans to subject negotiations with European purchasing centers to French regulations, when the products concerned are intended for the French market. A response to the creation by certain distributors of power stations abroad aimed at negotiating, according to MP Descrozaille, with “legal provisions (…) less protective of the interests of French farmers and made in France“. To protect farmers, the text submitted to the vote on Wednesday also provides for a “non-negotiability of agricultural raw materialsin products sold under private label.

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