During the farmers’ demonstrations in January, the question of fair remuneration came up like a leitmotif. Breeders denounced, in particular, the non-compliance with the EGalim law, supposed to better distribute value within the agri-food chain based on the farmer’s production costs. This text, promulgated in October 2018, was reinforced twice, giving variations EGalim 2 and 3. The Court of Auditors decided to look into their implementation and made public the conclusions of this “flash audit”, Wednesday February 14.
The Court more specifically chose to analyze the control by the General Directorate of Competition, Consumption and Fraud Control (DGCCRF) of contracts concluded between producers and first buyers in the beef, milk and meat sector. A choice justified in his eyes by the fact “ that this control system appears at this stage as one of the only instruments making it possible to measure the implementation of the EGalim 2 law which made it compulsory to sign a multi-year written contract for the sale of an agricultural product and comes to come into force for all components of the beef sector”.
The report immediately highlights the advantage of buyers in price negotiation, when 28 establishments collect 76% of the milk throughout the country and 143 slaughterhouses provide 92% of the tonnages of beef. In this context of asymmetrical balance of power, the Court of Auditors recommends setting up a reporting platform with a guarantee of confidentiality to facilitate the exercise of farmers’ right to denounce a practice that does not comply with the law.
Simple reminders of the regulations
In total, between 2022 and 2023, the DGCCRF carried out 64 inspections to study contracts, mainly among large buyers. Out of 35 checks carried out in the beef and meat sector, only 7 were in compliance, and in 15 of them, the absence of contractualization was noted. In the dairy sector, out of 29 controls, 9 were compliant. The Court of Auditors points out the fact that no sanctions have been imposed in cases of breaches, the DGCCRF continuing to provide education and simple reminders of the regulations. It considers it desirable that injunctions and sanctions be now applied and requests that an annual report of controls be established and made public.
The report recognizes, however, that the rules applicable to these contracts are complex. The definition of agricultural production cost indicators is often a source of dispute and calls to the mediator. The Court of Auditors proposes to the Committee for the Settlement of Agricultural Commercial Disputes to make public guidelines to remove difficulties in applying the law. It also recommends adjusting the legislative text after analysis, if necessary, to ensure that the initial goal, ensuring a decent income for the farmer, is achieved.