By Youssef Oubejja
The foodstuffs sector is one of the State’s strategic priorities. The issue of food security, and the marketing of quantities of agricultural products at reasonable prices, pose various complex structural and economic problems.
The combination of these problems currently clearly constitutes the main cause of the observed rise in commodity prices on the national and international market. These include strong global demand, which is putting supply under pressure, and unable to meet demand, particularly in the context of the war in Ukraine, which has serious consequences on the markets and aggravates food insecurity. The consequences of this war were grafted onto the devastating effects of the health crisis which had already unbalanced the supply chains at the global level.
Added to this are the vagaries of the weather which have occurred in various producing countries, reducing harvests and having repercussions on the prices of agricultural products.
Faced with this increase, it is undeniable that the expectations of consumers who see their purchasing power diminished are high. Moreover, in response to these expectations, we have seen a major investment by the public authorities in our country to further regulate the market in favor of consumers, despite the delay in anticipating the continuous price increases for which they are often blamed. Control campaigns were carried out on various markets and various government measures aimed at lowering prices were taken by the public authorities, such as those relating to the import of 200,000 cattle to deal with the rise in meat prices.
We consider that these are emergency measures to deal with a difficult situation which does not respond to the thorny structural questions posed by trade in general and that of foodstuffs in particular. Only the combination of effective deterrence and the strengthening of the role of the State in the regulation of food markets coupled with the return to targeted protectionism, allows us to respond to these structural questions. Abuse remains at the heart of these structural issues affecting the market as a whole.
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In fact, abuse is very common in relations between professionals and between the latter and the consumers who constitute the weak links in the market. Law 104/12 on freedom of prices and competition provides a whole title relating to restrictive practices of competition which allows professionals to protect themselves against the abuses of which they may be victims. These are tying, refusal to sell, fixed price and discriminatory practices.
However, in practice, this range of legal provisions remains a dead letter and is the subject of very few case law. Several reasons explain this rarity. On the one hand, professionals do not take legal action when they suffer material damage and, it seems, prefer opportunely and cowardly to pass on the losses linked to this damage to the vulnerable end consumers. On the other hand, justice is not trained and initiated to competitive litigation.
Regarding another aspect relating to the structural problems posed by the food markets, we consider that the latter are conducive to anti-competitive risk through the abuse of dominant positions and sneaky agreements. The observation of this major risk imposes the need to regulate the distribution circuits and the contractual relations which are fanned between the various stakeholders at the level of the chain (wholesaler retailers, producer suppliers, supplier distributors), in order to better identify abuses and fight against the anarchy that characterizes these networks in our country.
Given these findings, we allow ourselves to ask the question of whether the mission of regulating competition within these markets is fully ensured by the Competition Council and the courts. Is the mission of these regulatory actors not hampered by the lobbying of operators? Likewise, is deterrence, which constitutes the fundamental purpose of the law, fulfilled effectively enough?
The scarcity of case law produced in the field of competition litigation does not allow us to answer these questions in the affirmative. It is essential to ensure beforehand that market players are made aware of the means and protective provisions that the law provides for them. This awareness of the contributions of special texts derogating from common law must also be intended for judges and lawyers
We admit that this examination of the causes of the rise in prices in this inflationary context absolutely requires an appeal for civility and the moralization of commercial relations for the benefit of consumers. We also call for the repetitive maintenance of control campaigns to fight against the crime of clandestine storage, hoarding and illicit speculation.
Furthermore, in this difficult context, there is a strong need to combine the efforts of all stakeholders. We recommend that there is an essential need for complementarity between an effective deterrence policy and the strengthening of the regulatory State, which is certainly liberal, but which does not skimp when there is an emergency to have recourse to targeted protectionism.
Youssef Oubejja: Doctor in Economic Law.