Romania Needs Law Regulating Retailer-Supplier Relations – Producers

"Retailers still impose store opening taxes, listing taxes. The problem is some producers have to pay because they have no other distribution channels. After the large store octopus spread its tentacles, neighborhood stores disappeared. Besides, we’re not getting our money back," said Ovidiu Gheorghe, head of the National Vineyard and Wine Employers’ Association.

He said Romania needs to adopt a law based on the principles of the Code of Good Practices. Actually, producers required a law during negotiations on the drafting of the code.

"We were suckers. The Agriculture Ministry boosted its image with this Code of Good Practice, as did the commission for economic matters in Parliament, which had drafted a law, but the result is zero. The code was signed and now, ten months later, we have the same policy, the same taxes,” said Dragos Frumosu, head of the National Federation of Unions in Agriculture.

Romanian producers and retailers signed in July 2008 the Code of Good Practice in the trading of food products and the code became effective when the competition authority said it doesn’t breach competition rules.

Under the code, suppliers cannot be forced to contribute to retailers’ costs for marketing or opening of new stores. Moreover, retailers may not terminate their contracts with suppliers if the latter refuse to pay such costs.

Also, retailers may not force suppliers to sell their products at lower prices to other traders, while producers cannot force traders to keep have a certain shelf price.