€14bn per year: this is the estimated cost of territorial supply constraints (TSCs) in retail trade for European consumers, according to a European Commission study released in July 2020.
The Benelux Union announced on Tuesday that it is asking Brussels to consider legislative measures to mitigate the negative consequences of these barriers.
For retailers, the restrictions prevent them from choosing a supplier based in the country of their choice. For customers, they often mean lower prices for certain products in one country over another.
This is why the Benelux Union called on internal market commissioner Thierry Breton, competition commissioner Margrethe Vestager and consumer rights commissioner Didier Reynders this summer.
A level playing field must be created.
“For the Benelux, the coherence of the objectives of an integrated European internal market is essential,” said Alain de Muyser, secretary general of the Benelux Union, in a press release. “A level playing field must be created. We, the Benelux, want to make a substantial and constructive contribution to the European debate. This certainly applies to the issue of territorial supply constraints in the retail sector, which the Benelux countries are facing.”
A longstanding issue for Benelux countries
This subject has been of concern to the cross-border union since 2015, when its three respective economy ministers signed a recommendation to strengthen cooperation on territorial supply constraints. Three years later, the Benelux published a survey on the phenomenon, which concluded that such supply constraints were present in all three territories, with the particularity that in Luxembourg they extended beyond retail.
In 2019, the Benelux Union requested the European Commission to take TSCs into account in the assessment of the EU block exemption regulation.
For the trio, these TSCs hinder the functioning of the European internal market and cross-border competition, of which Brussels is the appointed guardian. “The European response, which is badly needed, should reduce the possibility of ‘geo-blocking’ between companies, ensure fair trade and competition, and facilitate parallel imports,” said the Benelux Union’s general secretary.
This article in Paperjam. It has been translated and edited for Delano.