Agri-food – antitrust and aid in light of covid-19 Webversion
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Agri-food – antitrust and aid in light of covid-19 
The covid-19 crisis has serious implications for farmers and food producers. It has not only brought major disruption in supply chains and a shortage of seasonal workers, but has also affected food demand in various ways. The exceptional state of affairs has prompted the European Commission (“EC”), as well as various national authorities, to take unprecedented measures.
Agri-food and antitrust

Crisis cooperation and antitrust – to tackle the crisis, agri-food companies may have to cooperate in ways that would normally be anti-competitive and illegal. On 5 May 2020, a temporary and limited EU exemption from competition rules for the milk, flower and potato sectors entered into force to facilitate collective measures to stabilise the market. The exemption allows the milk sector to coordinate milk production planning, and the flower and potato sectors to withdraw products from the market (for details, see here). The exemption is based on Article 222 of Regulation 1308/2013 establishing a common organisation of the markets in agricultural products.  We may see similar measures allowing greater flexibility for industry initiatives in other agriculture sectors as the crisis continues.

The EC has also published a Temporary Framework to guide companies on how to cooperate to secure supplies of essential scarce products during the crisis. Even though the framework is aimed ostensibly at healthcare, the principles and approach it outlines can be transferred, at least by analogy, to guide the agricultural sector when experiencing similar challenges. Cooperation that would otherwise be a breach of competition law may be allowed provided it is: (i) designed and objectively necessary for its objective; (ii) temporary; and (iii) not exceeding what is strictly necessary to achieve the objective. Such cooperation could include coordinating transport and delivery, and information exchange on stock levels.

Both the EC and many national competition authorities have expressed unusual willingness to offer guidance and, where necessary “comfort letters”, to provide more legal certainty when navigating competition law and cooperation in this time of crisis. The EC has already issued one comfort letter in the pharma industry, and is considering several requests within the agri-food sector.

Practical tips before taking action:
  • Carry out an antitrust risk assessment to ensure the criteria of the Temporary Framework/other relevant exemptions are fulfilled.

  • Consider seeking informal guidance from the European Commission ( or relevant national competition authorities.

  • Build the language of the Temporary Framework/other exemptions into all legal and corporate documents concerning the cooperation (for example, on safeguards / limits).
Abuse of dominant position – we have seen sharp price increases on certain products related to the crisis. For companies that are in a dominant position, it is important to be aware that competition authorities are on the look out for and ready to take action against illegal profiteering. The Swedish competition authority has issued a press release to this effect and the UK, for example, is considering emergency legislation to ramp up enforcement efficiency on this front. Companies that do not have a dominant position should also be mindful of the fact that dominance can arise more unexpectedly in these rapidly changing markets.

State aid and other support schemes for agri-food and beyond

State aid rules – the EC has adopted a Temporary Framework for state aid in response to the crisis. The framework enables Member States to give up to EUR 800 000 in aid to companies involved in food processing and sales, up to EUR 120 000 to companies active in the fishery and aquaculture sector, and up to EUR 100 000 to farmers. Aid to farmers can be topped up by de minimis aid (i.e. national support specific to agriculture granted without prior approval from the EC), adding up to a total maximum aid level of EUR 125 000 per farm. The EC has already approved state aid schemes under the Temporary Framework to support the agriculture, fishery, aquaculture and food sectors in Finland, Italy, Croatia, Belgium and Latvia (see more here).

EU support – the European Investment Bank and the EC have promised funding specifically directed at the agri-food sector (for example, via the EAFRD). The EC has also introduced flexibility to the CAP instruments, including increasing cash flow to farmers (see more here). Measures on private storage aid for dairy and meat have also been adopted, as well as measures providing flexibility for market support programmes for a number of products (see more here). The Council has adopted amendments to the European maritime and fisheries fund to enable increased support to the fishery and aquaculture sector.

General support measures in Sweden – the Swedish Government has adopted a number of support measures to address the negative economic impact of the COVID-19 crisis. More measures can be expected in the coming weeks. We are not aware of any Swedish support aimed directly at the agri-food sector as yet.
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Practical tips to benefit from support measures
  • Identify vulnerable parts of the business.

  • Consider which general and specific support measures may be available to address these vulnerabilities and identify how and when to apply for them.

  • Mannheimer Swartling is available to provide further guidance at, or by reaching out to your usual firm contact.

Other developments
  • ‘Green lane’ border crossings – to ensure a continuous flow of goods, the EC has asked Member States to designate internal border-crossing points to be open to all freight vehicles.  Border crossing is to take maximum 15 minutes, including health screenings (details here).

  • Seasonal workers to qualify as “critical workers” – the EC has published guidelines to ensure that farm workers and similar can reach their places of work (Swedish rules here).

  • Fewer farm on-the-spot checks – physical checks to ensure that CAP eligibility conditions are met will be reduced.

  • Food safety – the EC has also adopted a temporary Regulation (EU) 2020/466 relaxing rules on official food safety controls.

  • Swedish Agency for Marine and Water Management – the agency has announced a temporary relaxation of physical checks of fishing boats and of traceability requirements (details here).

  • Unfair trading practices – implementation of the Directive on unfair trading practices in the food chain scheduled for autumn 2020 may become relevant during the crisis (details here and here).

  • Critical service – food supply systems are classed as “critical services” which means that the Swedish Government will ensure their continued operation. So far, the only related measure is a regulation ensuring access to daycare for children of employees within food supply.

Prepared by Victor Sand Holmberg, Senior Associate, Ina Söderlund, Associate and Freija Haas, Trainee, all in our Brussels office.

Johan Carle,
Stefan Perván Lindeborg,
Fredrik Sjövall,
Sarah Hoskins,
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