51% Local Products- New Romanian Law on Food Sale, Inbetween Encouraging National Production and the EU Legal

Order?
The Romanian Parliament has recently passed long debated amendments
to the Law 321/2009 on the sale of food products (the Law). The Law
represents a bold step towards the promotion and encouragement of local
producers and local agricultural economy, currently facing difficulties in
finding a marketplace for their products.
The enactment of such amendments has been justified by its initiators on
the desire to offer consumers more fresh products, directly from the
source. Access to supermarkets has been thus facilitated and innovation of
local producers stimulated by allowing their products to compete directly
with imported products. By limiting the number of intermediaries from the
supply chain channel and regulating certain financial aspects, subject to
certain conditions, the normative act purportedly intends to make room for
lower prices and healthier food for the final consumer.
The most important amendments of the Law concern the following
aspects:

large retailers (i.e. those having an annual net turnover or owning

assets representing more than EUR 2,000,000) shall be under the
obligation to purchase 51% of the products belonging to the
category of meat, eggs, vegetables, fruits, honey, dairy and bakery
products, from the short supply chain;
retailers shall have the obligation to ensure distinct exhibition and
selling spaces for the Romanian products;
introduction of an interdiction for retailers to request and collect any
additional fees and services from suppliers;
establishment on a mandatory basis of a maximum payment due
date of 7 (seven) calendar days for retailers for the fresh food
products purchased from suppliers;
introduction of an obligation for retailers to organize events for the
promotion of Romanian food products, according to a schedule to be
established by the local authorities;
introduction of detailed rules regarding the labeling of the meat sold
on the Romanian market, as well as the obligation to include the
percentage of meat originating from Romania, on all meat products
sold on the EU internal market;
retailers shall no longer be allowed to perform the qualitative and
quantitative checks for the purchased fresh products during a
certain time after delivery, but at the moment of delivery.

The applicable fines for non-compliance with the Law could amount up to
RON 150,000 (approximately EUR 30,000). In case of repeated offences,

public authorities shall have the possibility to stay the activity of the
retailer for a period of 6 months by stay of its authorization to operate.
At a first glance, in the light of the European Court of Justice case law and
of the interpretation of the rule regarding prohibition of quantitative
restrictions on imports (i.e. art. 34 of the Treaty on the Functioning of the
European Union), even measures such as encouraging and promoting the
purchasing of national products (ECJ Case 249/1981 Commission v. Ireland
(Buy Irish) 24.11.1982) or the obligation to display statistics with the
percentage of national goods sold in stores (the European Commission
addressed a formal request to Slovakia in November 2015 to amend its
food law) have been considered as having the potential to be in breach of
the European legal order. In this regard, one can raise concerns about the
compliance of newly introduced amendments with the European
legislation. Such concerns have also been publicly raised by the Romanian
Competition Council within the consultation process regarding the
amendments to the Law.
The main concern from this perspective is the obligation to buy a majority
of products from the short supply chain together with the obligation to
organize promoting events for the Romanian products, which could both
create a competitive advantage for national products to the detriment of
imported ones.
Nonetheless, the short supply chain is not explicitly defined as referring
exclusively to operators/suppliers present in the Romanian territory. Thus,
the short supply chain involves a limited number of economic operators
active in the local economy and focuses on the close social and
geographical relations between producers, processors and consumers.
Since such a definition is not very precise and is focused more on the
reduced number of intermediaries, one may consider that also products
originating from Member States that are in the vicinity of Romania could
fall within the scope of this definition, as far as they could be considered
as local.
However, given the use of such general and uncertain terms, especially in
respect of what is to be considered local and by reference to which
entity, respectively the headquarters of the supermarket or each
secondary office/trading unit individually, it is expected that secondary
legislation will bring more clarity.
Furthermore, the potential qualification of the rule imposing the
organization of events for promotion of Romanian food products as a
measure having an effect equivalent to a quantitative restriction depends
on how this matter will be regulated by the local authorities, a cautious
approach being recommended.
Due to the social and administrative implications of the new rules on the
sale of local food products, the respective provisions of the Law shall enter
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into force after a period of 6 months starting from July 15 th, 2016, in order
to allow retailers sufficient time to adapt to the new requirements.