€ 14 billion per year: this is the estimated cost of territorial supply constraints (CST) in retail trade for European consumers, according to a study by the European Commission published in July 2020.
The Benelux Union announced on Tuesday that it was 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, this often means lower prices for certain products in one country compared to another.
This is why the Benelux Union appealed this summer to Internal Market Commissioner Thierry Breton, Competition Commissioner Margrethe Vestager and Consumer Rights Commissioner Didier Reynders.
A level playing field must be created.
“For the Benelux, the coherence of the objectives of an integrated European internal market is essential”, declared Alain de Muyser, secretary general of the Benelux Union, in a press release. “A level playing field must be created. We, Benelux, wish to make a substantial and constructive contribution to the European debate. This is certainly the case with the issue of territorial supply constraints in the retail trade, which the Benelux countries are confronted with.
A long-standing issue for the Benelux countries
This subject has preoccupied the cross-border union since 2015, when its three respective economy ministers signed a recommendation aimed at strengthening cooperation on territorial supply constraints. Three years later, the Benelux published an investigation into the phenomenon, which concluded that such supply constraints were present in the three territories, with the particularity that in Luxembourg they extended beyond the retail trade.
In 2019, the Benelux Union asked the European Commission to take STCs into account in the assessment of the EU Block Exemption Regulation.
For the trio, these TSCs hamper the functioning of the European internal market and cross-border competition, of which Brussels is the designated guardian. “The European response, which is absolutely necessary, should reduce the possibility of ‘geo-blocking’ between companies, ensure fair trade and competition and facilitate parallel imports,” said the secretary general of the Benelux Union.
This article was originally published in Paper jam. It was translated and edited for Delano.