Derogation from EU competition rules for milk, potato and live plant and flower sectors

On 4 May 2020 the European Commission announced temporary derogations from EU competition rules for the milk, potato and live plant and flower sectors. The derogations form part of the European Commission's response to the COVID-19 pandemic and aim to bring much-needed support to these sectors during the crisis.

On 2 June 2020 the Bulgarian Commission for the Protection of Competition (CPC) published on its website information about temporary derogations from the prohibition to enter into agreements or coordinated practices among competitors in these sectors. Although the derogations are in line with EU law, the adopted measures allow farmers, farmers' associations, associations of such associations, recognised producer organisations, associations of recognised producer organisations and recognised inter-branch organisations in the relevant sector to adopt temporary measures to stabilise how these sectors function.

The measures apply for up to six months and authorise:

• the conclusion of agreements and taking common decisions on planning the volume of raw milk to be produced in the milk and milk products sector (the measures apply for six months from 1 April 2020 until 1 October 2020);
• the conclusion of agreements concerning potatoes for processing and taking common decisions concerning potatoes for processing on market withdrawals and free distribution, transformation and processing, storage, joint promotion and temporary planning of production in the potatoes sector (the measures apply for six months from 5 May 2020 until 5 November 2020); and
• the conclusion of agreements and taking common decisions on market withdrawals and free distribution, joint promotion and temporary planning of production in the live plants and flowers sector (the measures apply for six months from 5 May 2020 until 5 November 2020).

The measures (ie, agreements or decisions) are admissible after notification to the CPC and the Ministry of Food and Agriculture (MFA). Notifications should be made immediately after the conclusion of an agreement or a decision and should set out an estimate of the volume of production covered. There is no standard form of notification and no explicit approval by the CPC or the MFA is required.

An additional notification about the actual volume of production subject to the agreement or decision must be filed with the CPC no later than 25 days after the end of the agreement or decision period.

The above derogation does not concern agreements or decisions that have as their object or effect share markets or sources of supply or discrimination based on nationality or price fixing.

For further information on this topic please contact Galina Petkova at Advokatsko Druzhestvo Stoyanov & Tsekova in cooperation with Schönherr by telephone (+359 2 933 1072) or email (g.petkova@schoenherr.bg). The Advokatsko Druzhestvo Stoyanov & Tsekova website can be accessed at www.schoenherr.eu.