EU directive on trading practices in the food market: an interesting blend of brands, contracts, trade secrets and food regulation

The topical EU directive on unfair trading practices in business-to-business (B2B) relationships in the agricultural and food supply chain[1] blends together many interesting aspects of law that frequently tend to arise within the food industry. The main focus of the new legislation is on the fairness of B2B contractual clauses. However, brand protection, trade mark law, trade secret law and various aspects of food regulation should also be taken into consideration when reviewing legislative developments in this field.

Public discussion has been lively (both nationally and within the EU) regarding the initiative. There has been a lot of discussion especially around so-called private label products and trade secret protection. As before, trade secret legislation will continue to protect trade secrets between parties in a commercial relationship in the food industry, so the new legislation brings no changes in this regard. Thus, private label manufacturing will continue in the foreseeable future.

In Finland, a new government proposal[2] on amending the Finnish Food Market Act[3] was approved by the government in October 2020. The government proposal aims to implement the legislative changes as stipulated by the EU directive but it is subject to parliamentary proceedings and approval before it may enter into force.

According to the government proposal, the new legislation will give additional powers to the Finnish Food Market Ombudsman, which is the local authority overseeing the functioning of the food market and ensuring that businesses comply with good business practices. The Food Market Ombudsman, whose post was established in 2019, will oversee that the requirements as determined by the new legislation are complied with.

Bird & Bird has a strong focus on the food industry via our Retail and Consumer sector group, and more specifically our Food and Beverage subgroup. We constantly keep an eye out for developments in this area. Furthermore, in recent years the Intellectual Property group in Finland has contributed to a number of assignments within the food industry, advising clients on regulatory questions as well as various branding related aspects. If you would like any further information or advice about the implementation of, or compliance with, this Directive, then please contact your Bird & Bird advisor.

[1] Directive (EU) 2019/633 of the European Parliament and of the Council of 17 April 2019

[2] HE 199/2020 vp

[3] In Finnish: Elintarvikemarkkinalaki, 1121/2018