Friday, 06 September 2019 11:25

Press Release - Evaluation of the effectiveness of the commitment to the minimum guaranteed producer price

Subject: Evaluation of the effectiveness of the commitment to the minimum guaranteed producer price provided for in Decision 650/2017 of the Hellenic Competition Commission and the conditions of competition in the market for raw cow’s milk (A.1 - A.1.1), in order for the Commission to decide in favor of lifting or extending the above commitment, under condition A.1.2 of the same Decision.

The Plenary Session of the Hellenic Competition Commission (HCC) will meet on October 22nd, 2019 to evaluate, following theStatement of Objections of the General Directorate of Competition, the effectiveness of the commitment A.1 - A.1.1 provided for in Decision 650/2017 of the HCC and the conditions of competition in the market of raw cow’s milk, in order to decide in favor of its removal or its extensionfor another two (2) years, pursuant to condition A.1.2 of the commitments’ Decision.

Specifically, according to the above commitment, the companies “DELTA TROFIMA S.A” and “MEVGAL S.A” undertook to buy (directly or through third parties) raw cow’s milk from each milk producer - breeder, with whom they had a cooperation agreement on 21.10.2017 in the Prefectures of Serres, Kilkis, Thessaloniki, Imathia, Kozani, Pella, Florina, Kavala, Xanthi, Grevena, Pieria and Halkidiki,at a minimum guaranteed price, based on a specific mathematical formula1.This commitment also covers those milk producers who were cooperating on 21.10.2017 with either of the two companies, but this cooperation was interrupted by the producers, and may have been resumed. In any case, each of the companies “DELTA TROFIMA S.A” and “MEVGAL S.A.” retains the opportunity to offer higher prices.

Based on the rationale of the Statement of Objections (SO), after evaluating the effectiveness of the above commitment and the general conditions of competition prevailing in the market of raw cow’s milk, as they were formed by the commitment, it is proposed to extend the validity of the above commitment provided for in Decision 650/ 2017 for another two years.

It is noted that the SO proposal isn’t binding for the HCC, which will decide taking into account the facts of the investigation and the views of the parties involved.

1 For the calculation of the minimum guaranteed price, the weighted average price ELGO DIMITRA and the weighted average price of each buyer (“DELTA TROFIMA S.A” and “MEVGAL S.A”) to each breeder are taken into account.

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