OFT probe into farm assurance

18 September 1998

OFT probe into farm assurance

By Jonathan Riley

THE Office of Fair Trading is investigating a number of accusations that farm assurance schemes are anti-competitive.

OFT Officials are looking into the Assured Combinable Crops Scheme, its sister scheme for horticulture, the Assured Produce Scheme, and the Trade Assurance Scheme for Combinable Crops.

Jamie Day, merchanting manager with supply trade organisation UKASTA, confirmed that competition watchdogs in the UK and Brussels had the schemes under review.

UKASTA has sent information about its own assurance scheme to the Office of Fair Trading and the EU competition directorate DGIV. After deliberation, the OFT voiced concern that the scheme might restrict trade.

A spokesman for the OFT spokesman said it had received a number of complaints about quality assurance schemes. But a full-scale investigation is not yet under way.

“Before we could do this we would have to establish that there are some grounds to the complaints concerning restrictions on competition,” the spokesman said.

Last week, representatives of the Federation of Small Businesses, which has lodged a formal complaint with Brussels claiming the schemes are anti-competitive, met DGIV officials.

Robert Robertson, chairman of the FSBs agriculture committee, confirmed that both the horticulture and cereal schemes were under investigation.

“Of particular interest to DGIV was the impact of the scheme on trade within the EU,” said Mr Robertson. “The investigation will make a formal decision which will either outlaw the schemes or allow them to continue operating.”

Jonathan Tipples, chairman of the ACCS, said: “Although I do not want to pre-empt decisions by either the OFT or DGIV, their involvement is standard procedure and we are not concerned.”

Meanwhile, Wye College has carried out a study of the ACCS sponsored by the Perry Foundation, a charitable trust which funds agricultural research projects.

The report, sue to be published this autumn, covers attitudes and perception of all links in the crops chain, from farmers to end users.

Food industry research director at the college Andrew Fearne said the study examines long and short-term projected costs of assurance schemes and the benefits of joining.

“The report makes surprising and interesting reading,” he said.