The Commission issued today its first opinion regarding the compatibility of a sustainability agreement with competition rules for the agricultural sector. The opinion concerns an agreement on the setting of indicative prices for wine produced in accordance with the standards for organic and for Haute Valeur Environnementale ('HVE') wines, in the French region of Occitanie. The envisaged agreement is between producers of wine meeting these standards and buyers of such wine, to guide bulk wine transactions. The objective is to incentivise the relevant producers to maintain their sustainable production practices.
The sustainability agreement
Producers of wine meeting the organic and HVE standards and active in the French Occitanie region requested the Commission to provide an opinion on the compatibility with Article 210a of Regulation (EU) No 1308/2013 establishing a common organisation of markets in agricultural products (' CMO Regulation ') of their envisaged agreement with buyers of such wine on indicative prices (so-called "orientation prices"), to guide bulk wine transactions.
The French wine sector is currently experiencing significant oversupply, changing consumer preferences, and increased consumer price sensitivity linked to inflation. In addition, consumers of wine are often unaware of the cost of sustainable production. In this context, many producers of organic and HVE wine are less profitable than conventional wine producers and might either switch to conventional production or exit wine production altogether.
Under the envisaged agreement, to incentivise producers to keep producing sustainably, the orientation prices will be set at a level covering the costs of producing in accordance with one of the two relevant sustainability standards (organic or HVE), in addition to a profit margin of up to 20% of such costs. The orientation prices will be set on an annual basis for each standard, and for six grape varieties. The agreement will be in place for two years.
The Commission has found that the agreement complies with all conditions of Article 210a of the CMO Regulation. In particular, the Commission concluded that the envisaged agreement:
- involves agricultural producers;
- relates to the trade in agricultural products;
- aims at contributing to several sustainability objectives and at applying sustainability standards that are higher than what is mandated by Union or national law; and
- any possible restriction of competition stemming from the agreement is indispensable for the attainment of those standards.
On this basis, the Commission issued a positive opinion on the agreement.
Background
Article 101 (1) of the Treaty on the Functioning of the European Union ('TFEU') generally prohibits agreements between companies that restrict competition, such as those between competitors that can lead to higher prices or lower quantities. However, in the context of the Common Agricultural Policy reform for 2023-2027, the European Parliament and the Council of the European Union adopted in 2021 an exclusion from this prohibition, for agricultural products.
More specifically, Regulation 2021/2117 introduced this exclusion via a new Article 210a in the CMO Regulation . This provision allows agreements aimed at achieving a set of sustainability objectives, by applying standards higher than what is mandatory under EU or national law, provided that any restrictions of competition that result from such agreements are indispensable for the achievement of those objectives. Article 210a enables agricultural producers to request an opinion from the Commission regarding the compatibility of their sustainability agreements with this provision's conditions.
On 7 December 2023, the Commission adopted Guidelines clarifying how operators active in the agri-food sector can design joint sustainability initiatives in line with Article 210a.
On 21 March 2025, the Commission received a request for an opinion regarding the present sustainability agreement. Under Article 210a, the Commission had to issue its opinion within four months of the request, which it did.
