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AIM welcomes the European Commission’s fact-finding approach to “territorial supply constraints” in the EU

Brussels, 24 May 2024. Following the discussion in the Competitiveness Council, the European Commission has proposed to initiate a fact-finding mission on “territorial supply constraints” in the EU. AIM welcomes this fact-finding approach, which should provide insights and clarity on how the markets operate in each of the Member States.  

“Our brands are trusted and enjoyed every day by consumers across the EU”, commented Michelle Gibbons, Director General of AIM, the European Brands Association. “Meeting their needs and expectations also means bringing innovation, value and choice to them, no matter where they shop. This Commission-led initiative should include all stakeholders in the consumer goods ecosystem, including Member States, to determine the differences that remain in each country which are factors also in pricing decisions, such as different rules on packaging, labelling, transport, and taxes, amongst others”. 

AIM has called for a more fact-focused approach on this issue for many years. Competition rules are in place to deal with the contractual arrangements and commercial situations between businesses in the private sector. However, different rules continue to exist across countries which should be assessed, as well as different economic situations including consumer purchasing power. Given household consumption is 51% of the EU’s GDP, it is important that governments taking decisions on taxes, for example VAT, are also part of this initiative.  

“A factual overview of the economics behind household consumption, as well as how the market operates in each country, should help to address some of the issues” remarked Michelle Gibbons. “EUR 276 billion of the consumer goods manufactured in the EU cross internal borders every year, demonstrating the value of the Single Market. We all have a role to play in the consumer goods ecosystem to support consumers and need to take all dimensions into account. As the consumer goods industry, we want to achieve the best outcome for all in our value chain, from our own suppliers which includes SMEs & farmers right through to consumers, to ensure resilience and continue to deliver the brands that consumers love”.  

The fast-moving-consumer-goods industry is the third largest manufacturing industry in the EU, representing 11.6% of all manufactured goods in the EU, and continues to deliver for households, despite the impact of supply chain disruptions.  61% of that production is exported within the EU, at a value of EUR 276 billion, with the remaining 39% (EUR 174 billion) exported around the world. EU brands are highly sought after on global markets and represented 33% of the EU’s positive trade balance in the latest available figures. Investing EUR 81 billion a year in the EU, the fast-moving-consumer-goods industry is also a significant contributor to the EU’s competitiveness footprint, and welcomes the focus on EU competitiveness, as agreed in the Competitiveness Council conclusions.