Defra to introduce new regulation to govern pig contracts
Defra has confirmed that it will introduce new regulation to govern pig contracts, as it releases a summary of the responses to the consultation on contractual practice in the UK pig sector and sets out its next steps.
The Department has also stated that it will share its findings relating to the alleged negative consequences of market consolidation in the pork processing sector with the Competition and Markets Authority (CMA).
The consultation, which closed in October, received a total of 374 industry responses. Defra said these responses received have ‘demonstrated that there are legitimate concerns about the nature of business relationships in the UK pig sector’.
“There is a clear demand for a legislative solution, and evidence of a popular sentiment that legally required written contracts would remove the uncertainty and ambiguity which has underlain recent issues,” it said.
But it said there is a far weaker consensus regarding what mandatory written agreements should cover and whether these agreements should be standardised throughout the sector.
“A substantial number of responses stressed the need for a light-touch, flexible approach to any future legislation to account for the wide variation in business arrangements found in the sector. Producers also generally recognised that too much contractual rigidity could have unintended consequences on the market,” it said.
Alistair Driver | Pig World
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