Industrialists, how do you navigate Egalim III?

In case of a deadlock on the endorsement from your independent third party.

Special article following numerous inquiries regarding a stalled situation concerning the sanctuarization principle of agricultural raw material prices Egalim III since January 16th.

Reminder on the Egalim III System

It is the responsibility of the distributor to prove that the commercial negotiations concluded last Wednesday did not involve the variation of agricultural raw material prices, namely:

  • By presenting, in their general terms of sale, relative or absolute data related to agricultural raw materials (options 1 or 2);
  • By entrusting an independent third party to certify the sanctuarization of agricultural raw material prices, through two attestations: one upstream of the commercial negotiation – specifying the share of the variation in raw material prices in the rates – and the other downstream – confirming that the negotiation did not concern said share (option 3).

Under this option 3, the independent third party verifies, since January 16th, that the signed rates are:

  • either lower than the old rates weighted by the share determined upstream (in case of a decrease in the cost of agricultural materials);
  • or higher than the old rates weighted by the share determined upstream in case of a decrease in the cost of agricultural materials).

When this calculation does not satisfy – for example, in the case of a tariff increase simultaneous with decreases in agricultural prices – some independent third parties may refuse to sign the downstream attestation.

 

A deadlock with your independent third party?

As officiating ourselves as independent third parties, we are aware that additional elements can be provided to enable the independent third party to proceed with the attestation.

We can therefore act as mediators to unlock the situation and facilitate the signing of the attestation.

We emphasize that the authorities will be uncompromising regarding the implementation of the Egalim III system this year (notably due to the presumed importance of the mechanism in the fight for purchasing power).

 

in a nutshell:

Do not hesitate to contact us before your deadlines on February 15th and 29th to intervene in these situations

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