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    Home»Business»EU proposes emergency supply chain powers, surprises businesses
    Business

    EU proposes emergency supply chain powers, surprises businesses

    M.KaratasBy M.Karatas19. September 2022No Comments2 Mins Read
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    Wind turbines are seen at a wind farm 23 km (14 miles) off the coast in Ijmuiden, the Netherlands, on September 3, 2007. REUTERS/Michael Kooren

    Register now for free, unlimited access to Reuters.com

    BRUSSELS (Reuters) – Europe-based companies will be forced to prioritize production and stockpiles of key products under a proposed EU rule giving Brussels emergency powers to deal with supply chain crises there is a possibility.

    The single market emergency measure proposed by European Union officials on Monday is a response to the bottlenecks caused by the COVID-19 pandemic and Russia’s invasion of Ukraine.

    The proposal mirrors similar measures taken by the United States and Japan, and could face strong backlash from businesses and some European Union countries, fearing it would go too far by the European Commission. expected.

    Register now for free, unlimited access to Reuters.com

    “Whatever the risks we face, we need new tools that allow us to act quickly and collectively,” European Commission Vice-President Margrethe Vestager said at a press conference.

    Vestager sought to allay concerns that the draft rule could force companies to breach commercial agreements, voiding transactions based in third-country jurisdictions, unlike those bound by European contract law. Said it wouldn’t.

    Lobbying group BusinessEurope expressed its concerns in a paper published ahead of the EU’s announcement.

    The group said, “Intrusive and mandatory pre-market surveillance of ‘something that may or may not occur under certain circumstances that may change beyond our control.’ It doesn’t meet the principles of proportionality and necessity.”

    Business Europe said: “The same is true of some possible measures to mitigate the crisis.

    The draft rules would require the Commission to reorganize its supply chains and expand or reuse existing capacity or set up new capacity to market crisis-related goods, including Gives authority to order the supply to be increased as quickly as possible.

    Companies could be forced to prioritize the production of certain key goods under the rules, critics said, potentially breaching contractual obligations and exposing trade secrets. I’m here.

    Companies that provide inaccurate or misleading information can be fined up to €300,000 ($299,220). A company that fails to comply with orders to prioritize key products could face regular daily fines of his 1.5% of average daily turnover.

    ($1 = 1.0026 Euro)

    Register now for free, unlimited access to Reuters.com

    Reported by Foo Yun Chee.Edited by Philip Blenkinsop and Alexander Smith

    Our standards: Thomson Reuters Trust Principles.



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