Q-Meieriene threatens legal action after measures taken by Pollestad – E24

The government is cutting support for Q-Dairies. Three things make the Q manager consider taking the state to court.

The Q Dairies risk losing subsidies worth around NOK 50 million a year.

The dairy challenger believes that the move will be invalid for several reasons.

1. The proceedings

Q-Meieriene believes that the case management has not been good enough and is calling for an impact investigation. They refer to what the Regulatory Council has given “red light”. “red light”.This means that they believe it has not been sufficiently investigated. They point out particular shortcomings in the assessment of effects, including how it will affect competition and innovation in the dairy sector.

– The flawed and one-sided case management – where clear, professional objections are ignored and the requirements of the investigation instructions are not complied with – is in itself sufficient to establish invalidity.

The company writes this in a letter that E24/Aftenposten has seen.

2. The milk settlement

Q-Meieriene further believes that a liquidation would constitute a breach of the so-called “milk settlement” from 2007.

At the time, the Q Dairies were ready to take legal action against the state for what they believed to be impossible framework conditions.

When Agriculture Minister Terje Riis-Johansen introduced a package of competition-promoting measures, the lawsuit was withdrawn.

The support schemes should permanently provide reduced fees or higher subsidies to independent dairy companies in areas where Tine dominates, the Center Party minister announced.

That the government will now partially wind up the competition-promoting measures constitutes “a clear breach of the milk agreement”, according to Q.

– This will lead to weakened competition in the dairy sector, as the Norwegian Competition Authority and several other consultation bodies have pointed out, the company writes in the letter.

3. Expectations about framework conditions

Q-Meieriene refers to “the illegal doctrine of abuse of authority” as the third reason for a possible lawsuit.

The company refers to their “justified expectations of stable framework conditions”. This was the basis for the decision to invest an amount of billions in facilities and technology in recent years. Among other things, a new storm dairy on Jæren.

– If, contrary to presumption, a decision were to be made in accordance with the consultation memorandum, (…) it is notified that Q-Meieriene will consider taking legal action in connection with the matter, without further notice.

Fate date

Before Christmas, Agriculture Minister Geir Pollestad (Sp) got serious about plans to cut support for Tine’s competitors.

Now the Directorate of Agriculture has sent new rates in the price equalization scheme for milk out for consultation, as they do every year.

The hearing deadline is 10 May. Q manager Kristine Aasheim tells E24 that the outcome of the hearing will largely determine what happens next with the possible lawsuit.

– It depends on whether you take into account and do not break the milk settlement. We hope the hearing is real, because we have not given up hope that the facts will emerge, she says.

Demand compensation

Aasheim is no stranger to suing the state.

Before Christmas, Q-Meieriene announced a compensation claim for loss of income and weakened market position. The claim is NOK 32 million.

The background is a decision that the Norwegian Directorate of Agriculture made in the autumn of 2021. Q-Dairies and Rørosmeiriet got the distribution subsidy the distribution subsidyThis is a support scheme aimed at Tine’s competitors, which will provide compensation if the distribution costs are “significantly higher” than at the former monopolist. cut.

The company appealed and was upheld. In the period between, the Q Dairies had to increase their prices, according to the Q manager. It affected sales negatively, she says.

Aasheim says that they are now working on the pleadings for the trial. It has not been scheduled yet, but she says she expects it to be carried out after the summer.