Unfair Commercial Practices in the Italian Agri-Food Supply Chain: Five Years On, What Has Changed?

Abstract: In February 2022, this previous article examined the adoption of Legislative Decree No. 198 of November 8, 2021 (the “Decree”), through which Italy transposed Directive (EU) 2019/633 (the “Directive”) on unfair commercial practices in business-to-business relationships within the agri-food supply chain.

Four years later, the regulatory framework has evolved and the landscape has changed in part: the Italian legislature has made several amendments to the Decree, the designated enforcement authority has significantly stepped up its activities, and the first court decisions regarding the application of the Decree have been issued.

This article aims to provide an updated overview.

The Regulatory Framework: Original Structure and Subsequent Amendments

The implementation of the Directive provided the Italian legislature with an opportunity to overhaul the pre-existing national regulations governing the agri-food supply chain—in particular those set forth in Article 62 of Decree-Law No. 1/2012. The result is a unified and systematic regulatory framework on the subject, contained in the Decree that entered into force on December 15, 2021.

For an analysis of the structure and key provisions of the Decree, please refer to the previous article. The fundamental structural choices described in that article remain in effect: the Decree establishes mandatory contractual requirements for operators in the agricultural and food sector, identifies unfair practices that are always prohibited (the so-called “blacklist”) and those prohibited unless otherwise agreed in writing by the parties (the so-called “gray list”), regulates below-cost sales (not covered by the Directive), provides for a comprehensive system of penalties to punish any violations, and designates the Central Inspectorate for Quality Protection and Fraud Prevention (ICQRF) as the authority responsible for monitoring compliance with the Decree’s provisions.

What is of interest here are the legislative amendments that have modified and supplemented the original text of the Decree. As will be seen, these amendments have tightened regulations that were already stricter than European standards at the time of the Decree’s adoption.

The first amendment was introduced by Decree-Law No. 21/2022, which expanded the definition of perishable products to include meat-based products with specific physicochemical characteristics, and extended the applicability of the 30-day payment terms to the following agricultural and food products:

“a) prepackaged products bearing an expiration date or a minimum shelf life not exceeding sixty days;

1. b) bulk products, even if placed in protective packaging or refrigerated, that have not undergone treatments designed to extend their shelf life beyond sixty days;
   c) meat products exhibiting one of the following physicochemical characteristics: a^wgreater than 0.95 and pH greater than 5.2, or a^wgreater than 0.91, or pH equal to or greater than 4.5;
2. d) all types of milk.”

Subsequently, Decree-Law No. 69/2023 expanded the scope of the Decree to include “suppliers established in other Member States or in third countries when the buyer is established in Italy.” Therefore, today, the Decree applies to all business-to-business (B2B) sales contracts in which the supplier and/or the buyer is established in Italy, regardless of the parties’ turnover and the law applicable to the contract. This is an extremely broad scope of application, capable of effectively encompassing any commercial relationship in which at least one of the parties is Italian. This deliberate departure from the differentiated turnover thresholds provided for by the Directive—justified, according to the legislature, by the extraordinary fragmentation of the Italian agri-food supply chain—continues to define the broader scope of the Italian regime compared to the minimum level of harmonization established by the EU.

Decree-Law No. 69/2023 also amended the minimum notice period for the buyer’s cancellation of orders for perishable products, prohibiting any “notice period so short as to reasonably lead one to believe that the supplier cannot find alternative outlets for its products” and delegating to a subsequent implementing regulation (not yet issued) to establish specific rules governing this matter. Finally, the provision extended to foreign suppliers the right to file complaints with the national enforcement authority (ICQRF).

The most recent amendment to the Decree was introduced by Decree-Law No. 63/2024, which

• added the provision that the supply price must take into account the cost of production
• specified that wholesale markets also fall within the scope of the Decree
• included, among the documents that the ICQRF may obtain, accounting documents relating to sales activities and related services, and
• introduced the possibility of paying any penalties imposed under the Decree at a reduced rate, provided the contractor demonstrates that it has taken all appropriate measures to mitigate the harmful consequences of the violation alleged by the authority.

The cumulative effect of the amendments outlined above is the establishment of regulations that are even stricter than those that took effect in December 2021 (which were already significantly more restrictive than the Directive).

Mandatory Contractual Requirements: Persistent Compliance Challenges

Article 3 of the Decree imposes several mandatory requirements for contracts for the sale of agricultural and food products: written form, a minimum term of 12 months, specification of the product’s quantity and characteristics, a fixed or determinable price that reflects production costs, and definition of the terms of delivery and payment.

However, the legislature’s intention to establish a system that safeguards the contractual rights of the parties has clashed with the reality of commercial transactions in this sector. In fact, experience has shown that these contractual requirements remain the primary source of difficulty for operators in complying with the Decree. It is therefore not surprising that many of the objections raised by the ICQRF over the years have concerned precisely this aspect.

The written form requirement is particularly critical: a significant percentage of operators, especially in sectors characterized by long-standing informal commercial relationships (the prime example being the wine sector), continue to conclude transactions without an adequate written framework agreement, relying instead on commercial customs and verbal agreements that the Decree does not recognize as sufficient. It is no coincidence that the reports issued by the ICQRF in recent years list the failure to enter into written contracts prior to the delivery of the products sold   among the most frequent violations found.

Another aspect that is frequently penalized is the unilateral modification of prices: in several cases, buyers have attempted to adjust agreed-upon prices without the supplier’s written consent—a practice that the Decree expressly prohibits and that has been the subject of the first judicial decisions issued on the matter (which will be discussed in paragraph 6).

Italian Specifics: Additional Prohibited Practices and Below-Cost Sales

In addition to the “black list” and “gray list” of unfair practices prohibited by the Directive, Article 5 of the Decree identifies and prohibits 16 additional unfair practices, which stem from the pre-existing Italian regulatory framework. These include, for example, the purchase of agricultural and food products through double-reduction electronic tenders and auctions, the application of objectively different conditions for equivalent services, and the obtaining of undue unilateral benefits not justified by the nature or content of the commercial relationship.

An interesting feature of the Italian list is its explicitly bilateral nature: unlike the Directive, which was designed to protect suppliers from potential abuses by larger and more powerful buyers, Article 5 of the Decree prohibits various unfair practices that also apply to suppliers, including the imposition of an unduly short expiration date, the forced maintenance of a specific product range, and the requirement to reserve a privileged shelf position for certain products. The Decree, therefore, also protects—in certain cases—buyers.

Another distinctive feature of Italian law (and that of a few other countries in the European Union—Spain, Croatia, and Hungary) is the regulation of below-cost sales, which is not covered by the Directive.

Under Article 7 of the Decree, sales below production cost are permitted only in two circumstances:

• when perishable products are at risk of spoilage, or
• if the commercial transaction has been planned and agreed upon in writing with the supplier. In all other cases, the price of the product sold below cost is automatically adjusted.

It should be noted that the replacement criteria specified by the legislature (purchase invoices, average production costs, average product price) are unclear and have been subject to various interpretations.

The penalties for violating the ban on below-cost sales are severe: administrative fines ranging from 1 to 6 million euros and suspension of business operations for up to 20 days in cases of repeat offenses or particularly serious violations.

In any case, selling below cost is not merely a national issue; in fact, in its report dated December 1, 2025, on the evaluation of the Directive, the Commission indicated that it will propose a revision of the Directive to establish the principle that farmers should not be forced to systematically sell their products below production costs. We can therefore expect changes to the European regulations governing this issue.

The Penalty System

The Decree contains a comprehensive system of penalties, calibrated according to the nature and severity of the violation.

Failure to comply with the provisions of the Decree results, depending on the case, in three types of consequences, which may apply cumulatively:

1. Invalidity of the offending contractual clause, which is automatically replaced where the Decree so provides: for example, a term of less than 12 months is extended to that minimum period; a price below the cost of production is adjusted upward.
2. Monetary penalties: fines ranging from a fixed minimum of between 1,000 and 30,000 euros, depending on the obligation violated, to a maximum varying from 3% to 5% of the annual revenue of the party responsible for the violation, which may be increased up to two or three times in the event of repeated violations, with an overall maximum limit of 10% of revenue. With specific regard to unfair practices, Article 10 of the Decree provides that those included on the “blacklist” are subject to administrative penalties ranging from 30,000 euros to 5% of the previous year’s revenue; those included on the “gray list” are subject to fines ranging from 15,000 euros to 3% of revenue; other practices prohibited under Article 5 are subject to penalties ranging from 5,000 euros to 4% of revenue.
3. Compensation for Damages: Injured parties and their representative organizations may, in any case, file claims for compensation for damages (all of which must be proven).

As previously mentioned, starting in 2024, an operator subject to a monetary penalty may, within a strict deadline of thirty days from the notification of the injunction order, pay the penalty at a 50% reduction if the operator demonstrates that it has taken all appropriate measures to eliminate the harmful consequences of the violation alleged by the authority.

Enforcement of the Regulations: The Expanding Role of the ICQRF

Four years after its designation as the competent supervisory authority in Italy pursuant to the Decree, the ICQRF (Central Inspectorate for Quality Protection and Fraud Prevention) has become one of the most active supervisory bodies in the European Union in this sector. Working in coordination with the Guardia di Finanza and the Carabinieri Command for the Protection of Agri-Food Products, it conducts inspections both in response to reports and on its own initiative.

The gradual intensification of this agency’s activities is remarkable. In 2022, the ICQRF conducted 139 inspections. By 2025, that number had risen to 3,536. Inspections resulting from complaints are—in fact—extremely rare, while the majority of inspections are carried out on the agency’s own initiative. Operators’ reluctance to file complaints—a phenomenon common across all EU member states and largely attributable to fears of commercial retaliation by stronger business partners—has made proactive enforcement the primary mechanism in practice.

The most recent ICQRF reports confirm a significant upward trend in the volume of inspections, the number of operators investigated (76 in 2022 versus 1,430 in 2025), and the number of violations detected (15 in 2022, 562 in 2025). The sectors subject to the most frequent inspections are dairy products and fruits and vegetables, both characterized by large, structurally powerful buyers and a highly fragmented supplier base.

The most commonly found violations include unilateral changes to contractual terms by the buyer, failure to comply with mandatory payment terms, and the absence of written sales contracts.

Case Law on Unfair Practices in the Agri-Food Supply Chain

The intensification of inspections and the issuance of injunctions against operators has, as was to be expected, led to the first disputes and, consequently, to the first court decisions regarding the Decree.

Following appeals filed by certain operators in the dairy sector against administrative sanctions imposed for unilaterally modifying the agreed-upon price of milk, several trial courts (specifically the Court of Brescia and the Milan Court of Appeals) have confirmed that any price modification requires the written consent of all contracting parties. This is consistent with the text of the Decree, which prohibits unilateral changes to agreed-upon contractual terms and requires that agreements between the parties be in writing.

In Judgment No. 1225 of April 29, 2025, published on June 12, 2025, the Milan Court of Appeals ruled that a letter revising the criteria for calculating the price—sent by the buyer to the supplier, not preceded by negotiations between the parties, and not signed by the supplier to indicate acceptance—constitutes a unilateral modification of the contractual terms relating to the price, which is punishable under Article 4(d) of the Decree. In fact, it cannot be considered a written agreement (since it is signed by only one party). It is true that Article 3 of the Decree provides for the possibility of fulfilling the written form requirement through “equivalent forms,” but this is conditional on the fundamental contractual elements (including the price) having been previously agreed upon between the buyer and the supplier through a framework agreement.

Therefore, it is irrelevant that, in the present case, the supplier, by continuing to make deliveries, behaved in a manner that could be construed as tacit acceptance of the amendment, given that price agreements cannot be established through “equivalent forms.”

The body of case law remains limited, so it is premature to draw definitive conclusions about the direction of case law in this area.

However, there is no doubt that the operational boundaries of the penalty regime are gradually being defined and the interpretive limits of the Decree’s provisions are being clarified.

Conclusion

The Italian regulatory framework governing unfair commercial practices in the agricultural and food supply chain has, in the more than four years since its entry into force, moved from theory to practical application.

The basic framework described in the previous article has been supplemented by subsequent legislative amendments, and enforcement of the regulations is overseen by a regulatory authority that has demonstrated both the will and the capacity to act. The proactive approach of the ICQRF, which is increasingly active in its role as an enforcement authority, leaves no doubt that compliance with the Decree is a practical imperative, not merely a theoretical one.

For operators active in the Italian agri-food supply chain—whether they are suppliers, buyers, or intermediaries—the priorities are clear:

• contracts must be in writing and comply with the mandatory requirements set forth in the Decree
• business practices must be reviewed to verify their compliance with the law and ensure they do not fall under the list of prohibited practices, and
• Business processes must ensure that each operator adheres to good commercial practices in its dealings with its partners and other operators in the supply chain.