Retailers slam ‘paddy tax’ push by Jacob Fruitfield
Retailers have hit out following legal threats from Jacob Fruitfield not to bring in brands from cheaper sources that it distributes
17 December 2009 | 0
Last month Jacob Fruitfield sent letters to individual retailers threatening to take legal action against them if they continued to source products for which it holds the licence in Ireland more cheaply elsewhere. Certain retailers have begun procuring brands such as McVitie’s and Jacob’s Fig Rolls from the UK for less than is being charged by the licenced distributor in ROI.
Independent grocer’s association, RGDATA has hit out at Jacob Fruitfield for what it believes to be legally unfounded threats, and has called on the Tánaiste and Minister for Enterprise, Trade and Employment, Mary Coughlan, to intervene in the matter. The organisation has said that, if necessary, legislation should be introduced to prevent a distributor or supplier hindering Irish retailers from accessing cheaper goods through other EU countries as they should be entitled to under EU law.
“Independent retailers are infuriated because it is possible to source Jacobs’ products at much cheaper prices via other EU countries. This means that retailers can offer much better prices in their shops for their biscuits, crackers, jams and sauces,” said Tara Buckley, director general of RGDATA.
She added that it is “incumbent” on retailers to source their products at the cheapest price possible, “rather than have to pay inflated prices, or what has been called a “paddy tax” by virtue of our location as an island on the edge of Europe.” Buckley also said that she has asked the Tánaiste to make necessary amendments to the Trademarks Act, to ensure that national trademark legislation cannot be used to inhibit the business of retailers in the way that Jacob Fruitfield is now attempting.
The biscuit maker’s executive chairman, Michael Carey told RTÉ Radio however, that the company will “defend” its products against large and small retailers infringing its rights.
Retailers have expressed anger at the move particularly due to the fact that Jacob Fruitfield has moved much of its manufacturing out of Ireland, to the UK and Portugal, retaining only around 120 jobs at home. Its Cork and Drogheda plants are still producing certain premium biscuits, sauces and jams.