French poultry group Tilly-Sabco is to take legal action against The European Commission for Brussels’ decision to end subsidies to support exports outside the EU.
Tilly-Sabco said yesterday (23 July) proceedings would start in the coming days against the Commission’s move, which had not been expected to come in until 2015.
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The company, alongside fellow French poultry exporter Doux, have hit out at the decision. In a joint statement last week, the processors said the end of the subsidies, which have been in place since 1965, helped French firms compete with rivals from markets where costs are lower, including Brazil. In the last year, the subsidies had fallen by two-thirds to EUR108 (US$143) a tonne ahead of the planned end to the support in 2015.
Doux and Tilly-Sabco have claimed the decision to pull the subsidies early means “thousands” of jobs are at stake.
Tilly-Sabco, which generates 80% of its turnover from sales to the Middle East, also announced yesterday it was suspending supplies from 200 farmers.
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Doux claims to be Europe’s largest poultry exporter, supplying more than 100 markets. It has been in administration for over a year after running up debts of EUR430m. In May, Doux had its period in administration extended for another six months while its restructures the business.
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