Food and Grocery Industry Code of Conduct takes effect

The Food and Grocery Industry Code of Conduct has taken effect, establishing a clear set of principles governing the trading relationships between retailers and suppliers. The regulations will be binding for retailers who choose to sign up to the code and will be enforced by the Australian Competition and Consumer Commission (ACCC).

The Australian Food and Grocery Council (AFGC) described the tabling of the code in parliament as a historic step towards levelling the playing field for food and grocery suppliers in their transactions with the major supermarkets.

“Signing onto the code will be a mark of the retailer’s commitment to fair dealing and to improving the operation of one of the most dynamic and competitive sectors of the economy - the fast-moving consumer goods sector,” said AFGC CEO Gary Dawson.

Key aspects of the code include:

• Tough restrictions on retrospective and unilateral variations to grocery supply agreements;
• Greater transparency on the basis of shelf allocation for branded and private label products;
• Recognition of the importance of intellectual property rights and confidentiality in driving innovation and investment in new products; and
• A low-cost and fast-track dispute resolution mechanism.

“It provides a real opportunity to drive changes in behaviour and be a real circuit breaker in retailer-supplier relations by entrenching new standards of behaviour including at buyer level,” said Dawson.