A UK government committee has called for changes to the to the bill creating an adjudicator for disputes between suppliers and retailers under the Groceries Supply Code of Practice (GSCOP).
The Commons Business, Innovation and Skills Committee released a report yesterday (28 July) which calls for the adjudicator to be able to impose fines on retailers who treat suppliers unfairly.
It also called for more protection for suppliers who might be afraid of making a complaint against the supermarket.
As the draft legislation currently stands, the independent Groceries Code Adjudicator’s (GCA) only sanction will be to require stores to publish the results of its investigations. Only if this proves insufficient will ministers consider granting it the power to impose fines.
However, Labour MP and committee chairman Adrian Bailey said: “We disagree with the Government on the introduction of fines, however. We propose that fines be an available penalty from the start, not least so that the adjudicator’s performance can be judged on the basis of a full package of remedies.”
Bailey said the committee agreed that they do not believe that the adjudicator needs powers to investigate pro actively, without any supporting complaint, but has suggested that additional sources, such as trade bodies, can act as a useful source of evidence and provide anonymity for suppliers.
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By GlobalDataIt also calls for indirect suppliers to be able to draw attention to code breaches, despite not being covered by the code.
Commenting on the report, the Food and Drink Federation’s director of communications, Terry Jones, said: “We are particularly pleased that the Committee is convinced that trades associations such as FDF can provide information on abuses of market power. Not only are we best placed to identify patterns of behaviour that breach the Code, but also provide much-needed additional anonymity for suppliers. This will help ensure that the food chain operates fairly and is in the best interests of consumers.”
He said that fines will be a “more effective deterrent” for those looking to breach the code, and that an effective GCA will be good news for both consumers and suppliers – particularly small to medium-sized businesses.
“A strengthened code alongside a GCA with teeth will ensure that grocery suppliers have the confidence to innovate and invest, offering choice and availability to consumers,” he added.