The Code of Practice drawn up by the Competition Commission to govern supermarkets’ relationships with their suppliers has been criticised by the NFU as not doing enough to help farmers and growers.
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The NFU is deeply concerned that there are too many elements in the draft code which are open to interpretation by supermarkets and which therefore fail to protect suppliers.
And the code will only apply to the top five supermarkets, which the NFU fears will leave farmers and growers supplying smaller retailers vulnerable.
The NFU initiated the need for a Code of Practice more than two years ago after complaints from farmers and growers that they were threatened by excessive or unreasonable demands of supermarket contracts.
A legally-binding code was one of the “remedies” suggested by the Competition Commission when it published its report last year on supermarkets’ relationships with their suppliers.
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By GlobalDataResponding to a consultation on the document, NFU President Ben Gill said the NFU has identified a series of problems with the draft.
Mr Gill said: “This code is not as robust a document as we believe is justified.
“It is littered with problems, both generic and specific. For example, the term “reasonable” is stated throughout the code but without any definition.”
The code does not effectively tackle the problem of supermarkets demanding contributions from suppliers towards marketing costs or towards buyers’ visits.
Neither does it address the issue of supermarkets forcing farmers and growers to pay compensation when profits from the sale are lower than expected or for wastage of products incurred at stores, he said.
Mr Gill added: “We were very pleased when the Competition Commission agreed with us on the need for a code.
“But this draft document will need further work before it represents a fair balance in the bargaining power between farmers and supermarkets. We shall be fighting for substantial changes to large areas of it.”
Although every effort has been made to ensure the accuracy of the information provided in this document, the NFU cannot accept liability for errors and omissions. This information should not be regarded as constituting legal advice, and should therefore not be relied upon as such. NFU©
