ACCC happy with Woolworths and Aldi’s efforts to resolve Food and Grocery Code concerns

Posted by AFN Staff Writers on 9th December 2015

GroceryThe Australian Competition and Consumer Commission (ACCC) says it welcomes the actions of Woolworths and Aldi to resolve concerns regarding implementation of the Food and Grocery Code (the Grocery Code).


In September 2015 the ACCC issued a public notification stating that both Woolworths and Aldi were being investigated for alleged breaches of the Food and Grocery Code. At the time, the ACCC said that both supermarkets were presenting Grocery Supply Agreements (GSAs) to suppliers in a way that made them appear non-negotiable.


The two supermarkets groups have now written to their suppliers saying the agreements are negotiable. The supermarkets have also clarified the effect of the Grocery Code on GSAs and the circumstances in which certain payments can arise.


The Grocery Code is aimed at strengthening the Competition and Consumer Act which came into effect in March 2015.


According to the ACCC, the Grocery Code is aimed at ensuring retailers provide certainty to suppliers due to their likelihood of holding weaker bargaining positions with retailers.


Clarity and certainty for suppliers


“One of the purposes of the Code is to provide certainty to suppliers, who are often in a much weaker bargaining position when dealing with retailers,” ACCC Chairman Rod Sims said yesterday.


“In order to provide that certainty, the ACCC expects retailers to be specific about circumstances in which they will seek payments from suppliers before they seek such a payment,” Sims said.


“The ACCC will continue to monitor compliance with the Code and encourages any suppliers experiencing issues with the implementation of the Code to contact the ACCC for a confidential discussion,” Sims continued.


“We welcome the commitment given and the actions taken by the relevant supermarkets to address the concerns raised by the ACCC,” concluded Sims.


The ACCC added that although not originally being named alongside Woolworths and Aldi, their rival Coles had also recently reminded its suppliers that it is prepared to negotiate its GSA’s.


Other relevant articles


“Woolworths and Aldi respond to ACCC Food and Grocery Code investigation” 28 September 2015


“ACCC defends Food and Grocery Code” 21 October 2015


“Fruit and vegetables wholesalers ‘left out’ of Food and Grocery Code of Conduct” 22 April 2015