Australia’s food and grocery suppliers, represented by peak body the Australian Food and Grocery Council (AFGC), welcome the finalisation of the Food and Grocery Code of Conduct (Code) review process.

AFGC CEO Tanya Barden said that the purpose of the Code is to build and sustain trust and cooperation throughout the food and grocery supply chain, to ensure transparency and certainty in commercial transactions and to promote and support good faith in commercial dealings.

The new changes to the Code are designed to assist suppliers in their dealings with retailers, particularly in resolving disputes including in relation to pricing matters.

“This is a significant matter for suppliers, and we have been working consistently over the last two years to get a good workable outcome for members.

“We want to continue to have good working relationships with the retailers and we welcome their ongoing support for this Code,” said Ms Barden.

“We also want to thank and acknowledge the work by the federal Government and in particular Assistant Treasurers over the last two years who have worked with us to helped to bring Graeme Samuel’s independent review to fruition.

Key changes in the strengthened Code include:

  • An enhanced good faith obligation,
  • Limits on acceptable conduct during price rise negotiations to encourage streamlined negotiations, including a provision that prevents the retailer or wholesaler from requiring the supplier to disclose commercially sensitive information,
  • An improved dispute resolution framework, incorporating:
    • Retailer appointed Code Arbiters with the authority and autonomy to efficiently resolve supplier complaints, and
    • A Government appointed Independent Reviewer who will work to ensure suppliers are afford due process during any dispute resolution, as well as identify and address emerging and systemic issues related to compliance with the Code, and
  • A prohibition on retrospective variations to grocery supply agreements.

Ms Barden has welcomed the announcement of the three retailer appointed Code Arbiters with one more to be named in the coming days. These roles will be crucial, as they will be required to act independently of the retailer and can make binding recommendations to the retailer, including the payment of reparations to settle a dispute with a supplier. The Government is also still yet to announce the appointment of the Independent Reviewer – all key positions with the new Code.