The food and grocery code is now mandatory for Australia’s largest supermarkets and grocery wholesalers.
The Food and Grocery Code of Conduct sets the rules for how supermarkets and wholesalers negotiate and contract with their suppliers.
It requires them to have written supply agreements in place, act lawfully and in good faith towards their suppliers, and ensure suppliers do not face retribution for exercising their rights under the code.
Large supermarkets and wholesalers now face significant penalties for contraventions of the updated code.
The changes, which started on April 1, make the code mandatory for all retailers and wholesalers that earned more than $5 billion from their supermarket or grocery wholesaling businesses in the previous financial year.
Until April 1, the code was voluntary and grocery retailers or wholesalers could opt-in to being bound by the code.
The Australian Competition and Consumer Commission will now be able to issue infringement notices and take court action seeking penalties against businesses that contravene the code.
For the most harmful contraventions, this includes a maximum penalty per contravention that will be the greater of $10 million, or three times the value of the benefit derived, or — if that value cannot be determined — 10 per cent of the company’s turnover during the preceding 12 months.
The ACCC has also launched a new online portal for people to make anonymous reports about potential contraventions of the code. Businesses can also continue to make reports via the ACCC’s Infocentre.
Guidance on the updated code, including the ACCC’s approach to enforcement and compliance actions, is available at: https://www.accc.gov.au/
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