Queen confirms introduction of Groceries Code Adjudicator

The Queen has today (9 May) confirmed that the government will be introducing legislation for a Groceries Code Adjudicator (GCA). In her speech to both Houses of Parliament, she said the adjudicator would “ensure supermarkets deal fairly and lawfully with suppliers.”

The Department for Business, Enterprise and Skills (BIS) confirmed that the GCA would address competition issues by arbitrating disputes between retailers and suppliers, investigating anonymous complaints, and taking sanctions against retailers who break the rules.

The annoucment has been welcomed by Food and Drink Federation director of communications, Terry Jones, who said: “We are pleased that the legislation to enable the appointment of a Groceries Code Adjudicator will go forward in this session of Parliament to enforce the already established Groceries Supply Code of Practice. Together these measures will address the abuses of market power identified by the Competition Commission giving businesses especially small and medium sized manufacturers the confidence to innovate and invest which in turn secures choice and availability for the consumer.
“As the Bill proceeds through both Houses, FDF will work to establish trade associations as providers of confidential information on behalf of their members. Small suppliers need to be assured that they will not face retaliation from retailers for using the Code or speaking out about unfair practices.”

However, the British Retail Consortium described the Bill as “worrying” and warned that the legislation would add unecessary bureaucracy and costs for retailers

BRC food director, Andrew Opie, said: “It’s in retailers’ own interests to have excellent relationships with their suppliers. They depend on a successful and resilient supply chain to keep their shelves stocked with the produce consumers want to buy. The UK already has the most regulated supply chain in the world, giving legal protection for suppliers to the biggest retailers through the Groceries Supply Code of Practice, which includes the right to independent arbitration.

“The proposed adjudicator is in danger of adding to the cost and bureaucracy of running a grocery business without adding to the strong protection which already exists for suppliers. The Government’s initial estimate put running costs at just £1million a year, a figure the BIS select committee said was unrealistic. The truth is no-one knows what the cost might be. Retailers are being asked to write a blank cheque.”

Opie added that the government should ensure that the Bill is “as simple and fair as possible” and ensure that the adjudicator can only pursue specific complaints from suppliers.

>BRC launches last stand against GCA
>Industry gives evidence on Groceries Code Adjudicator
>BIS calls for GCA to have greater teeth