Big retailers take on ACCC over code

The big retailers have lodged some concerns with Treasury over the interpretation of the proposed grocery industry code.

The big retailers have lodged some concerns with Treasury over the interpretation of the proposed grocery industry code.

The concerns, which are backed by the Food and Grocery Council (AFGC), are not so much the words in the proposed regulations but in a discussion paper on the changes.

Coles and Woolies worry the code agreed to with suppliers back in November last year will be interpreted too strictly, not allowing freedom for side deals.

The issue will be discussed at next week’s AFGC industry leaders forum in Canberra which will host an all star cast from government, potentially from the prime minister down.

Small Business Minister Bruce Billson will address the Parliament House forum along with ACCC boss Rod Sims and competition policy chair Ian Harper.

The industry message to the government is if you want more industry codes then you should stick to the term of the agreements reached between the parties.

The draft Harper review flagged more industry codes as a way to manage disputes.

The ACCC only wants agreements which actually mean something rather than just a set of words which can be easily sidestepped.

This is where the dispute lies.

The draft legislation was released for comment and the government aims to have the final legislation in place by calender-year end.

The AFGC leadership includes Simplot boss Terry O’Brien, Nestle’s Trevor Clayton, Unilever’s Clive Stiff and Madura’s Barry Cosier.

Woolies and Coles are the only supermarket chains to have signed the code and they are pushing to keep it voluntary, hoping to avoid the mandatory code favoured by the ACCC.

In their response, the AFGC and retailers noted the consultation paper raises the issue of “contracting out” of the code.

The supermarkets want to maintain flexibility while the ACCC is looking for a more binding agreement.

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