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Majors clarify code with suppliers after ACCC voices concerns

The Australian Competition and Consumer Commission (ACCC) says Coles, Woolworths, and Aldi have contacted suppliers clarifying the implementation of the Food and Grocery Code of Conduct following earlier concerns raised by the watchdog as to how they were presenting agreements.

According to the ACCC, Woolworths and Aldi have written to their suppliers clarifying that they are able to negotiate the terms of their Grocery Supply Agreements (GSAs). They have also reportedly clarified the effect of the code on their GSAs and the circumstances in which certain payments may arise. Coles is understood to have explained to suppliers how the supermarket is implementing the requirements under the code and clarified that it is prepared to negotiate GSA terms.

The move by the supermarket retailers followed claims by the ACCC that it had received reports some supermarkets were presenting GSAs in a manner which implied that they were non-negotiable. Introduced earlier this year, the code has been signed by Aldi, Coles, Woolworths, and Sydney-based retailer, About Life. The code is yet to be signed by Metcash, which operates IGA, Supa IGA, and South Australia-based Foodland.

“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

“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.”

“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 said.

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

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