The decision to give The Groceries Code Adjudicator the power to fine retailers and their direct suppliers for unfair trading practices is a positive step toward ensuring malpractice is eradicated from this part of the supply chain, says the NFU. These powers include the ability to fine up to a permitted maximum of 1% turnover – something that the NFU has been lobbying on for over a decade.
However, the NFU has warned that more needs to be done to protect those farmers and growers not covered within the remit of the Grocery Code. These individuals are not direct suppliers to retailers and, therefore, still not protected from unfair trading practices from intermediaries.
The delegated legislation was laid before Parliament in the form of a Statutory Instrument to the Groceries Code Adjudicator Act 2013. It follows on from the Prime Minister’s promise to push it through in response to a question on dairy from NFU member Glyn Davies, Conservative MP for Montgomeryshire, during Prime Minister’s questions on January 21 2015. After debate in both Houses of Parliament, it is due to come into force on 6th April 2015.
NFU food chain adviser Tom Lander said: “Like any professional business owner, farmers want to operate in a transparent and fair market place. This can only occur in a trading environment governed by fair rules and procedures that address imbalances of power in the supply chain.
“While this is good news for those with a direct relationship with retailers, conversations must now begin on how the Grocery Code can be extended further up the supply chain. We need to ensure more farmers are protected from unfair trading practices, which strip value out of the supply chain, affecting both producers and consumers.”