Major changes to the way in which governments regulate grocery retailers in two of Europe’s largest markets come into force this month, with significant developments scheduled to take place in both the UK and Russia.
The UK government announced last month it was appointing a supermarket ombudsman to enforce its new Groceries Supply Code of Practice (GSCOP), which is designed to protect suppliers from exploitation by large grocery retailers.
In a statement, UK consumer minister Kevin Brennan said the government had accepted the recommendations of its own Competition Commission to appoint an ombudsman to oversee the new code, which comes into force on 4 February 2010.
The minister said the implementation of the code would be “quickly followed” by a consultation, beginning in February, on how best to enforce the GSCOP, including who that body might be and the powers it could have. “The revised Grocery Supply Code of Practice is a great improvement on the current regime,” Mr Brennan said.
The move is being seen as an attempt to address the power that large grocery retailers remain able to wield over suppliers, which can put pressure on small producers and ultimately harm consumers, he added. “Free and fair competition is the key to a healthy market and it is right that there should be an enforcement body to make sure that consumers are getting value for money.”
In Russia, meanwhile, a new trade law due to take effect from the start of February sets out more precisely the kind of contracts retailers may sign with their suppliers, with potentially far-reaching consequences for the fresh produce trade: payments for goods with a shelf-life of less than 10 days, for example, must now be completed within 10 working days of receiving the consignment; if the shelf-life is between 10 and 30 days, payment must be closed within 30 days.
Retail operators still have six months from 1 February in which to renegotiate contracts with their suppliers based on the new rules, but for major suppliers to the Russian market in the second half of the year – notably European topfruit suppliers – the new regulations are likely to be of great interest.
Registrations for the upcoming FRESH2010 congress in St Petersburg, Russia, are now open – to register for the event, visit www.freshcongress.com
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