The Groceries Code will expand to cover new retailers Ocado and B&M Homestores according to the Competition and Market Authority (CMA).
The CMA expanded coverage of the Code after Ocado and B&M passed £1 billion turnover this year, meaning they will now have to follow supplier to retailer relationship guidelines. Retailers bound by the Code cannot make changes to the terms of supply retrospectively and must provide notice of and reasons for no longer using a supplier, for example.
The GCA was given greater powers in 2015 to impose penalties on retailers who break the Code, with current adjudicator Christine Tacon able to fine supermarkets 1 per cent of their turnover.
In the face of increasing retail consolidation, NFU food chain adviser Christine McDowell said the CMA’s decision shows they are serious about protecting fair practise, but described it as a “missed opportunity” to cover other retailers not under the Code.
McDowell said:“The NFU has lobbied hard over the past few years for the Competition and Markets Authority to extend the remit of the Groceries Supply Code of Practice (GSCOP) and we are pleased to see that Ocado and B&M Homestores are now bound by rules on treating suppliers fairly. Widening the scope of GSCOP does send a clear message that the CMA is serious about ensuring fair and lawful practice. But we think this is a missed opportunity to include other retailers under this remit.
“GSCOP and the role of the Grocery Code Adjudicator, Christine Tacon, have done a good job in working with retailers to give more protection to businesses from unfair trading practices. The recent GCA survey showed that retailers have improved their buying behaviour in recent years but there are still improvements to be made, particularly on areas such as delays in payments.
“The NFU holds GSCOP training, at a discounted rate, for members supplying directly to the designated retailers. We would encourage all members to be trained in GSCOP in order to ensure they are aware of aware of how the GCA can protect their business from any unfair trading.”
