Strengthening the Food and Grocery Code to get a fair go for families and farmers

Australian Treasury

The Albanese Government will strengthen the Food and Grocery Code of Conduct, accepting all recommendations of a recent independent review into the Code as part of a wide‑ranging cost‑of‑living crackdown on anti‑competitive behaviour in the food and grocery sector.

This is about getting a fair go for families and a fair go for farmers.

Our efforts will help to ensure our supermarkets are as competitive as they can be so Australians get the best prices possible.

We’re cracking down on anti‑competitive behaviour in the supermarkets sector so people get fairer prices at the checkout.

We commissioned Dr Craig Emerson to review the Food and Grocery Code of Conduct to ensure it’s protecting suppliers and encouraging a competitive grocery sector that delivers a fair deal for Australians.

The Review found that the current voluntary Code is failing to address the imbalance of bargaining power between supermarkets and their suppliers, including farmers.

Suppliers fear retribution from supermarkets if they raise concerns or exercise their rights under the Code.

Following extensive stakeholder engagement, the Review’s recommendations to be implemented in full by the Government include:

  • Making the Code mandatory for all supermarkets with an annual Australian revenue of greater than $5 billion
  • Strengthening formal and informal dispute‑resolution arrangements
  • Introducing penalties for the more harmful breaches of the Code with the maximum penalty the greatest of $10 million, three times the benefit gained from the contravening conduct or 10 per cent of turnover in the preceding 12 months.
  • Creating an anonymous supplier and whistle‑blower complaints mechanism within the Australian Competition and Consumer Commission
  • Placing greater emphasis on addressing fear of retribution
  • Improving outcomes for suppliers of fresh produce

Implementing these recommendations will require changes to regulations and the Competition and Consumer Act 2010, which the Government will prioritise.

A copy of the final report and Government response is available on the Treasury website.

We thank Craig Emerson for his efforts in reviewing the Food and Grocery Code and for his recommendations which the government will adopt in full.

This Review is an important part of the Albanese Government’s broad competition reform agenda, which includes an ACCC inquiry into supermarket prices, funding for CHOICE to conduct quarterly price monitoring reports (the first of which was released on Thursday), and progressing legislation to implement the biggest change to our merger reform system in almost 50 years.

Our Budget and our economic plan is all about easing the cost of living for Australians and improving competition in the supermarkets sector is an important part of that agenda.

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