Retail watchdog gets power to fine
A supermarket adjudicator will have the power to fine big retailers who treat suppliers unfairly, the government has announced.
Competition minister Jo Swinson announced the new power on Tuesday (4 December).
The government had listened to concerns from stakeholders to give the adjudicator more teeth to protect suppliers from unfair treatment, she said.
If the adjudicator finds that retailers are breaching the groceries code and treating their suppliers unlawfully or unfairly, he or she will be able to apply a range of sanctions.
In most cases, this would consist of recommendations or “naming and shaming” but, if the breach is serious enough, the adjudicator will have an immediate power to fine the retailer.
Ms Swinson said: “The food industry plays an important role in economic growth, and the groceries code adjudicator will help to ensure that the market is operating in a fair and healthy way.
Large supermarkets form a big chunk of this industry, and generally provided consumers with low prices and variety while providing business for farmers and suppliers, she added.
“But where supermarkets are breaking the rules with suppliers and treating them unfairly, the adjudicator will make sure that they are held to account.
“The food industry plays an important role in economic growth, and the groceries code adjudicator will help to ensure that the market is operating in a fair and healthy way.”
Competition minister Jo Swinson
“We have heard the views of the stakeholders who were keen to give the adjudicator a power to fine, and recognise that this change would give the adjudicator more teeth to enforce the groceries code.
“We expect fines to be used as a last resort, but the fact that the adjudicator has the power to impose them will send a strong message to retailers that compliance with the code is not optional.
I am confident that these changes will mean that the adjudicator is able to ensure fair play in the food supply chain and keep the industry growing.”
The adjudicator will publish guidance within six months after the bill comes into effect to propose the maximum amount he or she will be able to fine.
Retailers would have a full right of appeal against any fines imposed.
The long-awaited adjudicator is being established to enforce the groceries code after the Competition Commission identified competition issues in 2008.
The adjudicator will be able to arbitrate disputes and investigate confidential complaints from direct and indirect suppliers – and from third parties.
It is being set up through the Groceries Code Adjudicator Bill which is passing through Parliament.
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