The Groceries Code

The Groceries Code Adjudicator (GCA) has launched the third annual review of the sector. The objective of the survey is to collect a comprehensive set of views on current Code-related issues facing suppliers.

The survey closes on 29 April with the results scheduled to be announced at the GCA’s annual conference on 27 June. The survey can be accessed here.

Publication of the survey follows closely in the wake of publication of the GCA’s report of the investigation into Tesco, where the GCA found Tesco to be in breach of the Code provision relating to delay in payments (although not in respect of the provision concerning the better positioning of goods). We reviewed the GCA’s findings and recommendations in this briefing.

Product recalls

The announcement that Mars recently launched an international recall of its chocolate bars is a reminder of the importance of being prepared for a product recall.

The recall affected 55 countries and was implemented following the discovery of a piece of plastic in a Snickers bar in Germany.

The costs consequences of the recall are likely to be enormous – loss of sales, the logistics of removing the product from the supply chain, reimbursing aggrieved customers, not to mention the PR and legal costs. However, the reputational damage that may flow from mismanaging a product recall could dwarf even these costs.

Food and drink businesses can help to protect themselves by:

  • having a “crisis management” team ready to deal with the fall-out from the event. This should include lawyers and PR management specialists, each with clearly defined roles and reporting lines
  • collecting relevant documentation, such as agreements with suppliers
  • preserving evidence which may be needed both in bringing or defending any claim
  • ensuring, where possible, that communications and internal investigations are protected by legal privilege – which may mean involving lawyers straight away
  • understanding the legal framework for the bringing of compensation claims, both domestically and overseas.

An illustration of how a crisis management plan should work was provided in March by Tesco, which took prompt and effective action to withdraw flavoured butters from the supply chain that it feared may be contaminated with Listeria monocytogenes.

Food labelling

On 22 March, the European Parliament’s Environment and Public Health Committee reiterated its demand for binding EU rules on country of origin labelling of meat (other than bovine, porcine, ovine, caprine species and poultry meat, which are already covered), for milk and milk used as an ingredient in dairy products, for unprocessed foods, single-ingredient products and for ingredients that make up more than 50 per cent of a food. The Committee’s view is that the operating costs of making country of origin labelling mandatory would be relatively minor and that voluntary labelling, which is the approach the European Commission favours, might lead to a variety of different schemes, which would be confusing to consumers. Any legislation, if it happens, is still a long way off, but the Committee’s motion is a sign that the issue of origin labelling remains as contentious as ever.