The Grocery Supply Code of Practice came into force on 4 February 2010 through The Groceries (Supply Chain Practices) Market Investigation Order 2009 (GSCOP). The GSCOP Order requires "Designated Retailers" (which generate more than £1 billion of grocery sales in the UK and which are listed in the Order) to comply with the GSCOP in their contracts with grocery suppliers.
The GSCOP will be enforced through a body whose identity and powers will be determined following a consultation process that is led by the UK Department for Business, Innovation and Skills (BIS). This consultation is relevant to Designated Retailers and those businesses that supply Designated Retailers with grocery produce, either directly or through intermediaries. Trade associations and other non-Government organisations may also have an interest.
The consultation will run until 30th April 2010 and will cover the following areas:
- Who the body should be. The Competition Commission prefers an independent Ombudsman to assume the role of enforcement of the GSCOP and, if not accepted, the Office of Fair Trading should assume monitoring and enforcement of it.
- What the body should do. The Competition Commission has proposed a number of duties for this body, including:
- in relation to GSCOP breaches, receive complaints and investigate them where necessary
- in relation to disputes arising under the GSCOP, acting as an arbitrator between Designated Retailers and suppliers
- advise and report publicly on the operation of the GSCOP and the enforcement scheme (including details of resolved disputes and investigations undertaken)
- preparing, leading consultation on and publishing guidance on the GSCOP
- recommending ways Designated Retailers can improve compliance with GSCOP as well as monitoring implementation of recommendations
- How GSCOP funding should be raised. The Competition Commission has estimated that £3 million will be needed each year to support the GSCOP and its enforcement.
- Penalties for breach of GSCOP. The BIS will consult on whether or not penalties for breach of the GSCOP should arise and, if so, the appropriate quantum and method for levying them on errant Designated Retailers.
- Who should be excluded from enforcement efforts. The BIS will consider whether to limit coverage of the body to smaller suppliers with little or no brand power or whether to ensure all suppliers are allowed access. BIS notes that as all suppliers are covered by GSCOP it would be difficult to justify an enforcement body which did not consider all cases no matter who the supplier.
Responses to this Consultation should be sent NO LATER THAN 30 APRIL 2010:
- by email to GSCOPmonitoringbody@bis.gsi.gov.uk or
- by post to Steve Smith, Consumer and Competition Policy, Department for Business, Innovation and Skills, 1 Victoria Street, London, SW1H 0ET.
A Consultation document "Taking forward the establishment of a body to monitor and enforce compliance with the groceries supply code of practice (GSCOP)" is available to download.