Earlier this year, the Irish Government announced imminent plans to publish legislation providing for a statutory code of conduct to regulate the retail sector and eliminate practices such as the use of ‘hello money’.
The legislative basis for a code of conduct is expected to be included in the Consumer and Competition Bill which, according to the Government Legislative Programme, is due to be published before the Government Easter break. The introduction of a code has been a long time in the offing. Draft codes were published in 2009 and 2011 and public consultations were launched, but no final position was reached.
The code of conduct itself is likely to be promulgated by ministerial regulation and is expected to provide for the appointment of an ombudsman to arbitrate disputes between consumers, retailers and suppliers; a prohibition on the use of so-called ‘hello money’ in the industry; and greater transparency in food labelling in light of the recent horsemeat scandal.
A code of conduct has been in place in the UK since 2010, where an adjudicator appointed to investigate alleged breaches of the code has power to fine retailers found to be in breach of its provisions.
The proposed Irish legislation will be widely welcomed by farmers and suppliers who have been calling for a code of practice and an ombudsman for the sector for several years. Many retailers, however, argue that a statutory code will result in retailers sourcing more of their stock overseas, extra costs being imposed, and jobs in the retail and wholesale sectors being lost. They also claim there is a risk that new rules and regulations will act as barriers to new suppliers entering the market.
It is clear that the Minister for Jobs, Enterprise and Innovation will face a delicate balancing exercise in marrying the competing interests of the retailers, suppliers and consumers within the parameters of the new code.