Aldi joins grocery code

aldiDiscount supermarket chain, Aldi, has become one of the first supermarket retailers to sign the  Federal Government’s new Food and Grocery Code of Conduct.

The voluntary code, which comes into effect from today, prohibits specific types of unfair conduct by retailers and wholesalers in their dealings with suppliers and provides a clearer framework for these dealings.

It complements existing protections for suppliers under the Competition and Consumer Act 2010, including the unconscionable conduct provisions.

“Aldi Australia has always supported the principle of a strong and sustainable Australian grocery industry for both suppliers and retailers, with an emphasis on fairness throughout all business dealings,” an Aldi spokesperson said.

“The provisions of the code reflect Aldi’s current practice with suppliers: forging long term, stable, sustainable relationships and working closely in partnership to provide Australian shoppers with high quality products at permanently low prices.”

Small Business Minister, Bruce Billson, said the new code will improve commercial relationships throughout the entire supply chain of Australia’s grocery sector.

“This is about transparency. This is about openness and predictability for suppliers in dealing with the supermarket chains,” Billson said.

The code applies to retailers and wholesalers, and features an obligation to enter into grocery supply agreements in writing; minimum standards of behaviour in dealings with suppliers, including an obligation to act in ‘good faith’ and a prohibition against threatening suppliers with business disruption or termination without reasonable grounds; and  dispute resolution mechanisms to assist suppliers in resolving disputes.

The Australian Food and Grocery Council said the code is “an historic step towards levelling the playing field for food and grocery suppliers in their transactions with the major supermarkets”.

AFGC CEO, Gary Dawson, said the move was integral to achieving a meaningful and enforceable code that will drive behavioural change to encourage fair and effective competition in the long term interests of consumers.

“Signing onto the code will be a mark of the retailers commitment to fair dealing and to improving the operation of one of the most dynamic and competitive sectors of the economy – the fast moving consumer goods sector,” Dawson said.

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