Gill: Supermarket code too vague

28 March 2001

Gill: Supermarket code too vague

By FWi staff

FARMERS representatives have pledged to fight for substantial changes to a draft code to regulate relationships with supermarkets.

The Code of Practice drawn up by the Competition Commission is weak and ambiguous, claims the National Farmers Union.

Last autumn, the competition watchdog said retailers/suppliers relations distorted the market and recommended a legally binding code of practice.

Details of the draft code were leaked to Friends of the Earth earlier this month, which said its contents had been watered down.

Responding to consultation on the document, NFU President Ben Gill said too many elements were open to interpretation by supermarkets.

“This code is not as robust a document as we believe is justified,” said Mr Gill. “It is littered with problems, both generic and specific.”

“This draft document will need further work before it represents a fair balance in bargaining power between farmers and supermarkets.

“We shall be fighting for substantial changes to large areas of it.”

The term “reasonable” is stated throughout the code, but without any definition, complained Mr Gill.

And the code will only apply to the top five supermarkets, which the NFU fears will leave farmers and growers supplying smaller retailers vulnerable.

The code does not tackle supermarkets demanding contributions from suppliers towards marketing or buyers visits, said Mr Gill.

Nor does it address the issue of supermarkets forcing growers to pay compensation for low profits, nor wastage incurred at stores, he said.

The NFU had pushed for a code of practice after complaints from farmers and growers that they were threatened by unreasonable supermarket contracts.

On balance, last years commission report cleared the supermarkets of excessive profiteering, concluding they were “broadly competitive”.

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