Competition and Consumer (Industry Codes—Food and Grocery) Regulation 2015, Australia, WIPO Lex

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English Competition and Consumer (Industry Codes—Food and Grocery) Regulation 2015

Competition and Consumer (Industry Codes - Food and Grocery) Regulation 2015

OPC60473 - B

Competition and Consumer (Industry

Codes—Food and Grocery)

Regulation 2015

Select Legislative Instrument No. 16, 2015

I, General the Honourable Sir Peter Cosgrove AK MC (Ret’d),

Governor-General of the Commonwealth of Australia, acting with the

advice of the Federal Executive Council, make the following regulation.

Dated 26 February 2015

Peter Cosgrove

Governor-General

By His Excellency’s Command

Bruce Billson

Minister for Small Business

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i Competition and Consumer (Industry Codes—Food and Grocery)

Regulation 2015

No. 16, 2015

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Contents 1 Name .................................................................................................1

2 Commencement.................................................................................1

3 Authority ...........................................................................................1

4 Code of conduct.................................................................................1

5 Review of Code .................................................................................1

Schedule 1—Food and Grocery Code of Conduct 3

Part 1—Preliminary 3 1 Name .................................................................................................3

2 Purpose of code .................................................................................3

3 Definitions.........................................................................................3

4 When this code applies ......................................................................6

5 Transitional application—retailers ....................................................6

6 Transitional application—wholesalers ..............................................7

Part 2—Grocery supply agreements 8 7 Grocery supply agreement must be in writing and retained...............8

8 Matters to be covered by agreement ..................................................8

9 Unilateral variation of agreement ......................................................9

10 Retrospective variation of agreement ................................................9

Part 3—Conduct generally 11

Division 1—Application of this Part 11

11 Application of this Part....................................................................11

Division 2—Paying suppliers 12

12 Payments to suppliers ......................................................................12

Division 3—Requiring payments from suppliers 13

13 Payments for shrinkage ...................................................................13

14 Payments for wastage ......................................................................13

15 Payments as a condition of being a supplier ....................................14

16 Payments for better positioning of groceries ...................................14

17 Payments for retailer’s activities .....................................................15

18 Funding promotions.........................................................................16

Division 4—Other conduct 17

19 Delisting products............................................................................17

20 Funded promotions..........................................................................18

21 Fresh produce standards and quality specifications .........................19

22 Changes to supply chain procedures................................................20

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23 Business disruption..........................................................................20

24 Intellectual property rights...............................................................20

25 Confidential information .................................................................21

26 Allocation of shelf space .................................................................22

27 Transfer of intellectual property rights ............................................22

Part 4—Good faith etc. 24 28 Obligation to deal lawfully and in good faith ..................................24

29 Freedom of association....................................................................24

30 Provision of contact details..............................................................25

Part 5—Dispute resolution 26

Division 1—Preliminary 26

31 Information and documents .............................................................26

32 Code compliance manager...............................................................26

Division 2—Complaints 28

33 Referral of complaints .....................................................................28

34 Immediate elevation of complaint ...................................................28

35 Investigation by code compliance manager .....................................28

36 Action following investigation ........................................................29

37 Internal review.................................................................................30

Division 3—Mediation and arbitration 31

38 Supplier may seek mediation or arbitration .....................................31

39 Conduct of mediation and arbitration ..............................................32

Part 6—Compliance and reporting 34 40 Duty to train staff with respect to this code .....................................34

41 Reports by code compliance managers............................................34

42 Keeping records...............................................................................35

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Section 1

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1 Name

This is the Competition and Consumer (Industry Codes—Food and

Grocery) Regulation 2015.

2 Commencement

This instrument commences on the day after it is registered.

3 Authority

This instrument is made under section 51AE of the Competition

and Consumer Act 2010.

4 Code of conduct

For section 51AE of the Competition and Consumer Act 2010, the

code set out in Schedule 1:

(a) is prescribed; and

(b) is a voluntary industry code.

Note: Only grocery retailers and wholesalers can be bound by the code. For

how a retailer or wholesaler agrees to be bound by the code, and

ceases to be so bound, see clause 4 of the code.

5 Review of Code

(1) The Minister administering section 51AE of the Competition and

Consumer Act 2010 must cause a review to be undertaken of the

operation of the Food and Grocery Code of Conduct (the code).

(2) The review must start before the end of the period of 3 years after

the commencement of this section.

(3) The review must assess the impact of the code in improving

commercial relations between grocery retailers, wholesalers and

suppliers.

(4) The review must address the following:

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Section 5

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(a) the extent to which retailers and wholesalers have become

bound by the code;

(b) levels of compliance with the code by retailers and

wholesalers bound by the code;

are being met;

(d) the extent to which the code assists in addressing any

imbalances in the allocation of risks between retailers,

wholesalers and suppliers;

(e) whether there are any further measures that would improve

the operation of the code with respect to the matters

mentioned in paragraphs (c) and (d);

(f) the interactions between the code and the Horticulture Code

of Conduct;

(g) how the code compares with overseas regulation of

commercial relations between retailers, wholesalers and

suppliers;

(h) whether the code should be mandatory or voluntary;

(i) whether the code should include civil penalty provisions;

(j) whether retailers, wholesalers and suppliers should be bound

by the code, and if so, to what extent;

(k) whether the code should be repealed or amended and, if so,

the timing of any such repeal or amendment;

(l) the products that should be covered by the code.

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Food and Grocery Code of Conduct Schedule 1

Preliminary Part 1

Clause 1

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Schedule 1—Food and Grocery Code of

Conduct Note: See section 4.

Part 1—Preliminary

1 Name

This is the Food and Grocery Code of Conduct.

2 Purpose of code

The purpose of this code is:

(a) to help to regulate standards of business conduct in the

grocery supply chain and to build and sustain trust and

cooperation throughout that chain; and

(b) to ensure transparency and certainty in commercial

transactions in the grocery supply chain and to minimise

disputes arising from a lack of certainty in respect of the

commercial terms agreed between parties; and

process for raising and investigating complaints and

resolving disputes arising between retailers or wholesalers

and suppliers; and

(d) to promote and support good faith in commercial dealings

between retailers, wholesalers and suppliers.

3 Definitions

In this code:

Act means the Competition and Consumer Act 2010.

buying team means the employees of a retailer or wholesaler

whose role includes at least one of the following:

(a) direct involvement in buying grocery products;

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Schedule 1 Food and Grocery Code of Conduct

Part 1 Preliminary

Clause 3

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(b) immediate management responsibility for an employee

covered by paragraph (a).

code compliance manager means a person nominated under

subclause 32(1).

delist means to remove a grocery product from a retailer’s range of

grocery products.

groceries includes the following:

(a) food including fresh produce, meat and dairy items (other

than dairy items sold for in-store consumption);

(b) pet food;

consumption);

(d) cleaning products;

(e) toiletries, perfumes and cosmetics;

(f) household goods, electrical appliances and kitchenware;

(g) clothing;

(h) “do-it-yourself” products;

(i) pharmaceuticals;

(j) books, newspapers, magazines and greeting cards;

(k) CDs, DVDs, videos and audio tapes;

(l) toys;

(m) plants, flowers and gardening equipment;

(n) tobacco and tobacco products.

grocery supply agreement means any agreement between a retailer

or wholesaler and a supplier for the supply of groceries to or for

the purposes of a supermarket business and includes any

document:

(a) comprising the agreement; or

(b) made, from time to time, under the agreement.

own brand product means a grocery product:

(a) produced, processed or manufactured by a retailer; or

(b) produced, processed or manufactured for a retailer (including

by a supplier); or

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Food and Grocery Code of Conduct Schedule 1

Preliminary Part 1

Clause 3

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retailer.

promotion means any offer for sale (whether or not accompanied

by some other benefit to a consumer):

(a) at an introductory or reduced price, or involving

non-standard sales activity; and

(b) as agreed between a retailer and a supplier; and

retailer means a corporation:

(a) to the extent that it carries on a supermarket business in

Australia for the retail supply of groceries; and

(b) to the extent that it carries on a business of purchasing

groceries from suppliers for the purpose of resale to a person

carrying on a supermarket business in Australia for the retail

supply of groceries.

senior buyer, in relation to a supplier, means the employee within

a retailer or wholesaler’s buying team who manages the buyers

who buy from the supplier.

shrinkage means a loss of grocery products that:

(a) occurs after a retailer has taken possession of them; and

(b) arises from theft, other loss or accounting error.

supermarket business means a business under which a person sells

to consumers bread, breakfast cereal, butter, eggs, flour, fresh fruit

and vegetables, fresh milk, meat, rice, sugar and other packaged

food or most of those groceries.

supplier means a person carrying on (or actively seeking to carry

on) a business of supplying groceries for retail sale by another

person.

wastage means groceries that are unfit for sale.

wholesaler means a corporation to the extent that it carries on a

business of purchasing groceries from suppliers for the purpose of

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Schedule 1 Food and Grocery Code of Conduct

Part 1 Preliminary

Clause 4

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resale to a person carrying on a supermarket business in Australia

for the retail supply of groceries.

4 When this code applies

(1) This code binds a corporation as a retailer if the corporation has

agreed, by written notice given to the Commission, to be bound by

this code as a retailer.

(2) This code binds a corporation as a wholesaler if the corporation has

agreed, by written notice given to the Commission, to be bound by

this code as a wholesaler.

Note 1: Part 3 of this code does not apply to a corporation that is bound by this

code as a wholesaler: see clause 11.

Note 2: Clauses 5 and 6 provide transitional arrangements in relation to

grocery supply agreements entered into by retailers and wholesalers

before being bound by this code.

(3) The corporation ceases to be bound by this code if the corporation,

by written notice given to the Commission, withdraws the

agreement.

(4) This code does not apply to the extent that it conflicts with:

(a) the Horticulture Code of Conduct; or

(b) the Franchising Code of Conduct.

(5) To avoid doubt, withdrawing agreement to be bound by this code

does not remove any obligation under this code that relates to

conduct that occurred when the corporation was so bound.

5 Transitional application—retailers

(1) This clause applies if a retailer is a party to a grocery supply

agreement entered into before the retailer was bound by this code.

(2) Within 6 months after being bound by this code, the retailer must

offer in writing to vary the agreement so that it conforms with the

requirements of this code in relation to making grocery supply

agreements.

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Food and Grocery Code of Conduct Schedule 1

Preliminary Part 1

Clause 6

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(3) If the supplier concerned accepts the offer, the retailer must so vary

the agreement within 6 months after the offer is accepted.

(4) Parts 2, 3, 5 and 6 of this code do not apply in relation to the

supply of groceries under the agreement until one of the following

occurs:

(a) the agreement is varied under subclause (3);

(b) the period of 12 months that begins when the retailer is

bound by the code ends.

6 Transitional application—wholesalers

(1) This clause applies if a wholesaler is a party to a grocery supply

agreement entered into before the wholesaler was bound by this

code.

(2) Within 18 months after being bound by this code, the wholesaler

must offer in writing to vary the agreement so that it conforms with

the requirements of this code in relation to making grocery supply

agreements.

(3) If the supplier concerned accepts the offer, the wholesaler must so

vary the agreement within 6 months after the offer is accepted.

(4) Parts 2, 5 and 6 of this code do not apply in relation to the supply

of groceries under the agreement until one of the following occurs:

(a) the agreement is varied under subclause (3);

(b) the period of 24 months that begins when the wholesaler is

bound by the code ends.

Federal Register of Legislative Instruments F2015L00242

Schedule 1 Food and Grocery Code of Conduct

Part 2 Grocery supply agreements

Clause 7

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Part 2—Grocery supply agreements

7 Grocery supply agreement must be in writing and retained

The retailer or wholesaler must not enter into a grocery supply

agreement unless it is in writing.

Note: The retailer or wholesaler must keep the original or a copy of each

grocery supply agreement to which the retailer or wholesaler is a party

while bound by this code (including any document comprising the

agreement, and any document made from time to time under the

agreement that forms part of the agreement):

(a) during the term of the agreement; and

(b) for 6 years after the agreement ends.

See subclause 42(1).

8 Matters to be covered by agreement

The retailer or wholesaler must not enter into a grocery supply

agreement unless the agreement specifies the following:

(a) any requirements the retailer or wholesaler has in respect of

the delivery of the groceries;

(b) any circumstances in which the retailer or wholesaler may

reject the groceries;

the supplier for the groceries and the circumstances in which

any payment, or part of a payment, may be withheld or

delayed;

(d) if the agreement is intended to operate for a limited time

only—the term of the agreement;

(e) in clear terms, any quantity and quality requirements relating

to the groceries;

(f) if the agreement provides for termination by one or more

parties to it—the circumstances in which it may be

terminated.

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Food and Grocery Code of Conduct Schedule 1

Grocery supply agreements Part 2

Clause 9

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9 Unilateral variation of agreement

(1) The retailer or wholesaler must not vary a grocery supply

agreement without the consent of the supplier concerned.

(2) Subclause (1) does not apply if:

(a) the agreement:

(i) provides expressly for the retailer or wholesaler to make

the variation; and

(ii) sets out clearly the changed circumstances in which the

variation can be made; and

(iii) if the variation involves a quantitative adjustment to the

terms of supply—sets out the basis or methodology for

calculating the adjustment; and

(b) the variation is made in accordance with the agreement; and

(d) the supplier is given reasonable notice, in writing, of:

(i) the variation; and

(ii) the terms of the variation; and

(iii) the retailer or wholesaler’s reasons for making the

variation.

(3) In determining whether the variation is reasonable in the

circumstances, regard must be had to the benefits, costs and risks

(if any) for the supplier and retailer or wholesaler.

(4) Subclause (3) does not limit paragraph (2)(c).

(5) In any dispute, the retailer or wholesaler has the onus of

establishing the matters in subclause (2).

(6) In any dispute in relation to a contravention of subclause (1), a

person alleging detriment to a supplier in relation to

paragraph (2)(c) has the onus of establishing that detriment.

10 Retrospective variation of agreement

(1) The retailer or wholesaler must not vary a grocery supply

agreement with retrospective effect.

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Schedule 1 Food and Grocery Code of Conduct

Part 2 Grocery supply agreements

Clause 10

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(2) Subclause (1) does not apply if:

(a) the agreement:

(i) provides expressly for the retailer or wholesaler to make

the variation; and

(ii) sets out clearly the changed circumstances, which must

be circumstances beyond the control of the retailer or

wholesaler, in which the variation can be made; and

(iii) if the variation involves a quantitative adjustment to the

terms of supply—sets out the basis or methodology for

calculating the adjustment; and

(b) the variation is made in accordance with the agreement; and

(d) the supplier is given reasonable notice, in writing, of:

(i) the variation; and

(ii) the terms of the variation; and

(iii) the retailer or wholesaler’s reasons for making the

variation.

(3) In determining whether the variation is reasonable in the

circumstances, regard must be had to the benefits, costs and risks

(if any) for the supplier and retailer or wholesaler.

(4) Subclause (3) does not limit paragraph (2)(c).

(5) In any dispute, the retailer or wholesaler has the onus of

establishing the matters in subclause (2).

(6) In any dispute in relation to a contravention of subclause (1), a

person alleging detriment to a supplier in relation to

paragraph (2)(c) has the onus of establishing that detriment.

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Food and Grocery Code of Conduct Schedule 1

Conduct generally Part 3

Application of this Part Division 1

Clause 11

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Part 3—Conduct generally

Division 1—Application of this Part

11 Application of this Part

This Part does not apply to a corporation that is bound by this code

as a wholesaler.

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Schedule 1 Food and Grocery Code of Conduct

Part 3 Conduct generally

Division 2 Paying suppliers

Clause 12

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Division 2—Paying suppliers

12 Payments to suppliers

(1) The retailer must pay a supplier for all grocery products delivered

and accepted in accordance with a grocery supply agreement:

(a) within the time frame set out in the agreement; and

(b) in any case—within a reasonable time after receiving the

supplier’s invoice for the products.

(2) The retailer must not:

(a) set off any amount against a supplier’s invoice or remittance

unless the supplier has consented in writing to the set-off of

the amount; or

(b) require a supplier to consent to set off such an amount.

(3) Subclause (2) does not apply if:

(a) the grocery supply agreement provides for the amount to be

set off; and

(b) the set-off is reasonable in the circumstances.

(4) In any dispute, the retailer has the onus of establishing the matters

in subclause (3).

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Food and Grocery Code of Conduct Schedule 1

Conduct generally Part 3

Requiring payments from suppliers Division 3

Clause 13

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Division 3—Requiring payments from suppliers

13 Payments for shrinkage

(1) The retailer must not:

(a) enter into a grocery supply agreement under which a supplier

is required to make payments as compensation for shrinkage;

(b) otherwise require such payments.

(2) Subclause (1) does not prevent the retailer from raising, discussing

or agreeing with a supplier proposals and procedures to mitigate

the risk and occurrence of shrinkage.

14 Payments for wastage

(1) The retailer must not directly or indirectly require a supplier to

make any payment to cover any wastage of groceries incurred at

premises of the retailer or its contractors or agents or another

retailer.

(2) Subclause (1) does not apply if:

(a) the relevant grocery supply agreement sets out expressly and

unambiguously the circumstances, which could include

negligence, in which the supplier will be required to make

payments to cover wastage of the supplier’s groceries

incurred at premises of the retailer or its contractor or agents;

and

(b) the wastage occurs in such circumstances; and

agreement; and

(d) the payment is reasonable having regard to the retailer’s costs

incurred by the wastage; and

(e) the retailer takes reasonable steps to mitigate those costs.

(3) In any dispute, the retailer has the onus of establishing the matters

in subclause (2).

Federal Register of Legislative Instruments F2015L00242

Schedule 1 Food and Grocery Code of Conduct

Part 3 Conduct generally

Division 3 Requiring payments from suppliers

Clause 15

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15 Payments as a condition of being a supplier

(1) The retailer must not require a supplier to make any payment as a

condition of stocking or listing grocery products.

(2) Subclause (1) does not apply if:

(a) the payment is made in relation to a promotion; or

(b) the payment:

(i) is required under the relevant grocery supply agreement;

and

(ii) is made in respect of groceries that have not been

stocked, displayed or listed by the retailer during the

preceding 365 days in 25% or more of its stores; and

(iii) is reasonable having regard to the costs and risks to the

retailer in stocking, displaying or listing the grocery

products.

(3) Paragraph (2)(a) has effect subject to clause 18 (funding

promotions).

(4) In any dispute, the retailer has the onus of establishing the matters

in subclause (2).

16 Payments for better positioning of groceries

(1) The retailer must not require a supplier to make any payment to

secure either of the following for a grocery product:

(a) better positioning;

(b) an increase in allocation of shelf space.

(2) Subclause (1) does not apply if:

(a) the payment is required under the relevant grocery supply

agreement; and

(b) the agreement sets out the particular circumstances in which

the payment may be required; and

the following:

(i) the additional benefits (if any) to the supplier;

Federal Register of Legislative Instruments F2015L00242

Food and Grocery Code of Conduct Schedule 1

Conduct generally Part 3

Requiring payments from suppliers Division 3

Clause 17

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(ii) the costs and risks to the retailer of allocating additional

or different shelf space.

Note: For example, a grocery supply agreement may provide for a supplier

to make a payment in relation to the promotion of the supplier’s

product.

(3) In any dispute, the retailer has the onus of establishing the matters

in subclause (2).

17 Payments for retailer’s activities

(1) The retailer must not directly or indirectly require a supplier to

make any payment towards the costs of any of the following (the

retailer’s activities):

(a) a buyer’s visit to the supplier;

(b) artwork or packaging design;

(d) the opening or refurbishing of a store;

(e) hospitality for the retailer’s staff.

(2) Subclause (1) does not apply if:

(a) the relevant grocery supply agreement provides for the

payment; and

(b) the payment is reasonable in the circumstances.

(3) In determining whether the payment is reasonable in the

circumstances, regard must be had to the following:

(a) the likely benefits to the supplier from the retailer’s

activities;

(b) the likely benefits to the retailer from the retailer’s activities;

retailer’s activities.

(4) Subclause (3) does not limit paragraph (2)(b).

(5) In any dispute, the retailer has the onus of establishing the matters

in subclause (2).

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Schedule 1 Food and Grocery Code of Conduct

Part 3 Conduct generally

Division 3 Requiring payments from suppliers

Clause 18

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18 Funding promotions

(1) The retailer must not directly or indirectly require a supplier to

fund part or all of the costs of a promotion.

(2) Subclause (1) does not apply if:

(a) the relevant grocery supply agreement provides for the

funding; and

(b) the funding is reasonable in the circumstances.

(3) In determining whether the funding is reasonable in the

circumstances, regard must be had to the following:

(a) the likely benefits to the supplier from the promotion;

(b) the likely benefits to the retailer from the promotion;

promotion.

(4) Subclause (3) does not limit paragraph (2)(b).

(5) In any dispute, the retailer has the onus of establishing the matters

in subclause (2).

Federal Register of Legislative Instruments F2015L00242

Food and Grocery Code of Conduct Schedule 1

Conduct generally Part 3

Other conduct Division 4

Clause 19

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Division 4—Other conduct

19 Delisting products

(1) The retailer may only delist a supplier’s grocery product:

(a) in accordance with the terms of the relevant grocery supply

agreement; and

(b) for genuine commercial reasons.

(2) For the purpose of subclause (1), genuine commercial reasons for

delisting a product include the following:

(a) failure of the supplier to meet agreed quality or quantity

requirements with respect to the product;

(b) failure of the supplier’s product to meet the retailer’s

commercial sales or profitability targets as notified to the

supplier in, or in accordance with, the grocery supply

agreement;

as notified to the supplier from time to time in accordance

with the grocery supply agreement.

(3) Subclause (2) does not limit subclause (1).

(4) To avoid doubt, delisting as a punishment for a complaint, concern

or dispute raised by a supplier is not a genuine commercial reason.

(5) Prior to delisting a supplier’s grocery product, the retailer must:

(a) provide reasonable written notice to the supplier of the

retailer’s decision to delist the product, including the reasons

for delisting; and

(b) inform the supplier of the supplier’s right to have the

decision to delist the product reviewed by the retailer’s senior

buyer for the supplier.

(6) Subclause (5) does not apply if:

(a) time is of the essence (including for product recalls,

withdrawals or safety issues); or

Federal Register of Legislative Instruments F2015L00242

Schedule 1 Food and Grocery Code of Conduct

Part 3 Conduct generally

Division 4 Other conduct

Clause 20

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(b) there are persistent issues with supply that have resulted in

the retailer being out of stock or stocked at significantly

reduced levels.

(7) The retailer’s senior buyer for a supplier must, after receiving a

written request from the supplier, promptly review any decisions

regarding delisting made by the retailer and provide the supplier

with written notice of the outcome of that review including the

basis for the retailer’s decision.

(8) To avoid doubt, a decision by the retailer not to extend the

agreement, or enter into a new grocery supply agreement,

following the expiry of a fixed term grocery supply agreement is

not a decision to delist a product.

(9) In any dispute, the retailer has the onus of establishing the matters

in subclauses (1) and (6).

20 Funded promotions

(1) If a supplier agrees to make a payment in support of the promotion

of a product, the retailer may hold the promotion only after giving

the supplier reasonable written notice.

(2) If the retailer orders a grocery product from a supplier at a

promotional price (whether calculated by way of discount, rebate,

credit, allowance or otherwise), the retailer must:

(a) ensure that the basis on which the quantity of the order is

calculated is transparent; and

(b) not over-order; and

below, the promotional resale price—pay the supplier the

difference between the supplier’s promotional price and the

supplier’s full price for the product.

(3) If the retailer has placed an order for a grocery product with a

supplier in connection with a promotion, the retailer must not do

either of the following without the supplier’s written consent:

(a) cancel the order;

(b) reduce the order by more than 10%.

Federal Register of Legislative Instruments F2015L00242

Food and Grocery Code of Conduct Schedule 1

Conduct generally Part 3

Other conduct Division 4

Clause 21

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(4) Subclause (3) does not apply if:

(a) the retailer gives the supplier reasonable written notice of the

cancellation or reduction; or

(b) the retailer compensates the supplier for any net resulting

costs, losses or expenses incurred or suffered by the supplier

as a direct result of the retailer failing to give reasonable

notice of the cancellation or reduction.

21 Fresh produce standards and quality specifications

(1) The retailer must provide any fresh produce standards or quality

specifications to a supplier in clear, unambiguous and concise

written terms.

(2) The retailer must accept all fresh produce delivered in accordance

with relevant fresh produce standards and quality specifications.

(3) The retailer may reject fresh produce only if all of the following

conditions are satisfied:

(a) the produce fails to meet relevant fresh produce standards or

quality specifications;

(b) the retailer rejects the produce within 24 hours after the

produce is delivered to the retailer;

accepted the produce.

(4) If the retailer rejects fresh produce because it does not meet

relevant fresh produce standards or quality specifications, the

retailer must provide written reasons for the rejection to the

supplier within 48 hours.

(5) The retailer must communicate any labelling, packaging or

preparation requirements for a grocery product to a supplier in

clear, unambiguous and concise written terms.

(6) The retailer must provide a supplier with reasonable written notice

of any required changes to packaging, labelling or preparation

standards (unless the change is required immediately by law)

taking into consideration existing stock held by suppliers (where

Federal Register of Legislative Instruments F2015L00242

Schedule 1 Food and Grocery Code of Conduct

Part 3 Conduct generally

Division 4 Other conduct

Clause 22

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known) and any agreement as to stock coverage in the relevant

grocery supply agreement.

(7) The retailer must make any claim for damaged grocery products or

shortfalls, or any similar claims, within a reasonable time of, and in

any event no later than 30 days after, delivery of the groceries to

the retailer (or its nominee).

Note: See also clause 8 (matters to be covered by agreement).

22 Changes to supply chain procedures

(1) The retailer must not directly or indirectly require a supplier to

make any material change to supply chain procedures during the

period of the grocery supply agreement concerned.

(2) Subclause (1) does not apply if:

(a) the retailer gives the supplier reasonable written notice of the

change; or

(b) the retailer compensates the supplier for any net resulting

costs, losses or expenses incurred or suffered by the supplier

as a direct result of the retailer failing to give reasonable

notice of the change.

(3) Paragraph (2)(b) does not prevent a supplier from waiving a right

to compensation under that paragraph.

(4) This clause has effect subject to clause 9 (unilateral variation of

agreement) and clause 10 (retrospective variation of agreement).

23 Business disruption

The retailer must not threaten a supplier with business disruption or

termination of a grocery supply agreement without reasonable

grounds.

24 Intellectual property rights

(1) The retailer must respect the intellectual property rights held by

suppliers in relation to grocery products, including intellectual

property rights in branding, packaging and advertising.

Federal Register of Legislative Instruments F2015L00242

Food and Grocery Code of Conduct Schedule 1

Conduct generally Part 3

Other conduct Division 4

Clause 25

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(2) To avoid doubt, subclause (1) does not create, confer or extend any

intellectual property rights in or of the supplier.

(3) In developing or producing own brand products, the retailer must

not infringe the intellectual property rights held by a supplier in

relation to grocery products, including rights relating to branding,

packaging designs or advertising.

(4) In any dispute relating to a breach of this clause, any relevant

actions of the supplier in relation to the intellectual property rights

of the retailer must be taken into account.

(5) In taking action under Division 2 of Part 5 (complaints), the retailer

may take into account any relevant actions of the supplier in

relation to the intellectual property rights of the retailer.

25 Confidential information

(1) This clause applies if a supplier discloses confidential information

to the retailer in connection with the supply of grocery products,

including confidential information relating to product

development, proposed promotions or pricing.

(2) The retailer must not use that information other than for a purpose

for which it was disclosed and may only disclose it or make it

available or accessible to employees or agents of the retailer who

need to have that information in connection with that purpose.

(3) The retailer must establish and monitor systems to ensure

compliance with subclause (2).

(4) To avoid doubt, information is not confidential information for the

purposes of this clause if the information:

(a) is publicly available; or

(b) comes into the possession or knowledge of the retailer:

(i) independently of the supplier; and

(ii) without any breach of subclause (2) on the part of the

retailer.

Federal Register of Legislative Instruments F2015L00242

Schedule 1 Food and Grocery Code of Conduct

Part 3 Conduct generally

Division 4 Other conduct

Clause 26

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26 Allocation of shelf space

(1) The retailer’s product ranging and shelf space allocation principles

must be published or provided to all suppliers with whom the

retailer has grocery supply agreements.

(2) The retailer must act in accordance with the principles and keep

them up to date.

(3) Within a reasonable time before conducting a range review, the

retailer must provide suppliers who might be affected by any

outcome of the review with clearly expressed written notice of:

(a) the purpose of the range review; and

(b) the key criteria governing ranging decisions.

(4) Following the range review, the retailer must provide affected

suppliers with a reasonable period of time to discuss the outcomes

of the review, including the basis for the retailer’s final decisions.

(5) The retailer must apply its product ranging and shelf space

allocation principles without discrimination (including without

discrimination in favour of its own brand products).

(6) This clause does not limit clause 19.

27 Transfer of intellectual property rights

(1) The retailer must not directly or indirectly require a supplier to

transfer or exclusively license any intellectual property right held

by the supplier in relation to a grocery product as a condition or

term of supply of an equivalent own brand product.

(2) Subclause (1) does not prevent the retailer from:

(a) holding an intellectual property right in an own brand

product; or

(b) having an exclusive right to the retail sale of an own brand

product; or

by the retailer a condition or term of supply by the supplier of

Federal Register of Legislative Instruments F2015L00242

Food and Grocery Code of Conduct Schedule 1

Conduct generally Part 3

Other conduct Division 4

Clause 27

No. 16, 2015 Competition and Consumer (Industry Codes—Food and Grocery)

Regulation 2015

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an own brand product, to the extent the product, recipe or

formulation of the product:

(i) was developed or formulated by or for the retailer; or

(ii) is customised by or for the retailer.

Federal Register of Legislative Instruments F2015L00242

Schedule 1 Food and Grocery Code of Conduct

Part 4 Good faith etc.

Clause 28

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Part 4—Good faith etc.

28 Obligation to deal lawfully and in good faith

(1) The retailer or wholesaler must at all times deal with suppliers

lawfully and in good faith within the meaning of the unwritten law

as in force from time to time.

(2) The retailer or wholesaler must not enter into a grocery supply

agreement that contains a provision that limits or excludes the

obligation to act in good faith, and if it does, the provision has no

effect.

(3) In determining whether the retailer or wholesaler has acted in good

faith in dealing with a supplier, the following may be taken into

account:

(a) whether the retailer or wholesaler’s trading relationship with

the supplier has been conducted without duress;

(b) whether the retailer or wholesaler’s trading relationship with

the supplier has been conducted in recognition of the need for

certainty regarding the risks and costs of trading, particularly

in relation to production, delivery and payment;

supplier has acted in good faith.

(4) Subclause (3) does not limit subclause (1).

29 Freedom of association

(1) The retailer or wholesaler must not provide an inducement to

prevent a supplier from:

(a) forming an association of suppliers; or

(b) associating with other suppliers for a lawful purpose.

(2) The retailer or wholesaler must not discriminate, or take any other

action, against a supplier for:

(a) forming an association of suppliers; or

Federal Register of Legislative Instruments F2015L00242

Food and Grocery Code of Conduct Schedule 1

Good faith etc. Part 4

Clause 30

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Regulation 2015

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(b) associating with other suppliers for a lawful purpose.

30 Provision of contact details

(1) The retailer or wholesaler must make available to its suppliers, and

keep updated:

(a) contact details of the retailer or wholesaler’s buyers and

senior buyers for the supplier; and

(b) contact details for the retailer or wholesaler’s code

compliance manager.

(2) The contact details must include position titles and contact

telephone numbers.

Federal Register of Legislative Instruments F2015L00242

Schedule 1 Food and Grocery Code of Conduct

Part 5 Dispute resolution

Division 1 Preliminary

Clause 31

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Part 5—Dispute resolution

Division 1—Preliminary

31 Information and documents

(1) The retailer or wholesaler is not required to comply with this Part

in relation to a complaint or dispute unless, at the time of making

the complaint or notifying the dispute to the retailer or wholesaler,

the supplier concerned provides, or offers to provide and is capable

of providing, information and documents in accordance with

subclause (2).

(2) The information and documents must provide sufficient particulars

of the following to enable the retailer or wholesaler to investigate,

consider and respond to the complaint or dispute:

(a) the complaint or dispute;

(b) the conduct that is the subject of the complaint or dispute;

breached;

(d) the remedy or relief that the supplier is seeking.

Note: The supplier may supply any or all of the information or documents

subject to appropriate confidentiality protections.

(3) If the complaint relates to clause 9 (unilateral variation of

agreement) or 10 (retrospective variation of agreement), the

supplier provides sufficient particulars of the matters in paragraphs

2(a) and (b) if the supplier provides particulars of detriment that

has been, or will be, caused to the supplier.

32 Code compliance manager

(1) The retailer or wholesaler must nominate a person as the code

compliance manager for the retailer or wholesaler.

(2) The code compliance manager must:

(a) have access to:

Federal Register of Legislative Instruments F2015L00242

Food and Grocery Code of Conduct Schedule 1

Dispute resolution Part 5

Preliminary Division 1

Clause 32

No. 16, 2015 Competition and Consumer (Industry Codes—Food and Grocery)

Regulation 2015

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(i) the resources necessary to perform his or her functions;

and

(ii) all documentation relating to the retailer or wholesaler’s

obligations under this code; and

(iii) the retailer or wholesaler’s buying team for the purposes

of discussing issues relating to the retailer or

wholesaler’s obligations under this code; and

(b) be independent of, and not be managed by, any member of

the retailer or wholesaler’s buying team; and

procedure that:

(i) has been developed by the retailer or wholesaler; and

(ii) has been provided to the Commission; and

(iii) is reviewed annually and updated as necessary.

Federal Register of Legislative Instruments F2015L00242

Schedule 1 Food and Grocery Code of Conduct

Part 5 Dispute resolution

Division 2 Complaints

Clause 33

28 Competition and Consumer (Industry Codes—Food and Grocery)

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No. 16, 2015

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Division 2—Complaints

33 Referral of complaints

(1) A supplier may direct a complaint relating to a matter covered by

this code to the code compliance manager.

(2) The complaint must:

(a) be in writing; and

(b) include the following:

(i) the supplier’s identification details, including business

or trading name;

(ii) contact details for the supplier, or the person dealing

with the complaint on behalf of the supplier, including

the name, title and telephone number of that person;

(iii) details of the conduct giving rise to the complaint,

including the provision of this code relevant to the

complaint, together with any documents or other

information that would assist the investigation of the

complaint.

34 Immediate elevation of complaint

(1) The complaint may include a request for immediate elevation of

the complaint though senior levels of management.

(2) If the supplier makes such a request, the retailer or wholesaler must

elevate the complaint and attempt, within 20 business days, and in

good faith, to resolve the complaint.

35 Investigation by code compliance manager

(1) If the supplier does not request immediate elevation of the

complaint, the code compliance manager must take all reasonable

steps to:

(a) investigate the complaint; and

(b) conclude the investigation within 20 business days.

Federal Register of Legislative Instruments F2015L00242

Food and Grocery Code of Conduct Schedule 1

Dispute resolution Part 5

Complaints Division 2

Clause 36

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(2) Subclause (1) does not apply if the code compliance manager:

(a) is satisfied that the complaint is vexatious, trivial,

misconceived or lacking in substance; and

(b) gives the supplier written notice to that effect.

(3) However, if the complaint relates to clause 9 (unilateral variation

of agreement) or 10 (retrospective variation of agreement), the

code compliance manager must not be satisfied that the complaint

is vexatious, trivial, misconceived or lacking in substance only

because the supplier’s only ground in relation to the complaint is

detriment to the supplier.

(4) A notice under paragraph (2)(b) must set out:

(a) the compliance manager’s reasons for being satisfied that the

complaint is vexatious, trivial, misconceived or lacking in

substance; and

(b) that the supplier may take further action in relation to the

matter under clause 37 (internal review) or 38 (mediation or

arbitration).

36 Action following investigation

(1) Following the investigation, the code compliance manager must

determine what (if any) action should be taken in response to the

complaint.

(2) The code compliance manager must, within 5 business days after

the conclusion of the investigation, give the supplier a summary of

the action (if any) that has or will be taken in response to the

complaint and the timetable for any such action.

(3) The code compliance manager must keep the following for at least

6 years:

(a) a record of the complaint;

(b) a record of the investigations taken to investigate the

complaint;

Federal Register of Legislative Instruments F2015L00242

Schedule 1 Food and Grocery Code of Conduct

Part 5 Dispute resolution

Division 2 Complaints

Clause 37

30 Competition and Consumer (Industry Codes—Food and Grocery)

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No. 16, 2015

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37 Internal review

(1) This clause applies if:

(a) the supplier did not request immediate elevation of the

complaint in accordance with clause 34; and

(b) the supplier:

(i) is satisfied that no action has been taken in relation to

the complaint; or

(ii) is not satisfied with the outcome of the investigation

into the complaint under that clause; or

(iii) has been given notice under paragraph 35(2)(b) to the

effect that the code compliance manager is satisfied that

the complaint is vexatious, trivial, misconceived or

lacking in substance; or

(iv) has not been given a summary of action taken in relation

to the complaint in accordance with subclause 36(2).

(2) The supplier may give the retailer or wholesaler a written request

to elevate the dispute though senior levels of management.

(3) The request must specify:

(a) the nature of the dispute; and

(b) the provision of this code relevant to the dispute; and

(d) the outcome that the supplier is seeking.

(4) The retailer or wholesaler must elevate the dispute and attempt,

within 20 business days, and in good faith, to resolve the dispute.

Federal Register of Legislative Instruments F2015L00242

Food and Grocery Code of Conduct Schedule 1

Dispute resolution Part 5

Mediation and arbitration Division 3

Clause 38

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Division 3—Mediation and arbitration

38 Supplier may seek mediation or arbitration

(1) A supplier may seek either mediation or arbitration of a complaint

or dispute relating to a matter covered by this code.

(2) However, if the supplier has begun a process under Division 2

(complaints) in relation to the complaint or dispute, the supplier

must not seek mediation or arbitration of the complaint or dispute

until the process:

(a) has been completed; or

(b) should have been completed.

(3) The retailer or wholesaler:

(a) must take part in the mediation or arbitration in good faith;

but

(b) is not required by this code to take part in both mediation and

arbitration in relation to the same complaint or dispute at the

same time.

Note: See subclause 39(3) for when the retailer or wholesaler will be:

(a) taken to take part in the mediation or arbitration; and

(b) taken to be trying to resolve the dispute in good faith.

(4) In any dispute, the retailer or wholesaler has the onus of

establishing the matters in subclause (3).

(5) Despite paragraph (3)(a), the retailer or wholesaler is not required

to take part in the mediation or arbitration if the mediator considers

or the arbitrator determines that:

(a) the complaint or dispute is vexatious, trivial, misconceived or

lacking in substance; or

(b) the supplier is not acting in good faith.

(6) However, if the complaint or dispute relates to clause 9 (unilateral

variation of agreement) or 10 (retrospective variation of

agreement), the mediator or arbitrator must not consider or

determine that the complaint is vexatious, trivial, misconceived or

Federal Register of Legislative Instruments F2015L00242

Schedule 1 Food and Grocery Code of Conduct

Part 5 Dispute resolution

Division 3 Mediation and arbitration

Clause 39

32 Competition and Consumer (Industry Codes—Food and Grocery)

Regulation 2015

No. 16, 2015

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lacking in substance only because the supplier’s only ground in

relation to the complaint or dispute is detriment to the supplier.

39 Conduct of mediation and arbitration

(1) Mediation or arbitration for the purposes of this code must be

conducted in accordance with the rules of the Institute of

Arbitrators and Mediators Australia.

(2) If the mediator or arbitrator is not agreed by the parties within 10

business days of a supplier referring a matter, the mediator or

arbitrator must be appointed by the Institute of Arbitrators and

Mediators Australia in accordance with the rules of the Institute.

(3) For the purposes of paragraph 38(3)(a), the retailer or wholesaler:

(a) is taken to take part in the mediation or arbitration if the

retailer or wholesaler is represented at the mediation or

arbitration by a person who has authority to enter into an

agreement to settle the dispute on behalf of the retailer or

wholesaler; and

(b) is taken to be trying to resolve the dispute in good faith if the

retailer or wholesaler approaches the resolution of the dispute

in a reconciliatory manner, including by doing the following:

(i) attending and participating at meetings that are arranged

at reasonable times;

(ii) at the beginning of the mediation or arbitration process,

making it clear what the retailer or wholesaler is trying

to achieve through the mediation or arbitration;

(iii) observing any obligation relating to confidentiality that

applies during or after the mediation or arbitration

process;

(iv) not taking or refusing to take action during the dispute,

including refusing to accept goods or to make payments,

that has the purpose or effect of applying pressure to

resolve the dispute.

(4) All costs of any mediation or arbitration are to be determined under

the rules of the Institute of Arbitrators and Mediators Australia.

Federal Register of Legislative Instruments F2015L00242

Food and Grocery Code of Conduct Schedule 1

Dispute resolution Part 5

Mediation and arbitration Division 3

Clause 39

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Regulation 2015

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(5) The Minister may, by legislative instrument, modify the operation

of this clause by substituting another body in place of the Institute

of Arbitrators and Mediators Australia.

Federal Register of Legislative Instruments F2015L00242

Schedule 1 Food and Grocery Code of Conduct

Part 6 Compliance and reporting

Clause 40

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No. 16, 2015

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Part 6—Compliance and reporting

40 Duty to train staff with respect to this code

(1) Within 6 months of being bound by this code, the retailer or

wholesaler must provide its buying team with:

(a) a copy of this code; and

(b) training on the requirements of this code.

(2) The retailer or wholesaler must provide any person who becomes

part of the retailer or wholesaler’s buying team after the retailer or

wholesaler is bound by this code with:

(a) a copy of this code; and

(b) training on the requirements of this code.

(3) The retailer or wholesaler must comply with subclause (2) within

20 business days after the person becomes part of the buying team.

(4) The retailer or wholesaler must provide annual retraining to its

buying team on the requirements of this code.

41 Reports by code compliance managers

(1) A code compliance manager must prepare a written report in

respect of each 6-month period beginning on 1 January and 1 July.

(2) The report must:

(a) be prepared within 30 business days after the end of the

period; and

(b) set out the following:

(i) the number of complaints received for investigation in

the reporting period;

(ii) in general terms and without identifying a

complainant—the nature of the complaints received;

(iii) the time taken to investigate each complaint;

(iv) the outcome of each investigation;

Federal Register of Legislative Instruments F2015L00242

Food and Grocery Code of Conduct Schedule 1

Compliance and reporting Part 6

Clause 42

No. 16, 2015 Competition and Consumer (Industry Codes—Food and Grocery)

Regulation 2015

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(v) whether or not each complaint was resolved to the

satisfaction of the complainant.

42 Keeping records

(1) The retailer or wholesaler must keep the original or a copy of each

grocery supply agreement to which the retailer or wholesaler is a

party while bound by this code (including any document

comprising the agreement, and any document made from time to

time under the agreement that forms part of the agreement):

(a) during the term of the agreement; and

(b) for 6 years after the agreement ends.

(2) The retailer or wholesaler must keep the original or a copy of each

of the following for at least 6 years from when the document is

made or given, as the case requires:

(a) an offer made under subclause 5(2) or 6(2) to vary a grocery

supply agreement;

(b) notice of variation of a grocery supply agreement given under

paragraph 9(2)(d) or 10(2)(d);

paragraph 19(5)(a);

(d) notice of the outcome of the review of a decision to delist a

product given under subclause 19(7);

(e) reasons for rejection of fresh produce given under

subclause 21(4);

(f) notice of required changes to packaging, labelling or

preparation standards given under subclause 21(6);

(g) notice of material change to supply chain procedures given

under paragraph 22(2)(a);

(h) notice of a range review given under subclause 26(3);

(i) notice that a complaint is vexatious, trivial, misconceived or

lacking in substance given under paragraph 35(2)(b);

(j) a summary of action that has or will be taken in response to a

complaint and the timetable for the action given under

subclause 36(2);

Federal Register of Legislative Instruments F2015L00242

Schedule 1 Food and Grocery Code of Conduct

Part 6 Compliance and reporting

Clause 42

36 Competition and Consumer (Industry Codes—Food and Grocery)

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No. 16, 2015

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(k) a code compliance manager’s report prepared under

subclause 41(1).

Federal Register of Legislative Instruments F2015L00242

Competition and Consumer (Industry Codes—Food and Grocery) Regulation 2015, Australia

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