ACCC welcomes grocery code of conduct; calls for further discussion

Wednesday, 01 October, 2014

An industry-led proposed code of conduct for the grocery sector has been welcomed by the Australian Competition and Consumer Commission (ACCC). However, the commission has called for enforceability and coverage issues to be discussed before a conclusion is reached.

A code of conduct that provides clear rights and legally enforceable norms of conduct would be of considerable assistance to food and grocery industry participants, ACCC Chairman Rod Sims said at the Australian Food and Grocery Council’s (AFGC’s) Industry Leaders Forum.

“However, many of the protections of the proposed code are qualified and retailers and suppliers are able to agree to ‘contract out’ of code provisions,” Sims said.

“This raises an issue of whether the code will address the problems which industry has identified if norms of conduct in the code are able to be traded away, rather than always enforceable.”

Sims also welcomed the Harper Competition Review Draft Report and discussed proposed areas of microeconomic reform where the food and grocery sector stands to benefit.

“On road infrastructure provision and pricing, we support the panel’s recommendation on introducing cost-reflective road pricing linked to road construction, maintenance and safety,” Sims said.

“Importantly, more effective road user charges can be offset by lower fuel taxes, which currently account for one quarter of fuel prices.

“The ACCC also welcomes the draft recommendations to deepen competition in liner and coastal shipping services. This will also reduce your production costs.”

Sims welcomed the review panel’s consideration of Australia’s competition laws.

“In doing so, they have clearly had regard to established international approaches to setting the appropriate boundaries of such laws. Australia’s competition laws are behind international best practice in important respects,” he said.

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