The Albanese Government is ensuring that supermarkets will face multi‑million‑dollar penalties for harmful breaches of the Food and Grocery Code of Conduct.
The Albanese Government will today introduce the Treasury Laws Amendment (Fairer for Families and Farmers and Other Measures) Bill 2024. The Bill will ensure penalties for treating suppliers poorly in breach of the Code is not merely a cost of doing business.
The Bill provides that the maximum fines that can be prescribed under the Food and Grocery Code will be the greater of:
- $10 million
- three times the value of the benefit gained from the contravening conduct, or
- 10 per cent of turnover in the preceding 12 months.
These are serious penalties. They are the highest corporate penalties under any industry code.
This Bill will also increase infringement notice penalties for alleged breaches of the Code. The Australian Competition and Consumer Commission can issue infringement notices where it has reasonable grounds to believe that a supermarket has breached the Code. These are an important tool in the Australian Competition and Consumer Commission armoury that allow for efficient, low‑cost enforcement outcomes for minor breaches.
This is part of the Government’s broader competition policy agenda to get families and farmers a fair go, including:
- cracking down on shrinkflation by strengthening the Unit Pricing Code to make it easier for Australians to make accurate and timely price comparisons
- working with the states and territories to reform planning and zoning regulations to boost competition and reduce land banking
- ensuring the Australian Competition and Consumer Commission will be notified of every merger in the supermarket sector, in the biggest strengthening of Australia’s merger settings in half a century
- providing the Australian Competition and Consumer Commission with an additional $30 million in funding to crack down on misleading and deceptive pricing practices in the supermarket and retail sectors.
Regulations to make the new mandatory Food and Grocery Code of Conduct will be made this year, with the Code coming into force from 1 April 2025. The new Code will help to ensure our supermarkets are as competitive as they can be so Australians get the best prices possible.
Quotes attributable to Minister for Agriculture, Fisheries and Forestry, Julie Collins MP:
“This is about getting a fair go for families and a fair go for farmers.
“The Albanese Labor Government knows how vital our agriculture sector is to Australia, and the Australian economy.
“Our farmers produce exceptional, high‑quality food and deserve to be on a level playing field with supermarkets.
“Since coming to Government in 2022 we have been delivering for Australian farmers and producers, and today’s important reforms are another significant step forward.”
Quotes attributable to Assistant Minister for Competition, Charities and Treasury, Andrew Leigh MP:
“We want a system that locks in substantial multi‑million dollar penalties for bad conduct from supermarkets.
“We’re cracking down on supermarket misconduct because it will help shoppers at the register, and it will help farmers and suppliers at the negotiating table.
“When the Food and Grocery Code was established by the former Coalition Government in 2014, it was set up as a voluntary code. When it was reviewed in 2018, the former Coalition government decided that it should remain a voluntary code.
“Labor’s wide ranging competition policy agenda is good for families and farmers. More competition means a more dynamic and competitive economy.”