27 March 2019

Food and Grocery Code reforms to foster healthy commercial dealings


I am pleased to release the Morrison Government’s response to the independent Review of the Food and Grocery Code accepting most of the 14 recommendations.

Aldi, Coles, Woolworths and About Life are the current signatories bound by the Code. Metcash, Australia’s only national wholesaler has indicated it intends to sign up to the amended Code.

We are committed to ensuring the right regulatory settings are in place to improve certainty, transparency and fairness between food and grocery retailers/wholesalers and their suppliers.

We have listened to industry and we intend to make a range of important changes to the Code, such as:

  • enhancing the good faith obligations to make it clearer and more user friendly for the industry;
  • strengthening the dispute resolution procedures to give suppliers more confidence in raising their complaints and having them resolved; and
  • setting limits on acceptable conduct during price rise negotiations between the parties to restore trust and cooperation between parties.

I believe this approach will cultivate a competitive and sustainable grocery industry, delivering benefits across the wider community. It will also ensure healthy commercial dealings between major supermarkets and wholesalers with their suppliers, guaranteeing Australians have the best choice as well as quality products on shelves.

I thank Professor Graeme Samuel AC for leading the review and for his productive engagement with the industry and valuable contribution towards shaping our food and grocery regulation. I also thank all the businesses that gave their time during the review and consultation process.

The report makes a strong case for amendments to the Food and Grocery Code building on the significant progress made by the industry towards changing business culture and fostering positive commercial relationships.

I look forward to continuing to work closely with the food and grocery sector to implement these important changes to this industry-led initiative. The Government will consult publicly on the draft legislative changes to the Code.