Supermarkets to be fined if found mistreating suppliers
The nation's biggest supermarkets will soon face the threat of multi-billion dollar fines if they're found to be rorting and bullying Australian suppliers. The Federal Government has agreed to all the recommendations of a review into the food and grocery code of conduct.
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00:00Guy Gayette has been tending his orchard for four decades and believes the big supermarkets
00:06are rotten.
00:07When you complain, you'll be out the door.
00:10They just discard you like, just like a piece of rag.
00:14Instead he sells his apples direct to hungry customers and markets.
00:18If I didn't change my ways around 15 years ago, I wouldn't be here now.
00:23For too long we've seen supermarket chains take advantage of suppliers, our small farmers
00:28right across the country.
00:30The Voluntary Code of Conduct written by the supermarkets themselves a decade ago will
00:34now become mandatory and be beefed up.
00:37If the supermarkets behave properly, they shouldn't be too worried about this.
00:44It'll apply to the big players, Coles, Woolworths, Aldi and wholesaler Metcash, which supplies
00:49IGA, companies with an annual revenue of $5 billion.
00:54Costco at the moment has turnover of $4.6 billion, so if it grows it would come within
01:00the scope.
01:01Suppliers blowing the whistle on dodgy conduct would be given the ability to report it anonymously
01:05to ease concerns about retribution.
01:08And disputes would be heard by independent mediators.
01:11Court imposed penalties for misconduct would be $10 million or three times the benefit
01:16gained from the breach.
01:17Or if the benefit can't be properly calculated, 10% of annual turnover.
01:22The latter could run into the billions.
01:24I think if those penalties had been in place, we would have now seen better behaviour by
01:28the big supermarkets.
01:29It is not the silver bullet that governments think this Code is.
01:34Something not part of the plan powers allowing the forced breaking up of supermarket companies.
01:39What we need is divestiture laws that will smash up the supermarket duopoly.
01:44Why wouldn't you have divestiture powers on a commodity that underpins all life?
01:48It sounds kind of terrifying, but in fact it would be completely ineffective and therefore
01:55not credible.
01:56The major supermarkets are considering how this new Code of Conduct will apply to them,
02:00but they do insist that the situation is nowhere near as bad as what the government and suppliers
02:06are making it out to be.
02:08There's no time frame for these new rules to be in force, and little evidence that this
02:12Code in isolation will lead to better prices for Australian customers at the checkout.
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