The Grocery Code is a voluntary industry code of conduct that is prescribed for the purposes of Part IVB of the Competition and Consumer Act 2010 (CCA). The Grocery Code governs certain conduct by the supermarkets (also referred to as retailers) and wholesalers in their dealings with suppliers, with the aim to improve standards of business conduct in the food and grocery industry.

The Grocery Code is voluntary – it only applies to retailers or wholesalers that have elected to be bound by giving written notice to the Australian Competition and Consumer Commission (ACCC), which is responsible for enforcing the Grocery Code. A signatory can also withdraw from the Grocery Code by writing to the ACCC. Suppliers are automatically protected by the Grocery Code when dealing with a signatory.

The proposed reforms outlined in this report aim to benefit the food and grocery industry by promoting sustainability, encouraging new entrants into the market and fostering greater competition. The report also recommends a number of other amendments to the Grocery Code to ensure it works effectively for the food and grocery industry.

Key recommendations:

• The government should consider introducing a targeted mandatory code for industry participants with significant market power that refuse to become signatories.
• The Grocery Code should be amended so that wholesalers are subject to the same Grocery Code obligations as retailers (including the general conduct provisions in Part 3), except for customer facing provisions that are only relevant to retailers.
• The government should appoint an Independent Reviewer
• The ACCC should consider adopting a collaborative approach with signatories, Code Arbiters and the Independent Reviewer to encourage more active compliance with the Grocery Code.