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Competition and Consumer (Industry
Codes—Food and Grocery)
Regulation 2015
Select Legislative Instrument No. 16, 2015
I, General the Honourable Sir Peter Cosgrove AK MC (Ret’d),
Governor-General of the Commonwealth of Australia, acting with the
advice of the Federal Executive Council, make the following regulation.
Dated 26 February 2015
Peter Cosgrove
Governor-General
By His Excellency’s Command
Bruce Billson
Minister for Small Business
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i Competition and Consumer (Industry Codes—Food and Grocery)
Regulation 2015
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Contents 1 Name .................................................................................................1
2 Commencement.................................................................................1
3 Authority ...........................................................................................1
4 Code of conduct.................................................................................1
5 Review of Code .................................................................................1
Schedule 1—Food and Grocery Code of Conduct 3
Part 1—Preliminary 3 1 Name .................................................................................................3
2 Purpose of code .................................................................................3
3 Definitions.........................................................................................3
4 When this code applies ......................................................................6
5 Transitional application—retailers ....................................................6
6 Transitional application—wholesalers ..............................................7
Part 2—Grocery supply agreements 8 7 Grocery supply agreement must be in writing and retained...............8
8 Matters to be covered by agreement ..................................................8
9 Unilateral variation of agreement ......................................................9
10 Retrospective variation of agreement ................................................9
Part 3—Conduct generally 11
Division 1—Application of this Part 11
11 Application of this Part....................................................................11
Division 2—Paying suppliers 12
12 Payments to suppliers ......................................................................12
Division 3—Requiring payments from suppliers 13
13 Payments for shrinkage ...................................................................13
14 Payments for wastage ......................................................................13
15 Payments as a condition of being a supplier ....................................14
16 Payments for better positioning of groceries ...................................14
17 Payments for retailer’s activities .....................................................15
18 Funding promotions.........................................................................16
Division 4—Other conduct 17
19 Delisting products............................................................................17
20 Funded promotions..........................................................................18
21 Fresh produce standards and quality specifications .........................19
22 Changes to supply chain procedures................................................20
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23 Business disruption..........................................................................20
24 Intellectual property rights...............................................................20
25 Confidential information .................................................................21
26 Allocation of shelf space .................................................................22
27 Transfer of intellectual property rights ............................................22
Part 4—Good faith etc. 24 28 Obligation to deal lawfully and in good faith ..................................24
29 Freedom of association....................................................................24
30 Provision of contact details..............................................................25
Part 5—Dispute resolution 26
Division 1—Preliminary 26
31 Information and documents .............................................................26
32 Code compliance manager...............................................................26
Division 2—Complaints 28
33 Referral of complaints .....................................................................28
34 Immediate elevation of complaint ...................................................28
35 Investigation by code compliance manager .....................................28
36 Action following investigation ........................................................29
37 Internal review.................................................................................30
Division 3—Mediation and arbitration 31
38 Supplier may seek mediation or arbitration .....................................31
39 Conduct of mediation and arbitration ..............................................32
Part 6—Compliance and reporting 34 40 Duty to train staff with respect to this code .....................................34
41 Reports by code compliance managers............................................34
42 Keeping records...............................................................................35
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Section 1
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Regulation 2015
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1 Name
This is the Competition and Consumer (Industry Codes—Food and
Grocery) Regulation 2015.
2 Commencement
This instrument commences on the day after it is registered.
3 Authority
This instrument is made under section 51AE of the Competition
and Consumer Act 2010.
4 Code of conduct
For section 51AE of the Competition and Consumer Act 2010, the
code set out in Schedule 1:
(a) is prescribed; and
(b) is a voluntary industry code.
Note: Only grocery retailers and wholesalers can be bound by the code. For
how a retailer or wholesaler agrees to be bound by the code, and
ceases to be so bound, see clause 4 of the code.
5 Review of Code
(1) The Minister administering section 51AE of the Competition and
Consumer Act 2010 must cause a review to be undertaken of the
operation of the Food and Grocery Code of Conduct (the code).
(2) The review must start before the end of the period of 3 years after
the commencement of this section.
(3) The review must assess the impact of the code in improving
commercial relations between grocery retailers, wholesalers and
suppliers.
(4) The review must address the following:
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(a) the extent to which retailers and wholesalers have become
bound by the code;
(b) levels of compliance with the code by retailers and
wholesalers bound by the code;
(c) whether the purposes of the code (see clause 2 of the code)
are being met;
(d) the extent to which the code assists in addressing any
imbalances in the allocation of risks between retailers,
wholesalers and suppliers;
(e) whether there are any further measures that would improve
the operation of the code with respect to the matters
mentioned in paragraphs (c) and (d);
(f) the interactions between the code and the Horticulture Code
of Conduct;
(g) how the code compares with overseas regulation of
commercial relations between retailers, wholesalers and
suppliers;
(h) whether the code should be mandatory or voluntary;
(i) whether the code should include civil penalty provisions;
(j) whether retailers, wholesalers and suppliers should be bound
by the code, and if so, to what extent;
(k) whether the code should be repealed or amended and, if so,
the timing of any such repeal or amendment;
(l) the products that should be covered by the code.
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Food and Grocery Code of Conduct Schedule 1
Preliminary Part 1
Clause 1
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Schedule 1—Food and Grocery Code of
Conduct Note: See section 4.
Part 1—Preliminary
1 Name
This is the Food and Grocery Code of Conduct.
2 Purpose of code
The purpose of this code is:
(a) to help to regulate standards of business conduct in the
grocery supply chain and to build and sustain trust and
cooperation throughout that chain; and
(b) to ensure transparency and certainty in commercial
transactions in the grocery supply chain and to minimise
disputes arising from a lack of certainty in respect of the
commercial terms agreed between parties; and
(c) to provide an effective, fair and equitable dispute resolution
process for raising and investigating complaints and
resolving disputes arising between retailers or wholesalers
and suppliers; and
(d) to promote and support good faith in commercial dealings
between retailers, wholesalers and suppliers.
3 Definitions
In this code:
Act means the Competition and Consumer Act 2010.
buying team means the employees of a retailer or wholesaler
whose role includes at least one of the following:
(a) direct involvement in buying grocery products;
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(b) immediate management responsibility for an employee
covered by paragraph (a).
code compliance manager means a person nominated under
subclause 32(1).
delist means to remove a grocery product from a retailer’s range of
grocery products.
groceries includes the following:
(a) food including fresh produce, meat and dairy items (other
than dairy items sold for in-store consumption);
(b) pet food;
(c) non-alcoholic drinks (other than drinks sold for in-store
consumption);
(d) cleaning products;
(e) toiletries, perfumes and cosmetics;
(f) household goods, electrical appliances and kitchenware;
(g) clothing;
(h) “do-it-yourself” products;
(i) pharmaceuticals;
(j) books, newspapers, magazines and greeting cards;
(k) CDs, DVDs, videos and audio tapes;
(l) toys;
(m) plants, flowers and gardening equipment;
(n) tobacco and tobacco products.
grocery supply agreement means any agreement between a retailer
or wholesaler and a supplier for the supply of groceries to or for
the purposes of a supermarket business and includes any
document:
(a) comprising the agreement; or
(b) made, from time to time, under the agreement.
own brand product means a grocery product:
(a) produced, processed or manufactured by a retailer; or
(b) produced, processed or manufactured for a retailer (including
by a supplier); or
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Clause 3
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(c) that carries a name or trade mark owned by, or licensed to, a
retailer.
promotion means any offer for sale (whether or not accompanied
by some other benefit to a consumer):
(a) at an introductory or reduced price, or involving
non-standard sales activity; and
(b) as agreed between a retailer and a supplier; and
(c) that is intended to last only for a specified period.
retailer means a corporation:
(a) to the extent that it carries on a supermarket business in
Australia for the retail supply of groceries; and
(b) to the extent that it carries on a business of purchasing
groceries from suppliers for the purpose of resale to a person
carrying on a supermarket business in Australia for the retail
supply of groceries.
senior buyer, in relation to a supplier, means the employee within
a retailer or wholesaler’s buying team who manages the buyers
who buy from the supplier.
shrinkage means a loss of grocery products that:
(a) occurs after a retailer has taken possession of them; and
(b) arises from theft, other loss or accounting error.
supermarket business means a business under which a person sells
to consumers bread, breakfast cereal, butter, eggs, flour, fresh fruit
and vegetables, fresh milk, meat, rice, sugar and other packaged
food or most of those groceries.
supplier means a person carrying on (or actively seeking to carry
on) a business of supplying groceries for retail sale by another
person.
wastage means groceries that are unfit for sale.
wholesaler means a corporation to the extent that it carries on a
business of purchasing groceries from suppliers for the purpose of
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Part 1 Preliminary
Clause 4
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resale to a person carrying on a supermarket business in Australia
for the retail supply of groceries.
4 When this code applies
(1) This code binds a corporation as a retailer if the corporation has
agreed, by written notice given to the Commission, to be bound by
this code as a retailer.
(2) This code binds a corporation as a wholesaler if the corporation has
agreed, by written notice given to the Commission, to be bound by
this code as a wholesaler.
Note 1: Part 3 of this code does not apply to a corporation that is bound by this
code as a wholesaler: see clause 11.
Note 2: Clauses 5 and 6 provide transitional arrangements in relation to
grocery supply agreements entered into by retailers and wholesalers
before being bound by this code.
(3) The corporation ceases to be bound by this code if the corporation,
by written notice given to the Commission, withdraws the
agreement.
(4) This code does not apply to the extent that it conflicts with:
(a) the Horticulture Code of Conduct; or
(b) the Franchising Code of Conduct.
(5) To avoid doubt, withdrawing agreement to be bound by this code
does not remove any obligation under this code that relates to
conduct that occurred when the corporation was so bound.
5 Transitional application—retailers
(1) This clause applies if a retailer is a party to a grocery supply
agreement entered into before the retailer was bound by this code.
(2) Within 6 months after being bound by this code, the retailer must
offer in writing to vary the agreement so that it conforms with the
requirements of this code in relation to making grocery supply
agreements.
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Clause 6
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(3) If the supplier concerned accepts the offer, the retailer must so vary
the agreement within 6 months after the offer is accepted.
(4) Parts 2, 3, 5 and 6 of this code do not apply in relation to the
supply of groceries under the agreement until one of the following
occurs:
(a) the agreement is varied under subclause (3);
(b) the period of 12 months that begins when the retailer is
bound by the code ends.
6 Transitional application—wholesalers
(1) This clause applies if a wholesaler is a party to a grocery supply
agreement entered into before the wholesaler was bound by this
code.
(2) Within 18 months after being bound by this code, the wholesaler
must offer in writing to vary the agreement so that it conforms with
the requirements of this code in relation to making grocery supply
agreements.
(3) If the supplier concerned accepts the offer, the wholesaler must so
vary the agreement within 6 months after the offer is accepted.
(4) Parts 2, 5 and 6 of this code do not apply in relation to the supply
of groceries under the agreement until one of the following occurs:
(a) the agreement is varied under subclause (3);
(b) the period of 24 months that begins when the wholesaler is
bound by the code ends.
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Schedule 1 Food and Grocery Code of Conduct
Part 2 Grocery supply agreements
Clause 7
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Part 2—Grocery supply agreements
7 Grocery supply agreement must be in writing and retained
The retailer or wholesaler must not enter into a grocery supply
agreement unless it is in writing.
Note: The retailer or wholesaler must keep the original or a copy of each
grocery supply agreement to which the retailer or wholesaler is a party
while bound by this code (including any document comprising the
agreement, and any document made from time to time under the
agreement that forms part of the agreement):
(a) during the term of the agreement; and
(b) for 6 years after the agreement ends.
See subclause 42(1).
8 Matters to be covered by agreement
The retailer or wholesaler must not enter into a grocery supply
agreement unless the agreement specifies the following:
(a) any requirements the retailer or wholesaler has in respect of
the delivery of the groceries;
(b) any circumstances in which the retailer or wholesaler may
reject the groceries;
(c) the period within which the retailer or wholesaler must pay
the supplier for the groceries and the circumstances in which
any payment, or part of a payment, may be withheld or
delayed;
(d) if the agreement is intended to operate for a limited time
only—the term of the agreement;
(e) in clear terms, any quantity and quality requirements relating
to the groceries;
(f) if the agreement provides for termination by one or more
parties to it—the circumstances in which it may be
terminated.
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Food and Grocery Code of Conduct Schedule 1
Grocery supply agreements Part 2
Clause 9
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9 Unilateral variation of agreement
(1) The retailer or wholesaler must not vary a grocery supply
agreement without the consent of the supplier concerned.
(2) Subclause (1) does not apply if:
(a) the agreement:
(i) provides expressly for the retailer or wholesaler to make
the variation; and
(ii) sets out clearly the changed circumstances in which the
variation can be made; and
(iii) if the variation involves a quantitative adjustment to the
terms of supply—sets out the basis or methodology for
calculating the adjustment; and
(b) the variation is made in accordance with the agreement; and
(c) the variation is reasonable in the circumstances; and
(d) the supplier is given reasonable notice, in writing, of:
(i) the variation; and
(ii) the terms of the variation; and
(iii) the retailer or wholesaler’s reasons for making the
variation.
(3) In determining whether the variation is reasonable in the
circumstances, regard must be had to the benefits, costs and risks
(if any) for the supplier and retailer or wholesaler.
(4) Subclause (3) does not limit paragraph (2)(c).
(5) In any dispute, the retailer or wholesaler has the onus of
establishing the matters in subclause (2).
(6) In any dispute in relation to a contravention of subclause (1), a
person alleging detriment to a supplier in relation to
paragraph (2)(c) has the onus of establishing that detriment.
10 Retrospective variation of agreement
(1) The retailer or wholesaler must not vary a grocery supply
agreement with retrospective effect.
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Part 2 Grocery supply agreements
Clause 10
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(2) Subclause (1) does not apply if:
(a) the agreement:
(i) provides expressly for the retailer or wholesaler to make
the variation; and
(ii) sets out clearly the changed circumstances, which must
be circumstances beyond the control of the retailer or
wholesaler, in which the variation can be made; and
(iii) if the variation involves a quantitative adjustment to the
terms of supply—sets out the basis or methodology for
calculating the adjustment; and
(b) the variation is made in accordance with the agreement; and
(c) the variation is reasonable in the circumstances; and
(d) the supplier is given reasonable notice, in writing, of:
(i) the variation; and
(ii) the terms of the variation; and
(iii) the retailer or wholesaler’s reasons for making the
variation.
(3) In determining whether the variation is reasonable in the
circumstances, regard must be had to the benefits, costs and risks
(if any) for the supplier and retailer or wholesaler.
(4) Subclause (3) does not limit paragraph (2)(c).
(5) In any dispute, the retailer or wholesaler has the onus of
establishing the matters in subclause (2).
(6) In any dispute in relation to a contravention of subclause (1), a
person alleging detriment to a supplier in relation to
paragraph (2)(c) has the onus of establishing that detriment.
Federal Register of Legislative Instruments F2015L00242
Food and Grocery Code of Conduct Schedule 1
Conduct generally Part 3
Application of this Part Division 1
Clause 11
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Part 3—Conduct generally
Division 1—Application of this Part
11 Application of this Part
This Part does not apply to a corporation that is bound by this code
as a wholesaler.
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Schedule 1 Food and Grocery Code of Conduct
Part 3 Conduct generally
Division 2 Paying suppliers
Clause 12
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Division 2—Paying suppliers
12 Payments to suppliers
(1) The retailer must pay a supplier for all grocery products delivered
and accepted in accordance with a grocery supply agreement:
(a) within the time frame set out in the agreement; and
(b) in any case—within a reasonable time after receiving the
supplier’s invoice for the products.
(2) The retailer must not:
(a) set off any amount against a supplier’s invoice or remittance
unless the supplier has consented in writing to the set-off of
the amount; or
(b) require a supplier to consent to set off such an amount.
(3) Subclause (2) does not apply if:
(a) the grocery supply agreement provides for the amount to be
set off; and
(b) the set-off is reasonable in the circumstances.
(4) In any dispute, the retailer has the onus of establishing the matters
in subclause (3).
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Food and Grocery Code of Conduct Schedule 1
Conduct generally Part 3
Requiring payments from suppliers Division 3
Clause 13
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Division 3—Requiring payments from suppliers
13 Payments for shrinkage
(1) The retailer must not:
(a) enter into a grocery supply agreement under which a supplier
is required to make payments as compensation for shrinkage;
or
(b) otherwise require such payments.
(2) Subclause (1) does not prevent the retailer from raising, discussing
or agreeing with a supplier proposals and procedures to mitigate
the risk and occurrence of shrinkage.
14 Payments for wastage
(1) The retailer must not directly or indirectly require a supplier to
make any payment to cover any wastage of groceries incurred at
premises of the retailer or its contractors or agents or another
retailer.
(2) Subclause (1) does not apply if:
(a) the relevant grocery supply agreement sets out expressly and
unambiguously the circumstances, which could include
negligence, in which the supplier will be required to make
payments to cover wastage of the supplier’s groceries
incurred at premises of the retailer or its contractor or agents;
and
(b) the wastage occurs in such circumstances; and
(c) the basis of the payment is set out in the grocery supply
agreement; and
(d) the payment is reasonable having regard to the retailer’s costs
incurred by the wastage; and
(e) the retailer takes reasonable steps to mitigate those costs.
(3) In any dispute, the retailer has the onus of establishing the matters
in subclause (2).
Federal Register of Legislative Instruments F2015L00242
Schedule 1 Food and Grocery Code of Conduct
Part 3 Conduct generally
Division 3 Requiring payments from suppliers
Clause 15
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15 Payments as a condition of being a supplier
(1) The retailer must not require a supplier to make any payment as a
condition of stocking or listing grocery products.
(2) Subclause (1) does not apply if:
(a) the payment is made in relation to a promotion; or
(b) the payment:
(i) is required under the relevant grocery supply agreement;
and
(ii) is made in respect of groceries that have not been
stocked, displayed or listed by the retailer during the
preceding 365 days in 25% or more of its stores; and
(iii) is reasonable having regard to the costs and risks to the
retailer in stocking, displaying or listing the grocery
products.
(3) Paragraph (2)(a) has effect subject to clause 18 (funding
promotions).
(4) In any dispute, the retailer has the onus of establishing the matters
in subclause (2).
16 Payments for better positioning of groceries
(1) The retailer must not require a supplier to make any payment to
secure either of the following for a grocery product:
(a) better positioning;
(b) an increase in allocation of shelf space.
(2) Subclause (1) does not apply if:
(a) the payment is required under the relevant grocery supply
agreement; and
(b) the agreement sets out the particular circumstances in which
the payment may be required; and
(c) the payment is reasonable having regard to either or both of
the following:
(i) the additional benefits (if any) to the supplier;
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Food and Grocery Code of Conduct Schedule 1
Conduct generally Part 3
Requiring payments from suppliers Division 3
Clause 17
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(ii) the costs and risks to the retailer of allocating additional
or different shelf space.
Note: For example, a grocery supply agreement may provide for a supplier
to make a payment in relation to the promotion of the supplier’s
product.
(3) In any dispute, the retailer has the onus of establishing the matters
in subclause (2).
17 Payments for retailer’s activities
(1) The retailer must not directly or indirectly require a supplier to
make any payment towards the costs of any of the following (the
retailer’s activities):
(a) a buyer’s visit to the supplier;
(b) artwork or packaging design;
(c) consumer or market research;
(d) the opening or refurbishing of a store;
(e) hospitality for the retailer’s staff.
(2) Subclause (1) does not apply if:
(a) the relevant grocery supply agreement provides for the
payment; and
(b) the payment is reasonable in the circumstances.
(3) In determining whether the payment is reasonable in the
circumstances, regard must be had to the following:
(a) the likely benefits to the supplier from the retailer’s
activities;
(b) the likely benefits to the retailer from the retailer’s activities;
(c) the costs borne, or contributions made, by the retailer for the
retailer’s activities.
(4) Subclause (3) does not limit paragraph (2)(b).
(5) In any dispute, the retailer has the onus of establishing the matters
in subclause (2).
Federal Register of Legislative Instruments F2015L00242
Schedule 1 Food and Grocery Code of Conduct
Part 3 Conduct generally
Division 3 Requiring payments from suppliers
Clause 18
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18 Funding promotions
(1) The retailer must not directly or indirectly require a supplier to
fund part or all of the costs of a promotion.
(2) Subclause (1) does not apply if:
(a) the relevant grocery supply agreement provides for the
funding; and
(b) the funding is reasonable in the circumstances.
(3) In determining whether the funding is reasonable in the
circumstances, regard must be had to the following:
(a) the likely benefits to the supplier from the promotion;
(b) the likely benefits to the retailer from the promotion;
(c) the costs borne, or contributions made, by the retailer for the
promotion.
(4) Subclause (3) does not limit paragraph (2)(b).
(5) In any dispute, the retailer has the onus of establishing the matters
in subclause (2).
Federal Register of Legislative Instruments F2015L00242
Food and Grocery Code of Conduct Schedule 1
Conduct generally Part 3
Other conduct Division 4
Clause 19
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Division 4—Other conduct
19 Delisting products
(1) The retailer may only delist a supplier’s grocery product:
(a) in accordance with the terms of the relevant grocery supply
agreement; and
(b) for genuine commercial reasons.
(2) For the purpose of subclause (1), genuine commercial reasons for
delisting a product include the following:
(a) failure of the supplier to meet agreed quality or quantity
requirements with respect to the product;
(b) failure of the supplier’s product to meet the retailer’s
commercial sales or profitability targets as notified to the
supplier in, or in accordance with, the grocery supply
agreement;
(c) persistent failure to meet the retailer’s delivery requirements
as notified to the supplier from time to time in accordance
with the grocery supply agreement.
(3) Subclause (2) does not limit subclause (1).
(4) To avoid doubt, delisting as a punishment for a complaint, concern
or dispute raised by a supplier is not a genuine commercial reason.
(5) Prior to delisting a supplier’s grocery product, the retailer must:
(a) provide reasonable written notice to the supplier of the
retailer’s decision to delist the product, including the reasons
for delisting; and
(b) inform the supplier of the supplier’s right to have the
decision to delist the product reviewed by the retailer’s senior
buyer for the supplier.
(6) Subclause (5) does not apply if:
(a) time is of the essence (including for product recalls,
withdrawals or safety issues); or
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Schedule 1 Food and Grocery Code of Conduct
Part 3 Conduct generally
Division 4 Other conduct
Clause 20
18 Competition and Consumer (Industry Codes—Food and Grocery)
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(b) there are persistent issues with supply that have resulted in
the retailer being out of stock or stocked at significantly
reduced levels.
(7) The retailer’s senior buyer for a supplier must, after receiving a
written request from the supplier, promptly review any decisions
regarding delisting made by the retailer and provide the supplier
with written notice of the outcome of that review including the
basis for the retailer’s decision.
(8) To avoid doubt, a decision by the retailer not to extend the
agreement, or enter into a new grocery supply agreement,
following the expiry of a fixed term grocery supply agreement is
not a decision to delist a product.
(9) In any dispute, the retailer has the onus of establishing the matters
in subclauses (1) and (6).
20 Funded promotions
(1) If a supplier agrees to make a payment in support of the promotion
of a product, the retailer may hold the promotion only after giving
the supplier reasonable written notice.
(2) If the retailer orders a grocery product from a supplier at a
promotional price (whether calculated by way of discount, rebate,
credit, allowance or otherwise), the retailer must:
(a) ensure that the basis on which the quantity of the order is
calculated is transparent; and
(b) not over-order; and
(c) if the retailer sells any over-ordered product other than at, or
below, the promotional resale price—pay the supplier the
difference between the supplier’s promotional price and the
supplier’s full price for the product.
(3) If the retailer has placed an order for a grocery product with a
supplier in connection with a promotion, the retailer must not do
either of the following without the supplier’s written consent:
(a) cancel the order;
(b) reduce the order by more than 10%.
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Food and Grocery Code of Conduct Schedule 1
Conduct generally Part 3
Other conduct Division 4
Clause 21
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Regulation 2015
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(4) Subclause (3) does not apply if:
(a) the retailer gives the supplier reasonable written notice of the
cancellation or reduction; or
(b) the retailer compensates the supplier for any net resulting
costs, losses or expenses incurred or suffered by the supplier
as a direct result of the retailer failing to give reasonable
notice of the cancellation or reduction.
21 Fresh produce standards and quality specifications
(1) The retailer must provide any fresh produce standards or quality
specifications to a supplier in clear, unambiguous and concise
written terms.
(2) The retailer must accept all fresh produce delivered in accordance
with relevant fresh produce standards and quality specifications.
(3) The retailer may reject fresh produce only if all of the following
conditions are satisfied:
(a) the produce fails to meet relevant fresh produce standards or
quality specifications;
(b) the retailer rejects the produce within 24 hours after the
produce is delivered to the retailer;
(c) the retailer does not reject the produce after the retailer has
accepted the produce.
(4) If the retailer rejects fresh produce because it does not meet
relevant fresh produce standards or quality specifications, the
retailer must provide written reasons for the rejection to the
supplier within 48 hours.
(5) The retailer must communicate any labelling, packaging or
preparation requirements for a grocery product to a supplier in
clear, unambiguous and concise written terms.
(6) The retailer must provide a supplier with reasonable written notice
of any required changes to packaging, labelling or preparation
standards (unless the change is required immediately by law)
taking into consideration existing stock held by suppliers (where
Federal Register of Legislative Instruments F2015L00242
Schedule 1 Food and Grocery Code of Conduct
Part 3 Conduct generally
Division 4 Other conduct
Clause 22
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No. 16, 2015
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known) and any agreement as to stock coverage in the relevant
grocery supply agreement.
(7) The retailer must make any claim for damaged grocery products or
shortfalls, or any similar claims, within a reasonable time of, and in
any event no later than 30 days after, delivery of the groceries to
the retailer (or its nominee).
Note: See also clause 8 (matters to be covered by agreement).
22 Changes to supply chain procedures
(1) The retailer must not directly or indirectly require a supplier to
make any material change to supply chain procedures during the
period of the grocery supply agreement concerned.
(2) Subclause (1) does not apply if:
(a) the retailer gives the supplier reasonable written notice of the
change; or
(b) the retailer compensates the supplier for any net resulting
costs, losses or expenses incurred or suffered by the supplier
as a direct result of the retailer failing to give reasonable
notice of the change.
(3) Paragraph (2)(b) does not prevent a supplier from waiving a right
to compensation under that paragraph.
(4) This clause has effect subject to clause 9 (unilateral variation of
agreement) and clause 10 (retrospective variation of agreement).
23 Business disruption
The retailer must not threaten a supplier with business disruption or
termination of a grocery supply agreement without reasonable
grounds.
24 Intellectual property rights
(1) The retailer must respect the intellectual property rights held by
suppliers in relation to grocery products, including intellectual
property rights in branding, packaging and advertising.
Federal Register of Legislative Instruments F2015L00242
Food and Grocery Code of Conduct Schedule 1
Conduct generally Part 3
Other conduct Division 4
Clause 25
No. 16, 2015 Competition and Consumer (Industry Codes—Food and Grocery)
Regulation 2015
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(2) To avoid doubt, subclause (1) does not create, confer or extend any
intellectual property rights in or of the supplier.
(3) In developing or producing own brand products, the retailer must
not infringe the intellectual property rights held by a supplier in
relation to grocery products, including rights relating to branding,
packaging designs or advertising.
(4) In any dispute relating to a breach of this clause, any relevant
actions of the supplier in relation to the intellectual property rights
of the retailer must be taken into account.
(5) In taking action under Division 2 of Part 5 (complaints), the retailer
may take into account any relevant actions of the supplier in
relation to the intellectual property rights of the retailer.
25 Confidential information
(1) This clause applies if a supplier discloses confidential information
to the retailer in connection with the supply of grocery products,
including confidential information relating to product
development, proposed promotions or pricing.
(2) The retailer must not use that information other than for a purpose
for which it was disclosed and may only disclose it or make it
available or accessible to employees or agents of the retailer who
need to have that information in connection with that purpose.
(3) The retailer must establish and monitor systems to ensure
compliance with subclause (2).
(4) To avoid doubt, information is not confidential information for the
purposes of this clause if the information:
(a) is publicly available; or
(b) comes into the possession or knowledge of the retailer:
(i) independently of the supplier; and
(ii) without any breach of subclause (2) on the part of the
retailer.
Federal Register of Legislative Instruments F2015L00242
Schedule 1 Food and Grocery Code of Conduct
Part 3 Conduct generally
Division 4 Other conduct
Clause 26
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No. 16, 2015
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26 Allocation of shelf space
(1) The retailer’s product ranging and shelf space allocation principles
must be published or provided to all suppliers with whom the
retailer has grocery supply agreements.
(2) The retailer must act in accordance with the principles and keep
them up to date.
(3) Within a reasonable time before conducting a range review, the
retailer must provide suppliers who might be affected by any
outcome of the review with clearly expressed written notice of:
(a) the purpose of the range review; and
(b) the key criteria governing ranging decisions.
(4) Following the range review, the retailer must provide affected
suppliers with a reasonable period of time to discuss the outcomes
of the review, including the basis for the retailer’s final decisions.
(5) The retailer must apply its product ranging and shelf space
allocation principles without discrimination (including without
discrimination in favour of its own brand products).
(6) This clause does not limit clause 19.
27 Transfer of intellectual property rights
(1) The retailer must not directly or indirectly require a supplier to
transfer or exclusively license any intellectual property right held
by the supplier in relation to a grocery product as a condition or
term of supply of an equivalent own brand product.
(2) Subclause (1) does not prevent the retailer from:
(a) holding an intellectual property right in an own brand
product; or
(b) having an exclusive right to the retail sale of an own brand
product; or
(c) making the holding of a right covered by paragraph (a) or (b)
by the retailer a condition or term of supply by the supplier of
Federal Register of Legislative Instruments F2015L00242
Food and Grocery Code of Conduct Schedule 1
Conduct generally Part 3
Other conduct Division 4
Clause 27
No. 16, 2015 Competition and Consumer (Industry Codes—Food and Grocery)
Regulation 2015
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an own brand product, to the extent the product, recipe or
formulation of the product:
(i) was developed or formulated by or for the retailer; or
(ii) is customised by or for the retailer.
Federal Register of Legislative Instruments F2015L00242
Schedule 1 Food and Grocery Code of Conduct
Part 4 Good faith etc.
Clause 28
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Part 4—Good faith etc.
28 Obligation to deal lawfully and in good faith
(1) The retailer or wholesaler must at all times deal with suppliers
lawfully and in good faith within the meaning of the unwritten law
as in force from time to time.
(2) The retailer or wholesaler must not enter into a grocery supply
agreement that contains a provision that limits or excludes the
obligation to act in good faith, and if it does, the provision has no
effect.
(3) In determining whether the retailer or wholesaler has acted in good
faith in dealing with a supplier, the following may be taken into
account:
(a) whether the retailer or wholesaler’s trading relationship with
the supplier has been conducted without duress;
(b) whether the retailer or wholesaler’s trading relationship with
the supplier has been conducted in recognition of the need for
certainty regarding the risks and costs of trading, particularly
in relation to production, delivery and payment;
(c) whether, in dealing with the retailer or wholesaler, the
supplier has acted in good faith.
(4) Subclause (3) does not limit subclause (1).
29 Freedom of association
(1) The retailer or wholesaler must not provide an inducement to
prevent a supplier from:
(a) forming an association of suppliers; or
(b) associating with other suppliers for a lawful purpose.
(2) The retailer or wholesaler must not discriminate, or take any other
action, against a supplier for:
(a) forming an association of suppliers; or
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Food and Grocery Code of Conduct Schedule 1
Good faith etc. Part 4
Clause 30
No. 16, 2015 Competition and Consumer (Industry Codes—Food and Grocery)
Regulation 2015
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(b) associating with other suppliers for a lawful purpose.
30 Provision of contact details
(1) The retailer or wholesaler must make available to its suppliers, and
keep updated:
(a) contact details of the retailer or wholesaler’s buyers and
senior buyers for the supplier; and
(b) contact details for the retailer or wholesaler’s code
compliance manager.
(2) The contact details must include position titles and contact
telephone numbers.
Federal Register of Legislative Instruments F2015L00242
Schedule 1 Food and Grocery Code of Conduct
Part 5 Dispute resolution
Division 1 Preliminary
Clause 31
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Part 5—Dispute resolution
Division 1—Preliminary
31 Information and documents
(1) The retailer or wholesaler is not required to comply with this Part
in relation to a complaint or dispute unless, at the time of making
the complaint or notifying the dispute to the retailer or wholesaler,
the supplier concerned provides, or offers to provide and is capable
of providing, information and documents in accordance with
subclause (2).
(2) The information and documents must provide sufficient particulars
of the following to enable the retailer or wholesaler to investigate,
consider and respond to the complaint or dispute:
(a) the complaint or dispute;
(b) the conduct that is the subject of the complaint or dispute;
(c) the provisions of this code that are alleged to have been
breached;
(d) the remedy or relief that the supplier is seeking.
Note: The supplier may supply any or all of the information or documents
subject to appropriate confidentiality protections.
(3) If the complaint relates to clause 9 (unilateral variation of
agreement) or 10 (retrospective variation of agreement), the
supplier provides sufficient particulars of the matters in paragraphs
2(a) and (b) if the supplier provides particulars of detriment that
has been, or will be, caused to the supplier.
32 Code compliance manager
(1) The retailer or wholesaler must nominate a person as the code
compliance manager for the retailer or wholesaler.
(2) The code compliance manager must:
(a) have access to:
Federal Register of Legislative Instruments F2015L00242
Food and Grocery Code of Conduct Schedule 1
Dispute resolution Part 5
Preliminary Division 1
Clause 32
No. 16, 2015 Competition and Consumer (Industry Codes—Food and Grocery)
Regulation 2015
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(i) the resources necessary to perform his or her functions;
and
(ii) all documentation relating to the retailer or wholesaler’s
obligations under this code; and
(iii) the retailer or wholesaler’s buying team for the purposes
of discussing issues relating to the retailer or
wholesaler’s obligations under this code; and
(b) be independent of, and not be managed by, any member of
the retailer or wholesaler’s buying team; and
(c) act in accordance with a written complaints handling
procedure that:
(i) has been developed by the retailer or wholesaler; and
(ii) has been provided to the Commission; and
(iii) is reviewed annually and updated as necessary.
Federal Register of Legislative Instruments F2015L00242
Schedule 1 Food and Grocery Code of Conduct
Part 5 Dispute resolution
Division 2 Complaints
Clause 33
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Regulation 2015
No. 16, 2015
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Division 2—Complaints
33 Referral of complaints
(1) A supplier may direct a complaint relating to a matter covered by
this code to the code compliance manager.
(2) The complaint must:
(a) be in writing; and
(b) include the following:
(i) the supplier’s identification details, including business
or trading name;
(ii) contact details for the supplier, or the person dealing
with the complaint on behalf of the supplier, including
the name, title and telephone number of that person;
(iii) details of the conduct giving rise to the complaint,
including the provision of this code relevant to the
complaint, together with any documents or other
information that would assist the investigation of the
complaint.
34 Immediate elevation of complaint
(1) The complaint may include a request for immediate elevation of
the complaint though senior levels of management.
(2) If the supplier makes such a request, the retailer or wholesaler must
elevate the complaint and attempt, within 20 business days, and in
good faith, to resolve the complaint.
35 Investigation by code compliance manager
(1) If the supplier does not request immediate elevation of the
complaint, the code compliance manager must take all reasonable
steps to:
(a) investigate the complaint; and
(b) conclude the investigation within 20 business days.
Federal Register of Legislative Instruments F2015L00242
Food and Grocery Code of Conduct Schedule 1
Dispute resolution Part 5
Complaints Division 2
Clause 36
No. 16, 2015 Competition and Consumer (Industry Codes—Food and Grocery)
Regulation 2015
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(2) Subclause (1) does not apply if the code compliance manager:
(a) is satisfied that the complaint is vexatious, trivial,
misconceived or lacking in substance; and
(b) gives the supplier written notice to that effect.
(3) However, if the complaint relates to clause 9 (unilateral variation
of agreement) or 10 (retrospective variation of agreement), the
code compliance manager must not be satisfied that the complaint
is vexatious, trivial, misconceived or lacking in substance only
because the supplier’s only ground in relation to the complaint is
detriment to the supplier.
(4) A notice under paragraph (2)(b) must set out:
(a) the compliance manager’s reasons for being satisfied that the
complaint is vexatious, trivial, misconceived or lacking in
substance; and
(b) that the supplier may take further action in relation to the
matter under clause 37 (internal review) or 38 (mediation or
arbitration).
36 Action following investigation
(1) Following the investigation, the code compliance manager must
determine what (if any) action should be taken in response to the
complaint.
(2) The code compliance manager must, within 5 business days after
the conclusion of the investigation, give the supplier a summary of
the action (if any) that has or will be taken in response to the
complaint and the timetable for any such action.
(3) The code compliance manager must keep the following for at least
6 years:
(a) a record of the complaint;
(b) a record of the investigations taken to investigate the
complaint;
(c) a summary of any action taken in response to the complaint.
Federal Register of Legislative Instruments F2015L00242
Schedule 1 Food and Grocery Code of Conduct
Part 5 Dispute resolution
Division 2 Complaints
Clause 37
30 Competition and Consumer (Industry Codes—Food and Grocery)
Regulation 2015
No. 16, 2015
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37 Internal review
(1) This clause applies if:
(a) the supplier did not request immediate elevation of the
complaint in accordance with clause 34; and
(b) the supplier:
(i) is satisfied that no action has been taken in relation to
the complaint; or
(ii) is not satisfied with the outcome of the investigation
into the complaint under that clause; or
(iii) has been given notice under paragraph 35(2)(b) to the
effect that the code compliance manager is satisfied that
the complaint is vexatious, trivial, misconceived or
lacking in substance; or
(iv) has not been given a summary of action taken in relation
to the complaint in accordance with subclause 36(2).
(2) The supplier may give the retailer or wholesaler a written request
to elevate the dispute though senior levels of management.
(3) The request must specify:
(a) the nature of the dispute; and
(b) the provision of this code relevant to the dispute; and
(c) the action that the supplier thinks will settle the dispute; and
(d) the outcome that the supplier is seeking.
(4) The retailer or wholesaler must elevate the dispute and attempt,
within 20 business days, and in good faith, to resolve the dispute.
Federal Register of Legislative Instruments F2015L00242
Food and Grocery Code of Conduct Schedule 1
Dispute resolution Part 5
Mediation and arbitration Division 3
Clause 38
No. 16, 2015 Competition and Consumer (Industry Codes—Food and Grocery)
Regulation 2015
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Division 3—Mediation and arbitration
38 Supplier may seek mediation or arbitration
(1) A supplier may seek either mediation or arbitration of a complaint
or dispute relating to a matter covered by this code.
(2) However, if the supplier has begun a process under Division 2
(complaints) in relation to the complaint or dispute, the supplier
must not seek mediation or arbitration of the complaint or dispute
until the process:
(a) has been completed; or
(b) should have been completed.
(3) The retailer or wholesaler:
(a) must take part in the mediation or arbitration in good faith;
but
(b) is not required by this code to take part in both mediation and
arbitration in relation to the same complaint or dispute at the
same time.
Note: See subclause 39(3) for when the retailer or wholesaler will be:
(a) taken to take part in the mediation or arbitration; and
(b) taken to be trying to resolve the dispute in good faith.
(4) In any dispute, the retailer or wholesaler has the onus of
establishing the matters in subclause (3).
(5) Despite paragraph (3)(a), the retailer or wholesaler is not required
to take part in the mediation or arbitration if the mediator considers
or the arbitrator determines that:
(a) the complaint or dispute is vexatious, trivial, misconceived or
lacking in substance; or
(b) the supplier is not acting in good faith.
(6) However, if the complaint or dispute relates to clause 9 (unilateral
variation of agreement) or 10 (retrospective variation of
agreement), the mediator or arbitrator must not consider or
determine that the complaint is vexatious, trivial, misconceived or
Federal Register of Legislative Instruments F2015L00242
Schedule 1 Food and Grocery Code of Conduct
Part 5 Dispute resolution
Division 3 Mediation and arbitration
Clause 39
32 Competition and Consumer (Industry Codes—Food and Grocery)
Regulation 2015
No. 16, 2015
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lacking in substance only because the supplier’s only ground in
relation to the complaint or dispute is detriment to the supplier.
39 Conduct of mediation and arbitration
(1) Mediation or arbitration for the purposes of this code must be
conducted in accordance with the rules of the Institute of
Arbitrators and Mediators Australia.
(2) If the mediator or arbitrator is not agreed by the parties within 10
business days of a supplier referring a matter, the mediator or
arbitrator must be appointed by the Institute of Arbitrators and
Mediators Australia in accordance with the rules of the Institute.
(3) For the purposes of paragraph 38(3)(a), the retailer or wholesaler:
(a) is taken to take part in the mediation or arbitration if the
retailer or wholesaler is represented at the mediation or
arbitration by a person who has authority to enter into an
agreement to settle the dispute on behalf of the retailer or
wholesaler; and
(b) is taken to be trying to resolve the dispute in good faith if the
retailer or wholesaler approaches the resolution of the dispute
in a reconciliatory manner, including by doing the following:
(i) attending and participating at meetings that are arranged
at reasonable times;
(ii) at the beginning of the mediation or arbitration process,
making it clear what the retailer or wholesaler is trying
to achieve through the mediation or arbitration;
(iii) observing any obligation relating to confidentiality that
applies during or after the mediation or arbitration
process;
(iv) not taking or refusing to take action during the dispute,
including refusing to accept goods or to make payments,
that has the purpose or effect of applying pressure to
resolve the dispute.
(4) All costs of any mediation or arbitration are to be determined under
the rules of the Institute of Arbitrators and Mediators Australia.
Federal Register of Legislative Instruments F2015L00242
Food and Grocery Code of Conduct Schedule 1
Dispute resolution Part 5
Mediation and arbitration Division 3
Clause 39
No. 16, 2015 Competition and Consumer (Industry Codes—Food and Grocery)
Regulation 2015
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(5) The Minister may, by legislative instrument, modify the operation
of this clause by substituting another body in place of the Institute
of Arbitrators and Mediators Australia.
Federal Register of Legislative Instruments F2015L00242
Schedule 1 Food and Grocery Code of Conduct
Part 6 Compliance and reporting
Clause 40
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Regulation 2015
No. 16, 2015
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Part 6—Compliance and reporting
40 Duty to train staff with respect to this code
(1) Within 6 months of being bound by this code, the retailer or
wholesaler must provide its buying team with:
(a) a copy of this code; and
(b) training on the requirements of this code.
(2) The retailer or wholesaler must provide any person who becomes
part of the retailer or wholesaler’s buying team after the retailer or
wholesaler is bound by this code with:
(a) a copy of this code; and
(b) training on the requirements of this code.
(3) The retailer or wholesaler must comply with subclause (2) within
20 business days after the person becomes part of the buying team.
(4) The retailer or wholesaler must provide annual retraining to its
buying team on the requirements of this code.
41 Reports by code compliance managers
(1) A code compliance manager must prepare a written report in
respect of each 6-month period beginning on 1 January and 1 July.
(2) The report must:
(a) be prepared within 30 business days after the end of the
period; and
(b) set out the following:
(i) the number of complaints received for investigation in
the reporting period;
(ii) in general terms and without identifying a
complainant—the nature of the complaints received;
(iii) the time taken to investigate each complaint;
(iv) the outcome of each investigation;
Federal Register of Legislative Instruments F2015L00242
Food and Grocery Code of Conduct Schedule 1
Compliance and reporting Part 6
Clause 42
No. 16, 2015 Competition and Consumer (Industry Codes—Food and Grocery)
Regulation 2015
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(v) whether or not each complaint was resolved to the
satisfaction of the complainant.
42 Keeping records
(1) The retailer or wholesaler must keep the original or a copy of each
grocery supply agreement to which the retailer or wholesaler is a
party while bound by this code (including any document
comprising the agreement, and any document made from time to
time under the agreement that forms part of the agreement):
(a) during the term of the agreement; and
(b) for 6 years after the agreement ends.
(2) The retailer or wholesaler must keep the original or a copy of each
of the following for at least 6 years from when the document is
made or given, as the case requires:
(a) an offer made under subclause 5(2) or 6(2) to vary a grocery
supply agreement;
(b) notice of variation of a grocery supply agreement given under
paragraph 9(2)(d) or 10(2)(d);
(c) notice of a decision to delist a product given under
paragraph 19(5)(a);
(d) notice of the outcome of the review of a decision to delist a
product given under subclause 19(7);
(e) reasons for rejection of fresh produce given under
subclause 21(4);
(f) notice of required changes to packaging, labelling or
preparation standards given under subclause 21(6);
(g) notice of material change to supply chain procedures given
under paragraph 22(2)(a);
(h) notice of a range review given under subclause 26(3);
(i) notice that a complaint is vexatious, trivial, misconceived or
lacking in substance given under paragraph 35(2)(b);
(j) a summary of action that has or will be taken in response to a
complaint and the timetable for the action given under
subclause 36(2);
Federal Register of Legislative Instruments F2015L00242
Schedule 1 Food and Grocery Code of Conduct
Part 6 Compliance and reporting
Clause 42
36 Competition and Consumer (Industry Codes—Food and Grocery)
Regulation 2015
No. 16, 2015
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(k) a code compliance manager’s report prepared under
subclause 41(1).
Federal Register of Legislative Instruments F2015L00242