New Grocery Goods Sector Regulations Signed Into Law

Regulations have been signed into law governing certain practices in the grocery goods sector, the Minister for Jobs, Enterprise and Innovation, Richard Bruton, has announced.

The regulations aim to rebalance relationships between different players in the grocery goods sector, and ensuring that dealings in the sector are fair and sustainable and operate in the interests of jobs, consumers and sustainable safe food.

Among the areas covered by the regulations, which cover food and drink products, are:

• Grocery goods contracts will be required to be in writing

• Contracts cannot be varied or terminated except with express consent of both parties

• Suppliers cannot be obliged to obtain goods/services from a third party from whom a retailer/wholesaler receives payment for this arrangement

• Provisions to deal with ‘force majeure’, non-performance due to circumstances beyond the parties’ reasonable control

• Suppliers can require retailer/wholesaler to provide forecast of the goods that will be needed

• Prohibition on suppliers being required to pay for stocking/listing goods; for promotion; for marketing costs; for better positioning on shelves; for advertising; for wastage; for shrinkage – except in strictly specified circumstances, based on free agreement between the parties, based on written contract, and based on an objectivement measurement of costs born by the retailer/wholesaler

• Suppliers must be paid for goods within 30 days

• Measures to ensure compliance by retailers/wholesalers, including – requirement that staff be designated and trained as responsible for compliance; requirement for retailers/wholesalers to submit an annual compliance statement; requirement for records to be retained by each retailer/wholesaler

"In 2014, through the Competition and Consumer Protection Act, powers were provided to introduce strong regulations to govern relationships in this area," Minister Bruton said.

There is potentially a real inequality between these players which can be abused in a manner that is not in the interests of jobs, consumers or sustainable safe food. I am now signing an initial set of regulations into law which delivers on the Government’s commitment in the Programme for Government and will guard against abuse. These regulations will focus on food and drink, which have clearly been the products on which there has been most concern expressed.

"Relationships will continue to be based on commerce and prices will continue to be set by hard negotiations – this is in the interests of consumers. However new legal provisions will require that in future, contracts must be in writing, certain terms must be included, records must be retained for inspection and a compliance statement must be made. These measures together with strong enforcement powers will ensure that these relationships are fair and sustainable."

(MH/CD)