Canada’s code of conduct complete, but is it enough?

Those who have drawn up Canada’s grocery code of conduct say it has teeth, but many in the industry are wondering if violators will only get a tongue lashing.

That might not be enough, and industry officials say fines need to be imposed if someone breaks the rules. A proposed final version, which includes a process to resolve disputes and impose sanctions on violators of the code, was recently completed. Bad behavior could be publicized, but there is no mention of monetary punishment.

The code is supposed to help the relationship between suppliers and grocers, and addresses issues including arbitrary fees, cost increases without proper notice and late payment.

Actions by Walmart Canada created the call to action. Back in 2020, the retailer announced it was imposing a fee hike with suppliers. Metro Inc. and Loblaw followed with their increases.

On March 27, Walmart Canada President and CEO Gonzalo Gebara was in front of the House of Commons expressing his desire to join other grocery retailers in the formation of the code of conduct.

A consultation process on the proposed code of conduct is open to food industry members until May 30.

Many in the industry believe the code creates a level playing field where large grocery retailers do not have any leverage on smaller grocers.

Related:Walmart Canada has change of heart regarding grocer code of conduct

The Retail Council of Canada is in favor of the proposed rules as long as it allows retailers to keep food prices competitive.