2nd Mar 2005 11:15
Office of Fair Trading02 March 2005 39/05 2 March 2005 OFT URGES SUPERMARKET CODE DISPUTE RESOLUTION Sainsbury's move welcomed The OFT welcomes that J Sainsbury plc is writing to suppliers in dispute overnew payment terms about flexibility in their implementation. Where suppliers andsupermarkets cannot resolve disputes by negotiation, the OFT encourages use ofthe mediation procedures in the Supermarket Code (see notes). In January Sainsbury's wrote to a large number of its suppliers to say that itspayment terms would be changed as from 7 March. The Fresh Produce Consortium(FPC) and the National Farmers Union (NFU), on behalf of supplier members,raised the matter with the OFT. The OFT has today written to the FPC and the NFU. The OFT welcomesthat Sainsbury's is writing to those suppliers in dispute over the new terms tosay that pending dispute resolution they will not implement the new terms on 7March. Where dispute is not resolved, the Supermarket Code provides formediation procedures, to which Sainsbury's is also drawing suppliers' attention.The OFT would encourage suppliers who believe that a dispute has not beeneffectively resolved to use the mediation process. The OFT has taken no view as to whether Sainsbury's changes in termswould breach the Code. The OFT is however concerned to see that disputes betweensuppliers and supermarkets are fairly and effectively resolved - if not bynegotiation then by mediation. Last year the OFT commissioned an independent audit of supermarkets'compliance with the Code (see PN 28/04). This will be published with an OFTstatement in the next few weeks. NOTES 1. The Supermarket Code of Practice ('the Code') (see http://www.dti.gov.uk/ccp/topics2/pdf2/codeofpractice.pdf) forms part of statutoryundertakings given to the Secretary of State for Trade and Industry undersection 88(2) of the Fair Trading Act 1973 following the Competition Commissionreport on the supply of groceries from multiple stores in the United Kingdompublished in October 2000 ('the 2000 CC report'). 2. The 2000 CC report recommended that any supermarket meeting the eightper cent of grocery purchases criterion should be required to give undertakingsto comply with the Code. Undertakings were given by Asda, Safeway, Sainsbury andTesco which each met the eight per cent criterion. While Safeway was subject tothe Code, Morrison was not prior to its acquisition of Safeway. Morrison hassubsequently agreed to abide by the Code. MEDIA enquiries: 020 7211+ Rachel Clark 8899 Julia Smith 8898Roger Hislop 8133 Kate Wilcox 8901Mark Kram 8900 Mike Ricketts [email protected] Out of hours: mobile: 07774 134814 messages: 020 7211 8961Copies of press notices: Ext. 8993http://www.oft.gov.uk PUBLIC enquiries: 0845 7224499 [email protected] reports and consumer information leaflets are available free from:OFT, PO Box 366, Hayes UB3 1XB 0800 389 3158 [email protected] This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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