The New Zealand government has introduced a “Grocery Code of Conduct” aimed at ensuring fair conditions for supermarket suppliers. The Grocery Commission will oversee the implementation and enforcement of these new regulations.
Commerce and Consumer Affairs Minister Duncan Webb stated that the major supermarket chains have not been treating local suppliers fairly and have taken advantage of their dominance by imposing unreasonable terms and conditions. The new regulations will require companies to use plain English in supply contracts, pay suppliers on time, and engage in negotiations in “good faith.”
Penalties for violations of these new rules could include the greater of 3% of turnover or $3 million for companies and fines of up to $200,000 for individuals. The code will initially apply to the two major supermarket chains, Woolworths and Foodstuffs, and will come into effect on September 28.
The government’s goal is to create a more equitable environment for consumers and suppliers and promote competition in the supermarket sector.
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