The Groceries Code Adjudicator will be given powers to fine supermarkets who deal with suppliers unfairly or unlawfully, the government announced today.

Competition minister Jo Swinson said the government had listened to the concerns from stakeholders who had campaigned for such powers to protect suppliers from unfair treatment.

If the Adjudicator finds that retailers are breaching the Groceries Code, he or she will be able to apply a range of sanctions. In most cases this would consist of recommendations or ‘naming and shaming’, but also a fine if the breach is considered serious enough.

Swinson said: “We have heard the views of the stakeholders who were keen to give the Adjudicator a power to fine, and recognise that this change would give the Adjudicator more teeth to enforce the Groceries Code.

“We expect fines to be used as a last resort, but the fact that the Adjudicator has the power to impose them will send a strong message to retailers that compliance with the Code is not optional. I am confident that these changes will mean that the Adjudicator is able to ensure fair play in the food supply chain and keep the industry growing.” 

The Adjudicator will publish guidance within six months after the Bill comes into effect to propose the maximum amount he or she will be able to fine. Retailers would have a full right of appeal against any fines imposed. 

The Groceries Code Adjudicator is being established to enforce the Groceries Code after the Competition Commission identified competition issues in its 2008 market study.