Suppliers attack dispute guidelines

14 February 2002
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14 February 2002 | Robin Parker

UK suppliers have attacked proposals to change guidelines for conflict resolution with supermarkets just weeks before their introduction.

In its first report, the Policy Commission on the Future of Farming and Food says a central independent mediation service, co-ordinated by the Institute of Grocery Distribution (IGD), should be set up to moderate automatically in all disputes.

But John Noble, director of suppliers' trade body the British Brands Group, said the IGD is biased towards supermarkets.

The code will be imposed on 17 March, 18 months after the Competition Commission proposed guidelines to stop retailers holding suppliers in what Tony Blair called an "armlock".

Supermarkets, after consulting suppliers, must appoint independent mediators, such as the Centre for Effective Dispute Resolution, after 90 days of "good faith" disputes.

The code has already been attacked by suppliers, who say it fails to define the "reasonable" behaviour expected of supermarkets.

Now suppliers say that the latest proposals will be even more unfair.

Noble said: "It's a retrograde move. The IGD has a good track record, but it's not truly independent, as it is supposed to represent supermarkets and suppliers, but actually tends to be biased towards retailers."

But Kevin Hawkins, Safeway's director of communications and chairman of the British Retail Consortium food committee, said a central body would smooth the "ad hoc" mediation process.

The commission, set up within the Department for Environment, Food and Rural Affairs last August to advise on creating a sustainable farming and food industry, also calls for a radical shift in farmers' subsidies from direct payments for food production to environmental schemes.

The proposal comes as Tesco begins talks with farmers threatening blockades of the its depots.

The government will announce in July which of the commission's proposals will be adopted.

SMfeb2002

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