So much for being an “impotent bystander”.
Groceries Code Adjudicator Mark White has proved his critics wrong in the past few days with interventions against not one but two of the world’s biggest retailers. Both moves could have important implications for suppliers, as well as the future survival of GSCOP itself.
Amazon investigation
On Friday, the GCA announced he was launching an investigation into online giant Amazon over alleged delays in payments to suppliers, saying he had “reasonable grounds” to suspect Amazon had breached paragraph five of the Groceries Code covering delay in payments, with evidence from “a range of sources”.
The move comes in advance of the Adjudicator’s latest YouGov survey of retailer behaviour, indicating that Amazon is likely, once again, to feature prominently for all the wrong reasons.
The e-commerce and tech giant’s record in the survey is already shocking, having recorded the “worst-ever score” in 2023, the first time it was included since being brought under GSCOP. That low score was beaten just one year later, when fewer than half of suppliers said it complied with the code.
Since then Amazon has been trying to avoid an investigation – which could see the company fined 1% of its UK turnover – by proving it has taken the “swift and comprehensive” action White demanded, all while supplier allegations have continued to stack up.
White’s investigation – his first since he took over the role from Christine Tacon in 2020, and only the third in GCA history – represents a day some thought would never come.
Despite his tough talk a year ago, would the Adjudicator really have the nerve to take on the might of Amazon, despite it being a relative minnow in food sales terms? Those doubts only grew when he told The Grocer in January he was weighing up the cost and resources required for an investigation against more informal actions to improve the way it deals with suppliers.
Aldi delisting trial
Friday’s announcement was particularly notable, as just two days earlier The Grocer had revealed White would also be intervening in a landmark High Court hearing against Aldi, in a case with huge implications for suppliers.
Last week a judge ruled White should be allowed to advise on the evidence in the case, which pits the discounter against its former sprout and brassica suppliers. John Clappison and Matthew Rawson are suing Aldi for £3.7m, claiming they were forced out of business when orders were pulled, allegedly with insufficient notice.
In March, The Grocer revealed Aldi lawyers claimed White’s intervention would heap unnecessary complexity and costs on the trial and could be a “partisan” move. But White will now be allowed to have his say, with the case due to go to trial next April.
While Aldi strongly denies the claims, the move has the potential to influence how suppliers act in the future, potentially creating a new route via which the Adjudicator can influence the code.
And even if it doesn’t make it to trial, the Adjudicator’s actions counter the growing accusations that his post lacks the teeth needed to police the UK’s biggest retailers.
The GCA is no pushover
Earlier this month MPs debated exactly that issue in the House of Commons, with criticism flying over the Adjudicator’s alleged lack of power to intervene to stop retailers bullying farmers and other suppliers.
“If the GCA cannot investigate and robustly intervene to protect suppliers, producers and consumers… what’s the point of the GCA?” asked Labour MP Rebecca Long-Bailey, who was far from the only one making such remarks.
The BBC’s Tom Heap caustically described the Adjudicator as an “impotent umpire”, while last month The Grocer revealed the Department for Business & Trade (DBT) had launched its latest statutory review of the GCA, with ministers having openly questioned its ability to bring Amazon into line.
A spectacularly badly-timed piece on the organic farming site Wicked Leeks asked just last week if the GCA was fit for purpose, with the article published the day after the judge approved White’s role in the Aldi case and the day before he announced the Amazon investigation was full systems go.
Whatever happens next, White has succeeded in laying to rest claims about the virility of the Adjudicator’s office, at least for now.
Next comes the really hard bit. Amazon has told The Grocer it has taken a range of measures to improve how it treats suppliers, and is likely to use its full legal might to fight the case, whatever evidence emerges in the looming survey.
Likewise Aldi, having failed to thwart the GCA’s efforts to intervene in court, remains adamant it has done nothing wrong.
The GCA has proved it is no pushover. Jeff Bezos may not be changing his wedding venue from Venice to Bognor Regis just yet, but even such a titan as Amazon cannot shrug off the threat of such a huge fine. What the case will mean for suppliers in the future is what really counts.
Likewise with Aldi. And while the money at stake pales into significance compared to the possible fine facing Amazon, the prospect of the Adjudicator’s intervention effectively creating a test case in the High Court could have implications for suppliers for many years to come.
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