Elaine Watson
Six months after the code of practice became legally binding, not a single complaint has been lodged against any of the top four multiples, the OFT has revealed.
Far from seeing this as evidence that the code has kept over-zealous buyers in check, suppliers claim the resounding silence merely proves the document, which cost the taxpayer and the trade more than £23m, is "a complete irrelevance". Coercive and abusive business practices have "simply carried on as before".
Moreover, controversial retailer-led initiatives such as factory gate pricing and online auctions are not covered by the code, said one major own label supplier. "In its current form it's a complete waste of time."
One national account manager said: "It doesn't surprise me in the slightest that no one has complained. As soon as you put your head above the parapet, that's a nail in your coffin. If anything, things have got worse."
Instead of putting everything down on paper, as the code stipulates, buyers are conducting more and more business verbally, said another account manager.
"The single worst practice in my experience is deducting money from supplier payments. You are then left to try to recover this money, which has been taken off without warning, as a contribution for advertising, for example.
"Not only can this really jeopardise your cash flow situation, but you don't always get it back," he said.
A key gripe was the code's vague terminology which relies heavily on subjective phrases such as "reasonable notice" or "in good faith," suppliers claimed.
However, Farming and Food Commission chairman Sir Don Curry said the fact that there had been no official complaints was not necessarily a bad sign. He said: "The code was designed to prevent bad practice in the first place. Making an official complaint or going to mediation is the last resort."
A group set up to implement the government's policy in response to the Curry report will take informal soundings from suppliers and retailers on the code, said Sir Don. The group will be set up in late autumn, when the government publishes its response to his report. Members are likely to include a cross-section of industry figures, headed by Sir Don, with a secretariat from government.
"The code is a good thing in principle," said Sir Don. "Whether it's correctly drafted is another matter. Suppliers should relay their concerns to the Office of Fair Trading, so that the code can be improved in the event of a review. "
The NFU said it was trying to define what constituted "reasonable notice" for changing the terms of a contract across the different agricultural sectors, to give the code more teeth.
Marketing director Robin Tapper said: "If the agricultural cycle is two years, changing the contract after three months is not reasonable. As it stands, this is not a very useful document."

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