Extending the remit of the Supermarkets Code of Practice to cover wholesalers and independents would be counterproductive, it has been claimed.
The measure was proposed by the Competition Commission in its provisional findings in the groceries inquiry. It suggested extending the code to cover any buyer who could potentially impose buying power over a supplier.
But Parfett's Cash & Carry MD Steve Parfett, who is also part of the FWD's delegation to the Competition Commission, said a sweeping extension of the code would be "illogical." Suppliers might be inclined to flag up concerns with customers who could exercise little or no buying power while remaining afraid to report abuses by larger customers, he said.
This, in turn, could give the impression the code was working. Because suppliers were coming forward, the real problem of supermarket power identified when the code was set up was not being tackled, so suppliers would end up with no more protection.
The FWD and ACS have resolved to fight the proposal as the commission prepares to consult on potential remedies. It has also proposed toughening the code. But Parfett said he did not think this would change how supermarkets dealt with suppliers.
"In 2000 the commission negotiated with multiples on the content of the code, and the retailers ran rings round it," he said. "The same thing will happen again. It's all about an imbalance of resources. The stronger party will get most of what it wants."