Groceries Code Adjudicator

Presentation to the OECD

Food Chain Analysis Network Meeting

14 October 2014

Why and how the GCA was set up?

• GCA set up following a Competition Commission

report (in 2008) which found:

• In the hope of gaining a competitive advantage,

grocery retailers transfer excessive risks or

unexpected costs to their suppliers, which is likely

to lessen suppliers’ incentives to invest in new

capacity, products and production processes.

• If unchecked, the CC concluded that these

practices will ultimately have a detrimental effect

on consumers.

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How does the GCA work in practice?

• The CC recommended the a Groceries Supply Code

of Practice (GSCOP), but this does not cover price

agreements between retailers and direct suppliers

• CC wanted retailers to establish a GSCOP

Ombudsman to monitor and enforce compliance

• Agreement wasn’t reached, so CC recommended that

Government should set up an Adjudicator

• Government passed the GCA Act in 2013 to

introduce the GCA with statutory powers to

enforce GSCOP, arbitrate and investigate

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How does the GCA work in practice?

• The GCA is independent of the UK Government

• The GCA is separate from the UK’s national

competition authority (the CMA), but any changes to

the GSCOP remain the responsibility of the CMA

• GCA is wholly funded by a levy on the 10 largest

supermarkets. Total levy for 2015/16 = £1.1 million.

• GCA works part-time 3days per week; and has a small

staff (of about 7, including the GCA herself).

• GCA has a duty to ensure confidentiality

• GCA’s performance in meeting its statutory functions

will be reviewed in 2016

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GCA – Retailers in Scope

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GCA – Summary

• Groceries (Supply Chain Practices) Market Investigation

Order 2009 issued by the CC following its investigation. This

has two elements:

• The Framework – which specifies, inter alia, which retailers

are in scope and their compliance obligations. The CMA is

responsible form any changes to this framework.

• The Code – which specifies the various practices prohibited

between retailers and their direct suppliers. This does not

cover price-setting issues. The GCA administers the Code.

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