Public consultation on draft grocery regulations for Ireland
The Department of Jobs, Enterprise and Innovation is accepting written submissions until Friday 27 February 2015
Print10 February 2015
The Department of Jobs, Enterprise and Innovation is running a public consultation on draft regulations including new rules for commercial arrangements between certain grocery businesses that are active in Ireland. This will impose a number of new obligations on the grocery sector. The Department is accepting written submissions until Friday 27 February 2015.
The draft regulations are to be issued under the Competition and Consumer Protection Act 2014 and only apply to large businesses in the food and drink sector. A large business refers to every manufacturer, distributor and retailer of a food or drink product that is active in Ireland with a turnover of at least €50 million.
This scope of regulation is wide, in particular by comparison to the equivalent UK regime which applies only to ten named retailers. For example, the draft regulations would apply to a small food supplier that is active in Ireland and is owned by a large non-grocery business.
The draft regulations impose a large number of new obligations, such as adhering to a prescribed ‘form of contract’ including certain terms in written supply contracts; following certain procedures for contract changes; appointing a compliance officer; delivering staff training and submitting an annual compliance report to the Competition and Consumer Protection Commission (CCPC).
The draft regulations impose more extensive obligations on retailers, including rules on the circumstances in which suppliers can be required to make payments towards shrinkage, marketing and promotional costs. These retailer-specific obligations apply regardless of the size of the supplier.
Any grocery regulations that are issued will be supported by strong enforcement powers. Under the Act, the CCPC has power to investigate compliance, to issue compliance notices, and to ‘name and shame’ those in breach of the regulations. Certain elements of the draft regulations are specified to be ‘penal’. A breach of a compliance order or a ‘penal’ regulation carries serious, criminal sanctions, including court-imposed fines of up to €100,000 and 24 months’ imprisonment.
Helen Kelly EU, Competition and Regulatory from Matheson advises businesses to consider responding to the upcoming public consultation process and, consider whether your business could respond to the Department’s request for an estimate for the likely costs / administrative burdens arising from the draft regulations.
According to Dr. Vincent Power, partner in A&L Goodbody and head of the Firm’s EU and Compliance Group the new regulations would impact on every area of a business operating in the sector including financial, marketing, sales, packaging, compliance and delivery and logistics.
“Between now and the 27th of February, the Irish grocery sector has a unique opportunity to influence the new grocery goods regulations by making submissions on the proposed regulations, as requested by the Minister. Businesses operating in the sector should consider making submissions as it is always useful to influence and shape new laws before they are adopted,” said Dr Power.
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