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Grocery code of conduct ‘will not work’ without Loblaw and Walmart, MPs told

Canada’s long-planned grocery code of conduct “will not work” without the cooperation of big grocery chains, like Loblaw and Walmart, MPs were told by industry experts at a parliamentary committee meeting.

In its current state, both Loblaw and Walmart Canada have so far refused to sign on to the code that has been in development since fall 2021 and focused on “promoting fair trading practices within the grocery sector,” creating an impasse to roll out the code planned for launch this year.

Speaking at a meeting of the Standing Committee on Agriculture and Agri-Food Tuesday, one food industry expert said it would be better “not to have a code if Loblaw and Walmart won’t be participating.”

“In my opinion, there is no debate,” said Sylvain Charlebois, food researcher and Dalhousie University Agri-Food Analytics Lab director.

“The code will not work without the mandatory participation of all the players in the industry,” he told MPs in French, adding that the code is a crucial step for achieving long-term food price stability.

“I can’t see this code working without Loblaw and Walmart,” Charlebois added.

This comes as grocery food prices rose 4.7 per cent year annually in December, the same pace reported the previous month, according to Statistics Canada data released in January.

In December, Loblaw chair Galen G. Weston and Walmart Canada CEO Gonzalo Gebara said that they aren’t open to signing the code in its current form, saying it would drive up costs.

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Weston said that Loblaw estimates the code will add $1 billion in costs to the supply line, which will be passed along to consumers.

Gebara did not give MPs a value estimate like Weston but said added bureaucracy will increase costs that have to be passed to consumers.

On Tuesday, the president and CEO of the Retail Council of Canada (RCC) said some big companies in the industry have raised concerns around some elements of the current state of code and the council is “working very hard” to respond to them. The RCC is a non-profit association that represents retailers including Canadian grocers.

“Creating a grocery store code of conduct led by the industry is a colossal task,” said RCC president Diane J. Brisebois during the committee meeting.

“There’s a lot of work that remains to be done.”

Brisebois said in developing the code, the retail council needs to ensure that there are “no unintended consequence,” but she said the council remains hopeful that it will be able to launch the code “at some in in 2024.”

“We continue to be optimistic that that will be the case.”

Committee chair and Liberal MP Kody Blois asked Brisebois whether large multinationals might be exempt from the grocery code and the focus of implementation be on small and medium sized businesses.

“We’re not at a stage …. where we would exclude anybody, but that may be a discussion we should consider,” Brisebois responded.

The Canadian Federation of Agriculture is among those calling for the implementation of the grocery code of conduct, saying “it works for all parties” and is “good for the economy.”

“The concept of a code of conduct is appealing to farmers so that we have the security, the transparency and the good business accolades through the entire supply chain,” federation president Keith Currie told MPs on Tuesday.

— with files from Global News’ David Baxter 

&copy 2024 Global News, a division of Corus Entertainment Inc.


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