Loblaw Companies, the last of two holdouts against adoption of the Canada Grocery Code of Conduct, has agreed to comply. The Code establishes fair and equitable relationships with suppliers including the elimination of “compliance fines” and coercion over pricing. The Code also establishes procedures for dispute resolution and requires negotiation in good faith with fair and ethical dealing.

The origin of the Code of Conduct is based on the realization among provincial and territorial Ministers of Agriculture that small and medium enterprises are at a disadvantage in dealing with the major chains with respect to contracts, transparency and pricing.  Problems were brought into focus during the COVID years with disruption in supply chains. 

Companies that resisted the Code of Conduct based their objections on unfounded projections of increases in the cost of food to consumers. Faced with the threat of legislation, Loblaw agreed to cooperate with the industry-administered program.  Michael Graydon, Chair of the Interim Board for the Code of Conduct, stated, “Within a very complex food system, the vision for the Code has always been based on a free inclusive, voluntary entity, developed by the grocery industry and managed by its stakeholders across the supply chain.”

Walmart surely will have to fall into line as the last holdout.