CCPC To Begin Investigating Grocery Goods Sector

Author:Ms Kate McKenna
Profession:Matheson
 
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Summary

The Irish regulator has announced a strategic priority to use its powers to investigate whether retailers and wholesalers are complying with 2016 groceries regulations. Groceries businesses should therefore pay extra attention to the regulations and the prospect of investigation and / or prosecution.

The law

Large grocery goods retailers and wholesalers have obligations intended to ensure 'fair dealing' with suppliers under the Consumer Protection Act 2007 (Grocery Goods Undertakings) Regulations 2016 (the “Regulations”).

The Competition and Consumer Protection Commission (the “CCPC”) is responsible for monitoring compliance with the Regulations pro-actively and in response to complaints. A business found to be in breach of the Regulations may face prosecution, with potential penalties ranging from:

on a first summary conviction, a fine of up to €3,000 or six months imprisonment or both; to on a second or subsequent conviction on indictment, a fine of up to €100,000 or two years imprisonment or both. To date, the CCPC has not prosecuted under the Regulations. That looks set to change, however, with the CCPC identifying compliance with the Regulations as a priority in its recently published Annual Report; and with Chairperson Isolde Goggin recently stating that the CCPC is now “moving into an area of inspections” within the grocery goods sector.

The grocery goods sector is also a priority on the EU and Irish legislative agenda. A draft EU Directive on unfair trading practices was published by the EU Commission on 12 April 2018 and there has been an Irish public consultation on how to implement this EU legislation in Ireland (see Matheson response here once published). One possible change following new EU legislation is that the CCPC will have an additional power to impose an administrative fine on retailers and wholesalers for non-compliance.

Now is therefore an opportune time for retailers and wholesalers of grocery goods to carry out a compliance check and avoid facing investigation and / or penalties.

Reminder: What obligations are imposed by the Regulations?

(a) Have a written and signed contract in place: “Grocery goods” contracts must be recorded in writing using clear understandable language and must be signed and retained by each party.

(b) Force Majeure: Parties togrocery goods contracts shall not be liable...

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