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Loblaw grocery code of conduct shift is ‘step in the right direction’: Trudeau

Click to play video: 'Loblaw will sign grocery code of conduct as long as competitors do too'
Loblaw will sign grocery code of conduct as long as competitors do too
WATCH: Canada’s biggest grocery chain, Loblaw, says it's ready to sign on to a grocery code of conduct. The agreement, years in the making, is aimed at levelling the playing field between larger grocers and smaller retailers in the food industry. However, as David Akin reports, there's no guarantee it'll lead to lower prices – May 17, 2024

Prime Minister Justin Trudeau says the willingness of grocery giant Loblaw to sign on to a code of conduct is a “big step in the right direction.”

“One of the issues is that Loblaws was one of the holdouts for this code of conduct,” Trudeau said on Friday during a press conference.

“The fact that Loblaws is now on board means that there’s a lot more chances that it’s going to move forward, which is what this government has been pushing for for a long time…. Seeing the groceries sign on to good, responsible behaviour towards Canadians that they profit from every single year, that’s a big step in the right direction.”

Click to play video: 'Business Matters: Loblaw and Walmart have refused to sign Canada’s grocery code of conduct, documents show'
Business Matters: Loblaw and Walmart have refused to sign Canada’s grocery code of conduct, documents show

Loblaw Cos. Ltd. said Thursday it’s ready to sign on to the grocery code of conduct, paving the way for an agreement that’s been long in the making.

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After six months of negotiations, Loblaw president and CEO Per Bank said the retailer is now ready to sign as long as other industry players do too.

“The code now is fair, and it will not lead to higher prices,” he said in an interview.

The code has been developed by a group of leaders in the food industry, with the intention of evening the playing field for suppliers and smaller retailers.

But it appeared to come to a halt last December when Loblaw and Walmart Canada said they wouldn’t sign the voluntary code, saying they were concerned it would raise prices for shoppers.

Nick Henn, Loblaw’s chief legal officer, said the underlying principles of the code haven’t changed.

“We felt that the words weren’t clear in lots of areas, and so we’ve spent some time with the working committee and the interim board, fixing those areas, improving the code and providing the clarity that we thought it lacked the last time around,” he said in the same interview alongside Bank with The Canadian Press.

One important example was regarding the dispute resolution process, Henn said.

Loblaw wanted to make clear when it would be appropriate for issues to go to an adjudicator, and when it wouldn’t — such as in the case of price negotiations between suppliers and retailers.

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June 1, 2025, is the target date for the code to take effect, Henn said.

–with files from The Canadian Press

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