The group is urging that the retail ombudsman proposed by the Competition Commission (CC) to arbitrate on disputes under the new Groceries Supply Code of Practice (GSCOP), has sufficient authority to ensure this safety net for suppliers.

Jenny Ricks from ActionAid said to FoodProductionDaily.com that the big supermarkets pass on costs such as delayed payments and lead time for orders to their suppliers.

In order to ensure that all suppliers in the UK and abroad are treated fairly, the ombudsman should be able to deal with complaints from all suppliers no matter where they are located, said the group.

According to an article published in The Guardian, UK supermarket chain Asda wants its overseas suppliers excluded from the new code of practice.

Asda said in a statement that it "broadly" welcomes the extension of the code of practice to cover the majority of grocery retailers but looks "forward to understanding in greater detail the role of the ombudsman, who we believe should have consumers at the top of their agenda".

The CC had suggested that an ombudsman be appointed to arbitrate on disputes under the GSCOP, with the power to gather information following complaints from suppliers and primary producers and proactively investigate breaches of the GSCOP.

The report of Asda's reaction to the GSCOP and the company's statement are in response to a remedies statement issued by the CC, which asked for reactions to its proposals, following a two year review of the UK retail industry.

GSCOP

The GSCOP is intended to replace the current Code (SCOP) which the Guardian says "is widely thought to have failed to make any impact on trading terms."

The new Code will include much of what is already contained in the SCOP, will prohibit retrospective changes to agreed terms of supply and also require retailers to make further improvements to their dealing with suppliers.

This is to be achieved through the appointment of an in-house code compliance officer, keeping better record of contracts with suppliers and automatic notification to suppliers of contractual terms and their right to complain and seek arbitration of disputes.

The ombudsman would arbitrate such disputes.

The CC proposes that the GSCOP will be extended to include all grocery retailers with a UK turnover greater than £1 billion.

The CC is required to publish its final report by 8 May 2008.