ACCC announces alterations to dairy code of conduct guidance

One of the ACCC’s leaders says it’s keeping a close eye on the state of play ahead of the dairy price deadline of June 1.

Australia’s dairy code of conduct guidance has been finetuned by the competition watchdog for its third test at the farmgate.

The Australian Competition and Consumer Commission today announced an updated guidance to the mandatory dairy code, which came into effect in July 2020.

Further detail has been provided by the ACCC on how processors need to publish their milk supply agreements and when they can terminate an agreement with a farmer.

The updated rule book also informs processors about how they can comply with the “single document” requirement, and the meaning of a non-exclusive agreement under the code.

ACCC deputy chairman Mick Keogh. Picture: Adam Taylor

ACCC deputy chairman Mick Keogh said updated obligations reflected how the industry had adapted to the code.

“The code has been in place now for almost three full dairy seasons and, generally speaking, we have seen compliance continue to improve,” Mr Keogh said.

“However, we urge processors to remain vigilant.

“We want processors to familiarise themselves with our revised guidance so they are completely clear on their obligations under the code. For most processors this won’t require any major changes to current practices.”

Following the 2016 “clawback” of farmgate prices by Murray Goulburn and Fonterra, the federal government commissioned the ACCC with writing a new rule book on the relationship between farmers and processors.

One of the code’s main obligations is that processors publish milk supply agreements by 2pm on June 1 each year.

All milk supply agreements must include a 14-day cooling-off period under the code.

During this period a farmer can terminate the agreement without incurring any liability to the processor.

“We’ll be conducting further compliance checks following the publication of new milk supply agreements on June 1 to ensure processors are complying with the code,” Mr Keogh said.