22Payments to suppliers

22 Payments to suppliers

(1) A large grocery business must pay a supplier for all grocery products delivered and accepted in accordance with a grocery supply agreement: (a) within the time frame set out in the agreement; and (b) in any case—within a reasonable time after receiving the supplier’s invoice for the products.

Civil penalty:

(a) for a contravention by a body corporate—3,200 penalty units; or
(b) for a contravention by a person who is not a body corporate—640 penalty units.

(2) The large grocery business must not: (a) set off any amount against a supplier’s invoice or remittance unless the supplier has consented in writing to the set‑off of the amount; or (b) require a supplier to consent to set off such an amount.

Civil penalty:

(a) for a contravention by a body corporate—3,200 penalty units; or
(b) for a contravention by a person who is not a body corporate—640 penalty units.

(3) Subsection (2) does not apply if: (a) the grocery supply agreement includes a provision that provides for the amount to be set off; and (b) that provision of the agreement is an allowable contrary provision; and (c) the set‑off is made in accordance with the agreement; and (d) the set‑off is reasonable in the circumstances. (4) For the purposes of (but without limiting) paragraph (3)(d), in determining whether the set‑off is reasonable in the circumstances, regard must be had to: (a) the benefits, costs and risks (if any) for the supplier and for the large grocery business; and (b) whether the set‑off is for a purpose that benefits both the supplier and the large grocery business. (5) A large grocery business that wishes to rely on subsection (3) must prove the matters in that subsection on the balance of probabilities (except in relation to whether the set‑off causes detriment to a supplier for the purposes of paragraph (3)(d)).