24Payments for wastage

24 Payments for wastage

(1) A large grocery business must not directly or indirectly require a supplier to make any payment to cover any grocery product that becomes unfit for sale at the premises of: (a) the large grocery business; or (b) a contractor or agent of the large grocery business; or (c) any other entity that is a retailer or wholesaler.

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) Subsection (1) does not apply if: (a) the relevant grocery supply agreement includes a provision that sets out expressly and unambiguously: (i) the circumstances, which could include negligence of the supplier, in which the supplier will be required to make payments to compensate the large grocery business for grocery products supplied by the supplier that become unfit for sale at the premises of a person or entity referred to in subsection (1); and (ii) the basis of the payments; and (b) that provision of the agreement is an allowable contrary provision; and (c) the grocery products become unfit for sale in such circumstances; and (d) each such payment is made in accordance with the agreement; and (e) each such payment is reasonable in the circumstances; and (f) the large grocery business takes reasonable steps to mitigate those costs. (3) For the purposes of (but without limiting) paragraph (2)(e), in determining whether a payment 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 payment is for a purpose that benefits both the supplier and the large grocery business. (4) A large grocery business that wishes to rely on subsection (2) must prove the matters in that subsection on the balance of probabilities (except in relation to whether the payment causes detriment to a supplier for the purposes of paragraph (2)(e)). (5) If: (a) the relevant grocery supply agreement provides for the supplier to make payments to cover grocery products that become unfit for sale at the premises of a person or entity referred to in subsection (1); and (b) the supplier seeks to negotiate a variation of the agreement relating to payments of that kind; the large grocery business must not, in the course of the negotiations or as a precondition to entering into the negotiations, seek to negotiate other variations of the agreement unrelated to payments of that kind.

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.