All of Canada’s major grocery retailers are now willing to accept the terms of a grocery code of conduct that would establish rules to stabilize the relationship between suppliers and retailers.

The code has been in development for many years, in part to level the playing field and help smaller grocers compete more fairly. And though policymakers have emphasized its importance in stabilizing grocery prices, the code makes no commitments to consumers and no mention of prices.

Loblaws and Walmart had been opposed to the code, as constructed, when asked to testify to the House Committee in December. Other grocers found the code acceptable, provided everyone agreed to its terms.

After some revisions to the code, Loblaws announced it was prepared to endorse the code in May, leaving Walmart as the final holdout.

At a meeting of federal, provincial and territorial agriculture ministers in Whitehorse on July 18, the ministers announced that all five major retailers – Empire (Sobeys), Metro, Costco, Loblaw and Walmart – had agreed to sign the code.

The ministers’ release emphasized the “fairness, transparency and predictability to Canada’s grocery supply chain and for consumers” the code would produce.

Target implementation is June 2025. Officials added that key suppliers and regional as well as local independent grocers had also agreed to the code.

Michael Graydon, chairman of the interim board responsible for the code, told the Canadian Press: “It kind of was an all-or-none situation. And I think they all respected that and came to the table.”

When some chains balked at the code in 2023, there was talk that its adoption could become mandatory. Had the process been legislated, it might have taken months or years, because of the number of steps required to pass the law and regulations, establish enforcement and penalties, and secure similar changes in provincial laws across Canada.

The code’s origins were to establish a more consistent ‘rulebook’ between suppliers and retailers. Smaller retailers felt they were consistently disadvantaged because larger retailers could demand cost concessions from suppliers, and could also put penalties into contracts that effectively gave priority to larger retailers over smaller ones. More aggressive retailer demands about fees for shelf placement also irked suppliers.

Supply chain disruptions during the COVID-19 pandemic added to the plight of smaller retailers.