In its final sitting week of the year, the Australian Labor Party has introduced its new food and grocery code of conduct to parliament.
The new code is mandatory and supermarkets could face multi-million dollar fines for breaching it.
It is part of the Treasury Laws Amendment (Fairer for Families and Farmers and Other Measures) Bill 2024.
Assistant Minister for Competition Andrew Leigh said the government's intention was for the penalties to principally apply to supermarkets.
"The bill will ensure penalties for treating suppliers poorly in breach of the code and not merely a cost of doing business," he said.
If it is passed in parliament, the new code will come into effect from April 1, 2025. (AAP)
Additional powers for Australia's watchdog
The new code is based on the 11 recommendations made earlier this year in the Food and Grocery Code of Conduct Review done by former Labor Minister Craig Emerson.
If it is passed in parliament the new code will come into effect from April 1, 2025.
Mr Leigh said the new penalties were the highest corporate penalties under any industry code.
The maximum penalty in the code will be the greater of $10 million, three times the value of the benefit gained from the contravening conduct, or 10 per cent of turnover in the preceding 12 months.
Mr Leigh said the new penalties would allow Australia's watchdog, the Australian Competition and Consumer Commission (ACCC), to issue infringement notices if it had reasonable grounds to believe a supermarket was in breach.
Suppliers will be able to make anonymous complaints under the new code. (ABC Rural: Jessica Schremmer)
Also in the bill, the ACCC will be notified of every merger in the supermarket sector and will be provided with $30 million in funding to crack down on deceptive pricing practices.
Further,an anonymous supplier and whistleblower complaints pathway will be established through the ACCC.
Mr Leigh said Australians would be able to make timely price comparisons as they planned to strengthen the unit pricing code.
A unit price shows how much the product costs using a standard measurement like weight.
"We're cracking down on shrinkflation," he said.
Code a 'joke'
New South Wales' Member for Calare Andrew Gee spoke in opposition of the new code in parliament.
He said "the major players" were already signed up and making it mandatory would not make a difference.
"The food and grocery Code of conduct is not worth the paper it's written on," he said.
"It has not stopped the price gouging and it has not stopped the damage that is being inflicted on farmers and consumers all around our country."
The debate on the bill was adjourned on Wednesday afternoon until Thursday, the final sitting date for the House of Representatives.