On 25 March 2020, the Coronavirus Act 2020 (the Act) received Royal Assent. The Act gives the UK Government greater powers in a number of areas to enable it to better respond to the Coronavirus pandemic.
What does the Act say about food supply chains?
Information on food supply disruption is currently provided by the industry on a voluntary basis to UK Government authorities including the Department for Environment, Food and Rural Affairs (DEFRA).
Sections 25 to 29 of the Act introduce new powers that allow the UK Government to request information from the UK food supply chain. The purpose of these provisions is to enable the Government to gather sufficient information to allow it to plan for and respond to food supply disruption.
What are the new powers?
The Act allows an appropriate authority (i.e. Secretary of State, a Scottish Minister, a Welsh Minister and the Department of Agriculture, Environment and Rural Affairs in Northern Ireland) (Authority) to require a person in the food supply chain to provide relevant information about matters connected with a food supply chain. The information can only be requested:
- to establish whether the whole or part of a food supply chain is being disrupted or is at risk of disruption; and
- where an Authority believes a food supply chain is being disrupted or is at risk of disruption, to determine the nature of the disruption.
The Authority must have previously requested the information and either it was not provided, or the information given was false or materially misleading.
All requests for information must be made in writing and must specify how the information is to be delivered.
Who will be required to provide information under the new powers?
The Act applies to any person in the food supply chain or closely connected to it in England, Wales, Scotland and Northern Ireland. The definition of food supply chain is wide-ranging in order to capture businesses at every point along a food supply chain before the product reaches the consumer. This includes not only those that are directly involved in the food supply chain (e.g. producers, distributors or retailers) but also those that are 'closely connected' with a food supply chain including businesses who supply seeds, equipment or fertilisers and logistics and delivery businesses. The powers cannot be imposed on an individual, such as an individual farmer or other sole trader.
What are the penalties if a business fails to comply?
Failure to comply with a request for information can result in a fine of up to 1% of a business's annual turnover. If payment is not made within 28 days the fine can be increased by 50%.
Will there be an immediate change to how information is requested?
No. DEFRA intends to continue to request information on a voluntary basis from the industry. As part of the UK Government's Covid-19 response, touch points between food supply trade associations and relevant Government authorities have been stepped up and a data sharing protocol is already in place with food retailers to regularly gather information. It is hoped that the information obtained through these methods will be sufficient to enable the UK Government to effectively support an industry-led response to any food supply disruption resulting from Covid-19. The powers in the Act are only intended to be used as a last resort i.e. if information is not forthcoming when requested or is false or materially misleading.
Should you wish to discuss these provisions in more detail, please reach out to one of the team below.