MILK retailers will have increased security for rounds but not full legal protection under Commerce and Employment Department proposals. The States will be asked to approve what the department called ‘a hybrid system’ of measures at the end of the month.
Commerce and Employment plans to scrap the system of licensing retailers in favour of registering and will leave retailers to settle most milk round issues themselves.
And it has rejected calls from the roundsmen to protect their routes from predators.
The department accepted that it is commercially sound for milk rounds to be based on geographical areas.
It recognises that the value of goodwill would be higher if it can be shown to be protected.
‘This issue, which the GMRA calls exclusivity, has been at the heart of discussions with the association,’ it said.
‘The department firmly believes that it is not the role of the States to intervene in such matters.
‘The market-based approach to the development of rounds, which has worked well over the years, should be allowed to continue without interference from the States.’
It accepted that the dairy had once been much more closely tied to retailers and as a result, the licensing system, which the department argues was merely ‘fit person’ approval of someone who had bought a milk round, was seen to carry a degree of protection that was not provided in law.
It wants to make it clear that ‘registered’ roundsmen will not be specifically linked to any geographical area - registration will merely grant them authority to distribute.
All issues surrounding milk rounds and rights to distribute should be agreed between
the retailers, the department said.
It accepted that the Scrutiny review showed there was a need for clarity about the dairy’s role in rounds and the assumption that they had legal protection.
The dairy has helped the Milk Retailers’ Association on round management issues in the past. It has also been invited to intervene on territorial disputes.
But the dairy management board had been seeking to distance itself from this for some years.
Its new board will consult with the retailers to set out a document clarifying its relationship between both sides.
The department is already clear, though, that it wants no part in territorial disputes, setting or protecting rounds or valuing them prior to sale.
In return it has clarified its trading position and agreed that it will not deliver milk to shops or permit the direct collection of milk by shops and will only supply roundsmen in commercial quantities.
Article posted on 7th April, 2007 - 12.00am
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