DEPARTMENT FOR
BUSINESS, ENTERPRISE AND REGULATORY REFORM News Release (2008/156)
issued by The Government News Network on 29 July 2008
The Government has
today published its response to the Competition Commission's
(CC) inquiry into UK groceries retailing.
The CC concluded that in many respects UK retailers are
delivering a good deal for consumers, but action was needed to
improve competition in local markets and to improve relationships
between retailers and their suppliers.
The CC has the powers to implement the majority of the measures
it identified, but put the following recommendations to Government:
- Introduce a 'competition test' in planning decisions
on larger grocery stores - The Government will reflect further on
this recommendation following the CLG consultation on revisions to
town centre planning policy and the conclusion of the legal
challenge launched by TESCO on 30 June. It does not want to
prejudge the outcome of this appeal
- Take action to prevent land agreements which can restrict entry
by competitors;
- The Government will consult on this later this year
-
Establish an independent Ombudsman to oversee a strengthened
Groceries Supply Code of Practice (if the CC cannot get voluntary agreement)
- The Government notes that the CC will engage with large grocery
retailers to implement this recommendation. If it cannot get
agreement the Government will consider establishing the ombudsman
itself. The Government would make any assessment based primarily
on what would be in consumers' best interests
Consumer Affairs Minister, Gareth Thomas said:
"I thank the Competition Commission for such an extensive
and thorough investigation. Many of the measures they have
identified will benefit consumers and I hope that they can
implement them quickly.
"Further work, dialogue and consultation will take place on
the recommendations put to Government."
Notes for editors
1. Under the Enterprise Act 2002 the OFT can make a market
investigation reference to the CC if it has reasonable grounds for
suspecting that competition is not working effectively in that market.
2. The grocery market was referred by the OFT on 9 May 2006. This
followed an initial OFT study into the sector and public consultation.
3. The CC published its final report on 30 April 2008.
4. The Department for Business, Enterprise and Regulatory Reform
is responsible for co-ordinating the Government response to CC
market studies.
5. Further information on the CC, its procedures and this
particular investigation can be obtained from its website at: http://www.competition-commission.org.uk
6. The Department for Business Enterprise and Regulatory Reform
helps UK business succeed in an increasingly competitive world.
It promotes business growth and a strong enterprise economy, leads
the better regulation agenda and champions free and fair markets.
It is the shareholder in a number of Government-owned assets and
it works to secure, clean and competitively priced energy supplies
Department for Business, Enterprise & Regulatory
Reform
7th Floor, 1 Victoria Street, London SW1H 0ET
Public enquiries +44 (0)20 7215 5000
Textphone +44 (0)20 7215
6740 (for those with hearing impairment)
http://www.berr.gov.uk