DEPARTMENT FOR
BUSINESS, ENTERPRISE AND REGULATORY REFORM News Release
(PN-2009-117) issued by COI News Distribution Service on 20 April 2009
The Secretary of
State has agreed with a recommendation by the Office of Fair
Trading that newspaper wholesalers will no longer have to conform
to a statutory code of practice requiring them to supply all new
retail outlets.
The decision was taken following a review carried out by the OFT
and an open consultation by BERR.
Wholesalers had been obliged to operate in accordance with an
agreed code of practice governing distribution of national
newspapers in England and Wales.
However, changes in circumstances in the market mean the problem
the code of practice was designed to address - refusal to supply
new retail outlets - is no longer a concern and not likely to re-emerge.
Competition Minister Gareth Thomas said:
"The responses
we received to our consultation on this matter indicate widespread
agreement with the OFT's advice. We are satisfied it is right
to remove these regulatory requirements and leave newspaper
distribution arrangements as a commercial matter for the market."
There will be a six month period for businesses in the industry
to review and amend contractual agreements before the undertakings
are released with effect from 20 October 2009.
Notes to editors
1. For further information and the full decision document please
see the BERR website: http://www.berr.gov.uk/whatwedo/businesslaw/competition/law/news_dis/index.html
2. The OFT published its advice to release newspaper wholesalers
from the statutory obligation to comply with the code to the
Secretary of State on 22 October 2008 in a document entitled
"National Newspapers: A review of undertakings relating to
the supply of national newspapers in England and
Wales".
On the same day BERR launched a public
consultation, inviting views on the OFT's advice to be
submitted by 14 January 2009. BERR received responses from a
range of trade bodies reflecting the full range of businesses
involved in newspaper and magazine supply.
3. The OFT recommended releasing wholesalers from the statutory
obligation to comply with the code after identifying that three
key changes in the market had taken place:
* Increased revenues for wholesalers from distributing
newspapers, through Carriage Service Charges (CSCs).
*
Publishers now have a greater role in the supply chain and have
increased influence in ensuring newspapers are widely
distributed.
* Newspapers are now widely available through a
broad range of retail outlets which have become an established
part of the market.