This snapshot, taken on 04/03/2010, shows web content selected for preservation by The National Archives. External links, forms and search boxes may not work in archived websites.

We're creating a single website for everything to do with BIS but, while we do that, you'll find information in three places. > Find what you're looking for

 
 

Competition Commission Market Investigation on the Supply of Groceries in the UK

The Competition Commission published its final report on the UK groceries market on 30 April 2008 following a referral by the Office of Fair Trading (OFT) in May 2006 under section 131 of the Enterprise Act 2002.

The CC found that the groceries market is generally delivering a good deal for consumers but identified two main areas of concern that required redress in the market.

  • First, that a large number of grocery retailers were highly concentrated, leading to consumer detriment via poorer retail offers;
  • Second, that grocery retailers with buying power were passing on excessive risks and unexpected costs to their suppliers, which the CC believed could adversely impact on future investment and innovation.

The CC’s main remedies were:

  • to introduce a new strengthened Groceries Supply Code of Practice (GSCOP) (external site) to replace the existing supermarkets code;
  • a recommendation to government (CLG) to introduce a competition test into the planning system;
  • a recommendation to government (BIS) to amend or repeal the Land Agreements Exclusion and Revocation Order so that certain agreements no longer benefit from exclusion from the 1998 Competition Act; and
  • a recommendation to government (BIS) to consider the establishment of a GSCOP ombudsman to enforce the new code if the CC failed to seek initial voluntary undertakings from the larger retailers.

The government’s response was published on 29 July 2008:

The supply of groceries in the UK: the Government response to the Competition Commission market investigationPDF document (63KB)


The BIS consultation on the Land Agreements Exclusion and Revocation Order ran from July to November 2009.

On 4 August 2009, the CC published the new GSCOP Order, which comes into effect on 4 February 2010. At the same time, the CC, having failed to seek voluntary undertakings from retailers, formally recommended to BIS to consider the establishment of a GSCOP Ombudsman with monetary powers to enforce compliance with the Code.

On 2 October 2009 the CC announced its new decision on the Competition Test. This followed further work on the Test after an appeal launched by Tesco in July 2008 and a remittal by the Competition Appeals Tribunal to undertake further analysis.

On 13 January 2010, Government announced its decision to accept the CC's recommendation for a GSCOP Ombudsman and will consult shortly on what powers the body might have and who it might be. At the same time BIS has announced that following the consultation on the Land Agreement Exclusion and Revocation Order it is to revoke the Order in its entirety.

© Crown copyright2010