Competition Commission plans: the big four reply

23 April 2008
More news

24 April 2008

Supermarkets Tesco, Sainsbury's, Morrisons and Asda have responded to the Competition Commission's (CC) proposed Groceries Supply Code of Practice.

In its reply Asda argued overseas vendors should be exempt as they supply customers in other countries who are not answerable to the code.

Retailers were invited to comment on the proposals by the CC, following their publication earlier this year (News, 28 February). Asda was the only supermarket to call for the exclusion of overseas suppliers.

The charity ActionAid, which lobbies for retail suppliers overseas, has written to Asda urging it to take heed of the proposals. Jenny Ricks, corporates campaigner for the charity, said the request was a "blatant contradiction of its commitment to ethical trading.

"Workers in developing countries feel the effects of big supermarkets' buying power. The CC's proposals will help prevent the transfer of risk down the supply chain and stop supermarkets driving suppliers into the ground."

The CC also proposed an ombudsman to mediate disputes and investigate retailers' records if suppliers made a complaint, but this was unpopular among supermarkets. Tesco said the idea was "misguided" and would create "unnecessary bureaucracy". Morrisons added suppliers were no more likely to approach an ombudsman than the Office of Fair Trading, while Sainsbury's felt the CC's current policing process was adequate.

Simon Briault, spokesman for the Federation of Small Businesses said the CC could do more to restrict the power of grocery firms.

SMapr2008

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