The British Retail Consortium (BRC) has hit out at proposals by the Competition Commission (CC) which today released its plans for the creation of a grocery ombudsman.
The CC said it would be consulting over the coming weeks on a draft of undertakings that would form the office of the ombudsman to oversee and resolve any disputes between the supermarkets and their suppliers.
The CC does not have the power to establish an ombudsman itself, so it will need the agreement of retailers. It will draw up its proposals in the next few weeks.
The CC also proposes to create a new and extended Groceries Supply Code of Practice (GSCOP) addressing concerns that the CC said it had found in relationships between the big grocers and their suppliers in its inquiry into the grocery sector.
It said that it would also publish a draft order outlining measures which would stop exclusivity arrangements and restrictive covenants that it claims are restricting entry of competitors in some local markets.
BRC director general Stephen Robertson said: “This should be about customers. An ombudsman is unjustifiable pandering to supplier pressure groups. It would simply be an expensive bureaucracy - unnecessarily piling on costs with only one result; increased shop prices.”
He said that even in a strong economic climate it would me a mistake. "The Commission concluded that the UK’s highly-competitive grocery market is benefiting customers. It found no evidence of systematic failure in retailers’ dealings with suppliers.
"Robust negotiations are a healthy part of these business relationships. It’s crucial that any new legislation doesn’t damage customers by adding to costs and hampering the successful competition which, the Commission acknowledges, delivers value, choice, innovation and convenience,” said Robertson.
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