Tesco has been landed with a £1m bill for the costs of the Groceries Code Adjudicator’s investigation into the retailer.
The GCA, Christine Tacon, found that the supermarket giant deliberately delayed payments to suppliers following an exhaustive year-long investigation into its practices, which cost £1.2m.
Tacon, who was unable to fine the supermarket, has instead instructed Tesco to make the payment to help foot the bill.
The GCA’s power to dish out financial penalties worth up to 1% of turnover only came into force last April, after the breaches of the code took place.
The watchdog is funded by the 10 retailers it oversees, which all pay an annual fee.
Last month Tacon ruled that Tesco had breached the code and said it must introduce “significant changes” to its practices and systems. She said the grocer has “acted unreasonably” by delaying the payments and admitted she was shocked at how “widespread” the practice was, particularly ahead of “key reporting periods” in order to achieve margin targets.
Tacon added: “The length of the delays, their widespread nature and the range of Tesco’s unreasonable practices and behaviours towards suppliers concerned me.
“I was also troubled to see Tesco at times prioritising its own finances over treating suppliers fairly. My recommendations will deal with the weaknesses in Tesco’s practices during the period under investigation.”
But Tesco boss Dave Lewis insisted the supermarket giant had “drawn a line under the past” after carrying out its own internal investigation and shared its findings with the grocery watchdog a year ago.