Evidence of UK retail monopoly but pricing fair - supermarkets - Brief Article

Eurofood, Feb 3, 2000

As Eurofood went to press, the UK Competition Commission authorities probing allegedly anti-competitive practices in the retail sector said it had found evidence of monopoly control by leading supermarkets. The Commission has written to 24 companies, all of whom it said "belong to one or both of two complex monopolies: one regarding pricing of groceries; and the other their relations with suppliers." These provisional findings are based on 35 hearings with third parties and information from nearly 400 supermarket suppliers and 50 local authorities.

"NO REAL EVIDENCE" OF UNFAIR PRICING

However, some of the inquiry's findings are less damning than had been feared. The sector leader, Tesco, immediately issued a press release emphasising the Commission's finding that there is "at most only limited evidence of excessive profitability" and that "the trend of grocery prices [...], while upwards, has been significantly below that for prices generally in the UK, leading to a reduction in the price of groceries in real terms." The Commission said price rises appeared to be lower than in comparable European countries. The next step will be hearings with Asda, Safeway, Sainsbury, Tesco and Morrisons, to be held in March.