UK: Government threatens to establish ombudsman
The UK government has warned that it may intervene if retailers and the Competition Commission are unable to agree over the establishment of an ombudsman to police competition in the retail sector.
Concluding its investigation into competition in the UK's grocery sector, the Competition Commission controversially suggested that a body be established to ensure large multiples do not use their size to distort competition. The competition watchdog also said a competition test should be introduced to determine planning approval for supermarkets. The UK's multiples have vocally registered their opposition to both of these moves.
However, the Department for Business, Enterprise and Regulatory Reform today (31 July) said that if the parties could not agree on setting up an ombudsman it could intervene.
"If agreement cannot be reached, and we deem it in the best interest of consumers, it is within our remit to step in," a spokesperson for the department told just-food.
"Any assessment [would be] based primarily on what would be in consumers' best interests," the department added in a statement.
The department said that it will take more time to form an opinion on the planning issue and added that it would consult later in the year on whether action to prevent land banking and restrictive covenant practices to prevent competitors entering an area was necessary.
Commenting on the Competition Commission's findings, consumer affairs minister Gareth Thomas said: "I thank the Competition Commission for such an extensive and thorough investigation. Many of the measures they have identified will benefit consumers and I hope that they can implement them quickly. Further work, dialogue and consultation will take place on the recommendations put to government."
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