The UK’s Competition Commission has begun public consultations on its plan to establish a grocery ombudsman to oversee implementation of the new Groceries Supply Code of Practice (GSCOP).
In February this year, the CC published draft proposals to create a new strengthened and extended GSCOP and is now considering responses before finalising the code.
Unlike with the GSCOP, the CC does not have the power to establish an Ombudsman itself, so this will require the agreement of retailers.
UK multiples have thus far largely resisted the ombudsman proposal, arguing that it is an unnecessary burden on a sector already under pressure from wider economic circumstances.
However, if the UK’s multiples resist the plans to set up a watchdog, the CC warened that it would recommend to the Department for Business Enterprise and Regulatory Reform that it takes steps to establish the ombudsman instead.
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“Our report last year uncovered significant evidence of problems in the way retailers deal with their suppliers, which, if left unchecked, will ultimately harm consumers’ interests. We remain convinced, as we were then, that a more robust system to tackle some of these practices and resolve disputes is essential,” Peter Freeman, CC chairman and commented.
“Whilst the strengthened Code of Practice is a major step in the right direction, we believe that the creation of an independent ombudsman is necessary to restore confidence amongst suppliers that there is an objective person looking into disputes and complaints. It is in everyone’s interests to have a system in place in which all parties can have faith.”
If the CC pushes its proposal through, the ombudsman would be appointed by the Office of Fair Trading, which would also set an annual budget for costs and expenses. These costs will be reimbursed from retailers – with larger retailers and those who are the subject of the most complaints paying the most.
The ombudsman would investigate and arbitrate to promote the interests of consumers.