Mike Waterson is a Professor of Economics at the University of Warwick and an expert on competition policy. He’s available for interviews about the new investigation launched into Tesco over concerns that it breached the Groceries Supply Code of Practice.
Prof Waterson said: “The Groceries Code Adjudicator, Christine Tacon, has today (5 February 2015) launched an inquiry into certain of Tesco’s practices in dealings with their suppliers.
“Hers was a position developed as a result of the Competition Commission’s findings on the grocery industry, published in 2008.
“The post was established through the Groceries Supply Code of Practice, published in 2000, which bans a wide range of practices previously apparently widespread in the grocery industry.
“These practices were legal, but heavily biased against suppliers. All the major supermarket chains are now required to comply with the Code.
“In its 2008 inquiry, the Competition Commission met with many suppliers who made allegations about unfair practices in the grocery industry. However, there was a general reluctance by suppliers to go public with these allegations, for fear that the supplier would be dropped and its business collapse as a result.
“Tough business is probably better than no business at all. The Commission came up with the solution of a Code of Practice, to which supermarkets would be bound.
"The practices that are the subject of the order include:
· No delay in Payments
· No obligation to contribute to marketing costs
· No Payments for shrinkage
· Payments for Wastage
· Limited circumstances for Payments as a condition of being a Supplier
· Compensation for forecasting errors
· No tying of third party goods and services for Payment
· No Payments for better positioning of goods unless in relation to Promotions
· Due care to be taken when ordering for Promotions
· No unjustified payment for consumer complaints
· Duties in relation to De-listing
“Only a subset of these is the subject of the current investigation and only in relation to Tesco’s practices, at least at present.”
Professor Michael Waterson was a Member of the Competition Commission at the time of this inquiry, but was not involved in the inquiry and has no information on it that is not in the public domain through the public version of the Commission’s published report and related materials.
Issued by Issued by Lee Page, Communications Manager, Press and Policy Office, The University of Warwick. Tel: +44 (0)2476 574 255, Mob: +44 (0)7920 531 221. Email: email@example.com.
Lee Page, Communications Manager
+44 (0)2476 574 255
+44 (0)7920 531 221