The Federation of Wholesale Distributors’ biggest member, Big Food Group, has resigned.
In a statement released on Thursday, Big Food Group said it was pulling out after a disagreement over the FWD’s decision to withdraw from its legal action over Tesco’s acquisition of Adminstore.
Big Food Group boss Bill Grimsey said: “We were supportive of the FWD’s appeal. Consequently, we were very disappointed that the FWD withdrew its appeal without prior consultation with key members of its council.
“As a result, we believe that it is no longer appropriate for the Big Food Group to remain a member of the FWD.”
Alan Toft, director general of
the FWD, said: “We are very disappointed. We took decisions based on very firm legal advice and time was of the essence.
“These decisions were based on a previous mandate on costs agreed by the council of
members at a meeting on April 19. The usual conventional consultation process was used.
“Subsequently we received endorsement of our action from key members of the council and we believe benefits for the wholesale/independent sector have arisen from this action.”
Booker, BFG’s cash and carry arm is, by far, the biggest wholesaler in the UK and the largest subscriber to the FWD, but it is thought the move will not affect its long-term survival.
News of the legal action was first revealed in The Grocer (April 24, p4) when it reported that members of the FWD had agreed to set up a five-figure fund to pay for the services of leading law firm Macfarlanes.
It was taken on to fight the OFT’s decision to allow Tesco’s acquisition of Adminstore.
An appeal was lodged with the Competition Appeals Tribunal, but what had been expected to be a straight fight between the FWD and the OFT escalated when Tesco asked for permission to be represented. At this point Macfarlanes told the FWD that it might have to pay the costs of the OFT and Tesco, and it withdrew, although Toft insisted this was purely on financial grounds and it still believed it had a strong case.
Subsequently Tesco said it would not have claimed its costs although the OFT did claim.
In a hearing to decide on the costs last week, the FWD protested that if it was forced to pay the OFT’s costs it would deter any small companies or trade organisations from ever challenging an OFT ruling.
In his judgment, president of the tribunal Sir Christopher Bellamy said such an award could be counter-productive and awarded the OFT only 25% of its costs.
John Wood
In a statement released on Thursday, Big Food Group said it was pulling out after a disagreement over the FWD’s decision to withdraw from its legal action over Tesco’s acquisition of Adminstore.
Big Food Group boss Bill Grimsey said: “We were supportive of the FWD’s appeal. Consequently, we were very disappointed that the FWD withdrew its appeal without prior consultation with key members of its council.
“As a result, we believe that it is no longer appropriate for the Big Food Group to remain a member of the FWD.”
Alan Toft, director general of
the FWD, said: “We are very disappointed. We took decisions based on very firm legal advice and time was of the essence.
“These decisions were based on a previous mandate on costs agreed by the council of
members at a meeting on April 19. The usual conventional consultation process was used.
“Subsequently we received endorsement of our action from key members of the council and we believe benefits for the wholesale/independent sector have arisen from this action.”
Booker, BFG’s cash and carry arm is, by far, the biggest wholesaler in the UK and the largest subscriber to the FWD, but it is thought the move will not affect its long-term survival.
News of the legal action was first revealed in The Grocer (April 24, p4) when it reported that members of the FWD had agreed to set up a five-figure fund to pay for the services of leading law firm Macfarlanes.
It was taken on to fight the OFT’s decision to allow Tesco’s acquisition of Adminstore.
An appeal was lodged with the Competition Appeals Tribunal, but what had been expected to be a straight fight between the FWD and the OFT escalated when Tesco asked for permission to be represented. At this point Macfarlanes told the FWD that it might have to pay the costs of the OFT and Tesco, and it withdrew, although Toft insisted this was purely on financial grounds and it still believed it had a strong case.
Subsequently Tesco said it would not have claimed its costs although the OFT did claim.
In a hearing to decide on the costs last week, the FWD protested that if it was forced to pay the OFT’s costs it would deter any small companies or trade organisations from ever challenging an OFT ruling.
In his judgment, president of the tribunal Sir Christopher Bellamy said such an award could be counter-productive and awarded the OFT only 25% of its costs.
John Wood
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