With legal support from Friends of the Earth and backing from farmers’ pressure group FARM and The National Federation of Women’s Institutes, the ACS has submitted a formal request for a market study.
The association’s public affairs and communications manager, James Lowman, said that the last inquiry into the market, by the Competition Commission in 2000, had found practices that were against the public interest, and that the situation had worsened considerably since then with consolidation concentrating even
more financial power into four major multiples. Issues that the ACS is raising include below-cost selling, price flexing, the move by two of the big four into the neighbourhood market and the way the competition authorities define the grocery market. It is also calling for a moratorium on further takeovers by the big four while such an inquiry was undertaken.
Lowman said that the FoE legal team had helped prepare the document. On this occasion, he added, the ACS’s approach to the OFT was a new one in that although it had called for a study in the past, it had always been in the context of an inquiry into a c-store chain takeover.
Because of the regulations constraining the OFT in such cases, it had been unlikely to look at the overall market in such a context.
Now, Lowman said, he was optimistic that this new approach would work and be supported by strong political pressure.
MPs from the all-party Small Shops Group will make representations to the OFT and ACS members will lobby their constituency MPs in an effort to get them involved.
The ACS is also planning to back up its campaign with new research which it says will demonstrate the damage that the increasing power of the major multiples has caused to the independent sector.
Lowman said: “There is increasing awareness among MPs, civil servants and ministers that unfettered supermarket power could harm consumers’ interests.”