HL Deb 19 March 2001 vol 623 c128WA
Lord Hylton

asked Her Majesty's Government:

Whether they consider that the larger food buyers are abusing their commercial strength to the detriment of producers and consumers, notably in the cases of milk and meat; and, if so, what action they propose. [HL1138]

Lord McIntosh of Haringey

The Competition Commission published its report on supermarkets on 10 October. The commission found the industry to be broadly competitive and that overall excessive prices are not being charged nor excessive profits made.

However, the commission did conclude that a substantial number of practices used by larger supermarkets in their dealings with their suppliers operated against the public interest. The commission recommended that a code of practice covering remedies for the practices concerned should be established which would put relations between supermarkets and their suppliers on a clearer and more predictable basis.

My right honourable friend the Secretary of State asked the Director General of Fair Trading to approach supermarkets with 8 per cent or more of the relevant market to seek undertakings on a code of practice. These discussions commenced in October and the Office of Fair Trading is currently consulting with the representatives of suppliers.

A copy of the most recent draft of the code of practice can be found in the House of Lords Library.

Lord Vinson

asked Her Majesty's Government:

Whether "the climate of apprehension amongst many suppliers", identified in the report of the Competition Commission on Supermarkets (Cm 4842), has been relieved by the introduction of the code of conduct proposed in the report. [HL1247]

Lord McIntosh of Haringey

The code of practice has not been introduced yet. The Office of Fair Trading has invited representatives of suppliers to comment on a draft of the code.