Campaigning to curb supermarket power

A Supermarket Code of Practice

A UK Supermarket Code of Practice was introduced in March 2002 to redress the balance between the big supermarkets and their suppliers, including farmers. However, it was strongly criticised for being too weak. Finally in February 2010 a new, stronger Grocery Supply Code of Practice (GSCOP) came into force.  In June 2013 a new Groceries Code Adjudicator was appointed to oversee the Code.

Supermarket Code of Practice and Market Investigation timeline

  • 1999 - The Office of Fair Trading (OFT) asks the Competition Commission (CC) to conduct an inquiry into complaints that supermarkets were abusing their market position in their dealings with suppliers.
  • 2000 - CC report is published, and concludes that supermarkets were acting against the public interest and that a Supermarket Code of Practice should be introduced. 
  • 2001 - OFT draws up the Code, which is published in October. 
  • March 2002 - existing voluntary code introduced after the Competition Commission found large supermarkets operating against the public interest, reducing the choice and quality of goods. 
  • March 2003 -The Office of Fair Trading (OFT) commences a year long review of the code. 
  • February 2004 - the OFT completes its review and concludes that "the Code is not working effectively", but fails to put forward recommendations for change. Instead it proposes further investigation and an audit of the supermarkets' records. A review of the Supermarket Code of Practice by the OFT found 80-85% of respondents claiming that the Code had failed to bring about any change in supermarkets' behaviour. The review revealed that supermarket practices had not changed significantly, and that the position of suppliers has become weaker.
  • November 2004-  Friends of the Earth, the Association of Convenience Stores and the National Federation of Women's Institutes submit a request to the OFT for a market review of the grocery market, including impacts on suppliers, but stress that revision of the Code does not need to be delayed for the outcome of a market review.
  • March 2005 - The results of the independent audit are published, and reveal that supermarket practices had not changed significantly since the introduction of the Code, and that the position of suppliers had become weaker. The OFT admits that it cannot "allay the concerns which have been expressed" about the Code's effectiveness and is unable to tackle the social and economic problems caused by the dominant position of the large retailers.A report based on an independent audit in 2004/2005 of supermarket relations with their suppliers concluded that the Code is not being used to resolve disputes.
  • August 2005  -OFT publishes its conclusions of the review of the Supermarket Code of Practice and other competition concerns. It concludes that the Code should remain unchanged, but be used more effectively. The OFT also fails to recommend a new market investigation into the grocery sector. 
  • 3 October 2005 - The Association of Convenience Stores (ACS) hire lawyers Edwin Coe to launch an appeal to the Competition Appeal Tribunal over the Office of Fair Trading’s refusal to call for another inquiry into the big supermarket chains. Friends of the Earth intervene to support this appeal.
  • 28 October 2005 - The OFT withdraws its previous decision, and agrees to reconsider its decision not to refer the grocery market to the Competition Commission (CC) for a full review.
  • November 2005 Friends of the Earth and Association of Convenience Stores submit new evidence to the OFT.
  • February 2006 All-Party Parliamentary Small Shops Group releases its report High Street Britain: 2015 warning that many small shops will go out of business if action not taken to curb supermarket growth. The report calls for a Retail Regulator and revisions to the Code of Practice
  • March 2006 - the OFT issues a preliminary ruling recommending a Competition Commission review of the supermarket sector is necessary. It then holds a four-week long open consultation.
  • May 9 2006 - the OFT announces that it will refer the supply of groceries by retailers in the UK to the Competition Commission (CC) for a market investigation.Following public pressure, the OFT referred the UK grocery retail market for a fresh market investigation by the Competition Commission (CC). In its Statement of Issues the CC stated that it would look at supplier issues, particularly whether the behaviour of grocery retailers towards their suppliers threatens the economic viability of suppliers or wholesalers, affects competition in grocery retailing, and affects competition among suppliers, for example by limiting the range of products. See the submissions many different organisations have made to the inquiry.
  • June 2006 - the CC releases the Statement of Issues defining the scope for its inquiry.
  • July - September 2006 - the CC holds hearings with main and third parties.
  • January 2007 - the CC publishes its emerging thinking outline the areas it intends to proceed with in its inquiry.
  • April 2007 - the CC announces that the timetable for the inquiry will be delayed, with a final report now expected in February 2008.
  • June 2007 - the CC releases a working paper on the Supermarket Code of Practice. In the paper the CC acknowledges that many of the practices identified in the 2000 CC inquiry continue to be carried out and that many of them are likely to have an adverse impact on competition.
  • April 2008 - the CC publishes its final report which concludes that supermarkets are guilty of transferring unnecessary risks and excessive costs onto their suppliers. In its proposed remedies the CC recommends a new Grocery Supply Code of Practice (GSCOP) to replace the existing Supermarket Code of Practice and the establishment of a new Ombudsman to police the Code.
  • September 2008 - the CC releases a revised remedies implementation timetable.
  • February 2009 - the CC releases its notice of intention to make an order for the Grocery Supply Code of Practice.
  • January 2010 - Government announces that it will accept the CC's recommendation to establish a new supermarket ombudsman. Read the announcement here.
  • February 2010 - new Grocery Supply Code of Practice (GSCOP) came into force. 
  • January 2013 - Christine Tacon announced as new Groceries Code Adjudicator.
  • June 2013 - Christine Tacon starts in new role.