Breaking-up supermarket dominance is fair, says Commission

Measures to prevent dominance by one supermarket in local areas are fair and cost effective, the Competition Commission has concluded.

Tesco

The Commission says a test it created would have a “positive effect” for consumers by introducing competition and choice between retailers in a provisional decision published today.

The Commission’s original report, which said the test was necessary to stamp out unfair dominance by single retailers in some areas, was published in April 2008.

It said Local Planning Authorities should reject applications to develop new supermarkets if the applicant’s new store would take them over 60% of provision within a 10-minute drive of the proposed site.

However a tribunal brought by Tesco ruled the Commission needed to do more work to prove the cost effectiveness and proportionality of the test.

Tesco says the Commission’s provisional conclusions, published this morning (July 16), rely “heavily on far fetched assumptions which don’t reflect the reality of the planning system.”

“To continue to recommend a burdensome competition test is a misguided proposal that will cost jobs by deterring investment in the areas that need it most, in what is already a challenging climate,” says Tesco executive director Lucy Neville Rolfe.

She adds the retailer will engage in further discussions with Commission to address its concerns. Responses to its decision can be submitted until 29th July.

A final decision will be published by October 5.

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