Tesco rejects price fixing claim after £10m fine

Tesco has rejected a ruling that it colluded with other retailers and suppliers to fix the price of cheese and milk.

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The Office of Fair Trading has fined Tesco £10m for participating, alongside the other major supermarkets and five major suppliers, in “anti-competitive behaviour aimed at increasing the prices paid by consumers”.

The OFT has ruled that Asda, Sainsbury’s Tesco, and Safeway (now Morrisons) co-ordinated with each other and suppliers including Arla and Dairy Crest, to increase the prices consumers paid for some dairy products in 2002.

Arla escaped a fine from the OFT as it was the first involved company to alert the watchdog to possible infringements. The total fine for all parties was £49.51m
Tesco was the only involved party that did not admit liability for the infringements and seek early resolution.

The supermarket has slammed the watchdog’s role and says it supports the Government’s plans for a new competition regime through a supermarket ombudsman.

Lucy Neville-Rolfe, Tesco’s director of corporate and legal affairs, says: “We are disheartened and disturbed that the OFT continues to pursue this costly and time consuming case at the expense of both the tax payer and UK business. We will continue to defend our position vigorously, through the courts if necessary.”

“We surely have now reached the stage where the absurdity of the OFT operating as investigator, prosecutor and judge cannot be allowed to continue. The Government’s plans for the new competition regime must address this anomaly, in the interests of the consumer and the business community.”

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