ACS

Pressure is growing on the Competition Commission to consider the impact of the Somerfield sale in its final report. Andrew George MP has written to the Competition Commission to inquire whether its ongoing Inquiry into the groceries market will change the way it deals with major sales.

Mr George said: “The Competition Commission has a massive decision to make.

“It can repeat its 2003 role as a competition regulator and acknowledge that potential market concentration could create an anti-competitive environment. Alternatively, the Commission stands by its assertion that supermarket growth should not be restricted and allows the market to become more concentrated in fewer hands to the detriment of smaller traders and suppliers.

“A sale of Somerfield stores will show – just as WalMart’s purchase of ASDA and Morrisons’ of Safeway did – that market entry and growth do not depend on a libertarian approach to planning laws.”

ACS Chief Executive, James Lowman, wrote to the Competition Commission when the sale was announced saying: “We welcome this intervention from Andrew George. We have also warned about the repercussions of further acquisitions in the UK grocery market. It is this ongoing consolidation of the market into the hands of just four companies that reduces the opportunity for businesses to enter and grow in the market. The lack of choice and diversity that this presents now and in the future is a major blow to consumer interests.

The competition authorities should not allow the sale of Somerfield to an existing Big 4 retailer as this will further entrench their dominance of the market.”

The Competition Commission is due to release the final Grocery Market report in April 2008.