The British Competition Commission has expressed concerns about the dominance of the UK’s leading retailers – Tesco in particular – in the UK market.

In its 'emerging thinking' document – published as part of its inquiry into the UK's supermarket industry – the Commission said it is concerned that 'Tesco PLC, or any other supermarket, can get into such a strong position, either nationally or locally, that no other retailer can compete effectively'.


It also acknowledged the extent of retailers' land holdings, but said it is “how these are used at local level, and the related effect of the planning system, that matters”. Peter Freeman, chairman of the Commission and Inquiry Group told AFX News that “'It would be a cause for concern if supermarkets, either individually or collectively were in a position to increase prices or lower their offer in any particular locality or region because of lack of effective competition.”

The Commission said its principal concern is to focus on competition between retailers “at the local level, where it matters to consumers”, adding that this is where many of the potential concerns have been evident. “We have now gathered a large amount of evidence about the overall picture in this market, and having gathered this information, we can now look in detail at the situation locally,” Freeman said.

He also expressed the need “to see what choices shoppers have in particular areas and how competition works between retailers of different size”. The Commission also said it has considered the evidence supplied concerning relationships between grocery retailers and their suppliers, adding that, while these have not indicated widespread problems in the supply chain, there are “still concerns”.

Click here for the full text of the ‘emerging thinking’document.