CMA designates Amazon as a grocery retailer to ‘protect suppliers’
The CMA said the decision will help to ensure a ‘level playing field’ for companies active in the groceries sector as people’s buying habits evolve
The Competition and Markets Authority (CMA) has designated Amazon under the Groceries Market Investigation Order, meaning the company and its relevant UK subsidiaries must now comply with the Groceries Supply Code of Practice.
The announcement follows Amazon’s “increasing” activity in the UK groceries’ sector in recent years, and the industry rules setting out how grocery retailers should treat their suppliers will now apply to Amazon.
The Groceries Supply Code of Practice, which applies to retailers with an annual turnover of more than £1bn from grocery sales, ensures that retailers treat their suppliers “fairly”.
This includes restricting firms from making changes to supply contracts at short notice, and it requires retailers to give an “appropriate” period of notice if they no longer want to use a supplier and provide reasons for ending the contract.
The CMA regularly monitors UK retailers to see if they meet the criteria to be covered by the Code, such as relevant turnover.
Adam Land, senior director of Remedies, Business and Financial Analysis at the CMA, said: “Households across the UK are increasingly using Amazon to buy food and other essential items. Today’s decision to designate Amazon helps to ensure a level playing field for companies active in the groceries sector as people’s buying habits evolve.
“These rules mean that the thousands of companies supplying Amazon with groceries are now protected from potential unfair business practises.”
