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The OFT’s rethink on the grocery market could be traced back to a meeting it held with the New Economics Foundation (NEF) in early October.
According to NEF policy director Andrew Simms, it was clear during discussions that the OFT’s stance had become paradoxical.
He explained: “While officials said they weren’t convinced that a full market review was needed, they also said that a market cap on the big supermarkets was technically possible, acknowledging that a market share of 8% or over was enough for supermarkets to abuse their power. And we are already way past that point.” The OFT also indicated that a precedent for structural remedies existed, citing the growth of independent brewers following changes to the brewing trade.
Officials also said they would be willing to be more “proactive” toward suppliers.
According to NEF policy director Andrew Simms, it was clear during discussions that the OFT’s stance had become paradoxical.
He explained: “While officials said they weren’t convinced that a full market review was needed, they also said that a market cap on the big supermarkets was technically possible, acknowledging that a market share of 8% or over was enough for supermarkets to abuse their power. And we are already way past that point.” The OFT also indicated that a precedent for structural remedies existed, citing the growth of independent brewers following changes to the brewing trade.
Officials also said they would be willing to be more “proactive” toward suppliers.
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