The Competition and Markets Authority (CMA) has announced that industry rules setting out how grocery retailers should treat their suppliers will now also apply to Amazon.
According to the Code, which applies to retailers with an annual turnover of more than £1 billion from grocery sales, now restricts firms from making changes to supply contracts at short notice. It also 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 new rule, which now applies to Amazon, ensure that they treat their suppliers fairly.
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Now, the CMA has designated a grocery retailer, compliance with the Code is managed by the independent Groceries Code Adjudicator.
“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,” CMA senior director, remedies, business and financial analytics.
“These rules mean that the thousands of companies supplying Amazon with groceries are now protected from potential unfair business practices.
“We’ll continue to keep a close eye on the sector to make sure all major grocery retailers are bound by the same rules.”
The news comes as Amazon’s latest assault on the grocery sector with hundreds of new shops is “not about profit”, an expert has said.
The tech titan intends to create 260 till-free convenience stores across the country to “catch up” to Sainsbury’s and Tesco.
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