by Ed Chadwick
A government minister has offered fresh hope that a new industry watchdog will look at anti-competitive practices in the newstrade.
Business under-secretary Jenny Willott said that she would raise concerns with the Competition and Markets Authority (CMA), when it takes up powers previously held by the Office of Fair Trading (OFT) on 1 April.
The CMA is expected to differ from the OFT – which has refused to hold an enquiry into the supply chain – in that the government has asked it to look at competition concerns in business-to-business markets.
Its predecessor was largely involved in protecting the end consumer. Ms Willott’s pledge to raise concerns about the newstrade came in a Westminster Hall debate on 19 March.
When it comes to general products, an independent newsagent can go to many cash and carries, but they are limited as to where they can go for newspapers and magazines
MP for Witham and chair of the All Party Parliamentary Group on Small Shops Priti Patel called the session to underline concerns about what she described as “lack of competition in the wholesale market”.
The Conservative MP raised concerns about cuts to margins on newspapers, “appalling service” and increased carriage charges.
But she said the most pressing issue remained wholesalers’ territorial monopolies.
“Retailers are at the mercy of the wholesaler when it comes to terms and conditions,” she said.
“When it comes to general products, an independent newsagent can go to many cash and carries, but they are limited as to where they can go for newspapers and magazines.”
Ms Willott said she was aware that the newstrade had not been given a “clean bill of health” by the OFT following its initial investigation in 2008 and a subsequent review in 2012 requested by the NFRN.
She said refusal to refer it to the Competition Commission did not mean “that the UK competition authorities will not consider the issue again in the future”.
The minister said that the CMA had been steered by the government to look at business relationships and “this issue is therefore quite clearly in its remit” and would make sure issues raised were “on its radar”.
What issues do you think the CMA should be investigating?
Tell us below: