Tesco cheesed off at price fixing fines

10th Aug 2011 11:52

The Office for Fair Trading (OFT) has fined supermarkets and dairy groups a total of nearly £50m for fixing cheese and milk prices in 2002 and 2003.It has imposed fines totalling £49.51m on all of the big four supermarkets, Tesco, Sainsbury's, Asda and Safeway (which was bought by Morrisons) and five dairy groups including Robert Wiseman and Dairy Crest. "This co-ordination was achieved by supermarkets indirectly exchanging retail pricing intentions with each other via the dairy processors - so called A-B-C information exchanges," the OFT said.Tesco, which has not admitted any liability, was fined more than £10m for fixing cheese prices. The company, Britain's biggest supermarket operator, says it will fight the fines. Asda had its fines reduced for agreeing to early resolution, but still paid nearly £10m including fines for fixing milk and cheese prices.'This decision sends a strong signal to supermarkets, suppliers and other businesses that the OFT will take action and impose significant fines where it uncovers anti-competitive behaviour aimed at increasing the prices paid by consumers," OFT chief executive John Fingleton said."Competition in the supermarket sector is generally intense and has delivered significant benefits to shoppers across the UK in terms of innovation, choice and improved value for money. Our investigation and this final decision will help ensure that this competition is maintained."---RG