Competition laws relaxed: UK supermarkets join forces to feed nation amid COVID-19

20 Mar 2020 --- The UK government is temporarily relaxing elements of competition law as part of a package of measures to allow supermarkets to work together to feed the nation amid the COVID-19 outbreak. The move allows retailers to share data with each other on stock levels, cooperate to keep shops open, or share distribution depots and delivery vans. It is also aimed at allowing retailers to pool staff with one another to help meet demand.

“We’ve listened to the powerful arguments of our leading supermarkets and will do whatever it takes to help them feed the nation. By relaxing elements of competition laws temporarily, our retailers can work together on their contingency plans and share the resources they need with each other during these unprecedented circumstances,” says the UK’s Environment Secretary George Eustice.

Eustice confirmed that these elements of the law would be temporarily waived in a recent meeting with chief executives from leading UK supermarkets, as well as food industry representatives. The Environment Secretary also detailed that the government will temporarily relax the five pence (US$0.06) single-use carrier bag charge for online deliveries in England. This will speed up deliveries and minimize any cross-contamination from reusing crates. This will come into force this weekend on Saturday, March 21. The charge remains in place for in-store purchases.

Click to EnlargeThe UK is temporarily relaxing rules on drivers’ hours  to allow supermarkets to meet the increased demand for home deliveries“In these extraordinary and challenging times, it is important that we remove barriers to our supermarkets working together to serve customers, particularly those who are elderly, ill or vulnerable in all parts of the UK,” says the UK’s Business Secretary Alok Sharma. 

“The temporary relaxation of competition law for the food sector will allow supermarkets to cooperate with each other to keep their shops staffed, their shelves stocked, and the nation fed. I am clear that we will continue to do whatever it takes to support business through this extremely difficult period,” he continues.

“We welcome this important decision by the government to give retailers greater flexibility to work together to tackle the challenges posed by coronavirus. Retailers have been working hard to ensure shelves are stocked and this is an exceptional step taken by the government to help retailers and their suppliers cope with problems that might be caused by wide scale absences across the supply chain,” adds Andrew Opie, Director of Food & Sustainability at the British Retail Consortium (BRC).

This short-term measure aims to enable retailers to agree common specifications for products to bolster food production and coordinate certain operations to ensure consumers across the UK have access to the essential items they need. Legislation will be laid shortly to amend elements of the Competition Act 1998, which prevents certain types of anti-competitive behavior. This can be relaxed in exceptional circumstances.

Waived competition fees are called upon by businesses coping with circumstances of an economic downturn. Britain’s food and drink industry previously called on its government for a similar allowance during contingency planning for a “catastrophic” no-deal Brexit.

Extended delivery hours across the UK
The announcement of the relaxation of competition laws comes as the government confirmed it would temporarily relax rules on drivers’ hours to allow supermarkets to meet the increased demand for home deliveries, while helping move food and other essentials faster so that shelves can be stocked up.

This change to UK drivers’ stipulated hours, which comes into effect today, means that delivery drivers are now able to work slightly longer hours – helping supermarkets offer additional delivery slots. This is particularly important for vulnerable people and those staying at home during the COVID-19 outbreak. It will also provide extra capacity if drivers are unwell.

Already in Europe, industry stakeholders have begun voicing concerns about prolonged trade bottlenecks caused by tightened border control mitigating the spread of the coronavirus, as previously reported on FoodIngredientsFirst. In Italy, F&B stakeholders have voiced concerns that food excellence may “fall into the eye of the hurricane” as the virus continues its spread out of China. Meanwhile, global COVID-19 concerns contributed to a significant World Food Price dip in February. 

By Benjamin Ferrer

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