On Tuesday 22 January 2008, the Australian Labor Party directed the ACCC to commence a formal inquiry into grocery prices.
ACCC Chairman Graeme Samuel considers that the inquiry will uncover the workings of the relevant markets, their structure and potential inefficiencies within those markets.
The ACCC intends to embark on the inquiry in much the same way it undertook the petrol inquiry, conducting hearings around Australia, consulting with all those along the complex supply chain, from the farmers and growers to consumer groups and any other interested parties.
The inquiry will initially consider, for example:
- the current structure of the grocery industry at the supply, wholesale and retail levels including mergers and acquisitions by the national retailers;
- the nature of competition at the supply, wholesale, and retail levels of the grocery industry;
- the competitive position of small and independent retailers;
- the pricing practices of the national grocery retailers and the representation of grocery prices to consumers;
- factors influencing the pricing of inputs along the supply chain for standard grocery items
- any impediments to efficient pricing of inputs along the supply chain; and
- the effectiveness of the Horticulture Code of Conduct, and whether the inclusion of other major buyers such as retailers would improve the effectiveness of the code.
In doing so, the ACCC hopes to answer what it sees as the big question: why are the growers seemingly getting so little when consumers are charged so much?
Hall & Wilcox will keep you updated of any developments and in the meantime, would be happy to assist you with any questions you have regarding anti-competitive behaviour or other competition law issues.
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