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05/02/2015
New Regulator To Investigate Tesco
A new regulator is to investigate supermarket chain Tesco over its relations with suppliers.
The announcement follows concerns that the company breached the Groceries Supply Code of Practice.
The Groceries Code Adjudicator (GCA) is the latest organisation to investigate the retailer, after the Serious Fraud Office and the Financial Reporting Council.
GCA adjudicator, Christine Tacon, said she made the decision to investigate after receiving information "relating to practices associated with the profit over-statement announced by the retailer in September 2014".
It will look into the company's profits and delays in payments to suppliers.
Following discussions with Tesco, she said further information is needed from direct suppliers and other parties to determine if, or what, further action should be taken.
Ms Tacon has said she had "reasonable suspicion" that the code had been breached, but the GCA will be unable to find the supermarket for any past offences.
The investigation could take up to nine months, and evidence is to be submitted by 3 April 2015.
Ms Tacon commented: "This is the first investigation I have launched and it is a significant step for the GCA. I have taken this decision after careful consideration of all the information submitted to me so far.
"I have applied the GCA published prioritisation principles to each of the practices under consideration and have evidence that they were not isolated incidents, each involving a number of suppliers and significant sums of money."
Meanwhile, a spokesperson for Tesco is quoted as saying: "We have worked closely with the office of the adjudicator since its creation to put in place strong compliance processes.
"An internal review we carried out and shared with the GCA identified some areas of concern. We have taken action to strengthen compliance and, as we have announced, we are changing the way we work with suppliers."
(JP/CD)
The announcement follows concerns that the company breached the Groceries Supply Code of Practice.
The Groceries Code Adjudicator (GCA) is the latest organisation to investigate the retailer, after the Serious Fraud Office and the Financial Reporting Council.
GCA adjudicator, Christine Tacon, said she made the decision to investigate after receiving information "relating to practices associated with the profit over-statement announced by the retailer in September 2014".
It will look into the company's profits and delays in payments to suppliers.
Following discussions with Tesco, she said further information is needed from direct suppliers and other parties to determine if, or what, further action should be taken.
Ms Tacon has said she had "reasonable suspicion" that the code had been breached, but the GCA will be unable to find the supermarket for any past offences.
The investigation could take up to nine months, and evidence is to be submitted by 3 April 2015.
Ms Tacon commented: "This is the first investigation I have launched and it is a significant step for the GCA. I have taken this decision after careful consideration of all the information submitted to me so far.
"I have applied the GCA published prioritisation principles to each of the practices under consideration and have evidence that they were not isolated incidents, each involving a number of suppliers and significant sums of money."
Meanwhile, a spokesperson for Tesco is quoted as saying: "We have worked closely with the office of the adjudicator since its creation to put in place strong compliance processes.
"An internal review we carried out and shared with the GCA identified some areas of concern. We have taken action to strengthen compliance and, as we have announced, we are changing the way we work with suppliers."
(JP/CD)
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