Amazon has been designated as a grocery retailer and its activities will now fall under the remit of the Groceries Code Adjudicator.
The Competition and Markets Authority (CMA) said Amazon's increasing activity in the UK groceries’ sector in recent years led to its decision to designate the company under the Groceries Market Investigation Order, meaning Amazon and its relevant UK subsidiaries must now comply with the Groceries Supply Code of Practice.
The code, which applies to retailers with an annual turnover of more than £1 billion from grocery sales, ensures that they treat their suppliers fairly. For example, it restricts firms from making changes to supply contracts at short notice, and also requires retailers to give an appropriate period of notice if they no longer want to use a supplier and provide reasons for ending the contract.
Adam Land, senior director, remedies, business and financial analysis at the CMA, said: “Households across the UK are increasingly using Amazon to buy food and other essential items. Today’s decision to designate Amazon helps to ensure a level playing field for companies active in the groceries sector as people’s buying habits evolve.
“These rules mean that the thousands of companies supplying Amazon with groceries are now protected from potential unfair business practices. We’ll continue to keep a close eye on the sector to make sure all major grocery retailers are bound by the same rules.”