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Industry calls on government to waive competition laws to stem no-deal Brexit fallout

07 August 2019 by
Industry calls on government to waive competition laws to stem no-deal Brexit fallout

Industry chiefs have called on the government to allow businesses to co-ordinate their approach to a no-deal Brexit by waiving competition laws for food companies.

Representatives for suppliers and retailers have warned that businesses will struggle to serve remote or vulnerable areas of the country if a deal is not brokered between Brussels and Westminster by the 31 October deadline.

A no-deal Brexit would see Britain fall back on to World Trade Organisation (WTO) rules for imports from the European Union - particularly through the port of Dover. Not only would this make food items more expensive - it would also mean more checks would have to be carried out on items as they cross the border.

Experts have warned that if checks take just six seconds longer at the border, it is likely to have a dramatic impact on the UK, leading to food shortages for around six months.

The Food and Drink Federation's Tim Rycroft told the BBC: "It may be the government is going to come to us and say, ‘can't you guys work together to ensure that remote communities or the elderly or children - at-risk groups - don't suffer from these shortages'.

"We're happy to help, but the Competition Market Authority (CMA) can fine companies up to 10% of turnover if they are guilty of anti-competitive behaviour. So we wouldn't be able to do that without some pretty cast-iron reassurances."

In 2001, after the outbreak of foot and mouth disease, supermarkets and suppliers agreed higher prices on milk and butters sales, arguing the money would help farmers struggling in the wake of the illness. Many paid large fines as a result.

John Fingleton, the former head of the Office for Fair Trading, added: "The last time something like this happened was in relation to dairy prices in 2001 when companies incorrectly thought government words about higher prices for dairy farmers would protect them from competition law. It did not."

A government spokesman said: "The UK will be leaving the EU on 31 October and our top priority is supporting consumers and businesses in their preparations for Brexit.

"We are working closely with the food industry to support preparations as we leave the EU."

UKHospitality's Kate Nicholls: ‘no-deal Brexit would be a catastrophe for hospitality'>>

Business leaders demand no deal Brexit taken off the table>>

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