New Tesco probe: UK grocery watchdog to investigate its supplier practices
Britain's grocery industry watchdog has launched an investigation into supermarket Tesco's supplier practices which have resulted in delayed payments.
The Groceries Code Adjudicator (GCA), which it set to be handed new powers to impose penalties on large retailers of up to 1 percent of their annual UK turnover, said it had made the decision after considering information related to practices associated with Tesco's first half profit over-statement.
The watchdog said the probe, which will cover the conduct of Tesco from June 25 2013 to Feb. 5 2015, was expected to take place over the next six to nine months and called for evidence to be submitted by April 3.
"The investigation will consider the existence and extent of practices which have resulted in delay in payments to suppliers," the GCA said.
It added it would also consider the existence of practices where suppliers have had to pay for better positioning of goods on Tesco's shelves which are not related to a promotion.
The GCA's probe adds to investigations by Britain's Serious Fraud Office and the Financial Reporting Council into Tesco's accounting scandal, in which it overstated profit by £263.