The NEF has warned that Britain could become a 'one-supermarket state' if the commission refuses to use its powers against the UK's big four supermarket chains, in its response to the body's Emerging Thinking document.
NEF's policy director Andrew Simms said: 'We have to reserve judgement slightly, but I have the disturbing sense of groundhog day about this inquiry. It is dangerously close to being a rerun of the last inquiry into the supermarkets in 2000, when dozens of anti-competitive practices were highlighted, but there were no effective remedies.
'If the commission can't do its job and put in place checks and balances to ensure genuinely open markets, people will be justified in questioning exactly what the commission is for.'
In its submission to the inquiry, the NEF also condemned Britain's biggest grocer, Tesco - which has a 31 per cent share of the UK grocery market - for defining 'local' as 30 minutes away. It pointed out that this would mean that, for someone living in Chelmsford, Essex, a store 17 miles away at Romford or Leigh-on-sea would be considered local.
Simms said: 'The collective dominance of the big four supermarkets undermines the choice of consumers to enjoy a full range of goods and services provided by a healthy range of formats - including a diversity of independent local retailers and street markets.'
The NEF has also called for the Competition Commission to define local competition, clarify consumer interest and detriment, and identify an acceptable level of market share for the dominant four.
The think tank added: 'The next phase of the commission's investigation will be a clear test of its fitness for purpose and its ability to manage a modern economy in which the leading players are growing ever more powerful.'
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