The Competition and Markets Authority (CMA) will now recognise Amazon as a grocery retailer in order to protect UK suppliers.
As a result of the change by the CMA, Amazon will now be subject to the Groceries Market Investigation Order – a set of industry rules applying to retailers with an annual turnover of more than £1bn from grocery sales.
The rules indicate how retailers should manage relationships with their suppliers, including guidance around making changes to supply contracts, giving periods of notice and providing reasons for terminating contracts.
The move follows the tech giant’s increasing levels of activity in the sector. The CMA outlined that Amazon supplies groceries in the UK through two “wholly owned subsidiaries”, Amazon EU Sarl and Fresh & Wild Limited.
Furthermore, Amazon has opened nine Amazon Fresh stores since November, bringing the total number of stores in the UK to 15. The first opened in March 2021.
Amazon now joins a group of other UK retailers that must comply, including Ocado, Asda, Co-op, Marks & Spencer, Sainsbury’s, Waitrose, Tesco, Morrisons, Waitrose and Lidl, as well as Iceland, B&M and Home Bargains.
An independent groceries code adjudicator will oversee Amazon’s compliance with the code.
CMA senior director Adam Land 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.”
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