Big four stores face third price-fix probe

Britain's four major supermarket groups are facing a third Office of Fair Trading investigation into price-fixing allegations, just days before the publication of what is expected to be a hard-hitting report on the industry from the Competition Commission.

Asda, Morrisons, Sainsbury's and Tesco all said yesterday that they were cooperating with a new inquiry launched by the OFT, which is believed to focus on the price of groceries and other products, including health and beauty ranges.

All four companies issued statements confirming that they had been contacted by the OFT and pledged their co-operation.

A spokesman for Tesco, Britain's largest supermarket group, said: "We understand that the OFT has asked for information from a wide range of suppliers and retailers. We are working with them to provide what they require."

A Sainsbury's spokesman added: "We have been asked for some information regarding a number of suppliers and product categories and are helping the OFT with their enquiries."

Both Asda and Morrison's made similar statements, adding that OFT officials had visited their head offices last week.

While stressing their compliance with the OFT's investigation, the supermarkets are thought to be privately furious over the latest inquiry into price-fixing. The regulator is already conducting a long-running probe into allegations of collusion between supermarkets and dairy product providers, and last week announced it was investigating whether the industry had artificial pricing agreements in place with leading tobacco companies.

The OFT has said it is pursuing several price-fixing scandals in a range of industries.

The emergence of a fresh inquiry into the supermarkets could not come at a worse time for the sector. The Competition Commission is this week due to unveil the results of a two-year investigation into whether the big supermarket groups use their market dominance to treat small suppliers unfairly.

The commission will propose the creation of an industry ombudsman to oversee the relationships between the industry and its suppliers. The scheme would initially be voluntary but could be backed by Government legislation if supermarkets do not join.