The code removes the threat of legislation to force wholesalers to accept new retail outlets after a Monopolies and Mergers Commission investigation into complaints from retailers that wholesalers were refusing to supply them.
The MMC concluded that the refusal of wholesalers to supply new retailers in outlets which they believe are adequately supplied limited competition and was against the public interest.
Under the code of practice wholesalers will have to accept requests for supply from retailers provided they agree to a minimum order at least half the size of the wholesaler's average order and pay a deposit equal to three weeks' supplies, which will be refunded after a year.
WH Smith and John Menzies, two of the largest wholesalers, both welcomed the acceptance of the code. The code will also allow established retailers to set up sub-retail outlets or transfer copies to other shops within 500 metres in urban areas adn one kilometer elsewhere. It will come into effect on 1 October.Reuse content