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TescoGate: Vince Cable voices concern over retailer's supplier relations

Published:  06 November, 2014

Business secretary Vince Cable has written to the Groceries Code Adjudicator over concerns about Tesco's relationships with its suppliers.

Cable wrote to Christine Tacon, the adjudicator, to express support for a comprehensive review into how Tesco deals with suppliers and whether its approach may have contributed to the £263 million profit overstatement.

The news piles further pressure onto the retailer, which is now facing possible criminal charges as part of a Serious Fraud Office investigation into the accounting blackhole.

According to Sky News, and confirmed by the Business, Innovation and Skills department as an "accurate reflection", Cable said while it was important not to prejudge her review, it would be an important exercise closely monitored by both suppliers and consumers.

Last month, Andrew Park, a specialist wine trade lawyer who runs APP Wine Law, told suppliers already have recourse to complain about their treatment at the hands of any of the major retailers, without waiting for conclusions from the probe into goings on at Tesco.

Suppliers have been telling about some of the deals demanded of them in the course of their relationships with Tesco over the past few weeks. Park maintains that suppliers can act now to complain about perceived unfair treatment at the hands of their major retailer customers.

Christine TaconChristine Tacon

Speaking at the end of September the GSCOP adjudicator Christine Tacon said: "I have requested that compliance with the Groceries Supply Code of Practice is included in the scope of the internal [Tesco] investigation and I have asked to be notified if Tesco finds practices which might breach the Code."

"I don't want to interfere in your commercial relationships with retailers, but if you know of a practice that is not only affecting you but is also likely to affect others, isn't that a justification to tell me so I can take action? Give me the tools and I can do the job," Tacon stated.