Amazon is facing increased regulatory oversight following the rapid expansion of its grocery business.
The Competition and Markets Authority ruled on Wednesday that Amazon and its relevant UK subsidiaries must comply with the Groceries Supply Code of Practice, which applies to retailers with an annual turnover of more than £1bn from grocery sales. Amazon does not normally break out UK grocery sales.
The code was designed to ensure big-ticket retailers treat suppliers fairly, including preventing grocers from changing contracts at short notice and giving ample time if they want to stop using that supplier.
All of the UK’s main supermarket chains are subject to the code, as are Ocado, Marks & Spencer and Aldi, among others.
Adam Land, senior director, remedies, business and financial analysis at the CMA, said: “Households across the UK are increasingly using Amazon to buy food and other essential items.
“These rules mean that the thousands of companies supplying Amazon with groceries are now protected from potential unfair business practices.”
The US giant has significantly widened the range of foods available on its site in recent years as well as launching Amazon Fresh, a same-day grocery delivery service with a growing number of bricks and mortar stores.
Compliance with the code is managed by the Groceries Code Adjudicator.
A spokesperson for Amazon said the firm “strived to build successful, long-term relationships” with suppliers and that it looked forward to working with the adjudicator.
