OFT hits out at 'sloganeering' in newsstand row

By Alyson Fixter

The Office of Fair Trading has hit back at magazine publishers who
are seeking to halt controversial moves to deregulate the newsstands,
claiming the industry is resorting to “excitable sloganeering” to get
its own way.

According to official guidance recently released by the OFT, the
current magazine distribution system is breaking competition law and
ripping off newsagents, who have no right to seek better supply deals.

But
the PPA and BSME have warned that if the guidance is followed, it could
result in thousands of small newsagents closing and niche magazines
folding.

They have also warned that the country could go the same
way as the US, where a shake-up of the market has left supermarkets
with huge power over which magazines are stocked and all but two
wholesalers have closed.

But Becket McGrath, a director of
competition enforcement at the OFT, said: “All we are doing at the
moment is giving the industry some advice on what we think the law
says. The law itself changed about a year and a half ago to bring it in
line with Europe.

“At that point, the news and magazine
industries got alarmed because they saw this was going to cause
problems for their [distribution] agreements.

“They asked us for
special protection, which we declined to give them, but we did agree to
give them some formal guidance on their position.

“The people in
this industry are well informed and they understand how this works and
they do not have an excuse [for some of their claims].

“Now
they’ve seen that they haven’t persuaded us on the intellectual
arguments they’re reverting to this rather excitable sloganeering
instead.”

But a PPA spokesman said: “There could be direct
implications for journalists and the wider industry as a result of the
OFT’s opinion. “Naturally, they are going to continue to ask questions and pursue the matter.”

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