Companies in the clear on credit

Ofwat will not be pursuing any further policy work on credit arrangements in the business retail market at this time.

In a letter to retailers and the associated companies, senior director of customers and casework, Emma Kelso (pictured) said Ofwat is “generally satisfied” with what it has been told by companies in response to its earlier letter seeking assurance on credit arrangements and customer pricing.

It was seeking an understanding of whether credit arrangements created barriers to entry for smaller players, and whether parent company guarantees and intra-company credit led to an unlevel playing field. Kelso added that where Ofwat had questions, it will contact retailers “separately and confidentially” to gain a better understanding of their set-ups.

Kelso took the opportunity of the letter to reiterate to retailers some of the key principles around where concerns may arise in relation to competition law.