A BELFORD councillor is challenging the Co-op about its apparent creation of a monopoly and unfair trading practices in Belford, and is concerned it may be happening in other Northumbrian towns and villages.
Geoff O'Connell, Independent Borough Councillor for Belford, has taken his complaint to the Office of Fair Trading (OFT) and the Competition Commission in London, with the backing of Berwick MP Alan Beith.
Coun O'Connell has taken this up after numerous complaints and comments from residents of Belford.
Coun O'Connell said: "I was alarmed last September when the Co-op announced that the Spar grocers in our village was to close and that a ten-year restrictive covenant had been placed by the Co-op on the old Spar premises in the High Street.
"This covenant has the clear intention of preventing any activity in the old shop which the Co-op deems would be in competition with their own shop in the village. What seems to make the situation even more sinister is that the Co-op does not even own the former Spar premises yet it has endeavoured to place a 'dead hand' on its future use."
A Co-op spokeswoman said: "When the Spar closed, the Co-op was and is not in a position to prevent other food retailers from opening in Belford."
Coun O'Connell undertook his own research into the prices of everyday products at Co-op stores in Belford, Seahouses and Tweedmouth, prior to the Spar shop closing, and found a startling variation in the prices of identical products.
He found that the total shopping bill was 18 per cent higher in the Seahouses store than in the Tweedmouth store, which has to compete with rivals Morrisons and Somerfield in Berwick, and in Belford the prices were nine per cent higher than in Tweedmouth.
Coun O'Connell said: "What became rapidly clear was that where the Co-op had to compete on a level playing field with other major operators they had one set of price levels. But where they effectively had a monopoly then there were other higher bands of prices for the same goods."
After continued pressure from Belford Parish Council, the old Spar shop has recently been given a coat of paint, although Mr O'Connell believes this could also signal that the premises is about to go up for sale.
The covenant placed on the premises by the Co-op was granted by the owners of the property, a Southport-based property subsidiary of the former operators of the SPAR franchise, wholesale grocery distributors Murgatroyd's.
The covenant states that the premises cannot be used for the sale of food, alcohol, tobacco, newspapers and magazines or the sale or hire of dvds or videos to name just a few. In short, the covenant prohibits the sale of anything that was sold by the Spar shop. With the closure of the Spar shop last September, the only shop which sells food in Belford is now the Co-op.
A Co-op spokeswoman has defended the covenant, stating that it is "standard practice in the industry".
Coun O'Connell said: "I believe this to be grossly unfair and I am pressing the OFT and the Competition Commission for a rapid response.
"I am a member of the Co-op, as were my parents and grandparents, and I find that the Co-op's trumpet calls about 'Fairtrade' sit uneasily with the position I have found on the ground.
"It seems that 'Fairtrade' applies if you are a Brazilian coffee grower or a fruit farmer in Africa – but fair trade seems to stop at the English Channel!".
Echoing Councillor O'Connell's concerns, Berwick's MP, Alan Beith, said: "I am very concerned at the way the Co-op in the North East appears to be deliberately driving out competition which is contrary to the principles of the Co-op movement and is creating a monopoly in many communities".
Coun O'Connell added: "The situation we find ourselves in in Belford seems to be mirrored in Wooler, Seahouses, Corbridge, Rothbury and Prudhoe, and if that is the case it should be the cause for even greater concern".
A Co-op spokeswoman said: "We will be investing in the Co-op store (in Belford) and revamping it early next year, which will allow us to offer the most modern of shopping facilities and more of our promotions which are exceptional value for money.
"The Co-operative Group is owned and democratically controlled by its members who are its shoppers. It is committed to providing quality products at value for money prices."