Proactive Investors - Britain’s competition watchdog has decided not to pursue its probe into the infant formula and follow-on milk market, despite identifying a range of concerns.
According to the Competition and Markets Authority, the combination of regulation, manufacturer behaviour, and customer needs has led to poor market outcomes.
The CMA, which started a market study in November, has decided to address the issues through quick recommendations rather than a more in-depth investigation.
It will publish provisional recommendations in October.
French dairy group Danone (LON:0KFX) and Swiss food giant Nestle SA (LON:0QR4) dominate the UK's formula market, holding over 80% of the market share.
The sector is marked by high margins, limited brand options, and few own-label alternatives, the watchdog added.
It also noted that, unlike many consumer products, formula buyers often have no choice but to purchase these products.
From September 2021 to September 2023, prices for branded formula rose by 24%, while own-label alternatives saw a 45% increase.