Wholesalers were the main beneficiaries of the Groceries Order, according to Tesco, the biggest food retailer in the State.

In a submission made to the Government before this week's decision to rescind the order, Tesco said the rules prevented consumers from realising the benefits of competition. The company said the most damaging aspect of the order was "standard wholesale price-fixing".

Tesco's submission to Minister for Enterprise Micheál Martin was its first public intervention in the contentious debate about the order. The group ranks highly among the potential beneficiaries of the order's removal because it will have the financial muscle to offer heavy discounts on packaged food.

Still, the group said it passed on to consumers "the full value of off-invoice discounts in the form of lower margins on a wide range of products". But while criticism of the order traditionally centred on the ban on below-cost selling, Tesco said the wholesale price issue was "much more important" for consumers.

"The most damaging element to consumers of the order is the requirement for suppliers to charge all retailers at the same price, which could be argued is legalising the concept of price-fixing at the wholesale level. We believe this is the only sector in Ireland where standard price-fixing is permitted," Tesco said.

"This, along with the ban on below-cost selling, frustrates the application of normal market-driven or competitively negotiated supply arrangements, and operates against the consumer's interest. This measure prevents price competition at the wholesale level."

Tesco added that withdrawing the order or the abolition of standard wholesale price-fixing would "increase the flexibility to reduce prices for consumers across a wider range of products".

While abolition would be the best option for consumers, Tesco said that some modifications would serve to only worsen their position.