Current arrangements for distributing newspapers and magazines that award local monopolies to wholesalers could harm consumers, the Office of Fair Trading has said.

Releasing its draft opinion on newstrade distribution, the OFT said that it was also launching a fresh review of the Newspaper Code.

John Fingleton, chief executive of the OFT, said: "It is important that this market, as any other, delivers choice, innovation and competitive prices for consumers. This draft opinion questions whether the current system of local monopolies provides sufficient competitive incentives to publishers and wholesalers."