Bowen questioned over effects test stance

Federal Labor MPs have questioned the party's position in opposing the introduction of an effects test to limit the market power of large companies.

Shadow treasurer Chris Bowen confirmed last week Labor would oppose an effects test because it would be bad for business confidence and push up the cost of groceries.

However, three MPs questioned the policy position in the caucus room on Tuesday arguing the competition test could be useful in limiting the market power of retail giants such as Coles and Woolworths.