Aldi and Lidl will be subject to same rules as major supermarkets

The Competition and Markets Authority (CMA) has decided that Aldi, Lidl GB and Lidl NI will be designated as ‘Large Grocery Retailers’ (LGRs) under the Groceries Market Investigation (Controlled Land) Order 2010.

The Order has applied to Asda, Co‑op, Marks and Spencer, Morrisons, Sainsbury’s, Tesco and Waitrose since 2010. The Order is designed to stop Large Grocery Retailers from using land agreements to make it harder for rival supermarkets to open nearby – in particular through the use of restrictive covenants and exclusivity arrangements. The rules ensure supermarkets compete freely – and ultimately ensure shoppers have more choice about where to buy, and how much to pay for, their groceries.

In August, the CMA invited views on its proposal to designate Aldi, Lidl GB and Lidl NI under the Order. Interested parties including Morrisons, Waitrose and Iceland submitted their views, and all supported the CMA’s proposal. The CMA did not receive representations from Aldi, Lidl GB or Lidl NI.

Once a retailer is designated, it cannot include any prohibited restrictions in new agreements – and existing agreements can be reviewed by the CMA, on the request of interested landowners, developers, and rival supermarkets. This is the case for all designated supermarkets.

Juliette Enser, Executive Director for Competition Enforcement and Markets at the CMA, said:

We put in place rules to stop big supermarket chains from blocking rival stores opening in their area, and now those rules apply to Aldi and Lidl.

This will help level the playing field and make sure shoppers get the best choice of products and prices in their area.

The UK food and grocery market is worth an estimated £222.7 billion, with Aldi and Lidl ranking among the top 5 retailers by market share.

For more information, read the CMA’s final decisions report and supporting documents on the case page.

Notes

1. The Groceries Market Investigation (Controlled Land) Order 2010 was introduced following a groceries market investigation by the CMA’s predecessor organisation, the Competition Commission, and seeks to prevent designated grocery retailers from using restrictive land agreements that could adversely affect competition.
2. Lidl operates separate businesses in Great Britain and Northern Ireland. Lidl GB operates stores in England, Scotland and Wales. Lidl NI operates stores in Northern Ireland. Aldi does not operate stores in Northern Ireland.

source: GOV