Aldi and Lidl should face same rules on store openings as rivals, says watchdog

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Aldi and Lidl should be covered by the same land agreement rules as the UK’s largest supermarket chains, the UK competition watchdog has said in provisional findings.

The Competition and Markets Authority (CMA) proposal would prevent the German discount brands from blocking rival supermarkets opening close to their stores.

Rules designed to stop large grocery retailers from using land agreements to make it harder for rival supermarkets to open nearby, particularly through restrictive covenants and exclusivity arrangements, were introduced in 2010.

The restrictions currently apply to seven retailers – Asda, Co‑op, Marks and Spencer, Morrisons, Sainsbury’s, Tesco and Waitrose.

In a provisional decision, the CMA said it believes Aldi, Lidl GB and Lidl NI should also be subject to the rules.

Aldi is the UK’s fourth largest grocer, with a 10.8% share of the market, and Lidl the sixth largest with an 8.8% share, according to recent figures from Worldpanel.

Both Lidl and Aldi have expanded rapidly across the UK in recent years (Andrew Matthews/PA) (PA Archive)

Both companies have rapidly expanded through store openings in recent years, while they have also attracted new shoppers through their discount pricing.

The regulator said the brands were not originally included in the rules due to their more limited range of products, but said they should now be covered by the restrictions after expanding their shop estate and opening larger stores.

The CMA has said it is seeking further views before reaching a final decision.

Juliette Enser, executive director of competition enforcement and markets at the CMA, said: “We want everyone to have the best choice of supermarket and range of prices when buying their groceries.

“To ensure this happens, we put rules in place to prevent big supermarket chains blocking rival stores from opening nearby – and now we propose applying those rules to Aldi and Lidl too.”

An Aldi spokesman said: “The CMA’s provisional decision does not impact our long-term growth plans across the UK.

“We remain firmly committed to opening hundreds of new stores across the country, bringing Aldi’s unbeatable value and award-winning quality to even more customers.”

Lidl has been contacted for comment.