Discount supermarket chains Aldi and Lidl could soon be required to adhere to the same land acquisition rules that apply to other major grocers, following an investigation by the Competition and Markets Authority (CMA). Currently, Aldi and Lidl are not bound by the Controlled Land Order, a regulation introduced in 2010 that prevents supermarkets from placing restrictions on land to block competitors from opening nearby stores.
Competition Concerns Raised by Rivals
Morrisons and Iceland have accused Aldi and Lidl of stifling competition by exploiting outdated rules. In a letter to the CMA, Sainsbury's stated: "Strong and fair competition in the grocery retail market is essential to driving growth in the UK economy. However, competition is currently distorted by the asymmetric ability of Aldi, the fourth largest grocery retailer in the UK, and Lidl, the fifth largest grocery retailer in the UK, to restrict entry and expansion by competitor grocery retailers in local markets, while equivalent restrictions apply to other retailers of comparable or smaller scale."
Iceland's Executive Chairman Speaks Out
Richard Walker, executive chairman of Iceland Foods, emphasized: "Our position is simple: the same rules should apply to the same type of market power. It would be neither rational nor reasonable for Aldi and Lidl to be allowed to wriggle out of this. If land restrictions can prevent rival grocers from opening near customers, then that matters for competition, choice and prices, especially in communities where household budgets are already under pressure. Consumers deserve access to Iceland stores, and the CMA can make this easier. We welcome the CMA’s work in looking at whether the rules remain fit for today’s market and hope it will make the right decision for competition and consumers across the UK."
Morrisons Calls for Level Playing Field
In a written statement to the CMA, Morrisons said: "Morrisons considers that expanding the scope of the Controlled Land Order to include Aldi and Lidl is necessary to ensure a level playing field within the UK Groceries Sector." The CMA is now reviewing whether the rules should be updated to include Aldi and Lidl, which have grown significantly since the order was implemented.
