Iceland Managing Director Richard Walker has accused discount chains Aldi and Lidl of using “legal tricks” to stifle competition in retail parks.
Walker claims Aldi and Lidl exploit restrictive covenants in property deals to prevent rivals from opening nearby stores.
The Competition and Markets Authority (CMA) has scrutinised these covenants, preventing competitors from establishing shops in proximity.
However, Aldi and Lidl are not subject to these rules.
This is because they were not included in the 2010 market investigation that established these regulations due to their smaller size at the time.
On LinkedIn, the Iceland boss wrote: “A priority for the Labour government is tackling the after-effects of the cost-of-living crisis…
“But more can be done to promote competition among supermarkets, not least revisiting the snappily-titled Groceries Market Investigation (Controlled Land) Order 2010: these ban restrictive land agreements, which actively prevent competition between supermarkets by prohibiting other retailers from opening within the same area.
“The German-owned supermarkets were just a twinkling in the CMA’s eye when this order was first made.”
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He added: “Fourteen years on, and with the return of a Labour government, surely it is time to look at how the active use of these legal tricks is preventing competition on retail parks in towns across the UK.”
Under the 2010 order, major UK supermarkets such as Tesco, Sainsbury’s, Asda, Morrisons, Waitrose, M&S, and Co-op are prohibited from using restrictive covenants.
However, Aldi and Lidl, which have recently made headlines with their expansion plans and market share achievements, are not bound by these restrictions.
Aldi has confirmed its adherence to planning and competition laws and recently announced plans to open 10 new stores in the UK.
