From next month businesses will be able to apply to the Office of Fair Trading for the removal of land use restrictions which limit competition against any of the UK’s seven largest grocery retailers.
This measure, which comes into force on July 1, is designed to help shoppers benefit from increased local competition, and has been put in place following the Groceries Market Investigation (Controlled Land) Order made by the Competition Commission in 2010.
The Order was made as a result of the Competition Commission’s investigation into the grocery market which found that the existence of certain restrictive covenants and exclusivity arrangements could protect supermarkets from local competition from rival grocery outlets. This new procedure allows these restrictions to be challenged.
The procedure will involve the OFT testing the extent of grocery competition in a given local area when an application is made. This analysis will determine whether a restrictive covenant or exclusivity arrangement benefiting Asda Stores Limited, Co-operative Group Limited, Marks and Spencer plc, Wm Morrison Supermarkets plc, J Sainsbury plc, Tesco plc, or Waitrose Limited should be lifted.