Watchdog cracks down on ‘anti-competitive’ supermarket land agreements

The Competition and Markets Authority (CMA) says it has acted to protect shoppers by securing pledges from Bradford-headquartered Wm Morrison Supermarkets Ltd and Marks and Spencer plc (M&S) to stop using unlawful anti-competitive land agreements.

These unlawful agreements include restrictions on land being used by a rival supermarket, or restrictions lasting five years or more which stop landlords from allowing competing stores to set up.

The CMA found the retail giants, who respectively hold 8.6% and 3.4% market share in the UK’s £188.1bn supermarket industry, breached the Groceries Market Investigation (Controlled Land) Order 2010.

This was introduced to stop supermarkets imposing new restrictions that block rivals from opening competing stores nearby. The CMA found:

  • Morrisons breached the Order 55 times between 2011 and 2020
  • M&S breached the Order 10 times between 2015 and 2019

The CMA adds that Morrisons currently has the poorest compliance record with the Order it has seen so far.

Although 14 of these restrictions have ended, there are an outstanding 41 restrictions which Morrisons has agreed to address.

The CMA says it has written to both supermarkets outlining the breaches and the actions agreed to improve compliance in future.

Adam Land, senior director of remedies business and financial analysis at the competition watchdog, said: “At a time when the weekly shop is a source of financial pressure for many families, it’s crucial competition between supermarkets is working well to help people get the best deals they can.

“These restrictive agreements by our leading retailers are unlawful. There can be no excuses made for non-compliance with an Order made in 2010, especially when we know the positive impact for shoppers of new stores on the high street.

“Our continued crackdown on these unlawful restrictions is part of our wider action to tackle the cost of living and ensure people benefit from more competition and choice.”