Tesco has breached competition law by preventing landlords from letting sites near its own supermarkets to rivals, the UK competitions regulator has ruled.
The Competition and Markets Authority (CMA) said the multiple had breached an order put in place in 2010 to stop retailers from entering long exclusivity arrangements with landlords. Tesco had breached the order on 23 occasions between 2010 and 2015. Twenty of the breaches occurred near Tesco Express sites across the UK.
Andrea Gomes da Silva, executive director of markets and mergers at the CMA, said: “It’s unacceptable that Tesco had these unlawful restrictions in place for up to a decade. By making it harder for other supermarkets to open stores next to its branches, shoppers could have lost out.
“In the future, we want the ability to fine businesses if we find that they are in breach of our orders. That’s why we’ve called on the Government for more powers.”
Following the breaches, Tesco has agreed to work with the CMA and review all of its land agreements and take remedial action. This includes improving its own internal processes and providing training to staff.
A Tesco spokesperson said: “We do not use restrictive property agreements. However, in a small number of historic cases between 2010 and 2015, administrative errors by former advisors meant that our internal processes were not followed correctly.
“As the CMA recognises, we have worked collaboratively in resolving this, and our voluntary review of 5,354 land deals found isolated issues in just 0.4% of these. We have since strengthened our controls and training, and are releasing the affected parties from all non-compliant terms.”
The CMA has also asked Waitrose, Sainsbury’s, Asda, Morrisons, Marks and Spencer and the Co-op to show they have not also breached the order.