Below cost selling, price flexing and applying restrictive covenants to land. Typical of Tesco? Asda? Sainsbury's? No - it's the Co-operative Group.

The society, which prides itself on its ethical approach to business, this week published an edited version of its submission to the Competition Commission's grocery inquiry, in which it admits to all three of these controversial practices, though it claims mitigating circumstances in each case.

In the submission, the Co-operative denies it has a landbank but owns up to placing restrictions on land sold. Critics of this practice say it stifles competition as it can be used by retailers to prevent rivals building stores near their own.

"In less than [text deleted] of cases since 2000, we have, as a vendor, included a restrictive covenant preventing grocery retail use when disposing of one of our former grocery retail premises. That practice is legal and, we believe, not confined to grocery retail. Given the predominant weighting of our retail grocery estate to stores below 750 sq m, we do not believe these covenants have posed a significant barrier to entry in the local markets in question."

The group also admits it has engaged in below cost selling - but insists the blame for this lies with its rivals. The practice is criticised for sometimes resulting in prices of other goods being artificially hiked - something Morrisons has already admitted to.

The Co-op's submission reads: "No part of our retailing mission encourages below-cost selling. From time to time competitor-led pricing on certain leading items compels us to adopt a similar price position, involving deep discounts on 'standard' prices in order to remain competitive. Very occasionally this will result in our pricing or promoting products below the cost to us. We see this as a regrettable consequence of market pressures."

The society also hints at operating different pricing policies throughout its estate - price flexing. It says: "The format diversity of our 1,700 or so store estate does not lend itself to a single band pricing approach."

Price flexing is unpopular with smaller retailers because they believe powerful retailers can afford to

cut prices locally to wipe out rivals.

The Co-operative Group, which declined our request for an interview, also tells the Commission it believes it should not be bracketed with big chains when the market is defined. "We believe our continued inclusion in this competitor set would be misplaced as our stores in excess of 1,400 sq m no longer exercise a constraint on those operators addressing the one-stop shopping mission.

"A survey conducted on our behalf in five towns and cities ... where the local market featured one of our stores in excess of 1,400 sq m, found that less than [text deleted] of the survey respondents used that store for one-stop shopping.

"Across the locations we were, however, identified as the second most popular venue for top-up shopping."

On suppliers, the Co-op says: "Quite deliberately, we do not enter into exclusive arrangements with our suppliers as we do not believe these promote the good health of the UK or international supply chain in overall terms. We are reluctant for suppliers to become over-dependent on us."