Aldi and Lidl should not be allowed to “wriggle out” of competition rules faced by other supermarkets, according to Iceland boss Richard Walker.
The frozen food retailer’s chairman was commenting on the prospect of Aldi and Lidl arguing their limited ranges meant they should remain exempt from a ban on clauses in property deals that block rivals from opening nearby.
Tesco, Sainsbury’s, Asda, Morrisons, Co-op, M&S and Waitrose have been banned from putting the restrictive clauses in land deals since 2010, and the CMA last week launched a four-week consultation on extending the rules to cover Aldi and Lidl.
Aldi has argued it is “fundamentally different from full-price supermarkets, with a significantly smaller range and a more streamlined operating model”.
Walker told The Grocer: “It simply won’t wash if the German discounters attempt to wriggle out of competition on a technicality.
“The plain fact is they are using anti-competitive leases to keep other retailers away. What are they afraid of?”
Walker has campaigned for the rules to be extended to Aldi and Lidl since 2024, when he called on the then new Labour government to urgently look at the issue.
Aldi pointed out Iceland was also exempt from the rules, and suggested it should therefore face a similar investigation into its use of land restrictions.
Read more: Is it time Aldi and Lidl were roped into restrictive land deals ban?
The discounters and Iceland were not included in the 2010 Controlled Land Order, drawn up by CMA predecessor the Competition Commission, based on differing classifications. Aldi and Lidl were classed as limited assortment discounters [LADs] selling only about 1,000 products, while Iceland was classed as a frozen food retailer along with Farmfoods. Neither class was seen as competing for the same shopping mission as the designated supermarkets.
The consultation is looking specifically at whether Aldi and Lidl should still be considered LADs, and particularly interested in examples of retailers being unable to open a grocery store due to their exemption.
Both Aldi and Lidl stressed they were fully compliant with competition law.
An Aldi spokesperson said: “We are subject to, and compliant with, all general competition law relating to the use of land agreements and are continuing to engage with the CMA during its consultation.”
A Lidl spokesperson said: “As a discounter, we have always welcomed and embraced competition within the market. We operate fully within the law and any party has the ability to challenge a property restriction, should they wish to. We are aware of the CMA’s assessment of Lidl GB under the order and are engaging fully with the process.”
Lidl remained a “limited-range discounter”, selling far fewer product lines than the designated supermarkets, the spokesperson added.
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