Aldi and Lidl are facing accusations of leveraging outdated property regulations to hinder competitors from opening new stores. Sainsbury’s, Morrisons, and Iceland are pushing for an expansion of the Controlled Land Order to include Aldi and Lidl in the category of “large grocery retailers” due to their significant growth in recent years, moving away from their current classification as “limited assortment discounters.”

Initially introduced in 2010, the rules affect major supermarket chains like Tesco, Morrisons, Sainsbury’s, and Asda. Although Aldi and Lidl were exempted back then due to their smaller size, other supermarkets argue that their market share has surged from under 3% to approximately 20% today.

Aldi is defending its current classification, emphasizing that its strategy of offering consistently lower prices relies on limiting product range. With Aldi operating about 1,050 stores and aiming for 1,500 outlets long-term, and Lidl having over 1,000 sites with plans for 1,100 shops by 2025, the Competition and Markets Authority (CMA) is expected to reach an initial decision in July.

In response to the watchdog’s consultation, Sainsbury’s highlighted the competitive imbalance caused by Aldi and Lidl’s ability to impede other grocery retailers’ entry and expansion in local markets. Richard Walker, executive chairman of Iceland Foods, stressed the importance of applying the same rules to similar market powers, advocating for a level playing field in the UK Groceries Sector.

Morrisons echoed these sentiments to the CMA, emphasizing the necessity of broadening the Controlled Land Order to encompass Aldi and Lidl for fair competition. Aldi, in its submission to the CMA, outlined its operational differences, such as the absence of online services, specialized counters, or larger stores. The Mirror has reached out to Lidl for their input on the matter.