United Kingdom

Tesco broke the law by making landlords sign 'exclusivity' contracts to block rival supermarkets

Tesco has been slammed by a watchdog for breaking the law by blocking rivals from opening up shops near its stores.

Britain’s biggest retailer has prevented competitors from opening supermarkets in 23 locations in the UK, the Competition and Markets Authority watchdog said.

It said the practice, which went on for up to a decade, may have left shoppers ‘worse off’ by reducing competition and choice on the High Street.

Tesco prevented competitors from opening supermarkets in 23 locations in the UK, the Competition and Markets Authority watchdog said (file image)

In 20 cases, Tesco would stipulate with landlords that they could not rent out premises on the same site to a rival for 20 years or longer.

The CMA said these ‘exclusivity’ deals broke the law as companies are only allowed to make such demands in contracts for up to five years.

And when selling land, the retailer imposed legal conditions preventing the new owner from letting the site to another supermarket.

Competition and Markets Authority watchdog said the practice, which went on for up to a decade, may have left shoppers ‘worse off’ by reducing competition and choice on the High Street (file image)

Andrea Gomes da Silva of the CMA called the retailer’s actions ‘unacceptable’.

Tesco said that ‘in a small number of historic cases administrative errors by former advisers meant our internal processes were not followed correctly’.