Supermarket giant Tesco's threat to the small retailer has potentially increased after the chain won a 'competition test'.


The Competition Appeal Tribunal yesterday (March 4) published its judgment on Tesco's appeal against a Competition Committee plan, and found in the supermarket's favour.

Tesco was fighting the scheme that would mean planning permission for new store would be dependent on the number of outlets the chain already had in the area.

It meant that if the chain applying for permission was well represented then other chains should be allowed to develop sites while the apllicant chain was blocked.

However, the ruling does also give Tesco the green light to continue its seemingly unstoppable expansion of its various formats.

Tesco successfully argued that 'there are a good many reasons why, if one retailer is blocked from developing a store, a replacement development by a different retailer may not occur.'

The CAT, presided over by Justice Barling, concluded the Competition Commission did 'not fully and properly assess and take account of the risk that the application of the test might have adverse effects for consumers'.

Tesco executive director for corporate and legal affairs, Lucy Neville-Rolfe, said: "We are delighted with the judgment, which is a victory for common sense, and endorses our view that the proposed competition test was ill-founded.

"A new test in the planning system would increase costs and make the process even slower and more bureaucratic. It would be particularly perverse to introduce a test that would block investment in the current economic climate.

"We would now like to draw a line under this and get back to focusing on customers in these challenging times."

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