The UK’s Competition and Markets Authority (CMA) has released the responses to its public consultation on whether German supermarket chains Aldi and Lidl should be considered large retailers when opening new stores.

The CMA received six submissions, including one from Aldi, three from other supermarkets, one from the Association of Convenience Stores and an individual submission from an unnamed member of the public.

If Aldi and Lidl are designated as Large Grocery Retailers (LGRs), they will be barred from signing land leases with clauses preventing the opening of other grocery stores nearby.

The three responding supermarkets not implicated in the consultation, Morrisons, Sainsbury’s and Iceland, all argued that the pair should be considered LGRs under CMA guidelines. Their arguments focused on the pair’s rapid expansion in the UK and marketing that brands them as major supermarkets.

Both Iceland and Sainsbury’s, which issued the most detailed responses, pointed to the geographic distribution of Aldi and Lidl, arguing that their coverage across the UK counts as “substantial”, a significant test for whether supermarkets should be designated as LGRs.

The submissions also drew attention to marketing by Aldi and Lidl that positions them as full-service grocery retailers, regardless of their lower number of items for sale. Morrisons noted that Aldi states its stores offer “everything you need (and more!) for your big weekly shop" across a "huge range of tasty groceries”, while Lidl states that “you'll find all you need for your weekly shop at great prices in our stores”.

Sainsbury’s also pointed out that their market share totals 18.9 per cent of take-home grocery spending in the country. The supermarket argues that a share of this magnitude cannot be explained by occasional or supplementary purchases, and is instead consistent with their use for a main grocery shop.

Aldi’s submission argued that it should not be designated as an LGR. Its focus is on core product range, which the supermarket claims is only seven to 10 per cent that of LGRs, and price.

Aldi said its prices are consistently 15 to 21 per cent lower than those of the Big Four: Tesco, Sainsbury’s, Asda and Morrisons. It added that these savings are only achievable through its limited range, which gives the supermarket advantages in efficiency.

Finally, Aldi argued that its presence increases, rather than decreases, competition, noting the prevalence of Aldi Price Match schemes from LGRs.

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