The supermarket industry is bracing itself for a potential forced sale of land to allow rivals to open areas where it is deemed there is not enough competition.
The UK’s regulatory body Competition Commission is preparing to release a report detailing its provisional recommendations at 4.30pm today following up its initial findings last October where it said it was concerned that parts of the industry prevented or restricted competition.
It is thought that planning issues will form a central part of the recommendations and the inquiry, led by chairman Peter Freeman, could recommend changes to the process of ‘land banking’. While industry sources say the commission may stop short of forcing supermarkets to sell land it could recommend the sale of land if not developed within a certain amount of time.
Other changes are expected to encourage greater availability of land for development outside the Town Centre.
The commission will also outline the extent to which a possible amended planning test should recognise quantitative and qualitative aspects of need, rather than the existing needs test. While the much documented ‘fascia test’ could also be introduced which would Foster preferential treatment for retailers that lack a presence in an area.
The RICS head of UK public policy Luke Herbert, said: ‘Although the proposals to change the planning system may prevent one large supermarket chain dominating an area to the disadvantage of another large supermarket chain, wider environmental and social impacts must also be considered by government.
‘Only creating additional large out of town superstores could have a detrimental impact on the sustainability of town centres and the future of the high street as well as encouraging extra car journeys. Real competition comes from promoting a range of choices from large supermarkets to smaller shops not just by encouraging the big chains to face off against each other.’
The inquiry covered ASDA, Co-op, Morrisons, Safeway, Sainsbury’s, Booths, Somerfield, Tesco and Waitrose, and looked at the ease with which new retailers can enter the market. The final report will be due in May this year.
