The Competition and Markets Authority (CMA) has provisionally concluded that German‑owned discounters Aldi and Lidl now qualify as Large Grocery Retailers, meaning they could be required to follow the same land‑use rules that bind the UK’s biggest supermarket chains.
Regulatory shift aims to curb restrictive covenants
The watchdog says Aldi, Lidl GB and Lidl Northern Ireland should be brought within the scope of the Groceries Market Investigation (Controlled Land) Order 2010. That order was created to stop major grocers from using restrictive covenants or exclusivity arrangements that make it harder for rival stores to open nearby.
Currently the regime applies to Asda, Co‑op, Marks and Spencer, Morrisons, Sainsbury’s, Tesco and Waitrose. If the CMA’s provisional view is confirmed, they will be subject to the same constraints, marking a notable change from the original 2010 framework that excluded them as limited‑assortment retailers.
The authority points to the scale and geographic spread of the discounters’ store estates, the breadth of their grocery ranges, and the fact that they purchase products directly from suppliers through integrated wholesale operations.
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Why the discounters no longer fit the limited‑assortment label
When the order was first introduced 16 years ago, Aldi and Lidl were excluded because their UK businesses were deemed to sell a narrower range of groceries at low prices. The CMA now says they no longer meet that definition.
Both retailers operate large grocery stores—defined as sites with more than 1,000 sq m of shop‑floor space—across Great Britain and Northern Ireland. Each carries what the regulator considers a full range of groceries, even if choice within some categories remains narrower than at traditional supermarkets.
By bringing them into the regime, the watchdog says it will help ensure they compete on the same basis as other large grocers when securing or developing store sites.
From a shopper’s perspective, the move could mean more competition for prime retail locations, potentially driving down rents and opening up space for new entrants.
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If Aldi and Lidl are forced to negotiate on equal terms, smaller independent grocers might also find it easier to obtain nearby sites, expanding options for local communities.
Next steps and industry response
Juliette Enser, executive director of competition enforcement and markets at the CMA, said, “We want everyone to have the best choice of supermarket and range of prices when buying their groceries. To ensure this happens, we put rules in place to prevent big supermarket chains blocking rival stores from opening nearby – and now we propose applying those rules to Aldi and Lidl too.”
The proposals are provisional and the regulator welcomes views before deciding the best way forward. Stakeholders have until 5 p.m. on Monday 7 September 2026 to respond, with final decisions expected in the autumn.
New research from Savills notes that UK retail parks are becoming “effectively full” as value‑led retailers, including Aldi and Lidl, continue to compete for a shrinking pool of available units. The CMA’s action arrives amid growing pressure on land owners and local authorities to balance the needs of large chains with those of smaller competitors.
