Britain's consumer affairs watchdog is to refer the UK grocery market to the Competition Commission for an industry-wide investigation.
The Office of Fair Trading said evidence compiled so far suggested planning regimes act as a costly barrier to entry. It said big supermarkets had significant land holdings which 'could aggravate barriers to entry or otherwise harm consumers'.
The OFT said there was also evidence that big supermarkets' buying power had increased and that some aspects of pricing behaviour could distort competition.
In a statement, Tesco said the OFT's decision was not unexpected. Tesco said the OFT itself had concluded that l consumers had benefited from falling prices, an increase in product range and improved service. 'This is the most important measure of competition and we are confident the Competition Commission will endorse this view,' Tesco added.
