The UK Competition and Markets Authority (CMA) has formally designated Aldi Stores Limited, Lidl Great Britain Limited and Lidl Northern Ireland Limited as “Large Grocery Retailers” under the Groceries Market Investigation (Controlled Land) Order 2010. The decision, published on October 22, 2026, ends a 16-year carve-out that let the two German-owned discounters write land agreements their bigger rivals have been barred from using since 2010.
In practical terms, Aldi and Lidl can no longer put new restrictive covenants into property deals that stop another grocer from trading on a site, and they cannot hold new exclusivity arrangements for more than five years after a store opens. Landowners, developers and rival supermarkets can also now ask the CMA to test existing agreements that benefit the two chains. It is the first time any grocer has been added to the list since the Order took effect.
In short
- Final decision: the CMA designated Aldi, Lidl GB and Lidl NI as Large Grocery Retailers on October 22, 2026, confirming its August provisional view.
- New limits: the three companies can no longer sign new restrictive covenants that block grocery retailing, or exclusivity arrangements lasting more than five years from a store’s opening.
- Existing deals exposed: landowners and rivals can ask the CMA to apply a local competition test to existing restrictions; the CMA says a share of each chain’s agreements contain the relevant clauses.
- Why now: Aldi holds a 10.8% and Lidl GB an 8.6% share of the Great Britain grocery market, per Worldpanel data cited by the CMA, against 1.3% and 1.5% in 2008.
- No pushback: neither Aldi nor Lidl made representations on the provisional decision; Morrisons, Waitrose and Iceland all backed it.
What exactly did the CMA decide on October 22?
The CMA’s final decisions report, signed by Juliette Enser on behalf of its Case and Policy Committee, makes three parallel findings. Aldi Stores Limited, Lidl Great Britain Limited and Lidl Northern Ireland Limited are each “no longer” Limited Assortment Discounters (LADs) for the purposes of the Order. Each meets the three designation criteria in Article 3(4). Each is therefore designated as a Large Grocery Retailer (LGR) under Article 3(3).
That puts the two discounters alongside the seven retailers named in the Order when it was made in August 2010: Asda, Co-op, Marks and Spencer, Morrisons, Sainsbury’s, Tesco and Waitrose. According to the CMA, neither the Office of Fair Trading nor the CMA had designated any additional grocer under the Order before this decision.
“We put in place rules to stop big supermarket chains from blocking rival stores opening in their area,” Enser said in the CMA’s press release, adding that the change “will help level the playing field and make sure shoppers get the best choice of products and prices in their area.” The regulator puts the UK food and grocery market at an estimated £222.7 billion (about USD 298 billion at the current rate of roughly USD 1.34 per pound).
When the Competition Commission ran its original market investigation, Lidl UK GmbH operated across the whole of the UK. Lidl’s UK business has since been split: Lidl GB runs stores in England, Scotland and Wales, while Lidl NI runs the Northern Ireland estate. The CMA assessed each entity separately and designated both, so the obligations attach to Lidl’s grocery operations across the whole UK. Aldi has no stores in Northern Ireland, so only Aldi Stores Limited was in scope.
What is the Controlled Land Order and what does it ban?
The Order is a remedy that came out of the Competition Commission’s groceries market investigation, which began after a reference from the Office of Fair Trading in May 2006 and reported on April 30, 2008. The Commission found high concentration in many local grocery markets and concluded that incumbent supermarkets were using land controls to keep rivals out of those areas.
Two tools were at the center of that finding. A restrictive covenant is a restriction, usually imposed when freehold land is sold, that limits what the land can be used for in the future, for example a ban on operating a food store. An exclusivity arrangement is a deal under which a landowner or developer grants one grocer exclusive rights and agrees not to let another grocer trade on sites it owns, such as other units in a retail park.
The text of the 2010 Order sets out a layered regime. Under Article 5, a designated retailer must not enter into any restrictive covenant that “may restrict grocery retailing or have equivalent effect,” nor any agreement with equivalent effect, nor procure one on its behalf. Limited exceptions cover residential-use restrictions and clauses that reflect planning agreements, such as Section 106 obligations in England and Wales.
Under Article 8, a designated retailer must not enter into an exclusivity arrangement that restricts grocery retailing for longer than five years from the date its benefiting store first began trading. For existing restrictions, Articles 4 and 7 allow the owner of burdened land, a party to an exclusivity deal, or any company wishing to develop a grocery store on the site to apply to the competition authority. If the restriction fails the Order’s competition test, the retailer must use its best endeavours to release a covenant, without charge, within a period of three to six months set by the authority, or stop enforcing an exclusivity arrangement.
How the local competition test works
The test in Schedule 4 of the Order is mechanical. The authority draws a 10-minute drive-time isochrone around the burdened site and around the retailer’s associated stores, then counts the distinct grocery fascias operating larger stores inside it. If there are four or more fascias, the restriction passes. If there are three or fewer, the authority calculates the benefiting retailer’s share of grocery sales area in that zone: 60% or more fails the test, less than 60% passes.
The Order also carries an exception for “operational” restrictions that are genuinely needed to run a store, such as rules over a shared car park or service yard, provided the retailer does not gain exclusive use of infrastructure another grocery store also needs. Article 11 of the Order separately requires designated retailers to notify the authority within four weeks of agreeing to acquire a larger grocery store or an interest in a site used as one in the previous 12 months.
| Rule in the 2010 Order | What it requires | Who can trigger it |
|---|---|---|
| Article 5: new restrictive covenants | Ban on new covenants that restrict grocery retailing or have equivalent effect | Applies automatically |
| Article 8: new exclusivity arrangements | No exclusivity lasting more than five years from the store’s opening | Applies automatically |
| Article 4: existing covenants | Release within three to six months if the local test is failed | Owner of the burdened land |
| Article 7: existing exclusivity | Stop enforcing once the test is failed and the time limit has passed | Party to the deal, or a grocer wanting to open on the site |
| Schedule 4: competition test | Fail if three or fewer fascias and a 60%+ share within a 10-minute drive | Applied by the CMA on application |
| Article 11: store acquisitions | Notify the authority within four weeks of agreeing to buy a larger store or former store site | Applies automatically |
Why were Aldi and Lidl exempt in the first place?
In 2008 the two chains looked like a different business. The Commission found that Aldi and Lidl each carried roughly 1,000 to 1,400 product lines in stores of 500 to 1,400 square meters, compared with around 5,000 products in similarly sized stores operated by large grocers, and 5,000 to 10,000 across the large-grocer estate. It concluded the discounters were not close substitutes for the big supermarkets and classed them, together with Netto, as Limited Assortment Discounters.
The Order defines a LAD as a grocery retailer “which sells a significantly more limited range of Groceries than a Large Grocery Retailer at a low price.” Crucially, stores run by LADs were carved out of the definition of a “Grocery Store,” which meant a LAD could not be designated at all. As long as Aldi and Lidl qualified as LADs, the land rules simply did not reach them.
Market share reinforced that view at the time. The Commission estimated that the large grocers held about 85% of UK grocery sales in 2008, with the four biggest at just over 65%. Aldi and Lidl accounted for 1.3% and 1.5% respectively.
What changed between 2008 and 2026?
The CMA’s answer is: almost everything except the price position. Its report traces a steady climb. By the time of the 2019 Sainsbury’s and Asda merger inquiry, Aldi and Lidl had more than doubled their combined share in Great Britain to around 13%, with Aldi the fifth-largest grocer at 7% and Lidl eighth at 5%. They still stocked around one-fifteenth of the product lines of a large “big four” supermarket.
The latest Worldpanel data cited in the decision, for the 12 weeks to May 17, 2026, shows Aldi at 10.8% and Lidl GB at 8.6% of the Great Britain grocery market. That makes Aldi the fourth-largest grocer after Tesco, Sainsbury’s and Asda, with Lidl GB fifth. Both now have larger shares than Morrisons, Co-op, Waitrose and M&S. Worldpanel had Aldi at 8.5% and Lidl at 5.4% in early 2020, so Aldi’s share has grown by more than a quarter and Lidl GB’s by more than half since then.
In Northern Ireland, Lidl NI told the CMA its share was 9.7% in 2026; Kantar data for 2025 put it at 9.5%, making it the province’s fourth-largest grocer. Mintel figures cited in the report are slightly lower for 2025 (9.2% for Aldi and 6.3% for Lidl across the UK) but tell the same story of growth from 7.8% and 4.4% in 2020.
| Measure | 2008 (Competition Commission) | 2019 (Sainsbury’s/Asda inquiry) | 2026 (CMA final decision) |
|---|---|---|---|
| Aldi market share | 1.3% (UK) | 7% (UK), fifth largest | 10.8% (GB), fourth largest |
| Lidl market share | 1.5% (UK) | 5% (UK), eighth largest | 8.6% (Lidl GB), fifth largest; 9.5% to 9.7% in NI |
| Typical product count | About 1,000 to 1,400 lines | About one-fifteenth of a big-four store’s lines | 4,000 to 5,000 SKUs in 1,000 to 2,000 sq m stores |
| Regulatory status | Limited Assortment Discounter | Limited Assortment Discounter | Large Grocery Retailer |
How the range gap narrowed
The CMA compared average grocery SKU counts in stores with a net sales area of 1,000 to 2,000 square meters, using ranges to protect confidential data. Aldi, Lidl GB and Lidl NI each carry between 4,000 and 5,000 SKUs. Among the existing large grocers, M&S carries 6,000 to 7,000, Tesco and Co-op 9,000 to 10,000, Morrisons 12,000 to 14,000, and Asda, Sainsbury’s and Waitrose 18,000 to 20,000.
The gap is still real, but the CMA leaned on its own precedent. In 2008 the Commission kept M&S inside the large-grocer market even though it carried fewer SKUs and sold almost entirely own-label goods, because it offered “the same broad product range as large retailers.” The CMA applied the same logic here, finding that the remaining differences relate to the depth of choice within categories, especially branded and specialist lines, rather than the absence of core categories. Own-brand products make up 90% to 100% of grocery SKUs at Aldi and 80% to 90% at Lidl, comparable with M&S at 90% to 100% and far above the 20% to 40% range at the other large grocers.
The report also notes a measurement quirk: Aldi’s internal reports counted its range at 2,000 to 3,000 products, but when flavor and size variants were split out the figure rose to 4,000 to 5,000 SKUs. Trade coverage has framed this as the discounters understating their ranges, though the CMA itself presents it as a difference in how retailers define a product.
Can shoppers really do a weekly shop at Aldi and Lidl?
This was the heart of the dispute, and the only point on which Aldi pushed back during the 2026 process. In its response to the CMA’s invitation to comment in spring, Aldi argued that customers cannot complete a main weekly shop at Aldi equivalent to one at a large grocer, especially for branded goods. It said its research showed that a large majority of its shoppers’ spend still went to other retailers.
Rivals argued the opposite. Sainsbury’s told the CMA that Aldi and Lidl’s combined share of close to 20% of UK take-home grocery spending could not be explained by occasional purchases, and that 40% to 60% of Aldi and Lidl GB volumes are sold as part of a main shop. Morrisons pointed to the discounters’ own advertising: the CMA quotes Aldi promising “everything you need (and more!) for your big weekly shop” and Lidl telling customers “you’ll find all you need for your weekly shop at great prices in our stores.” Sainsbury’s also cited a 2018 statement by Lidl, during the Sainsbury’s and Asda merger hearings, that it tries “to offer every product required for a full weekly shop.”
Survey data in the report supports the rivals. In a consumer survey cited by the CMA on which grocer respondents use for their main grocery shopping, Tesco led with 32%, followed by Sainsbury’s at 14%, Asda at 13%, Aldi at 12%, Lidl at 10% and Morrisons at 8%. On that measure, Aldi and Lidl each outrank Morrisons, an original 2010 designee.
Price matching as evidence of rivalry
The CMA gave weight to how the incumbents behave. Four of the seven existing large grocers run explicit price-match schemes against the discounters: three match Aldi, and one matches both Aldi and Lidl GB. Coverage ranges from more than 100 grocery SKUs at Co-op to more than 800 at Sainsbury’s, typically everyday essentials and best sellers. The regulator treats that behavior as evidence that the big chains see Aldi and Lidl as a direct competitive constraint, not a niche alternative.
How much cheaper are Aldi and Lidl than the big supermarkets?
The decision did not turn on price, because both limbs of the LAD definition must be met and the CMA found the range limb no longer applies. But the report confirms the discounters remain the cheapest grocers in the market. Based on all the comparisons it received, the large grocers were at least 5% to 10% more expensive than each of Aldi, Lidl GB and Lidl NI.
The CMA also cites the consumer group Which?, which compares a basket at eight major supermarkets each month. In April 2026, a 96-item basket averaged £172.77 at Aldi (about USD 232) and £175.20 at Lidl with its Lidl Plus loyalty prices. Asda, Tesco with Clubcard, Sainsbury’s with Nectar and Morrisons ranged from £197.91 to £205.31, between 15% and 19% more than Aldi. Waitrose was the most expensive at £242.04 (about USD 324), 40% above Aldi.
That price gap matters for shoppers squeezed by food inflation, which industry bodies expect to stay elevated into the Christmas season, as shown in the Food and Drink Federation’s Christmas food inflation forecast. The CMA’s stated aim is that more local competition, including more discounter stores and more rival stores near discounters, should keep that pressure on prices.
| Retailer (Which?, April 2026) | Average 96-item basket | Approx. USD | Gap vs Aldi |
|---|---|---|---|
| Aldi | £172.77 | $232 | Cheapest |
| Lidl (with Lidl Plus) | £175.20 | $235 | About 1% more |
| Asda, Tesco, Sainsbury’s, Morrisons (loyalty prices where relevant) | £197.91 to £205.31 | $265 to $275 | 15% to 19% more |
| Waitrose | £242.04 | $324 | 40% more |
How many Aldi and Lidl sites could be affected?
The CMA has not counted affected agreements, and it is explicit that it has not assessed any of them against the Order. What it has published is the result of an exercise it ran in 2025, when it asked each company whether its land agreements contained restrictive covenants or exclusivity arrangements.
Aldi reviewed a 10% sample of its existing land agreements and reported that 50% to 60% of the sample contained a restriction on grocery retailing, though the published report notes that figure includes items the CMA redacted. Lidl GB also sampled 10% and reported restrictions in 10% to 20% of the sample. Lidl NI reviewed all of its agreements and found restrictions in 20% to 30%. The CMA says only that, for each retailer, “a proportion” of agreements contain the kind of restriction the Order can reach.
The store base those agreements sit under is large. As of February 28, 2026, Aldi operated 1,085 grocery stores in Great Britain (908 in England, 112 in Scotland and 65 in Wales), of which 785, or 72%, exceed the Order’s 1,000 square meter threshold. Lidl GB operated 1,016 stores (842 in England, 113 in Scotland and 61 in Wales), 881 or 87% of them above the threshold. Lidl NI ran 44 stores, 35 of them above the threshold.
| Metric (as of Feb 28, 2026) | Aldi | Lidl GB | Lidl NI |
|---|---|---|---|
| Grocery stores | 1,085 | 1,016 | 44 |
| Stores over 1,000 sq m | 785 (72%) | 881 (87%) | 35 (80%) |
| Average store size | 1,080 sq m | 1,225 sq m | 1,262 sq m |
| Land agreements with restrictions (self-reported, 2025) | 50% to 60% of a 10% sample | 10% to 20% of a 10% sample | 20% to 30% of all agreements |
Why the test may bite in fewer places than the numbers suggest
The existing-agreement route is not automatic. Someone with an interest in the burdened land has to apply, provide information, and then the restriction has to fail the local test. Because the test passes wherever four or more grocery fascias operate larger stores within a 10-minute drive, many suburban and urban sites are likely to clear it. The pressure is most likely in smaller towns and edge-of-town retail parks where only two or three large-store brands trade.
What does this mean for Aldi and Lidl’s store expansion?
Both chains are in the middle of aggressive opening programs. City AM reports that Aldi and Lidl have each been reported to target around 1,500 UK stores, and Aldi has been opening roughly a store a week this autumn as part of that push. Morrisons told the CMA it understands both chains’ future plans center on stores larger than 1,000 square meters, which would fall squarely inside the Order.
The companies’ public line is that nothing changes. An Aldi spokesperson told City AM the business remains “firmly committed to opening hundreds of new stores across the country.” A Lidl spokesperson said that, as a discounter, Lidl has “always welcomed and embraced competition within the market” and that its focus remains on opening new stores. Both made similar comments in August, when the provisional decision was announced.
What the decision changes is the deal structure around those openings, not their number. Developers and landowners selling or leasing plots to the discounters can no longer be asked to sign covenants that keep other grocers off neighboring land, and exclusivity on a retail park is capped at five years from opening. That makes adjacent plots more valuable to other grocers and narrows one way a newly opened store could protect its catchment.
A less discussed consequence is the Order’s acquisition clause. Under Article 11, a designated retailer must notify the authority within four weeks of agreeing to acquire a larger grocery store, or an interest in a site used for one in the previous 12 months. Any future purchase of an existing large supermarket, or of a recently used supermarket site, by either chain will now come with that notification step attached.
Who pushed for the change, and why?
The case opened on March 12, 2026, with an invitation to comment that closed on April 13. Responses came from Aldi, the Association of Convenience Stores, Iceland, Morrisons, Sainsbury’s and one individual. The CMA had used its statutory information-gathering powers on Aldi, Lidl GB, Lidl NI and all seven existing large grocers. The CMA proposed bringing Aldi and Lidl under the land rules in August, publishing a provisional decisions report on August 7 and inviting views until September 7.
Four parties responded to the provisional findings: Morrisons, Waitrose, Iceland and an anonymous shopper. All supported designation. Aldi, Lidl GB and Lidl NI told the CMA shortly after the deadline that they would not make representations and declined the offer of a meeting.
Iceland, which is not covered by the Order and is classed as a frozen food retailer, was the most forceful. In its September 7 submission it argued that the business model, strategy and scale of Aldi and Lidl “have evolved materially over the sixteen years since the CLO was enacted.” City AM quotes Iceland’s view that the old rules let Aldi and Lidl “deploy problematic land arrangements” at scale. Waitrose, whose recent trading is covered in our report on the John Lewis Partnership’s half-year loss, told the CMA it had seen Lidl use land agreements to “restrict the ability of other grocery retailers to open new stores and shield Lidl from local competition,” according to City AM, and urged a decision “without further delay.”
Morrisons made two points the CMA highlighted in its final report. First, its own price-match scheme includes SKUs in categories that Aldi and Lidl had cited as examples of where their ranges are thinner. Second, it is possible to compete for a very large share of customers’ spend with fewer SKUs, because a small number of products account for a large share of sales. The CMA said both points further supported its provisional view.
How does this fit the CMA’s wider grocery agenda?
The decision is part of the CMA’s routine duty to monitor and enforce existing orders, rather than a new market investigation. It follows the regulator’s broader work on grocery prices and competition since the cost-of-living squeeze, and sits alongside merger control in the sector, such as its review of Co-op’s takeover of Southern Co-op, where local store overlaps drove the remedy discussion.
The decision does not touch the separate Groceries (Supply Chain Practices) Market Investigation Order 2009, which underpins the Groceries Supply Code of Practice governing how large retailers treat suppliers. The CMA’s report notes that the 2008 inquiry produced both instruments, and that this assessment concerns only the land order.
The designation also closes a gap the Competition Commission anticipated. In 2008 it considered limiting the remedy to the retailers named in its report but rejected that approach because “the composition of large grocery retailers under its market definition could change over time.” It built in the designation mechanism precisely so the list could be updated. The October 22 decision is the first time that mechanism has been used.
What happens next?
The case is now closed and the designations take effect as published decisions under Article 3(3) of the Order. From here, the work shifts to applications. Any landowner whose site is burdened by an Aldi or Lidl covenant, any party to an exclusivity arrangement benefiting either chain, and any grocer that wants to open on a restricted site can apply to the CMA for the competition test to be applied.
Watch for three signals over the coming months. The first is whether rival grocers, particularly Iceland, Morrisons and Waitrose, file early applications against specific discounter sites they have been blocked from. The second is whether retail park landlords begin marketing plots that were previously off-limits to food retailers. The third is whether either discounter challenges the decision; neither engaged with the provisional findings, which suggests a legal fight is unlikely.
For international retailers watching UK property, the precedent is clear: a discounter that grows into a mainstream grocer will eventually be regulated like one. The CMA did not find that Aldi or Lidl had abused anything. It found that they had become big enough for the same rules as everyone else.
Frequently asked questions
What did the CMA decide about Aldi and Lidl?
On October 22, 2026, the CMA designated Aldi Stores Limited, Lidl Great Britain Limited and Lidl Northern Ireland Limited as Large Grocery Retailers under the Groceries Market Investigation (Controlled Land) Order 2010. They now face the same land-agreement rules as Asda, Co-op, M&S, Morrisons, Sainsbury’s, Tesco and Waitrose.
What is a restrictive covenant in UK grocery?
A restrictive covenant is a restriction, usually attached when land is sold, that limits its future use. In grocery, a supermarket selling surplus land might require that no food store ever operates there. The Order bans designated retailers from entering into new covenants that restrict grocery retailing.
What is an exclusivity arrangement?
It is a deal in which a landowner or developer agrees to let only one grocer trade on a site or group of sites, such as a retail park. Designated retailers cannot enter into exclusivity arrangements lasting more than five years from the date their store first opens.
Does this stop Aldi and Lidl opening new stores?
No. The Order does not limit store numbers. It limits the land terms attached to sites. Aldi told City AM it remains committed to opening hundreds of new stores, and Lidl said its focus remains on new openings.
Will existing Aldi and Lidl land deals be cancelled?
Not automatically. A landowner, a party to the agreement or a grocer wanting to open on the site must apply to the CMA. The restriction is only released or made unenforceable if it fails a local competition test based on the number of grocery brands and the retailer’s share of store space within a 10-minute drive.
Why were Aldi and Lidl exempt until now?
In 2008 they carried around 1,000 to 1,400 product lines and held under 2% of the market each, so the Competition Commission classed them as Limited Assortment Discounters, which the Order excludes. The CMA now finds they carry 4,000 to 5,000 SKUs in comparable stores and hold 10.8% (Aldi) and 8.6% (Lidl GB) of the Great Britain market.
Did Aldi or Lidl object to the decision?
Aldi argued in its spring submission that shoppers cannot complete an equivalent main weekly shop at its stores. However, neither Aldi nor either Lidl entity made representations on the August provisional decision, and both declined a meeting with the CMA.
Is Iceland covered by the new rules?
No. Iceland is not a designated Large Grocery Retailer; the Order excludes frozen food retailers from its definition of a grocery store. Iceland supported the designation of Aldi and Lidl throughout the process.
Does this affect the Groceries Supply Code of Practice?
No. The supplier code comes from a separate 2009 order. The October 22 decision concerns only the 2010 Controlled Land Order and the use of land agreements to block rival stores.