The Competition Commission (CC) has launched an inquiry to determine whether Tesco is restricting competition in the grocery market in Slough, Berkshire. The inquiry will run separately from the CC's ongoing investigation into the national grocery market.
In 2004 the Office of Fair Trading (OFT) ordered Tesco to sell a former Co-op store to a rival grocery chain. It had used the store as a temporary home while its Extra store was built nearby. However, Tesco claims it has been unable to find a buyer and earlier this year bulldozed the store. It is now developing a smaller outlet on the site, but local retailers claim it will not be able to compete with the Extra store, which is four times larger.
The OFT delayed referring the matter to the CC, but has now indicated that its negotiations with Tesco are not making progress and has asked the CC to decide whether the failure to sell the site reduces competition for groceries in the Slough area.
OFT chief executive John Fingleton said: "We allowed the planning process to take its course and gave time for Tesco to come up with suitable purchasers. They have not been able to do so."
Tesco maintains it has attempted to find a buyer, but that those it has put forward have been refused by the OFT. It described suggestions that it might be forced to sell the Extra store as "quite bizarre and entirely disproportionate".
The CC has called for interested parties to submit evidence by May 10 and is expected to report its findings in October.