Revealed, land deals behind growth of Tesco Nation.
Quote From: Daily Mail ­ Thursday 4 th May 2006.

Damning evidence has emerged that Tesco is trying to kill competition and prevent rivals from building stores.

Britain 's richest retailer is accused of using its financial muscle to create a land bank.

The company is buying land and selling it on wrapped in legal covenants which prevent it from being developed as a supermarket or even a corner shop.

This leaves Tesco in pole position to open more sites and increase its market share from 30 per cent to 45 per cent.

The Office of Fair Trading, which fears this could distort the market and stifle competition, is to ask the Competition Commission to investigate the land bank as part of its wider inquiry into the power of the big supermarkets.

Tesco unveiled profits of “2.5billion last week and announced plans to open 125 stores in the coming year.

Its manipulation of land sales is revealed in Land Registry documents for a site close to the centre of Cheshunt , Hertfordshire. The town is home to Tesco HQ plus two of the company's stores.

In July 2000, it bought a 3.2 acre plot at a site some 400 yards from one of the stores.

Tesco sold off most of the land three years later at a loss of £1.23million. The sale included a list of legal covenants that would prevent any rival from building a supermarket on it for at least 25 years.

The company said it had considered moving one store to the new location, but changed its mind. A spokesman added: “We rarely use restrictive covenants. Usually, they are used because there is a stipulation by the local council.”

Last week Tesco chief executive Sir Terry Leahy denied the existence of a land bank.

But a spokesman for the New Economics Foundation think tank warned that the company is abusing the planning system.

“Swift action must be taken before the Tescopoly of Britain is complete,” she said.

Friends of the Earth said: “Tesco once again seems to be cheating the system to get its way and stamp out choice.”