Retailers have welcomed the agreement between Coles, Woolworths and the ACCC, which will see restrictive provisions in supermarket leasing agreements phased out.
The decision follows an ACCC Grocery Inquiry in 2008 that found that supermarket operators were including tenancy terms that prevented shopping centre managers leasing space to any competing supermarkets.
Coles and Woolworths have both agreed to remove any restrictive provisions in any new supermarket leases; a decision welcomed by Australian Retailers Association executive director Russell Zimmerman.
“An open retail market free from restrictive and anti-competitive leasing arrangements provides greater choice for consumers in regards to product and price in one location,” he said.
“The announcement allows new entrants to Australia’s supermarket and grocery sector, including ALDI, to take out leases in shopping centres where they have previously been excluded.”
However, not everyone is happy about the agreement. Professor Frank Zumbo from the University of NSW said that the removal of restrictive leases is a long overdue recognition and is only the first step in dealing with the market dominance of Coles and Woolworths.
“Dealing with just restrictive leases is only part of the picture. Much more is needed to promote a competitive grocery sector and to push down grocery prices,” he said.
He said the announcement “falls short” of what’s needed to deal with the market dominance of Coles and Woolworths and to inject real competition in the grocery sector.
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