Advice on the operation of the Test
in Schedule 4 of the
Groceries Market Investigation
(Controlled Land) Order 2010
Office of Fair Trading
April 2011
A cautionary note
● What follows is advice and practical examples on how
the Test in Schedule 4 of the Groceries Market
Investigation (Controlled Land) Order 2010 works.
● This advice is not a substitute for the Order.
● Contact OFT for any clarification – see list of contacts
at the end of this presentation
Definitions used in this advice
● LGS = Larger Grocery Store (>1,000m2)
● Burdened Site = the site which is the subject of a
Restrictive Covenant or an Exclusivity Arrangement
as defined in the Order
● MGS = Mid-sized Grocery Store (280 to 1,000m2)
● Associated Grocery Store = An LGS or MGS within the
10 minute drive time isochrone around the burdened
site and owned/ controlled by the large grocery
retailer benefitting from the burden
● Fascia = the trading name under which a Grocery
Retailer operates a Grocery Store
● For definitions of other terms see the Order
Identify the exact location of the burdened site
It has been assumed
in all the examples
that follow that the
Burdened Site is not
an LGS store or an
MGS but just a vacant
piece of land. Bear in
mind though that it
will count as a
competing Fascia if it
is an LGS or MGS
Burdened
Site
Draw a 10 minute drive time isochrone round the
Burdened Site
Burdened
Site
Schedule 4, para 1(i)
10 minute
drive time
isochrone
Identify any LGS or MGS owned or controlled by the Large Grocery
Retailer (or a company under common control or ownership) which
benefits from the Restrictive Covenant or Exclusivity Arrangement
Larger
Grocery
Store
benefiting
from
Restrictive
Covenant
or
Exclusivity
Arrangement
Schedule 4, para 1(ii)
LGS
MGS
Mid-sized
Grocery Store
benefiting from
Restrictive
Covenant or
Exclusivity
Arrangement
Construct 10 minute drive time isochrones round each
Associated Grocery Store
Isochrone
round MGS
LGS
MGS
Isochrone
round LGS
Schedule 4, para 1(iv)
If the Associated Grocery Store is a LGS, count the
number of Fascias under which LGSs are operated
within the Relevant Isochrone
LGS
LGS
LGS
LGS
Schedule 4, para 1(vi)
EXAMPLE 1:
In this example
there are 3 other
LGS fascias, i.e.
4 in total so the
Test is passed in
this isochrone
If the Associated Grocery Store is an LGS, count the
number of Fascias under which LGSs are operated
within the Relevant Isochrone
EXAMPLE 2:
LGS
LGS
Schedule 4, para 1(vi)
In this example there is only 1
other LGS Fascia in this
isochrone so 2 in total.
Therefore, we must determine
the groceries sales area of all
LGSs only within the isochrone
and work out whether the retailer
benefiting from the Restrictive
Covenant or Exclusivity
Arrangement fails the Test by
virtue of having a 60% or greater
share of the groceries sales area
within the isochrone
If the Associated Grocery Store is a MGS, count the
number of Fascias under which LGSs and MGSs are
operated within the Relevant Isochrone
EXAMPLE 3:
In this example there are only
2 other fascias (3 in all), so
we must determine the
groceries sales area of all
LGSs & MGSs together within
the isochrone and work out
whether the retailer benefiting
from the Restrictive Covenant
or Exclusivity Arrangement
fails the Test through having a
60% or greater share of the
groceries sales area within
the isochrone
Schedule 4, para 1(vii)
LGS
MGS
LGS
MGS
MGS
Note the following additional points for
the purposes of the Test
•
•
LGSs or MGSs (or a mixture of LGSs and MGSs)
within the relevant isochrone and under common
ownership or control will be considered to be
operating under a single Fascia
Any grocery store which has a Net Sales Area of
less than 280 square metres is not relevant and
therefore not counted
(Schedule 4, paras (viii) to (xi) refer)
OFT contacts for further information
● Bob MacDowall bob.macdowall@oft.gsi.gov.uk
020 7211 8574
● Sharon Dias
sharon.dias@oft.gsi.gov.uk
020 7211 8235
● Natalie Lam
natalie.lam@oft.gsi.gov.uk
020 7211 8129
Markets Policy and Remedies,
Office of Fair Trading, Fleetbank House,
2 - 6 Salisbury Square, London, EC4Y 8JX