Competition — stifle it at your peril

Some four years ago, the Competition Act 1988 (Land Agreements Exclusion Revocation Order) 2010 came into effect, repealing the special exclusion relating to the application of the Chapter 1 prohibition of the Competition Act 1988 to land agreements.

Agreed, it’s a bit of a mouthful but the consequences of the order for land agreements are significant. Since April 2011, any land agreement that may affect trade within the UK and has as its object or effect the prevention, restriction or distortion of competition within the UK will be void and unenforceable.

In the past, supermarket operators commonly used land agreements to restrict how land could be used or how a right over land could be exercised. Typically, such operators employed restrictive covenants on the transfer of freehold land as a means of limiting the availability of prime land for competitors to develop completing stores. It’s a nice trick but getting away with it is clearly not going to be quite so easy now…

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