Lidl is currently “assessing its position” after the Office for Competition within the Malta Competition and Consumer Affairs Authority (MCCAA) prohibited the company from acquiring the Scotts Żabbar property.

WhosWho.mt reached out to Lidl following the decision, issued on 18th September, to inquire if the company intends to file an appeal. In response, Lidl pointed out that it was reviewing the situation and said "will not be commenting at this time".

The prohibition follows an in-dept investigation that concluded that the addition of the Żabbar location to the lidl brand would “substantially lessen competition in the area.”

Lidl is a German retailer operating in 31 countries and has been trying to buy the site since 2021. It had also proposed acquiring two outlets in Burmarrad and Sliema at the time, a move it has since completed.

What did the investigation conclude?

The office’s findings indicated that the acquisition would have strengthened Lidl’s position in the grocery retail market in southern Malta. More specifically, the office found that the acquisition would have widened the gap between its competitors and limited market competition. 

Additionally, it remarked that “Lidl did not offer commitments that were sufficient to address the substantial lessening of competition concerns as identified by the office for Competition.”

During the investigation, the office gathered feedback from stakeholders in the grocery retail market. Concerns were raised that the acquisition could reduce competition, harm other businesses, and negatively impact consumers.

The office analyzed grocery stores with a sales area of 200 square meters or more, assessing them on price, range, service, and quality. Of the 87 stores evaluated, 53 met the competitive criteria in at least two areas, classifying them within the relevant market.

It also reviewed Żabbar’s topography, customer travel habits, and catchment areas, determining that a 15-minute drive was a reasonable estimate of shoppers' travel range.

Finally, the office considered the potential for new competitors to enter the market and whether existing players could expand or exit, assessing the speed and sustainability of such changes to market competition.

In a separate decision by another entity, the Planning Authority has greenlit a new, second Lidl supermarket in Qormi, sparking criticism that the island is being inundated with the discount supermarket chain.

Currently, there are 10 Lidl supermarkets across Malta and Gozo, with the upcoming Qormi outlet representing the 11th, meanwhile another Lidl supermarket in Żebbuġ is currently being developed, which would be the 12th on the island.