Complaints against the major multiples have been flooding in after the Competition Commission announced it would investigate behaviour in the supply chain.
The commission has received submissions from a range of parties, with the majority so far detailing the unfair deal given to suppliers.
One producer reportedly claimed when cauliflower supply tightened at the end of last month, Tesco paid £1 per head for German imports compared with only 50p for home-grown supplies.
“We have not made a significant profit now for six years, and indeed the 2006 year end is likely to show a significant loss as all our different produce areas have suffered from low prices,” he said.
Tesco has also come under fire as the biggest culprit in the issue of land banked by the retailers.
Lawyers for the UK’s number one supermarket admit it has signed questionable contracts with local councils that exclude its competitors from buying land in the area.
The revelation came from London law firm Berwin Leighton Paisner during an inquiry by North Norfolk district council to determine why councillors were prevented from selling council land to Budgens.
Similar cases have since emerged although Tesco denies involvement in any foulplay.
A spokesman for the chain said: “The agreement with North Norfolk district council was entered into freely by both parties and did not in any way prevent competition in the town.
“It simply required the landowner, in this case the local authority, to support the significant investment being made by Tesco above other schemes involving other land owned by them. It in no way restricted the authority’ role in the planning process or prevented them from supporting proposals from other supermarkets on privately-owned land.”
A report on the Norfolk land deal sent to council members this week revealed how over an eight-month period Tesco’s advisors had raised their offer repeatedly and refused to co-operate with the council inquiry, or waive a confidentiality agreement.
The consumer group Which? is backing the OFT’s claim that the land bank issue does “raise competition concerns” and calling for a strong reaction from the CC if it finds competition has been breached.
