The Office for Competition started a phase II investigation on the proposed acquisition by Lidl Immobiliare Malta Limited of property at Żabbar belonging to Said Investments Limited and lease belonging to Scotts Limited to operate ‘Lidl’ supermarket.

 The Office for Competition within the MCCAA has opened an in-depth investigation to assess whether the proposed acquisition of Lidl Immobiliare Malta Limited (Purchaser) of property at Żabbar belonging to Said Investments Limited (Vendor) and lease belonging to Scotts Limited (Tenant) is in line with the Control of Concentrations Regulations (Subsidiary Legislation 379.08).

Should the parties’ request be acceded by the Office for Competition, Lidl Immobiliare Malta Limited will be acquiring the Scotts Supermarket in Żabbar grocery retail outlet. The acquirer intends to lease out this property to Lidl Malta Limited to operate grocery retail activities.

The Office for Competition has serious doubts regarding the compatibility of the proposed concentration with the Control of Concentrations Regulations and believes that it may limit competition in the grocery retail market. The Office believes that the proposed concentration may create a situation where it may be expected to result in substantial lessening of competition within a market or markets in Malta. This is especially when taking into account the close proximity of other LIDL stores from the proposed LIDL Żabbar. In line with a previous case decision, the Office holds the preliminary belief that a substantial lessening of competition could potentially occur in the local geographic area. Indeed, this area might exhibit a higher concentration compared to other local geographic areas.

However, the Office opines that prima facie evidence does not support conclusive findings to be able to draw conclusions at this stage and there is a need for a thorough investigation to substantiate concerns arising from the proposed concentration. Accordingly, the Office for Competition is initiating proceedings for an in-depth investigation in accordance with regulation 6(1)(iii) of the Control of Concentrations Regulations.  

Upon the closing of the phase II investigation, the Office for Competition may:

• Adopt a non-opposition decision, if it considers that the concentration, as notified, or following modifications by the notifying parties through remedies, is not likely to create significant impediments to effective competition in the relevant markets; or
• Adopt a prohibition decision, if it considers that the concentration is likely to create significant impediments to effective competition in the relevant markets.