Spar accused of blocking butchery chain from malls

Grocery chain Spar has come under fire for failing to comply with the Competition Commission’s recommendations that retailers end exclusivity lease agreements with shopping mall owners.

The commission’s spokesperson, Siyabulela Makunga, confirmed that a complaint has been lodged by OBC Better Butchery for allegedly enforcing exclusivity clauses in leases.

Makunga said Spar failed to comply with the inquiry recommendation to end exclusive agreements, which resulted in the investigation. “The matter is currently being investigated. If found guilty, Spar may be liable to pay an administrative penalty of up to 10% of their total revenue calculated for the period of a contravention,” he said.

Last week, the retailer reported total revenue of more than R138 million for its full year to end of September.

Competitors Shoprite and Pick n Pay have, however, come to agreements with the commission, said Makunga.

The complaint was lodged on 4 November by OBC managing director Tony da Fonseca, who said landlords are being prohibited from renting space in their shopping centres to Spar’s competitors. “While attempting to conclude lease agreements for available space in various shopping centres where Spar is the anchor tenant, the landlords have openly communicated to us that they cannot conclude a lease agreement with us, as Spar is enforcing their exclusivity clause,” said Da Fonseca.

He said OBC has been blocked from trading in shopping centres such as Hubyeni Shopping Centre in Limpopo, KwaMashu Shopping Centre in KwaZulu-Natal, Gugulethu Square in the Western Cape, and Setsing Plaza in the Free State.

The Spar Group said it was not aware of any formal or informal complaint, from any national supermarket chain, or from OBC, about being excluded from a retail centre due to the presence of Spar stores.