The Competition Commission this evening gave supermarkets the green light to build more stores, but recommended the appointment of an ombudsman to provide suppliers with greater protection.

The CC will not force the big supermarkets to sell any of their land, shattering the expectations of small grocers and the Association of Convenience Stores.

In a delayed statement, the CC said: “We have provisionally identified only nine landbank sites that may be acting as barriers to entry in areas of high concentration.”

Crucially, it added: “We do not consider it appropriate to put in place a remedy specifically designed to deal with landbank sites.”

However, it has recommended that supermarkets, particularly the big four, change some restrictive development practices that prevent rival retailers from opening stores in towns where a chain has a dominant presence.

A new code of practice will be created, referred to as the Groceries Supply Code of Practice. The coverage of the code will be extended to all UK grocery retailers that are part of corporate groups with annual turnover greater than£1 billion.

An ombudsman will be appointed to resolve any disputes between retailers and their food suppliers. They will have the power to award compensation and will uphold a tougher version of the Supermarkets Code of Practice. Supermarkets will have to employ compliance officers to make sure the code is followed.

An Asda spokesman said: “We welcome the Competition Commission’s recommendation to introduce a new competition test."

British Retail Consortium director-general Stephen Robertson said: “What is this endless inquiry achieving? The Commission accepts healthy competition is delivering for consumers. That is not in dispute. These proposals are peripheral and will not lead to customers being served better.

“This is the third major investigation into the sector since 2000. They are costly and time-consuming. It’s time retailers were allowed to get on with delivering for customers.”