Independent grocers have welcomed a decision by the Director of Consumer Affairs, Ms Carmel Foley, to issue court summons against Tesco and Dunnes Stores for alleged breach of the ban on under-cost selling.

Praising the director's "swift action" against the two chains over heavy discounting of baby food, RGDATA, which represents smaller retailers, said selective price cuts by multiples is placing suppliers, in particular, under intolerable strain.

With Dunnes and Tesco controlling more than 50 per cent of the market, it is essential they been seen to uphold the Groceries Order, which prohibits below-cost selling, said RGDATA director general Ms Ailish Forde.

She said: "It is vital that organisations with such incredible market power are not allowed to abuse this power at the expense of consumers, suppliers and retailers."

Ms Foley is also investigating whether a frozen foods promotion by Dunnes contravenes the order. Her findings are expected within weeks.

The Groceries Order has helped protect the competitiveness of the Irish grocery industry, in which price rises have remained consistently below the rate of inflation, said Ms Forde.

The legislation was introduced in 1987 by the Minister for Industry and Commerce after the collapse of the H Williams supermarket group following a price war with Dunnes Stores.