“The first Lidl [in Madeira] was going to be in Machico, in 2002.” This statement, published on Reddit in connection with recent clean-up and construction work on land in Funchal owned by the German-origin distribution chain, has reignited the long-standing debate about the arrival of that supermarket brand in the region.
Did Lidl really intend to make its debut in Madeira with a store in Machico?
The aforementioned phrase appeared in a comment on the social network Reddit, in connection with a news story from JM about the cleaning of a plot of land on Rua Dr. Pita, which allegedly belonged to Lidl. To understand if it is true, it is necessary to go back to 2001 and follow a story that has lasted for more than twenty years, with two distinct phases.
The complete chronology
July 2001
The first contacts emerge, with two stores on the horizon. DIÁRIO reports that the Lidl company intended to enter the Madeiran market in 2001. Initially, the idea was to open a store in Funchal and consider a second in another municipality. A market study was underway.
August–November 2001
The German company has made a formal request to the Regional Government for the installation of seven hypermarkets in Madeira, totaling 8,040 square meters and representing an investment of 100 million euros. Specifically, the stores would be located in the following places:
1. Rua do Ribeirinho (former Engenho), Machico – 1,000 m2
2. Sítio da Torre, Câmara de Lobos – 1,015 m2
3. Vereda da Vargem, São Martinho, Funchal – 1,200 m2
4. Poço Barral, São Martinho, Funchal – 1,200 m2
5. Sítio da Quinta, Caniço, Santa Cruz – 1,180 m2
6. Rua Nova do Pico de São João, São Pedro, Funchal – 1,200 m2
7. Rua 5 de Outubro, São Pedro, Funchal – 1,245 m2
At this stage, the Vice-Presidency of the Regional Government was gathering opinions, and the preliminary project for Machico, for the site of the old sugar mill, was submitted to the local City Council.
November 2001
Estêvão Neves (Modelo/Continente) and Rui Sá (Sá group) made public statements against Lidl’s entry into the region. They argued that the German chain “will kill the regional industry” because it will not buy products from Madeira, and companies like ILMA, Companhia Insular de Moinhos, and Empresa de Cervejas da Madeira would be affected. They asked the Government not to authorize the installation.
January 2002
A preliminary purchase and sale agreement between Lidl and Auto-Zarco (Camacho family) concerning a building on Rua Nova do Pico de S. João, Funchal, for approximately 310 million escudos (around 1.5 million euros) has become public. The clause in which the seller promised “all necessary cooperation” to obtain the license has been denounced by competitors as suspicious. President Alberto João Jardim claims to be “completely unaware” of the matter.
October 3, 2002
The Government Council approves Resolution No. 1216/2002, suspending the granting of new prior authorizations for all commercial units of significant size throughout the Region. The basis: a technical document entitled “Summary Impact Study of Legislation on Commercial Units of Significant Size in the RAM” concludes that “market quotas are filled and exhausted”. The seven Lidl supermarkets are left “on hold”. Estêvão Neves and the Association of Commerce and Services (ACS) applaud this halt.
December 2002
Lidl is appealing this decision to the Central Administrative Court. The chain challenges the Regional Government’s resolution, alleging restrictions on business rights, usurpation of powers, and illegality of the Regional Legislative Decree. It argues that there was market space available, at least in the municipalities of Câmara de Lobos, Funchal, and Santa Cruz.
January 2006
The Legislative Assembly of the Autonomous Region of Madeira approves new legislation (Regional Legislative Decree No. 1/2006/M), which revokes the previous regime and establishes new limits: sales areas equal to or greater than 500 m² are subject to authorization; the installation of food establishments with a sales area greater than 2,500 m² is prohibited.
November 8, 2007
The Central Administrative Court of the South rejects Lidl’s appeal due to the “manifest illegality of its filing,” considering that the GR resolution “does not, in itself, constitute any administrative act that infringes on the appellant’s rights.” This first judicial chapter is now closed. The German chain will not attempt to re-enter the Madeira market for almost fourteen years.
September 2021
Almost twenty years after the first attempt, DIÁRIO reports that Lidl has resumed contact with regional mayors and is exploring potential land. The most advanced location was the former Leroy Merlin and AKI premises on Caminho do Poço Barral, Funchal. The Regional Secretary for Economy, Rui Barreto, confirmed the contacts and applauded the initiative.
September–October 2022
The Funchal Municipal Council (CMF) approved the preliminary information requests for the installation of Lidl stores in Poço Barral (former AKI), on Avenida Mário Soares (Amparo, S. Martinho) and on Rua Dr. Pita (just above the Barreiros stadium). However, it rejected the project for Largo Severiano Ferraz (Cruz Vermelha), where Lidl had purchased the Madeira Wine block in August for approximately 5 million euros. The CMF justified this latter decision with the violation of the Municipal Master Plan (PDM), excessive building volume, and mobility constraints in the historic center of S. Pedro. Lidl appealed this rejection, and it was again rejected.
January 2024
Lidl issued a statement claiming to be “in the process of reorganizing its expansion plan for Madeira, following the current national and international economic and financial context, without any political motivation.” The then-mayor, Pedro Calado, relied on this statement to refute the JPP’s accusations that the CMF (Madeira Municipal Council) was hindering the investment. The JPP maintains its interpretation of the facts.
Given this timeline, what can be concluded about the comment published on the Reddit platform is that it is true that Machico was part of Lidl’s original plan for entering Madeira. The company submitted a request for authorization for Rua do Ribeirinho, Machico (1,000 m²) in August 2001. The preliminary project was even submitted to the local council. In that sense, Machico could have been one of the first stores to open. What is inaccurate or misleading is the suggestion that Machico would have been the only or main location. In reality, there were six other locations simultaneously, mostly in Funchal. None even reached the approval stage. All were blocked by the GR resolution in October 2002, before any license was issued.
Furthermore, 2002 was the year the process was suspended, not the year planned for the opening. Initial plans pointed to store openings in 2001, but formal requests date from August 2002. In October 2002, everything was blocked. It was the end of this phase, not the beginning.
It can be concluded, therefore, that the statement is true in substance, since Machico was indeed one of the planned locations. However, it is inaccurate because it omits the fact that there were six other locations being considered simultaneously, none of which came close to opening, and that ‘2002’ was the year of the project’s closure, not the planned inauguration.