Tesco has called on the Advertising Standards Authority to force Ocado, the grocery home shopping group, to scrap a campaign claiming that it is price-matching Britain’s biggest retailer on 3,500 branded products.

Tesco is furious that Ocado is claiming to offer “Waitrose products and Tesco prices”. It argues that Ocado is regularly more expensive on at least 500 items. A Tesco spokesman told The Times: “We think it’s underhanded and entirely misleading.”

The move marks the latest twist in an increasingly fractious war of words between the companies. Sir Terry Leahy, the chief executive of Tesco, has described Ocado as a “charity”, given that it has run up losses of £300 million in the eight years since it began trading. Ocado, which sells Waitrose products alongside branded goods, began the price-match promise in February, vowing to bring prices for products such as Pampers and Coca-Cola down to the level charged by Tesco.

Jason Gissing, the marketing and finance director of Ocado, insisted yesterday that Ocado checked its prices against Tesco’s every week. He added: “We are not surprised that Tesco have decided to act with their customary aggression, but we are disappointed they don’t have more important issues to focus on. They have clearly realised that their initial response of price-cutting goods we both sell has not worked.”

Tesco has Britain’s biggest grocery home shopping business. Ocado claims to have a market share of 50 per cent in London.

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