Supermarket chain Tesco Ireland has agreed not to engage in misleading price comparisons with its rivals Aldi.

Tesco has also consented to pay €150,000 damages as well as the retailer's legal costs as part of a High Court settlement between the 2 stores.

Aldi had sued Tesco claiming it was engaged in copyright infringement and a misleading in-store price advertising campaign.

The retailer alleged its rivals failed to compare like-with-like when comparing the prices of its products with those stocked in Tesco.

Dispute over comparisons

It claimed the use of Aldi trademarks in banners displayed in Tesco stores this year was "the final straw".

Under the settlement Tesco can not carry out price comparisons on products of a different quality, size or of a different substance, such as marmalade and tuna chunks.

They also cannot compare similar products with different ingredients such as dry dog food and moist dog food.

In a statement Aldi said it is very pleased with the undertakings made by Tesco Ireland and said that 'regrettably' it had no alternative but to issue proceedings.

It adds that it is fully in favour of  comparative advertising when it is ''accurate, fair and cannot mislead the consumer''.

The supermarket chain said it repeatedly brought the matter to the attention of Tesco but no action appeared to be taken.

Tesco has yet to issue a statement on the settlement.