The UK Competition and Markets Authority (CMA) said it has launched an investigation into suspected breaches of competition law by Leicester City FC and Bury-based FTSE 100 retailer JD Sports Fashion Plc over the sale of club-branded merchandise.

“At this stage the CMA believes that it has reasonable grounds to suspect one or more breaches of competition law,” said the CMA.

“The CMA has not reached a view as to whether there is sufficient evidence of an infringement of competition law for it to issue a statement of objections or, ultimately, an infringement decision, to any party under investigation.

“Not all cases result in the CMA issuing a statement of objections or an infringement decision.”

A Leicester City spokesman said: “Leicester City Football Club takes its obligations to comply with competition law very seriously and is fully cooperating with the Competition and Markets Authority in respect of the investigation announced this morning.

“We shall be making no further statements regarding this investigation for the time being.”

A spokesman for JD Sports said: “We are cooperating fully with the CMA’s investigation.

“We have no further comment at this time.”