French hypermarket chain LPA this week announced plans to re-open Clitheroe's former Woolworths store selling imported wine, beer, spirits, cigarettes, perfumes and other luxury goods at a fraction of the normal UK price.

It claims it can avoid paying UK taxes because, according to an ancient charter discovered during the renovation of Clitheroe Castle museum, the centre of the historic market town is still governed by French law!

Clitheroe Castle was built around 1186 by Robert de Lacy, whose ancestors came to Britain with William the Conqueror. As a reward for their loyalty, King William granted the de Lacy family vast estates in the Ribble Valley, and Robert de Lacy built Clitheroe Castle to protect the administrative centre of those estates.

A key part of that protection was that the castle keep – the bastion of de Lacy's power – and an area of one "lieue" (an old French measurement of about 10,000 feet) all around the keep was governed by French law.

It allowed de Lacy and his followers to live under French rules, free from legal persecution by their English foes.

This ancient charter of "governance Francais de Clitherow" was rediscovered among carefully preserved documents during the recent renovation of Clitheroe Castle Museum, and, so far, there is no proof that it has ever been repealed under English law.

In other words, the centre of Clitheroe is effectively a tiny French dominion, exempt from British rule.

Now French hypermarket giant LPA (Le Premier Avril) plans to take full advantage of the legal loophole by opening its first UK store in the heart of Clitheroe, operating under French law and avoiding all UK taxes. It will sell the same range of goods that attract hundreds of thousands of Brits across the Channel on "booze cruises" each year, and at the same discount duty-free prices.

The only catch is that the thousands of bargain hunters expected to descend on Clitheroe will have to bring plenty of Euros with them, as that will be only legal currency in the French heart of Clitheroe.

It is not yet clear how this will affect other town centre traders, who might have a legal case to reclaim 800 years of illegally collected UK taxes.