Lengthy queues formed outside New Look shops across the country on Sunday after the clothes chain announced the sudden closure of all 26 stores in the Republic.

And the winding-up of the shops sparked a swift response from the Competition and Consumer Protection Commission (CCPC) when some customers complained New Look refused to accept gift vouchers as payment during the closing-down sale.

The consumer watchdog has been negotiating with the liquidators to ensure that those with vouchers are not left out of pocket.

A spokesman for the CCPC said: “The Consumer Protection (Gift Vouchers) Act 2019 covers the use of gift vouchers in Ireland.

“This legislation contains no exemption for sales of any kind, including closing-down sales.

“Officers from the CCPC contacted the liquidators in this case late last week regarding a number of consumer protection concerns.

“In our correspondence, we sought clarification on arrangements for the use of gift vouchers by consumers.

“Engagement with the liquidators is ongoing.”

The British-owned outlet, which employs 347 staff nationwide, announced last week it was closing down in the Republic after running up debts of almost €18m following years of “sustained losses and challenging market conditions”.

Staff were notified after the High Court approved the appointment of provisional liquidators last Thursday.

New Look said further engagement is planned over the coming days.

Consumers’ Association of Ireland chief Michael Kilcoyne said: “It will make the workers in other retailers worried about what implications this might have for them.

“Clearly we are a country that has become expensive and that has an impact on employees and on companies alike.

“I think it’s sad what has happened and I think this whole area needs to be examined.”

The company, which opened its first store in the Republic in 2003, held its final liquidation sale on Sunday.

Both the retail and the hospitality sectors are under “undue pressures” after recent increases in the minimum wage, said Jean McCabe, of the industry group Retail Excellence Ireland.

She remarked: “The Government’s own Cost of Doing report highlighted the sectors under undue pressure due to those wage increases.

“However, what I think is important to note is, retailers don’t want to disappoint people and their teams and we very much believe in everyone being able to enjoy a nice standard of living.

“The argument here is, if Government policy is to move towards a living wage, you can’t expect industry to absorb those costs alone when we also have one of the highest VAT rates, have one of the highest energy costs, we’ve got a huge regulatory burden here also in Ireland.”

Ms McCabe called on the Government to “work with us”, adding: “They control VAT, they control PRSI, and if Government was to review those two measures... hopefully we could slow down any further closures.”