Saturday, June 15, 2024

Grocery Commissioner to ramp up supermarket competition

A Grocery Commissioner will hold the supermarket sector to account and ramp up competition, Minister of Commerce and Consumer Affairs, Dr David Clark announced today.

Minister Clark said the new industry watchdog will be based in the Commerce Commission, and will help keep pressure on the grocery sector, by providing annual state-of-competition reviews.

“Global factors continue to drive up the cost of living around the world and high grocery prices are making it hard for New Zealanders right now which is why the Government has taken a range of steps to take the pressure off immediately while also tackling the underlying problem in the supermarket sector which is lack of competition,” Mr Clark said.

“The Grocery Commissioner will be a referee of the sector, keeping the supermarket duopoly honest and blowing the whistle where it suspects there is a problem.

“They will maintain a close eye on how Government’s reforms for the sector are implemented and ensure Kiwis are getting a fair deal at the checkout.

“By placing this role in the Commerce Commission it will have access to a wealth of information when it comes to economic and competition regulation, fair trading, consumer protection and the grocery sector itself.”

Minister Clark said legislation to establish the role is expected to be introduced later this year.

“This is the latest in a suite of measures the Government is taking to get better outcomes for New Zealanders at the checkout, and follows the passing of legislation last week that bans major supermarkets from blocking their competitors’ access to land to set up new stores.”

“I’m also releasing for consultation a mandatory code of conduct between major grocery retailers and their suppliers today. The purpose of the code is to ensure suppliers get a fair deal.

“Historically, there has been an imbalance in the bargaining power major grocery retailers have over their suppliers.

“The Grocery Code of Conduct will address this by preventing the major retailers from using their power to push costs and risks onto those suppliers. It will ensure that this relationship is conducted fairly.

“This is especially important for the small, artisan brands and the emerging start-ups that want to get their products on shelves. We want them to feel empowered and we also want consumers to have the added variety when they go to the supermarket,” Minister Clark said. 

He said the draft Code of Conduct consultation paper has been developed with input from an advisory group that includes representatives from the major grocery retailers, and from groups that represent suppliers and consumers.

The Code is available on MBIE’s website and will be open for feedback for five weeks.

The other actions and reforms as part of the Government’s response to the retail grocery market study are also moving at pace. Updates will continue to be provided as this work progresses, the Minister said.

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