The New Zealand Food & Grocery Council welcomes the Government’s response to the Commerce Commission’s report on its Market Study into the grocery sector, particularly the strong emphasis on a mandatory Code of Conduct – a goal since 2010.
“It’s a major task unravelling the harm caused by New Zealand’s duopoly market structure, but announcements today make the direction clear,” says chief executive Katherine Rich in a statement.
She says consumers, suppliers and other retailers will welcome these plans.
“The Government has recognised change needs to occur if there is to be genuine competition in the grocery market and an improvement in retailer behaviour.
“New Zealand is the only country in the world whose market has distilled down to a duopoly, and the suite of changes announced today will make a difference by nurturing new buds of competition,” Rich says.
“Independent retailers will never be competitive as long as they have to line up at the supermarket with everyone else.
“As we have said regularly, the wholesale market for groceries is broken, and competitive access to a full range of products is important to support healthy competition.”
She says Minister Clark’s work deserves praise.
“We suspect many might not appreciate the full picture of his work to change the grocery industry’s entire commercial framework. And he has made it clear … there is more to do.
“In his Dunedin no-fuss way he has strengthened the Commerce Act to allow market studies, overseen a market study, strengthened Section 36 of the Commerce Act regarding the use of market power, changed the Fair Trading Act to prohibit unconscionable conduct and unfair trade practices for small businesses, and he will introduce a mandatory Code of Conduct to make supplier/retail relationships more transparent.
“The changes he has quietly championed in the Commerce portfolio will make a difference to the competitiveness of New Zealand’s grocery market,” she adds.
