The Government's response to the Commerce Commission's report on the grocery sector market study is welcomed by the New Zealand Food & Grocery Council. They are particularly pleased with the announcement of a mandatory Code of Conduct, which has been the Council's 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.” Said Katherine Rich, Chief Executive of The New Zealand Food & Grocery Council.
“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.
"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.
"Minister Clark’s work deserves high 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 today there is more to do.
Rich praised a few areas of Minister Clark's work in particular: Strengthening of Section 36 of the Commerce Act regarding the use of market power, changing the Fair Trading Act to prohibit unconscionable conduct and unfair trade practices for small businesses, and the introduction of a mandatory Code of Conduct that will make supplier/retail relationships more transparent.