With MP David Shearer’s return in his role of consumer affairs spokesman, the Labour Party is likely to bring the issue of supermarket duopoly back into the agenda.
Last Tuesday, Shearer emphasised that he will investigate the lack of competition within the retail sector.
“I’ll be looking at areas I believe there is insufficient competition and therefore consumers are being squeezed without sufficient protection,” he said.
The substantial duopoly enjoyed by Foodstuffs and Progressive Enterprises has been a recurring topic for the Labour Party. During its leadership contest in 2013, later won by Hon David Cunliffe, his contestant and former cabinet minister Shane Jones promised to introduce regulations on food prices and defined supermarkets as ‘the brown shirts of the food industry.’ A few months later, Jones claimed in Parliament that Countdown was using ‘mafioso’ tactics against Kiwi suppliers, such as blackmail and extortion, and soon afterwards the Commerce Commission started ‘seeking a wide range of information from a variety of sources’.
After a thorough investigation, in November 2014 the Commission cleared Countdown of any unlawful anti-competitive or intimidating behaviour. Far from surrender, the Labour Party announced it had drafted legislation to create a mandatory code of conduct for supermarkets, overseen by an independent adjudicator. The bill, which was aimed to ensure New Zealand suppliers were not affected by anti-competitive behaviour, similarly to what the ACCC currently does in Australia, might now make a comeback.
