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Mandatory code of conduct needed for supermarkets

Labour has drafted legislation to establish a mandatory code of conduct for supermarkets to ensure New Zealand suppliers are not affected by anti-competitive behaviour.

“Even though the Commerce Commission found no technical breaches of the law through some of Countdown’s business practices when dealing with suppliers, 90 complaints would indicate there are serious issues which need to be dealt with,” says Labour’s Commerce spokesperson Clayton Cosgrove.

“The Commission was only able to look at the letter of the law. In Labour’s view the law is not strong enough. In Australia the ACCC is currently prosecuting Coles for anti-competitive behaviour and has a code of practice.

“The UK has an independent adjudicator with a mandatory code of practice. In that country there are ten dominant supermarket players who effectively control 85 per cent of the market and that has been judged to be too much concentrated market power. In New Zealand there are two dominant players, with 95 per cent market share.

"It is time the law was changed. Labour has worked on this issue for some time and has the solutions.

“Labour has a bill ready to go that would create a mandatory code of conduct for supermarkets, overseen by an independent adjudicator with real teeth. We will release it next week and offer it John Key’s Government as a solution to these issues.

“Last year Labour also lodged an amendment to make changes to s36 of the Commerce Act to give the Commerce Commission more power to act on damaging anti-competitive behaviour.

“So far National has refused to support our amendment. They should reconsider,” says Clayton Cosgrove.