New Zealand will introduce laws to fast-track the approval process for new supermarkets in a bid to boost competition and bring in lower prices.
Finance Minister Nicola Willis said her centre-right government’s proposed rules, to be introduced in November, would speed up and simplify the process to open or expand supermarkets in the country.
NZ Finance Minister Nicola Willis.Credit: Getty
“We’re creating an express lane for new supermarkets to boost competition and deliver better deals for Kiwi shoppers,” Willis said in a statement.
Tough regulations and a slow approval process for new applications are blocking new competitors from gaining a foothold in the country’s grocery sector, dominated by Foodstuffs NZ and Australia’s Woolworths, Willis said.
Some respondents to a government-initiated feedback process on the sector have argued for the break-up of Foodstuffs and Woolworths, Willis said.
But she said any decision “to restructure the supermarkets is not a decision that would be taken lightly” though a cost-benefit analysis will check the specific options for restructuring the duopoly.
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The government will instead streamline the entry of new supermarkets by appointing a single authority to oversee the entire process and also modify the foreign investment rules to clarify investment pathways.
Companies could be prosecuted if they misuse their market power to exclude or stamp out competitors, Willis said.
A damning report into Australia’s supermarket sector found the country’s major supermarkets are among the most profitable in the world, and they have failed to pass on the full benefit of cost savings during the cost-of-living crisis.
The Australian Competition and Consumer Commission found a lack of competition, and particularly the dominance of Coles and Woolworths, had left Australian shoppers paying more for everyday essentials while the supermarkets enjoyed high profits.
Reuters with Shane Wright, Jessica Yun and Millie Muroi