Cartelling charges laid against Foodstuffs North Island and Gilmours

The Commerce Commission says it will launch civil proceedings against Foodstuffs North Island (FNI) alleging cartel conduct and breaches of grocery competition law.

The regulator named FNI – which operates PAKnSAVE, New World and Four Square in the North Island – and Gilmours Wholesale Limited in the action, which comes amid heightened scrutiny of competition in the grocery sector.

The commission says a national grocery supplier and a hospitality customer, both of which had “considerable” business with FNI and Gilmours,  had set up a direct trading relationship.

But the competition watchdog will allege in the High Court at Auckland that when FNI and Gilmours found out, they muscled in on the deal by persuading the supplier to go through them.

“The supplier wanted to provide a competitive supply channel, but this was stopped by the agreement with FSNI and Gilmours,” Commerce Commission chair John Small said.

“We do not tolerate this kind of behaviour and will not hesitate to take court action, where appropriate.”