Lee Melissa: Commerce (Supermarket Adjudicator and Code of Conduct) Amendment Bill — First ReadingText is incorporated into the Bound VolumeLee Melissa: Commerce (Supermarket Adjudicator and Code of Conduct) Amendment Bill — First Reading[Sitting date: 02 December 2015. Volume:710;Page:8532. Text is incorporated into the Bound Volume.]MELISSA LEE (National): Thank you for the opportunity to take a call on the Commerce (Supermarket Adjudicator and Code of Conduct) Amendment Bill. I congratulate the member Mojo Mathers on having her member’s bill drawn from the ballot. Members’ bills are pretty difficult as some of us know. Some of us have actually had bills in the ballot for many many years and still have not had the opportunity to have a first reading.Kanwaljit Singh Bakshi: I got one.MELISSA LEE: Yes Mr Bakshi you were very lucky. You got it first up but I am still waiting for my turn to actually have my bill read.This bill is to amend the Commerce Act 1986 to require that a supermarket adjudicator is in fact established to resolve disputes between supermarkets and suppliers. I guess the position of this adjudicator would have the power to enforce a code of conduct on supermarkets and force them to pay a levy towards mediation services with suppliers where disputes actually occur. The only thing that I can actually see that will do is increase the prices of products that we buy from supermarkets. I cannot imagine the grocery shops the supermarkets saying: “OK we will actually pay for the levy. We are forced to do so and we are not going to pass on the cost to the consumers.” That is all I see.I will take the opportunity now to say that I see no reason for this legislation to continue. I do not see it as necessary. The Commerce Commission already undertakes the functions of a regulatory body tasked with addressing issues of anti-competitive or dominant market powers in New Zealand. In creating a second agency which Miss Mathers is actually proposing I just see a doubling of authority. I see that it is completely unnecessary.This bill is particularly aimed at two leading supermarket-owning companies Progressive Enterprises Ltd and Foodstuffs (NZ) which provide groceries and goods to hundreds of thousands of New Zealanders all over the country. The Commerce Commission has already reviewed and examined these companies from time to time where concerns have been raised. Most notably a review was undertaken due to a recent complaint that one of the companies had breached the Fair Trading Act and the Commerce Act which Miss Mathers alluded to earlier. As a part of its investigation the Commerce Commission has not said it needs additional tools to undertake its commendable work protecting the markets. The Government believes the Commerce Commission has ample resources to continue its task and does not need what Miss Mathers is actually proposing in her bill.It has always been an expectation of the Government that all companies deal in a fair and transparent manner. That is what we all want as consumers. This is the case whether there are dominant business partners in the market or smaller low-end suppliers. Where companies do not the Commerce Commission has the necessary tools and resources to investigate and if necessary it can actually take action. It can be seen that the supermarket industry is regulating itself without the need for a mandatory code of conduct. Supermarkets like any other company know it is bad business to undertake unsound commercial practices. They know that just as they need to keep consumers happy they also need to look after their supply lines. They maintain their own standards without the need for further regulation.Having had a business where we used to supply grocery shops with imported goods from overseas it is often very difficult to break into that market. Sometimes it seems like climbing Mount Everest because you are—not you Mr Speaker but the business is—in competition with other businesses to break into that supermarket chain because you want to show that you have got a good product. But the supermarkets have many many choices. What they do is that often they are in tune with the trends of the market. They know what is popular with consumers and so they will buy what is popular and what will sell at their supermarkets. I think they will get the best products for the best prices and often suppliers want to do that too because by being on the supermarket shelves they are reaching more people than if they do it themselves from their little I do not know shed manufacturing—Todd Barclay: What about Four Square?MELISSA LEE: Four Square? Yes there is another option. There are many people who actually have choices.Consumers too have choices. They do not have to go to supermarkets. There are many places in New Zealand where people buy their fresh fruit from the markets. The Grey Lynn market is actually a good example. Farmers markets are actually good examples. Many of us use that option and do not always go to the supermarket. On Monday I wanted to cook fish and instead of going to the supermarket I went to the local fish shop where I live. I think that was actually really really good. It is a consumer’s choice to do so. I think the supermarket industry as I said regulates itself to provide the best possible produce for the consumers and I do not believe that this adjudicator is necessary.Just in addition to the substantial defects in the policy rationale of Miss Mathers the bill actually contains some fundamental technical errors I think. What she is actually saying is that the designated supermarket chain and the supermarket could exclude Foodstuffs (NZ)’s 700 owner-operator supermarkets. Under this bill the adjudicator does not have a clear means of efficiently dealing with complaints. So just to make it very short I do not think it is necessary. I will not be supporting this bill.