The Commission started 2017 with a number of high profile cases. The joint operators of Bike Barn in New Zealand were fined $800,000 for misleading consumers. Bike Barn ran various half price, was/now and clearance promotions, which made misleading representations that bicycles were on offer at a discount from their usual price.
Reckitt Benckiser (New Zealand) Limited was fined $1.08 million for 10 charges relating to its Nurofen specific pain range products. The product packaging stated that the products “targeted” a particular type of pain, when this was not the case. Each product contained exactly the same active ingredient (342mg ibuprofen lysine) and worked identically to the other products. We also filed 45 charges against Bunnings (NZ) Limited alleging it misled consumers by advertising its goods as the lowest prices in the market. One of our areas of focus is pricing claims and we continue to be active in addressing misleading behaviour in this area.
Last month we declined to grant clearance for the proposed merger of Sky Network Television and Vodafone New Zealand. In October last year we outlined our concerns with the proposed merger in a Letter of Unresolved Issues. Subsequent submissions did not resolve our concerns. The Commission was not able to exclude the real chance that the merger would substantially lessen competition.
On the industry regulation front we released our draft decisions on the default price-quality paths (DPP) for gas pipeline services last month. These set the revenue and minimum quality standards that Vector, Powerco, GasNet and First Gas must comply with. Our draft decision would reduce maximum revenues and in turn reduce household gas bills by an estimated 8%. In part these reductions reflect the decisions we made at the end of last year regarding the appropriate return these businesses should receive over the regulatory period. You can read more about the gas DPPs in this edition of Bulletin.
Our Competition Matters conference is back again this year with a great line up of local and international speakers. This two-day event offers sessions in the competition, regulation and consumer protection areas, including breakout sessions where delegates can choose the session most suited to them. The conference provides a forum for discussion and debate on important topics and issues that the Commission, businesses and consumers face. The conference is being held at Te Papa on July 20 and 21 – please see our conference website for more information. You can read about one of our keynote speakers, Professor Spencer Weber Waller in this edition of Bulletin.
Finally, we are busy working on implementing our new strategy for the next 5 years released late last year. Ultimately our goal is to make New Zealanders better off. We aim to do this by playing our part in ensuring markets work well and consumers and businesses are confident participants in those markets. In the middle of the year, for the first time, we will publish our priorities for the upcoming financial year (2017/18). This not only provides transparency of where we will focus our resources, it provides a clear framework within which our efforts and successes can be measured.