Auckland (The NZ Today)
Two Pak’nSave supermarkets have been fined a combined $580,500 after admitting repeated pricing breaches that included charging customers differently from advertised shelf prices and promoting discounts that were not genuine specials.
Pak’nSave Silverdale in Auckland was fined $234,000, while Pak’nSave Mill Street in Hamilton received a $346,500 penalty.
The Commerce Commission had laid criminal charges against the independently operated stores after identifying multiple breaches of the Fair Trading Act.
Mill Street pleaded guilty to eight charges and Silverdale to 10.
The offending included cases where shelf or advertised prices did not match what customers were charged at the checkout, as well as products being presented as discounted despite there being little or no genuine reduction.
In one example presented during the proceedings, a product labelled “extra low” had reportedly been sold at that same price for more than 90 percent of the year.
Commerce Commission deputy chair Anne Callinan said consumers should be able to trust that supermarket prices displayed on shelves and in promotions are accurate.
She said major grocery retailers had previously been warned about their pricing obligations and the Commission would prosecute other supermarkets where it believed similar wrongdoing had occurred.
Consumer NZ, however, said the penalties were unlikely to be large enough to significantly deter major supermarket operators.
Chief executive Jon Duffy described the fines as a “drop in the bucket” relative to the size of the businesses and called for stronger penalties under the Fair Trading Act.
The Government has been considering changes that could allow significantly higher penalties, including fines of up to $5 million for individual breaches under a proposed civil enforcement regime.
The Commerce Commission said higher potential penalties could create a stronger incentive for large companies to invest in systems that prevent misleading pricing.
During sentencing arguments, prosecutors said being a high-volume supermarket with frequent price changes was not an excuse for repeatedly getting prices wrong.
Both stores had introduced or improved electronic pricing systems, but the court heard that errors continued in some cases because of weaknesses in checking and complaint-recording processes.
Lawyers for the supermarkets said the businesses had cooperated with the investigation, pleaded guilty early and made further improvements after proceedings began.
The latest penalties follow an earlier case involving Pak’nSave Māngere, which was fined $78,000 in 2020 for discrepancies between advertised promotional prices and checkout charges.
The Commerce Commission also has other supermarket-related cases underway, including separate proceedings involving Woolworths New Zealand and Foodstuffs businesses.
Source: New Zealand Herald reporting
