Supermarket competition
We are working across government to improve competition in the grocery sector.
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Our work programme
Between March and May 2025, the Government ran a Request For Information (RFI) process to hear from investors and prospective grocery market competitors about possible barriers to entry and investing and growing at scale in the market. 24 responses were received from a mix of existing companies, prospective competitors, advocacy groups and other interested parties. These responses were provided in confidence and will not be publicly released due to commercial sensitivity.
The Request for Information has informed development of a work programme on grocery competition. This programme has 3 streams running in parallel:
- Enforcement: strengthening fair trading and competition legislation to deter anti-competitive behaviour and promote the interests of consumers.
- Regulatory: reducing regulatory barriers to make entry and growth of retailers easier and more attractive.
- Structural: investigating the costs, benefits and risks of restructuring the incumbent retailers in order to promote competition.
The programme is led by MBIE, who are working with other agencies to progress regulatory improvements.
Workstream 1 – Enforcement
RFI respondents noted the major incumbents use their market power to prevent potential competition.
This workstream entails:
- Checking if there are any gaps in the Commerce Commission’s powers to act against any anti-competitive behaviour in the retail grocery sector.
- Targeted amendments to the Fair Trading Act 1986, including changes to the penalties regime to address misleading practices.
Workstream 2 – Regulatory
RFI respondents identified a range of regulatory issues, particularly around slow and complex consenting processes.
This workstream entails:
- Clarifying grocery developers’ eligibility for fast-track approvals.
- Establishing a single building consent process for supermarket developments.
- Removing restrictions to use MultiProof for faster building consent of standardised designs.
Fast-tracking resource consent for supermarket developments
The Fast-track Approvals Act 2024 is being amended to make it clear that grocery developments that will improve national or regional competition can access fast-track approval processes. These changes include:
- amending the Fast-Track Approvals Act to clarify that the overall effects of grocery competition are a factor for consideration by fast-track decision makers.
- setting a Government Policy Statement on grocery competition to support decision-making under the fast-track process.
The changes aim to give grocery developers greater certainty that they can apply for fast-track approvals instead of going through the standard resource consent process, which can take an average of 18 months (as noted in the second Annual Grocery Report).
The fast-track changes are expected to be in place by the end of the year.
Read more about fast-track consenting on the Ministry for the Environment website:
Fast-track consenting(external link) — Ministry for the Environment
One building consent process for supermarkets
A single building consent process is being established to support grocery developments across New Zealand.
There are currently 68 different building consent authorities in New Zealand, which RFI respondents say creates uncertainty for large-scale nationwide developments.
The Government aims to enable a single building consent process for new and larger developments.
MBIE is in discussion with potential BCAs to determine a provider that could carry out this role and anticipates having a service in place by the end of the year.
Expanding MultiProof eligibility
Supermarket developers will also be able to more easily apply for MultiProof approvals to enable replicable designs to be easily built across the country.
With MultiProof approval, nationwide developments will benefit from a faster building consent process. Building consent is still required for MultiProof approved designs, but this is limited to addressing site-specific features such as foundations and site services, and must be completed within 10 working days instead of 20.
The MultiProof changes will remove the following eligibility requirements for all developments, including supermarkets:
- Requirement for applicants to build a design at least 10 times over 2 years, provided the designs are still intended to be replicated.
- Requirement for applicants to intend to build themselves.
More information about MultiProof is available at:
MultiProof(external link) — Building Performance
Product labelling review
The Government is reviewing product labelling requirements, including food labelling to streamline regulation and reduce complexities for businesses.
More information about the review is available on the Ministry for Regulation website:
Product labelling regulatory review(external link) — Ministry for Regulation
Workstream 3 – Structural
Some RFI respondents advocated for a restructure of the retail grocery market that would restructure Foodstuffs and/or Woolworths.
This workstream entails:
- A cost-benefit analysis of structural options.
A cost-benefit analysis has been commissioned to investigate the costs, benefits and risks of restructuring the incumbent retailers in order to promote competition. More information on this work is expected later this year.
Contact
For all enquiries please contact: