Sydney: New Zealand has outlined plans to implement laws in November to simplify and accelerate the approval process for new supermarkets.
Finance Minister Nicola Willis stated that the centre-right government’s proposed rules will create an express lane for approvals, allowing companies to open or expand supermarkets more efficiently and increase competition in the grocery sector.
The move comes as the country’s supermarket industry remains dominated by Foodstuffs NZ and Australia’s Woolworths (WOW.AX). Willis said tough regulations and a slow approval process have prevented new competitors from entering the market, which has limited options and kept prices high for consumers.
While some respondents to a government consultation have called for breaking up the duopoly, Willis said restructuring would require a careful cost-benefit analysis due to potential risks and costs. Instead, the government intends to streamline entry by appointing a single authority to oversee approvals and clarifying foreign investment pathways.
Companies could face prosecution if they misuse market power to block competitors, Willis added. U.S. retailer Costco (COST.O), which opened its first New Zealand store in Auckland in 2022, told the government that the planned reforms would support its future expansion in the country. Five domestic companies have also expressed interest in entering the grocery sector, highlighting the potential for increased competition under the new rules.
These initiatives are expected to enhance market efficiency, reduce barriers for new players, and improve shopping options for New Zealand consumers. The government aims to ensure that approvals are quicker and simpler while safeguarding fair competition in the sector.
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