Countdown and Foodstuffs could face fines of up to $10 million or three times any commercial gain they received if they breached the proposed new supermarket Code of Conduct – whichever was higher – according to a newly released Cabinet paper.

It shows Ministers decided that if the commercial gain supermarkets made from rule breaches could not be calculated, fines could be potentially higher still, running to up to 10% of their revenues during the accounting period of any breach. An individual could be liable for a fine not exceeding $500,000.

The Cabinet paper says though the new Grocery Commissioner, who would be based at the Commerce Commission, could “issue warnings, accepting undertakings and issue stop or direction orders” they would need to apply to the courts to seek fines or compensation orders.

That means enforcement would work in a similar way to the Commerce Commission’s existing role in policing the Commerce Act.

The new Commissioner would be able to act on their own authority “or with two other members of the commission to sit with the grocery commissioner for specified matters”, a Cabinet minute said.

Cabinet Paper

Cabinet Minute