Former T&G chairman 'quietly confident' for Zespri court case -

Former T&G chairman 'quietly confident' for Zespri court case

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Former T&G chairman 'quietly confident' for Zespri court case

Former Turners & Growers chairman Tony Gibbs says he is 'quietly confident' ahead of the company's High Court case against kiwifruit company Zespri.

Turners & Growers' essential goal with the case is to dismantle Zespri's monopoly on the grounds it has allegedly abused market power in a number of forms, which also has the potential to jeopardize New Zealand's free trade agreements.

While the case has many aspects to it and the initial hearing last year ruled in favor of Zespri, there are still important matters for the court to address which will take place over the next four to six weeks.

The case was due to start on May 3 but Turners & Growers' legal team has sought a postponement, with a new date to be announced soon.

Gibbs told New Zealand's government 'desperately' wants to be part of an extended Trans-Pacific Partnership free trade agreement (FTA), but the state monopoly of Zespri is standing in its way.

"The Trans-Pacific Strategic Economic Partnership (TPP) is between the U.S., New Zealand and a lot of countries on the Pacific rim. Now, before America (U.S.) agrees to the free trade agreement there’s  a number of things you shouldn’t have, and one of them is state monopolies," he says.

"New Zealand’s government knows that. We’ve been putting pressure on the government quite strongly so they know what’s going on.

"New Zealand can’t be part of the TPP if it has a state monopoly, so Zespri’s got to go one way or another."

But trade ambitions aside, Gibbs highlights a range of legal factors pointing to Zespri's alleged breach of non-discrimination and non-diversification aspects of the country's Kiwifruit Export Regulations 1999.

"We’re now looking at the rest of the case, in terms of what the breaches are, and there are quite a few. With growers, suppliers and post harvest operators they’ve been getting exclusivity contracts, so we’re going to give that a good nudge," he says.

"They also tried to control kiwifruit exports to Australia in 09/10, and they’re simply not allowed to do that. They’ve also tried to control new kiwifruit cultivars.”

In the initial hearing last year the court found Kiwifruit New Zealand (KNZ) had exclusive jurisdiction to handle complaints relating to kiwifruit exports, but Gibbs' argument is that KNZ does not hold the independence that befits a regulatory body.

"Zespri, Kiwifruit New Zealand and the New Zealand Kiwifruit Growers Association are not independent. What they have is more like a club," he says.

Gibbs' resignation as Turners and Growers chairman was effective as of Apr. 20, but he says he is still working with the company on its kiwifruit-related issues. His position has been filled by Rob Campbell.

A Zespri spokesperson says the company can only give limited comment for the case, but is confident Turners & Growers will not succeed in its claims.

"The current litigation relates to claims under the Commerce Act, and is the second part of T&G’s litigation from 2009 challenging the Kiwifruit Export Regulations," he says.

"Their challenge to the Kiwifruit Export Regulations was dismissed by the High Court last year, and we are confident that these claims are also unlikely to succeed.”


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