Grower loses bid to break Zespri stranglehold

18:12, Aug 13 2010

A High Court judgment yesterday striking out three key claims raised by Turners and Growers in a bid to break Zespri's dominance of kiwifruit exports outside Australasia has left Turners with thousands of "new" kiwifruit vines being grown at Kerikeri to be planted out on orchards next year.

GPG subsidiary Turners is expected to have to come to a collaborative marketing deal with Zespri or continue its political and legal efforts to break Zespri's single desk to be able to sell the fruit beyond Australia.

Earlier this year, Turners and Growers announced plans for international commercial release of its own red cultivar, branded as enzared. In addition to plans for growing the fruit in New Zealand for export, it has also been setting up orchards for the crop in Italy, France and China.

Crucial to that was Turners' bid to break down Zespri in a High Court legal case, but the court yesterday ruled that the Kiwifruit Export Regulations 1999 - which underpin constraints on export from NZ - were validly established 11 years ago and that Kiwifruit New Zealand, the industry regulator, has exclusive jurisdiction to consider complaints under those regulations.

Zespri chief executive Lain Jager said last night the ruling represented "a natural juncture" in Turners' political campaign to break up the New Zealand kiwifruit industry.

"It would be highly desirable if Turners and Growers now decided not to subject kiwifruit growers, Zespri and its own shareholders to the further expense of prolonged litigation through an appeal," he said.

Mr Jager suggested that Turners should use collaborative marketing provisions -- which require novel cultivars and other proposed exports to be assessed for which is likely to provide the greatest benefits to the industry.

This would allow Turners and Growers to develop export opportunities that benefited both New Zealand kiwifruit growers and their own shareholders -- 17 other companies are already exporting kiwifruit through collaborative marketing programmes.

"The New Zealand Government, the New Zealand Opposition, 90 percent of kiwifruit growers and now the High Court of New Zealand have each confirmed their support for the existing arrangements," Mr Jager said.

"Now is the time for ... Turners and Growers to put forward sensible and robust collaborative marketing proposals capable of being accepted by the industry regulator."

Turners and Growers had no immediate comment on the judgment.