'$2m payment demanded'

VERNON SMALL
Last updated 05:00 21/03/2014

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The Commerce Commission has refused to confirm whether it received a complaint from a supplier, later withdrawn, that Countdown asked for a $2 million retrospective payment. 

The commission launched a probe into the big supermarket group after Labour MP Shane Jones in Parliament accused it of demanding retrospective cash payments from suppliers.

During a parliamentary committee hearing yesterday Labour MP Clayton Cosgrove asked: ‘‘Can you confirm that after a complaint of a $2 million retrospective payment was made to the commission ... that that complaint effectively vanished because Progressive went to the supplier and basically said it was a big, big mistake, they didn’t want $2m and it just vanished from the face of the earth.’’

Commission chief executive Brent Alderton said he could not confirm that.

He said the commission had received a number of complaints – fewer than 30 – and most had been against Countdown, owned by Progressive Enterprises.

There had also been some general industry complaints, but it was not appropriate at this stage to widen the probe, he said.

Seven staff were allocated to the investigation which he expected would take several months to complete.

Jones’ allegations had included that suppliers were summoned to meet Countdown management and told that if they did not make cash payments they faced permanent exclusion from the shelves. 

Progressive Enterprises managing director Dave Chambers yesterday again rejected the allegations.

‘‘It’s disappointing that a month down the track we’re still no clearer on what the alleged misconduct is; we haven’t seen anything to support the claims made under parliamentary privilege and we don’t have any further detail on what the Commerce Commission is investigating.’’

The company remained confident its practices were above board and it would continue to co-operate fully with the investigation.

In response to a range of questions related to  Jones’ allegations,  Alderton told the committee  it was not appropriate to disclose the nature of complaints. 

The commission would be approaching suppliers who had not complained.

Cosgrove asked if there was a difference between a retrospective payment and forward payments based on retrospective data, suggesting that may be the defence Countdown puts forward..

Alderton said that would involve him ‘‘speculating’’. The commission simply made an assessment of behaviour against the Commerce Act.

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He guaranteed anonymity to complainants and said information would only be disclosed if required by law.

Cosgrove declined to comment further on his questions outside the committee.

‘‘You’ve seen from the Commerce Commission that they now have a series of complaints. This has gone from an issue of hearsay to a formal inquiry. That shows the gravity of the issue.’’


- Fairfax Media

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