NEW ZEALAND BUSINESS NEWS
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The Auckland District Court fined two Pak’nSave supermarkets a combined $580,500 after they admitted to inaccurate pricing under the Fair Trading Act. The court fined Pak’nSave Silverdale $234,000 on ten charges, and Pak’nSave Mill Street in Hamilton $346,500 on eight charges. Both entered guilty pleas, which means the stores now carry criminal convictions rather than a civil penalty.
The charges centred on pricing errors that misled customers—the gap between what a shelf ticket said and what the till charged. For a grocery business, that gap is its most visible promise; a shopper has no way to check the price except at the moment of payment.
Supermarkets deal in thousands of product lines, and prices change frequently. The Commission’s position is that keeping shelf tickets and checkout prices aligned is not an administrative nicety but a basic trading obligation. Its deputy chair, Anne Callinan, said the Commission had put major supermarkets on notice about that responsibility for some time, and that the two stores had been convicted for repeated errors that misled their customers.
She also said the stores are highly profitable and should invest in pricing systems that prevent misleading errors. The Commission has signalled it will prosecute other supermarkets where it believes wrongdoing exists, and that consumers are entitled to rely on accurate pricing.
The Commission has yet to receive the full written judgment, which will be placed on the case register in due course.
The fines were imposed under the current law, which caps the penalty at $600,000 for each breach. The Government is reviewing the Fair Trading Act, and the proposed changes would raise that ceiling to as much as $5 million per breach and shift the regime from criminal to civil. Callinan said the Commission was satisfied with the penalty it secured under existing legislation, but that the case shows why the review is needed. In her view, fines at the proposed level would deter misconduct more strongly and encourage genuine changes in behaviour, while producing fairer outcomes for consumers and a more level playing field for businesses that follow the rules.
The Commission continues to prioritise grocery sector breaches, and several matters involving major supermarkets are live. Its case against Woolworths NZ over similar conduct is continuing, with Woolworths pleading not guilty. Separate proceedings allege cartel conduct by Foodstuffs North Island and Gilmours. The Commission has also brought civil proceedings against Foodstuffs South Island over an alleged restriction on independently owned Pak’nSaves discounting selected products, announced in August. Callinan said the Commission will keep using its current powers to hold the major supermarkets to account on behalf of New Zealanders.
For any retailer running a shelf-price system, the case reminds us that pricing accuracy is enforceable, not merely a customer service standard. Repeated errors, rather than a single slip, were enough to produce convictions and a six-figure penalty for each store.
For smaller operators without dedicated pricing teams, the practical exposure sits in the same place: the handover between head office price files, store ticketing, and the point of sale. Where those three drift apart, the customer sees one price and pays another. The Commission’s stated intention to pursue other supermarkets suggests the scrutiny is not confined to the two stores fined here, and the proposed increase in maximum penalties would raise the cost of getting it wrong.
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