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HP seeks to fix prices in New Zealand

March 22, 2021

HP has applied to the New Zealand Commerce Commission to fix prices via a price maintenance agreement for its HP online store and prospective HP online marketplace stores.

The New Zealand Commerce Commission has received an application from HP New Zealand (HP) on the 19 March requesting permission to engage in resale price maintenance (RPM) concerning its proposed arrangements for its HP online store and prospective HP online marketplace stores.

HP does not currently sell directly to consumers in New Zealand, and the proposal will see HP supplying their products to a third-party distributor, which will be for direct sale to customers via a new HP e-commerce platform.

HP is seeking permission to control the products, prices and marketing strategies which the third party will sell the HP products to consumers via the HP online store or future HP online marketplace stores.

In New Zealand, resale price maintenance occurs when a supplier of goods enforces or tries to enforce a minimum price the reseller must on-sell those goods. A reseller may be a distributor or a retailer. Resale price maintenance prevents resellers from setting their prices independently and can lead to increased prices for consumers. It is a form of anti-competitive conduct and is unlawful.

Suppose a company wants to engage in conduct that may risk breaching the Commerce Act’s resale price maintenance provisions. In that case, you have to seek authorisation from the Commerce Commission. Providing the Commission is satisfied that the resale price maintenance will result, or be likely to result, in benefits to the public that will outweigh the harm.

You can read the application here.

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