Time may be issue in fuel price probe

The Commerce Commission will be under “considerable pressure” while undertaking its proposed investigation into petrol companies, its chairman Mark Berry has told MPs.

But the minister responsible for the commission said the regulator was “no stranger to pressure”.

Berry told the Economic Development, Science and Innovation select committee yesterday that it may take longer than a year to complete a thorough investigation.

Under new legislation — the Commerce Amendment Bill which was passed last month — the commission was given the power to initiate market studies into certain industries.

The first investigation would almost certainly be into petrol markets after Prime Minister Jacinda Ardern expressed her concerns that consumers were “being fleeced” at the pump.

Commerce and Consumer Affairs Minister Kris Faafoi said he would be nominating the petrol markets to be investigated next month.

Berry told MPs the ComCom’s $1.5 million funding would allow for one market study a year but warned the time pressure could be problematic.

The first market study into petrol companies is expected to begin in December.

Berry said it would not be completed until December 2019, or later.

“I do appreciate that people have a wish to know the results of these sorts of inquiries within much shorter time frames.

“But the experience is that if you put those kinds of time pressures on, the result is you don’t get the kind of detailed study that you would have wanted to get.”

He cited similar issues the Australia Competition and Consumer Commission (ACCC) had faced in regards to time pressures.

“The ACCC’s most recent market inquiries — many of them have been extended over the 12 months to get to the end of doing the kind of detailed analysis they think is necessary,” he said.

“While I know it sounds like a long time to wait until December 2019 we will be under considerable pressure to deliver the kind of study people want by that time.”

Speaking to media, Berry said the ComCom would endeavour to do the study within 12 months.

Faafoi, asked if he would be willing to give the regulator more time to conduct the study if it asked, said he “didn’t want to put the cart before the horse”.

He said the ComCom “is no stranger to pressure — we think 12 months is long enough; if they came back to us and said we might need more time, we will deal with it”.