6 August, 2002

Swain Releases Commerce Commission Airport Study

Commerce Minister Paul Swain released the Commerce Commission’s final report on airport activities at Auckland, Wellington and Christchurch international airports today.

The report considers whether airfield activities, provided by the three major international airport companies should be controlled under Part 4 of the Commerce Act 1986. It was first requested in 1998 by the then Minister of Commerce, John Luxton. In July 2001 Mr Swain widened the scope of the study by requesting the Commission’s advice on the thresholds that would him in assessing whether goods or services should be controlled under the Act.

The report is being released under sections 54(4) and 56(5) of the Commerce Act.

Copies of the report can be downloaded from the Minister’s website (http://www.beehive.govt.nz/swain) and the Ministry of Economic Development website (http://www.med.govt.nz/buslt/bus_pol/airports/index.html). An executive summary of the report is also available. Printed copies of the full report and the executive summary can be requested from the Minister’s Office ((04) 470 6565 or by fax on (04) 495 8566).

The Commerce Commission will brief the media on its findings at:

10.30am, Tuesday 6 August

Commerce Commission

Level 10, 44-52 The Terrace

Wellington

Mr Swain thanked the Commission for its work on the report, saying he was looking forward to considering the Commission’s findings.

“The Commission has put in an extraordinary amount of work into the airfield activities study in the four years since it was first requested,” he said.

Mr Swain invited written comments on any new matters raised in the report that were not the subject of previous submissions to the Commission and on any other relevant matters not addressed in the report. Interested parties have until Friday 6 September to make submissions.

“The Commission’s report follows thorough consultation between the Commission and interested parties, which included the publication of a draft report in July 2001 and a subsequent conference held last September. I do not intend to replicate the consultation process undertaken by the Commission in its study. I have, however, decided to provide interested parties with an opportunity to provide comments on any relevant matters that they have not previously commented on,” said Mr Swain.

Once he has considered the report and any comments from interested parties, the Minister will make a decision on whether or not to recommend to the Governor-General that airfield activities at one or more of the three major international airports should be controlled under the Commerce Act. A decision will not be made until after the formation of the new government and the confirmation of ministerial warrants. “We hope to make a decision before Christmas,” said Mr Swain.

Comments on the report should be sent to:

Airports Price Control Inquiry

Regulatory and Competition Policy Branch

Ministry of Economic Development

PO Box 1473

WELLINGTON

By email to: mark.simpson@med.govt.nz

Or by fax: (04) 499 1791

Comments must be received no later than Friday 6 September, 2002

Additional information:

Under section 56 of the Commerce Act 1986, the Minister of Commerce can request a report from the Commission on whether or not an order in Council should be made under section 53 of the Act to declare that particular goods or services are controlled. The Minister can only recommend that the Governor-General make an order if he is satisfied that the goods or services can be controlled under section 52 of the Act.

Under section 52, goods or services can be controlled if:

- they are acquired in a market in which competition is limited or is likely to be lessened; and

- it is necessary or desirable for those goods to be controlled either:

„« in the interests of persons acquiring the goods or services, if the goods or services are acquired from a person who faces limited or lessened competition for the supply of those goods or services; or

„« in the interests of suppliers, if the goods or services are supplied to a person who faces limited or lessened competition for the acquisition of those goods or services.

Section 54 of the Act allows the Minister to require the Commission to advise him on the thresholds that would assist him in assessing whether goods or services should be controlled under section 52.

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