The ACCC has issued a draft notice proposing to revoke a resale price maintenance (RPM) notification lodged by Meredith Dairy, which would prevent retailers selling its goat cheese products below a price specified by Meredith Dairy.
“We consider that the proposed conduct would not result in a net public benefit,” ACCC Commissioner Roger Featherston said.
“The proposed minimum retail prices would mean retailers who are currently offering cheeses at lower prices to consumers could no longer do so.”
“It would also reduce the competitive pressure on other retailers to offer lower prices, including major supermarket chains,” Mr Featherston said.
The evidence provided to the ACCC by Meredith Dairy suggests that smaller retailers are advertising special deals to compete with larger retailers and the major supermarket chains.
Meredith Dairy also claims that discounting by some retailers is leading to demands from other retailers for lower wholesale prices so they can match the discounts.
However, Meredith Dairy has not presented evidence that the ongoing price competition at the retail level will jeopardise ongoing investment in its business.
“Having considered Meredith Dairy’s reasons, we consider that the reduction in retail competition would not be outweighed by any public benefit”, Mr Featherston said.
“We believe retailers should be allowed to charge customers prices as they see fit in a competitive market and not be forced to set prices according to Meredith Dairy’s wishes.”
Meredith Dairy and interested parties can now comment on the draft notice before the ACCC makes a final decision.
