Commerce Commission takes Mitre 10 operator to court over action allegedly to prevent Bunnings build

Mitre 10 Mega in Cameron Rd, Tauranga. Photo / Mead Norton

The Commerce Commission alleges a company operating a Mitre 10 bought land in Tauranga and tried to prevent a Bunnings Warehouse from being built on it.

The commission has filed proceedings in the High Court in Wellington in its anti-competitive land covenant case against NGB Properties Ltd for allegedly contravening section 28 of the Commerce Act.

NGB is a sister company of Juted Holdings Ltd and operates the Mitre 10 Mega in Tauranga, the commission said in a statement today.

Section 28 prohibits land covenants that have the purpose, effect, or likely effect of substantially lessening competition.

The commission alleges NGB acquired a property in central Tauranga and placed a covenant on it that would have prevented a hardware store from being built on the property, the statement said.

The commission alleges NGB intended to prevent a Bunnings Warehouse from being built on the site by lodging the covenant.

In the statement, the commission said in its view, this amounted to a purpose of substantially lessening competition for the retailing of hardware and home improvement goods in central Tauranga.

The commission and NGB have agreed on a settlement to resolve the proceedings, the statement said.

A penalty hearing in the High Court at Wellington will be scheduled shortly.

Because the matter is before the court, the commission is unable to comment further for now, it said.

Bunnings director of store operations and New Zealand Ben Camire confirmed the Commerce Commission’s case against NGB Properties Limited was related to a land covenant allegedly lodged to prevent a Bunnings Warehouse from being built in Tauranga.

”As the matter is before the courts, we are unable to provide further comment.”

A Mitre 10 New Zealand Ltd spokesperson acknowledged the negotiated settlement between the Commerce Commission and NGB Properties Ltd.

“NGB Properties is an independently owned business which shares directors and shareholders with another business that is part of the Mitre 10 co-operative. Mitre 10 New Zealand was not involved in the matter.

“We note that the Commerce Commission has recommended an economy-wide review of restrictive covenants coming out of its recent market studies.”

The spokesperson said Mitre 10 New Zealand supported any review of current regulatory settings undertaken by the Commission or MBIE across the wider economy.

“We have no further comment while the matter is before the courts.”