Zespri to appeal High Court decision

After a judicial review on May 3, Kiwifruit NZ was ordered to rehear collaborative marketing applications by Seeka and Splice Fruit.

Zespri Group has filed a notice of appeal against parts of a recent High Court judicial review that overturned decisions by regulator Kiwifruit NZ on proposed collaborative marketing agreements submitted by two Bay of Plenty kiwifruit exporters.

Peter Luxton, Splice Fruit.

The High Court, in a fast-track judicial review on May 3, ordered Kiwifruit NZ (KNZ) to rehear two applications by Seeka Kiwifruit Industries, and one by Splice Fruit, which had been rejected late last year. Both proposed collaborating with Zespri as required by the regulations for collaborative marketing agreements.

All three applications were originally rejected by KNZ last December, for reasons given in writing in January, 2016.

After the High Court decision, KNZ re-heard and again rejected the applications.

A Zespri representative said that Zespri had received feedback from industry stakeholders that the High Court decision might be open to different interpretations.

"This is a procedural step which allows us to preserve the right to appeal the decision while we decide whether clarification is required on the broader collaborative marketing principles. "The court's comments have generated industry discussion on the extent of collaboration now required for collaborative marketing and whether or not Zespri can engage in collaborative marketing programmes under the regulations without KNZ's approval."

Seeka chief executive Michael Franks said the company was obtaining legal advice on Zespri's notice of appeal and was unable to comment at this stage.

Splice Fruit's owner Peter Luxton said it was not clear on what substantive basis Zespri was appealing and accordingly he was seeking legal advice.

"It can only be hoped that this will help throw further light on to the shortcomings of the current collaborative marketing process and outcomes, and return the collaborative marketing mechanism to its original purpose of increasing overall wealth for New Zealand kiwifruit suppliers," he said.

Zespri has, since 2000, been the primary mandated exporting organisation for kiwifruit. Companies seeking to export to all countries other than Australia need to seek permission from KNZ.

The regulator was named as the respondent when Seeka and Splice initially filed for a High Court judicial review, but Zespri was added as the second respondent at the request of both KNZ and Zespri.

In the current notice of appeal, Zespri is the first appellant and KNZ is the second.

KNZ chief executive Geoff Morgan said Zespri was appealing on two grounds. One was to clarify whether the judgment held that Zespri was empowered to enter into collaborative marketing agreements without first obtaining the approval of KNZ.

The other point focused on defining the factors that made up collaboration.

"As the regulator we have to abide by the court's decision, so we can't really take the action of appealing it," said Mr Morgan. Zespri's action would be useful in assisting in the clarity of the judgment, he said.

Rejected proposals:

* Proposed collaborative marketing agreements rejected by Kiwifruit NZ:

* Seeka Kiwifruit Industries planned to export 400,000 trays of Green fruit to Hainan Island in China and 120,000 trays of Green fruit to Xinjiang province in China.

* Splice Fruit wanted to export 400,000 trays of Green Organic fruit to Austria.