Preliminary clearance for Fonterra on overcharging

Fonterra has been given preliminary clearance by the Commerce Commission on what appears to be a technicality over allegations it had been over-charging for its wholesale milk.

In October, Waharoa-based public company Open Country Cheese complained to the commission the dairy giant had unfairly included capital profits in its wholesale milk price calculations.

The commission said it had reached a preliminary view Fonterra had not breached the Dairy Industry (Raw Milk) Restructuring Regulations.

The parties have until December 5 to respond to the draft determination and Open Country chief executive Alan Walters said the company was "considering its options".

Open Country asked the commission to determine whether capital profits from Fonterra's sale of its shares in Wrightson and National Foods should be included in the calculation of the wholesale milk price.

Under the regulations, Fonterra is required to supply Open Country with raw milk at the default milk price - the wholesale milk price for the season, plus transport costs.

- NZPA