By JOSIE CLARKE consumer reporter
BP is under investigation by the Commerce Commission over alleged price-fixing.
Deputy Prime Minister Jim Anderton announced the investigation yesterday.
He said he had handed the commission documents showing that one oil company had offered financial incentives to independent retailers in return for setting prices at the pump.
Mr Anderton declined to name the company, saying the investigation needed to follow due process.
But commission spokesman Vince Cholewa confirmed that staff had been investigating BP's price support system for about a month. He said a decision would be made in a few weeks.
Mr Anderton said he had received advice questioning the lawfulness of the scheme, called the "temporary price support system."
The commission had begun its investigation without any pressure from the Government, he said.
BP spokeswoman Jane Diver said retailers could do what they liked with prices, but could apply to BP for a "top-up" if their margins were squeezed by local competition.
BP discussed the system with the commission when it was introduced in 1998.
"We're very confident that we're going to be found in the clear," Ms Diver said.
BP was baffled by Mr Anderton's announcement, particularly because the investigation had been under way for a month and had not reached a conclusion.
Mr Anderton said the Wellington retailer at the centre of the allegation had been offered monthly payments to compensate it for losses created by holding prices at a certain level.
It appeared the scheme was run nationwide.
Mr Anderton said it was important the scheme was questioned in terms of what influence it could have on petrol price-fixing above or below the levels that competing individual retailers might want to set.
He stopped short of accusing the major oil companies of colluding, saying he had information only about one company.
"But it does actually give some indication of how prices are held high or low, and what inducements are given to do that," Mr Anderton said.
"The idea that petrol companies are paying to keep prices up or down is information that I have never had before.
"The fact that the Commerce Commission has chosen to investigate would indicate that it's new information for them too."
Shell spokesman Antonius Papaspiropoulos would not comment on whether his company had a similar scheme.
"I have no views on what BP does.
"As for what schemes we have, that is a matter of commercial sensitivity, between us and our retailers."
A spokesman for Mobil said the company was not implicated in any anti-competitive practices such as those Mr Anderton suggested.
Caltex spokesman Bruce Hollet said his company did not provide any incentives to retailers to set their prices.
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