Countdown clues sought

The Commerce Comission is investigating claims of blackmail and extortion by Countdown. Photo / APN

The Commerce Commission has begun using its powers to compel people to give up information for its inquiry into alleged blackmail and extortion by supermarket giant Countdown.

A commission spokesman said it had issued notices to "a number of parties" which required them to co-operate with the inquiry.

The "section 98" notices were similar to a subpoena and anyone who failed to comply risked a fine of up to $30,000.

The spokesman said it was common practice for a commission investigation. He would not reveal who the notices had been sent to.

Food and Grocery Council head Katherine Rich said it appeared the commission was casting its net widely, because she knew of small, large, local and overseas companies who had received the notices last week.

"It looks like they've taken a significant sample of the entire grocery sector," she said.

Ms Rich said it was a positive development because the investigation was a highly sensitive issue and many suppliers were reluctant to come forward.

"There is a level of fear and in terms of the Commerce Commission's move, companies are aware that they must comply with New Zealand law so the decision about whether or not to supply information is made for them.

"The decision to issue these notices means once and for all there will be a very thorough investigation."

Labour's commerce spokesman Clayton Cosgrove also welcomed the commission's decision. He said evidence gained by compulsion was likely to be more useful than information which was volunteered.

"Once you are compelled, if you play fast and loose or you don't provide the information, or you don't provide truthful evidence, then you're in trouble legally."

The investigation was prompted by allegations made by retiring Labour MP Shane Jones under Parliamentary privilege. The commission was looking at Mr Jones' claims that Countdown's owner Progressive Enterprises had been blackmailing suppliers into making retrospective payments to keep products on shelves.

Progressive rejected the allegations against its business.

In a statement last night it said it was cooperating with the Commerce Commission investigation and have received a section 98 request.

"As the Commerce Commission has noted, this is a standard part of their investigation process and it's only natural they want to have an accurate understanding of the facts.

"We welcome a fair and fact-based assessment and we'll continue to cooperate with the Commission."