Police investigate alleged kiwifruit fraud

Zespri has zero tolerance for any breaches relating to its plant rights, says chief operating officer Simon Limmer. Photo/file

Police have confirmed they are investigating the alleged illegal transfer of kiwifruit cultivars to China in what Zespri says is the first such case it has encountered.

Zespri says it discovered the cultivars last April as a result of information passed on to its team in China, where the cultivars were believed to have been established "on a relatively small scale" in 2012.

The varieties were SunGold (G3), and Zespri Charm (G9). Both were initially commercialised in 2010, with SunGold going on to become the dominant Psa-resistant and very valuable Gold that has been swelling recent production volumes. Zespri Charm was much less successful and was subsequently de-commercialised because of persistent problems with its skin texture.

The Tauranga-headquartered kiwifruit export organisation advised its growers and shareholders on Monday that it had asked police to investigate the problem, because it could involve criminal issues in New Zealand. Zespri declined to reveal where the parties allegedly responsible were based, because the investigation was ongoing.

A police spokesperson said the matter had been reported to police and the investigation was ongoing.

"We have a strong local team in China which was alerted to this, showing the value of having people on the ground in the industry," said Dave Courtney, general manager grower and external relations.

"We've taken decisive action to protect our plant variety rights here and offshore."

Zespri chief operating officer Simon Limmer said Zespri completed its China diligence in December and provided evidence to the New Zealand Police to assist with their investigation.

"In responding to the case, Zespri is working with a number of parties to resolve the issue and we will update the industry in due course. We do not believe that the situation has any material impact on our outlook for Gold3."

Mr Limmer said the alleged breach involved plant material transferred to a third party contrary to the terms of Zespri's licence, possibly relating to the fraudulent sale of licence rights.

"The purported sale of a licence from one jurisdiction to another by a third party is a breach of Zespri's licences and plant variety rights," he said.

"Although the plantings may be relatively small scale in this specific case, we have zero tolerance for any breaches that we identify, wherever they happen."

New Zealand Kiwifruit Growers Inc chief executive Nikki Johnson said the allegations were very concerning for the industry.

Horticulture New Zealand chief executive Mike Chapman said New Zealand had grown horticulture exports 40 per cent in value since 2014.

"We have been driving that through grower know how and innovation," he said.

"New plant varieties are expensive to develop and we need to protect them in order to get the return on investment and market advantages that result. They help drive our exports."

Zespri SunGold (G3)

- Zespri is assessing the 2017 tenders for 400ha of 2017 Gold3 licence and is expected to make an announcement next week.

- More SunGold licence is scheduled for release in 2018, 2019 and 2020, based on performance and global demand.