By PHILIPPA STEVENSON
The small company behind the Premium Milk brand may be the first to test the dispute provisions of legislation enabling dairy giant Fonterra to be established.
Auckland-based Independent Dairy Producers (IDP) has sought a Commerce Commission determination on the price it has been paying Fonterra for raw milk.
The request
comes under the Dairy Industry Restructuring Act, which last year allowed Fonterra to be set up with control of 95 per cent of the country's milk supply.
A complicated formula regulates the price independent companies pay Fonterra for milk.
IDP is a privately owned dairy company that has processed and supplied the cut-price Premium Milk brand in Auckland and the Waikato for four years.
Commission market behaviour group manager Jan Compton said yesterday Fonterra had until September 9 to comment on the issue, after which the commission had 10 days to decide whether to make a determination.
The commission can rule on what a party to a dispute must do, or stop doing, and may order compensation be paid.
The commission has been investigating allegations of anti-competitive behaviour against the two main milk suppliers, Fonterra's Mainland, and New Zealand Dairy Foods, since April.
Another small milk company, Tussock Milk, complained the big companies were cutting prices to retailers.
