Commerce Commission Issues Draft Determination On HP New Zealand’s Application To Engage In Resale Price Maintenance

The Commerce Commission has reached a preliminary view that it should allow HP New Zealand Limited (HP) to engage in resale price maintenance (RPM) in relation to its proposed HP online stores and HP online marketplace stores.

On 22 March 2021, HP applied for authorisation to engage in RPM in relation to its HP stores. The conduct for which HP seeks authorisation involves HP specifying the prices for which a third-party distributor will sell HP products to consumers on the HP Stores. The Commission has reached a preliminary view that authorising RPM in this case is likely to lead to a net public benefit and that it would be appropriate to grant authorisation for 5 years.

The Commission’s preliminary view is based on its assessment of the likely benefits and detriments. The Commission considers that the HP stores are likely to provide many of the customer-experience benefits claimed by HP, while the RPM for which HP seeks authorisation is unlikely to cause any detriments and will only apply to products sold through the HP stores.

Interested parties are welcome to make submissions on the draft determination. Submissions are due by 5pm on 20 August 2021 and can be sent to registrar@comcom.govt.nz, with the reference “HP Authorisation” in the subject line.

The draft determination is available on the Commission’s case register.

Background
HP is a member of the HP group. Its US listed parent company, HP Inc, is a manufacturer of HP-branded technology products including desktop computers, notebooks, printers and related accessories.

Authorisation requirements 
The Commission may grant authorisation under section 58 of the Commerce Act for certain arrangements that may otherwise breach the Commerce Act, if it is satisfied that the public benefits of the arrangements outweigh the detriments arising from the loss of competition. The granting of an authorisation protects the applicant from court action under the Commerce Act by the Commission and private individuals.

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