Mill Street Pak'nSave fined for misleading customers with price errors

Hamilton's Pak'nSave Mill Street has been fined $346,500 in the Auckland District Court after pleading guilty to repeated pricing errors that misled customers.

The supermarket was one of two Foodstuffs North Island stores sentenced on the same day. Pak'nSave Silverdale, in Auckland, was fined $234,000 across ten charges, while Mill Street received the larger penalty of $346,500 across eight charges — a combined $580,500.

Both stores were prosecuted by the Commerce Commission under the Fair Trading Act, after the shelf price displayed in-store failed to match the price charged at the till.

Commerce Commission Deputy Chair Anne Callinan said the Commission has long put major supermarkets on notice about meeting their fundamental responsibility to ensure the price on the shelf matches the price at the till.

"Despite this, Auckland's Pak'nSave Silverdale and Pak'nSave Mill Street, in Hamilton, have now been criminally convicted for repeated pricing errors that misled their customers," Callinan said.

"The Commission will not hesitate to prosecute other supermarkets if we believe there is wrongdoing. Consumers are entitled to rely on accurate pricing, that is the bottom line. These are highly profitable stores who should be investing in pricing systems that ensure these errors that mislead consumers do not happen."

The Commission said it is still awaiting the full written judgment, which will be made available on its case register in due course.

Callinan said the Commission is satisfied with the penalty secured under current legislation, but the case highlights the necessity of the Government's current review of the Fair Trading Act.

"Increasing the penalties and changing to a civil regime as proposed will give us the option to push for fines of up to $5 million for each breach, compared to our current maximum of $600,000," she said.

"Fines in this range would have a much stronger deterrent effect and encourage genuine behaviour change."

The Commission's case against Woolworths NZ for similar conduct remains ongoing, with Woolworths having pleaded not guilty. Grocery-sector breaches remain an area of focus, with several ongoing matters involving the country's major supermarkets — including current proceedings against Foodstuffs North Island and Gilmours alleging cartel conduct, and separate civil proceedings announced in August against Foodstuffs South Island over an alleged restriction on independently owned Pak'nSaves discounting selected products.