Auckland to retain dual-retailer model after anti-trust pressure

Bill Lumley

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Following the New Zealand Commerce Commission’s intervention, the airport has decided to drop plans to move to a single-operator retail model

New Zealand’s largest airport has scrapped plans to cut the number of duty-free retailers from two to one, a month after the New Zealand Commerce Commission blocked DFS Group’s attempt to buy The Nuance Group’s Regency Duty Free.

This week Auckland International airport CEO Don Huse revealed that the company would not proceed with the previously-announced plans for duty-free operations from August 2009. He said the airport is now committed to retaining two operators until June 2015.

The move can be seen as a means of avoiding a prolonged dispute with the commission, which has been investigating the decision to cut the number of duty-free operators from two to one.

Following the announcement, the commission has formally notified the airport that it will cease its investigation, which it launched because it was “not satisfied the proposed acquisition would not have, or would not be likely to have, the effect of substantially lessening competition in the market for the retail supply of duty-free goods at Auckland airport to international air travellers”.

International passenger traffic at Auckland is about 7m a year. Traffic for June 2008, the most recent data available, totalled 470,342, down 1.7% on the previous June.

An airport spokesman said the decision will remove the uncertainty caused by the investigation process concerning international terminal building development projects.