KEY POINTS:
Auckland Airport is reviewing whether new documents from the Commerce Commission have implications for its plan to move to a sole duty-free operator.
The commission yesterday released its reasons for declining clearance for Hong Kong-based duty-free operator DFS Galleria to buy out Swiss-based rival The Nuance Group, which runs the Regency stores in New Zealand. The decision was originally made public in late March.
Commission chairwoman Paula Rebstock said the proposed acquisition would see the removal of competition posed by Nuance. Customers would no longer have a choice of duty-free retailers, and no longer have the ability to compare prices between competing retailers at Auckland International Airport.
In its decision, the commission predicted that duty-free prices would increase after a sale.
"If the experience at Wellington International Airport were replicated at Auckland International Airport, consumers could expect to pay in the order of 10 per cent more for duty-free goods."
The reasoning behind the decision could have implications for the commission's investigation into the airport's move from having two duty-free operators to one.
The airport had last month asked for tenders from DFS and Nuance for the sole right to operate a general duty-free concession. DFS' successful bid gave it more than seven years as the airport's sole operator once Nuance's existing licence expires on August 3 next year.
Airport management noted that the commission's decision on DFS' proposed buy-up of Nuance was a separate issue.
"Until the current Commerce Commission investigation is concluded, and any effects arising therefrom are assessed, any impact on duty-free concession revenue to be received by Auckland Airport cannot be determined."
Airport management did not think that the impending move to one operator had breached the provisions of the Commerce Act.
Instead, the move would enhance "the depth and breadth of goods offered and make it a more attractive and competitive shopping destination relative to other international airports". Airport shares closed up 3c at $1.94.
