Tough-talking watchdog quits

Paula Rebstock's manner divided critics. Photo / Mark Mitchell

Commerce Commission chairwoman Paula Rebstock is stepping down following agitation for change from some in big business.

The Government says it has accepted her decision "with regret" and had been keen for her to stay on after 11 years on the commission. Commerce Minister Simon Power said he was discussing with Rebstock how her skills and experience might be used in other senior roles.

The commission has increasingly been under attack, including from competition lawyer Grant David and Business Roundtable chief executive Roger Kerr, as having become too activist on Rebstock's watch.

And Power said last month he was "casting a fresh eye" on the commission which built up a powerful team of specialist lawyers under Rebstock's leadership.

She led the commission when it regulated aspects of telecommunications, electricity, gas and dairy industries, affecting large corporates such as Telecom, Vector, Transpower and Fonterra.

The commission also blocked a merger plan between Qantas and Air New Zealand, prosecuted banks for poor disclosure of fees and stopped Woolworths and Foodstuffs bidding for The Warehouse.

It has also carried out prosecutions in the wood processing industry, packaging industry and has launched a major case in the air cargo industry.

She leaves as the commission is about to release a report investigating claims of market manipulation among power generators.

Rebstock will be replaced by lawyer Mark Berry, who takes over on April 1 for the next 18 months until a permanent replacement is found. Rebstock's departure comes after more than five years chairing the board of the commission.

Berry said he had been approached to take up the opportunity and had been in discussions about it for some time, although he could not specify for how long.

A competition specialist said yesterday there had not been the usual casting about for the post and it was felt Rebstock's departure was sudden.

United States-born Rebstock introduced a forthright, direct approach to dealing with competition and regulatory issues, making powerful enemies along the way.

Berry is seen as "a safe pair of hands" with a less confrontational style but with a strong policy background as well as his commercial experience. The 51-year-old has been a Wellington barrister specialising in competition law since 2002 and a member of the bar since 1980.

He was previously deputy chairman of the Commerce Commission from 1999 to 2001, stepping down when his term expired.

Commerce Commission chief executive Nicholas Hill said Berry was well placed to take over the role.

"Dr Berry's professional experience and background with the commission ensures he is well placed to smooth the transition as he takes up the reins at the commission."

Power said the commission was fortunate to have someone as experienced as Berry available for the position.

"This will enable the Ministry of Economic development to undertake a competitive recruitment process for the position."

Power said Rebstock's skills and experience had been instrumental in raising the effectiveness of the Commission.

One competition lawyer said he was not surprised by her departure from the $446,000 a year role.

Simpson Grierson senior associate and specialist competition lawyer James Craig, who had worked on behalf of the commission, said there had been talk that the Government was reviewing various departments and some talk that Rebstock's turn was coming up.

"There was speculation Rebstock wanted to step down."

Craig said Rebstock had raised the profile of the commission and businesses had become much more aware of competition law during her reign.

"The commission became more formidable under her watch."

Prime Minister John Key was asked whether the Government agreed with the commission's most outspoken opponents and, if so, if it might have formed any part of her decision to step down.

"We back the regulator," he said. "It's very important to have strong competition policy in New Zealand."

REBSTOCK'S SCALPS

Some of the Commerce Commission cases under Paula Rebstock:

Telecom and Vodafone: The Commerce Commission is considering regulating termination charges - the prices that telcos charge rivals for callers into their networks.

Airline cartel: The commission in December initiated High Court proceedings against Air New Zealand, seven staff and 12 other airlines for alleged "extensive and long-term cartel activity in the air cargo market".

The Warehouse: In 2007 the commission prevented supermarket groups Foodstuffs and Woolworths from bidding for The Warehouse. The decision was successfully appealed in the High Court but this ruling was reversed by the Court of Appeal.

Vector: The commission in 2006 threatened to declare control over the distribution services of Vector after concluding its pricing strategy was unfair. Vector last year reached an agreement over its charging structure.

Air New Zealand and Qantas: In 2003 the commission blocked a plan by Qantas and Air New Zealand to co-operate on New Zealand domestic routes and those across the Tasman. A High Court appeal by Air New Zealand failed.