Action against Mobil NZ

The Commerce Commission is taking legal action against Mobil New Zealand’s head office for pricing methods it believes breach the Fuel Industry Act (FIA).

The regulator has filed high-court proceedings. These allege two ongoing breaches of section 16(1)(a) of the FIA – one starting in November 2021 and the other in August 2022.

“We think wholesale prices methods Mobil NZ’s head office has used to calculate what it charges petrol stations [dealers] aren’t transparent enough to meet its obligations,” says commissioner Bryan Chapple. The purpose of the act is to improve competition in the market for the long-term benefit of consumers, so we take any suspected breaches seriously.

“A lack of transparent wholesale prices means independent petrol stations aren’t able to see and question the rates Mobil is charging. The flow-on effect is Mobil head office is able to increase prices with minimal pushback, putting pressure on retail prices.”

One of the ways the market operates here is through large international companies importing and then selling fuel at wholesale to independent dealers who own and operate petrol stations. Many dealer-owned stations use the branding of larger companies but are run independently.

The proceedings the commission has filed are regarding Mobil’s wholesale operations, which affect independent dealers. The maximum penalty under the FIA is $5 million per breach.

Chapple adds: “A lack of pricing transparency for dealers makes it harder for them to offer the best prices for customers.”