Non-Discrimination Rule, Prior Notice Rule, Non-Diversification Rule and Information Disclosure Requirements (Mitigation Measures)
KNZ as the regulatory body is charged with monitoring and enforcing a range of "mitigation measures." The purpose of the mitigation measures is to mitigate the costs and risks associated with the single desk regime by:
- encouraging innovation in the kiwifruit industry while managing risks associated with activities that are not core business;
- promoting efficient pricing signals;
- providing appropriate protections for kiwifruit growers, Zespri shareholders and suppliers; and
- promoting downward pressure on Zespri's costs.
KNZ carries out its functions to best achieve these purposes.
There are four mitigation measures that KNZ is responsible for monitoring and enforcing:
The Non-Discrimination Rule. This rule provides that Zespri must not unjustifiably discriminate in the way it purchases New Zealand grown kiwifruit.
The Prior Notice Rule. Before carrying out activities that are not core business, but do support core business, Zespri must inform KNZ.
The Non-Diversification Rule. Zespri is prohibited from carrying out activities that are not core business and do not support its core business (as defined in the Regulations) unless approved by kiwifruit producers. Core business is the purchase of New Zealand grown kiwifruit for export (other than for consumption in Australia) and includes the marketing of New Zealand grown kiwifruit, market development for New Zealand grown kiwifruit and research and development relating to kiwifruit.
The Information Disclosure Requirements. Zespri is required to make certain information (eg. financial statements and kiwifruit supply contracts) available to the public and KNZ within specified timeframes.
For more detailed information on the mitigation measures, please click on the links below.