Revamp for Commerce Act

The Commerce Commission has welcomed the government’s plans to update the Commerce Act with measures to enhance competition.

The proposals include action to deter creeping acquisitions and predatory pricing, and changing the regulator’s governance structure to support its expanding role.

“The changes will allow us to accelerate and deepen the direction we’re taking to enhance competition in the economy, and improve choice and quality for New Zealanders,” says Dr John Small, pictured, commission chairman.

“The government’s decisions will ensure the commission is future-focused and has the right tools. This means we will be ready for the competition challenges in the years ahead.

“We’re pleased the recent review of the commission’s governance and effectiveness, and the government’s response to it, confirmed we are a strong and trusted organisation.

“We welcome the review and its recommendations, and accept the challenge from the reviewers to become an even stronger and more resilient competition agency. We are delivering governance and operational changes well-ahead of legislative change.

“With the minister’s endorsement, we’re getting on with those changes right now. The future changes to the legislation will further unlock that direction.”

Adrienne Meikle, chief executive of the Commerce Commission, adds: “On October 1, we’re going live with our New Ways of Working. This is focused on improving the pace of our decision-making and increasing the benefit we provide. 

“We’re already implementing changes. These include improving how we engage with and listen to our stakeholders, and strengthening our voice on why competition matters. As a key part of this work, we’ll be publishing an annual State of Competition in NZ report.”

Small says: “Our new ways of working are focused on enhancing competition for the
benefit of all New Zealanders. They’ll help us get ahead of the competition issues that matter in our economy.”

View from the Beehive

The coalition says it is beefing up the Commerce Act for the first time in nearly 20 years to provide greater protection to the public.

“These changes also provide more certainty and reliability for businesses,” says Nicola Willis, Minister for Economic Growth.

“Competition is a key driver of growth, innovation and productivity. Consumers and businesses thrive when markets are open and fair. But current settings are outdated, lack clarity and have led to some of our most important markets being dominated by only a handful of players.” 

Key changes being proposed for the Commerce Act include: 

• Stopping unfair tactics such as creeping acquisitions and predatory pricing so genuine competitors can thrive.

• Clearer merger rules to give businesses certainty while keeping markets fair.

• A stronger, better-structured Commerce Commission meaning faster, more transparent decisions.

• Streamlined approval for beneficial collaboration making it easier for companies to work together when it helps the public.

• Allowing businesses to voluntarily undertake to limit market power as part of merger applications. 

“As part of the changes, the commission will be strengthened to ensure it can continue to be an effective agency and is fit for purpose for the additional powers it has been given,” says Scott Simpson, Minister of Commerce and Consumer Affairs.

“An independent review found the Commerce Commission has outgrown its current structure with the board handling both governance and regulatory decisions. By separating these functions, it will be able to deliver better outcomes for consumers. 

“Competition is needed. However, there is sometimes a benefit to having competitors collaborate when there are public benefits and no harm is done to competition. The proposed changes will streamline approval for collaboration between businesses.  

“The commission will gain stronger tools, including the ability to pause or ‘call in’ risky mergers before they are completed. This targeted power ensures problematic deals can be properly assessed.   

“The commission will also be able to accept commitments from businesses – known as behavioural undertakings – to help resolve competition concerns arising from a proposed merger. Alongside this, clearer statutory timeframes will support more timely and transparent decisions. 

“These changes will ensure the merger regime is fit for purpose, making it easier to identify and stop deals that could harm competition.   

“Importantly, these changes lift the bar on which mergers can proceed. This will prevent dominant firms entrenching their power, and give businesses and consumers more choice, sharper prices and fairer markets.”  

The changes are reflected in amendments to the Commerce Act that will be introduced to parliament before Christmas and passed by mid-2026.  

Willis has also released an update on the government’s Going For Growth work programme. The competitive business settings update sets out how the coalition “is making it easier for businesses to operate and grow so they can create more jobs and lift Kiwi incomes”.