Source: New Zealand Government
In Government, we’re busy working to grow our economy – and this includes improving competition settings. Today I can provide an update on where things stand across competition and consumer policy.
I’ll begin with the Commerce Act review and the governance of the Commerce Commission – two areas I know are top of mind for many of you.
Commerce Act review
The Commerce Act review was launched to modernise New Zealand’s competition law framework – the first review of its kind in 20 years.
The review looked at New Zealand’s merger regime, rules around beneficial collaboration, confidential information, industry codes, and the effectiveness of enforcement tools.
We received a wide range of submissions – most of them from the people in this room. Thank you to everyone who contributed – your feedback has been detailed, constructive, and very helpful.
As you know, the review was initiated earlier in the term and has been carried forward under new ministerial leadership. That transition has brought fresh perspectives while maintaining momentum on the work already underway.
I acknowledge the delay and appreciate your patience. Increasing competition is a central pillar of this Government’s Going for Growth Agenda. The issues are complex, have important implications across the economy, and I want to make the most of this opportunity to update our competition settings to promote business dynamism and lift economic growth.
Today, I’m pleased to announce the initial set of reforms to the Commerce Act, with further changes to be announced over the coming weeks.
First, we’re making changes to the Act to better support beneficial collaboration – because we’ve heard the current system is too complex, costly, and slow for business.
Right now, even low-risk, competitive collaboration – like joint R&D or emergency coordination – faces legal uncertainty and high barriers. The authorisation process alone costs nearly $37,000 and can take several months. That’s not workable for small businesses or urgent initiatives.
So, we’re introducing a new framework to make collaboration easier, while keeping competition safeguards in place:
- A statutory notification regime, initially limited to resale price maintenance and small business collective bargaining, will allow firms to notify the Commission of collaborative conduct and proceed unless the Commission objects – a faster, cheaper alternative to authorisation.
- Class exemption powers will allow the Commission to exempt categories of conduct that are low-risk or clearly beneficial.
- Fee relief mechanisms will give the Commission discretion to waive or reduce application fees where appropriate.
- A streamlined process for collaborative activity clearance will allow applicants to ask the Commission to assess the purpose and necessity of cartel provisions, without assessing broader competition impacts.
- Flexibility for evolving collaboration will allow clearance and authorisation for arrangements with changing participants over time – better supporting multi-party initiatives.
These changes will reduce duplication, simplify the process, and better reflect the original intent of the collaborative activity regime.
We have also heard in your submissions that businesses and individuals are increasingly reluctant to share information with the Commission because of fears confidential information could be released under the Official Information Act, potentially leading to retaliation or misuse of confidential information by competitors. This is undermining the Commission’s ability to collect evidence and receive useful information, particularly in investigations and merger clearances.
To address this issue, we are:
- Providing a 10-year OIA exemption for confidential information provided to the Commission.
- Extending the Commission’s ability to issue confidentiality orders over classes of information or documents, to attach terms and conditions on release, and to allow orders to continue to apply for up to 10 years.
- Protecting individuals against retaliation who provide information to the Commission – modelled on whistleblower legislation.
These changes will help restore trust, encourage cooperation, and ensure the Commission can access the information it needs – especially from complainants and whistleblowers.
Further decisions on the merger regime, potential new industry codes, and other changes will be announced over the coming weeks.
Commerce Commission Governance Review
Alongside the Commerce Act review, we’re also looking at the governance of the Commerce Commission.
This review, led by Dame Paula Rebstock, was focused on:
- The structure and composition of the Commission board
- Decision-making processes and transparency
- The skills and expertise needed to regulate increasingly complex markets.
The Commission is made up of very talented people, and I see some of you in the room today.
The goal is to ensure the Commission is well-equipped to deliver timely, high-quality decisions and maintain public confidence in its work.
We are considering the review’s recommendations and will announce Cabinet decisions in the coming weeks.
Banking
The Commission’s market study into personal banking services (launched in June 2023) found that the four major banks do not face strong competition, due to structural advantages, regulatory barriers, and low consumer switching.
The final report, released in August 2024, recommended:
- Strengthening Kiwibank as a competitive force
- Accelerating open banking, and
- Making it easier for consumers to switch banks.
The government has accepted all the recommendations, and my colleague Hon Nicola Willis has issued a new Financial Policy Remit to the Reserve Bank of New Zealand, directing it to place greater emphasis on promoting competition alongside its stability objectives.
In June 2024, a Select Committee inquiry into banking competition was announced, with broader terms of reference including business and rural banking. The Committee is expected to report back this month.
Open banking and consumer data right
In March, Parliament passed the Customer and Product Data Act, establishing the Consumer Data Right.
The framework will allow consumers to safely share their data with other providers, making switching easier and promoting innovation.
The Act also sets rules to make sure data is shared in standard formats, outlines who can receive the data, and includes safeguards to keep it secure and compatible across systems.
Banking is the first sector to be regulated, with rules coming into force by the end of 2025.
Over time, different sectors will be brought into the framework through regulations.
Retail payments
In July, the Commission released its final decision to further regulate interchange fees on Mastercard and Visa networks, aiming to reduce merchant service fees by $90 million annually.
This decision builds on the initial fee caps set back in 2022, which led to $140 million in annual savings for New Zealand businesses.
In late July, I announced the Government will ban surcharges on in-store EFTPOS and domestic Visa and Mastercard debit and credit payments by May 2026, and earlier if possible.
This responds to concerns that consumers are paying up to $150 million in surcharges annually, including up to $65 million in excessive surcharges.
The decision followed a detailed competition impact assessment, which weighed potential benefits and risks:
- Benefits include eliminating excessive surcharges, lowering compliance costs for merchants, improving enforcement, and enhancing the consumer experience.
- Risks include pressure on small businesses, potential price increases, and reduced incentives for consumers to adopt lower-cost or innovative payment methods.
The Retail Payment System (Ban on Surcharges) Amendment Bill will be introduced by the end of 2025, ensuring consumers know exactly what they’ll pay at the point of sale.
Water regulation
As part of the Local Water Done Well reforms, the Government is introducing a new regulatory regime under the Commerce Act to ensure water services are efficient, transparent, and accountable.
The Local Government (Water Services) Bill is expected to pass very shortly, and will appoint the Commerce Commission as the water services economic regulator.
The regime will initially apply to local government drinking water and wastewater services, with potential to include stormwater later.
The Commission’s tools will include:
- Information disclosure, to promote transparency about regulated suppliers’ performance.
- Maximum and minimum revenue thresholds, so that regulated suppliers have a clear understanding about the level of revenue they need to collect and invest in water infrastructure.
- The ability to impose requirements on regulated suppliers that give effect to the financial ring-fencing principle.
Together, these tools will lay the foundation for a water services system that is financially sustainable and delivers better outcomes for communities across New Zealand.
Broader view of competition policy
Competition policy is broader than just the Commerce Act. It intersects with consumer protection, sector-specific regulation, and innovation policy.
Making competition a priority means embedding it across government – not just in legislation, but in how we regulate, procure, and design markets.
For example, new Cabinet requirements for regulatory impact analysis explicitly reference the Commerce Commission’s Competition Assessment Guidelines to guide officials in developing regulatory proposals.
MBIE and the Commerce Commission play a key role in supporting this work, providing secondary advice that informs decisions across agencies and sectors.
Competition policy is also a function of trade policy, and a Government priority to deepen our relationship with key trading partners, including Australia and a single trans-Tasman economic market.
Closing remarks
Thank you again for your engagement and feedback – especially through the Commerce Act review process.
We’re committed to delivering reforms that are practical, enduring, and in the public interest.
I look forward to working with you as we move into the next phase of implementation.