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COMPARISON OF NEW ZEALAND AND AUSTRALIAN COMPETITION LAW
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Commerce Act
1986 |
Trade Practices Act 1974 |
| Contracts, arrangements, or understandings that substantially lessen competition |
Section 27. Very similar to the Australian provisions.
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Subsections 45(1)(b), (2)(a)(ii) and (2)(b)(ii).
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| Contracts, arrangements, or understandings containing exclusionary provisions (primary collective boycotts). |
Section 29. The provisions have a similar objective to Australia. The proposed amendments will address further problems with the targetting of the offence. |
Subsections 45(1)(a), (2)(a)(ii) and (2)(b) (i). The Australian provision does not include the NZ requirement that the target of the restriction or limitation also be a competitor, actual or potential, of the parties to the agreement. This has been identified as a problem.
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| Price fixing.; |
Section 30. Identical to Australian provisions in thrust and coverage. |
Subsection 45A(1). |
| Use of a dominant position. |
Section 36. Amendment will largely align with Australian provision. An exception is the option of adopting a reverse burden of proof for purpose. This option is not government policy, but rather put forward for comment and its workability will be considered when the Select Committee reports back to the House. |
Section 46. Persons with a substantial degree of power in a market are prohibited from taking advantage of that power for proscribed purposes. A further provision directs the court to infer purpose from relevant conduct and circumstances. |
| Access to essential services. |
No statutory provision. |
Part IIIA - establishes an access regime for essential facilities. |
| Mergers and business acquisitions. |
Section 47. Amendments will align with Australian provision. |
Section 50. Mergers and business acquisitions are prohibited if they would result in substantially lessening competition. |
| Declaration of price control. |
Part IV. Provides for the Minister to declare a good or service to be controlled and the Commerce Commission to regulate prices for those goods or services. |
No statutory provision. Price surveillance functions may be carried out by the ACCC under the Price Surveillance Act 1983. |
| Powers of the Competition Authority |
The Commerce Commission has similar powers to the ACCC in respect of restrictive trade practices. In respect of the reforms:
- The ACCC does not have a general power to issue cease and desist orders. However, it may issue competition notices under the Telecommunications Access Regime, which have similar effect.
- The ACCC is exempt from a requirement to give an undertaking as to damages when seeking an interim injunction.
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The ACCC has additional powers in respect of its functions under the access regime for essential facilities and its role under the Price Surveillance Act. |
| Sanctions imposed for breach |
The proposals will increase the penalties for offences. The sanctions will be slightly from those in Australia.
The maximum pecuniary penalty for body corporates will be:
- NZ$10 million; or
- Three times the value of any commercial gain or expected commercial gain, or
- If commercial gain is not known, 10% of the turnover of the body corporate and its interconnected bodies corporate (if any).
The maximum pecuniary penalty for individuals will be NZ$500,000.
The courts will be able to ban serious offenders from being involved in the management of a body corporate for a period up to 5 years.
Exemplary damages will also be payable.
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The maximum pecuniary penalty is:
- for body corporates is A$10 m per offence, and
- for individuals is A$500,000.
Exemplary damages are also payable.
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| Overseas shipping arrangements. |
Shipping is exempt from the Commerce Act and subject to a specific regime under the Shipping Act 1987. The Minister of Transport has responsibility for competition issues under this Act. |
Part X. Sets up a specific competition regime for shipping. |
| Telecommunications Access Regime. |
No statutory equivalent. |
Parts XIB and XIC set up a specific access regime for telecommunications. |
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