NEW ZEALAND Trends and Developments Contributed by: Briar Shaw, Julia MacGibbon, Kate Hatwell, Tina Liu, Jessica Phillips and Natalie Foster, Tompkins Wake
• Clarifying the merger test: the “substantial lessen - ing of competition” (SLC) test for mergers will be amended to include creating, strengthening or entrenching a substantial degree of market power in a market, bringing the New Zealand test into alignment with the Australian standard. A new principle-based merger clearance test using the same SLC threshold will also be introduced. • A new predatory pricing test: an objective, eco - nomic-based test for predatory pricing will be introduced. Pricing below average variable cost or average avoidable cost over a sustained period will be treated as predatory. Short-term promotional pricing, one-off specials and de minimis discounts are not captured unless they are part of a sustained pattern of below-cost behaviour. • Corrective action orders: courts will have the power to order corrective action where a person has breached anti-competitive conduct prohibitions. These orders can include making goods, services or information available for supply, or requiring businesses to act in a non-discriminatory manner. • Behavioural undertakings in mergers: the Com - merce Commission will be able to accept behav - ioural undertakings from merging parties as a condition of merger clearance, such as commit - ments to supply goods on certain terms or main - tain investment in specified areas. Previously, the Commission could only require divestiture, which meant some efficiency-enhancing mergers were blocked unnecessarily. • Collaborative activities notification: a new statu - tory notification regime will allow businesses to notify the Commission of proposed collaborative activities that might otherwise breach the cartel prohibition, and to proceed unless the Commission objects. Another amendment bill, the Commerce (Commerce Commission Reform) Amendment Bill, was introduced to Parliament in March 2026. It follows an independent review of the Commerce Commission and includes changes to the Commission’s structure, to separate its governance and decision-making functions, bring - ing the Commission in line with other Crown entities such as the Reserve Bank.
Beyond structural reform, the Commerce Commis - sion has signalled a sharpened enforcement focus. Unconscionable conduct is one of six Commission priorities for 2025/2026, defined as business activity which is a substantial departure from New Zealand’s generally accepted or expected standards of business conduct. There has so far been only one sentencing decision under this provision. However, businesses that have relied on their market position to impose one-sided terms on suppliers, customers or smaller business partners should review their commercial practices carefully. Looking Ahead New Zealand is a jurisdiction in motion. The reforms collectively represent a significant reshaping of the environment for doing business here. Some of these changes are already in force; others will take effect during the course of 2026. For offshore investors and businesses considering New Zealand, the overall direction of travel is encour - aging. The government has a clear intent to attract international capital and business talent, reduce regu - latory friction, and position the economy for growth after a difficult few years. For businesses already operating in this market, the immediate priority is to understand how these changes interact with existing structures, contracts, workforce arrangements and compliance programmes. The common thread running through each of these reforms is a desire to make New Zealand a more dynamic, competitive and internationally connected economy. Whether this strategy succeeds will depend not only on the quality of the legislation, but also on how businesses, advisers and investors respond to the opportunities these changes create. The window to engage and shape how these new regimes will bed in is now open.
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