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The Act addresses restrictive trade practices and business acquisitions; provides
for authorisations and clearances and allows for the imposition of price control
in various markets.
The Commerce Act 1986 is the primary piece of legislation in
New Zealand
governing competition law. Its principal goal is to promote competition in
New Zealand
markets by prohibiting certain business practices which are anti-competitive. The
Act addresses restrictive trade practices and business acquisitions; provides for
authorisations and clearances and allows for the imposition of price control in
various markets.
The regulatory body which administers the Act is the Commerce Commission. The
Commission has three principal functions – enforcement, decision-making and
investigation.
The five principal restrictive trade practices which the Act is aimed at are:
1. Contracts, arrangements or understandings which substantially lessen competition
2. Contracts, arrangements or understandings between competitors containing
exclusionary provisions (i.e. group or collective boycotts)
3. Price fixing
4. Misuse of a substantial degree of market power
5. Resale price maintenance
With regard to acquisitions of shares and assets (whether by purchase, merger
or otherwise) the Act prohibits such acquisitions if they have, or are likely to
have, the effect of “substantially lessening competition in a market”.
The Act is not intended to prevent you from being vigorously competitive or from
being taken over. It is not illegal for competitors to be hurt so long as the aim
is not to insulate a particular business against competition.
LESSONS
The three lessons guide you through your obligations and compliance under the
Commerce Act.
Lesson 1 > Introduction and Restrictive Trade Practices
Lesson 2 > Business Acquisitions
Lesson 3 > Enforcement and Remedies
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