Commerce and Consumer Affairs Minister Andrew Bayly wants a stop to "creeping acquisitions". Photo: RNZ / REECE BAKER
The government is reviewing the Commerce Act and the Commerce Commission as it looks to combat monopolies and improve economic productivity.
The Ministry of Business, Innovation and Employment (MBIE) have already begun consultation on the review of the competition settings in the Commerce Act.
It will also review the governance and effectiveness of the Commerce Commission.
"Improving competition is one of the most important ways to boost productivity and lift living standards," said Commerce and Consumer Affairs Minister Andrew Bayly.
New Zealanders faced limited choice and high prices in a number of key sectors, Bayly said, from groceries to banking and building supplies.
"I'm sure many Kiwis remember with frustration the plasterboard crisis in 2022, which was an extreme example of competition failure."
The review will be completed by May 2025 and will be led by economist and former chair of the commission Dame Paula Rebstock.
Dame Paula Rebstock will lead the review. Photo: Supplied
She would be joined by law, economics and business Professor Allan Fels and economist David Hunt.
Improving competition to drive down the cost of living and increase productivity was one of the government's top priorities, Bayly said.
"This set of initiatives are about establishing a robust competition framework that will withstand the test of time for the benefit of all New Zealanders."
The review of the Commerce Act would in part focus on the merger settings. In particular 'creeping acquisitions', a series of small acquisitions which individually do not materially affect the market, but cumulatively reduce competition.
Cooperation between businesses would also be reviewed, with MBIE to consider whether price signalling - where businesses communicate or signal their pricing intentions, such as sharing price lists, with competitors - should be prohibited
MBIE would also consider whether a new code or rule-making power was needed to promote competition.
Meanwhile, the review of the Commerce Commission would look to ensure that the commission was meeting the needs of New Zealanders. A similar review is underway in Australia.
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