Companies that have market dominance in their field will be subject to a new competition test. Photo: RNZ / Alexander Robertson
New competition laws have come into force aimed at companies with substantial market power.
The new misuse of market power guidelines mean companies that have market dominance in their field will be subject to a competition test that considers the effect of their conduct.
Competition lawyer Andy Matthews of Matthews Law said the move aligned New Zealand's regulations with Australia.
He felt it was a positive change, but believed the competition test will be hard to prove and raised a potential issue.
"[When Australia underwent the change] there was a lot of concern there about the change and how large firms would know whether their behaviour was okay," Matthews said.
"What they've found is in practice it's not that big a change and it hasn't created that level of uncertainty."
But the old law provided a clear defence for large firms, he said.
"The problem with the [effects] test is if they could show a normal business rationale, then even if it was anti-competitive they could get away with it. So there is more uncertainty."
He said there would be greater arguments around the timing of effects.
Matthews said another big change was the removal of certain exceptions relating to intellectual property.
