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Commerce Commission COVID-19 response update

01 April 2020

Following the new Government policy statement, the Commerce Commission intends to take a more flexible approach to ensure competition law does not prevent legitimate collaboration, and a “pragmatic approach” to enforcement across all the laws it enforces.

What that means for affected businesses will become clear over the next couple of weeks as people take stock of what the lockdown means for their customers and their competition and consumer law and regulatory obligations. We give some examples below, and are interested to hear how competition and regulatory rules are affecting you at this time.

  • Facilitation by the Commission of collaborative arrangements between competitors where the Commission is satisfied this is necessary to maintain the supply of essential goods and services. The Commission has been clear that it will not tolerate people taking advantage of the situation to engage in unnecessary collusive or anti-competitive behaviour. This will require assessment of proposed conduct under the collaborative activities exception to the cartel prohibitions, and potentially Commerce Commission engagement.
  • On the regulatory side, the Commission has signalled “pragmatism” in the approach to enforcement. In practice, this invites early engagement with the Commission on how a supplier’s COVID-19 response may adversely impact regulatory compliance (e.g. with quality standards).
  • Extension of deadlines – for regulatory and compliance reporting, and for merger applications and investigation timelines. The Commission has already begun this process. The Commission will prioritise merger requests when the financial status of the firm is at risk because of the shutdown.
  • Potential enforcement focus on consumer protection and cartel conduct to target price gouging, confusing or misleading customers, and unnecessary collusive agreements. MBIE has set up an email address, pricewatch@mbie.govt.nz, where people can report increased prices and provide evidence.

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