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Business briefs

Commercial Law, Consumer Protection, Employment Law, Privacy Law, Regulatory Compliance, Trade & Investment
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Commerce Commission – unconscionable conduct

For the first time, the Commerce Commission has filed proceedings under the prohibition on unconscionable conduct in the Fair Trading Act 1986. This development suggests that active enforcement in this area is underway.

Unconscionable conduct is business behaviour that falls well below accepted New Zealand standards and goes beyond ordinary commercial practice to conduct that is clearly unfair and unreasonable. This is one of several areas the Commission has identified as an enforcement priority.

The Commission has taken action against Brand Developers Limited (trading as The TV Shop) and Tech Vault Enterprises Limited (trading as HouseSmile), alleging both used high-pressure sales tactics on vulnerable consumers, including people with cognitive impairments or serious illnesses. The Commission considers this conduct a clear departure from acceptable business standards.

Businesses found in breach of the prohibition risk a fine of up to $600,000 and individuals may be liable for a fine of up to $200,000. Courts may also order businesses to compensate affected customers.

This action serves as a timely reminder to all businesses to ensure their sales practices are up to scratch, especially when they are dealing with vulnerable customers.

 

Overseas Investment Act 2005 reform

The Overseas Investment (National Interest Test and Other Matters) Amendment Act came into force on 6 March 2026, delivering a significant overhaul of New Zealand’s foreign investment framework.

The reforms are designed to make it easier and faster for overseas investors to invest in New Zealand, while ensuring the government retains the ability to scrutinise transactions that could affect New Zealand’s national interests.

Part of the reform involved streamlining the overseas investment application process. Previously, overseas investment applications had to satisfy several separate tests. A single national interest test now applies to transactions involving significant business assets and sensitive land, other than farmland, fishing quota and residential land (for which the existing consent pathways remain). Applications are assessed through a three-stage process:

  1. Risk identification: The Overseas Investment Office (OIO) assesses the application for any national interest concerns. If none are identified, consent is granted. The statutory timeframe for decisions under this stage is up to 15 working days.
  2. Risk assessment: If concerns are identified, a more detailed assessment follows. Consent can still be granted at this stage, with or without conditions. The statutory timeframe for review under this stage increases by 55 working days.
  3. Ministerial decision: In cases where the transaction may be contrary to New Zealand’s national interest, the matter may be referred to the Minister of Finance who can decline consent. There is no fixed statutory timeframe for a ministerial decision.

For business owners looking to attract overseas investment or to sell to a foreign buyer, this framework should make the consent process faster and more straightforward. That said, the regime still applies and any agreement must be specifically conditional on OIO consent being obtained before the deal proceeds.

 

New obligations for businesses collecting personal information from third parties

On 1 May 2026, Information Privacy Principle 3A (IPP3A) came into effect, expanding the notification requirement under the Privacy Act 2020 to cover indirect collection of personal information.

Previously, businesses had no obligation to notify individuals when collecting their personal information from a third party. IPP3A has changed that.

What your business must disclose: From now on, when your business collects personal information indirectly, you must take reasonable steps, as soon as is reasonably practicable, to make the individual aware of the:

  • Fact that their information has been collected
  • Purpose of the collection
  • Intended recipients of the information
  • Name and address of the agency, or agencies, collecting and holding the information
  • If applicable, which law authorises or requires the collection, and
  • Rights of the individual to access and correct their information.

Exceptions: IPP3A does not require notification in all circumstances. Exceptions include, but are not limited to, where:

  • The individual has already been notified
  • The information is publicly available
  • Compliance is not reasonably practicable, and/or
  • It is necessary for law enforcement or court proceedings.

Please note the above is to be treated as a guide rather than an exhaustive list. We recommend seeking tailored legal advice before relying on any exception.

Next steps: If you haven’t already, you may want to consider building notification into your existing policies and this should be communicated clearly to individuals. The Office of the Privacy Commissioner has released guidance on IPP3A which provides a helpful starting point for understanding your obligations. Non-compliance may result in a complaint to the Privacy Commissioner, which may lead to a formal investigation and have potentially significant consequences for your business, so it is important you take steps now to ensure your processes are up to date.

For more detailed information about IPP3A together with examples of how it works, click here. If you have any questions about how IPP3A applies specifically to your organisation, please feel free to contact us.

 

Employment Relations Amendment Act 2026 – key changes

The Employment Relations Amendment Act 2026 came into force on 21 February 2026, introducing some significant changes to the New Zealand employment law framework. Some of the key changes of which businesses should be aware are listed below.

Independent contractors: The Act introduces a new gateway test to determine whether a worker is an employee or a contractor. To qualify as a ‘specified contractor,’ five criteria must be met that cover matters such as having a written agreement, freedom to work for others, flexible hours, the ability to decline work and having had a reasonable opportunity to seek legal advice. There is more information about the test here.

Personal grievances: Where an employee’s conduct amounts to serious misconduct and has contributed to the situation giving rise to the personal grievance, no remedies will be awarded. Where the conduct falls short of serious misconduct but still contributed to the grievance, remedies may be reduced by up to 100%.

High-income earner: Employees earning $200,000+ per year in total remuneration will no longer be able to bring a personal grievance or file proceedings in relation to an unjustified dismissal. A 12-month transitional protection applies to those already in roles when the legislation came into force.

Collective agreements: The requirement to apply collective agreement terms to new employees during their first 30 days, and the automatic sharing of new employee information with the union, will no longer apply.

Justification test: The section 103A justification test has been amended to take into account whether an employee obstructed the employer’s process. Significant procedural failures will no longer render a dismissal unjustifiable where the employee was not actually treated unfairly.

If you would like to discuss any aspect of how this new legislation affects your business, please don’t hesitate to contact us.

 

 

DISCLAIMER: All the information published in Commercial eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Commercial eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Content Copyright © NZ LAW Limited, 2026.    Editor: Adrienne Olsen.       E-mail: [email protected]      Ph: 029 286 3650

 

Health and Safety at Work Amendment Bill

Employment Law, Government & Policy, Health and Safety, Regulatory Compliance, Risk Management, Workplace Regulation
0

Expected to be enacted in the spring

The Health and Safety at Work Amendment Bill was introduced into Parliament on 8 February 2026 and passed its first reading on 12 February 2026. It is currently before the Education and Workforce Select Committee. Submissions closed at the end of March and the committee is scheduled to report back to Parliament by 12 June 2026. It is anticipated that the Bill will be passed before the election (early November).

If enacted, the Bill will represent the most significant reform of health and safety law in New Zealand since the Health and Safety at Work Act (HSWA) was passed in 2015.

 

Purpose of Bill

Workplace Relations and Safety Minister, the Hon Brooke van Velden, said that the Bill is intended to reduce compliance obligations, focus on preventing serious harm and clarify businesses’ obligations under the HSWA.[1] The key proposed changes in the Bill are:

  • Increased focus on preventing serious harm
  • Reducing compliance obligations for small businesses
  • Clarification of the health and safety obligations of landowners, and
  • Clarification of the relationship between health and safety legislation, and other legal requirements.

 

Introducing ‘critical risk’

The Bill introduces a new defined term of ‘critical risk.’ Small businesses must focus on avoiding critical risks. All other businesses must manage all risks but are required to ‘prioritise’ critical risks.

The Bill defines a ‘critical risk’ as a risk associated with one of the matters specified in Schedule 1A of the Bill; this lists a number of specific high-risk activities such as working with asbestos and other hazardous substances. A critical risk also includes any hazard that is likely to result in death, a notifiable injury or illness, a notifiable incident or an occupational disease listed in Schedule 2 of the Accident Compensation Act 2001.

Identifying what the critical risks are for a particular business is likely to be one of the more challenging aspects of the new legislation.

 

The impact on small to medium-sized businesses

The most significant change contained in the Bill is the narrowing of the duties of small to medium-sized businesses, referred to as ‘small PCBUs,’ to risks that are defined as critical risks under the Act.

This does not mean that small businesses have no obligations in relation to other risks. They are still required to provide adequate facilities to ensure the safety of their employees.

A small PCBU will be defined as a business with fewer than 20 employees. Businesses that have a fluctuating workforce will qualify provided that they have fewer than 20 employees for at least nine months of the year. This change is likely to have a significant impact on the compliance obligations of businesses in New Zealand, given that approximately 97% of businesses would qualify as a small PCBU.[1]

 

Obligations of landowners and recreational activities

Potential exposure to prosecution under health and safety legislation in New Zealand has long been a concern for landowners who wish to make their land available for recreational activities.

In the past, this has been a particular concern for rural landowners who have often avoided providing access to their land due to such concerns. It has also discouraged public landowners, such as schools and councils, from allowing their land to be used for recreational activities.

The potential liability of landowners was recently highlighted by the prosecution of the owner of Whakaari/White Island following the eruption in 2019, which resulted in the deaths of 22 people. The landowner was initially convicted in the District Court under the HSWA, despite not directly operating the tours to the island.[2] The High Court overturned this conviction on appeal.[3]

The passing of the Bill would mean that landowners would not generally owe health and safety obligations to people using their land for recreational activities.

 

The Health and Safety at Work Act and other legislation

The Bill would clarify the relationship between general health and safety legislation, and other legislation that applies to specific industries such as the aviation and maritime sectors.

In the past, there has been confusion as to whether or not businesses in industries covered by specific legislation have additional duties under the HSWA. The Bill clarifies that compliance with industry-specific legislation or approved industry codes of practice is also compliance with the HSWA, so there are no additional obligations.

The Bill also states that the owners of earthquake-prone buildings do not need to take additional steps under the HSWA, provided that they comply with the requirements of the Building Act 2004.

The Bill is intended to reduce the compliance work that is required by businesses under current health and safety legislation, which has become an expensive ’tick-box’ exercise for many. However, it will still be important for small businesses to identify the ‘critical risks’ in their businesses and to take steps to mitigate them.

If you have any concerns about the impact that this proposed legislation may have on your business, please don’t hesitate to contact us.

 

[1] New Zealand business demography statistics at February 2025, Statistics New Zealand.

[2] WorkSafe New Zealand v Whakaari Management Ltd [2023] NZDC 4149.

[3] Whakaari Management Ltd v WorkSafe New Zealand [2025] NZHC 288.

 

 

DISCLAIMER: All the information published in Commerical eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Commerical eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Content Copyright © NZ LAW Limited, 2026.    Editor: Adrienne Olsen.       E-mail: [email protected]      Ph: 029 286 3650

Budget 2026

Government & Policy, Infrastructure & Development, Public Sector, Social Welfare Law, Wealth & Retirement Planning
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Securing New Zealand’s future says the Minister of Finance

Despite pre-Budget announcements for the health, education and defence sectors, this Budget certainly contained some meaty content.

The government’s broader approach could therefore be characterised as a ‘meat and veg now, dessert later’ strategy to economic management.

With a net operating package of an average $2.146 billion pa ($8.272 billion over the next four years), the health sector is a major winner, followed by education (including tertiary), defence and intelligence, law and order, etc totaling new expenditure of $14.666 billion over the next four years.

On the other side of the coin, the Minister has anticipated savings of $6.394 billion over the next four years, making the net package of spending of $8.272 billion over the same period.

 

Health

  • A $5.5 billion increase in funding for frontline health services
  • Funding for three-day postnatal stays ($34 million) and $16 million allocated to specialist paediatric palliative care
  • Pharmac has additional funding ($54 million) to buy more medicines
  • $682 million for capital investment includes a new tower block for Whangārei Hospital, redevelopment at Palmerston North and Hawke’s Bay Regional Hospitals, and
  • Funding to lower the eligibility age for free bowel screening from 58 years to
  • 56 years; benefitting 200,000 Kiwis.

 

Education

The government’s aim is to lift student achievement in schools. The cancellation of the final year fees-free initiative will help fund preparing young people for trades and other vocational education. The main points are:

  • $131 million to help students meet standards for the three Rs (reading, writing and arithmetic)
  • Supporting the refreshed curriculum and new national qualifications implementation
  • Continuing the Healthy School Lunches Programme
  • Doubling the number of trades academy places providing free trades training for year 11-13 students, and
  • Around 230 new classrooms will be built, and there is a funding increase for school property maintenance and daily operations.

 

Defence and foreign affairs

  • Increased funding to retain current defence force staff levels, as well as increasing numbers in key areas
  • $110 million for international development cooperation, with particular focus on the Pacific, and
  • More funding to enable aircraft, ships (including keeping our two Anzac-class frigates ship-shape) and land forces to continue to operate.

 

Social housing and welfare

  • Increasing the accommodation supplement for people in private rentals, and increasing income-related rents for people in social housing
  • Funding for up to 2,250 additional social houses
  • More case management help to support solo parents into work, and
  • $45 million for extended community food support and children’s breakfast programmes.

 

Infrastructure

The government acknowledges that New Zealand’s current infrastructure must be not only be maintained, but also expanded through new investment.

  • The construction of the Cambridge to Piarere Expressway
  • Renewing and upgrading the rail network, particularly in Auckland and Wellington
  • Financial incentives to councils to encourage housing growth
  • Investment in hospitals, schools, courthouses, police stations and defence assets, and
  • Funding to drive the reforms to the resource management system.

These investments are in addition to previously approved current and pipeline projects.

 

Law and order

The government’s focus is to reduce crime and keep New Zealanders safe. Proposals include:

  • $503 million for frontline Corrections services
  • More support ($50 million) for frontline policing
  • Funding to reform the firearms safety system, and
  • $21 million for Customs to combat drug smuggling and transnational crime.

 

Fuel response

New Zealand is currently facing unprecedented pressure on its energy supplies resulting from the hostilities in the Middle East. The government will introduce:

  • A $50/week increase to the In-Work Tax Credit for up to a year to help working families with increased fuel costs
  • Funding for additional strategic fuel reserves to firm-up the country’s fuel resilience, if required
  • A temporary increase in mileage rates for support workers and people travelling for specialist treatment
  • Additional funding for Fire and Emergency, Corrections, Policy, Customs and Education to maintain frontline activities during this period, as well as
  • A $450 million contingency fund for future fuel-related costs.

Energy security is now top-of-mind in this current uncertain fuel climate. The government proposes:

  • Capital investment in Genesis Energy to accelerate the development of new generation and firming capacity, and
  • A new loan guarantee scheme to support businesses to transition away from the use of gas.

 

Public service

The proposed cuts to the public service have already been announced, and the reception has been mixed. The government wants to see improved productivity and greater efficiency to reprioritise frontline services while reducing the public service headcount.

 

Other initiatives include:

  • $200 million will be raised by a new tax on banks to help cover Reserve Bank costs
  • Rules will be changed to tax loans made by companies to shareholders that remain outstanding six months after the company is removed from the Companies Register
  • Stricter regulations for charities: a limit of $100,000 has been set for people claiming tax deductions for making charitable donations
  • More funding to control the dratted wilding pines
  • $184 million for Oranga Tamariki to protect and support children
  • Fringe Benefit Tax rules for private motor vehicles will be simplified
  • Making the SuperGold Card an official form of ID, and
  • Funding for new technology to improve our emergency management system.

 

NZ Superannuation

A vexed topic for any political party. Although not covered in the Budget, with the ballooning costs of National Super (projected to be $31.2 billion in 2030), all recent governments have grappled with future funding. Raising the age of entitlement, albeit slowly, and means testing are only two of the many measures proposed to alleviate the pressures on government funds. It is clear that the funding of NZ Super is a major issue and will need to be strongly addressed in the near future.

Overall the government hopes the Budget funding will lead to an increased GDP and a healthier economic environment.

To read the Budget in more detail, click here for the Minister’s Budget speech. The Treasury’s website, click here, is also very helpful.

If you would like to discuss more about the government’s proposals, please don’t hesitate to contact us.

 

DISCLAIMER: All the information published in Commercial eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Commercial eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Content Copyright © NZ LAW Limited, 2026.    Editor: Adrienne Olsen.       E-mail: [email protected]      Ph: 029 286 3650

Navigating redundancy

Employment Law, Human Resources, Regulatory Compliance, Risk Management, Workplace Regulation, Workplace Rights
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Understanding the legal process for employers

Redundancy refers to a situation where an employee’s position is deemed superfluous to an employer’s needs. Understandably, a redundancy proposal can bring stress and uncertainty to those affected. Unfortunately, it is a term that many New Zealanders may be familiar with.

We provide a summary of the required process, and obligations by you, as an employer, in proposing a potential redundancy in your organisation.

 

Lawful redundancy

For a redundancy to be lawful, it must be both justified and carried out through a fair process. A redundancy is justified only where there is a genuine commercial reason for it; redundancy cannot be used as a means to dismiss a poor performing employee or as an alternative to a disciplinary process for misconduct.

‘Genuine commercial reasons’ may include a downturn in work/revenue, declining financial performance, organisational restructuring, or the merger or acquisition of a business. Courts are increasingly applying scrutiny into the ‘commercial rationale’ for a redundancy.

However, even where a genuine reason exists, the dismissal will not be lawful unless the correct process is followed.

 

Process

The process that all employers must follow includes:
• Providing your employees with relevant information about the proposed change and the potential impact on their employment if the proposal is adopted
• Consultation with your employees and considering their feedback (and enabling your employees opportunities to seek advice or support within the consultation period)
• Considering alternatives to redundancy, and
• Following any additional procedural requirements specified in the relevant employment agreement or policy documents.

 

Providing information

The Employment Relations Act 2000 sets out that an employer who is proposing to make a decision that will, or is likely to, have an adverse effect on the continuation of employment of one or more of his or her employees, is required to provide the affected employees with access to relevant information about the decision.

The term ‘relevant information’ will depend on the specific circumstances. It includes, however, information necessary for employees to understand the rationale for the proposed change and to enable them to provide informed feedback. Your employee is entitled to ask for additional information relevant to your proposal. While an employer is not required to provide confidential information, they must be able to genuinely demonstrate that disclosure would cause actual, unreasonable prejudice, and must show that they have explored alternative options for confidential consultation.

 

Consultation

You are not only required to provide a potentially affected employee with all relevant information, but you must also ensure there is a genuine opportunity for your employee to comment on that information before any decision is made. This includes providing sufficient time to provide feedback.

You must approach this process with an open mind and genuinely consider any feedback received before deciding whether to proceed with the proposed change. Without genuine consultation, the redundancy may be deemed a pre-determined outcome, and a breach of your obligation as their employer to act in good faith.

 

Selection criteria

In circumstances where you are reducing a number of same/similar roles, a fair and reasonable selection process must be followed to decide which of your employees will be appointed to the remaining roles. Clear and relevant selection criteria should be provided to your employees in advance, and their feedback sought. This includes providing details as to how that criteria will be assessed and weighed.

 

Redeployment

If a role is disestablished, you have an obligation to consider redeployment opportunities within your organisation for any of your affected employees. The affected employee/s continuing employment must be considered before a new or vacant role is advertised externally. Redeployment must be considered for an affected employee, even if some (reasonable) training or upskilling may be required.

Your obligation to consider all redeployment options, stems from an employer’s statutory requirement of good faith – to be active and constructive in maintaining the employment relationship, including being responsive and communicative.

 

A challenging time

Proposed redundancy can be a challenging and uncertain time for all; but understanding the legal framework and the required process can help you to navigate this with more confidence.

It is also important to carefully review employment agreements and relevant workplace policies to carefully identify any relevant provisions, including any entitlement to redundancy compensation.

If your organisation is contemplating redundancies, we recommend you talk with us at the outset; this will help you and your employees better understand their rights and obligations.

 

 

DISCLAIMER: All the information published in Fineprint is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Fineprint may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2025.     Editor: Adrienne Olsen.       E-mail: [email protected]     Ph: 029 286 3650 

An agreement to lease and a deed of lease

Commercial Law, Leasing & Property, Property Law, Real Estate Transactions, Small Business Advice, Uncategorized
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How are they different?

An agreement to lease and a deed of lease are two similar, but different, documents. The Law Association of New Zealand (TLANZ), formerly the Auckland District Law Society, provides a ‘standard’ form of both an agreement to lease and a deed of lease. Most commercial leases use this ‘standard’ form of agreement to lease or deed of lease.

Agreement to lease

An agreement to lease sets out the main commercial terms of a lease, such as the term, annual rent and rights of renewal. It can also contain further details regarding the fitout and other alterations which the tenant intends to do to ensure the premises are suitable for its business use. It can also set out how the cost and ownership of the fitout and alterations will be met between landlords and tenants.

Agreements to lease can often be conditional agreements while the tenant works through a due diligence process to ensure the property is suitable for its intended use, or to ensure that it can obtain the necessary territorial authority consents to operate its business.

Once any conditions have been satisfied, the agreement to lease is a binding agreement between the landlord and tenant; it can only be cancelled in accordance with the terms of the agreement. An agreement to lease states that a tenant must enter into a deed of lease on the standard TLANZ form once prepared by the landlord.

Deed of lease

Like an agreement to lease, the deed of lease also sets out the main commercial terms of the lease, such as the term, annual rent and rights of renewal. It goes further than the agreement to lease; it allows a tenant to assign the lease and additional terms set out the position in relation to the day-to-day management of the lease, such as maintenance obligations for both the landlord and the tenant, and what happens at the end of the lease.

Why you should also enter into a deed of lease

An agreement to lease does not allow the tenant to assign its interest in the lease. However, a deed of lease does allow this. If a tenant wishes to sell its business, they will need to enter into a deed of lease to have the benefit of the assignment provisions in the deed of lease. If the tenant wants to obtain bank lending for its business, the lender may want to see the deed of lease, and may require that a deed of lease is entered into as part of its financing approval.

The agreement to lease provides that the parties will enter into a deed of lease on the ‘then current’ form of deed of lease.

Most importantly, the agreement to lease also incorporates all of the terms of the standard deed of lease, so the landlord and tenant are agreeing to be bound by a document they have not seen or signed. In particular, if the parties have not received legal advice before entering into the agreement to lease, they may not have full knowledge of the terms of the deed of lease and what they have agreed to, and may find that the obligations in the deed of lease are not as they expected.

We can help

While agreements to lease can be helpful, we recommend that you enter into a deed of lease shortly after the agreement to lease is unconditional and/or the lease has commenced. This will help ensure that all parties have a full understanding of the terms of the lease and all the benefits (and obligations) offered under the lease.

We can help in advising on the terms of the agreement to lease and the resulting deed of lease prior to execution. We can also assist with documenting the terms of an agreement to lease into a deed of lease.

 

DISCLAIMER: All the information published in Property Speaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Property Speaking may be reproduced with prior approval from the editor and credit given to the source.
Content Copyright © NZ LAW Limited, 2026.    Editor: Adrienne Olsen.       E-mail: [email protected]      Ph: 029 286 3650

 

New Zealand’s criminal cartel regime

Competition Law, Corporate & Commercial, Criminal Law, Public Procurement, Regulatory & Compliance
0

Lessons from the MaxBuild and Mardom prosecutions

While New Zealand’s criminal cartel regime has been in effect since 2021, it has only recently moved beyond theory into action.

The Commerce commission has now completed the country’s first criminal cartel prosecution with two sentences imposed in the High Court in Auckland on construction companies MaxBuild Limited (MaxBuild) and Mardom Limited (formally Chelsea Contracting Limited) (Mardom), with both companies pleading guilty to bid-rigging offences.

This enforcement marks a watershed moment for competition law in New Zealand, and sends a clear message to all businesses engaged in tendering, procurement and competitor interaction.

Criminal conduct

The prosecutions arose from alleged bid-rigging in relation to NZ Transport Agency’s Northern Corridor Improvement Project and Auckland Transport’s Middlemore Bridge Refurbishment Project; two publicly funded infrastructure projects.

The Commission’s investigation revealed that MaxBuild’s director, Munesh Kumar, colluded with Mardom’s director, Dominic Sutherland, by agreeing that Mardom would submit artificially high tenders (‘cover pricing’) to allow MaxBuild to win the contracts with lower bids. This practice undermines competitive tendering, harms procuring agencies and potentially loads costs onto taxpayers.

The scheme was accidentally uncovered when a spreadsheet containing details of the illicit arrangement was inadvertently included in tender documents sent to the project’s overseers. This triggered a formal Commission investigation and, ultimately, criminal charges.

Sentencing

In December 2024, the High Court sentenced MaxBuild’s director to six months’ community detention and 200 hours’ community service, and ordered a $500,000 fine on MaxBuild for its role in facilitating the cartel conduct. Justice Wilkinson-Smith described the behaviour as ‘serious and deliberate,’ and an attack on business confidence and taxpayer trust.

More recently, in October 2025, the High Court imposed a $30,000 fine on Mardom following its guilty plea to cartel conduct.

Justice Sally Fitzgerald indicated that a starting fine of $595,000 would have been appropriate for Mardom, but the fine was lowered to $30,000 due to Mardom’s poor financial position and lack of active trading. Despite not directly benefiting financially from the scheme, the company had ‘taken active steps in the collusive behaviour.’

In both prosecutions, mitigating factors such as early guilty pleas, cooperation, personal circumstances and the inability to pay influenced the level of penalties imposed.

Why this matters for New Zealand businesses

Under New Zealand law, intentional cartel behaviour – including price-fixing, market allocation, restricted output arrangements and bid-rigging – can attract:

  • Up to seven years’ imprisonment (for individuals), and /or fines of up to $500,000, and
  • Substantial corporate fines (up to the greater of $10 million, three times commercial gain or 10% of turnover for each year in which a breach occurred).

The cases of MaxBuild and Mardom demonstrate that:

  • The Commission will deploy criminal powers when warranted – not just civil penalties
  • Bid-rigging and cover pricing are key priorities, particularly in public-sector procurement
  • Individuals face personal exposure, with directors who engage in or facilitate cartel conduct risking criminal convictions and custodial sentences, and
  • Early guilty pleas and cooperation can reduce sentences, but they do not prevent convictions.

Lessons for business

  • Train your staff on ‘informal’ competitor contact. Conversations about pricing, bid strategy, territories or customers with competitors can be high-risk
  • Establish compliance programmes for your tender applications and keep them updated. Any coordinated arrangements with competitors about bidding practices can easily amount to cartel conduct. Include cartel law training, procurement protocols and escalation points for suspected breaches, and
  • Be proactive if you suspect there has been a breach. The commission’s Cartel Leniency and Immunity Policy (here) can be a way to mitigate exposure if cartel conduct is disclosed early.

Cartel conduct will be pursued aggressively

The commission’s prosecutions of MaxBuild and Mardom represent a tipping point in New Zealand’s competition law enforcement. It underlines that cartel conduct, particularly in tender processes involving public funds, will be pursed aggressively, with potential criminal consequences.

For businesses operating in competitive markets, strong competition law governance is essential to protect legal, financial and reputational risk.

 

If you are unsure about any aspect of competitive commercial tenders, please contact us at the earliest opportunity.

 

DISCLAIMER: All the information published in Commercial eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Commercial eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2026     Editor: Adrienne Olsen.       E-mail: [email protected]     Ph: 029 286 3650

Business briefs

Artificial Intelligence & Technology, Business & Investment, Consumer Rights, Immigration Law, Regulatory Compliance
0

Launch of the Business Investor Visa

The government has introduced the Business Investor Visa (BIV), a new immigration pathway aimed at attracting experienced international investors to strengthen New Zealand’s economy. The launch of the BIV follows the closure of the Entrepreneur Work Visa and represents a significant shift toward sustained investment in established New Zealand businesses.

The BIV offers two residency pathways:

  1. Work-to-residency (3 years) – minimum investment threshold of $1 million, or
  2. Fast-track residency (12 months) – minimum investment threshold of $2 million.

Investments must be directed into an existing, actively operated New Zealand business. Other key requirements include demonstrated business experience by the investor, investment in a business that employs at least five full-time staff, and compliance with approved and qualifying business categories.

For New Zealand business owners, the BIV presents an opportunity to attract new capital, expand operations and generate employment that, in turn, will promote long-term economic growth.

Responsible AI usage

AI is advancing and reshaping how businesses operate. However, if you adopt AI without a clear strategy it may expose your business to serious risk – including, without limitation, bias, errors, privacy breaches and cybersecurity threats.

To help businesses navigate this, the Ministry of business, innovation and Employment has released Responsible AI Guidance for Businesses, The Guidance outlines practical steps to ensure AI use is responsible and aligns with your commercial goals, legal obligations and ethical standards.

Key recommendations include:

  • Defining your purpose for using AI and starting with low-risk projects
  • Maintaining human oversight to prevent errors and unintended consequences
  • Reviewing governance, risk management and compliance processes
  • Choosing trusted AI providers and implementing strong data protection methods, and
  • Training staff to understand AI’s capabilities and limitations.

For a more comprehensive overview, we encourage you to read the Guidance and consider seeking legal advice to protect your business as you implement AI. While AI can deliver significant benefits, successful implementation requires a cautious and comprehensive approach.

HelloFresh and the Fair Trading Act 1986

In the Winter 2025 edition of Commercial eSpeaking, we reported on the Commerce Commission’s allegations against HelloFresh for misleading conduct under the Fair Trading Act 1986 (FTA).

The commission’s prosecution focused on an 18-month cold call campaign, during which former customers of HelloFresh were offered discount vouchers without a clear explanation that accepting those offers would result in subscriptions being reactivated, consequently triggering customer account charges.

Recently, in the Auckland District Court, it was found that the way the discount vouchers were presented created a misleading overall impression for former customers. HelloFresh was fined $845,000 as a result.

The above decision underscores the serious consequences of breaching the FTA. This is particularly relevant now, as the government has proposed to substantially increase the penalties for non-compliance. At present, the maximum penalties for misleading and deceptive conduct under the FTA are capped at $200,000 for individuals and $600,000 for businesses. The proposal to increase these limits will allow penalties to reach the greater of:

  • $1 million for individuals
  • $5 million for businesses
  • Three times the value of any commercial gain or loss avoided, or
  • The value of the transaction(s) involved.

Although a new civil regime will also apply for most breaches, the most serious or deliberate conduct will remain a criminal offence. These changes are expected to take effect by late 2026.

This announcement marks a significant increase in potential liability, emphasising the need for businesses to ensure advertising, pricing and promotional terms are accurate and transparent. Disclaimers buried in fine print may not be enough to correct misleading impressions. With penalties expected to become significantly higher, compliance with the FTA is essential to avoid financial and reputational consequences.

 

DISCLAIMER: All the information published in Commercial eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Commercial eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2026.     Editor: Adrienne Olsen.       E-mail: [email protected]       Ph: 029 286 3650

Moo-ving on

Agriculture & Farming, Business & Finance, Dairy Industry, Economic Impacts, International Investment, New Zealand Business News
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Fonterra hands the reins to Lactalis

In August, Fonterra announced that it had agreed to sell its major consumer brands. The sale will see Lactalis take ownership of iconic New Zealand brands such as Anchor and Mainland; it comes as part of Fonterra’s strategy to pursue an increased emphasis on its ingredients and foodservice businesses.

The deal brings obvious and substantial benefits to farmer-shareholders, but also raises questions about overseas investment into iconic Kiwi brands and the change of direction for New Zealand’s most profitable company.

 

The importance of Fonterra

Dairy, and the agricultural sector more generally, remains as New Zealand’s biggest export. With Fonterra’s importance within the dairy industry, the financial health of Fonterra is inextricably linked to the health of New Zealand’s economy.

Fonterra is the crown jewel of the New Zealand economy and, notably, dwarfs other Kiwi businesses in terms of revenue. Responsible for around 30% of global dairy exports, Fonterra reported NZ$26 billion in revenue for the 2025 financial year.

Due to Fonterra’s importance within the New Zealand economy, a deal of this magnitude was always sure to raise eyebrows.

 

A benefit to farmers

Farmer-shareholders voted overwhelmingly in favour of the deal, with 88.47% of voters supporting the sale – enticed no doubt by the prospect of a sizeable $2.00-per-share capital return and a stronger balance sheet.

After a decade marked by fluctuating payouts, rising costs and global market volatility, many farmers welcome the opportunity to extract value from a sector that has struggled to consistently deliver strong returns.

For many farmers, especially those carrying high debt or facing rising on-farm costs (feed, fertiliser, labour, compliance, etc), the return paid to shareholders from the Lactalis deal offers a rare opportunity to reduce borrowings, reinvest in their operation and/or strengthen cashflow.

 

Loss of identity?

Brands such as Anchor and Mainland are more than commercial assets – they are cultural signifiers woven into the fabric of New Zealand households. The sale of these brands to an offshore owner revives an old debate about the country’s willingness to let its most recognisable brands and assets slip beyond domestic control. For some, the sale is pragmatic. For others, it represents a quiet erosion of national sovereignty in the food sector.

 

Potential for vulnerability

Some commentators have pointed to the milk-supply agreement with Lactalis as a cause for concern. While the contract ensures continuity in the short term, it is a rolling three-year arrangement with a three-year notice period.

Industry observers worry that Lactalis, as a multinational with its own long-term strategy, may eventually choose to scale down supply from Fonterra or renegotiate terms. If that were to happen, farmers could face reduced demand for their milk and fewer avenues for profit. Fonterra’s once-integrated chain – from farm to brand to consumer – will now rely heavily on the decisions of a foreign entity whose priorities may not always align with New Zealand’s.

 

A change of direction

Strategically, the sale aligns with Fonterra’s long-stated ambition to focus on ingredients and foodservice, areas where its scale, milk-sourcing strength and global relationships provide a genuine competitive edge. Analysts have long observed that the consumer division, despite owning some of New Zealand’s most famous brands, tied up billions in capital while generating comparatively modest margins. From this perspective, the sale can be seen as a rational simplification – an attempt to double-down on the parts of the business that generate the highest and most stable returns.

The long-term implications are, however, far more complex. In shedding its consumer arm, Fonterra is effectively relinquishing brand ownership, one of the few buffers that insulated it from the cyclical brutality of the global dairy commodities market. Without the stable earnings and diversification provided by value-added consumer products, Fonterra becomes more exposed to commodity swings, geopolitical shifts and shifting global demand patterns – particularly in key markets such as China.

What is clear is that this transaction represents more than a balance-sheet manoeuvre. It is a redefinition of what Fonterra is, and what it aims to be.

 

DISCLAIMER: All the information published in Rural eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Rural eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2025.     Editor: Adrienne Olsen.       E-mail: [email protected]  Ph: 029 286 3650

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