Commerce Amendment Bill

When last we considered this bill—the National Party has the call.

Thank you very much, Madam Speaker. It’s a pleasure to take a call on the Commerce Amendment Bill. It’s one that I’ve not had a particular history with, so it’s with fresh eyes and great enthusiasm therefore that I get to join the debate at this, the third and final reading. In doing so, I’ve taken note of other comments that speakers before me have made at various stages of the bill, and acknowledge too the legislative statement that’s been put forward by the relevant Minister, who joins us in the House now. I acknowledge the work that he’s done, that others throughout the process have done, including the select committee, the EDSI, or the Economic Development, Science and Innovation Committee—the very well-known body that I’ve just had to remind myself of its name. Of course, it’s so well-known as to be referred to, usually, simply, by that acronym. Of course, they’ve done some serious work, some serious consideration, of the bill on the way through, and those comments have, largely, been reflected in the second reading, so I don’t intend to rehearse those, except, perhaps, to touch on them in passing.

But I did want to speak about the fact that there are four main areas in which the bill is going to bring change in the area of commerce, and, more specifically, the area of competition and anti-competition law. The way that it mostly does that is by, first, strengthening the Commerce Act’s prohibition against the misuse of market power; second, repealing safe harbours in the Act; third, by allowing a balance to be conducted between the public interest on the one hand and situations that would otherwise be considered contravention of the Part 2 of the main Act, or the Act as it currently exists; and then sort of various miscellaneous changes.

So, to go through each of those four areas in turn, the first, I think, is actually really interesting, because that’s clause 14, the section 36 prohibition against the misuse of market power. There’s a philosophical distinction, I suppose, oftentimes between the left and the right about the way that we ensure competition, the way that we seek to decide how it is that different players in a marketplace can perform to the maximum potential, because that’s good for them and, of course, that’s good for the consumer. That allows the market as a whole to function. But I think the good news is—and I do want to acknowledge it, because it seems that the bill is attracting bipartisan support. I do want to acknowledge that we have, at least in this matter, a fundamental starting point that is the same, which is to say that in a market such as the New Zealand economy, let’s say—roughly speaking, just to simplify grossly—that we do believe that allowing competition is a mechanism for ensuring the best outcomes overall. We assume—again, somewhat of a simplification, but—the consumer’s a rational beast and will make decisions in their best interests, and so the way to ensure that the best possible outcomes occur in an efficient manner is to allow the most possible options in front of that consumer.

So we let the market decide as best we can, but we do at the same time acknowledge that there are barriers to entry in the market. And so we don’t want to take an approach that’s completely laissez-faire, attractive as that may be to those of us on the right—for example, the ACT and National parties. But we would say that there are distortions in the fact that the market exists with barriers to entry, oftentimes, so we want to acknowledge those and we want to prohibit the misuse of market power in a way that would distort the market, reflecting some of the barriers to entry, as I’ve said. And so it is that the Commerce Commission will be able to publish detailed guidelines within the 12-month period following the passing of the Act, or, rather, it receiving its Royal assent. So with that period of time, there is the opportunity not only for those guidelines to be made but also for the relevant key players to make adjustments in their own thinking, their own behaviour, if needed, to avoid this misuse of market power in trans-Tasman markets.

The second point is the repeal of safe harbours. As someone who’s spent a bit of time in literal harbours, in a previous life I had before coming to this House, the idea of safe harbours is very attractive, superficially and in the literal sense. The idea of repealing safe harbours is worrisome to a former sailor. But, actually, of course, we’re talking in a figurative sense of areas in which those who might seek to exercise intellectual property rights could take refuge from scrutiny under competition law. So the bill is really, I think, taking quite a sophisticated approach. It’s a modern approach that says, actually, while it might be counterintuitive, we are enhancing and protecting the idea of competition by allowing those who own intellectual property to have rights to exercise in that space. And the reason that’s counterintuitive is because, of course, it would be possible to argue that if there are property rights and intellectual property that are held by one entity, that precludes others from joining in and using and developing those. But, of course, there’s incentives and the mechanisms that we want the market to employ, which is to say that there is profit, both in that economic sense but also, again, more generally, to be gained, to be obtained, by entities developing intellectual property. It’s a valuable thing. It’s worth investing in. It’s worth investing time, energy, and capital.

And so by preventing the erosion of those intellectual property rights, we’re actually saying that, overall, in time, society, the economy, the market, the community will be better off for that. Again, a 12-month transition period applies, according to the bill, and the select committee’s commentary and, indeed, the legislative statement, which I’ve already acknowledged, states that the reason for this is to allow those who will be affected by the repeal to come to agreement, to make adjustments that are necessary, and so forth. And it’s expected that the Commerce Commission, which is, of course, our public body that monitors such things—and, indeed, it does more than merely monitor; it actually actively intervenes at times—just at the risk of going into the next area that I wanted to talk to, the idea there is that they’ll be able to produce or amend existing guidelines so that interested parties can understand the effect of the repeals and adjust themselves accordingly.

The third, then, was to allow on an interim basis restrictive trade practices to take place, notwithstanding that they are restrictive. And the rationale for that is that the Commerce Commission is to be empowered to allow practices that would otherwise be prohibited to be allowed, if they assess it to be within the public interest. Now, there’s an application of judgment—I suppose to some extent it’s subjective, but one would hope that it would be exercised in a way that is reasonable. And so I suppose the Parliament is saying, really, to the Commerce Commission and all those who are affected by its exercise of power, that the principle involved is that if it’s in the public interest overall to allow, for a certain period of time, the application of or conduct that would otherwise be anti-competitive, then that would be allowed within terms defined and determined by the commission.

I understand that the commission has already published guidelines setting out its approach to these decisions—and that’s important—in a way that promotes at least some measure of accountability and allows some measure of certainty. So even though we might not be able to predict in any individual case with 100 percent certainty how the Commerce Commission would land, so to speak, on any given decision in the space, we can say at least that if we understand the factors in those guidelines as to how it would make those decisions, then there is a measure of predictability. And so the Commerce Commission has that power entrenched, they say, and confirmed and clarified. So I’ll state for the record, in this the third reading, that the National Party agrees with the bill overall, but also understands and acknowledges the purpose of that, at least as an interim power, where it is appropriate.

The final category of changes that are being made—there are a number of different ones within that, but one is, for example, allowing the authority, in black and white, for the Commerce Commission to exchange information with other Government agencies and regulators, including New Zealand Police. And the reason for that is, of course, we want them to be able to fulfil the duties and the functions that we as a Parliament and the executive Government and society expect and hope that it will fulfil. Of course, there’s always a question about privacy rights, so it seems that it’s appropriate that there are safeguards relating to the use and storage of that information. We hope that those will be taken seriously and that power exercised very carefully, because, of course, the privacy of information—it’s not only individuals but other entities who have the right to that privacy, and that right should be respected.

So, in conclusion, the National Party continues to support the legislation and congratulate those involved in its passage.

Thank you, Madam Speaker. In third readings, we tend to give thanks to many people who have helped us work on this bill, but can I just start my contribution by thanking the member who’s just resumed his seat, Chris Penk, for that really comprehensive review of this bill. And may I add, because we’ve got the Minister, thank you to the Hon David Clark. This is a wonderful piece of bill that really modernises the Commerce Act to what we need it to do in this modern-day history. Right now, in this day and in this context that we’ve given, we’re walking out of the economic effects of a post-pandemic era. We’re looking at competition. Our Commerce Commission has just come out in the recent month with a market study on our competition in our supermarkets and our grocery sector. We’ve looked at fuel prices, we’re going to look at building supplies.

Competition is in peril in our little country of New Zealand. Our economy is small, so that’s why we are very susceptible to anti-competitive behaviour. It’s really important that we choose as a Parliament to uphold competition in our economy to the best of our abilities. I do want to quote our capable chair, Jamie Strange, in, I think it must have been another bill that he contributed to, saying that competition breeds innovation. I think that is exactly why we are doing all of this—is that we need to make sure that we also have an innovative economy to be driving us forward in the 21st century. So that’s why I think it’s incredibly important that this bill addresses section 36, and that we make sure that in this commerce Act that we actually are able to give our courts the full power of not only constructing a scenario of hypothetical analysis but also we’re able to just look straight into the intention of these cartel behaviours and actually be able to give them the full suite of tools to prosecute, for those who are harming competition in different markets.

We’ve seen in Australia that they have also adopted similar frameworks in terms of how they judge and they rule in their competition law. I think it’s really important that we look at the benefit that it has brought on, including the effect that it’s had on their concrete market, from what I understand. So I think that’s really important in New Zealand that while we’re looking at things like the building supply industry we know competition law will lay the good foundation to ensure that we have a healthy market so that we can recover our economy from the pandemic as well. I’m also really pleased that we’ve been able to address the safe harbours in our intellectual property law as well, to make sure, as the chair has said, that we are looking to make sure that that sector is innovative so that we can bring technology to actually push on innovation in our economy as well.

Finally, my thanks goes to the Economic Development, Science and Innovation Committee. We’ve definitely had a very busy period with all of these laws coming in, but I also thank especially a member, Todd McClay, for working really constructively with us as the National spokesperson on this issue. I’m glad to hear that the other party is supporting this bill, and I think that we are really looking forward to seeing that this bill will breed better competition in our economy. So on that note, I commend this bill to the House.

Tēnā koe, Madam Speaker. I have lost count of how many sitting nights I’ve been waiting to give my speech on this bill, and so it’s a great pleasure to be able to give a brief contribution, noting that previous speakers have done a very lengthy and thorough running of what the bill actually contains. From a Green Party perspective, we really do want to encourage an Aotearoa where competition is fair. And, echoing the sentiments from our previous speaker regarding unfair competition, particularly in a duopoly of supermarkets, I think this bill is really timely so that the Commerce Commission feels far more empowered—particularly with the delay of this bill coming into effect, having the Commerce Commission empowered to give proper advice to people in the market, or who wish to enter the market, is deeply, deeply important.

My thanks also goes to the Economic Development, Science and Innovation Committee, to the people who have provided submissions on this bill, particularly those who have given feedback around intellectual property (IP) laws, as well as the people who have contributed to feedback on protecting Māori IP laws. We hope that this bill has some effect in ensuring fair competition in Aotearoa. I look forward to this bill coming into effect.

Competition is an amazing thing. As we’ve seen tonight with Air New Zealand, the charade has cost each member of the team of 5 million a thousand bucks each. It should be going into their hands, not the Minister of Finance. So I just wanted to expose the highs and lows of competition, and that this has been a gift from the Labour Party to the rich, at the expense of the working class. Well done to Labour. You can see why sometimes we get frustrated on this side of the House.

On 14 December 2021, the Economic Development, Science and Innovation Committee recommended this bill with certain amendments around the effects of competition and market power; intellectual property rights and leveraging, and safe haven aspects of those; and increasing the realities of anti-competitive mergers and cartel behaviour. For most of this part we’re not going to stand in the way of that as a bill. But we would like to point out that from an intellectual property rights point of view, it does have the potential to mirror some of the Credit Contracts and Consumer Finance Act problems that we’ve experienced—in the sense that we should be encouraging businesses to be innovative, to commercialise, to actually leverage the strength that they’ve thought about, through their teams, through their companies, and through their capital investment in making and bringing a product to the market. The impact of this is now likely to make owners reticent, sometimes even getting to the point where we may suffer in New Zealand in terms of product development, because they’ll think the size of our market isn’t worth it, isn’t worth the investment, and are we going to get challenged by the Commerce Commission, as somebody who wants to grow market share, or who has market share and actually wants to manage that.

So the merit of this bill is to increase competition, but it is also to take a look at one very simple aspect: does it grow the economy of New Zealand? At the moment, there’s only two cases that have come up where, sort of, the elements of this law have been applied. It makes me think that the Commerce Commission, in its empire-building status, would like to create more case law, which, obviously, the lawyers will love, to actually justify this. But I’m predicting now that in the area of intellectual property rights, we will have competition issues where lots of challenges and money will be expended in an unregulated market.

We are all for competition and minimum regulation, in the ACT Party. But we also respect the philosophy of the bill, which is behavioural, in terms of making sure that the competitive playing-field is standard size between Australia and New Zealand. It is likely to follow that the Australian benchmark has application here. But also other applications could be received from the United Kingdom and other various countries. So the majority of coverage on the bill has focused on the market powers section, and there is a fine balance here between market power, competition law, and intellectual property rights. If people, companies, and organisations, especially in the era of new technology, are afraid to innovate in this country because of a Government department, then we have a serious a problem.

So we’ve been asking to reinstate the safe harbour intellectual property (IP) section and give business confidence that they can invest in their IP, and license their IP. If you take an example in the horticultural industry, you could have packaging equipment that would work for avocados, it could work for apples, but they are two different markets, and you can’t get transfer knowledge or IP. So with regards to the Minister’s bill, there will be an impact we feel—

ASSISTANT SPEAKER (Hon Jacqui Dean): Order! Order! With apologies to the member, could the members on my left, if they’re going to have a conversation, could it not be for the benefit of the House. So just if you could keep your voices down it would be appreciated.

DAMIEN SMITH: Thank you very much. The point we make is that competition and intellectual property right leverage is a mixed area, and we do not have the confidence that this has been fully thought through, that there’s enough case law yet. So we would recommend that the Government takes a view on reviewing this bill as that case law comes through.

So ACT will be supporting this bill, but we wanted to point out the inherent weaknesses around intellectual property right leverage, and that some of the Supplementary Order Papers did cover this off and should have been passed to add value to this bill.

Thank you very much.

Kia ora, Madam Speaker. Thank you for letting me, as others have said, finally take a call on the third reading of the Commerce Amendment Bill. As a member of the Economic Development, Science and Innovation Committee, we have been busy but probably not as busy as our Minister, actually, and I would acknowledge the Hon David Clark, our Minister of Commerce and Consumer Affairs. I mean, this is another bill yet again tonight that you are, you know, pushing through the House at great speed and doing a lot of work. So we acknowledge you, Minister, for your hard mahi ensuring that New Zealand is a fairer place, ensuring that we are set up.

Obviously, as has been said, we are a very small nation. I often talk to people about us very much being a large, narrow, spread-out city of 5 million people. And because of our remoteness, because of the way we live and operate down here in our remote economy, we can be susceptible to the concentration of market powers. So it’s important for us as a small nation to have effective protections against firms with substantial market powers who may be able to engage in anti-competitive conduct. So this piece of legislation very much is around protecting consumers.

But I think, as actually my colleague Naisi Chen said and as the chair of our select committee, Jamie Strange, said, competition breeds innovation. I really think that’s true and this piece of legislation, hopefully, helps with that innovation. Because competition between firms can be intense, it can also lead to some losing out. But in all of that, it delivers better products, it delivers better innovation, and it often delivers lower prices for our consumers. This competition law that we talk about is not about protecting individual businesses as such but it’s about protecting competition as a whole. For us here in the bottom of the world, protecting competition is important to us and that’s why we’ve worked hard with our colleagues across the floor to get this piece of legislation to where it is today and to pass it tonight.

Competition law very much aims at promoting and at protecting the competitive process. Again, it’s not about individual competitors. It’s about protecting the process. So tonight I want to again come back and thank a few people: the advisers and the officials who steered us, who supported us, who answered all of our curly questions; our select committee, and as I’ve felt we’ve worked really well together to get to this place tonight, our competent and on to it chairperson, Jamie Strange. Thank you for holding us together and bringing us along the way. I also want to acknowledge the Hon Kris Faafoi, who was in this role in a previous Government and began this process and again acknowledge the Hon David Clark for bringing good legislation to this House—good legislation that works for competition in New Zealand, that works for innovation, and that works to ensure that those of us consumers get a fair deal and a fair go. I commend this bill to the House.

The Hon David Bennett—a five-minute call.

Thank you, Madam Speaker. I appreciate the chance to talk on this bill, the Commerce Amendment Bill, third reading. Although I’m not a member of the committee of the House that discussed it, National does support this bill. We see that there are some parts of the legislation that are important.

Proposed new section 36, “Misuse of market power” moves away from the intention test to a purposed effect or likely effect of substantially lessening competition. That is something that is a change in our law and probably under that clause isn’t so much of an issue, but when it comes to the actual effects test, the National Party has some concerns around the nature of that test and how it will actually work out in practice for companies that may then be subject to that test.

The Ministry of Business, Innovation and Employment’s regulatory impact assessment supports the National Party’s view, stating that there is a genuine risk that some businesses may act overly conservatively and compliance-focused to avoid any risk of contravening the amended section 36—“This would impose some costs, and could lead to some firms not engaging in conduct that is ultimately pro-competitive.”

Effectively, the risk is that this achieves the ultimate difference in purpose from what the bill is actually there for, which is to enable competition. It would actually potentially mean that businesses take an overly conservative view and potentially could be liable for any unforeseen reduction in competition.

That’s where one of the key fundamental parts of our law is enshrined, in most legislation—is an intention test. There needs to be an intention to commit an offence. I’m going back to the legal system days, and I’m sure Mr Chris Penk will understand this very well—the mens rea of intention. I can’t actually believe I can remember that, those days, but even a non-lawyer myself that did study it—[Interruption] Yes. Remember the lectures on mens rea and how important that is, especially in the criminal justice system. Here we are moving away from that to any unforeseen reduction in competition as being sufficient.

So when we have the words “purposed effect” or “likely effect”, and it’s now “purpose” or “likely effect”, that actually then creates—well, that should be the change in the amendment that the National Party is looking for, which would actually give a little bit more comfort to those businesses that could potentially be in the position where, without any intention, they are ultimately responsible for unforeseen consequences.

Although the bill is generally in the right intention, you could say, the actual nature of the test that is being used could actually lead to a situation where some businesses are not in a position that they would have endeavoured to have themselves in. We understand that some companies have written to the Minister to that effect, and there hasn’t been that response from the Minister to be aware and change this law to make it more satisfactory for those that are in business.

We will support this legislation but we have some concerns around it, especially around those unforeseen circumstances and possible options that it could create for business, and we would encourage—it’s a bit late now, in this reading, for the Minister to make those changes, but it’s important that the Minister looks at how this law is actually implemented through the various mechanisms that he has or she has to make sure that we actually get to a situation where it is not an unjust law that’s being passed through this House. So we look forward to the Minister actually implementing this law in an appropriate way through the relevant departments rather than in a very strict way, which potentially could happen, too, under this legislation as it stands at this time.

I call Ingrid Leary—five minutes.

This is a great piece of legislation because it’s consumers who will benefit. So it’s another really good law that’s been brought to the House by my good friend and colleague the Hon Dr David Clark, who—like me—represents the best part of New Zealand: Dunedin. And I wanted to commend him for having the best interests of consumers at heart. He has brought in a suite of laws that really look at relevelling the playing field and making sure it’s as competitive as it can be. Last year, it was an amendment to the Fair Trading Act; we’ve had the recent review into consumer credit laws, and I believe that there are some more likely to come; there’s been the review into the supermarket duopoly—I’m looking forward to his responses to that; and now we have this Commerce Amendment Bill, which is about protecting consumers.

And to get a bit geeky on it, I just want to sort of do a little forensic on section 36 in clause 14, because it’s such an interesting part of this bill. Section 36 is basically New Zealand’s anti-monopolisation provision, and it has four elements which need to be established. First, one needs a relevant market. Secondly, there must be substantial market power in that relevant market. The firm in question must have taken advantage of that substantial power. And fourthly is around motivation, or acting with one of the prescribed purposes—and over on the other side of the House, they referred to it as mens rea, although that’s actually more attributable to the criminal legal system.

What’s been interesting with this is that there’s been a hypothetical test rather than an actual test, and the question becomes whether the defendant has engaged in a particular activity in a hypothetical market—which is a really difficult question. The problem is that it fails to capture categories of conduct which deserve condemnation. An example might be where an importer of a particular product prevents other importers of that product from, say, having access to the ports. So one can see the disadvantage they’d be placed at, and yet the way that section 36 stands, it currently would not capture that anti-competitive behaviour. So what this amendment does is it introduces the effects test, and it makes it an exercise about looking at actual intention and an actual market—which, to my mind, is a much more sensible way to proceed when looking at competition law.

The arguments levelled by Damien Smith and David Bennett about unintended consequences and being anti-competitive don’t really stand, because—as Glen Bennett said tonight, my colleague—this law is not about protecting individual businesses. It’s not going to stifle competition by deterring firms with market power from lowering their prices or innovating. Competition law is aimed at protecting the competitive process, not individual competitors. So it’s all about becoming more efficient, introducing better products, lowering prices—and they are all legitimate and pro-competitive practices.

I would note that Australia has already introduced a similar law. And given the proximity of our markets, and the way that our markets operate sometimes as, effectively, one market, it just makes sense to align our legislation with the Australian legislation so that we don’t need to rely on the courts to reach the same conclusion—which is much more expensive and onerous for everybody.

The other thing, I guess, is just noting that the New Zealand market is made of mainly small and medium businesses. In that environment, small firms arguably do need more protections. Therefore, it stands to reason that we would see a section 36 change like this to afford that extra protection from market dominance by the big players.

So it’s great to see the enthusiasm from across the way. I think we’ve dispelled the notion that there are risks to anti-competitive behaviour, because clearly this is about the process of competition not individual companies and the impact it would have on individual companies. It sends the right signals to the market, and I’m really proud that it has reached the third reading, and I look forward to the next piece of legislation that my good friend the Hon Dr David Clark might have to make sure that consumers are getting the best deal that they can. I commend it to the House.

Thank you, Madam Speaker. Tonight, there’ll be many people sitting at home around New Zealand who will be very worried about getting ripped off. They’ll be worried about losing their hard-won money. A lot of their concerns will be focused on what’s going on out on the street, what’s going on downtown, because that’s what they hear and that’s what they’ll be watching on telly. But, actually, they’ve got more chance of actually losing their money or being dissuaded or persuaded out of their money by what happens during the day, during their interactions in business, etc.

What sort of things are we talking about? One thing in the debate tonight, I think there’s a general agreement that we’ve got to do something. But these are the type of things that do happen, that do mean that well-meaning people, honest people, hard-working people that we’re all trying to define here in the House at the moment, over with various other things, are parted from their money. Things like consumers being sold insurance policies that they are ineligible to claim on. Now, who hasn’t been to buy a new product, who hasn’t been to a bank, who hasn’t been to an institution where the person who they’re dealing with is incentivised to actually sell them another product, a value added, where that person’s remuneration is quite dependent on them selling? So they sound good, they look good, and it’s only later on when they come to claim that they realise they’re actually not eligible. Sales incentives leading to customers being sold products they don’t need or that don’t suit them. Again, quite an advantage on behalf of the seller. Not bad people, not criminals in any way, but just people who, in order to make sure they make a living, have got a highly contestable part of their income in actually ensuring that they can get customers to part with their money for products they clearly don’t need.

Or life insurance companies: being churned from one policy or provider to another, which again can result in the loss of cover. The old days of the door-to-door insurance salesmen are relatively a thing of the past. But, of course, with the advent of these machines—to those that are listening at home, I refer to the cellphones and social media—we are metaphorically being door knocked every day for these products.

Also, and this is probably one where I think this will be welcomed by the industry: poor accountability at senior management and governance level for conduct. Anyone who’s sat on a board will know that if you’re on a board, a commercial board, your job is to look after the share price, your job is to ensure that you give a return to the shareholders. Well, of course, if that’s the only thing that was governing you—and we’ve seen a lot of that; we saw that particularly in 1987, we saw it in 2008, we generally see it whenever there’s a downturn. People get away with a lot when the market is climbing upwards; it’s only when there’s a downturn, if the swamp drains and the stumps are left exposed—or the monsters, some might say, are left exposed—that we actually understand what has happened. So this actually gives a protection. If you are board member—which, of course 95 percent of our people sitting around boards are decent people trying to do the right thing; legislation like this, or guidelines, if you like, ensures that those people are not going to be dragged down by a rapacious adviser, maybe even a CEO, whose own salary might be dependent on taking a certain course of action. So this gives the protection that these organisations need.

New Zealand—it’s no accident that we do measure very highly on all international surveys on honesty, on integrity, and on corruption. These things don’t come by accident. Actually, I don’t always stand and disagree with my colleagues here, but I think we need to be very careful when we do compare ourselves with Australia. They might look like us, they might sound like us, but anyone who’s sat on boards or done a lot of business with the Australians would know they’re quite different from us. And even though the behaviour that was exposed during the Australian royal commission was at a level that we would like to think we don’t see here, there’s certainly been hints of it over here. So that’s why legislation like this is very good. So I would caution those that would start to compare ourselves too closely with Australia, and just know that they can be quite different people governed by different cultures and different rules, and, of course, they are different states very much.

So this is, I think a very good piece of legislation. I think the people who will welcome this are the very, very large numbers of good, honest people on boards, who are working in the institutions that this will refer to, who now know that they won’t be punished, they won’t be disadvantaged for keeping to the rules, because those cowboy players out there who may not have been quite as, shall we say, honest as they were or as determined to keep to the rules as they were, won’t get the commercial advantage. So I commend this bill to the House.

Thank you, Madam Speaker. This is legislation that the National Party has decided to support. We decided that proposed new section 36 Misuse of market power was important, in particular, in relation to changing or amending the provisions around taking advantage of that power for an anti-competitive purpose.

Let’s be real about this. Supermarkets have been doing this stuff for years, and this Government actually hasn’t done anything about it, and nor did ours, but what we didn’t do was shut down small businesses during the COVID lockdowns and force everybody to go and use the two big supermarket chains, which is what happened. And so the very people who are now saying, “Oh, we’re going to do something about it.” I’m sorry, you didn’t save the small butchers, you didn’t save the small grocers, what you did do is you helped the big supermarkets—

Helen White: You would have left it all open, would you? Is that what would have happened?

Hon JUDITH COLLINS: —become even less competitive. And yes we would have fixed it because we’re not a bunch of incompetents when it comes to business.

Helen White: And people would have died—a lot more people would have died.

Hon JUDITH COLLINS: When I look at the Commerce Act—I have no idea who that person is speaking through the mask because I can’t see who it is. But what I know is that the Commerce Act—I was actually practising law when the Commerce Act was brought in. It’s not that old, you see.

Hon Dr David Clark: 1986—not so long ago.

Hon JUDITH COLLINS: Exactly, 1986, and I did a paper for my air and space subject for my masters in this, and I did it on what the Commerce Act was going to do to the airline industry, and it was absolutely right, which was it was going to increase competition in a market that had been absolutely devoid of competition. You might have noticed more competition brings prices down, better customer service, brings people to understand that the customer is right, not the business itself. And that is why we do need to change some of this behaviour.

But we also see this behaviour happening in the Resource Management Act in terms of the behaviour of supermarkets and others—the big giants who object to some competition anywhere near them. What other industry gets away with this—what other industry? And the answer is there isn’t any. This is a piece of legislation that is needed, but do not think for a moment that it is going to solve all these issues.

We need a competitive nature in this country. We’re sitting around as a country competing against ourselves when we should be competing against the world. And there are only a few industries where we really do compete against the world. Even then we become complacent. Even then we think that market’s always going to be there. Even then we don’t understand that we are paying in New Zealand far more than what people are paying in, for instance, Australia.

I read just recently about a woman who went online and she had Amazon deliver her groceries to her at less than what they are in New Zealand to go down to the supermarket. And that’s the next thing that I’m going to try, because, frankly, if that can happen, then it’s simply not good enough to continue to rark up the prices. And I understand, the minimum wage has gone up, all of this affects the profitability of the supermarkets. All this affects the profitability of every business, but I’m fully aware too that we shouldn’t be taking ourselves as fools on this. It is simply not good enough.

And this Government is now saying, well, they’re going to do something about it finally. We started off the process of it; they’ve finally decided to do something. We’re happy to support them to do it, but let’s not kid ourselves. This is not going to be the game changer we think it’s going to be. The Commerce Commission is under-resourced, it is not high powered enough to take on some of this work, and we do need to actually sit back and say, “Why are we continuously going down this path of enabling big players to take out the smaller players in the market to take away all the competition that there is?” And we turn around and say, “Oh, well, this is going to fix it.”

It ain’t going to fix it until the Government stops doing things like shutting down small businesses. Treating the local butcher—and I’m thinking about the butcher that we use. Treating that local butcher during that Auckland lockdown as though he is the problem, and yet you can go along to the Australian-owned supermarket and go in and buy their meat. Now, what was wrong? What was going on there? And the answer is big Government thought it knew how to deal with this because it had no wish to deal with small players, it had no wish to treat those people as though they are responsible people. They have to already follow hygiene procedures, they are all licenced, they have to do all these things well, and yet the big Government just like talking to the big business, because they can shut out the little people—didn’t have to deal with them, didn’t care about them. That’s why small businesses are saying they’re never going to vote Labour again.

Madam Speaker, thank you for the opportunity to take the last call on the Commerce Amendment Bill. It is a real privilege as the Minister in charge of the bill to have the opportunity to take the final speech in a third reading. It’s normally the case that the Minister in charge of the bill takes the first speech in the final reading, and unfortunately, due to IT issues with some of our systems here and some challenges I was experiencing from my home base, I was dependent on the Minister, Andrew Little, reading from the material I had prepared to take that speech. I do want to put on record my thanks to him, and I do also want to also acknowledge that the hybrid House system has worked incredibly well through this challenging time. It’s good, though, to be back in the House, as I was discussing with my colleague the Hon Dr Megan Woods just a moment or two earlier.

I do want to acknowledge around the House the support for this bill and the constructive speeches that have been made through this stage. I know along the way there has been some disagreements about parts of the bill and some Supplementary Order Papers put forward by other parties around the House. But actually, people have swung in behind the bill in the final stage, recognising that it’s important to have a consensus around these things, and recognising that ultimately this is good law and good change and important to update our competition law.

I do feel passionate about competition law. I don’t mind admitting that to those assembled here today. I want to acknowledge the Economic Development, Science and Innovation Committee, under Jamie Strange’s leadership, that’s brought this through. I want to just speak a little about the section 36 change, which is, I think, the big, important change—the most important change—we’re making here. Section 1A of the Commerce Act 1986 says that “The purpose of this Act is to promote competition in markets for the long-term benefit of consumers within New Zealand.” It’s very plain. It’s focused on the actual state of competition in the market. It’s not a theoretical state; it’s the actual state and the actual benefit for consumers. Up until now, unfortunately, although section 36 was intended to strengthen the prohibition against anti-competitive unilateral conduct—as we heard from the Hon Judith Collins, when it was introduced in 1986 it was supposed to prevent firms with substantial market power from harmful competition—it’s been clear for a long time that it simply has failed to live up to that. There have been five cases taken by the Commerce Commission since 1986, and only two of them have been successful. I think the very fact that they haven’t trusted themselves to take more than five cases since 1986 speaks volumes in and of itself.

I, in Opposition, actually worked with some competition lawyers to begin the drafting on a member’s bill to change section 36 of the Act. It went into one of my colleagues names, ultimately—the Hon Clayton Cosgrove—and became a bill in his name which never, I don’t think, got drawn from the biscuit tin, from memory, or if it did, it got voted down at the time. But it’s an issue that I have been passionate about for some time because we’ve seen in other jurisdictions, and particularly across in Australia, stronger tests that have ensured better competition in their markets and therefore better outcomes for consumers. So that is part of the reason why, for me, it’s such a pleasure to see this go through the House, to make sure that we are improving and promoting competition in our markets for the long-term benefit of consumers right here in New Zealand.

I do want to make it clear that the bill doesn’t penalise dominant firms for out-competing their rivals through superior practices, better offerings, or efficiency in the market. That is not the intention, and the test will be high here still. But it is a bill designed to improve competition. I don’t want to prolong the debate, but I do want to thank members around the House for the vigorous debate through the various stages and the committee stage. It is important to debate these ideas. I want to thank them, though, also for their support as the bill passes through, and celebrate that this important piece of legislation will now pass into law. Thank you, Madam Speaker.

Motion agreed to.

Bill read a third time.