Commerce Commission committed to consultation

Media Release

12 March 2001/23

Commerce Commission committed to consultation on changes in responsibilities

Proposed changes to the Commerce Commission's responsibilities will impact across the economy. The Commission is committed to wide ranging consultation about how it will implement these changes.

Commission Chair John Belgrave made the comments today at the Utility Convention in Auckland.

Mr Belgrave said that the proposed amendments to the Commerce Act-including changes to rules surrounding business acquisitions, when price controls might be used, what would constitute misuse of a substantial degree of market power, penalty levels and what legal action would be possible against individuals-would have effects across the economy.

In addition, there will be effects throughout the economy from the Commission's new responsibilities in electricity and telecommunications.

"These are key industries that all modern economies rely on," Mr Belgrave said. "What happens in these industries impacts on the whole economy.

"We are already working with business and consumer groups to help them, and us, prepare for the changes, and we are committed to continuing consultation as the new legislation is finalised."

In telecommunications, the Commission has started a series of meetings with each of the major companies and consumer interrests. The purpose is to identify what each company sees as the major issues and concerns, focusing particularly on the change to a the new environment.

The Commission's electricity industry information gathering and consultation process, as part of its section 54 price control inquiry, began in October. Discussion papers on the key issues of price control methodologies and asset valuation methodologies will be published soon. The Commission's website, www.comcom.govt.nz, includes the details of the Commission's work with this industry.

Extensive information about the Commission's price control study of airfield activities at Auckland, Wellington and Christchurch Airports is also available from its website. The Commission expects to issue a critical issues paper this month after proposed changes to the price control provisions of the Comemrce Act are reported back to Parliament.

The Commission has published a discussion paper on the proposed changes to the business acquisitions regime, and will publish a draft of its revised Business Acquisitions Guidelines as soon as possible after amendments to the Act are made. The Guidelines explain the Commission's procedures, when parties should consider applying for clearance or authorisation and when the Commission will consider intervening in an acquisition.

"The amendments proposed for New Zealand's competition law are the biggest changes since the Act was passed in 1986," Mr Belgrave said. "The Commission will have to change its own processes to ensure that they are in line with the new law. We will work through our changes with business and consumer groups, and we aim to make the transition to the new regime as smooth as possible."

Copies of Mr Belgrave's speech are available from the Commission's website and in hard copy from reception at its Wellington office, Level 7 Landcrop House 101 Lambton Quay.

ENDS

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