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Recommendations


Review of the Clearance and Authorisation Provisions within the Commerce Act 1986

[ Last Updated 9 October 2008 ]


It is recommended that the Committee

1. note that the Commerce Act clearance and authorisation processes are generally working effectively and efficiently;

2. agree to amend the Commerce Act to:

  1. extend the statutory time frame for merger clearance determinations from 10 to 40 working days;
  2. repeal the requirement that parties must halt conduct while the Commerce Commission is considering an authorisation application for that conduct and ensure that the Commerce Commission is able to apply to the Court to seek an injunction to halt the conduct in appropriate circumstances;
  3. subject to agreement to (e) below, remove the right of an applicant and any third parties to require the Commerce Commission to call a conference;
  4. allow the Commerce Commission to call a conference at any point in its proceedings (and not just following the release of a draft determination);
  5. replace the current provisions granting standing to appeal for third parties against Commission determinations if they participated in a Commission conference, with the following:
    1. in relation to merger clearance determinations, third parties shall not have the ability to initiate an appeal but in the case of those who participated in the Commission's proceedings, will be able to join an appeal; and
    2. in relation to authorisation determinations, third parties shall have standing to appeal if the person participated in the Commission's proceedings in relation to the determination and they have a significant interest in the determinatinon (as determined by the High Court);

3. note that the outcomes of the Commerce Commission's review of its merger clearance processes, and its release of draft guidelines for consultation, will enhance the transparency and timeliness of its merger clearance process;

4. agree to no change in relation to the following matters:

  1. the Commission should retain discretion as to if and when it releases its written reasons for its clearance determinations;
  2. the Commission should not be invited to introduce an informal pre-merger process to operate alongside the statutory clearance regime;
  3. the Commission should not be able to accept behavioural undertakings in relation to applications to clear or authorise mergers;
  4. the "lessening competition" jurisdiction test in relation to trade practice authorisation applications; and
  5. the power for the Commission to revoke, amend or replace existing authorisations if there has been a material change in circumstances since the authorisation was granted;

5. note that the Commission is planning to review its authorisation systems, including consideration of a "streamlined" process for considering applications for authorisation of restrictive trade practices;

6. agree not to introduce;

  1. a trade practice clearance system;
  2. a collective bargaining notification regime;

7. note that the Commission's framework for assessing costs and benefits as part of the authorisation process is sound and in line with international best practice;

8. note that the proposed amendments outlined above are neither urgent nor significant;

9. agree to delay legislating until a suitable legislative vehicle is available; and

10. agree that the Cabinet papers on which the Commerce Commission (International Cooperation and Fees) Bill is based should be published on the Ministry of Economic Development's website.

Hon Lianne Dalziel
Minister of Commerce


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