Labour MP Dianne Yates, chair of the select committee which has reviewed the Films, Videos and Publications Act, says ISPs shouldn't be worried by any changes suggested as they're only recommendations.
However, one of the country's largest ISPs is voicing concerns.
Yates says the recommendations aren't definite plans.
"The general feeling of the committee was we didn't need to do it now but the Minister [of Justice] might like to look at it some time in the future if there was a problem."
The report suggests ISPs should either formulate their own code of conduct or have one forced upon them by government, however Yates is unclear as to what should be in any code of practice.
"Basically the whole issue is, what's coming into the country and what isn't, what can be monitored and what can't? What people are obliged to report? A lot of ISPs already have their own codes of practice."
Yates says she wants to see one standard code of practice across the board for every ISP.
"At the moment there's a voluntary buy-in to that one [the InternetNZ sponsored code of practice].
Yates says the committee has heard from a number of technical people as to what is and isn't possible in the form of filtering online content.
"The committee had extensive advice in particular on the whole internet process and technical advice and from the people who actually do possible security for parents and whatever."
The inquiry was asked to look at "all the possibilities" and report back to parliament and the Minister of Justice. The minister's office will take what it wants from the report and recommend either changing the existing legislation, introducing a new bill or keeping the legislation as it is.
Meanwhile, Ihug managing director Martin Wylie can understand the government wants to be seen doing something but since ISPs already cooperate with the Department of Internal Affairs (DIA) he asks why it needs to introduce a law enforcing that compliance.
One of the recommendations of the select committee is to license ISPs to enforce their compliance with any DIA investigation of objectionable material.
"If they turn up with a warrant, we're 110% cooperative. The issue is without warrants. That's what I'm nervous about - the arm twisting to cooperate. Once you're going into a licensing regime that gives them a lot of muscle in that context," says Wylie.
Wylie is unimpressed that ISPs may have to store records of all the traffic that passes over their networks.
"They seem to ignore the fact that there is no simple or straightforward solution to what they want. It's just a matter of the technology not lending itself to this kind of activity."
He also points to the privacy issues surrounding any such storage of traffic information.
"The origins of the net mean people assume they have privacy over this traffic and data. It's quite a cultural change to move to this kind of regime."
Wylie wonders whether the average New Zealander is ready for that kind of move.
"If they want to do that they need very explicit legislative authority. If the people of New Zealand want it that's one thing but to introduce it by stealth I think is quite another."
Xtra spokesperson Fiona Geary says Xtra is currently reviewing the report and can't comment until that is complete. She added that Xtra "understands and supports" the provisions of the InternetNZ Code of Practice with respect to objectionable material, but care has to be taken in any decision to obstruct access by adults.
Xtra's customers are provided with Cyber Patrol blocking software to protect children. This is bundled in with some plans and available at extra charge for others.
A commitment by ISPs to provide filtering software is one of the objectives seen by the select committee as desirable.
Cyber Patrol, like some other filters, has come under attack from civil liberties proponents for blocking access to inoffensive sites.
TelstraClear public affairs manager Mathew Bolland says Clear was one of the original signatories of the InternetNZ sponsored code of practice and TelstraClear remains committed to the idea of self-regulation wherever possible.