The Ministry of Commerce review of the Commerce Act is timely but the length of time needed to prepare the report is frustrating, says TUANZ chief executive Grant Forsyth.
The review will look into whether the penalties against anti-competitive practices by companies are strong enough.
At the heart of the issue is the attitude that some companies have in viewing the maximum penalty under the act as $5 million. The problem with this figure is that some companies see the $5 million as the potential “cost of maintaining and operating an anti-competitive position”.
The process, expected to reach a conclusion in September, was initiated earlier this year in a discussion paper initiated by Commerce Minister John Luxton. It applies specifically to telecommunications and electricity distributors.
The ministry’s acting manager of companies and enterprise, Jeff Connor, says preliminary submissions need to be with the ministry by March 13. Connor is expecting submissions from lawyers, economists, businesses and consumer groups. People are also invited to indicate whether they want to be verbally consulted.
The process of analysis of the submissions then starts and a final report will be presented to the government in September. From there, the government has to decide what legislative path to follow, if any.
Forsyth says TUANZ has been producing reports on the subject since 1996.
“The process is not as swift as we would like it, so it is frustrating to those of us that recognise the need for change,” he says. “But it is pleasing that the government has finally recognised that, firstly, networked industries really haven’t worked very well and, secondly, that the current processes haven’t delivered the appropriate value to users’ interests.”