The Regulator Report lists recent changes, decisions and developments at the main New Zealand and Australian corporate, commercial and competition regulatory bodies and updates progress of legislation in New Zealand. This edition of the Regulator Report covers the period from 21 November to 15 December 2009.

As this is our last issue for the year, we would like to take this opportunity to wish you all the very best for the holiday season and the New Year. Regulator Report will be back at the end of January 2010.

The Treasury

New Zealand's position under the Kyoto Protocol
The Treasury publishes regular updates of the quantum, carbon price and exchange rate data used to calculate New Zealand's position under the Kyoto Protocol reported in the Financial Statements of the Government of New Zealand. The estimate of New Zealand's position at 31 October 2009 is a $NZ184 million net asset.
Click here for further details

The Reserve Bank of New Zealand

Reserve Bank and NZX in talks
The Reserve Bank of New Zealand and NZX are engaged in discussions on a potential joint venture to provide clearing and settlement services in New Zealand. This follows on from the passage of the Settlement Systems, Futures, and Emissions Units Bill (which was enacted as the Reserve Bank of New Zealand Amendment Act 2009, Securities Markets Amendment Act 2009, Personal Property Securities Amendment Act 2009, and the Securities Amendment Act 2009). This new legislation provides for the designation of systems that clear and settle products, not just payments. NZX announced earlier in the year that it intended to launch a new Central Counter Party clearing and settlement system under the new legislation. At present, New Zealand has two settlement systems: Austraclear New Zealand, run by the Reserve Bank, and NZX's FASTER system. As a first step the Reserve Bank and NZX will undertake a review to determine the feasibility of jointly providing the clearing and settlement functions of the two organisations.
Click here for the press release

The Department of Internal Affairs

Minister announces decisions on third Auckland bill
Local Government Minister Rodney Hide has announced Cabinet decisions for a third bill to complete the legislative framework for the reform of Auckland's governance. The Local Government (Auckland Law Reform) Bill (which was introduced to the House on 10 December and passed its first reading on 15 December) will:

  • transfer Auckland's assets and liabilities to the new council;
  • protect the interests of staff who move from the old councils to the new council; and
  • give the new council the powers it needs to be up and running on 1 November 2010.

Click here for the press release

More Cabinet decisions on Auckland governance released
The Minister of Local Government has directed the Department of Internal Affairs to post on its website further Cabinet papers and minutes on the Government's decisions in response to the Royal Commission on Auckland Governance. These include: decisions made on the third bill for the reform of Auckland's governance; details for the operation of local boards; decisions that will lead to a statutory board to represent the interests of Māori and the arrangements which will be made for a Pacific advisory panel and an ethnic advisory panel to have input into council decision making.
Click here to view those papers

Ministry of Economic Development (MED)

Outcome of ministerial review of electricity market performance 2009
Energy and Resources Minister Gerry Brownlee has announced a suite of changes to New Zealand's electricity system "to improve competition and constrain price increases, increase security of supply, and ensure effective and stream-lined governance". This follows the release of the preliminary ministerial report on the performance of the electricity market and its governance arrangements for public consultation in August 2009. The Government has agreed to 29 new measures which will be implemented by 1 October 2010. The majority of the changes are contained in the Electricity Industry Bill, which was introduced to Parliament on 10 December and passed its first reading on 15 December. Key initiatives in the bill to improve competition include:

  • Transferring Tekapo A and B power stations from Meridian Energy to Genesis Energy, and transferring the government-owned Whirinaki to Meridian Energy;
  • Meridian, Genesis and Mighty River Power undertaking "virtual asset swaps" through a 15 year contract, ensuring the ability of each company to provide increased competition in the island where they currently have little to no generation capacity;
  • Requiring all major electricity generators to put in place an accessible electricity hedge market;
  • Allowing lines companies back into electricity retailing, subject to strict controls; and
  • Establishing a $15 million fund over three years to promote customer switching between retailers.

Initiatives to increase security of supply include:

  • Requiring generators/retailers to compensate consumers in the event of conservation campaigns or a dry-year power cut;
  • Abolishing the reserve energy scheme; and
  • Increasing the attractiveness of gas exploration and development.

Initiatives to ensure effective governance include:

  • Abolishing the Electricity Commission and replacing it with a slimmed-down Electricity Authority, with fewer objectives and functions than the current commission;
  • Establishing a Security and Reliability Council to monitor Transpower's performance and advise on security of supply; and
  • Transferring responsibility for grid upgrade approvals to the Commerce Commission.

Click here for the full press release and accompanying documents
Click here for further background material, including submissions on the report
Click here for Bell Gully commentary on the preliminary ministerial report

Amendments to financial advisers legislation introduced
The Financial Services Providers (Pre-Implementation Adjustments) Bill was introduced to Parliament on 8 December. The bill makes some technical amendments to the Financial Service Providers (Registration and Dispute Resolution) Act and introduces some measures to simplify the implementation of the Financial Advisers Act and reduce some of the compliance costs associated with the new regime, mainly in relation to the qualifying financial entity (QFE) model. The proposed changes include:

  • Requiring a QFE to name individual contractors whose advice it will take responsibility for, instead of automatically being responsible for advice from all its contractors.
  • Allowing a QFE's employees and named contractors to provide financial adviser services on the QFE's category 1 products (complex products such as shares), without being individually licensed. This is currently permitted only for the QFE's employees.
  • Permitting the employees and named contractors to provide financial adviser services for products for which the QFE is a promoter under the Securities Act. Currently, the Financial Advisers Act allows this only if the QFE is the issuer of the product.

Mr Power said he expects the changes to take effect in the first half of next year. The Government is still working through potential changes to the way investment transactions are regulated under the Financial Advisers Act, following recent targeted consultation with industry.
Click here for the full press release

First Financial Services Disputes Resolution Scheme application
Financial Services Complaints Limited has become the first body to apply to set up a financial sector consumer disputes resolution scheme under the Financial Service Providers (Registration and Dispute Resolution) Act 2008.
Click here for further details
Guidelines to assist in establishing an approved financial sector consumer disputes resolution scheme can be found here.

Bill improves quality of corporate trustees' supervision
A bill that requires corporate trustees and certain statutory supervisors to be licensed was introduced to Parliament on 15 December by Commerce Minister Simon Power. The overarching objective of the Securities Trustees and Statutory Supervisors Bill is to protect the interests of investors, and enhance investor confidence in financial markets, by:

  • requiring persons who wish to be appointed as trustees, statutory supervisors, and unit trustees to be capable of effectively performing the functions of trustees, statutory supervisors, or unit trustees;
  • requiring trustees, statutory supervisors, and unit trustees to perform their functions effectively; and
  • enabling trustees, statutory supervisors, and unit trustees to be held accountable for any failure to perform their functions effectively.

The new regime will apply to trustees of debt securities, unit trustees, and statutory supervisors of certain collective investment schemes and retirement villages.

The bill removes the automatic statutory approval for the six current trustee corporations (although temporary licences will be granted to these corporations under transitional measures in the bill), and requires all trustees, statutory supervisors, and unit trustees to be licensed by the Securities Commission. Under the bill all trustees, statutory supervisors, and unit trustees must be bodies corporate, and their directors and senior managers must be of good character. Retirement village statutory supervisors have been included in the regime in recognition of the similar role they play to trustees of investment products, in monitoring the financial position of retirement villages.

The bill contains a number of provisions designed to ensure that trustees, statutory supervisors, and unit trustees comply with their obligations and the Securities Commission may seek pecuniary penalty and compensatory orders against those who fail to comply with their obligations. Pecuniary penalties may be up to $200,000 when a breach has materially prejudiced investors' interests, and up to $100,000 in other cases. Compensation orders will require the trustee, statutory supervisor, or unit trustee to pay compensation to security holders for any loss caused by breach of its obligations.

Under the bill, trustees, statutory supervisors, and unit trustees are required to:

  • report to the Securities Commission any breach or potential breach of any issuer obligation and notify the commission of the steps that they intend to take as a result:
  • report to the Securities Commission when any issuer they supervise is likely to become insolvent, and notify the commission of the steps that they intend to take as a result; and
  • when requested by the Securities Commission, attest as to the issuer's compliance with the issuer obligations. In circumstances where they cannot so attest, they must state the reasons why.

Trustees, statutory supervisors, and unit trustees are exempt from liability if they provide information to the Securities Commission in good faith in any of these circumstances. Where action is required urgently to protect the interests of investors, and the trustee, statutory supervisor, or unit trustee has failed to act, then the bill provides that the commission has the power either to:

  • direct the trustee, statutory supervisor, or unit trustee to take a particular action, or
  • go to the court to seek an order to protect the interests of investors. Amongst other things, the order could be to convene a meeting of security holders, amend the deed, or appoint a receiver.

The bill is expected to receive its first reading in 2010.
Click here for the press release

New regulations for moratorium proposals
Debt issuers, including finance companies, dealing with moratorium proposals will face tougher measures from 31 January next year, Commerce Minister Simon Power announced on 14 December. In simple terms, moratorium proposals provide investors with a choice between a moratorium (forgoing interest or principal repayments (or both) for a period of time) and a receivership. To date moratorium proposals have been used by 12 finance companies with approximately $2 billion involved. The new Securities (Moratorium) Regulations 2009 (which have been signed off by Cabinet but not yet gazetted) require companies proposing moratoria to give investors tailored disclosure documents. They also require companies already in moratorium to report their progress to investors. Should a moratorium not proceed as planned, secured investors will be able to vote for a receiver to be appointed.
Click here for the press release

Role of government in capital market development
The Capital Market Development Taskforce has released a report prepared by Nick Davis of MartinJenkins on the role of government in capital market development. The report:

  • outlines why government should care about the performance of financial markets;
  • briefly summarises the ways in which government policies and operational activities impact on capital markets; and
  • develops a high-level framework for considering the role of government in capital market development.

Click here to read the full report

Commerce Act deadline extended
Commerce Minister Simon Power has announced that the Commerce Commission has been given a six-month extension to finalise input methodologies under Part 4 of the Commerce Act. As a result of the extension, the Commission's statutory deadline for determining input methodologies will be extended to 31 December 2010 and its deadline for determining airport information disclosure regulations will be extended from 1 July 2010 to 1 January 2011.
Click here for the press release

Emissions ruling scheme
MED has released a discussion document outlining proposed regulations to set fees and charges to cover the administration costs associated with providing the emissions ruling service for the New Zealand Emissions Trading Scheme established under the Climate Change Response Act 2002. The Act provides for a person to apply to the Chief Executive of MED for an emissions ruling on various matters, including: whether a person's activity falls under mandatory participation or voluntary participation; the correct application of data collection requirements; and the correct application of a methodology for calculating emissions or removals. Submissions close on 1 February 2010.
Click here for further details

Review of continuity of employment provisions
Employment provisions under Part 6A of the Employment Relations Act are to be reviewed. Part 6A provides a framework for continuity of employment where an employer's business undergoes restructuring and the employee's work is assigned to a new employer. It particularly affects industries such as cleaning, food and laundry services, where work is often contracted and the change of a contract can create a restructuring or redundancy situation. The Department of Labour has published its proposed Terms of Reference for the review and it is expected that a discussion document will be released in February 2010.
Click here for the press release

Ministry for the Environment

Climate Change Response (Moderated Emissions Trading) Amendment Act 2009
The Government, with Māori Party support, has passed an Act to revise New Zealand's Emissions Trading Scheme. Features of the amendment Act include:

  • revised entry dates of 1 July 2010 for transport, energy and industrial sectors and 1 January 2015 for agriculture;
  • a transitional phase until 1 January 2013 with a 50% obligation and $25 fixed price option for the transport, energy and industrial sectors;
  • a production-based industry average approach to allocations for trade exposed, emissions intensive businesses;
  • a phase-out of industry support aligned with trading partners and the Government's long-term 50% by 2050 emissions reduction target;
  • incentives for afforestation created by a domestic and international market for carbon credits
  • enhanced transitional support for the fishing industry; and
  • a Treaty of Waitangi clause.

Click here for Bell Gully commentary on the amendment Act
Click here for the Minister's press release
Click here for questions and answers on the amendment Act
Click here for further background

Electricity Commission

Joint electricity and gas consumer complaints resolution scheme approved
On 10 December 2009 the Electricity Commission notified that it had approved the complaints resolution system called the Electricity and Gas Complaints Commissioner Scheme. From 1 April 2010, it is mandatory for all electricity and gas retailers and distributors (including Transpower) to participate in the approved scheme. This means that if complaints are unable to first be resolved by the relevant retailer or distributor, all electricity and gas consumers will be able to refer their complaint to a single, independent and free disputes resolution service. Features of the approved scheme include:

  • An independent commissioner as principal decision-maker with overall accountability for determinations.
  • A complaints commission with a balanced board of consumer and industry representatives, and an independent chair, overseeing the work of the commissioner.
  • An EGCC Office supporting the commissioner, including industry-experienced conciliators to handle enquiries, mediate disputes and assist with determinations.

Click here for further details

Securities Commission

Draft Policy: The Designation and Oversight of Designated Settlement Systems
The enactment of the Reserve Bank of New Zealand Amendment Act 2009 last month extended the scope of the systems that can be designated to systems that clear and settle products (notably securities) as well as payments. The Act creates a new Part 5C of the Reserve Bank of New Zealand Act 1989. Part 5C of the Reserve Bank of New Zealand Act 1989 makes the Reserve Bank and the Securities Commission joint regulators of designated settlement systems, but with the Reserve Bank as the sole regulator of designated settlement systems that are declared to be pure payment systems. As such, the Reserve Bank and the Securities Commission have released a draft policy document for public consultation entitled The Designation and Oversight of Designated Settlement Systems. This document explains the roles and policies of the Reserve Bank and the Securities Commission in relation to the designation and oversight of designated settlement systems. Once the submissions on the discussion document have been considered the Reserve Bank and the Securities Commission will finalise the policy document and release it together with a separate document - Application Guidelines for Designation under Part 5C of the Reserve Bank of New Zealand Act 1989. The Reserve Bank and the Securities Commission will then accept applications from settlement systems seeking designation under Part 5C of the Reserve Bank of New Zealand Act 1989. Submissions close on 22 January 2010.
Click here for the press release

Thoughts for Hanover investors
The Securities Commission Chair Jane Diplock has published her views on some of the questions that investors in Hanover Finance and United Finance should consider before making the decision on whether to exchange their frozen investments for shares in Allied Farmers Limited, or stick with the status quo.
Click here to read this article

Securities Commission appointment
Shelley Cave, a partner at Simpson Grierson, has been appointed as a new member of the Securities Commission. Ms Cave succeeds Cathy Quinn, who is stepping down from the Commission after more than nine years of service.
Click here for more

SECURITIES ACT EXEMPTION NOTICES

The following Securities Act Exemption Notices have been published for this period:

Securities Act (Short Form Prospectus) Exemption Amendment Notice 2009
This notice, which came into force on 11 December 2009, amends the Securities Act (Short Form Prospectus) Exemption Notice 2009 to:

  • change the expiry date of the exemptions from various provisions of the Securities Regulations 1983 from 30 September 2012 to 31 December 2011 (since offers of securities cannot continue to be made in prospectuses that comply with the Securities Regulations 1983 after 31 December 2011); and
  • extend an existing exemption from section 34(2)(a) of the Securities Act 1978 so that it applies in respect of offers under the Securities Regulations 2009 (as well as offers under the Securities Regulations 1983).

Securities Act (Transition to Securities Regulations 2009) Exemption Notice 2009
This notice, which came into force on 27 November 2009 and expires on 14 November 2014, provides for existing exemptions from provisions of the Securities Regulations 1983 to be extended to equivalent provisions of the Securities Regulations 2009 (with the effect that issuers and other persons will be able to continue to rely on those exemptions in respect of offers of securities under the 2009 regulations). This includes exemptions from all of the requirements of the 2009 Regulations (except regulation 23) where the commission has previously granted exemptions from all of the requirements of the 1983 Regulations (except regulation 8), and exemptions from all of the requirements of a particular schedule of the 2009 Regulations where the commission has previously granted exemptions from all of the requirements of the corresponding schedule of the 1983 Regulations. This general exemption notice has been issued to provide for a smoother transition between the 1983 and 2009 Regulations and is a temporary measure. An exemption under this notice will cease to apply when the existing notice is varied so as to include express exemptions from any provision or provisions of the 2009 regulations.

Securities Act (Macquarie Media Group) Exemption Notice 2009
This notice, which comes into force on 11 December 2009 and expires on 31 December 2010, contains exemptions, subject to conditions, from requirements of the Securities Act 1978 and the Securities Regulations 2009 that apply in connection with a corporatisation of the Macquarie Media Group. The exemptions accord with the policy behind the Securities Act (Overseas Companies) Exemption Notice 2002.

Securities Act (ING (NZ) Limited) Exemption Notice 2009
This notice, which came into force on 30 November 2009 and expires on 30 November 2010, exempts, subject to a condition, the issuers of certain securities of which ING (NZ) Limited is the issuer or a promoter from regulation 7A(4) of the Securities Regulations 1983 in respect of information about a particular acquisition that must be disclosed in any investment statement that is dated before 31 October 2009. This exemption allows ING to produce a supplementary disclosure document so that prospective investors can be informed about the acquisition without incurring costs and delay in producing new investment statements.

Takeovers Panel

TAKEOVERS CODE EXEMPTION NOTICES

The following Takeovers Code Exemption Notices have been published for this period:

Takeovers Code (Biovittoria Limited) Exemption Notice 2009
This notice applies to acts or omissions occurring on or after 21 January 2009 and expires on 31 March 2010. The Takeovers Panel has granted an exemption from rule 6 of the Takeovers Code, subject to conditions, to Dennis Row, Joan Row, and SW Trust Services Limited (the Avalon trustees) as trustees of the Avalon Trust in respect of an allotment to them of ordinary shares in Biovittoria Limited on 21 January 2009. The Avalon trustees may have been associates of other shareholders in Biovittoria Limited at the time of the allotment and consequently may have exceeded 20% of the voting rights in Biovittoria Limited.

Takeovers Code (Te Kairanga Wines Limited) Exemption Notice 2009
This notice applies to acts or omissions occurring on or after 16 December 2009 and expires on 31 May 2010. The Takeovers Panel has granted the following exemptions in respect of a rights issue to be conducted by Te Kairanga Wines Limited (TKW) and a placement of shares in that company:

  • an exemption from rule 7(d) of the Takeovers Code (the Code) for certain interests associated with Peter Vernon Hubscher to the extent that that rule requires the notice of meeting to comply with the disclosure requirements of rule 16(b)(ii) to (iv) of the Code; and
  • an exemption from rule 16(b)(ii) to (iv) of the Code for TKW in respect of the notice of meeting.

Takeovers Code (Just Water International Limited) Exemption Notice (No 2) 2009
Just Water International Limited (Just Water) is listed on the NZX Alternative Market. The Takeovers Panel has granted a retrospective exemption from rule 6(1) of the Takeovers Code to Professor Whittred in respect of the increase in his control of voting rights in Just Water that resulted from his appointment as a trustee of the Falkenstein University of Auckland Business School Charitable Trust, following his appointment as the Dean of The University of Auckland Business School. The Trust controls 2,000,000 voting securities in Just Water with the shares being held by the board of the Trust. The notice applies to acts or omissions occurring on or after 6 July 2009 and expires on 31 December 2009.

Takeovers Code (Fulton Hogan Limited) Exemption Notice 2009
The Takeovers Panel has granted exemptions (subject to conditions) in relation to:

  • FHL acquiring its own voting securities under its buyback programme;
  • FHL acquiring up to all of its own voting securities from Royal Dutch Shell plc and its direct and indirect wholly owned subsidiaries;
  • allotments of voting securities under FHL's employee share scheme;
  • allotments of voting securities under FHL's share bonus scheme;
  • transfers of voting securities between persons who are Fulton family shareholders;
  • transfers of voting securities between persons who are Hogan family shareholders; and
  • allotments of voting securities under a 1 for 12 pro rata non-renounceable offer to be made by FHL to its shareholders

This notice applies to acts or omissions occurring on or after 27 November 2009 and expires on 31 October 2015.

New Zealand Exchange (NZX)

NZXR decision - class waiver for all NZSX and NZAX issuers
NZX Regulation will submit proposed amendments to the NZSX/NZDX and NZAX Listing Rules (the Rules) to the Minister of Commerce to reflect amendments made to the Securities Act (NZX-Share and Unit Purchase Plans) Exemption Notice 2005 by the Securities Act (NZX-Share and Unit Purchase Plans) Exemption Amendment Notice 2009, which became effective on 25 September 2009. To ensure that issuers are not prejudiced by any delay in this amendment coming into effect, NZX has provided interim relief to issuers by way of a class waiver from Rule 7.3.1, so as to allow all issuers to make an offer under the terms of the amended Exemption Notice without the need to seek specific waivers from the relevant Rule.
Click here for the NZX press release and details of the terms and conditions of the class waiver
Click here for Bell Gully commentary on the changes to the 2005 Exemption Notice

Australian Government

Consultation on market supervision reforms
The Minister for Financial Services, Superannuation and Corporate Law, the Hon Chris Bowen MP, has released a consultation paper and draft legislation facilitating reforms to the supervision of Australia's financial markets. This follows on from the announcement on 24 August this year by the Treasurer and Minister Bowen that the Australian Securities and Investments Commission would take over the supervision of real-time trading on all of Australia's domestic licensed markets.
Click here for more

Government welcomes report into financial services and products
The Minister for Financial Services, Superannuation and Corporate Law has welcomed the release of the report into financial services and products by the Parliamentary Joint Committee on Corporations and Financial Services. "This report is a welcome contribution on the discussion over the future direction of the financial advice industry and investor protection in Australia," Mr Bowen said.
Click here to read the press release
Click here to access the report

Australian Securities and Investments Commission (ASIC)

Updated regulatory guide and new consultation paper regarding schemes of arrangement
ASIC has released an updated Regulatory Guide 60 Schemes of arrangement (RG 60) and Consultation Paper 127 Schemes of arrangement: Statements under s411(17)(b) (CP 127).The update is largely minor and technical. ASIC is also considering what future guidance might be provided regarding reverse takeover schemes in light of the decision in Re Gloucester Coal Limited 01R(a) and (b) [2009] ATP 9.
Click here for further details

ASIC seeks feedback on proposal to develop listed corporate bond market
ASIC has released Consultation Paper 126 Facilitating Debt Raisings to assist with the development of a sustainable listed corporate bond market in Australia. The paper proposes relief from long form prospectus requirements including:

  • a shorter prospectus for bond offers focused on the terms of the offer and the ability of the bond issuer to meet its interest and repayment obligations; and
  • a two-part prospectus designed to provide successive bond offers offering greater flexibility and speed-to-market in making bond offers.

Comments are due by 19 February 2010.
Click here for further details

ASIC prepares for the transfer of market supervision
Following the release of the consultation paper on Reforms to the Supervision of Australia's Financial Markets by Treasury, ASIC has announced arrangements for managing the transfer of front line market supervision from the Australian Securities Exchange to ASIC.
Click here for further details

Information for issuers and advisers of margin lending facilities
ASIC has released updated policy and regulatory guidance to assist issuers and advisers of margin lending facilities comply with new licensing, conduct and disclosure requirements, following the passage of the Corporations Legislation Amendment (Financial Modernisation) Act 2009.
Click here for more

Consultation paper outlining proposed guidance to directors on their duty to prevent insolvent trading
ASIC has released a Consultation Paper outlining proposed guidance to directors on their duty to prevent insolvent trading. The Corporations Act imposes a positive duty on directors to prevent insolvent trading. The proposed guidance, contained in Consultation Paper 124 Directors' duty to prevent insolvent trading: Guide for directors (CP 124), sets out the relevant legal background to the duty to prevent insolvent trading and the key principles that ASIC considers directors need to take into account in performing their duty to prevent insolvent trading. Those principles are that a director:

  • must keep him or herself informed about the financial affairs of the company and regularly assess the company's solvency;
  • immediately on identifying concerns about the company's viability, should take positive steps to confirm the company's financial position and realistically assess the options available to deal with the company's financial difficulties;
  • should obtain appropriate advice from a suitably qualified person; and
  • should consider and act appropriately on the advice received in a timely manner.

Click here for further details

New Zealand Commerce Commission (NZCC)

Media releases

The NZCC has issued the following media releases:

Industry regulation and regulatory control

  • Determination for electricity distribution businesses' price-quality path released
    The NZCC has released its determination and decisions paper for the price-quality path which will apply to electricity distribution businesses from 1 April 2010. This marks the first determination published by the NZCC under the Commerce Act's new Part 4 regime and announces significant decisions for electricity distribution businesses on price and quality.
    Click here for more

  • Consultation on input methodologies extended
    The NZCC has released two revised process papers, following the granting of an extension to the timeframe for determining Input Methodologies and the Information Disclosure Requirements for Airports. The Minister of Commerce granted the NZCC an extension of six months, allowing for completion of the Input Methodologies by 31 December 2010, and a determination on Information Disclosure for Airports by 1 January 2011.
    Click here for more

Mergers and acquisitions

  • Draft divestment guidelines released for consultation
    The NZCC has released draft guidelines on how divestment undertakings as part of a merger or acquisition application will be treated.
    Click here for more

Market behaviour

  • Energy companies warned over alleged anti-competitive behaviour
    The NZCC has issued a formal warning to two energy companies alleged to have attempted to engage in anti-competitive conduct during the purchase by tender of a power station near Nelson in 2002.
    Click here for more

Telecommunications

  • Next steps for mobile termination investigation
    As part of the NZCC's investigation into mobile termination rates, the NZCC has written to 2degrees, Telecom and Vodafone inviting them to submit final revised undertakings.
    Click here for more

  • Commerce Commission releases two TSO Determinations for 2008/09
    The NZCC has released its 2008/09 final determinations on the cost of the Telecommunications Relay Service (TRS) for the hearing impaired; and the proportion of cost to be met by each party liable to contribute to the cost of the TRS and the local residential telephone service obligation.
    Click here for more

  • Commerce Commission releases draft Telecom TSO cost calculation for 2008/09
    The NZCC released a telecommunication service obligation (TSO) Cost Calculation Determination for the Local Residential Telephone Service covering the 2008/09 year. The draft cost is $69.7 million.
    Click here for more

Consumer issues

  • Supreme Court allows Commerce Commission appeal
    A Supreme Court judgment allows the NZCC to proceed with a significant compensation claim against Carter Holt Harvey related to mis-graded timber. The Supreme Court has overturned a previous Court of Appeal ruling that the NZCC had filed proceedings against Carter Holt Harvey outside the limitation period allowed by the Fair Trading Act.
    Click here for more

  • Telecom fined $500,000 for misleading over Go Large plan
    Telecom New Zealand Limited has pleaded guilty to 17 charges of breaching the Fair Trading Act over claims made in 2006 when promoting Xtra's Go Large broadband plan. Telecom has been fined $500,000 in the Auckland District Court.
    Click here for more

  • Holiday voucher company pleads guilty to Fair Trading Act breaches
    Discount Premium Holidays Limited, a New Zealand registered company that operated from Australia selling holiday vouchers in New Zealand, has pleaded guilty to 38 charges of breaching the Fair Trading Act and has been fined $209,000 in the Auckland District Court. The company's director has also pleaded guilty to two charges under section 103 of the Commerce Act for attempting to deceive or knowingly mislead the Commerce Commission during the Commission's investigation. He has been fined $7,000.
    Click here for more

Australian Competition and Consumer Commission (ACCC)

ACCC media releases

The ACCC has issued the following media releases:

Mergers and acquisitions

  • ACCC to oppose proposed acquisition of ITC Timber by Gunns
    The ACCC announced that it intends to oppose the proposed acquisition of ITC Timber Pty Ltd by Gunns Limited.
    Click here for more

  • ACCC allows revised proposed acquisition of ITC Timber by Gunns after restructure addresses concerns
    The ACCC will not oppose the revised proposed acquisition of ITC Timber Pty Ltd by Gunns Limited after the ACCC's competition concerns were addressed with the exclusion of ITC Timber's 50% stake in the SmartFibre wood chip joint venture from the transaction.
    Click here for more

  • ACCC to oppose the acquisition of Mobil retail assets by Caltex
    The ACCC announced that it intends to oppose the proposed acquisition of Mobil Oil Australia's retail assets by Caltex Australia Limited. The ACCC's decision to oppose was based on the likely effect of the proposed acquisition on local market competition for the supply of petrol, diesel and automotive LPG.
    Click here for more

Market behaviour

  • Beauty supplier addresses ACCC concerns about resale price maintenance
    International Beauty Supplies has admitted a contract it entered into with distributors for the resale of its beauty products is likely to have breached the resale price maintenance provisions of the Trade Practices Act 1974. International Beauty Supplies will write to its distributors informing them that they are free to advertise and sell goods supplied by International Beauty Supplies at any price they wish.
    Click here for more

  • ACCC allows admission and interview policies of graduate-entry medical schools
    The ACCC has granted authorisation for five years to policies which govern the selection and interviewing of applicants to study medicine at Australian graduate-entry medical schools.
    Click here for more

  • Transparency is key for drug industry relationships
    The ACCC has decided to grant authorisation for five years to Medicines Australia's 16th edition of its Code of Conduct. The Code sets standards for the marketing and promotion of prescription pharmaceutical products in Australia.
    Click here for more

  • ACCC imposes conditions on AAT's operations
    The ACCC has granted conditional authorisation to Australian Amalgamated Terminals Pty Ltd allowing it to operate motor vehicle and general cargo handling facilities, known as terminals, at ports in Brisbane, Wollongong, Melbourne, Launceston and Adelaide.
    Click here for more

  • ACCC grants interim authorisation to TFGA to collectively negotiate growing contracts
    The ACCC has granted interim authorisation to the Tasmanian Farmers & Graziers Association for an arrangement between present and future vegetable grower members to collectively negotiate the terms and conditions of growing contracts with McCain Foods (Aust) Pty Ltd and Simplot Australia Pty Ltd.
    Click here for more

  • Restrictive ice hockey policy raises competition concerns
    The ACCC has issued a draft notice proposing to revoke Ice Hockey Australia's notification, under which its members will be prevented from playing in ice hockey competitions that have not been approved by Ice Hockey Australia.
    Click here for more

  • ACCC allows car rental companies to collectively bargain with Mackay Airport
    The ACCC has not objected to a notification lodged by a group of car rental companies seeking to collectively negotiate with Mackay Airport. The members of the proposed bargaining group, Hertz, Thrifty, Avis, Budget and Europcar, wish to collectively bargain with Mackay Airport about the terms and conditions governing their continued operation at the airport.
    Click here for more

  • ACCC objects to Australia Post's draft pricing proposal
    The ACCC issued its view objecting to Australia Post's draft proposal to increase the prices of the letter services over which it has a statutory monopoly in 2010. Australia Post provided the ACCC with its draft pricing proposal on 24 July 2009, which sought increases in the prices of a number of its Small, Large and PreSort letter services. Australia Post also sought to increase the basic postage rate from 55 to 60 cents.
    Click here for more

  • ACCC gives final approval to long term port solution
    The ACCC has issued its final decision approving the port-based Capacity Framework Arrangements which form part of the integrated long term solution to the ongoing capacity constraints in the Hunter Valley coal chain.
    Click here for more

  • ACCC allows Virgin Blue and Delta joint venture
    The ACCC has granted authorisation to Virgin Blue and Delta Air Lines to enter into a joint venture on their flights between Australia and the United States (the trans-Pacific routes). Under the joint venture, the airlines would take a coordinated approach to a range of issues, including pricing, revenue management, schedules, capacity and routes flown.
    Click here for more

Telecommunications

  • ACCC commences review to vary DTCS service description
    The ACCC has commenced a public inquiry into a variation of the service description for the domestic transmission capacity service. The DTCS is a generic service for the carriage of voice, data or other communications using wideband or broadband carriage.
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  • ACCC launches review into telecommunications access pricing and holds current levels
    The ACCC has announced a fundamental review of the Access Pricing Principles for telecommunications services. "This is a critical review of pricing principles which have been in place since 1997. Since this time the telecommunications regulatory, technological and competitive landscape, have and continue to evolve, and a review is timely," ACCC chairman Graeme Samuel said.
    Click here for more

Access

  • ACCC invites comments on draft advice to the Minister on amendments to Water Market Rules and Water Charge (Termination Fees) Rules
    The ACCC has issued its draft advice to the Minister for Climate Change and Water on proposed amendments to the Water Market Rules and Water Charge (Termination Fees) Rules, including recommended amendments to the Rules.
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Consumer issues

  • Another bedding retailer corrects price representations
    Yarrabee Investments Pty Ltd has stopped false and misleading price advertisements on its bedding products after the ACCC raised concerns over the genuineness of their recommended retail price representations.
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  • Scammers focus on cheap holiday accommodation offers
    As plans are made for holidays, scammers are out there designing their next move to appropriate hard earned dollars. "This time each year, the ACCC receives complaints from holiday makers who find that the cheap accommodation vouchers they have paid for either don't arrive, are fakes, or simply can't be used as promised," ACCC deputy chair, Peter Kell, said.
    Click here for more

  • ISS Hygiene customers given credit note for missed services
    ISS Hygiene has given additional credit notes to customers after an ACCC investigation into allegations of missed services. A Brisbane branch audit conducted by ISS Hygiene in October 2008 found a considerable number of washroom hygiene services had been missed due to failures to follow the correct procedures for reporting and handling late services.
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  • Dangerous children's toys stopped at border
    Children's toys containing dangerous levels of lead have been intercepted and seized in Melbourne as part of a joint agency operation. More than 500 tests were conducted on 165 samples and thousands of toys have been seized. Excessive lead levels were discovered in counterfeit Ben 10 figures, camouflage tommy guns, boxing gloves and a ride-on motorcycle.
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  • Personalised Chocolates 4U franchisor misled and deceived franchisees
    The Federal Court has declared that Personalised Chocolates 4U Pty Ltd and its sole director, Troy Patching, misled franchisees and engaged in conduct in breach of the Franchising Code of Conduct, following legal action by the ACCC.
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  • ACCC leads national action to raise awareness of blind and curtain cord dangers
    The ACCC is leading a nation-wide campaign to check and fix dangerous blind and curtain cords after two infants were strangled by cords earlier this year. "The ACCC and state and territory consumer regulators are working together to raise awareness of the potential hazard loose curtain and blind cords pose," ACCC deputy chairman, Peter Kell, announced.
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  • Pyramid scheme collapses following Federal Court decision
    Cosic Holdings Pty Ltd has been found to have taken part in an illegal international pyramid selling scheme known as Emerald Passport. After ACCC action, the Federal Court in Perth has declared that Cosic Holdings had breached the Trade Practices Act 1974. The Emerald Passport scheme promoted self help products which included internet based audio visual presentations such as Mastering Money and Wealth Fundamentals.
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Legislation round-up

The following is an overview of the status of all legislation promulgated during the period from 21 November 2009 to 15 December 2009 or currently before Parliament.

If you require any further information or advice on any of the legislation listed below, or would like our assistance with making a submission to a select committee on any bill, please contact your usual Bell Gully adviser.

New Acts

Act

Date Act is in force

Biosecurity Amendment Act 2009

7 December 2010

Climate Change Response (Moderated Emissions Trading) Amendment Act 2009

8 December 2009

Cluster Munitions (Prohibition) Act

Awaiting assent

Corrections (Contract Management of Prisons) Amendment Act 2009

8 December 2009

Corrections (Use of Court Cells) Amendment Act 2009

8 December 2009

Crimes (Provocation Repeal) Amendment Act 2009

8 December 2009

Customs and Excise Amendment Act 2009

Section 12 comes into force on 1 October 2010

Sections 10 and 11, Part 3 of Schedule 1, and Schedule 2 come into force on 1 January 2010

The rest of the Act came into force 8 December 2009

Legal Services Amendment Act

Awaiting assent

Methodist Church of New Zealand Trusts Act

Awaiting assent

Policing (Constable's Oaths Validation) Amendment Act 2009

8 December 2009

Remuneration Authority Amendment Act 2009

8 December 2009

Subordinate Legislation (Confirmation and Validation) Act

Awaiting assent

Tariff Amendment Act 2009

Sections 6!1), 8, and 9, and the Schedule come into force on 1 January 2010

Sections 4 and 5 come into force immediately after the commencement of the Tariff (AANZFTA) Amendment Act 2009 (1 January 2010)

The rest of this Act came into force 8 December 2009

Taxation (Consequential Rate Alignment and Remedial Matters) Act 2009

Commencement

 

New Regulations

Regulation

Date regulation is in force

Animal Welfare (Leg-hold Traps) Amendment Order 2009

28 December 2009

Arms Amendment Regulations 2009

1 January 2010

Climate Change (The New Zealand Refining Company Limited) Exemption Order 2009

31 December 2009

Climate Change (Oceana Gold (New Zealand) Limited) Exemption Order 2009

31 December 2009

Climate Change (General Exemptions) Order 2009

31 December 2009

Corrections Amendment Regulations 2009

1 January 2010

Crimes (Interception Warrants) Amendment Regulations 2009

1 December 2009

Crown Entities (New Zealand Fast Forward Fund Limited) Order 2009

24 December 2009

Customs and Excise (AANZFTA) Amendment Act 2009 Commencement Order 2009

1 January 2010

Customs and Excise (Rules of Origin for AANZFTA Goods) Amendment Regulations 2009

1 January 2010

Customs and Excise (Specified AANZFTA Parties) Order 2009

1 January 2010

District Courts Amendment Rules 2009

1 December 2009

Double Taxation Relief (United States of America) Amendment Order 2009

28 November 2009

Education (Export Education Levy) Regulations 2009

1 January 2010

Immigration Amendment Regulations (No 2) 2009

30 November 2009

Income Tax (Fringe Benefit Tax, Interest on Loans) Amendment Regulations (No 3) 2009

27 November 2009

Income Tax (Minimum Family Tax Credit) Order 2009

1 April 2010

New Zealand Superannuation and Retirement Income Amendment Act 2009 Commencement Order 2009

5 January 2010

Ombudsman Act (Schedule 1) Order 2009

24 December 2009

Public Finance (New Zealand Fast Forward Limited) Order 2009

24 December 2009

Road User Charges Amendment Regulations (No 2) 2009

1 January 2010

Securities Act (ING (NZ) Limited) Exemption Notice 2009

1 December 2009

Securities Act (Macquarie Media Group) Exemption Notice 2009

11 December 2009

Securities Act (Short Form Prospectus) Exemption Amendment Notice 2009

11 December 2009

Securities Act (Transition to Securities Regulations 2009) Exemption Notice 2009

27 November 2009

Sentencing Amendment Regulations 2009

1 December 2009

Summary Proceedings Amendment Regulations (No 2) 2009

1 December 2009

Takeovers Code (Biovittoria Limited) Exemption Notice 2009

21 January 2009 (Application)

Takeovers Code (Fulton Hogan Limited) Exemption Notice 2009

27 November 2009 (Application)

Takeovers Code (Just Water International Limited) Exemption Notice (No 2) 2009

6 July 2009 (Application)

Takeovers Code (Te Kairanga Wines Limited) Exemption Notice 2009

16 December 2009 (Application)

Tariff (AANZFTA) Amendment Act 2009 Commencement Order 2009

1 January 2010

Tariff (AANZFTA) Amendment Order 2009

1 January 2010

Tariff (Specified AANZFTA Parties) Order 2009

1 January 2010

Valuers Amendment Regulations 2009

1 January 2010

War Pensions Amendment Act 2009 Commencement Order 2009

5 January 2010

Weights and Measures Amendment Regulations 2009

1 April 2010

 

New Bills

Bill

Date of introduction

Type of bill

Appropriation (2008/09 Financial Review) Bill

9 December 2009

Government

Christ's College (Canterbury) Amendment Bill

9 December 2009

Private

Courts (Remote Participation) Bill

8 December 2009

Government

Electricity Industry Bill

10 December 2009

Government

Financial Service Providers (Pre-Implementation Adjustments) Bill

8 December 2009

Government

Human Assisted Reproductive Technology (Storage) Amendment Bill

24 November 2009

Government

Local Government (Auckland Law Reform) Bill

10 December 2009

Government

Mental Health (Compulsory Assessment and Treatment) Amendment Bill

10 December 2009

Member's

Securities Trustees and Statutory Supervisors Bill 15 December 2009 Government

Statutes Amendment Bill

24 November 2009

Government

Television New Zealand Amendment Bill

9 December 2009

Government

Trans-Tasman Proceedings Bill

24 November 2009

Government

 

Bills sent to select committees

Bill

Select Committee

Electricity Industry Bill Finance and Expenditure Committee

Fair Trading (Soliciting on Behalf of Charities) Amendment Bill

Commerce Committee

Human Assisted Reproductive Technology (Storage) Amendment Bill

Health Committee

Insurance (Prudential Supervision) Bill

Finance and Expenditure Committee

Local Government (Auckland Law Reform) Bill Auckland Governance Legislation Committee

Statutes Amendment Bill

Government Administration Committee

Taxation (Annual Rates, Trans-Tasman Savings Portability, Kiwisaver, and Remedial Matters) Bill

Finance and Expenditure Committee

Whanganui Iwi (Wanganui (Kaitoke) Prison and Northern Part of Wanganui Forest) On-account Settlement Bill

Maori Affairs Committee

 

Bills open for submissions

Bill

Select Committee

Closing date for submissions

Report due date

Education (Freedom of Association) Amendment Bill

Education and Science

31 March 2010

28 May 2010

Fair Trading (Soliciting on Behalf of Charities) Amendment Bill

Commerce Committee

19 March 2010

9 June 2010

Human Assisted Reproductive Technology (Storage) Amendment Bill

Health Committee

19 February 2010

8 June 2010

Insurance (Prudential Supervision) Bill

Finance and Expenditure Committee

10 February 2010

8 June 2010

Ngati Apa (North Island) Claims Settlement Bill

Maori Affairs Committee

15 January 2010

17 March 2010

Statutes Amendment Bill

Government Administration Committee

11 February 2010

1 April 2010

Taxation (Annual Rates, Trans-Tasman Savings Portability, Kiwisaver, and Remedial Matters) Bill

Finance and Expenditure Committee

10 February 2010

8 June 2010

Whanganui Iwi (Wanganui (Kaitoke) Prison and Northern Part of Wanganui Forest) On-account Settlement Bill

Maori Affairs Committee

15 January 2010

19 March 2010

 

Bills waiting on report back from select committees

Bill

Select Committee

Report due

Arms Amendment Bill (No 3)

Law and Order

26 February 2010

Dairy Industry Restructuring (Raw Milk Pricing Methods) Bill

Primary Production

2 March 2010

Education (Freedom of Association) Amendment Bill

Education and Science

28 May 2010

Electoral (Administration) Amendment Bill

Justice and Electoral

27 April 2010

Fair Trading (Soliciting on Behalf of Charities) Amendment Bill

Commerce Committee

9 June 2010

Franklin District Council (Contribution to Funding of Museums) Amendment Bill

Local Government and Environment

30 April 2010

Human Assisted Reproductive Technology (Storage) Amendment Bill

Health

8 June 2010

Injury Prevention, Rehabilitation, and Compensation Amendment Bill

Transport and Industrial Relations

12 February 2010

Insurance (Prudential Supervision) Bill

Finance and Expenditure

8 June 2010

Land Transport (Driver Licensing) Amendment Bill

Transport and Industrial Relations

30 June 2010

Limitation Bill

Justice and Electoral

2 April 2010

Marine Reserves Bill

Local Government and Environment

30 December 2010

Marine Reserves (Consultation with Stakeholders) Amendment Bill

Local Government and Environment

30 December 2010

Ngati Apa (North Island) Claims Settlement Bill

Maori Affairs

17 March 2010

Patents Bill

Commerce

30 March 2010

Private Security Personnel and Private Investigators Bill

Justice and Electoral

30 March 2010

Public Works (Offer Back of and Compensation for Acquired Land) Amendment Bill.

Local Government and Environment

17 June 2010

Radio New Zealand Amendment Bill

Commerce

24 December 2009

Sale and Supply of Liquor and Liquor Enforcement Bill

Justice and Electoral

30 June 2010

Sale of Liquor (Objections to Applications) Amendment Bill

Social Services

30 June 2010

Search and Surveillance Bill

Justice and Electoral

1 May 2010

Sentencing and Parole Reform Bill

Law and Order

30 March 2010

Statutes Amendment Bill

Government Administration

1 April 2010

Sustainable Biofuel Bill

Local Government and Environment

29 July 2010

Taxation (Annual Rates, Trans-Tasman Savings Portability, Kiwisaver, and Remedial Matters) Bill

Finance and Expenditure

8 June 2010

Waikato-Tainui Raupatu Claims (Waikato River) Settlement Bill

Māori Affairs

30 June 2010

Whanganui Iwi (Wanganui (Kaitoke) Prison and Northern Part of Wanganui Forest) On-account Settlement Bill

Maori Affairs

19 March 2010

 

Bills waiting for second and/or third readings

Bill

Links to select committee reports/SOPs

Antarctica (Environmental Protection: Liability Annex) Amendment Bill

Report of the Foreign Affairs, Defence and Trade Committee

Aquaculture Legislation Amendment Bill (No 2)

Report of the Primary Production Committee

Carter Observatory Act Repeal Bill

Report of Education and Science Committee

Children, Young Persons and Their Families Amendment Bill (No 6)

Report of the Social Services Committee

Children, Young Persons, and Their Families (Youth Courts Jurisdiction and Orders) Amendment Bill

Report of the Social Services Committee

Cultural Property (Protection in Armed Conflict) Bill

Report of the Government Administration Committee

SOP 38

Dog Control Amendment Bill (No 2)

Report of the Local Government and Environment Committee

Education (Polytechnics) Amendment Bill

Report of the Education and Science Committee

Electricity (Continuance of Supply) Amendment Bill

Report of the Commerce Committee

Gambling Amendment Bill (No 2)

Report of the Government Administration Committee

SOP 23 SOP 65 SOP 84

Infrastructure Bill

Report of the Transport and Industrial Relations Committee

Inquiries Bill

Report of the Government Administration Committee

Judicial Matters Bill

Report of the Justice and Electoral Committee

Maori Commercial Aquaculture Claims Settlement (Regional Agreements) Amendment Bill

Report of the Maori Affairs Committee

Motor Vehicle Sales Amendment Bill Report of the Commerce Committee

Oaths Modernisation Bill

Report of the Government Administration Committee

SOP No.103

Privacy (Cross-border Information) Amendment Bill

Report of the Justice and Electoral Committee

Public Health Bill

Report of the Health Committee

Rail Network Bill

Report of the Government Administration Committee

Regulatory Improvement Bill

Report of the Commerce Committee

Regulatory Responsibility Bill

Report of the Commerce Committee

Reserves and Other Lands Disposal Bill

Report of the Primary Production Committee

Residential Tenancies Amendment Bill

Report of the Social Services Committee

Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill

Report of the Education and Science Committee

Therapeutic Products and Medicines Bill

Report of the Government Administration Committee

Trade Marks (International Treaties and Enforcement) Amendment Bill

Report of the Foreign Affairs, Defence and Trade Committee

SOP 83 SOP 85

Trade (Safeguard Measures) Bill

Report of the Foreign Affairs, Defence and Trade Committee

Trustee Amendment Bill

Report of the Justice and Electoral Committee

Unit Titles Bill

Report of the Social Services Committee

Waka Umanga (Māori Corporations) Bill

Report of the Māori Affairs Committee

The Bell Gully Regulator Report is designed to highlight certain New Zealand and Australian corporate, commercial and competition regulatory developments. The Bell Gully Regulator Report is not designed to be comprehensive and is necessarily brief and general in nature and is not intended to provide legal advice. You should seek professional legal advice before taking any action in relation to the matters dealt with in this publication. Bell Gully is not the author of any information received by clicking on the hypertext links and therefore is not responsible for their accuracy.