Submissions on the Ministry of Business, Innovation and Employment’s (MBIE) Commerce (Promoting Competition and Other Matters) Amendment Bill (Bill) closed yesterday, following an extension to the original deadline.
The Bill marks a significant overhaul of New Zealand’s competition regime and is due to be passed in mid-2026. The changes will affect how the Commerce Commission (the Commission) assesses deals, approaches predatory pricing, and manages confidential information.
Overview
The Bill largely follows proposals released in September 2025, which we outlined in an article here. Bell Gully’s submission on the Bill reiterates our support for the introduction of behavioural undertakings in merger assessments and the clearer framework for publication and disclosure of information. You can read our submission here.
We remain unconvinced of the need for other changes to the merger control test and process, particularly where burden of proof rules in our regime could make the deal-making landscape more restrictive in New Zealand compared to other jurisdictions.
The key points from our submission, and the potential implications for businesses if the reforms proceed as currently proposed, are summarised below.
Behavioural undertakings
We strongly support the introduction of behavioural undertakings to address competition issues arising from mergers. Enabling the Commission to accept such remedies could see efficiency-enhancing mergers proceed, where they would otherwise be declined based on a lack of suitable structural (i.e. ‘divestment’) remedies. It also brings New Zealand into line with international peers.
However, the Bill unnecessarily limits the application of behavioural remedies to cases where structural remedies are deemed inadequate or where behavioural remedies are necessary to implement a structural remedy. Given their potential breadth and flexibility, behavioural remedies should be available whenever they achieve better, more proportionate, or lower-cost outcomes. This would be more consistent with the approach in comparable jurisdictions.
Confidentiality
We support clearer rules for publication and disclosure. The current approach to information requests is skewed too heavily towards sharing information with third parties and results in a reluctance to provide information to the Commission. The proposed new section appropriately strikes the balance between protecting sensitive information and allowing parties to properly respond to allegations, including the important “proper interest” safeguard.
Merger assessment burden of proof
New Zealand’s approach to the burden of proof in merger assessments differs from that in other countries and should be aligned with equivalent regimes overseas. This is notably absent from the Bill.
Currently, the burden of proof lies with the applicant and effectively presumes that mergers are anti-competitive unless proven otherwise. We believe best practice would be to align with Australia’s starting position which is that a merger will not substantially lessen competition. Failure to make this change, particularly given the other proposed changes to the merger control regime as set out below, will make New Zealand’s regime much more restrictive than our international peers, making New Zealand a harder place to do business and potentially deterring efficiency-enhancing mergers that would support the growth of our economy.
Call-in and suspension powers
The Bill proposes handing the Commission new “call-in powers” to require merger parties to apply for clearance if there are reasonable grounds to believe a proposed acquisition may substantially lessen competition in a New Zealand market. In our view, the Commission already has sufficient powers to investigate transactions and MBIE has previously confirmed that the current voluntary system is working well. We called on the government to strike out this section.
Additionally, the Bill proposes granting the Commission power to suspend the implementation of a proposed merger for up to 40 working days if it is concerned about competition effects. This could result in significant delays with detrimental consequences for businesses.
Increased scope of merger rules
As addressed in our September 2025 article, we do not agree with the proposal to expand the merger regime by adding provisions for “creeping acquisitions” or entrenchment of market power. No evidence has been offered that these rules will change how the regime is administered, but these changes risk unintended consequences (particularly when the burden of proof is skewed against the merger parties, as set out above). Our submission repeats our call to remove these amendments.
Predatory pricing
As we note in that article, one of the most significant changes in the Bill is the proposal to codify the test for predatory (below cost) pricing by firms with market power. Bell Gully maintains the view that codifying predatory pricing is unnecessary as this conduct is already captured by the existing prohibition on misuse of market power.
A major risk of codification is making certain below-cost pricing an automatic breach of the law, removing the need for any analysis of its actual impact on the market. Low prices are generally pro-competitive, especially if firms do not recoup their losses elsewhere. The proposed rules could see companies being very cautious about offering lower prices, which could ultimately be to the detriment of consumers.
Our submission refers to the approach of our overseas peers, Australia, UK, Europe, and Singapore, which have moved away from a prescribed predatory pricing measure, instead taking an ‘effects-based’ approach. We submitted that New Zealand should do the same.
Next stepS
The Economic Development, Science and Innovation Select Committee is now considering submissions and will report back with recommendations. Bell Gully will be raising key concerns through oral submissions to the Select Committee.
If you have any questions about the matters raised in this article, please get in touch with the contacts listed or your usual Bell Gully advisor.
Disclaimer: This publication is necessarily brief and general in nature. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.
