COMMERCE COMMISSION (INTERNATIONAL COOPERATION AND FEES) BILL BACKGROUND INFORMATION

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Commerce Commission (International Co-operation, and Fees) Bill

Commerce Commission (International Co-operation, and Fees) Bill

Background

Information sharing and the provision of investigative assistance by the Commerce Commission is part of the work programme endorsed by CER Ministers in September 2003. It is also part of the Single Economic Market Outcomes Framework announced by Australian and New Zealand Prime Ministers in August 2009. The objective is to increase co-ordination of competition and consumer policy and law between Australia and New Zealand. In 2007, the Australian Government passed legislation to enable the Australian Competition and Consumer Commission to enhance its ability to provide information to overseas regulators.

The Commerce Commission is currently constrained from giving investigative assistance and compulsorily acquired information it holds to overseas regulators. Its statutory powers of compulsion can be used only in relation to enforcement and adjudication within New Zealand. There are also legal constraints on the provision to overseas regulators of confidential compulsorily information already held by the commission. This in turn limits the willingness of overseas regulators to provide assistance to the commission, as cross-jurisdictional assistance tends to be based on mutual assistance. Most overseas regulators consider the likelihood of reciprocity as a factor in determining whether to provide assistance or information to the commission.

The Government released two discussion papers, in 2004 and 2005, on the appropriate design of a regime to facilitate enhanced co-operation between the Commerce Commission and overseas regulators. Submitters were split in their views about whether further measures were needed to enhance such co-operation. However, given the international nature of business, particularly the increasing internationalisation of hard core cartels, the proposed assistance provisions will increase the efficiency of investigations and the likelihood that illegal conduct will be effectively dealt with. The benefits are most likely to be obtained in relation to Australia and will, therefore, contribute to the objective of a Single Economic Market.

Summary of main features of the Commerce Commission (International Co-operation, and Fees) Bill

The Commerce Commission will be authorised to use its statutory powers under the Commerce Act 1986, Credit Contracts and Consumer Finance Act 2003, and Fair Trading Act 1986 (‘investigative assistance’) and provide ‘compulsorily acquired information’ to assist overseas competition and consumer regulators, subject to certain conditions being met (see below).

Governmental co-operation arrangements

A governmental co-operation arrangement must be in place before the Commerce Commission can provide investigative assistance and compulsorily acquired information to an overseas regulator.

The Minister will need to consider specific matters before entering into a co-operation arrangement such as:

Consistency with New Zealand’s international obligations.

The legal framework in the overseas jurisdiction relating to the use of information compulsorily acquired.

The potential consequences to New Zealand businesses and consumers of the arrangement.

The Minister will be required to consult with the Privacy Commissioner on any privacy related matters, prior to entering into a co-operation arrangement.

Co-operation arrangements will need to:

Identify the overseas regulator.

Identify the overseas competition or consumer law in connection with which assistance or compulsorily acquired information may be provided.

Set out the use and security of information that will be provided under the co-operation arrangement.

Ensure reciprocity from the overseas jurisdiction.

Be made publicly available and published on the Commerce Commission’s website.

Case-by-case requirements for the Commerce Commission

The Commerce Commission will be required to consider specific matters on a case-by-case basis including:

Ensuring that the provision of compulsorily acquired information and investigative assistance is in accordance with an applicable co-operation arrangement.

Being satisfied that the assistance or information relates to a function of the overseas regulator.

Considering whether complying with a request for assistance or compulsorily acquired information would substantially affect the performance of the commission’s other functions.

Considering whether complying with a request for investigative assistance or compulsorily acquired information would be more appropriately dealt with under the Mutual Assistance in Criminal Matters Act 1992.

Maintenance of privilege

The bill also provides protection for privileged material that the commission may provide to an overseas regulator, and vice versa.

7 TIC ET COMMERCE ÉLECTRONIQUE LABORATOIRES DE LA
AC19 DOC 162 CONVENTION SUR LE COMMERCE INTERNATIONAL DES
AC19 DOC 2 (REV 1) CONVENTION SUR LE COMMERCE

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