The Regulator Report lists recent changes, decisions and developments at the main New Zealand and Australian corporate, commercial and competition regulatory bodies. This edition of the Regulator Report covers the period from 4 June 2009 to 1 July 2009. For further details on any matter in this report just click on the hyperlinks in each item.

The Treasury

Overseas Investment Amendment Regulations 2009
These regulations, which come into force on 9 July 2009, represent a further initiative arising from the government's current review of the overseas investment regime. The regulations amend regulation 33 of the Overseas Investment Regulations 2005, which exempts certain specified transactions from the requirements in the Overseas Investment Act 2005 to obtain consent to a transaction that will result in an overseas investment in sensitive land, significant business assets, or fishing quota. The amendments made by these regulations change one of the existing exemptions in regulation 33 and create three new exemptions.

The exemption in regulation 33(1)(a) has been amended to increase its application. It currently only applies to intra-group transactions where the companies concerned are wholly owned by the overseas person. As a result of the amendment, it will now apply to intra-group transactions where the companies are at least 95% owned by the overseas person. Regulation 33(2) is consequentially revoked.

The three new exemptions are:

• the insertion of a new regulation 33(1)(ja), which permits an overseas person to acquire two or more security arrangements if they are acquired together as a portfolio or bundle and the total value of consideration provided for that portfolio or bundle does not exceed $100 million;
• the addition of a new regulation 33(1)(o), which permits the temporary acquisition of securities for underwriting or subunderwriting purposes; and
• the addition of a new regulation 33(1)(p), which permits an overseas person who has previously been granted consent to acquire securities to acquire more of those securities provided that the subsequent acquisitions increase the overall holding by less than five per cent and occur within five years of the date on which the overseas person was granted consent for the initial acquisition of the securities.

Each of the three new exemptions is subject to specified conditions.

Budget 2009 information release
The Treasury has released documents relating to Budget 2009 in response to and in anticipation of requests for Budget-related information. The documents released are among the most frequently requested under the Official Information Act.
Click here for more

The Reserve Bank

Prudential liquidity policy for banks released
The Reserve Bank released its prudential liquidity policy for banks on 30 June 2009. Acting Governor Grant Spencer said the policy sets various balance sheet requirements and disclosure obligations for banks around their internal liquidity management.
Click here for further details

Statement of Intent for 2009-2011
The Reserve Bank has released its Statement of Intent (SOI) for 2009-2011. The SOI is an annual document outlining the bank's plans for the three years ahead, and its budget for the year ahead. The SOI describes the bank's ongoing work program to develop and implement the new regulatory framework for non-bank deposit takers and insurance companies. Other bank priorities include upgrading statistical data collection systems, and establishing a small Auckland office to provide backup for essential payments and market operations in the event of a physical disaster in Wellington.
Click here for more

Reserve Bank Bulletin released
The June 2009 Reserve Bank of New Zealand Bulletin has been released. The focus of this issue is on forecasting the New Zealand economy, but it also includes an interview with Prasanna Gai, Professor at the Australian National University and consultant to the Bank of England, on the current financial crisis and the challenges it poses for policy makers and academic economists.
Click here for more

Ministry of Economic Development (MED)

Implementation of the Financial Advisers Act and Financial Service Providers Act
The mechanisms to implement the Financial Advisers Act 2008 and the Financial Service Providers (Registration and Dispute Resolution) Act 2008 are currently being developed, with the aim of full implementation of both regimes by December 2010. The implementation process contains numerous components, with several government agencies participating. The MED is leading this process. Although both Acts are scheduled to come into force in December 2010, the government's intention is to have the various components of the regime in place before that date so that industry has sufficient time to adapt and become compliant. The Financial Advisers Act 2008: Disclosure Regulations Discussion Document recently released by the MED is one of the main projects underway. This document seeks feedback on proposals for regulations under the Financial Advisers Act. The regulations will specify the form and content of disclosure requirements for financial advisers. Submissions on this discussion document close on 12 August 2009. The other main projects are:

1. Companies Office – Building the register for financial service providers.
2. Minister of Consumer Affairs - developing the dispute resolution framework. The Ministry of Consumer Affairs is currently seeking feedback on the dispute resolution framework (see the item in this section below).
3. Code Committee - drafting the Code of Professional Conduct for authorised financial advisers. The Committee will be made up of both industry and consumer representatives and will be appointed by the Commissioner for Financial Advisers. The appointment process is currently underway.
4. Securities Commission - preparing the processes for the approval and supervision of financial advisers. Feedback is currently being sought on this area (see the item on the "Staff paper on regulating and supervising financial advisers" in the Securities Commission section below)

Click here for further information

Financial service dispute resolution scheme on its way
The government has released two discussion papers relating to the implementation of the financial service providers dispute resolution framework as required by the Financial Service Providers (Registration and Dispute Resolution) Act 2008. The Financial Service Providers Act requires that financial service providers must be registered and those who provide financial services to the public must be members of either an approved dispute resolution scheme or the reserve (dispute resolution) scheme. The discussion papers seek feedback on:

• the draft guidelines to assist schemes applying to become an approved dispute resolution scheme (click here to access this discussion paper); and
• the proposed operating rules and governance arrangements of the reserve dispute resolution scheme (click here to access this discussion paper).

Submissions on these discussion papers close on 31 July 2009. Minister of Consumer Affairs, Heather Roy, noted in her press release for these papers that "[the] disputes resolution framework is critical to the overall implementation of the new legislation, and will be implemented by May 2010. Financial service providers, including Financial Advisers, will have until December 2010 to register."
Click here for the full press release

Government to reform state sector procurement
On 11 June 2009, Commerce Minister Simon Power announced the government's proposed reform of state sector procurement practice and policies. "A reform of government procurement activity is of high importance to the National Government, especially given the current financial climate," Power said. The focus of the reform agenda is to improve state sector productivity and efficiency, increase the opportunities for New Zealand businesses to participate in government contracts, and to release fiscal savings for use in other priority areas.
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Current franchising regulations adequate
The government has concluded there is no need to introduce specific law for the franchise sector at this time. A review of franchising regulations found the mix of general business law and self-regulation by the industry was appropriate, says Commerce Minister Simon Power.

Following reports of alleged fraud involving franchises, a review of franchising regulation was initiated by the previous Minister of Commerce last year. MED received 33 submissions on its discussion document which sought information on whether there are any unique characteristics about franchising, or widespread issues in the franchise sector that would require franchise specific regulation. The submissions were split roughly evenly in their support for and against regulation.
Click here for the press release
Click here to read the Cabinet Paper outlining the main themes arising out of the review and the Minister's recommendations.

New Zealand joins Australian regulatory reform group
Commerce Minister Simon Power has announced that New Zealand has taken up the invitation of the Australian Government to join the Business Regulation and Competition Working Group. The group was established by the Council of Australian Governments (COAG) in December 2007. Its primary task is to oversee and accelerate COAG's regulatory reform agenda which is aimed at reducing the regulatory burden on business.
Click here to read the media release

Climate Change Response (Emissions Trading Forestry Sector) Amendment Act 2009
The government introduced a bill on 18 June 2009 to amend the Climate Change Response Act 2002 in order to delay a number of the pre-1990 foresters' obligations requirements under that Act, including reporting requirements for foresters, allowing applications for exemptions for certain land holdings, and the publication by the government of an allocation plan for pre-1990 forest owners. The bill was amended at the select committee stage to specify 1 July 2010 as the final possible date that may be set as a deadline for applications to be made for exemptions for land holdings with less than 50 hectares of pre-1990 forest land. The bill passed through all other stages without further amendment on 30 June 2009. The Act came into force on 1 July 2009.
Click here for Bell Gully commentary on the bill
Click here to access a copy of the Emissions Trading Scheme Review Committee report on the bill
To access a copy of the Act click here

Settlement Systems, Futures, and Emissions Units Bill
The Commerce Select Committee has examined the Settlement Systems, Futures, and Emissions Units Bill and recommends that it be passed with amendments. The bill is designed to align New Zealand's clearing and settlement system with international best practice, and to facilitate trading in futures and emissions units. The committee's proposed amendments include:

• replacing the insolvency definition;
• introducing several amendments to avoid potential problems in the event that a participant in a settlement transaction became subject to an insolvency event while the settlement was only partly completed;
• clarifying how the new sections introduced by this bill would interact with existing provisions in the Companies Act 1993, the Insolvency Act 2006, and the Insolvency (Cross-border) Act 2006;
• expressly including the adequacy of a settlement system's financial resources among the factors that may be considered by the regulators in deciding whether to grant, vary, or revoke a designation;
• shortening the period within which the joint regulators could disallow a proposed amendment to the rules of a designated settlement system from 40 working days to 20; and
• decreasing the maximum fine for a body corporate from $1 million to $750,000 to bring it into line with other jurisdictions.

Click here to read the committee's full report

Anti-Money Laundering and Countering Financing of Terrorism Bill
A bill to enhance measures to counter money laundering and the financing of terrorism has been introduced to Parliament. The bill sets out regulatory changes to enable New Zealand to comply with the Financial Action Task Force – an inter-governmental body that sets international standards for combating money laundering and terrorist financing. Justice Minister Simon Power said the Anti-Money Laundering and Countering Financing of Terrorism Bill will also help New Zealand tackle financial and drug-related crime by detecting, tracing, and seizing profits of domestic organised crime groups.

The bill uses the word 'reporting entity' to refer to those businesses that must comply with the new regime. Reporting entities include all businesses in the financial sector and casinos, for example:

• banks;
• finance companies and credit unions;
• currency dealers or exchanges;
• issuers, sellers, and redeemers of travellers checks, money orders, or stored value products;
• money transmitters and remitters;
• life insurers; and
• stockbrokers.

The bill has had its first reading and has now been referred to the Foreign Affairs, Defence and Trade Committee for report by 15 September 2009. The government proposes to enact the bill by October 2009. Following enactment, the intent is that reporting entities will have two years to put in place systems and procedures to comply with the new regime, although further discussions with industry are required to ensure the feasibility of implementation timeframes.
Click here to read the full press release
Click here for a copy of the bill

Ministry for the Environment

Draft regulations for the stationary energy and industrial processes sectors
The Emissions Trading Group is developing regulations for the implementation of the New Zealand Emissions Trading Scheme (NZ ETS). Updated draft regulations for the stationary energy and industrial processes sectors involvement in the NZ ETS have been released for consultation alongside draft regulations on unique emissions factors and other removal activities. These draft regulations were released to provide stationary energy and industrial processes participants with notice of the content of their proposed obligations under the scheme as provided for in the Climate Change Response Act 2002. Submissions on this package of draft regulations close on 13 July 2009.
Click here for copies of the draft regulations and further details

Securities Commission

Commission alerts issuers to reporting inadequacies
The Securities Commission recently reviewed financial statements of 24 issuers with balance dates between March and December 2008 in Cycle 9 of its ongoing financial reporting surveillance programme. The commission is still discussing its findings with issuers and has yet to publish its conclusions of its Cycle 9 report but has issued a press release noting that it is continuing to find inadequacies in matters that were previously alerted to issuers. These matters include:

• impairment of assets and the associated disclosures;
• disclosure of significant assumptions relating to valuation of investment properties;
• disclosures relating to financial instruments;
• disclosure of significant judgments, key assumptions and major sources of estimation uncertainty.

Other significant matters that require attention are:

• any change in or review of funding arrangements and the impact on classification of debt and the going concern assumption;
• related party information, in particular, key management personnel compensation (including directors).

The commission urges issuers to pay particular attention to these matters when preparing their upcoming interim and full-year financial statements.
Click here for more details

The financial crisis and corporate governance
Jane Diplock, Chair of the New Zealand Securities Commission, and the Executive Committee of International Organisations of Securities Commissions gave a presentation to the Auckland Rotary on 22 June 2009. The speech addresses how the emphasis on ethics and corporate governance in business has changed for good in the wake of the latest global financial crisis. It is no longer seen as "an optional add-on", but rather as "an essential operating principle". Diplock notes that work carried out at the commission has provided plenty of evidence to support international research which shows that fundamental aspects of corporate governance can play a key role in corporate performance. At a practical level, Diplock notes that good governance embodies the following principles:

• fostering and adhering to high ethical standards in every decision made and every initiative instituted;
• ensuring boards are comprised of appropriately experienced, independent, skilled, knowledgeable directors;
• ensuring remuneration policies are transparent, reasonable and fair;
• ensuring risks are clearly identified and properly managed; and
• ensuring directors are confident of the quality and independence of auditing processes.

The speech also discusses the commission's role and its current priorities in the aftermath of finance company collapses and in relation to the current difficulties in raising and rolling over funds for many New Zealand firms. This includes discussion on the commission's enforcement work, which Diplock notes will focus on requirements for continuous disclosure and on the design of new, simplified prospectus requirements.
To read a full transcript of the speech click here

Securities Commission encourages ING investors to carefully consider purchase offer
The commission has issued a press release to investors in the ING Diversified Yield Fund and the ING Regular Income Fund encouraging them to carefully consider the information provided with the recent offer they received from ING. The commission received a large number of complaints from investors and has reviewed the proposal documents sent out by ING on the ING Diversified Yield Fund and the ING Regular Income Fund. The commission notes that based on the available information, it does not consider that the offer is misleading or deceptive and therefore has no grounds upon which to take any action in respect of the proposal. It is not within the commission's authority to review the merits or fairness of any offer.
Click here to read the full press release

Staff paper on regulating and supervising financial advisers
The Securities Commission has released a staff paper for consultation on the preliminary thinking of commission staff on how the commission might regulate and supervise financial advisers under the Financial Advisers Act 2008. The commission is seeking comments from financial advisers and their employers, consumers, and other interested parties before finalising its recommendations to members of the commission. Submissions close on 30 July 2009. The commission anticipates being in a position to consider applications for QFE status by the last quarter of 2009, and from potential Authorised Financial Advisers by mid 2010.
Click here to access the staff paper

SECURITIES ACT EXEMPTION NOTICES

The following Securities Act Exemption Notice has been published for this period:

Securities Act (Charitable and Religious Purposes) Exemption Amendment Notice 2009
This notice, which came into force on 19 June 2009, amends the Securities Act (Charitable and Religious Purposes) Exemption Notice 2003 (the principal notice) by including Manawatu Golf Club Incorporated in the schedule of the principal notice.

Takeovers Panel

Bell Gully responds to Takeovers Panel on upstream takeovers
Bell Gully has responded to the Takeovers Panel's consultation paper titled 'Upstream Takeovers' released by the Takeovers Panel in April 2009.

Bell Gully supports the Panel's proposal to achieve certainty in relation to upstream takeovers that result in changes in control of downstream Code companies. The status quo leaves the panel to consider exemptions on a case by case basis, as was done in respect of BG Group / Origin / Contact Energy.

Bell Gully supports options for reform that create a certain set of rules (complemented in appropriate circumstances by the panel's general power to grant exemptions) which are sufficiently transparent for potential acquirers and their advisers to predict its application to a proposed upstream acquisition, including, if applicable, the method of valuation of any follow on offer.

The Australian approach, which provides the Australian Panel with the power to declare "unacceptable circumstances" is, in our view, not consistent with the general scheme of the Code which sets out detailed (and certain) rules rather than giving the panel broad discretionary powers (other than to grant exemptions), and may not create certainty in this area.

In our view, the United Kingdom approach would be suitable for adoption in New Zealand as it provides a class exemption from the Code for an upstream acquisition unless either:

• control of the downstream Code company is a main purpose of the upstream acquisition; or
• the shareholding in the downstream company is significant in relation to the upstream company.

To read Bell Gully's full submission on the Panel's consultation paper, Upstream Takeovers, click here.

Takeovers Panel to meet on Knott vote for Rubicon Takeover
The Takeovers Panel convened a meeting for 10 June 2009 under section 32 of the Takeovers Act to consider certain voting issues arising from the recent partial takeover made by a group of investment funds controlled by David M Knott for 10.83% of the voting rights it did not hold in Rubicon Limited.
Click here for further details

TAKEOVERS CODE EXEMPTION NOTICES

The following Takeovers Code Exemption Notice has been published for this period:

Takeovers Code (Metlifecare Limited) Exemption Notice 2009
The Takeovers Panel has granted an exemption to Macquarie Financial Holdings Limited, Macquarie Capital Group Limited, and Macquarie Capital International Holdings Pty Limited in respect of any increase in the percentage of voting rights in Metlifecare Limited (Metlifecare) held or controlled by each of them as a result of the termination of a bare trust and the transfer of the legal interest in certain special shares to the beneficiary. The transfer of the special shares will not result in an effective change of control of Metlifecare. This notice applies to acts or omissions occurring on or after 17 June 2009 and expires on the close of 16 November 2009.

Electricity Commission

Electricity Commission: Review of the first five years
The Auditor-General has published a report on the Electricity Commission's progress in reporting its performance against the Government Policy Statement's objectives, outcomes, and performance standards for Electricity Governance over its first five years. Part 2 of the report describes the situation in the electricity sector before the Electricity Commission was established in 2003. Part 3 describes the commission's objectives and accountabilities. Part 4 discusses monitoring of the commission. Part 5 describes the commission's achievements, and Part 6 discusses the commission's new planning and reporting framework. The Appendix to the report provides an overview of the electricity sector, describing the physical system and the various markets.

The Auditor-General notes that he is not able to comment on whether the work that the commission has completed during its first five years is enough, or on the effect that its work has had on the electricity market, because of the difficulty the commission has had measuring its achievements against its identified objectives and outcomes. However in the last three years, the commission has prepared and put in place a planning and reporting framework which the Auditor-General considers provides a sound basis to begin to measure the commission's effectiveness.
Click here to read the full report

Model approach to distribution pricing
The Electricity Commission has released a consultation paper on a draft proposed model approach to distribution pricing for New Zealand's 29 distributors. The purpose of this paper is to outline the Electricity Commission's proposed guiding principles to a proposed model approach to a distribution pricing methodology, set out the proposed model approach itself, and seek submissions on both of them. The commission considers that a single approach for distribution pricing, with flexibility in its implementation, is the most efficient way to:

• encourage the efficient use of electricity by end users;
• encourage efficient investment in distribution, transmission, distributed generation (including renewable generation), and technology innovation;
• maintain or enhance investment in energy efficiency and demand-side management;
• signal the full costs of transporting each additional unit of electricity to users; and
• facilitate competition in the retail electricity market.

Submissions close on 10 July 2009.
Click here for further details

Electricity advisory groups
The Electricity Commission has recently carried out a general review of its advisory groups. The review has now been completed, and the commission has decided to disestablish the existing advisory groups and replace them with four new advisory groups:

• the Wholesale Market Advisory Group;
• Retail and Consumer Advisory Group;
• Security Advisory Group; and
• Investment Advisory Group.

The groups which have been disbanded are the Hedge Market Development Steering Group; Retail Market; Security; Transmission; Transmission Pricing: and Wholesale. Nominations for the new advisory groups closed on 26 June 2009.
Click here for further details

Australian Government

Creeping acquisitions
The Assistant Treasurer and Minister for Competition Policy and Consumer Affairs, Chris Bowen, released a discussion paper on creeping acquisitions on 11 June 2009. The term creeping acquisitions refers to the acquisition of a number of individual assets or businesses over time that may collectively raise competition concerns, but which individually are unlikely to contravene section 50 of the Trade Practices Act 1974.
Click here for further details

AICD and AUASB release publication to assist company directors
Australian Accounting Standards require directors to consider whether there are material uncertainties that would lead to significant doubt about a company's ability to continue to pay its debts over at least the next 12 months and to make adequate disclosures in the financial report if such uncertainties are identified. The Australian Institute of Company Directors (AICD) and the Auditing and Assurance Standards Board (AUASB) have issued the publication, Going Concern issues in financial reporting: a guide for companies and directors, to assist company directors in performing, and reporting on, their going concern assessment. This publication includes a discussion of:

• The going concern assumption – what it means and its context in difficult or uncertain economic conditions;
• Going concern and liquidity risk – in particular, disclosure requirements;
• The company's interaction with the auditor – the directors' role in planning for the audit and the types of audit opinions that may result from uncertainties about the going concern assumption for a company; and
• Communications issues – including continuous disclosure obligations of listed companies.

Click here for further details

Australian Securities and Investment Commission (ASIC)

New market disclosure measures to enhance capital raising and continuous disclosure by unlisted entities
ASIC has released new measures to enhance market disclosure and efficiency in capital raisings and unlisted disclosing entities. The new equity raising policies seek to streamline the fundraising process by faster and more effective disclosure. The measures also aim to make it easier to include retail investor participation in fundraisings by expanding situations where a full prospectus or product disclosure statement (PDS) is not required. The new unlisted disclosing measures seek to clarify how unlisted entities should provide continuous disclosure to investors.
Click here for further details

New Zealand Commerce Commission (NZCC)

Speeches

Commerce Commission address at 10th Annual Telecommunications and ICT Summit
On 23 June, Anita Mazzoleni, Commissioner, gave a speech on behalf of the Commerce Commission at the 10th annual Telecommunications and ICT Summit. In her speech, Mazzoleni discussed:

• New Zealand's regulatory framework;
• recent changes in the telecommunications sector, particularly in investment and broadband; and
• the NZCC's key focus over the year being mobile services.

Click here for more

Media releases

The NZCC has issued the following media releases:

Industry regulation and regulatory control

• Commerce Commission determines that Kaimai and Grate Kiwi are independent processors
  The NZCC has released its final determination regarding disputes between Fonterra Co-operative Group Limited and both Kaimai Cheese Company Limited and The Grate Kiwi Cheese Company Limited. The NZCC's view is that Kaimai and Grate Kiwi are 'independent processors' under the Dairy Industry Restructuring (Raw Milk) Regulations 2001 and are entitled to be supplied with milk by Fonterra under the regulations.
  Click here for more

• Commerce Commission releases discussion documents on Part 4 of the Commerce Act
  The NZCC has released three key discussion documents relating to regulation under Part 4 of the Commerce Act. These are:
• The input methodologies discussion paper which is the first significant consultation paper released by the NZCC as part of the process to determine input methodologies by 30 June 2010. It sets out the NZCC's preliminary views in relation to matters to be determined under Part 4 for regulated electricity lines, gas pipelines and specified airport services. Submissions close on 31 July.
• The Transpower process and recommendation discussion paper which outlines the NZCC's preliminary views on the appropriate price-quality regulation of Transpower and the process that the NZCC intends to follow on making its recommendation to the Minister of Commerce. Submissions close on 31 July.
• The reset of default price-quality path for electricity distribution businesses discussion paper which sets out the NZCC's preliminary views on the reset of the initial default price-quality path (DPP) for electricity distribution businesses. The views expressed relate to the nature and form of the reset DPP to apply from 1 April 2010, the potential for and timing of starting price adjustments, the appropriate method for determining the rate of change for the industry, and the method for determining appropriate quality standards. Submissions close on 17 July.

For further details on these discussion documents and for links to the accompanying technical reports and papers click here.
For Bell Gully commentary on these discussion documents click here

• Commerce Commission releases revised draft guidelines on the cost of capital
  The NZCC has released its revised draft guidelines on its approach to estimating the cost of capital. Estimating the cost of capital is an important part of the NZCC's work under Part 4 of the Commerce Act 1986, the Dairy Industry Restructuring Act 2001 and the Telecommunications Act 2001. Submissions close on 31 July.
  Click here for more

• Commerce Commission declines Transpower request to amend settlement
  The NZCC has declined a request from Transpower that the NZCC amend the administrative settlement it reached with Transpower last year. Transpower sought an amendment to the settlement in order to remove its exposure to instantaneous reserve fees by allowing Transpower to pass through these costs to South Island generators, rather than being absorbed into Transpower's own operating costs.
  Click here for more

• Commerce Commission receives application for EIR Act exemption from Joan Withers
  The NZCC has received an application from Joan Withers seeking exemption from section 17 of the Electricity Industry Reform Act 1998 in relation to Mighty River Power Limited's proposal to appoint Joan Withers to its Board of Directors. Currently she is a director of Auckland International Airport Limited which owns the electricity distribution network at Auckland Airport.
  Click here for more

• Commerce Commission receives application for EIR Act exemption from Mark Tume
  The NZCC has received an application from Mark Tume seeking exemption from sections 17 and 17A of the Electricity Industry Reform Act 1998 in relation to PowerCo Limited's proposal to appoint Mark Tume to its Board of Directors. Currently he is a director of Infratil Limited, which owns a 50.5 per cent shareholding in TrustPower Limited.
  Click here for more

Mergers and acquisitions

• Fullers Group cleared to acquire 360 Discovery
  The Commerce Commission has granted clearance for Fullers Group Limited to acquire most of the assets of the business called 360 Discovery operated by Kiwi Kat Limited.
  Click here for more

• Fullers Group applies for clearance to acquire assets of Kiwi Kat
  The NZCC has received an application from Fullers Group Limited seeking clearance in relation to the proposed acquisition of most of the assets of 360 Discovery, operated by Kiwi Kat Limited.
  Click here for more

• Pfizer applies for clearance to acquire Wyeth
  The NZCC has received an application from Pfizer Inc. seeking clearance to acquire Wyeth Corp.
  Click here for more

Market behaviour

• Commerce Commission enables streamlined authorisations
  Following public consultation, the NZCC has developed a new streamlined authorisation process. This process has been designed to enable faster decisions for straightforward authorisation applications that have clear public benefits and a relatively limited impact on competition.
  Click here for more

• Commerce Commission welcomes appointment of new commissioners
  The Chair of the NZCC Dr Mark Berry said he welcomes the appointment of two new commissioners to assist with the competition agency's high workload. Susan Begg has been appointed a full commissioner, and Patrick Duignan has been appointed an associate commissioner.
  Click here for more

• Update on Commerce Commission investigation into ING
  The NZCC's investigation under the Fair Trading Act into ING (NZ) Limited's Diversified Yield and Regular Income Funds is not expected to be completed for at least six months. This means that the investigation will not be concluded prior to the end date given by ING for acceptance of the settlement offer made to investors.
  Click here for more

Telecommunications

• Commerce Commission releases draft recommendation to regulate mobile termination prices
  The NZCC has released its draft report recommending that the mobile termination prices should be regulated. The NZCC also recommended that the undertakings submitted in lieu of regulation by Vodafone, Telecom and 2degrees should be rejected.
  Click here for more

• Commerce Commission to commence mobile roaming investigation
  The NZCC announced on 30 June 2009 that it intends to commence a Schedule 3 investigation into whether regulation of the national mobile roaming service should be extended to include price. The NZCC expects to release a draft report in mid October and complete the investigation by the end of February 2010.
  Click here for more

• Commerce Commission issues sub-loop decision
  The NZCC has released its decision on the price and non-price terms on which Telecom must make the unbundled sub-loop services available to other telecommunications providers.
  Click here for more

Consumer issues

• Commerce Commission will not appeal Avanti Finance decision
  The NZCC has decided that it will not appeal against the recent decision of the High Court in Commerce Commission v Avanti Finance Limited. The case related to the fee on full prepayment (or break fee) that Avanti charged to debtors who repaid their loans early.
  Click here for more
  For Bell Gully commentary on the High Court's decision click here

• Assembled in New Zealand not enough to claim 'New Zealand made'
  Another New Zealand office furniture company has been fined for breaching the Fair Trading Act for claiming in advertising brochures that two models of office chairs were made in New Zealand. Auckland based Eden Office Seating pleaded guilty to three charges and was fined $5,000 and $2,500 in court costs in the Auckland District Court.
  Click here for more

• Voluntary recall of Mary Lou wooden toy
  A distributor of the Mary Lou doll, an iconic New Zealand wooden toy, is undertaking a voluntary recall of all Mary Lou dolls sold in New Zealand since 1 June 2008. The NZCC began an investigation after receiving a complaint that in one incident the small beads of the arm of a Mary Lou doll had become detached from the doll's body.
  Click here for more

• Furniture store fined for Fair Trading Act breaches
  A furniture store has pleaded guilty to 28 charges of breaching the Fair Trading Act by providing misleading information about the savings that consumers would make by buying goods on sale. The company has been fined $28,000 plus court costs of $3,640 in the Manukau District Court.
  Click here for more

• Farmers fined for Fair Trading breach
  A New Zealand department store chain has been found guilty of breaching the Fair Trading Act and was fined $10,000 in the Christchurch District Court. Farmers Trading Company Limited was fined for displaying a television at its Eastgate store in Christchurch as new a year after the television had been returned by a previous customer to its Rangiora store because it had stopped working.
  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 not to oppose Woolworths' proposed acquisition of Macro Wholefoods
  The ACCC will not oppose Woolworths Limited's proposed acquisition of organic supermarket operator Macro Life Pty Ltd (trading as Macro Wholefoods Market). The ACCC concluded the acquisition is unlikely to substantially lessen competition in the relevant organic food and grocery markets.
  Click here for more

• ACCC not to oppose the proposed acquisition of Aqua-Max by Rheem Australia
  The ACCC will not oppose the proposed acquisition of the Aqua-Max water heater business from Sietel Ltd by Rheem Australia Pty Ltd. The ACCC has concluded that the proposed acquisition would be unlikely to substantially lessen competition in the relevant market for water heaters.
  Click here for more

Market behaviour

• ACCC authorises collective bargaining by Victorian lottery agents
  The ACCC has granted an authorisation allowing Victorian lottery agents to collectively negotiate the terms and conditions of their contracts with the two companies licensed to operate lotteries in Victoria, Tattersall's and Intralot.
  Click here for more

• ACCC sees benefit in ATM sub-network fee free agreement
  The ACCC has authorised an agreement between members of an automatic teller machine sub-network not to charge each others cardholders a fee for transactions at ATMs owned by members.
  Click here for more

• ACCC institutes legal action against Australian Karting Association (NSW) over alleged price fixing agreement
  The ACCC has instituted legal proceedings in the Federal Court, Sydney, against the Australian Karting Association (NSW) Inc (AKA) various AKA clubs and officers for alleged contraventions of the Competition Code of New South Wales.
  Click here for more

• ACCC proposes to allow Tasmanian softwood sawlog joint venture arrangements
  The ACCC has accepted that the Softwood Tasmania joint venture arrangements provide greater access to capital resulting in the further development of Tasmanian forestry assets, and proposes granting authorisation to the arrangements for 10 years.
  Click here for more

• Janome stitches itself up
  Janome Australia Pty Ltd, which wholesales Janome sewing and quilting machines, overlockers and associated products in Australia, and its managing director, Mr Toshiya Takayasu, have admitted engaging in resale price maintenance. Between February and April 2008 Janome sought to impose a Minimum Advertised Price Policy on its retailers.
  Click here for more

• ACCC institutes proceedings against DRS C3 Systems
  The ACCC has instituted proceedings against American-based company DRS C3 Systems for alleged cartel behaviour in the international military defence training systems industry.
  Click here for more

• ACCC grants interim authorisation to the Gorgon Gas Project joint venture
  The ACCC has decided to grant conditional interim authorisation to the Gorgon Gas Project joint venture to engage in joint marketing of natural gas to customers in Western Australia.
  Click here for more

• ACCC proposes to approve fixed odds wagering joint venture
  A joint betting venture between TOTE Tasmania Pty Ltd, ACTTAB Limited and Racing and Wagering Western Australia is likely to be authorised by the ACCC Commission. The proposal before the ACCC is to grant authorisation to let the agencies jointly supply fixed odds betting services and to appoint Centrebet Pty Ltd to manage these services.
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• ACCC institutes action against taxi industry giant Cabcharge
  The ACCC has instituted legal proceedings in the Federal Court, Melbourne against Cabcharge Australia Limited for alleged breaches of the Trade Practices Act 1974 in relation to its conduct in the Australian taxi industry.
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• ACCC allows chicken processing merger after sale of Victorian assets
  The ACCC will not oppose the proposed acquisition of Bartter by Baiada Poultry after competition concerns were resolved by Baiada's undertaking to sell certain Victorian assets to competitor La Ionica Poultry.
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Telecommunications

• ACCC not to oppose proposed merger of Vodafone and Hutchison
  The ACCC will not oppose the proposed merger of Vodafone and Hutchison's Australian mobile operations, after concluding that it is unlikely to substantially lessen competition in the relevant markets.
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• ACCC issues MTAS declaration final report
  The ACCC has released the final report on its public inquiry into the declaration of the domestic mobile terminating access service (MTAS). In its final report, the ACCC has decided to extend the existing MTAS declaration for a period of five years to 30 June 2014.
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• ACCC proposes a five year extension for key telecommunications declarations
  The ACCC announced it intends to extend the declarations that enable Telstra's competitors to provide fixed voice and broadband services over Telstra's copper network for a further five years. The ACCC's draft decision forms part of its ongoing review of the declarations of the six fixed-line services, and interested parties are invited to submit responses to the draft.
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• Telco competition: Signs of life but yet to thrive
  While consumers have been rewarded with greater competition and investment in telecommunications, the current structure of the industry is likely to limit future pay-offs, the ACCC has concluded in its annual reports on competition and pricing in the industry.
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• ACCC rationalises telecommunications regulation
  The ACCC has decided to cease regulation of the digital data access service (DDAS) and integrated services digital network (ISDN) after 30 June 2009. Acting Chairman Peter Kell said that in balancing the objectives of regulation, the ACCC was not satisfied that continued declaration of these services would be in the long-term interests of end users.
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Access

• ACCC invites comment on Australian Rail Track Corporation Hunter Valley rail network access undertaking
  The ACCC invites submissions on the Australian Rail Track Corporation's voluntary access undertaking for the Hunter Valley rail network. The main purpose of the network is to provide rail infrastructure to transport coal from mines to port terminals at the Port of Newcastle.
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• Water Market Rules and Water Charge (Termination Fees) Rules commence – ACCC issues guides
  The Water Market Rules 2009 and Water Charge (Termination Fees) Rules 2009 have come into effect after being registered by the Minister for Climate Change and Water in accordance with the Water Act 2007.
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Consumer issues

• ACCC issues guides on unit pricing for grocery retailers
  The ACCC has issued guidance for grocery retailers about their obligations under the new Unit Pricing Code. The code comes into effect on July 1 and requires larger supermarkets and online retailers to comply by December 1 2009.
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• ACCC identifies false 'Product of Australia' claims by Waverley Woollen Mills for its 'Work Wear' jumpers
  Waverley Woollen Mills Pty Ltd has admitted making false 'Product of Australia' claims for its Waverley Work Wear jumpers following an ACCC investigation. Fibre for the jumpers was spun in Australia, but the jumpers were woven in Vietnam and imported into Australia.
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• ACCC takes action to stop misleading SMS advertisements
  "The ACCC and Australian consumers have had enough of advertisements for premium mobile services that are, in the ACCC's view, misleading," Acting ACCC Chairman, Peter Kell, has said. The Federal Court has found that advertisements by AMV Holdings Limited, a company based in the United Kingdom, published in Dolly, Girlfriend and TV Hits magazines, were misleading.
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• ACCC institutes proceedings against seller of Aboriginal art for misleading representations
  The ACCC has instituted proceedings in the Federal Court in Adelaide against a wholesaler and retailer of Aboriginal art and the company's director. The ACCC alleges that Australian Dreamtime Creations Pty Ltd sold to retail outlets in various states and from its website certain artworks that it falsely claimed were painted by a person of Aboriginal descent and by an artist named 'Ubanoo Brown'.
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• Sleep City and Everyday Living customers offered redress following ACCC action
  A $100 gift voucher will be available to a number of customers of a national bedding and furniture retailer after ACCC intervention. Furniture and Bedding Concepts Ltd, which owns and operates 107 retail stores under the Sleep City and Everyday Living brands, has offered the voucher to those customers who were likely to have been misled by comparison pricing claims that appeared in its Spring '08 catalogue.
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• ACCC imposes strict conditions on revised Cosmetic Surgery Code of Practice
  The ACCC has imposed strict conditions on the Australasian College of Cosmetic Surgery's Code of Practice to ensure that it operates effectively. In February the ACCC issued a draft determination proposing to deny authorisation for the code. In response the college has substantially revised the code.
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• Door to door sellers must clean up act after ACCC action against Craftmatic
  Companies selling products door-to-door have been warned to deal fairly with their customers following legal action today by the ACCC. Craftmatic Australia Pty Ltd today agreed to court declarations and injunctions against it for acting in an unconscionable manner against senior citizens after legal action in the Federal Court, Brisbane by the ACCC.
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• Pamphlet distributor admits misleading delivery claims
  A leading pamphlet distributor, PMP Distribution, has admitted to providing some of its customers with reports that included incorrect pamphlet delivery statistics.
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• Sports 'investment' schemes a fast way to do your bucks
  A quick way to turn a large amount of money into a small one – or none at all – is by playing with sports investments schemes. That's the warning from a multi-agency taskforce that has been cracking down on sports arbitrage and sports investment scams.
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• Federal Court finds retail landlord's conduct unconscionable
  The Federal Court has ordered a Melbourne retail landlord to compensate four tenants after it engaged in unconscionable, misleading and deceptive conduct. In a victory for the small business operators, the court declared Dukemaster Pty Ltd engaged in unconscionable conduct, misleading and deceptive conduct and made false representations.
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